HL Deb 03 April 1946 vol 140 cc545-73

2.38 p.m.

LORD BALFOUR OF INCHRYE had given Notice that he would move to resolve, That, in view of the national man-power shortage and in order to ensure a proper balance between productive and non-productive population, the extension of public ownership and control of industry and expansion of social services needs the greatest economy, consistent with efficiency, in numbers of central and local government staffs. And further, that conditions of service in certain grades of Government service require revision in order to attract the best material available.

The noble Lord said: My Lords, I rise to move the Motion in my name on the Order Paper. Your Lordships will observe that the case which I shall endeavour to make is based primarily upon a national man-power shortage, and indeed this shortage has been admitted by the Prime Minister, speaking in another place, when, on 27th February, Mr. Attlee said: We are faced with a shortage of manpower. We must see to it that it is used to the best advantage, and that means a changed attitude of mind. For years before the war we were accustomed to having surplus labour on the market, to having a large amount of unemployment, and the existence of that surplus labour bred in all classes an attitude of mind which must be changed. If the position of man-power is acute at the moment, I think your lordships will agree that study of the future makes the position look even grimmer. Firstly, there is the population forecast, with which I propose to deal shortly. Secondly, there is the growth of non-productive employment. Thirdly, the population decline is accompanied by a serious disequilibrium of age-groups. Briefly, a larger number of young men must do the exacting manual work to support a growing population of elderly people. I understand the Esquimaux have an effective way of dealing with those who approach the age of 60, but I do not think the rather severe method of the Esquimaux would appeal to this country, and therefore we mast look to other measures,

LORD CALVERLEY

Would the noble Lord amplify his remarks about this method? They may be of public interest.

LORD BALFOUR OF INCHRYE

I would only reply to the noble Lord that if he is approaching or over the age of sixty, I would advise him not to go to Esquimau-land in order to make first hand inquiries. Now, my Lords, I wish to examine the position. I wish to give a few figures, mainly with the aid of this excellent book that His Majesty's Government have produced, the Monthly Digest of Statistics. The total working population of Great Britain is approximately 21,000,000, in round figures. If we take from this 1,100,000 for the Armed Forces of the Crown, which is the target which the Government hope to achieve by the end of 1946; if we take also 700,000, being the approximate strength of the non-industrial Civil Service, and 850,000 employed in local government service, and 300,000—

LORD PAKENHAM

May I have that last figure?

LORD BALFOUR OF INCHRYE

Approximately 850,000 in local government service, and 300,000 unemployed. To that we may add half a million on munitions, which is the forecast of what the Government hope to achieve by the end of 1946. This means that 3,450,000 of the 21,000,000 of our working population are virtually non-producing towards our economic recovery. That means that out of a total working population of 21,000,000 persons the onerous task falls on 17,550,000 of carrying the balance of a population of 43,000,000, including 12,000,000 under 14 or over 65. The problem is even more serious on closer examination, because the shortage of labour is acute in certain vital industries but is tending to recover all too satisfactorily in other less essential industries. In fact an out of phase recovery in our employment position can render the manpower situation even more serious. Furthermore, although 500,000 is the target for munitions by the end of this year there will probably be more than 1,000,000 still making munitions on June 30. Our loss of foreign assets has made us require a 50 per cent, increase in exports if we are to maintain the standard of living, and the Government have told is we must have a 75 per cent, increase in order to progress according to that standard.

It has been calculated that we need 500,000 more men employed on manufacturing goods for export. On the other hand, we know there are shortages in various industries. I will not quote figures for them all. In the textile industry there is a shortage of approximately 350,000. Your Lordships are aware of the big figures so far as the mining industry is concerned. In the agricultural industry there is a shortage. If we draw men to meet these shortages from our home orders our own standards of consumption must suffer. On a short term I believe we could probably take these men from supply department work which is closing down, but there are limits to this, and I submit to your Lordships that it would be undesirable to have too many women in industry, because the vital job of women in peace-time is not to be employed in industry but to look after the home and to rear families to alleviate the falling birth-rate.

Against this background of the present, which I have tried to paint in very general terms and as briefly as possible, because I do not wish to occupy your Lordships' time unduly, we see the growth of bureaucracy. That growth has been steady and constant over the past years. Look at the remarkable growth of the Civil Service. I am taking my figures from the May Committee Report on National Expenditure and from the Statistical Digest. In 1914 the strength of the Civil Service—and all the time I am speaking of the non-industrial Civil Service—was 250,000. In 1923 it had grown to 300,000; in 1930 to 320,000; in 1939 to 400,000; in 1945 to 716,000, and in 1946 it was 691,000. I grant, however, to the noble Lord, Lord Pakenham, who is going to reply, that there has been a reduction over the last three months, according to the White Paper which the Government published, but, nevertheless, although there has been an overall reduction, this reduction in the number of civil servants has been mainly in War Departments closing down, and there is an increase of over 9,000 during the last three months in the strength of the Civil Departments. Inevitably, the legislative programme of the present Government with regard to social service, expansion and nationalization must mean a larger number of civil servants in the future in the Civil Departments.

Let us remember that before 1913 we had thirteen Government Departments. Since 1938 that total has increased to twenty-five Government Departments. Not only has the number of Government Departments increased, but the individual staffs of these Government Departments have gone up very largely. Though the tendency is downward to-day—in fairness I must admit that—it is very unlikely that these Government Departments will ever get anywhere near the 1939 figures. Let me give a few examples. In 1939 the Admiralty employed 9,500. To-day it employs some 48,000. The War Office employed 6,000. To-day it employs something like 58,000. The Ministry of Food employ some 39,000. The Ministry of Supply and Aircraft Production together employ some 59,000. Sir Stafford Cripps has already warned us that there will be a very heavy increase in the strength of the Board of Trade in view of the new duties which that Department has to assume.

LORD PAKENHAM

Has the noble Lord got a quotation?

LORD BALFOUR OF INCHRYE

For that last statement?

LORD PAKENHAM

That a very heavy increase is expected.

LORD BALFOUR OF INCHRYE

I think I can get it. I do not think the noble Lord, Lord Pakenham, will deny that Sir Stafford Cripps has said that there will be an increase. I will check it. "A very heavy increase of staff in certain directions will be necessary in order that the Board of Trade shall carry out its responsibilities." When the programme of nationalization, which this Government has announced as a first step, is completed, we can expect to see—assuming that the iron and steel industry is nationalized; I am including that figure of some 238,000—in Civil Service of all sorts, in local government service, in the nationalized industries, in the Armed Services, in fact in national and State service of some form or other, a total of some 5,180,000, so that about one in four of the employed population of this country will in future depend upon the State in some form or other as the employer.

I turn for a moment to ask: What of the future? I submit that because a country can stand a Civil Service and a local government service of 1,500,000 at the present time, it docs not mean that we can stand it fifteen years hence. In fifteen years time those in the twenty years group will represent some 700,000 less than they do to-day. Many estimates are made about the future of the population but I take as one example the figures given in a book recently published, Children for Britain, which some of your Lordships may have read and which was reviewed in a masterly way by Professor Joad in the Statesman and Nation on March 9. The estimate in the book is based on the assumption that there is no increase in the birth-rate. We see that in 1700, in the days of William III, the population of this country was 5,500,000. In 1800 it rose to 8,500,000. Then came the Industrial Revolution, and we quadrupled the population in a comparatively short time, so that by 1900 we had 32,000,000, and in 1945 42,000,000. This book concludes that our peak will be reached in 1949 with something like 43,000,000. Then we start to drop so that by 2039 we are down to 16,000,000 and by 2139 (which may not interest us personally, but nevertheless is of great interest from the national point of view) we are down to 6,000,000.

It is a gloomy forecast. As noble Lords move know, Dr. Enid Charles, the well-known authority, in 1933 made some calculations and her calculations were that we should be down to 31,452,000 by 1975 and 14,500,000 by 2035, so you will see that the prospect is indeed grave. These startling figures make one wonder when the curve of the prospective growth of the Civil Service, which is about 75 per cent. in six years, would meet the curve of the population decline. If one cared to make a graph of these two figures one would make the interesting but not very convincing discovery that, by the year 2000 every single person in this country would be a civil servant. I do not base my case upon that strange set of statistics but it is clear that the ratio of non-producers to producers is increasing to an alarming degree in this country.

I would like to turn for a moment to what we can do to improve matters and try to guard against the impact of the crisis. Firstly, there is the question in industry of greater production and I submit that we must look to production and not to employment as a criterion of the success of each industry. This means naturally more mechanization and an intensified employment of capital. Secondly, I am sure that we can only succeed in industry if we continue the co-operation between employer and employee which has been developed during the war and which I am glad to say the General Council of the Trades Union Congress asks to be continued in the form of the permanent continuation of Works Councils. I am certain that the time is long past when operatives in industry cannot justifiably claim to have a say in that policy. As regards hours of work I believe that they must vary industry by industry according to the particular technique of the industry, and I am glad to say that the Trades Union General Council has come to the conclusion that the forty-hour week must not be pressed. It must be, I hope it will be, put into the background. It should be judged industry by industry in the sole light of whether production would be expanded by it or not, at any rate while the present recovery task is upon us.

Secondly, the next section with which I would like to deal for the moment to try to guard against the impact of the manpower crisis, is the scientific Civil Service. The Government proposals, published in the White Paper of September, 1945, dealt with the proposed reorganization of this increasingly vital service. I think it is satisfactory that the proposals provide for fairly substantial increases of salary, but I would put to noble Lords that careers in the scientific Civil Service do not compare favourably with careers in industry nor do they compare favourably with the careers on the administrative side of the Civil Service. I have some figures from the Professional Civil Servants' Institute which show that a career in the scientific Civil Service does not equal in salary level or prospects the ordinary administrative Service. And as regards industry I have some comparisons that show that superintendents, assistant superintendents and managers in private industry are drawing very considerably increased emoluments compared with members of the Civil Service. Whatever Government may be in force we have got to depend increasingly upon the development of science in industry to ensure our ability to compete. That is why I press to-day for better conditions and a more certain career in the scientific Civil Service.

Thirdly, I would ask that staffs should be scrutinized. It is a very old cry "Economize in staff." Always the Treasury questions the establishments proposed by the ordinary Departments and always the Departments say that their establishment proposals are too meagre and that they cannot get through the work. We should start the slogan "Is your presence really necessary?" to the large number of civil servants from the top downwards, because unless the necessity for the top is questioned you will find there is always a highly responsible official who will attract to himself junior officers. Not only the junior establishment but the more senior posts should be considered. Fourthly, I would like to see civil servants much more highly paid and business secondments in peacetime as we have had them in war-time.

Fifthly, I would like to ask if there could be some review of the lower grades of civil servants. There have been recently proposals for increasing the pay of typists. We have had the absurd position that the work of highly responsible officials has been held up by the absence of lower-grade typists. The new proposals bring Civil Service typists into line with commercial practice. The Treasury policy on wages is laid down in the Report of the Royal Commission on the Civil Service 1929 –31, Paragraph 308. It says: In effecting such comparisons [that is comparisons between industrial wages and State wages] the State should take a long view. Civil Service remuneration should reflect what may be described as the long-term trend, both in wages levels and in the economic condition of the country. It is all very well, but when the long view means that any review always take; place long after the commercial trend has shown itself, then in lower grades like typists the Government suffers because they have lost the opportunity of getting such good people as existed on the market and who have already been snapped up by industry. I think the interpretation of the Treasury taking the long view of the economic trend should be amended in respect of lower grades and that there should be a bolder outlook which should enable the Civil Service to take advantage of the market while it exists and not to be too late.

Finally, I would ask whether, as soon as the building situation allows, we can have decent offices for all our civil servants, junior and senior. You cannot expect decent work in bad conditions and no business would tolerate what many senior and thousands of junior civil servants have to put up with as regards the actual offices, ventilation, heating, sanitation and recreation. Many of our Government buildings are thoroughly outmoded and would be condemned by any modern business concern.

I have tried in the space of just under thirty minutes to review the present manpower situation and to look at the grim future. I have been so bold as to make one or two proposals for the consideration of His Majesty's Government. I do maintain that a crisis of man-power is on us now. It is growing steadily in gravity, and we cannot afford to neglect any single direction which may help tow-ads the solution of the problem which faces us. I beg to move.

Moved, to resolve, That, in view of the national man-power shortage and in order to ensure a proper balance between productive and non-productive population, the extension of public ownership and control of industry and expansion of social services needs the greatest economy, consistent with efficiency, in numbers of central and local government stalls. And further, that conditions of service in certain grades of Government service require revision in order to attract the best material available.—(Lord Balfour on Inchrye.)

3.2 p.m.

LORD MARLEY

My Lords, I read this Motion with considerable interest, and I must say that the noble Lord has explained very clearly what seemed to me to be rather confused. I am not sure that his idea as regards the Esquimaux would not bring even nearer the time when the population of this country became purely civil servants. But when he stressed the growing average age of our population, he did not say very much about the use of the older people in the production drive which he is supporting. Now it is true that early next month there will be two debates in your Lordships' House which will deal to some extent with that factor, but in view of the fact that the noble Lord touched upon the increase of production, it was a pity that he did not perhaps say a word about increased production efficiency.

Now this has been stressed, as he rightly pointed out, by the manifesto of the Trades Union Congress issued a couple of Gays ago, and there is no doubt that the need both for the home market and for our exports stands out as a vital factor in the standard of living of this country. Here I want to suggest that the greatest contribution to production efficiency must be made by management. It is idle to demand harder work from workers when they see a great deal of their energy and time wasted in unnecessary transport, in bad organization, in incompetent production control, in lifting unnecessary weights, and in making unnecessary movements. Management must supply the means to secure the maximum possible production from the applied energy of the worker. Management must be ready to study new methods.

In this connexion, it is a matter of profound regret that there are no simple means of comparing productive and nonproductive elements in our industrial setup. We have no common standards between industry and industry, between factory and factor, for comparing industrial productive and industrial nonproductive elements. That is why very many managements of industry do not realize that they could, in fact, make a very much greater contribution to production if only they knew what was being done in other factories in their own industry, both in this country and in other countries. There is room for a much greater exchange of information.

When we compare production in this country with that in the United States, I would draw attention in passing to the Report of the Platt Commission, which showed that the British worker in the textile industry produces forty per cent, of what the American worker produces. Yet the British worker is a better craftsman than the American, and if only his energy and work were organized by the management in the best direction, there is no doubt he could produce at least as much as, and probably even more than, the average worker in the United States. The same remarks apply to coal. In the coal industry in America, wages are double those in this country, yet the cost of production is only one-half of what it is here. There are, of course, difficulties in the coal-mining industry into which I do not want to go, but the matter is worth studying in connexion with the manpower problem to which reference has been made.

There is one other point I may deal with before leaving this matter, and that is the production of motor-cars. Here, again, wages in the United States in the motor-car industry are double those in this country. Overheads are greater in Britain, the actual ratio of personnel in that industry being in the United States one hundred productive to twenty-five non-productive; in Great Britain one hundred productive to seventy-five nonproductive. Those figures have a bearing on the fact that the prices for cars in America are, car for car, one quarter of what they are in this country, and the production per man-hour in the car industry there is double what it is in Great Britain. I would suggest in this connexion that management must be ready to study new methods and to make a contribution to dealing with the manpower problem by a readiness, an openmindedness, a willingness to admit that we are not perfect and that we have something to learn. That lesson would be definitely in the interests of solving the problem the noble Lord has put before the House. The Government, of course, are aware of this, and we have training schemes for management, the business training schemes of the Government and the new British Institute of Management, to which the Exchequer is making a contribution of£150,000 over a number of years, which may help in this direction.

There is one other point before I leave this aspect, and it was referred to by the noble Lord. It is the need for better conditions in industry. The noble Lord quoted the Prime Minister on this matter. Let me continue his quotation. The Prime Minister said: In an era of full employment, employers will have to realize that there are not a lot of people waiting for jobs, and those who do not offer a proper standard of wages and conditions will go short of labour. That, of course, is one of the problems facing the textile industry—that conditions in the past have been bad, and consequently labour is not willing to go into an industry where conditions are not on the same high level as in many of the more modern industries in this country. Here again managements will have to realize that shorter hours need not mean a diminution in aggregate production; it is a matter of internal organization in factories. It is now considered probable that in most industries there could be an even higher aggregate production with a shorter working week. In particular, the five-day week is worthy of the most careful study with a view to giving that forty-eight hours of rest during the seven days which results in such an immense addition to the working capacity of the worker when he or she comes back on the Monday. These are contributions to the man-power problem—a shorter working week, increased leisure as an incentive, and less fatigue.

Here we come to the desperate importance of human relationships. Sir Samuel Courtauld, speaking on this some time ago, used these words: The worker is the most costly, the most delicate, the most various and variable machine which industry has to employ, and he is infinitely more complex and less uniform than any raw material or any intricate chemical compound. With reference to another point which was made, it is interesting that this fact has been stressed by one of the great industrial leaders who was taken into the Civil Service, the Ministry of Supply, during the war—namely, Sir Graham Cunningham. He said that he believed enlightened leaders of industry have learnt of the great advantage to be obtained from keeping all employees well informed of changes and developments in industry and he recommended a public information service in' every factory so that workers could know what was going on and could move in the direction of industrial democracy in which they would share to the full in every aspect of management. The T.U.C. is in favour of this, and we want industry generally to support this development.

Can the Civil Service make a contribution to the solution of the problem before the House? Here I must say that I thought the figures given were somewhat misleading. The suggestion is that every member of the Civil Service is nonproductive, but nothing could be further from the facts. In the first place, if we analyze the total force of nearly 700,000 to which reference was made, it is only 3½per cent, of the working population, but from that we must surely take away the Post Office, which is producing—I can say this while my noble friend the Postmaster-General is not here—many millions of pounds in relief of taxation every year; much more, in my opinion, than it ought to be producing. The Post Office is surely a productive Department. The Service Departments cannot be considered unproductive, because, after all, they have just enabled us to win a war. This leaves only 200,000, which is just about I percent, of the working population.

LORD BALFOUR OF INCHRYE

May I interrupt the noble Lord to say that the 700,000 has nothing to do with the 1,000,000 which is the target for the Armed Forces? I think he will find that the Post Office employees come under the industrial Civil Service.

LORD MARLEY

If the noble Lord will refer to Command Paper 6763, "Staffs Employed in Government Departments "issued in March, 1946, he will see that my figures are approximately correct, although not to the nearest one or two. The 200,000 which is left includes those employed in Departments such as food and rationing, fuel, transport, labour, works, pensions, assistance boards, etc. I am quite certain that the noble Lord will be the last to want any reduction in those Departments. So we come down to the question that he poses of a balance between productive and non-productive population. He did not, I think, deal with the costs of distribution, but in that connexion there is, I think, a good deal which might be done. In shops, in transport, and in other directions it is possible that we have too many employed in distribution services. We have, however, no figures and it will not be until after the census of production which is planned for 1948 that we shall have complete figures to deal with that difficulty. However, the President of the Board of Trade has already adumbrated something in that direction, because I see that in a message to the Multiple Shops Federation last week he said there was a need to economize in man-power in distribution so as to give more labour for production. He suggested that many millions of man-hours a year now wasted could be saved by co-ordination.

The implication of the Motion, as I have said, is that the Civil Service is non-productive, but when one considers how much of the work it is doing is vitally important I do not think we can say that it is. As to one of the new Departments to which reference was made, the Ministry of National Insurance, I notice that the Leader of the Party to which the noble Lord belongs, said, when he was praising this new Department, that it was charged with a massive and complex task which could only be discharged by a large and highly trained staff which had to be assembled and accommodated.

Finally, may I say a word about public ownership and control, to which reference has been made? It surely does not mean any increase in non-productive staffs if productive industries are nationalized and those who are producing there for are called civil servants or servants of the State. In fact it is highly probable that a nationalized industry will enable us to diminish the numbers employed, while increasing production, by getting rid of what I would venture to call redundant competitive staffs. There is an immense amount of waste in the mere fact of competition, and that would surely be partially dealt with by a concentration of industries in the best areas, thus doing away with waste in unnecessary transporc and in other directions. We have one example of this. In the 1914–18 war there was what used to be called the Liquor Control Board, and what is now, I believe, called the State Management Board or the State Management Association. That was an example of concentration. In the area taken over there were, at the time it was taken over, three distilleries and eight breweries. Production was concentrated into one distillery and three breweries. Immediately there was economy in labour, economy in manpower and economy in the period for which each of these productive groups was employed, with the result that that industry in that area now owns the whole of its assets and contributes in relief of taxation an amount which is now well over£300,000 a year, quite apart from what it contributes in Excise dues and so on by what is consumed. That is a pretty fair example of saving in man-power and in costs, and incidentally of the lowering of taxation.

The noble Lord said, of course, that he was in full support of the social services of the country, and so are we, and I am quite certain the noble Lord who will answer for the Government will agree with him on this point. The Election manifesto of the Labour Party used these very words: A better organization of Government departments and of civil servants, or work in connexion with the development of public ownership, is of vital importance. The Government's object may be to set an example to industry, and Government Departments do not always do so. I think the noble Lord was absolutely right in the illustration he gave of the typists, and I think he was right about the conditions under which many of the offices are at present working, but industry itself is not completely free from blame in this matter. I have been to offices in factories where conditions have not changed for something like 70 or 80 years, where there are still dark and dirty windows, unclean floors and bad lavatory accommodation. One mill to which I went had been closed down but had been re-opened for the war for the employment of 1,500 workers. The only lavatory accommodation for the workers was two earth closets in the middle of an open yard which had to be reached through rain and the cold. That is not a good example that private enterprise has set to Government Departments. Both have failed, but I am bound to confess I have never seen anything like that in a Government Department.

Finally, I would suggest that the Motion is not helpful in suggesting that the Civil Service is non-productive, but it is helpful in raising many aspects of a problem upon which the whole future standard of life of this country, and many other parts of the world, depends.

3.22 p.m.

LORD SALTOUN

My Lords, in rising to offer a few words in support of my noble friend's Motion, I want to say first of all, to clear away all misapprehension, that on every occasion when I have been privileged to work alongside civil servants, I have gained an increased and enormous admiration for the type of society which they produce. The exactitude of their minds, the accuracy and truthfulness of their thought, have always filled me with admiration. They remind me more than any other type of man of the praise which Walter Bagehot used to bestow on bankers.

My noble friend's speech reminded me of one of Dr. Bussel's very illuminating essays on the Roman Empire. In talking about the social change brought about by the institution of the Roman Empire, he said that society was divided into three portions. There was the general working population; there were a few wealthy people whose sole function it was to pay taxes; and there were the members of the administrative machine. Those of you who have taken the pleasure of dabbling in fourth century literature must be impressed with one thing, that the Roman State in those days produced just as much public spirit, just as much sense of duty, and just as much intelligence as did Rome in the days of the Scipios, but owing to the cumbersome nature of the machine, when pressure was brought to bear the machine could not stand up to it. When I look at my own country to-day I cannot refrain from drawing a parallel., and it is a parallel which has been enforced by my noble friend's speech this afternoon.

The functions of the Civil Service hitherto have been mainly administration and latterly, to some extent, and to a considerable and increasing extent, legislation, because there is far more legislation, and far more of the work of legislation is carried out by the Civil Service than really by Parliament. Britain 150 years ago was the admiration of Europe because she had settled law. Now to-day Britain may be the admiration of Europe, but it is not be- cause she has settled law, as the legislative flood which passes through your Lordships' House any week in the year will prove. Most of that is done by the Civil Service. I remember in the last Parliament an Act being passed in which I was much interested. I went to a member of the Department and said: "You have passed an Act with something in it which cannot be." He said: "We shall have to produce another Bill." That shows where the main work of legislation is. Parliament has not the time to go into the Bills the way it ought. Yesterday we had a Land Purchase Bill, and thirty years ago that would have been the subject of a very long debate in your Lordships' House, not because your Lordships own land, but because the principles involved are so large and so interesting. I am always very grateful to the noble and learned Viscount, Lord Maugham, when he intervenes on the Reading of a Bill, and when he sits down with the remark: "I am not quite satisfied." I always know there is real reason for what he says.

The point I want to enforce to-day is this. It is nearly fifty years since I first remember the phrase being used: "We have the finest Civil Service in the world; it is the most incorruptible; it is the most intelligent, and it is the best." That, I think, was true, and I think the same can also be said to-day. That was, I remember, the first time my attention was drawn to this subject. During the whole of that time I have never seen any case of the civil servant being dismissed—this is only my own observation—excepting for peculation, and I think the number of those cases in the whole of that fifty years can be counted on the fingers of one hand. That is a very remarkable achievement. It is a wonderful thing to have produced a Service with that tradition.

I am going to submit to your Lordships that if the trade and industry of the country are going to be brought within the range of the machine, the education of the civil servant must be to some extent altered. I will put it in this way. During the war on one occasion I had to take a long railway journey and I found myself in company with four other men. They were all men of the same type, what I call professional business men, and they were talking about the work they were doing in the war. It may have been very wrong, but there were no secrets being given away. These were all men who had, by their pencil signatures on a chit, authorized for their firms before the war an expenditure of tens of thousands of pounds. These men had been brought into the Government service and were doing very similar work for His Majesty's Government. I gathered that there were almost as many people checking their work as the people they were themselves supervising.

I can give you another illustration which many of your Lordships will perhaps remember. You remember that remarkable story by Bartimeus where the American purser, on one of His Majesty's ships, having to get fresh meat for his men, slew half a dozen sheep which he got from the Hebrides, and who was pestered by the Admiralty to account for the "arisings." He solved the problem by going into the slaughter-house at Dundee and buying a case of "arisings" and sending them to the Admiralty. The point I am making is that industry has never been run that way, and I do not think it can be successfully run that way. When you want to get a man for a big position in industry you do not pick a man purely for his honesty. You get a good character, you know his career, and when you have done so you do not subject him to absolutely foolproof checks. You have got your normal checks which are used in any case. You do not spend the whole force of your machine in seeing that he cannot get away with a sixpence. I do honestly think that some variation should be made, because I cannot feel easy at the thought that the industry of the country is going to be committed to the care of men for whom I have so much admiration but who do seem to me, in a very large degree, to be fettered in their decisions by the meshes of the machine in which they have been brought up, and to which they have been subjected from a very early age.

I should like to add a word to what my noble friend has said about Government offices. I think, and I have always thought—to take offices that I know pretty well—that the offices of the Inland Revenue, throughout the country, are absolutely disgraceful. I consider that something should be done to improve the offices of the Inland Revenue which I have been privileged to go into—and, as an accountant, I have had to go into a good many. As a matter of fact, I know that you get good work at those establishments, but it is a perpetual surprise to me that men who are subjected to such appalling conditions can produce the work they do. That is a matter which should be given very high priority, especially if His Majesty's Government are going to nationalize industry, for in that case these are people who should, at least, have decent rooms in which to work.

3.32 p.m.

LORD PAKENHAM

My Lords, I think we have all been very much interested by the speeches to which we have listened this afternoon. My noble friend Lord Marley has said many of the things that I had meant to say, and he has said them a great deal better than I had planned to say them. The speeches of Lord Balfour of Inchrye and Lord Saltoun were full of life, and they covered a great deal of territory very rapidly. If I may make a general comment, I would say that I respected their principles even where I could not share them, and I shared one or two of their prejudices even where I could not respect them.

I am sure that the House will not wish me to attempt to reply upon every topic that has been raised. To one in particular I shall have to omit any reference, though it is about the only subject which concerns us in public life with regard to which I am unashamed, ready to face the world and to submit to a complete scrutiny of my own record. I refer to the question of the birth-rate. Being, as I am, the possessor of seven children—though I am sure there are other noble Lords who can beat that figure—I can, at any rate, hold up my head and strut a little on the stage when that particular topic comes up. But I feel that that will carry us rather far afield, so I will simply say as regards the future of the population, that it is reckoned that the working population at the end of 1950 will be slightly greater than at the end of 1946, and that a slow decline will then set in. That is the position according to my official information.

Now let us look at this very wide and elaborate Motion. I have distinguished five propositions contained in it, and others were raised in speeches which have been made this afternoon. But these five, at any rate, I would suggest, have been offered for our inspection to-day. First, it is suggested that we are already confronted, and shall be increasingly confronted in the years ahead, with a serious man-power shortage. Secondly, it is suggested that the nation's man-power must, by some means or other, be used to the best national advantage, and attached to that is the corollary that there is a grave danger, to say the least, that the ideal distribution of resources will not occur unless we do something very drastic. Thirdly, it is suggested that there is considerable evidence in support of the view that too high a proportion of our very limited supply of man-power is likely to be used up in the Civil Service, partly, at least, owing to the specific programme of nationalization with which the present Government are associated. Fourthly, it is urged that every step possible must be taken to economize manpower in the Civil Service without lowering the quality of the Service. Fifthly, and lastly, it is suggested that an important means of reducing the number of civil servants or keeping the number down without lowering their total output would be to improve their conditions of service. These seem to me to be the five broad issues that have been raised. I am glad to have the assent of the noble Lord.

Let us first of all ask ourselves whether there is going to be a man-power shortage. Well, we know there is, because the Prime Minister has said so, and what is good enough for the Prime Minister is good enough for me and, I am sure, for all your Lordships. But let us ask ourselves further what a man-power shortage means—whether it is what is called a good thing or a bad thing. There is one sense in which we should welcome a man-power shortage. That is the sense in which it is simply another way of saying that there will be more jobs going than men to fill them, instead of, as in pre-war times, more men than jobs. In this sense to talk of a man-power shortage is simply another way of saying that we shall secure full employment, as all Parties in the country are determined that we must and shall do. But of course there is the other sense, the sense that the Prime Minister had in mind, and that I am sure the noble Lord had in mind. That connotes grave doubt as to whether we shall have enough people for the essential national tasks.

Of course, we shall never have enough people in this life for all the tasks that ought to be done. But, perhaps, we may make a very rough comparison between the end of the present year, when we hope to have reached a reasonable degree of stable conditions, and the position as it was in January, 1939. That seems to me, subject to your Lordships' views, to be the most relevant comparison for our purpose. I am not going to trouble your Lordships with many figures, but I would respectfully mark these first two figures with asterisks. At the end of the year we anticipate that there will be 20,000,000 men and women available for work, and anxious to work, compared with 19,750,000 in the middle of 1939. We shall be slightly up compared with the pre-war position, as far as we can see at present. Of course, that calculation depends on various factors which cannot be predicted with absolute certainty, such as the number of women who decide to stay in industry. What about those in the Services, and producing for the Services? Although before the war we had not as many in the Services as we shall have at the end of this year we had more people producing for the Services. The figure one can therefore eliminate for Service men and those producing for the Services is approximately the same in both periods. Speaking broadly, one may say that if we leave out these two classes we shall still be slightly up at the end of this year compared with the middle of 1939. That is the broad point I wish to emphasize at this stage.

Then of course there comes into the reckoning a set of imponderables on each side of the ledger. We have to expand our export trade to a figure more than 50 per cent, above pre-war, and that will probably use up 500,000 more men. We have to rebuild our country and re-equip industry, although we hope these emergency calls will be transitional.

On the other side of the account, none of us has any intention of allowing the country to witness a figure of unemployment such as we had before the war. Between the two wars the average unemployment was 14½ percent. In the years ahead some people think we are bound to have 3 per cent.; some say 5 per cent; some say a little more. But everyone agrees we shall have a considerable margin available, compared with pre-war.

Just before the war unemployment was 1,300,000, and obviously there is a big saving to be made there. Noble Lords will strike the final balance according to their temperaments—optimists optimistically, pessimists gloomily. All one can say is that there will be slightly more people available for work at the end of the year than just before the war. There will be larger tasks, but we shall save a good deal by making sure full employment is provided.

Coming to the second proposition I distinguished, we all, I am sure, accept the view that we must economize our manpower to the full. That goes without saying, although I think it is not something which would readily have occurred to us if we had been conducting this discussion just before the war. But how are we going to do it? That is the problem I would lay before you as worthy of your consideration, not only now but on subsequent occasions. It is all very well to say we shall secure full employment. I believe we shall. I do not believe, even with the restrictions inherent in a free society, that it is intrinsically very difficult to secure full employment. What is very difficult, and has certainly not been accomplished in any country under democratic conditions, is to make sure of the right number of people going into the various occupations. There is the real problem before you. I am sure that, not only to-day but on subsequent occasions, the Government will benefit a great deal from hearing the views of this House on that subject.

It is easy to say in a totalitarian State "We shall have 9,000,000 on productive work and only 3,000,000 on distributive work and work of that kind." But just before the war we found 9,000,000 were engaged on the production of goods for use and export and 6,250,000 in transport, distribution and other services. Here I must put in a caveat against the use of this word "productive"; at least I do not mind that so much as the use of the word "non-productive" which is used against those of us who do not indulge in manual labour. If we look at the position before the war, with the allocation I have mentioned between production and distribution, who will say that it was ideal? How was it reached? It was reached by the simple working of an automatic process. All your Lordships no doubt studied economics in your youth, as I did—although. I do not know if any had the pleasant experience of teaching them, as I did for my sins. It I may use the only Latin I have heard used in your Lordships' House: "Et ego in Arcadia uixi." I use it with deference to the noble Viscount, Lord Swinton, but if we are going to use Latin it is a great thing all to use the same.

VISCOUNT SWINTON

Never, as Lord Beaconsfield said, use a Latin quotation except one which has already received its full meed of Parliamentary approbation.

LORD PAKENHAM

I also taught economics at the London School of Economics. I do not wish to throw stones at the old profession but I would suggest to you that the modern economist such as the noble Lord, Lord Keynes, is a great advance on the old article. Before Lord Keynes there were only three great economists I ever knew of. Adam Smith was one; he believed that God was behind the economic system. The next was Ricardo; he believed that the devil was behind the economic system. The third was Karl Marx; he believed they took it in turns but that the devil was on top at the moment. We have passed beyond these ways of thought and are all now agreed that there is no invisible hand which will push and wheel the right numbers of men and women into the occupations most necessary to the nation. But how are we going to effect the right allocation between occupations without compulsion, as we are all determined to do?

I am not going to take up too much of the House's time and I have various points concerned with the Civil Service which I must come to. I would just indicate the two main lines on which the Government are thinking with respect to this problem. First of all there is the method of education, national propaganda and local guidance. I do not say pressure, but a good Ministry of Labour official, as the noble Lord, Lord Rushcliffe, knows, can steer an individual in doubt as to his true metier into an occupation suited to his capacity and of maximum value to the nation. There is a certain amount to be done by gentle persuasion of that kind, but we must have a broader policy than that, and I would give the name of the I broader policy which the Government are beginning to apply as "Relative attractiveness," We are trying to make occupations where manpower is short relatively attractive, compared with occupations where man-power is abundant. If I may offer a personal reflection I would ask whether many of your Lordships have considered what a change has inevitably come over the attitude to manual work with the development of education, particularly the development of secondary education in this century. There are bound to be many more people to-day who would rather do clerical jobs than manual jobs, and I feel sure that that has much to do with the reluctance of many to do the harder forms of manual work. We find it very difficult to get more coal miners, agricultural workers, cotton spinners, and men to work in the brickyards. It is also true, however, to say that we do find it difficult to get all the teachers and doctors required. It is not simply a problem of manual work, although quantitatively that is how the trouble shows itself most acutely.

As I say, I am only indicating the path, showing the signpost. Somehow or other we have got to work out a method of directing people into the occupations where labour is short. I would like to repeat, if I have not made it plain already, that the Government are fully seized of this problem, and are determined in each year to draw up a manpower budget, to look ahead to the end of the year, to try to indicate how they would wish to see the man-power of the nation distributed and how they expect that it will be distributed. That manpower budget will be quite as important as the financial Budget presented in the ordinary way.

I come now to the Civil Service and the third proposition indicated. A lot that is very pertinent has fallen from various speakers. Naturally the speech of the noble Lord, Lord Marley, was most to my liking. I quite agree that we must not regard the Civil Service as nonproductive, except in a technical statistical sense. Let us be clear, first of all, how far the Civil Service is in fact inflated. The last pre-war figure was just under 400,000. The war-time peak was 730,000, which was rather higher than the figure the noble Lord, Lord Balfour of Inchrye, mentioned for 1945. The present total—we are still talking, of course, of non-industrials—is 690,000. That means there is a reduction of 40,000 from the war-time peak, but an increase of 300,000 compared with the pre-war position. I am not trying to evade that figure. Let us fake it out and have a good look at it. But I do strongly resist the suggestion that the increase in the Civil Service is due to the policy of the present Government. I resist that as a statement of what has happened and I resist it as a prophecy of what is likely to happen. Let us look at the reason why the Civil Service is so large at the moment. First of all, they have got to wind up the war. They have got the task of demobilization, liquidation of war contracts, disposals, etc. Secondly, they have got to effect the transition to peace. These tasks have to be done quite irrespective of the particular Government that may happen to be in power. I am sure the noble Lord, Lord Balfour of Inchrye, appreciates that an exceptional burden is falling on their shoulders under those heads.

Then there is another reason, which is very important. They are compelled by the circumstances of the time, by the shortages arising from the war, to continue many controls in operation, and controls, as we all know, use up vast numbers of men. We need only mention food rationing. Noble Lords who have had experience of administration will realize the kind of thing one has in mind. All these reasons for inflation of the Civil Service have arisen from the events of the last six years. They would have arisen whatever Government had been in power. To those factors I should mention—this is not an inevitable consequence of the war but it flows from the agreed policy of the Coalition Government—the fact that the Civil Service of to-day has got to initiate important schemes of social legislation. Let me emphasize that word "initiate." Take industrial injuries, national insurance, the new health scheme and family allowances. There is no reason to suppose that any increase of staff that occurs at the beginning will necessarily continue. It would be very bad administration if all of it did continue. The great strain comes at the beginning. We must accept the fact that there is going to be a big increase of staff at the beginning. It is extraordinary how many people are needed to start a thing like family allowances, which might appear to be plain sailing. How- ever, once it is started it is very bad administration if you cannot bring about big reductions as you go along. But that factor, the increase of staff due to the initiation of new social services arises quite irrespective of the present Government.

What the present Government have done, of course, is to proceed with their election mandate to nationalize certain industries. I do beg of your Lordships—I did not notice any disposition to exaggerate points against us this afternoon—to go into the figures closely at your leisure and see how very few people in the long run are likely to be added, if indeed any, by a policy of nationalization. The noble Lord, Lord Marley, made what seemed to me a very effective point when he argued that under nationalization you cut out a certain amount of redundant competitive staff. I remember canvassing for a Labour candidate in Cheltenham in 1935 and failing to win over a local bank manager because he pointed out there were five banks in Cheltenham at that time, and under nationalization there would only be two, and he had no reason to suppose that he would be one of the two managers retained.

There are obvious reductions of staff of this kind from nationalization. There is a further point which I do not wish to stress unduly, but which I would like to lay before the House. It does seem to me that you will effect an economy in staff under nationalization compared with what you have got when the same industry is fully controlled. I am not comparing a nationalized industry with an industry when it is completely free from all controls, a condition which, in the nature of things, is the lot of very few industries at the moment. If you talk to civil servants who have played much part in controlling industry during the war, you find that in many cases under a system of full controls but not nationalization you get a civil servant whose special job is to watch an employee in industry. In the technical jargon of Whitehall they are married to each other. Sometimes I am afraid it is rather a misalliance and it is necessary to effect a divorce. But you have got two employees, one a Government servant, one an industrial servant, both in a sense doing the same job. I lay that before your Lordships, without wishing to place too much stress on it, as one reason why an industry that is nationalized is likely to use up less staff on balance than an industry under full control.

I do not suppose your Lordships wish me to reiterate all the points I made on a previous occasion when we were discussing the Civil Service. I argued then that the Government were doing all in their power to make the Civil Service as efficient as possible, under the headings of recruitment, training and organization. Under the heading of organization I think I should just remind your Lordships that during the war an organization section was introduced and has grown up in all the main Government Departments. It is usually a part of the Establishments Branch, and great stress is now laid on all the Departments, certainly those which I know best, on the importance of the work with which the organization section is charged. They conduct periodical sweeps throughout Departments to see whether or not man-power can be saved, and, if it can be saved, how that can best be done. I mention that in passing. I would also mention what is of course familiar to your Lordships but perhaps not so familiar to those who have not been concerned with the Civil Service that is the increased recognition in the Service of the importance of getting an absolutely first-rate man as your Establishments Officer. In the old days you turned an old servant into an Establishments Officer rather as you turn an old horse out to grass. But now all that is changed, and the Establishments Officer is regarded as one of the most important individuals in any Government Department. I would further briefly remind your Lordships that the Treasury are introducing, or rather re-introducing, a measure of the scrutiny of the amount of man-power in the Service which was inevitably suspended during the war.

I come fifthly and finally to the question of rates of pay and conditions generally. The noble Lord, Lord Balfour of Inchrye, raised what seemed to me a very pertinent issue in that connexion. We must all ask ourselves all the time how the competitive pull of the Civil Service compares with the competitive pull of other occupations. That is the standard that the Government set themselves and it is a question that is bound to be in all our minds. If the noble Lord, Lord Balfour of Inchrye, or other noble Lords will at any time bring to my notice or the notice of other Government spokesmen, cases where judged by this standard they consider a grade in the Civil Service is seriously underpaid, I am sure it will be looked into.

If I might just refer to the three specific cases he raised, I would first say I wonder on reflection whether he would still maintain that very top civil servants ought to be reduced in number. We had it argued in a previous debate by a noble Lord, who spoke from first-hand experience of running a Government Department during the war, that the heaviest burden of all falls on the Permanent Secretary, and I should be inclined to wonder whether the noble Lord would press this point of his. My own feeling is that the top civil servants are more overworked than any body of men in this country.

The noble Lord then came to the scientists. Without knowing all the circumstances I can inform your Lordships that the position of the scientists in the Civil Service has been very much improved. The noble Lord mentioned that there had been some improvement, but he also mentioned that the relevant organization representing the scientists was not satisfied. I understand that the present position is that they have now become satisfied with the rates of pay, but they are still discussing the complements, and the various grades; and the position, therefore, I would suggest, is perhaps rather more favourable from their point of view than it appeared to be to the noble Lord. But certainly, in the view of the Government, the position of the scientists has improved remarkably, not only in rates of pay but in career prospects; the changes introduced at the end of last year were specifically undertaken with a view to improving the scientists' prospects.

Finally, we come to the typists. Everybody is short of typing staff, and as we know, we cannot get very far without it. The position there, according to the best information at my command, is that the prospects of a typist in Government Service are at least as good as, probably better than, those in the employ of the large firms. But neither the Government Service nor the big firm can compete at the moment with the small man. The real pull on the typists comes from the comparatively small employer who is ready to pay them a good deal, and although he gives them no security he can lure them away from the Government and the big employers. Pertaining to the general subject, may I outline the Civil Service conditions generally? As the noble Lord is aware, machinery exists for improving these conditions by negotiation. The war bonus was recently raised and consolidated so that civil servants received a consolidation of bonus which, in the case of the lower paid civil servants, amounted to something like 50 per cent. In the case of civil servants earning £1,500 a year it was more like 8 per cent. The percentage increase tended to fall as you went up the scale. As regards conditions in general and pay in particular, the machinery will be used to the full in the future as in the past and there will be no question of the Government claiming that any finality has been achieved.

In conclusion, I will say that the Government are grateful for the opportunity provided for discussing these matters this afternoon. We all recognize the vital necessity of using our manpower to the full, but the Government are determined to do it without sacrificing any of our freedom. If we could introduce totalitarian methods, of course, the problem would be comparatively easy. But we are determined to bring about this full employment and optimum distribution of resources without sacrificing one iota of freedom, which makes it all very much more difficult but infinitely more worth while.

4.5 p.m.

LORD BALFOUR OF INCHRYE

My Lords, we have had an interesting debate, and I am grateful to the noble Lord, Lord Pakenham, for his ventilation of the problems that have been raised to-day in so far as the Government are concerned, and also, I am sure your Lordships will agree, for the gay, refreshing and informative contribution the noble Lord has given. As the noble Lord, Lord Pakenham, said, you can put what interpretation you like on many sets of figures and strike any balance you like. I only hope that the reassuring attitude of the noble Lord will be maintained in the future. The noble Lord, Lord Marley, said that I had left out any mention of the disproportion of men employed now and to be employed in future in distribution, but I only did it out of consideration for your Lordships, not wishing to cover too much ground. He gave a doctrinaire example of the economy of man-power. Three distilleries and eight breweries had been nationalized. These had been brought down to one distillery and three breweries. I think he might have mentioned the consumers because we did not know whether they were getting as good a service.

LORD MARLEY

The service in the Carlisle area is better than any I have known in the country. Admirable little hotels, and public houses and places for food, tea and coffee, and special places for women and children. I recommend a visit to Carlisle to see.

LORD BALFOUR OF INCHRYE

I shall look forward to a visit. I should like to thank the noble Lord, Lord Pakenham, also for his point about the conflict between the freedom of choice for a job with the policy of full employment and nationally planned economy. It is a great problem. I hope we shall discuss it attain in this House. I thank your Lordships for allowing me to bring forward this Motion, and as I gather the Government do not wish to accept it, I beg leave to withdraw it.

Motion, by leave, withdrawn.