ADDRESS IN REPLY TO HIS MAJESTY'S MOST GRACIOUS SPEECH.

HL Deb 22 October 1947 vol 152 cc88-158

2.50 p.m.

Debate resumed (according to Order) on the Motion moved yesterday by Lord Dukeston—namely, That an humble Address be presented to His Majesty as followeth—

"Most Gracious Sovereign—We, Your Majesty's most dutiful and loyal subjects, the Lords Spiritual and Temporal of the United Kingdom of Great Britain and Northern Ireland, in Parliament assembled, beg leave to thank Your Majesty for the most gracious Speech which Your Majesty has addressed to both Houses of Parliament."

LORD RANKEILLOUR

My Lords, I desire to take up very little time on the question of Burma. I will not discuss the policy of the Government on this occasion; I will only remark that recent events in Mandalay do not appear to constitute a happy augury for peace and harmony under the new order. I would, however, ask certain questions, as the statements which have been made by the Government and the allusion in His Majesty's gracious Speech do not give us much information as to the detailed working they expect the new order to take. May I remark on what is perhaps more a technical matter, that in a similar case, that of the Irish Treaty—of course that differs from the Burman Bill in that it is, I understand, intended to be a confirmation of a Treaty—although the Treaty could not be altered at the time, the enacting words covering the Treaty were amended both in this House and in another place, and also, if I am not mistaken, an amending Bill was almost simultaneously passed to cover up anything that was wrong or defective in the Treaty as originally agreed to.

There are three subjects on which I desire some further enlightenment. First, there are the officials who have served in Burma but who do not come under the description of Secretary of State's servants. Nevertheless they have served in the essential services in Burma and, according to the information I have, they are to be dismissed without any compensation or pension and without any promise of further service. Many of them have served for a long time in the Burmese service and are men of middle age who will find it difficult to find other suitable employment. I trust my information may be wrong, or that, if it is right, the position may still be corrected.

I should like to know something about the question of the defence of Burma. I am no strategist, but I have obtained such information as I could from soldiers, some of whom took part in the fighting, and I have come to the conclusion that the vulnerability of the Burmese frontier is far greater than that of the Indian frontiers, at: any rate in the north-west. If I am not mistaken, not only did the Japanese Army come in from the south-east but a considerable force was able to get far into Burma from the north-east. I can only ask whether the Government have taken these matters into account and whether they think that the new State of Burma can find its own protection on the north and east.

But what I am most concerned with is the question of minorities in Burma. The position is very similar in essence to the Indian position, save for one great difference, that in Burma there is no great homogeneous minority that can take care of itself and set up for itself, as there was in India. Nevertheless, there are large minorities. According to the best information which I could get, but which is probably out of date as it is based on a census taken several years back, there are some 1,200,000 Karens, nearly 900,000 Indians, 120,000 Indo-Burmans and 130,000 Chinese. There is a distinction among the Karens. In the north they have a comparatively small homogeneous territory for which I understand they will be allowed separate rights, but by far the greater number, which on the basis of my information I put at 1,100,000, lie mixed up with the Burmans in the plains, and it is for them as well as for other minorities that I would most sincerely plead.

What safeguards will there be for them and for their rights? I am afraid I have said this several times before, but even if I drive your Lordships to an extremity of boredom, I must say it again. The only safe protection for minorities lies in a fixed Constitution with organic laws. Outside this House, if you attempt to talk about fixed or fluid Constitutions, even with a person of the highest education, who has not. given any special attention to this matter, you are stared at with a look I can only describe as one of goggle-eyed stupidity. People do not seem to understand the difference, and I think the difference is essential. If, for example, in this Burmese Constitution there is a section saying that there should be no discrimination on the ground of race or religion, that is no use unless it is embodied in an organic law. If the legislative body can change the Constitution as and when they choose, on the long view at any rate and maybe on not so long a view, the safeguard is worthless. Besides which, it must be interpreted by an independent supreme court. The model, of course, for a fixed Constitution with organic laws is the United States of America. Although organic laws are not always properly applied, they are a very great safeguard, not only to the minority principally concerned but also to the minorities who might be unpopular at the time. Therefore I would ask the noble Earl who is to speak for the Government, what are the safeguards embodied in the Agreement, and how is the intended Supreme Court to be constituted?

I shall not go back to the position of India, but I must express the opinion I expressed before, that the abandonment of India was a grievous national sin, and although in Burma the tragic consequences may be on a lesser scale and may be much longer deferred, all the elements of future trouble are there. I therefore put these three points to the Government.

2.59 p.m.

LORD STRABOLGI

My Lords, as there is a long list of noble Lords who are going to favour us with their views, I propose to be as brief as the noble Lord who has preceded me. As the noble Earl, Lord Listowel, is to reply, I had intended to begin my remarks by congratulating him on his recent visit to Burma and the arrangements he appears to have made there. I still mean to do so, in spite of the remarks of the noble Lord, Lord Rankeillour. Lord Rankeillour, with full justification, raised the matter of the minorities in Burma. I do not know if the noble Lord met any of the Burmese Ministers who were over here recently. I had the privilege of meeting some of them, including two Ministers who were members of these frontier tribes or minorities and who appeared quite satisfied with the safeguards for their people. One of them is the Minister of Labour, and in physique a smaller edition of my right honourable friend Mr. Ernest Bevin. I hope he will be as successful a Minister in Burma as Mr. Bevin was during the recent war as Minister of Labour here. I do congratulate my noble friend on having obviously won the sympathy and trust of the Burmese, and I am sure that will have good results in the future.

I rise to deal with two of the economic matters which play such a great part in the gracious Speech. I have given some notice of what I am going to say, and I hope to get some satisfaction on at least one point. The first is a matter of avoiding a waste of man-power and of dollars. I refer to the proposal to wind up the Petroleum Pool, I believe at the end of this year. I know nothing at all about petroleum except as an ordinary user of petrol. I know very little about the by-products of petroleum, or lubricating oil, or anything of that sort, and I have No 1nterest in it whatsoever except, as I say, as a motor user. But I am informed by people who are in a position to know these things, who have spent their lifetime in that great industry, that the Petroleum Pool is working perfectly well, and to wind it up now and allow a great number of separate companies—I believe there are nine great companies selling petrol, twenty-five selling lubricating oil, and something of the order of 200 selling the various by-products, from medicinal paraffin to the ingredients of paint and chemicals—to carry on, would be a great waste of man-power.

It would mean taking on salesmen, advertisers, and so on, who are doing other work at present and can be better employed. It would mean, I am informed, that all these companies would have to carry greater stocks, which are at present carried by the Pool, and this would mean a loss of dollars. I understand the decision was taken more than two years ago. I submit to my noble friend and the Government that the situation has somewhat altered in the last two years; that this policy should be looked at again and, if it is not too late, that the Petroleum Pool should be kept on and in being. I hope noble Lords opposite will not say that I am advocating the maintenance of unnecessary control, because the people who are in a position to know assure me that it works quite smoothly, and it is not one of those vexatious, bureaucratic organizations which are alleged to hinder industry. That is not the case here, and I hope the matter will be looked into again.

The other matter is far more important. I must confess that I feel here a great sense of disturbance. I do not want to criticize His Majesty's Government in this particular case at all. Far from it; I want to support them. They have had very great difficulties with regard to Germany, which is the subject of the few further remarks I intend to address to your Lordships. They inherited the Potsdam policy; they have had troubles with their Allied and Associated Powers, and altogether a most delicate situation to handle. Nevertheless, after twenty-seven months since the close of the war, it is now announced that it is proposed to dismantle—I take the figures from the account given of it in The Times, from their correspondent in Germany—682 factories in the British and American zones. I understand that the original figure was over 900, and that His Majesty's Government have persuaded their associates (they are not alone in this matter, and I am not distributing blame at all) to reduce the number to 682. If it is a matter of dismantling factories that can only be used for warlike purposes, there can be no dispute whatever about that; they all ought to be scrapped. Plants making armoured plate, for example, or boring heavy guns, obviously cannot be used for anything else, and they ought to go. I understand that a good many of them have gone.

But the group of factories it is proposed to dismantle, and in some cases to transfer to other countries as reparations—not all to this country; only a fraction comes here—include 302 war factories; and I understand that some of these could be transferred to civilian production, as is the case, I am glad to say, with many of our own ordnance factories which have been put to most valuable use turning out civilian goods. The next group consists of ninety-two factories making the various products—semi-manufactured goods—of non-ferrous metals. A number of your Lordships play a very great and useful part in the industrial life of this country, and if any of those noble Lords are present they will bear me out, as every other man who has anything to do with production will also bear me out, in saying that there is a tremendous shortage, not only in this country but all over the world, of non-ferrous metals and especially semi-manufactured products. The time of delivery of certain semi-manufactured non-ferrous metals in this country is something like eighteen months, and this is holding up the export trade. The shortage is worldwide, and to dismantle or transfer ninety-two non-ferrous metal factories in Germany in the present state of affairs is, I think, a mistake. I hope that matter will be looked into again.

Then I come to the third group, which consists of 224 factories engaged in mechanical engineering. These are civilian factories engaged in production. The great need of the whole of Europe to-day, including this country, is production. Unless we can improve and increase our production Europe will come to ruin. We all know that; there is no dispute about it. It is suggested that these factories be dismantled with skilled labour. The official figures of skilled labour required for the British Zone only is 30,000, and I am told that it will probably be more. You cannot put ordinary labour on to dismantling a delicate machine; you must have the skilled mechanic. Then the parts have to be packed into rolling stock—goods waggons—which do not exist. There is a terrible shortage of rolling stock all over Europe, which is one of the principal difficulties in the way of recovery. I have heard whispers that there is a shortage in this country, too, and I hope that we shall not have to send any to Germany to transfer the parts of this machinery. Then they will have to be re-erected in the countries which are to receive them. I understand that 25 per cent. of the machines will go to Russia, though I am also told the Russians have done very well out of the machinery and plant in their own zone. Nevertheless, under the Potsdam Agreement, twenty-seven months old and. I claim, somewhat out of date now, 25 per cent. will go to Russia, and other very large fractions to neighbouring countries who suffered under the German occupation. The time estimated is two years, though it may be more. That means, supposing you take a middle figure, and dismantle a factory turning out boots and shoes—it does not matter what it is—and send it to Belgium, the process takes eighteen months. You then have to train a new team of workmen, and all that production is lost during the next eighteen months, which are critical for the survival of Europe. Nobody will dispute that.

I have gone into this matter myself because, like others of your Lordships, I have been hard put to it in my own business for semi-raw materials, and we have been looking into the German position to see if we could get some there. We should get a very great deal. I have made inquiries this morning and I do not believe that any of the firms on the list are those with whom we had expected to do business so I have no direct interest in the matter. I want to make that quite clear. I would like to say that in our investigations we had the greatest help and assistance from the Control Authorities and the British officials in Germany, and from the British officials on this side. We have pointed out that if we get certain raw materials from Germany in the form of semi-finished goods, we can increase our production in this country and, help exports. We received the fullest assistance there, and I have no grievance whatever.

I am looking at the matter from the broad point of view, and I am speaking with some knowledge for the reasons I have just given. I understand that the aggregate value of the plant to be dismantled is of the order of £200,000,000 or £250,000,000 which is a very great deal. There is a shortage of skilled labour to do the work, shortage of transport and, as I said, a shortage of production in Europe. Now it may be said: "Oh, yes, but this was the Potsdam Agreement, and we have to keep our word." We have kept our word right through, and I wish other nations had always done the same. We have been most punctilious ever since the end of the war in keeping all our commitments. I suggest to my noble friend that conditions have changed since the Potsdam Agreement, and that the state of Europe, and particularly of Germany, is such that we cannot afford to carry out this policy.

If reparations are required they can be. obtained in consumer goods, and if possible we should avoid the dislocation and upheaval in Germany, not to mention the psychological effects. I do not want to dwell upon that danger, but I think it should be avoided if possible. I do make a plea to my noble friend and the Government to see if this programme cannot be reconsidered. No policy is irrevocable. The idea that, because you said you would do something two-and-a-half years ago, you must still do it to-day under entirely different conditions in the present state of the world, is, I suggest, untenable. I am sorry if I have spoken rather strongly on this matter, but I feel strongly that this is a mistaken policy which may lead to great friction and great difficulty. I am going to say this to my noble friend. I do not believe that in the end it will be carried out, I think this winter is going to be such a testing time in Europe that this and many other products of the war neurosis of two-and-a-half years ago will disappear. Is it not better to say: "This would be a mistaken policy, so at any rate let us postpone it and give these people a chance to produce the goods for which all the world is crying out and which may help them to buy some of the food with which at present we have to provide them"? I apologize for raising this matter, but for the reasons I have given I hope it will be given the most sympathetic and urgent consideration.

3.14 p.m.

THE MARQUESS OF READING

My Lords, looking back upon yesterday's debate I have come to think that perhaps those who spoke from the Opposition Benches were a little hard upon His Majesty's Government, who deserve commiseration rather than condemnation. After all, here they were with one crisis, a coal crisis, behind them, with another crisis, an economic crisis, all about them; and then suddenly out of the blue overnight, or anyhow over the week-end, bursts upon them the new vast momentous crisis of this menacing struggle of the Peers against the people. No doubt if their thoughts had not been diverted by this titanic spectacle they might have found time in the gracious Speech to give some consideration to matters such as that raised yesterday by the noble Lord, Lord Schuster, of the implementation of the Rushcliffe Committee's Report. But after all, what is the effect for a considerable number of people of being debarred either from obtaining their rights or defending their rights owing to straitened means, when you are faced with a crisis of this magnitude!

They might possibly have wished to consider the recommendation of another Committee which has been discussed in this House, to make some provision in law for the establishment of a marriage guidance service, considering that there are 50,000 divorces in a year. Of course, when the whole foreground of the scene is occupied by this vast looming shape of constitutional struggle, they had no time for such trivialities! There are a great number of lives wantonly sacrificed every year upon the road. The Government have recently had a Report from an expert Committee, confirming, incidentally, many of the recommendations of the Alness Report of nine years ago. No doubt they would have wished to give substance to those recommendations had not their thoughts been diverted to other and more momentous topics. In those happy and remote days when they were in Opposition, they talked loudly about the need to separate the functions of the Minister of Health into a Ministry of Housing and a Ministry of Health. No doubt, had they had the time, they would have desired to carry into practice that cherished wish. But of course Constitution must come first, and they cannot let their thoughts be diverted to such insignificant themes.

I wonder if there has ever been a debate upon an Address in which, with all the eloquence that they expended upon it, the mover and seconder of the Address felt that their lips were sealed against any reference to the first piece of legislation contained in the gracious Speech. If I may say so, I think they were wise in their generation, for truly there never was a more artificial and disingenuous issue put forward to the electorate of this country. If the Government really believe that the people of this country are so guileless and gullible as to swallow this particular measure as a matter of urgent political conflict, they are paying no high compliment to the intelligence quotient of the people of England.

It is perhaps worth while spending a few moments considering the reasons which led to the introduction into the gracious Speech of this particular measure. Although, inevitably, it must be largely speculation, there is none the less a certain amount of circumstantial evidence, and I am in the happy position of being able to agree in large measure with the causes attributed not only by the noble Marquess, Lord Salisbury, but also by my noble friend Viscount Samuel. Let us remember that not very long ago there was a rearrangement of the Government. It cannot be said that it got off exactly to a flying start. In fact, there seemed to be a certain number of false starts, which may have been due to the fact that some of the runners refused to come under the starter's orders at all. But they did get off in the end; and what was the result? A. certain number of Ministers found themselves somewhat peremptorily cast into the category of displaced per- sons, and their places were taken by a few more horny-handed dons.

And as a last supreme effort the Minister of Fuel and Power was dislodged from his office and consigned to the War Office, which no doubt he will administer on the best "Shinwellington" lines. There remained the Minister of Health; and it must be a solace to him to think that he has at least built something so seemingly permanent as his own position in the present Government. The Minister of Health very properly prepared the way. He even thought it necessary to declare at public meetings that he desired to remain where he was—which, I take it, translated into plain Welsh, means, "I dare you to move me." And they did not dare to move him; and there he remains, with all the added impregnability of having survived that crisis.

But equally the Minister of Health has made no secret of the fact that what he wanted was the nationalization of iron and steel, and that he wanted it now; and he has not got it. Somehow the Prime Minister steeled his heart and the iron entered Mr. Bevan's soul. But there was always the danger that he might become obstreperous, and therefore it was necessary to offer, I will not say in this context a sop to Cerberus; let us rather say, a bonus to Balbus, because those of your Lordships who are classical scholars will remember that Balbus was also in his day a great builder—anyhow of a wall; I do not think it is recorded that he ever had to his credit one complete dwelling house.

Mr. Bevan is not amongst the more pachydermatous of his colleagues in the matter of sustaining criticism, but if he makes the kind of speeches which he has made recently he cannot expect wholly to escape. I quote your Lordships this speech, not for its intrinsic oratorical beauty so much as because it is part of that circumstantial evidence upon which I rely and also because it is an instance of the gaseous rhodomontade that we shall be treated to if this issue is going to be fought out in the country. Speaking at Morpeth on July 19 Mr. Bevan said: In the last few months there has been increasing evidence that we might have trouble with the House of Lords. I want to make this clear, and I think it is the view of the Government, that if the House of Lords dares to stand between the will of the people and what they desire then it will be the end of the House of Lords. We are not proceeding merely to nationalize the steel industry because of some theory, but because we be- lieve that it lies at the basis of many other industries, that it is a great monopoly, and that we cannot trust the manufacture of steel to the steel lords who, in the past, have made large profits by not making steel. Therefore, if the House of Lords, as the last refuge of ignorant reaction, stands in the way, then we shall take whatever steps are necessary to set aside its power. Mr. Bevan continued: It may not be necessary to entirely shut it up. Our Constitution has undergone many changes. We might leave them with a toy, but take away the sword. Mr. Bevan has not, apparently, from what we were told last night, got all that he and his friends want. Let us therefore for a moment consider what are the implications of the statement made by the noble and learned Viscount on the Woolsack. Before I pass to a brief consideration of his speech, I would ask one question of the noble Earl who I understand is going to reply for the Government. As the noble Marquess, Lord Salisbury, quoted yesterday, in their manifesto Let us face the future the Labour Party said: We give clear notice that we will not tolerate obstruction of the people's will by the House of Lords. What I would like the noble Earl to tell us when the time comes is this. Does he claim, do the Government claim, that in the existing circumstances—the action of this House on any future Bill being entirely hypothetical and possibly never coming to fruition—that at this point of time, the Government has a mandate from the people to alter the terms of the Constitution?

May we very briefly consider what was said yesterday, when one corner of the iron and steel curtain was lifted and we were allowed to see what was behind? The spectacle of a brave man struggling with perversity is always a painful one. But with all respect to him, I think all your Lordships who were present last night must have gone away feeling that never before had you heard the noble and learned Viscount the Lord Chancellor so unconvincing, because so unconvinced. I have heard other great advocates in the past plead a bad cause and I still recognize some of the symptoms. What did the noble and learned Viscount say? Do any of your Lordships imagine that you can fairly say that that controversy"— that is the old Lords versus people controversy— is stilled to-day? … Believe me, it is the fact that there are those who do not think that we are such admirable people. What is the meaning of that? It means surely this: "We, members of the Government in this House" and I think it right to say, from what the Prime Minister said last night, in the other place as well—"know that this House has a valuable task to perform, and that it is performed with efficiency and to the general satisfaction." But it means something more. It means that the Government's followers had not fully absorbed that doctrine, and that not for the first time in the history of this Government Ministers are stampeded by their followers. It means this too, that those Ministers, for all the statements that they have made in praise of the work of your Lordships' House, have neither the strength nor the courage to stand up to their followers and to say, "This is a baseless controversy. This Chamber is doing its work admirably well."

A little later the noble and learned Viscount, the Lord Chancellor, went on: Would it not be well—I put this to your Lordships quite frankly—if we could end this controversy for another thirty-six years by reducing the time within which you can hold up a Bill from two years to one? We have already heard in a speech earlier this afternoon something about guarantees in a different context. What makes the noble and learned Viscount think that if the Government were successful in reducing this period from two years to one, that would bury the controversy for another thirty-six years? We shall not always have Ministers perhaps so moderate, so docile, and so public-spirited as the present. What is to guarantee that in six months time the Government will not say: "No, a year is too much. Let us have it down to six months."? Then, in another six months time, "Let us take away this period of delay altogether and reduce it to nothing." What conceivable evidence is there that any such measure as is contemplated in the gracious Speech would be efficacious to still this controversy for another thirty-six years, or even for another thirty-six days?

The noble and learned Viscount, the Lord Chancellor, later said: After this Session of Parliament … when we have run three years, there is no Bill which can be put through by the other place without the consent of this House. That statement drew intervention by the noble and learned Viscount, Lord Simon, who pointed out that that was not an accurate statement because the period of time can be carried over from one Parliament to another. I should not for a moment suggest that the noble and learned Viscount on the Woolsack was unaware of that section of the Act, but I would suggest this: if Ministers are really so concerned about the possibility of carrying over from one Parliament to another, it might possibly indicate to some of your Lordships that they are not quite so convinced that in the next Parliament they are going to have a majority, and that from their point of view, it is very important that any measures which they desire to pass, whether the electorate have been consulted upon them or not, might well be thrust through in the life of the present Parliament.

The Lord Chancellor went on to say—and this is an interesting phrase—in answer to Lord Simon's interruption: I do not suggest that there is any danger of losing a Bill. Let us bear that very valuable phrase in mind. A little later he said: One does not know what might happen if that group of people who used to be referred to, I think, as backwoodsmen come up and take charge of the situation. It was pointed out to him at the time that that was a complete and utter shifting of ground, that he was moving from the question of powers to the question of composition.

The Lord Chancellor went on with an almost more remarkable sentence. There stood up in your Lordships' House a Socialist Lord Chancellor defending and patting upon the back the hereditary system. I, too, remember the days of the 1911 Act to. which the Lord Chancellor referred, and the campaign that preceded it, and I am bound to say that, whatever strange metamorphoses time might bring, I never expected to attend anything more edifying as a spectacle than that. The Lord Chancellor said: I think they"— that is the Second Chamber— must be able to hold up a Bill for a limited period of time with all the disadvantages. That is the present position. That would presumably be the position with a difference in the limitation of time if this new Bill were to become law.

But yesterday, also, the Prime Minister in another place made a speech and he said this: If, as I hope, the Members of another place are not inclined ever again to exercise those menacing powers in order to render nugatory the decision of the elected Chamber, then our proposals will do them no harm, but we shall be taking away a weapon which they have No 1ntention of using. If, on the other hand, they still have the intention to reassert those powers, which of late have fallen into desuetude, then this Bill will be most effective and timely. What is that saying? It is surely saying this: that there is a failure to recognize that the great effect of the 1911 Act was to remove the veto altogether, and that all that is left is the statutory power of this House to reject a Bill three times and then, if it comes within the prescribed limits, see it passed over its head.

Those were the terms in outline in which this new proposed Bill was commended to us yesterday. At the same time we read and hear a good deal about national unity in the face of a crisis. Ministers quite rightly expect the united efforts of the country in many of the great enterprises which they have been bound to undertake. They expect every assistance that they can be given in the export drive and in many other aspects of national life. But when they seek to promote that unity by the intrusion of a fictitious, counterfeit and bogus issue of this kind, it is futile to turn to the country and plead that they should have the united backing of all Parties in their undoubtedly arduous task. May I commend to the members of the Government a very salutary exhortation used only a few days ago, although in a different context, by the Lord President of the Council: "In the national interest, stop this nonsense."

3.38 p.m.

VISCOUNT SWINTON

My Lords, before I come to more criticism which I am afraid I shall have to offer of the most gracious Speech, I should like in much more than a formal manner to associate myself with all that has been said of the speeches of the mover and the seconder of the Address. We know both the speakers well; one we have known for quite a long time, the other we are getting to know almost equally well. I cannot pay a higher tribute to them than to say that in what I think is a most difficult job both have maintained their reputation for debate in this House. It is particularly remarkable on this occa- sion, because I do not think I have ever, in a fairly long Parliamentary experience in both Houses, encountered a gracious Speech more difficult to commend in suitable terms. I think the gracious Speech drafted by His Majesty's Ministers has been greeted not only by both Houses of Parliament but by the country with equal surprise at what it omits and at what it contains.

The Speech opens not inappropriately with these words: In the Session which opens to-day the nation is faced with grave economic difficulties affecting almost the entire world. Those words might very well have been in the Speech last year or even in the Speech with which the new Government greeted a new Parliament. One of the leading spokesmen of the Government, I think, on a different occasion said: "The trouble is we have always been a move behind." I am not going to dissent from that statement; I would say that it is a very modest under-statement of the position. If for "a move behind" they substituted "a year behind," or even "two years behind," I think there would be a good deal of evidence to justify the statement. I pause in passing to draw attention to another remarkable passage in the gracious Speech, which says that we shall play our full part in leading the world back to prosperity and freedom. The Government seem to be taking a very curious course to lead the world back to freedom. Of course, in an Einstein and troubled world all expressions, I suppose, must be considered in an atmosphere of relativity, but it does seem to me that the imposition of what is virtually industrial conscription and still more controls is a strange way of leading the world back to freedom.

Language in Government jargon really seems to lose its normal meaning. But there is one thing in the gracious Speech with which I most cordially agree, and that is the statement or the suggestion that the crisis overshadows all. All our efforts, the efforts of Government, of Parliament and of the people, should be concentrated on its solution. But from the preamble to the operative part of this instrument, what a change! Can anyone—not a hard-bitten Party politician but any impartial person, any ordinary Englishman, looking for a lead, looking for guidance, wanting nothing but to play his part and do his job—hearing this Speech which has been drafted by the Government as their last word (indeed it was only completed, if rumour is correct—a unique experience—on the eve of the meeting of Parliament) and as representing their plan for this critical year, feel that here is a plan of campaign, that here is clear and stirring leadership in a great combined operation? My Lords, we and the country cannot take our minds off this crisis, however much the Government may seek to divert us to irrelevant issues.

The Lord Chancellor in his speech asks us not to be pessimistic. I am bound to say he did not give us very convincing reasons for optimism, but I think he was mistaken in the reason for our pessimism. We are not pessimistic about our country or our countrymen. What we are pessimistic about, and with reason, is His Majesty's Government. The crisis, serious as it is, is completely solvable by the right measures and the right spirit. Given those measures, given the spirit and the leadership, the crisis can be solved far sooner than many of us would believe. It is in that mood that the House rightly takes advantage at the earliest opportunity, as we shall take advantage of other opportunities, to get the full facts, many of which are still hopelessly obscure, and to elicit the plans and proposals which, in spite of this lengthy Speech and that of the noble and learned Viscount, are still undisclosed.

I think the country was honestly disappointed that we had no answers when we met on the last occasion. I do not believe that the curious attitude of the Government, with its sealed lips and its attempt to snub this House, was much appreciated in this country or outside it. On higher authority on that occasion the Acting Leader's lips were sealed. To-day the Secretary of State for Burma, the late Secretary of State for India, suffers from no such inhibition. His day of silence is passed, and he will be able to answer us. Therefore I make no apology for returning to some of the questions which were raised on that occasion because, as Lord Salisbury showed yesterday in his remarkable speech, this is an occasion, and a proper occasion, upon which we should cover a fairly wide field.

Therefore, I make no apology for returning to the questions which I then asked, and which have remained entirely unanswered here or anywhere else, about the expenditure of the American and Canadian Loans. All is blamed on a shortage of dollars. There is no doubt that dollars are short, but the Government blame that as something which came upon us, so to speak, as an "act of God" or of some other providence over which they had no control, much as Mr. Shinwell blamed the weather for our coal crisis in the winter, and now blames the Civil Service. But I would like to ask this, and it really is a question that one is entitled to ask: Are we short of dollars because the Chancellor of the Exchequer not only miscalculated, but mismanaged and wasted valuable resources, just as the Government have wasted precious time?

The last time we met I quoted figures of Mr. Harrod. Perhaps I paid Mr. Harrod too much of a compliment. I should have said they were the figures of the Chancellor of the Exchequer himself, because what Mr. Harrod has quoted were the figures which the Chancellor of the Exchequer had given in a most carefully considered statement made in another place just before that place adjourned last August. Those figures of the Chancellor showed perfectly clearly that out of a total combined credit—and the Chancellor said quite rightly that we must take the American and Canadian credits together—amounting to £1,250,000,000, £550,000,000 had been expended on direct purchases on behalf of this country and for the rest of the sterling area. Even if the Chancellor made a mistake—and I am not saying he did—he has certainly taken no opportunity of correcting it. Even if he made a mistake in what he said was the total expenditure and it is something more than the £550,000,000 and the gap something less than £475,000,000, there is still a formidable amount—hundreds of millions—still to be accounted for.

The Chancellor of the Exchequer has maintained a masterly silence hitherto to the charge that a great part of that amount, if not all of it, went in paying off old debts which were not payable under the convertibility arrangement. Before convertibility started it was his business and the business of the Bank of England to see that this amount was not frittered away in the payment of old debts, which had nothing to do with current balances and ought never to have been paid in that way. We still wait for information about that. The only light that has been thrown on it has come from the Governor of the Bank of England. He, loyally if somewhat nebulously, rallied to the defence of his patron, the Chancellor of the Exchequer, and said that none of these hundreds of millions had gone down the drain. Well, it all depends on how you define "drain." I do not think that I used the expression "drain" and I do not desire to use it now if the Governor does not like it. But what I do ask the Chancellor of the Exchequer and the Governor of the Bank of England is, what is the amount of the gap which is unaccounted for, whether £475,000,000 or something less. Let us leave aside the word "drain" and say: "Down what conduit or channel, if you prefer those words has that money gone?" That is a perfectly simple question. It is our money, or at least money which we borrowed from the United States and Canada, and Parliament, surely, is entitled to have an answer.

Let me make a suggestion as to where that money should have gone. It certainly should not have gone to pay old debts to people whom we saved in the war—if it has so gone. It should not have gone in long-range capital expenditure—if part of it did—which could bring no benefit for years Where it should have gone was in filling the pipe-lines of raw material or semi-manufactured supplies. I make no apology for raising this issue and making that charge now, because it may be in the recollection of your Lordships that a year ago or more, in one of our economic debates in this House, I said that I was much more anxious about the shortage of raw materials which would come upon us than I was about a shortage of manpower. I am quite certain that a shortage of manpower can largely be met if we all work a little harder. But whereas we can all do a little more, we cannot make more raw material out of a certain amount of raw material. Apparently, we do not do too badly in this House, as the Lord Chancellor has said. Any man can work harder to get more production, but a ton of steel, a ton of coal or a ton of any other raw material remains a ton of raw material and you cannot increase it by any modern miracle.

Was I not right when I said that the danger was a shortage of raw material? Have we not seen—and every manufacturer and trader knows of this—stocks running down? And what does that mean? It means that any bottleneck, any unofficial strike which comes about—and they will come about, I know, whatever system you have, in spite of the admirable efforts which the trade union leaders are making to-day to keep on an even industrial keel—will result in a holdup. When ordinary stocks are held, when the pipelines are filled, when the flow is going on normally, it does not matter very much because you can take it in your stride; but the position being what it is, any occurrence of the sort I have mentioned creates a hold-up all along the line. It means that we cannot employ in full clear run the labour that is available. It means frustration both of management and of workers. And it means another thing. It means that this increasing shortage of materials lands us always in more and more controls, with the result that production becomes increasingly difficult and the pipelines are adversely affected twice over, once by the lack of material and a second time by the presence of excessive control.

I want to ask what steps the Government are now taking to fill these pipelines. If I may respectfully say so to the Lord Chancellor—I hope I am not misinterpreting what he said for I listened with great attention to his speech—he seemed to me to speak (and this is where he seemed to me so pessimistic) as if the only solution was to increase the rationing of less and less commodities. That really is not the road to recovery. The road to recovery and the way to production and less control is by more supplies. That leads me to this. In another passage of the gracious Speech there occur these words: My Government will take measures to bring into essential work those who are making no contribution to the national wellbeing. I do not dissent from that. But is this to be applied all round? No one has a good word to say for spivs. They have neither useful activities nor good intentions. But what about the unnecessary hordes of temporary civil servants? Do not let anyone imagine for a moment that I am likening them to spivs. I am not doing so in the least. It is not their fault; it is the Government's fault that they are where they are. Et ego in Arcadia vixi. I began in public life some thirty years or more ago, when invalided out of the Army, by becoming temporary head of a Government Department. I have served with civil servants and as a Minister for thirty years, and I have the highest regard for them. Our Civil Service is second to none in the world. But the people of whom I am speaking have a peculiar function to perform, and they are not trained for the kind of thing which you are telling them to do to-day. Bear in mind that you do not get the best, you get the remnants and the people who are not trained to take responsibility. I dare say they are doing their best, and, as I have said, I do not blame them; I blame the Government. The Government are the people who are responsible for this excess.

Thousands of these people could be released and with their release you would also release their counterparts in industry and trade who have to answer the forms which they send out. It is a two-way traffic, this business of sending out and answering forms. It would be wasteful enough if these gentlemen sat on their seats in their Government offices and merely sent out paper, but, under frightful penalties, all that paper has to be filled in by people who ought to be scouring the markets of the world to-day in order to get export business. For every one of these people in the Civil Service, of whom I have spoken, you cause the retention of another person in some office in business. In the old Parliamentary jargon, "It counts two on a Division." The release of the man in the Government office will mean that two people will then be able to make, in the words of the gracious Speech a "contribution to the national wellbeing." And you can do that by simplifying controls.

The Lord Chancellor, if I may respectfully say so to him, put a very unfair construction on what my noble Leader said yesterday. The Lord Chancellor said in effect: "You want to get rid of all controls." That is not our idea at all. Of course you have to keep some controls, while materials are in short supply. All we criticize is the way you administer the controls, the way you try to command every platoon and ask for eighty and eight forms to go in for a single transaction. What you ought to do is to exercise the functions of a great General Staff. I think you have about three General Staffs in various Departments of the Government. Let them exercise the function of a General Staff and issue general directives. The gracious Speech spoke of the combined work of partners—I will not say both sides of industry—and that is an effective way, a much more economical and a smoother way, of carrying out the control of raw materials.

The Government are to cut down businesses. Much of the Fleet is reduced to a care and maintenance basis. The only untouchable sanctuary appears to be the swollen staffs of Government Departments. I beg the Government and the new economic commander-in-chief—Sir Stafford Cripps, a most sincere man—to reconsider this. Somebody described Sir Stafford Cripps to me in the train the other day, somebody who had an admiration for him, as the most broad-minded narrow-minded man he had ever met. I think that is true, and I hope that he is getting even more broad-minded.

I want to turn to the question of Empire economic co-operation. What the noble Lord, Lord Dukeston, said, in moving the Address, about good will and the potentialities of trade which he had found in the Commonwealth raised a welcome in my heart. But if he will forgive my saying so, he had not discovered a new continent, although he may have been visiting it himself for the first time. This goes back a long way. I recollect that almost the first thing that Mr. Bonar Law did when he became Prime Minister in 1922, was to summon, in agreement with the countries of the Commonwealth, the first Imperial Economic Conference. He paid me the great compliment of detailing me to preside over it. Then, some nine years later, came the Ottawa agreements which did so much to rescue from the slump not only the Commonwealth trade but the whole trade of the world. I am not asking at this moment for details but I am asking, and this House and the country want to know, where do the Government stand on all this? What is their policy? Do they believe in Imperial Preference or do they not? For my part, I am convinced by the practical experience of twenty years that Imperial Preference is an essential element in Commonwealth trade co-operation and in the development of the economic resources of the Colonial Empire. That experience over twenty years has proved that Imperial Preference not only increases the trade of all parts of the Commonwealth with one another, but by increasing the internal prosperity of the Commonwealth enables the Commonwealth to increase mutual trade with the rest of the world.

I cannot emphasize this too strongly. This is not a choice of Commonwealth trade or world trade. This is not a choice of Commonwealth co-operation or cooperation with Europe. On the contrary, if, and I believe only if, we increase our mutual trade within the Commonwealth, shall we be able to play our full part in economic co-operation with Europe and the rest of the world. I ask the Government definitely, do they or do they not accept that principle? Eighteen months ago, on March 6 last year, the Government accepted and endorsed a Resolution moved by my noble friend Lord Altrincham, in favour of Commonwealth economic co-operation. Do they still stand by that policy? It was made clear at the time the American Loan went through that it involved no commitments and left us free. I do not want to quote the assurances. I put three definite questions to the noble Lord, Lord Pakenham, at the time. To all of them he gave quite definite assurances: that we were absolutely free to make our own bargains, and were in no way bound or committed, that it was a matter of getting agreement with all nations, and that it was we and the Dominions and the Colonial Empire, for which we are trustees, who must make any bargain and who must agree on anything which may reduce the existing preferences.

The noble and learned Viscount, the Lord Chancellor, said that no commitments which ran counter to those assurances had been made. I am not accusing him of bad faith, but I think it reasonable to say that in these great questions of Imperial co-operation we ought not to be faced in either House of Parliament with a fait accompli. Before we are committed, we ought to have these proposals presented to us in Parliament. We are not going to take tiresome partisan lines about this. We are all trying after the same thing, but this is where Parlia- ment is needed as a Council of State, and the Empire looking to us want to see Parliament acting as a Council of State. We ought not to be presented with a fait accompli. We ought to be the judges, not only of whether pledges are kept in the letter, but whether these are wise bargains, not only for the immediate present, but for the long and lasting future.

Before I pass from the Imperial field, may I say a word about Ceylon? I welcome the passage in the gracious Speech which indicates that Ceylon, loyal, helpful to us throughout the war, seeking to develop its destiny within the Commonwealth, will attain its status as a partner. I hope the Bill will come soon. That is one which the Government may press on; they will have all our help on that. If I may strike a personal note, I would like to convey my good wishes to the respected Prime Minister, Mr. Senanayake, by whose wise counsel I benefited many years ago when I was Secretary of State for the Colonies and whose friendship I still enjoy. It is agreeable to think that he and another old friend, Lord Soulbury, were largely responsible as the joint architects for Ceylon's Dominion status.

I turn to the most controversial, the most unfortunate and the shortest passage in the gracious Speech. I do not think the Government can feel much satisfaction at the reception of their proposal to amend the Parliament Act. It has been received by the great majority of people—I think I put the thing fairly—with shocked surprise—shocked surprise at this irresponsible tossing of this apple of discord into the political arena. That shock and surprise has not been noticeably relieved by the Lord Chancellor's speech. He lamented, as we all do, the absence of the noble Viscount the Leader of the House. He paid to Lord Addison a tribute in which every one of us, wherever we sit, would wish to join, on public or on personal grounds. Though the Lord Chancellor made that generous and deserved reference to the noble Viscount, Lord Addison, he did not answer the question which the Leader of the Opposition put. Viscount Addison has been nobly doing his duty in the Dominions. If, in asking the question again, I may apply the language so often used about communication with the Dominions, whether "the Dominions have been consulted or informed" may I ask the noble Earl who is to reply whether the noble Viscount the Leader of the House was consulted, or whether he was informed, or whether the decision was taken too late to do either?

The noble and learned Viscount, the Lord Chancellor, is the ablest advocate the Government have. Therefore, we must assume that what he said yesterday was the best defence that could be put up for this strange proposal. I never heard him make a worse speech. Perhaps, as my noble friend has said, he never had a worse case to defend. In so far as he made any case at all, it was a case for the reform of the composition of this House and not for the limitation of its powers. He spoke of the possibility of the backwoodsmen suddenly emerging from the back woods. If that argument has any value at all, other than a bogey value, surely it is an argument for the reform of the composition of the House of Lords and has nothing whatever to do with its powers. The Lord Chancellor rejected that. He said: "Here you are, a perfectly admirable body, doing your work in a most admirable mariner." That is what he and his colleagues have been saying for the past two years.

In the early days they may perhaps have been a little surprised (I do not think they need have been) at the wise leadership of the noble Marquess, Lord Salisbury, or surprised at the loyalty with which he was followed. He was followed loyally because those whom he leads shared his opinions, and would not have accepted leadership in any other direction. We were led where we desired to go, as a united team, thinking the same and trying to do our duty. The Government have long since ceased to be surprised. Your Lordships will remember that the noble and learned Viscount, the Lord Chancellor, cited the case of the Coal Act. He said how difficult it would have been if the Coal Act had been held up. But it was not held up. If that argument has any validity, it is not an argument for introducing a Bill now. It might have been an argument for introducing a Bill at the beginning of the first Session of this Parliament.

As for the flimsy claim to a mandate, I do not think that that was made seriously by him. The best case he can make is this. He says, in effect, that we have a very reasonable Government (let us accept that, for the sake of argument) and a Second Chamber which behaves in the most model manner. But then he says we must look ahead for thirty-six years. That, indeed, is facing the future! If that is the claim, observe what it means—permanent legislation. This is not a case of temporary emergency powers. Let me put to the noble and learned Viscount the application of his own argument. Be it that this Government are as reasonable as he himself and his colleagues in both Houses have said this House is. If that is true, then why take any action at this time? He says that we must legislate for thirty-six years. In thirty-six years shall we always have such a reasonable Government? Can he so guarantee?

LORD CALVERLEY

Yes, if you return us.

VISCOUNT SWINTON

Suppose we had a. Government not so reasonable, which was determined to carry legislation for which it had no mandate whatsoever, to which the majority of the country was bitterly opposed. That, after all, as we all know—and I do not think there is any difference between us on this—is the regular Communist technique. It is the technique of all minority dictatorships which, by hook or by crook, seize power. One of the first things they do is to try to sweep away both Chambers; and they certainly wish to sweep away any revising Chamber. If we had a Government like that, determined to carry legislation to which the country was bitterly opposed, they might be well content, rather than face the country, to wait a single year and get this bitterly opposed legislation through. In such circumstances, the safeguard of democracy is imperilled, and might well be destroyed. It would be wicked to pass legislation of this kind to meet a temporary internal difficulty in a Party at such risk to the best interests of the country.

Earlier in his speech the Lord Chancellor appealed to us to refrain from speech or action which, designed for home consumption, might prejudice us abroad. Does he think that this particular proposal is going to help us greatly abroad? This discordant project is equally unsuited for home consumption, and can do nothing but harm all round. Since it was bruited or announced speakers and writers—not a few of them friendly to the Government—have contrasted this with the Prime Minister's appeal for union. The noble Marquess did it in an effective way in his speech. I am sure that many members of the Government disliked this proposal, and I suspect that even more dislike it now that they have seen its reception and its implications. Both Houses of Parliament always respect a man, and not the least a leader, who has the courage to admit when he has made a mistake and to retrace his steps. If the Prime Minister sincerely desires national unity—and I believe he does—this is the test. Let him have the courage to discard this ill-advised project, give to the country a real lead, and in his own words a year ago, put first things first.

4.22 p.m.

LORD LUCAS OF CHILWORTH

My Lords, I shall not find any great difficulty in receiving the indulgence of the House if I say that I do not think I could do better than follow the very splendid example set by my noble colleagues who proposed and seconded this Motion, in paying due regard to that well known slogan "It is better to be safe than sorry," and to steer clear of the more controversial matters in the gracious Speech. In point of fact, at this hour I do not think I should be over-stating it when I say that I would receive the approbation of a number of noble Lords if I here and now gave a solemn undertaking not to mention the Parliament Act, 1911.

I intend to address a few observations upon what I consider are practical things of far more immediate importance. If I may, I would ask your Lordships to give attention to the third paragraph in the gracious Speech, where it says the first aim of His Majesty's Ministers will be to redress the balance of repayments, and that this will demand increased production and the sale abroad of a greater share of goods produced in this country. I think that supporters and critics alike are quite willing to pay a generous tribute to the Minister of Economic Affairs for the very realistic plan which he has put before this country to increase our production. I wish I could have as much satisfaction over the efforts which are being made to sell that production when it has been produced. Production is one thing, but to sell that production in the mar- kets of the world, in the fiercely competitive conditions of the next five years, is going to be another. I would suggest that we want to address as much thought and as much planning to finding markets when we have to face the fierce competition of some of our more fortunately placed competitors.

I must confess that I was very impressed with one passage in the speech of my noble friend Lord Dukeston, upon which—I hope he will not think it impertinent of me—I would like to congratulate him. The noble Lord drew attention to his apprehension over the capital equipment produced in this country being exported abroad. The noble Lord's words were: … and we may under the great pressure now placed upon us to accomplish that objective so affect our capital plant and equipment that when we do emerge we shall find ourselves in a competitive world where we are very seriously handicapped in the fight to maintain our status as a great industrial nation. One of the reasons we are in the position we are in to-day is that we neglected to re-equip industry during the inter-war years. One of the reasons why we are faced with high cost of production to-day, to our great disadvantage abroad, is the ill-equipment of our great industries. I would beg of you to appreciate that increased production relies on many things other than the expenditure of human sweat and elbow grease. The more manpower you have to use in industry to-day the higher your costs. Our future as a great industrial nation is going to depend not only upon the quality of our products, but upon our competitive position as regards price. I must confess that I am alarmed at the increasing costs of British production to-day. It is a matter to which industry has to give very serious attention, or else we shall find our warehouses and factories full of goods and the markets of the world closed to us because we are not competitive.

The next point in the gracious Speech to which I would like to refer is the one which my noble friend Lord Dukeston passed over so nicely because, I suppose, he wanted to keep his bargain not to be controversial. After the Heyworth Report I do not think it could be claimed that the nationalization of the gas industry comes within the category of the controversial subjects to-day, but the part of the gracious Speech which deals with that says that the event is in completion of the plan for the co-ordination of the fuel and power industries.

When the noble Lord, Lord Strabolgi, addressed your Lordships early this afternoon I had No 1dea that he was going to raise the question of the disbandment of the Petroleum Board. At a time such as this, when the whole of the country's man-power has to be mobilized, when every activity has to be diverted into productive sources, to disband the Petroleum Board and reinstitute the competitive activities of petrol companies, competing and selling individual brands of petrol when they cannot increase the sale of petrol in this country by one gallon; selling a commodity which is strictly rationed and in shorter supply now than it was, puzzles me; I do not understand it. Are we to be treated to the spectacle of having multi-coloured petrol pumps all over the country? Are we to be treated to the spectacle of various brands competing, with the corresponding waste of man-power and distribution transport, all the way along the line? I feel the noble Earl who is to reply on behalf of His Majesty's Government must have a good reason why this action has been taken, but if there is I confess that it has not emerged in any official statement that I have seen. I understand that this is to operate from January I onwards. I beg the noble Earl to say why this is proposed, because at a time such as this, when men are being directed and industry is being directed, to have a reversal of policy in the special case of petroleum companies is something of which some sections of the British people will want an explanation.

That brings me to a very controversial subject, and one upon which I may lay myself open to a charge of special pleading. But I ask your Lordships at least to pay me the compliment of believing that I am actuated only by a desire to increase the industrial efficiency of this country. I cannot escape the feeling that the abolition of the basic petrol ration is a mistake, which may in the last analysis lose us more in industrial efficiency than any corresponding gain there may be in the saving of dollars. I believe it is insufficiently realized what a great and integral part is played in the life of this country by the individual unit of transport. We have in this country a problem which no other country has, a short, relatively intricate network of journeys between factories and works, where the door-to-door conveyance is an absolute necessity. I am alarmed about transport prospects during this coming winter. Any noble Lord who has studied transport problems has a right to be alarmed, especially with a knowledge of what happened last winter, when (from an entirely different cause) the transport of this country was disrupted.

The transport of the country will have an even greater strain put upon it during this coming winter. It has been authoritatively stated that the number of railway locomotives under repair to-day is one-fifth of the total. Track maintenance is badly behind requirements. It was authoritatively stated the other day that the Coal Board have to contemplate the shifting of 2,500,000 tons of coal by road during the next six months because the railways cannot handle that traffic. Take the position of public road transport. In the words of the Chief Mechanical Engineer of the London Passenger Transport Board, as reported in The Times of Saturday last, after setting out the miracles that have had to be performed to keep London buses on the roads, he said: In spite of these efforts however, 400 of London's 5,000 buses had been off the road recently in a single day, and at one time 140,000 bus-miles a week had been lost. Buses, trams and trolley buses were now running 23,000 more miles of services daily than they did before the war. The number of road passengers had increased by 1,000,000 a day, to 10,160,000 since 1939. What is true of London is true of every city and town in Britain. What is going to happen when a great increase is thrust upon a transport system already overstrained? In the six winter months, every mile that is travelled by a privately owned motor car can be said to be run on essential or semi-essential work—people do not run cars for pleasure during an English winter. I am apprehensive that we shall lose productive man-hours through the workers in industry standing in queues, seeing buses go by full; and if you total up an hour lost by every workman every day, both going and coming, it adds up to a considerable total.

I would beg that this matter be reconsidered. I would be the last to claim that there are no good grounds for cutting petrol supplies. I am prepared to accept that.

What I do suggest most seriously to the noble Earl is that that cut should be distributed fairly and equally over every form of petrol user. I make no charge, but the industrial and the commercial user of petrol in the past has not been the most careful in his use of petrol. I am certain that if the petrol given to commercial and industrial users in this country were cut by the requisite amount it would not reduce their efficiency by one per cent. because it would give greater scope for better management in the use of fuel. I ask the noble Earl at least to agree in his reply that a prima facie case has been made out for reconsideration.

I have not touched upon other aspects, the amenity aspects, the housewife's point of view, and so on. Yet there was a passage in the speech of my noble friend, Lord Dukeston, which I would again commend to the attention, not only to your Lordships but of His Majesty's Government. He said: My fear is lest we should get into a descending spiral and should apply economies in a way that would tend to destroy the will to greater effort in the field of production. There is, I think, a doubtful psychology in cutting something which has been proved to be such an integral part of the industrial life and the social structure of this country.

I was heartened when I heard the noble Viscount, Lord Swinton, say this afternoon that he was not pessimistic about the workman and the common man of this country. I have a feeling that the two sides of industry, employer and worker, are losing confidence in each other. Once we do that, we lose confidence in ourselves. I would beg noble Lords not to join in the parrot cry that "Labour will not work." If labour will not work, it is the responsibility of management, and management has got to find the answer to it. The day we lose confidence in ourselves our democracy is adrift on a perilous sea, and a sea with a considerable number of pirates about. I would beg employers and workmen in industry to try by every method possible to pull together. If we do that we shall eventually find the solution to our present difficulties and troubles.

4.40 p.m.

THE EARL OF IDDESLEIGH

My Lords, like the preceding speaker, I am proposing to avoid touching upon the con- stitutional issues except perhaps to say this, that His Majesty's Government may have found that the ermine-trimmed robe of the Peer is a very useful red rag waved in the eyes of John Bull in order to divert his attention from other aspects of the Government's programme which are likely to be of much more immediate effect, and perhaps of even greater ultimate effect, upon the lives of His Majesty's subjects.

I beg your Lordships to read and read again the fifth paragraph of the gracious Speech, in which the subject of the conscription of labour is introduced. It seems to me that that fifth paragraph marks a very important stage upon the road which Mr. Hilaire Belloc prophesied thirty years ago that we should follow—the road to the servile State. Day by day we see less of the warm and generous Socialism of the platform and more of the cold and calculating Socialism of the study. The penal and restrictive side of Socialism is becoming daily more obvious to the country. There are many aspects of this paragraph on which I might dwell, but, in view of the lateness of the hour and the number of speakers upon the paper, I will confine myself to saying that, so far as this paragraph is concerned, there is No 1ndication that these controls are temporary in character or that they are imposed with any sort of reluctance. I hope that the noble Earl who is to reply to this debate will be able to give us some enlightenment upon this question.

During the war, we deliberately sacrificed freedom for the duration in order to preserve it for the long future. How long and until what time are the restrictions and controls and directions upon labour to be imposed? Is it until we have safeguarded this nation from the actual danger of starvation, or is it until we have secured the continuance of the present standard of life, or are they to be imposed in the general interests of improving the standard of life of the country? I would mention, if I may, a very striking passage in the speech of the noble Lord, Lord Dukeston, in moving the humble Address. The noble Lord pointed out—and no one is more competent than he to do so—that any substantial transfer of labour from secondary to primary industries must necessarily involve a transfer from one part of the country to another. That consideration which has now been publicly mentioned must necessarily excite a good deal of alarm in many sections of the public, and I conceive that the noble Earl will be doing a very considerable national service if he is able to deal with that matter at an early date. I quite appreciate that he will not be able to make a statement on so large an aspect of Government policy immediately, but I hope that he will press his colleagues for a very early statement on the matter of the transfer of labour.

I do not know, of course, what steps His Majesty's Government intend to take in this matter. I think that I may say this. Before the war, my Party was faced with the immense problem of unemployment, and one of the factors that made the unemployment problem so very hard to solve was the difficulty of persuading—we adopted only methods of persuasion—labour to move over, to persuade labour to move from the stagnant pools of unemployment in the Rhondda Valley and elsewhere to other areas where work could be found for them. I know what very great weight my leaders attach to that factor in the problem. Are His Majesty's Government going to cut the Gordian knot which we tried to untie and, if so, how are they going to persuade the British public to accept the status of displaced persons? In his speech of yesterday afternoon, the noble and learned Viscount who sits upon the Woolsack addressed this plea to the House. He said: "Do not let us put it all down to the incompetence of a wicked Government." I could wish that the Labour Party would have that consideration in mind in their criticisms of the actions of the Conservative Government before the war in the matter of the unemployment situation. If we extend that understanding to them—and I am sure that we are very willing to do it—I hope that they will persuade their propagandists, and in particular, the author of their latest publication The A.B.C. of the Crisis, to extend a similar degree of courteous tolerance to us.

The steps which His Majesty's Government propose to take in the matter of the direction of labour have been commended to the public under the guise of measures largely, perhaps primarily, directed to bringing into industry the spiv, the drone, and the butterfly. So far as the spiv is concerned, I wish you good hunting, but you will need all the luck that you can possibly he wished. By definition, I understand, the spiv is a man who has for a considerable number of years succeeded in defying the law of the country, in evading all the attentions not only of the police but also of the army of Government Department snoopers, and who maintains, in spite of his vulnerable position, an uninterrupted mode of life. Will His Majesty's Government be able to tell us whether there is to be a strict national registration or not, and when we may expect this very important measure?

As regards the drones, again they may be more easily caught, and I suppose that the employers of labour will really appreciate it if a number of drones are drafted into their factories. But, as regards the butterflies, I would venture to ask the noble Earl to take an early opportunity of enlightening us upon what the Government propose to do. I take it that the term "butterfly" is applied to members of the female sex. What precisely is going to be done about the women? I have seen lately a number of posters, the theme of which is "We want the women back in the factories." It is a case of sic volo sic jubeo. I trust that very great consideration will be given to the housewife. The housewife whose picture is on the poster to which I have referred, appears to represent a married woman. I do not know whether the married woman who remains in her home and who does not fall in with the wishes of His Majesty's Government by going into a factory comes under the heading of "butterfly," but I am very anxious to see the definition clause of that particular measure, and I am very well aware that among the women of this country there is a considerable degree of apprehension in the matter.

I believe that this country is truly impressed by the gravity of the crisis, and that it will not shrink from accepting even the most drastic measures that are proved and demonstrated to be really necessary for the solution of immediate problems, provided always that the people are not asked to make any permanent surrender of their rights, and provided that they are told at the earliest possible date exactly what is to be demanded of them. That has not yet been made clear, and I can only beg His Majesty's Government to make it as clear as possible at the earliest moment.

4.53 p.m.

LORD DE L'ISLE AND DUDLEY

My Lords, there have been a good many remarks lately, both inside and outside this House, about the necessity for our unity of purpose. I myself have no quarrel with the motives of those persons, many of them eminent, who have offered that advice. I can only state my own conviction, that we shall not achieve unity of purpose in our present difficulties if we are treated, as we have been treated, to a series of sermons and exhortations, to a number of targets—some of them disappearing targets—to further controls and, sometimes, to further threats. I listened with deep attention to the gracious Speech, and I have read it again, but I believe that much of it—perhaps the majority of it—is irrelevant to our present position. I shall await the Budget proposals of the Chancellor of the Exchequer, because it is then that we shall know whether or not this Government are in earnest. The noble Lord, Lord Dukeston, in moving the Address yesterday, spoke about the necessity of giving industry freedom to implement the plans laid down by the Government. It is becoming increasingly clear that the most efficient way in which a Government can implement their plans is through proper finance, and that there is no way of meeting it by exhortation, prohibition, control or threat.

I am not going to deal with the question of the Constitution. I state only my own opinion, that there can be no shred of doubt that for this measure the Government have no mandate at all. They have a mandate, and an implicit mandate, at all times—and all Governments have it—for two things. That is;, a mandate to preserve the independence of our country, and a mandate to strengthen the bonds of our Empire and our Commonwealth of Nations. But it is chiefly by their conduct of the external affairs of this country that history will judge this Government. They took office when our reputation was high in the world. How will they leave it? How are they dealing with the problem now? We have had many speeches on the great measures of social security which have been offered to the country during the tenure of office of the present Government. One might almost think, when one hears the Chancellor of the Exchequer speak, that he was the sole author of these schemes. But, whoever conceived them, whoever put them into practice, there is no possibility that we can maintain them unless we look first to our national security. It is because I am so deeply disturbed about the status of our country in the world to-day that I venture to draw your Lordships' attention to that passage in the gracious Speech which touches upon this problem.

I listened last night—a thing I do not do very often—to a talk on the wireless called One world and two blocs. I must say that as I listened my depression grew, because the speaker seemed to regard it as inevitable that there were two, and only two, blocs in the world. It seemed to me a remarkable feat that anybody who regarded himself as a competent observer of Parliamentary affairs should be able to make a speech of some twelve or fifteen minutes without ever mentioning the British Empire. I believe that there is a Spanish saying that if you have two bulls in the ring there will be a fight, but that if you have three there will not. I am as certain as I stand here that if it were really true that there were only two great Powers in the world facing each other, sooner or later, and rather sooner than later, there would be a third world conflict. It is because there is, or there should be, a third great Power in the world that I wish to draw the attention of His Majesty's Government to this particular part of the gracious Speech.

The gracious Speech refers to the part that the Government will play in the work of European reconstruction, and the talks in Paris. It says: The present obstacles to co-operation and understanding between the peoples of the world, have strengthened the determination of my Government to support the United Nations, and to seek by that means to promote the mutual trust and tolerance on which peaceful progress depends. I do not in the least accuse His Majesty's Government of not being aware of the importance of the Commonwealth in the world to-day, but I do regret that more prominence has not been given to it in the gracious Speech. It is not a choice of following Russia or following the United States. Such a choice is not a foreign policy. If there had to be a verdict in this country, I have no doubt that we should decide to cast in our lot with the free forces of the world. But friendship, or the cultivation of friendship, with the United States is not a policy. Hatred of totalitarian Governments, in whatever form they may arise, is not a policy. The policy of His Majesty's Government must be to strengthen in every possible way that great community of free and independent nations over which the Crown rules in the seven seas of the world.

I said at the beginning of my speech that I thought that a great part of what is contained in the gracious Speech is irrelevant. I think it irrelevant because I do not consider that it shows a grasp of the present situation in which this country finds itself. The noble Viscount, Lord Swinton, in his speech said, as I thought very justly, that it was no solution of our problems to keep on devising new ways of dividing a smaller and smaller and smaller portion of the national production among our people. It is not deprivations and a lower standard of living which are causing the present despondency and alarm among the people of this country. The reason for this despondency and alarm is that they lack hope and inspiration. They have shown that they do not fear hardship or deprivation. But if we could feel that we were enduring our present troubles and discontents because we had some practical future to look forward to, then I think that a great many of the controversies and much of the bitterness now being generated would disappear.

We want a goal—not a goal for any single class or Party in our State, but one to which we can all look forward. We want a policy of true expansion. Surely we are not merely a nation of some 47,000,000 people shut up in a crowded island? We are at once a European and a world power and, what is more, an Imperial power. Surely it is in the development of our Empire and in the strengthening of the economic ties which bind us to the Dominions that our future lies. Let us not deceive ourselves into thinking that this will be easy. Let us not deceive ourselves by supposing that if we are to develop our Empire it will not be at the expense of our own consumption. But how much better to deprive ourselves for such an object than go into a descending spiral, such as we apparently are confronted with at the moment, for no object at all.

I do not intend to talk about Imperial Preference as such, though I gravely fear that it may be weakened by what is afoot now. But I do say that there is a choice before this country, a choice which may be a fleeting one. If we show the right spirit of enterprise and courage and an imaginative grasp of affairs now, we may be able to revive our nation in a way that will astonish the world. After all, the people of America expanded across that great Continent in a way that still astonishes our contemporaries. An immense development took place in the '6o's, '7o's and '8o's of the last century. Is it too much to hope that we, in this country, with our great estate cannot develop it to a commensurate degree? Let us no longer bicker about the past. Let us put aside old sectional quarrels. Let us see if we cannot, at the cost of sacrifice if need be, at the cost of further hardship if it must be, go forward to make a third world Power a reality. In so doing we shall not be pursuing a policy of conquest, a policy of selfishness. We know that the British Commonwealth of Nations can be the model upon which a greater unity can be established in the world. Let us see that this opportunity is not lost both to ourselves and to our children, and that we secure at once the prosperity of these Islands, of the Dominions and of all the great territories under the British Crown, and, at the same time, promote the greater probability of peace in our time.

5.7 p.m.

THE EARL OF PERTH

My Lords, I would like, for a few moments, to pass from the domestic issues which have elicited so many brilliant and even exciting speeches, and devote a little time to the international scene. I make no apologies for doing so because I believe that if we can make real progress towards the establishment of a peaceful world, then our economic recovery becomes much easier than if we have a world which is troubled and in a state of confusion. There are a few short references in the gracious Speech to foreign affairs. I note that in one such reference the gracious Speech expresses the hope that the forthcoming Conference of Foreign Ministers will result in a measure of agreement which will lead to the satisfactory settlement of the international status of Austria. I fear that those words, as they stand, may create a feeling of despondency among the people of Austria who are to-day doing their utmost to make a democratic and economic recovery in very difficult circumstances. I would like to remind your Lordships that the international status of Austria was definitely settled at the Moscow Conference in the late Autumn of 1942, and that the three Powers concerned then stated that they wished to see re-established "a free and independent Austria." In debates about Austria which we have had in this House, your Lordships received from the mouth of the noble Lord, Lord Pakenham, an assurance that the territorial integrity of Austria would not be diminished. I realize, of course, that he could speak only for His Majesty's Government. But I do very earnestly hope that the noble Earl who is going to reply to this debate will be able to say something reassuring on this point which I know is otherwise likely to cause considerable distress.

The gracious Speech also promises that the Government will fully support the United Nations and seek, by that means, to promote the mutual trust and toleration on which peaceful progress depends. I believe that to be an absolutely right policy. Let us remember that the nations of the British Commonwealth are among the warmest and most ardent supporters of the United Nations. All of us no doubt have felt sad and dissatisfied at some of the proceedings of the Security Council, and particularly the refusal of the Soviet representatives to co-operate except on their own terms, and the continuous use—I should say abuse—of the veto. But in spite of all these dissensions, the Assembly of the United Nations which is now sitting is producing real and definite results. And why? Because there is no veto. The results are much more satisfactory than many of us know.

It is in the Security Council that the trouble lies. I agree with the noble Marquess, the Leader of the Opposition, that the veto is bad in itself. He has never liked it and I have never liked it, but he defended it because he said that without it we should never have had a comprehensive organization. I think he is right. I agree the price was high, but the stakes are enormous. In spite of what the noble Marquess said yesterday, I feel that to endeavour to amend the Charter so as to do away with the veto would completely break this young world organization in which we all have so much hope. What we should endeavour to do is to secure that the veto is not abused as it is abused at the present time. There is a proposal now before the Assembly to set up a Committee to study this problem and I sincerely hope that the representatives of the Government at the Assembly will give that proposal their fullest support.

We must remember that as a last resort the use of the veto can be made of no avail if the majority of the United Nations feel strongly on any particular point and are prepared to act. That majority could—and would, of course, only do so in exceptional circumstances—join together to carry out their joint desire outside the scope of the United Nations. Still, it is a possibility, and it was that possibility which very largely avoided any use of the veto in highly important matters in the days of the League of Nations. I speak with certain experience.

In this connexion I would like to call your Lordships' attention to Article 51 of the Charter of United Nations. I will read only the first sentence: Nothing in the present Charter shall impair the inherent right of individual or collective self-defence if an armed attack occurs against a Member of the United Nations, until the Security Council has taken the measures necessary to maintain international peace and security. I hold that in that Article lies defence against aggression. There is no veto in it because defensive action can be taken before the Security Council acts. It seems to me that the right of collective self-defence, as laid down in the Charter, is continuous and can go on until the Security Council takes measures for ensuring peace. That means that the veto cannot be used in that connexion. I believe, therefore, that the passage in the gracious Speech to which I have referred is fully justified, and I do not share the view which I think the noble Marquess took—I do not want to misrepresent him—that we should cut out what he called the "cancer" of the veto, otherwise the disease might kill the whole organization.

THE MARQUESS OF SALISBURY

I hope I did not say that we ought to do it now. I said, "Let us beware less this veto … should grow into a disease that will kill the whole organization." I did not ask for immediate action. I am in entire agreement with what the noble Earl has said up to now, but I think it is something we must keep in mind. If it did become a fatal weakness in the new organization, we ought to face the necessity of cutting it out.

THE EARL OF PERTH

I accept fully what the noble Marquess has said and agree with him that there might come a time when we have to face it, but at present I do not believe the disease, which I agree exists, is nearly so dangerous as the operation would be. The operation is much more likely to kill the patient than the disease in this particular case. I referred to what the noble Marquess said because it seemed to me that he was a little unkind to the Government as regards their performance in the field of foreign affairs. Of course it is true that there has been a deterioration, and we all deplore it, but I do not hold that the name of Britain abroad has fallen to a low ebb. I do not share that view at all. Nor do I believe that the deterioration in international affairs has been due to the policy pursued by the present Foreign Secretary. I have no doubt he occasionally, like other people, commits an indiscretion or two, but it is on very exceptional occasions. Perhaps he allows his tongue too much freedom at times, but I hope the noble Marquess will agree with me that his policy has been sound and wise.

THE MARQUESS OF SALISBURY

I think I made no attack on the Foreign Secretary at any moment in my speech. But things have been promised and have not been realized. That, I think, is true.

THE EARL OF PERTH

Perhaps it is unwise to make promises. I agree that the realization has not taken place. The noble Marquess also spoke of the Government having antagonized both Arabs and Jews in the Middle East. I do not know if he had in mind Palestine, where passions on both sides run now so high that anybody who tries to be impartial or just is bound to be attacked and abused by the extremists of both Parties. I think we are right in referring the whole problem of Palestine to the United Nations and I trust that that organization will not only come to a definite decision in principle as to what shall happen but also—and this is most important—will arrange the implementation of any decision that may be reached. I think it is clear that we must withdraw our forces from Palestine without any undue delay. But again I earnestly trust that arrangements will be made with the other interested nations in the United Nations for that withdrawal to be orderly, and that we shall never see chaos reign throughout the Holy Land.

I do not think we can put any blame on the Government for the state of our relations with Russia. The Foreign Secretary has certainly done his best to make our Treaty of Alliance with Russia effective. To make a treaty work requires good will on both sides, and we have received nothing but bad will on the part of Russia. It is a curious fact that the Russian Press and the Russian statesmen are far more vituperative of the existing Government than they were of one which was headed by Conservatives. That is a sad and rather remarkable fact. We must remember that the Alliance, which we all welcomed, and the decisions of the Moscow and Yalta conferences—which, if I remember rightly, the noble Marquess, Lord Salisbury, was called upon to defend, and succeeded admirably in doing, in this House—

THE MARQUESS OF SALISBURY

And so did the noble Earl. I have a quotation from the speech of the noble Earl which I will read. I was waiting for this. What the noble Earl said was: There is no doubt that the declaration and the principles laid down at the Yalta Conference are excellent. The principles and intentions are admirable. But, to my mind, the touchstone will He in their execution. His Majesty's Government have undertaken a very grave responsibility, a very great responsibility. Many of us will judge the Yalta Conference in the light of how that responsibility is effectively fulfilled. To-day, surely, we cannot do more than fully approve of the declarations which have been made, and warmly congratulate the Government on them.

THE EARL OF PERTH

I think that shows, great prescience on my part, because the obligations have not been fulfilled, unhappily, and if the Government which concluded the Yalta Conference are to be judged by results, all I can say is that the judgment must be hostile.

THE MARQUESS OF SALISBURY

I said in that debate, if the noble Earl will refer to it, that it was dependent upon full co-operation by Russia.

THE EARL OF PERTH

After that little passage, on one thing we both seem to agree. The Soviet Government have not co-operated, either in the working of the Alliance or in the fulfilment of the Moscow and Yalta Conferences. I would say that that is certainly not the fault of His Majesty's Government, who have done their very best to make the Alliance work.

In conclusion, I would like to refer to a remark made by the noble and learned Viscount, the Lord Chancellor, yesterday. He said that it seemed to him that what was wanted in foreign affairs more than anything else was patience. Up to a point that is perfectly true, but we must combine patience with firmness. I fully agree: that we must await (although I fear we cannot do so with much optimism) the meeting of the Foreign Ministers in November. That meeting, to my mind, will be decisive, and if we cannot reach agreement then we must go ahead on cur own lines promoting a peaceful world, so far as we can, without Russian cooperation. There comes a time when patience instead of being a virtue becomes a vice; it passes into a refusal to face unpleasant and undesirable facts in the hope that something may still turn up to remedy the situation. I think that we all realize that sometimes in the past we have suffered terrible things from excessive patience. Let us not do so again.

5.25 p.m.

LORD ROCHDALE

My Lords, in the few remarks which I wish to address to your Lordships this evening I want to deal primarily with the second paragraph in the gracious Speech, where your Lordships will remember confidence is expressed that in these times of hardship the people of this country will demonstrate once again to the world their qualities of resolution and energy, and that with sustained effort this nation will continue to play its full part in leading the world back to prosperity and freedom. I do not know What that sentence means to your Lordships, but it conjures up in my mind a situation where everyone is fully alive to the difficulty of the present position, where everyone is fully conscious of his or her responsibility in the matter, and where everyone is prepared to forego whatever they may be called upon to forego in order that we may pull together, as we did during the war, and get the country out of its present difficulties. I wish I could really think that that was a true picture of the country to-day, but I find myself quite unable to do so.

I am convinced that even now a very large part of the population have no conception of how serious the situation is. They cannot, therefore, be expected to react in a particularly altruistic or patriotic way—in other words, in the way in which the situation warrants, and in the way in which His Majesty's Government are calling on everyone to act. The. fact that there are still so many shortages, so many queues, and other inconveniences, has become so much an accepted situation that a few more restrictions here and there do not strike one nearly so forcibly as they would have done a few years ago. We are like people who have been inoculated so many times that we are to some extent immune to further inconveniences. I am sure that there are a number of people who have given up wondering what is the cause behind new restrictions and problems.

The point, therefore, arises, how can we overcome what I consider is a lack of ability to discern what we are really up against? Alternatively, how can we find some substitute which will achieve the same end? It seems to me that, broadly speaking, there are two possible courses that we might adopt. The first is by an appeal to the more material instincts, by lifting somewhat the pall of austerity, and by diverting into the shops more goods which the people, and particularly the housewives, want, and so creating something really tangible which the people can see and work to acquire. The other course is to appeal more to the patriotic instincts. There I have in mind that the Government should make some gesture, so that everyone can understand and appreciate that they themselves are prepared to forego some of their Party programme, and so demonstrate that at the top, at any rate, the Government and the Opposition, while retaining absolutely their individual indentities, are working more closely together for the common good.

It may well be—and I am inclined to think so myself—that the time has passed when the first alternative would be practical politics. Therefore, one must turn to consideration of the second. As far as I can see there is nothing in the gracious Speech or in what Government speakers have said which suggests they are prepared to adopt such a course.

There is certainly more than one contentious matter in the Speech which could so easily and wisely have been omitted and others, I suggest, that could have been more fully clarified to allay suspicion. During the Recess there was more than one occasion when Government spokesmen in different parts of the country went out of their way, one might almost think, to sow discord. There is certainly one Order—I refer to the abolition of the basic petrol ration, which the noble Lord, Lord Lucas—with whose sentiments I so absolutely concur—dealt with so admirably as to which, whatever may be the calculated reason for its imposition, we cannot get away from the fact that far too widely in the country as a whole it is looked upon as being not merely unwise, but a definite and calculated piece of prejudicial class legislation. I have no doubt your Lordships have met people who have expressed themselves in that way, and I have met them over and over again. They may be mistaken, but that point of view is very widely held in the country.

The noble Lord, Lord Dukeston, in his admirable speech told us—and I believe him to be correct—that never was there a time when there was greater co-operation in industry between management and organized labour. I am sure he would not claim that that was as a result of the efforts either of this or any previous Government, but was rather due to the good sense of all concerned who should very rightly receive the congratulations of the country as a whole. But I suggest that that pleasing state of affairs must not be allowed to delude us. The fact remains, whether we like it or not, that such of the electorate as are conscious of their political responsibility are very widely divided, and that division must militate against the general efficiency of the country. Although the responsibility for the economic plight of the country can only to a limited extent be placed at the door of the Government, there are many other powerful factors of which we all know, with which any Government would have had to contend if they had been in power. The fact that the country to-day is so widely divided politically and, therefore, so much less well prepared to meet the economic blast, is a situation for which the Government alone must accept responsibility.

Earlier I suggested that some sort of gesture on the part of His Majesty's Government would help to allay that situation. There may be many gestures they could make, but I am going to make one suggestion. During the war a Committee was set up in the War Office, which I think included at least one Member of Parliament, whose function it was to tour Array establishments to see whether manpower was being used to the best advantage, and where they found that this was not the case adjustments were made accordingly. Now I would like to see the same principle employed with an independent committee to see whether all the controls that exist to-day are really fulfilling a sound function. As other noble Lords have said in the course of the debate, I am by no means suggesting the abolition of all controls. When shortages of so many important commodities still exist, some control must be retained in the interests of fair distribution and to assist vital exporting industries. But I suggest that there may be some controls which, for all the effort they involve on the part of private individuals and firms who are affected and on the part of the Civil Service who have to operate them, in point of fact achieve little or nothing, and serve only to irritate and act as friction in a machine wastefully absorbing valuable energy. I believe that if His Majesty's Government would conscientiously apply themselves in that direction with an obviously independent committee, that would do much to convince many people throughout the country who are somewhat suspicious of the Government's intention, and help to justify their appeals that we should all pull together as one team.

Many noble Lords who have spoken have studiously avoided speaking on the question of the Parliament Act, but I will ask your Lordships' indulgence if I mention one or two points. I listened with great care to all that has been said, and in particular to the skilful advocacy on the part of the noble and learned Viscount regarding the Government's proposals, but I must say that I was far from convinced. If I understand it aright, your Lordships' House, during the last two years, has indeed acted beyond reproach. Are we then to understand that now, in this very critical time, we are not to be trusted to avoid something which will harm us not only internally in the country but also in the eyes of the world—namely, a constitutional crisis? His Majesty's Government's appeal for unity on the one hand is not supported by what they are always doing on the other. If they want unity I suggest that it is up to them to give a lead in that direction.

There is just one further point I would like to mention, and it is I think a point with which individuals may disagree more than Parties. It seems to me that quite apart from what may have been said or intended in years gone by, it is quite wrong that the powers of your Lordships' House should be curtailed without a simultaneous alteration in its composition. Many noble Lords find themselves, through no effort or fault of their own, and not of their own choosing, in your Lordships' House. They conceive it to be their duty to attend regularly as far as they possibly can, sometimes at considerable disadvantage both financially and otherwise to themselves. Is it right that those individuals should be restricted in their potential activities without granting them a corresponding right—to use a phrase which has been used in other circumstances—"to opt out" and acquire the same privileges which every other citizen of age has—namely, to vote and, if they choose, stand for election to another place? I hope in referring to that I shall not be accused of putting the claims of individuals before the good of the community as a whole, but it is a point which will affect not merely this generation but many generations to come, and I believe it is a point which is not always realized. I therefore make no apology for mentioning it here.

5.40 p.m.

LORD FAIRFAX OF CAMERON

My Lords, I desire to call attention to a passage in the gracious Speech dealing with the expansion of Empire production. I would like to bring to the attention of His Majesty's Government the point that economic unity on a trade basis must be an essential part of any Empire production plan. It will entail my making some reference to Imperial Preference. However, all my references are solely concerned with the short sentence that appears in the gracious Speech and not to any reports that I may have seen in newspapers in the last few days.

At the outset one should observe that the destiny of the United States and the destiny of the United Kingdom must in- evitably lie together, and we must therefore know each other's interests and present position on all matters that may be common to the two of us. I am half American, and my father was an American, born and brought up in Maryland; and I still have relations living in America. With that in mind I am perfectly convinced that the Americans appreciate plain speaking on our part on all matters that might affect the two of us. I am therefore quite sure that it will in no way offend them. One often hears people say that we must not mention these things, that we must pull our punches. I am sure that is quite wrong.

If we should exercise plain speaking on any subject I am sure we should do so on the subject of the British Commonwealth of Nations. The strength we derive from the Commonwealth is not our own strength; it is the strength that belongs to the Commonwealth; and any policies affecting the Commonwealth must be the concern of every nation's Administration as well as of our own. We should consider them fully before we take any steps likely to throw away what we derive from this group of nations. It would pay the United States for us to be strong not only in this island but also in the whole Commonwealth; and this not only because we can thus be a worthy partner to her in the Councils of the world, but also because this island alone provides one of her greatest markets.

I personally was very glad to see the passage in the gracious Speech which dealt with the expansion of Empire production, not only on a short-term basis for our immediate salvation but also on a long-term basis for the maintenance and the very existence of our Commonwealth. However, I do deeply regret that there was no word in the Speech about the furthering of Empire economic unity—in spite of the assurances given eighteen months ago in the debate on the Loan and also by the noble and learned Viscount on the Woolsack. To my mind the sentence contained in the gracious Speech is only half the picture. Any plans that are based purely on that sentence must be incomplete. There can be no adequate production in the Commonwealth without the economic unity of the Commonwealth being maintained the whole time on a trade basis. It is history that has proved that and not idle theory.

It is true to say, looking back at that history, that the Commonwealth has been entirely built up on the system of Imperial Preference. The system of Imperial Preference, preference on each other's commodities, has given to the various units of the Commonwealth a springboard for production; and it has been in itself a thing that has made for the expansion of Empire industries because of the incentive given to Empire producers. That I am sure is worth all the development schemes this country could ever produce. Furthermore, I am certain that each one of the great nations that exist in the Commonwealth realizes that in great measure it owes its development to the growth of Imperial Preference. The effects of this system are many. In the first place it ensures markets for backward producers, producers who through the state of their country and their industries are unable to compete with more economic producers who turn out the same goods. Again, a system of Imperial Preference provides confidence for those producers in the future, above all by ensuring them a stable market in the world where they know that at any time in the future they will be able to place their goods and sell them. This enables those producers to modernize their industry and expand their output so that the day comes when the preference can be gradually taken away, because the industries no longer need it. We certainly have not reached that day yet, and when we shall I do not think anyone can prophesy.

Another very important aspect is that under this system and by this process, the standard of living of the people, particularly in the Colonies, can be raised; and without the standard of living being raised, welfare schemes are perfectly useless and dangerous to the natives. It also provides not only goods for this country but also markets for our goods, because when the producers are able to expand and sell more goods they have more money and therefore are able to buy more goods from outside their own territories. It is not a great step from that to realizing that this process of strengthening the units of the Commonwealth and making them more prosperous directly increases their foreign trade and the trade they can do with countries like America, both by providing markets for goods in America and also by enabling them to provide markets for America.

I have here one or two examples which I thought I might give your Lordships to illustrate what I have said. One in particular which I have selected is the South African wine industry. This took place in the last century. In 1813 a preference was put on South African Cape wine; in 1823, ten years later, imports of South African wine into this country had increased ten times. In 1860, when the free trade era came in, direct preferential duties were removed, and at that date, that is at the end of the preferential period, the South African Union were sending to this country 600,000 gallons of wine per annum. In 1870, ten years later—after the preferenial duties had been removed—the wine that was being brought into this country had dropped from 600,000 gallons per year to 40,000 gallons per year. In 1896 the quantity of wine being shipped to this country had dropped to under 10,000 gallons per year. That is one very clear illustration of the extraordinary effects of Imperial preference.

Now I would like to give your Lordships another illustration of a different aspect, and that is the effect of preferential agreements upon trade between the Commonwealth and countries outside the Commonwealth—say, with America. These are figures of Empire imports from foreign countries, and they are probably the most important at this particular stage. There were imported into the United Kingdom in 1933 £425.9 million worth of goods; in 1937 there were imported into the United Kingdom £622.6 million worth of goods. That is a very considerable increase. Your Lordships will remember that the date 1933 was just after the Ottawa Agreements, when Imperial preference was for the first time imposed. By 1937 your Lordships will see the effects the imposition had had.

I have other figures here, but I will not delay your Lordships long. I would just like to give your Lordships one other set of figures to show that this is not a fluke. Into the Dominions, India and Burma were imported in 1933 £161.6 million worth of goods. In 1937 the figure had risen to £295.6 million worth of goods, a very considerable increase. Those are just figures, and I have tried to show your Lordships the extraordinary effects that Imperial preference has upon our Commonwealth, and not only upon our Commonwealth and this island but upon the whole of world trade. What sheer madness it must be for us in any way to sacrifice it or in any way allow it to be whittled down. Furthermore, I hope that this will show also what an inseparable part it must be of any development scheme for our great Empire.

5.53 p.m.

THE LORD ARCHBISHOP OF CANTERBURY

My Lords, I beg leave to intervene for a few brief moments to say something, if I may, which is very much on my conscience although I have had little opportunity to clothe it in words. Yesterday, from the most reverend Primate, the Archbishop of York, Lord Halifax, Lord Elton and others, there were deeply impressive appeals for national unity at this moment—appeals in which they spoke, I am perfectly certain, for every member of every Party. Not one of us can doubt that, faced with a crisis which threatens our very existence as a great nation, our first need as a nation, and therefore the paramount duty of every one of us, is to minimize to the uttermost possible the things which give rise to internal division and discoid, and to concentrate all our attention, all our energies and all our efforts unitedly upon the grave and serious task of saving the situation.

The Government have declared their intention of raising a constitutional issue by amending the Parliament Act of 1911. I am saying nothing at all either for or against the proposal in itself. I am concerned only with the fact that the proposal is made at this particular moment in our national history. At this particular moment, let me say it again, every matter, whether of high politics or of our domestic behaviour and habits, must be judged by one criterion only: will it help or will it hinder our immediate national task? Will it unite or will it divide the spirit, the attention and the effort of our people? No other question is relevant at all.

The Lord Chancellor said yesterday: Cannot we settle this matter, and bury it for another thirty-six years? For thirty-six years this particular bone of contention has been buried. The Government—and nobody else—have dug it up again. Why? We must apply the only relevant criterion. Have they disinterred it to meet a national need, to meet an immediate national need? Have they disinterred it to increase national unity and national drive? It really distresses me to say that, so far as I can see, the answer to that question must be "No" The reason, the only reason, which has been given to us is that the Government desire to remove a possible danger to their carrying through everything that they desire within the lifetime of this Parliament. To remove this possible danger or decrease it they propose to alter the Constitution.

As I have said, I am not interested in the merits of this proposal at all. It may be ideally a better arrangement that they propose or ideally a worse. I do not know, and at this moment I do not care. The point is that the proposal is arguable, that it has already begun to be argued, that it will go on being argued with increasing heat. Round this bone of contention there will be a dog fight. The Government must have known from the start that the raising of this question would cause inevitable acute political controversy and, therefore, must divert the attention and the energies of the nation from its overwhelming task. The Prime Minister said in another place yesterday: A great deal of time has passed since the Parliament Act of 1911 and it is quite well worth while looking again at that Bill. Very likely. The only relevant question, as I have said, is this: Is it worth while to look at it now? Will it help the nation in its hour of need to throw into the arena this bone of contention or this apple of discord?

I should like the Government to give a plain national answer to that question. I would ask them to consider the position of persons like myself—and I speak here for many many other people. I am non-political in the sense of having no Party politics. I have been—and I think my friends in the Government will agree—by no means unfriendly, by no means over-critical of the Government's actions. I have more than once and in many ways tried my best to help them in their immense task. Not only I but the Churches throughout the country have been behind the Government and have backed them up in their appeals for united effort and united sacrifices, and I may say that the Government have been glad to ask for and to have our assistance. What of us—the non-political men, the non-Party men, the men of good will, the Churches, at this moment, whose one concern is to strengthen and support the spirit, the morale and the unity of our people, and to base it on deep and enduring principles? What can we say now to our people, as all the clamour and the discord of this contentious matter will develop?

If we complain that the Government have gratuitously dug up this bone we shall appear to be opponents of the Government, we shall appear to be taking part in political controversy, and, willy nilly, we shall be doing the one thing we desire not to do, which is to divide the energies of the nation by our complaints. If we argue the merits of the proposal then we shall be in the dog fight ourselves, and we shall, no doubt, find ourselves divided, some for and some against, and the unity of the men of good will of no Party will be broken. Can we go on bidding our people to continue with their hard work, with their sacrifices, with their saving of everything they can save, with their united effort and their Dunkirk spirit, as if this dog fight were not there at all? No doubt, if no other course is left to us, we shall do precisely that thing, but what we say will be drowned by the noise of the fight and will not be heard, and so our dearest efforts will be frustrated.

My Lords, there is, I venture to suggest, the dilemma into which we of no Party, and good people of all Parties, are put. Cannot we be spared, and cannot with us the nation be spared, this confusion? I honestly believe that the country as a whole does not in the least desire this confusion at this moment. It wants to get on with the job. I honestly believe that non-Party men almost universally disapprove of it. I am pretty certain myself that many on the Government side of this and the other House really deplore it too. If it is wanted it is wanted, I believe, only by a section of a section of our people. The Lord Chancellor said yesterday, honestly and humbly, that this Government had made mistakes, as any Government does. Is not this, soberly considered in the view of our national position, really a major mistake?

Having made a gesture, and having seen how it has hurt many of their friends and many men of good will in all Parties, and how it has alarmed them for the very unity of the nation, will the Government not let it be quietly known that they will go no further till the nation is saved, or until this House does something which makes action inevitable? Will they set those for whom I speak free—we who desire to support only the unity of purpose and will of this nation, and who desire to support the Government with all our power as its elected and appointed agent of unity? Will they set us free to speak again with them, or are we to be left dumb and our people distracted from their task? Will the Government, which is calling upon us all to make our sacrifices, make their own sacrifice too for the well-being of the whole? With deep distress of heart and conscience I ask these questions, for on the answer to them depends, I believe, the temper and the spirit in which our people will, through this coming year, meet the Lord of their heavy task. Perhaps on the answer, too, will depend our success or our failure in facing that task.

6.5 p.m.

LORD ALTRINCHAM

My Lords, we have reached the end of the debate, and I only regret that so many of your Lordships silently faded away before the most reverend Primate spoke. I have certainly no wish to detain very much longer those of you who still remain, but I would like to state that now we are ending what can only be the first stage of a series of historic debates if this main proposal is to be persisted in. I think some final words on the subject ought to be said from these Benches, but, before I come to that subject, let me say a word about Imperial Preference. I am really astonished that, apart from passing references to Burma and Ceylon, there is no reference in the gracious Speech to the Commonwealth of Nations or to the Empire. I should have thought that this was a time at which it was worth while to emphasize the importance of co-operation throughout the Empire, as well as the importance of cooperation with the United Nations; but that has not been done. The Empire, apart from Ceylon and Burma, is entirely omitted from the gracious Speech.

That is all the more serious, because rumours are now current that in their pursuit of immediate relief, the Government axe contemplating further concessions which will weaken the structure of our Imperial brotherhood We must face the fact that American ideology in this matter is definitely against the British Empire. It is a long story, a long story of misunderstanding based upon ancient wrongs, but it is a fact. It is also a fact that the American ideology in this matter is as rigid as Communist ideology, and plays into its hands. Our policy of reciprocity and co-operation between kindred and neighbouring groups is, in my belief, vital to the strength of the Empire, to the recovery of Europe, and to the maintenance of peace. I would, therefore, particularly congratulate my noble friends behind me, Lord De L'Isle and Dudley and Lord Fairfax, on the admirable speeches which they delivered on that topic. I will say no more about it tonight because I understand that we are to have an economic debate next week, and I am glad to think that next week the noble Viscount, Lord Addison, the Leader of the House, will be back. We have particular confidence in him. He has always given us the clearest assurances on this question of Imperial Preference, and I am glad to think he will be back and amongst us for next week's debate.

Now I come to the first legislative proposal in the gracious Speech. In regard to its character and its timing, I have nothing to add to what my noble friend, Lord Salisbury, said yesterday in, I thought, admirably pungent terms, or. indeed, to the excellent irony and eloquence of the noble Marquess, Lord Reading, earlier in this debate this afternoon. Few occupants of the Woolsack in the past can have spent a more uncomfortable quarter of an hour than the noble and learned Viscount must have done.

A NOBLE LORD: Oh, he loved it!

LORD ALTRINCHAM

I am sure he did. Nothing could be more harmful to unity, and, as the most reverend Primate has just said, nothing could be more irrelevant to the state of the country in the present desperately critical circumstances, than this proposal. On the broader subject of the constitutional issue I would add only one or two words to make our position here completely clear. There is, of course, a certain measure of importance in the question whether the delay should be of one or two years. I do not wish to underrate the importance of that. But I do not think that is in any way the critical issue which is at stake. If it were only that, it would not be a matter of such importance as we think. But far graver is the assumption which must be made that, if this precedent is created, constitutional changes can be made without reference to or mandate from the country. Far graver is the precedent which acceptance of any such action must create.

The noble and learned Viscount the Lord Chancellor evaded that question of principle. He argued, like the nursemaid in Midshipman Easy, that, although the baby might be of rather shady origin, was it not extremely small? The question of principle raised by this political baby, with its extremely shady origin, is one which no one who stands for the rule of law in our national life should so lightly underrate. I beg leave to illustrate its gravity by reference to one constitutional function of the highest moment which is laid upon this House. The greatest danger arising from single-Chamber domination is the power of a Parliament of a single Chamber, with a temporary majority, to prolong its own life. That is how authoritarian Governments and how dictatorships have become established again and again in the history of the world, and by constitutional means.

That danger is gravely accentuated in this country by two features of our political system. One is that we have no written Constitution. Parliament can, at any time, do anything it likes. The other is that we—or at any rate both the great Parties, for I know that the Liberal Party is not of the same mind—favour an electoral system which provides for large majorities and strong Executives out of all proportion to the majority of votes on which these Executives are based. Both these features give exceptional importance to the constitutional procedure in the relations of the two Houses of Parliament. The Parliament Act deals with that point. It makes express provision in one matter, and it is a matter in which, and the only matter in which, under the Parliament Act, the power of this House is unlimited. That matter is where the Lower Chamber, the popular Chamber, proposes an extension of the life of Parliament—proposes, that is to say, to prolong its own existence beyond the five years laid down in the Parliament Act.

The Lord Chancellor may say: "Well, we will not touch that. You may rely upon us to leave that in the Parliament Act." I believe him when he says that. It would not enter my imagination to suppose that Ministers of the character now governing us would make a change of that kind. But what is the value of the assurances they give us? What right have they to give us their assurances? How can they pledge the future? Once they have opened wide these gates, once this precedent is established, then a fundamental change in our Constitution can be introduced by the will of one House, without consulting the people whose liberties are at stake, without a mandate of even the shadowiest sort. Then indeed the gates will be wide open for further amendments of any kind by the will of one House.

This sudden departure, in the circumstances which have more than once been faithfully described in the course of this debate, is proof enough that the Moderates in the Government cannot always be counted upon to resist measures which they themselves condemn. There is no assurance, except in adequate powers in a Second Chamber, esteemed by the country, that moderation will prevail. The Lord Chancellor himself conceded that. He said, after a tribute which we gratefully recognize to the moderation shown on this side of the House, that after all, my noble friend, the Marquess of Salisbury, the Leader of the Conservative Opposition, is not immortal. Is the Lord Chancellor himself immortal? Is the noble Viscount, Lord Addison, immortal—as we would like him to be? I think he is all but immortal. But even if these moderate Ministers who have yielded in this case are still holding their offices, can they, in the light of this sudden red rocket which they have allowed to burst in the Parliamentary sky, be relied upon to resist further demands for headlong action in purely Party interest?

I am speaking in no partisan sense. In disturbed times extremism and, as my noble friend behind me said very truly yesterday, intolerance also, inevitably gather strength. We, on this side of the House, fear extremism from the Left. Noble Lords opposite may fear it from the Right. Revolutionary action breeds reaction, and who can say, when once they are in opposition to each other, which will prevail? In common with most Englishmen and Englishwomen I have an equal loathing for both. The only safeguard against either, under our system, is a well-balanced Second Chamber holding the country's esteem and confidence.

The real issue, therefore, is not the powers of this House, but the composition of this House, and the Lord Chancellor himself, in fact, conceded that. If the Government will face that, the real issue, we shall welcome it. There is, on this side of the House, no clinging to unearned or unmerited political privilege. The father of my noble friend the Marquess of Salisbury, nay his grandfather, long ago sought to correct that anomaly and anachronism in our State. On March 14, 1910—thirty seven years ago—Lord Rosebery moved Resolutions upon it, which were carried without a Division in this House. In particular he moved: That a necessary condition of such reform and reconstitution is acceptance of the principle that the possession of a peerage should no longer of itself give the right to sit and vote in this House. That complete modification of the hereditary principle was accepted without a Division in this House thirty-seven years ago, and similar Motions have been carried in this House on many occasions since. If the Lord Chancellor fears those legendary Peers known as backwoodsmen, as he said yesterday he did, let him support this House, of which he is the central figure and of which he is so distinguished an ornament, in doing what it has so often sought to do in the past; that is, to reform itself.

It is no fault of this House that reform has never taken place. It is the fault of all Parties in another place. It arises from the fear of the overshadowing of the Commons by this House—a fear which is caused by a proper jealousy of the rights of the other place. I am a very old Member of that other place, and it may be taken in this matter that I am speaking the truth. We have no quarrel here with that sentiment. We feel that the Second Chamber should be so constituted as to balance and complement, but not to overshadow, the popular House. But we also hold, and this we surely will make good if it is challenged before the country, which is the ultimate judge, that a balanced Second Chamber, with adequate powers, is an indispensable guarantee of the liberties which have made this country great. We stand for parliamentary as against authoritarian government and the steps that lead to that. We stand for sanity and moderation and tolerance, without which parliamentary government will be doomed to fatal and final eclipse.

6.22 p.m.

THE SECRETARY OF STATE FOR BURMA (THE EARL OF LISTOWEL)

My Lords, I am sure we agree—and I am glad that there is something about which we can still agree—that the debate we have just heard has not developed into a Party scrimmage or dog fight, in spite of the temptations which must have been fell by a number of speakers to score hits at what they obviously regarded as a fairly vulnerable and exposed target. The tone of the debate was, I think, set by the admirable and characteristic speeches of the two noble Lords who moved and seconded the humble Address. The approach of most of the noble Lords and of course the most reverend Primate, whose words will I have no doubt be deeply pondered by my colleagues of the Government, have teen from the standpoint of national advantage. The debate has been sustained at a level that is worthy of such an occasion, and of similar occasions which your Lordships will remember in the past, and in accordance with the traditions of this House towards the country's problems and difficulties. For my part I will do my best to reply to the points that have been raised by noble Lords, apart, of course, from those covered by my noble and learned friend on the Woolsack when he answered yesterday afternoon. I cannot cover the whole ground, but I will cover as much of it as I can.

The noble Lords, Lord Strabolgi and Lord Lucas, raised the point about the Petroleum Board, and they regretted its dissolution. The facts are these. The Petroleum Board is dissolving in accordance with the terms of the agreement under which it was set up at the Government's request in 1938. This stated that the Board should dissolve within two years of the end of the war or at an earlier date by agreement among its members. The Board has now notified the Government of its intention to dissolve. The Government has, in fact, no power to request its continued operation and we do not regard such a continuance as necessary. It is clear from that, that we have not the authority to keep this body in being, even if we want to do so. I do not think that the unfortunate consequences which the noble Lord, Lord Strabolgi, thought would follow from the dissolution of the Board will in fact occur. I am informed that no dollar expenditure will arise as a result of this dissolution, and I am also informed that although there will be some increase in the number of staff engaged in the distribution of oil, it is considered that the increase will be very small.

A number of noble Lords raised different aspects of the, economic problem that is facing the country to-day—Lord Altrincham, Lord Fairfax of Cameron and Lord De L'Isle and Dudley were particularly concerned about the future of the system of Imperial Preference. I cannot this afternoon give a statement on the subject of our commercial policy, but I can assure the noble Lords that our commercial policy is in concurrence with the views of the Dominion Governments, and that we are therefore not offering to give away anything with which they do not want to part. I can assure these noble Lords that there will be an opportunity for a much fuller reply and discussion in the course of the economic debate next week. Other noble Lords—Lord Swinton, Lord Lucas, Lord Rochdale, and Lord Iddesleigh—dealt with a variety of economic matters and all of these problems which they raised will be dealt with by my noble friend Lord Pakenham, or by any other Government speaker who may reply in the course of the debate next week.

I made a careful note of the points as I sat listening, and noble Lords may be certain that none of them will be overlooked. I can assure noble Lords, although I do not think there is any doubt about it, that the Government do intend to explain without delay their policy to meet these difficulties, and we welcome the opportunity of an early debate in Parliament. In fact, the Minister of Economic Affairs will make a full statement on this subject to-morrow, in another place. This, I think, will give noble Lords plenty of material and they will like time to study and digest it. I am sure, therefore, that next week will be the earliest convenient moment for us to debate the whole economic field, by which time your Lordships will know exactly what we propose to do. I note that the noble Lord, Lord Cherwell, already has a Motion on the Table for next Wednesday.

The noble Lord, Lord Rankeillour, was good enough to give me advance notice of the points he meant to raise about Burma, and I will give him as full a reply as I am in a position to provide. I cannot give the noble Lord the complete answer which he might have expected, because neither the Treaty with Burma nor the Burma Bill have yet been published. The defence arrangements, for example, are dealt with in the Treaty and the noble Lord will be in a position to judge for himself the merits or otherwise of these arrangements as soon as the Treaty is published, on Friday. And, of course, the contents of the Treaty will be a matter for discussion during the Second Reading debate on the Bill in this House and in another place. I should like to make it abundantly clear that although the Treaty has been signed, it has not yet been ratified, either by Burma or by His Majesty's Government. We shall not ratify the Treaty until after the Bill has been passed by both Houses of Parliament. I think that is the proper constitutional procedure. Similarly in Burma it is waiting the sanction of the Constituent Assembly.

I think I can reassure the noble Lord about the position of the minorities in Burma and the inhabitants of the frontier areas. We have taken the line all along that they should have complete freedom to settle their own future relationship with Burma. The settlement that has now been reached does the utmost credit to the moderation and willingness to co-operate shown on both sides, and promises well for the unity and strength of the future Union of Burma. The new Constitution of Burma, of which I will send the noble Lord a copy (I am sorry he has not already received one) was voted unanimously by the Constituent Assembly, which included representatives of the Chins, the Kachins, the Shans, the Karens, whom the noble Lord mentioned, as well as representatives of the Karenni States. It safeguards in two ways the interests that minorities have in Burma: by a guarantee of fundamental rights, and by establishing the structure of the new Union of Burma as a Federal State. The noble Lord will find that in Articles 13 and 14 of the Constitution all citizens, irrespective of birth, religion, sex or race, are to have equality before the law, immunity from discrimination, and equal opportunity of entry into public or private employment.

The provisions of the Constitution are enforceable in the courts, and cases can be brought before the Supreme Court of Burma. The federal structure of the Constitution gives the units in that federation control over their own internal affairs, while the Federal Government will control matters of common concern to the whole of Burma, such as defence, foreign relations, communications or currency. There will be, to start: with, a Shan State, a Kachin State and a Karenni State. At a future date a Karen State may be added, if the majority of the "Karens themselves in the hills and the plains so desire. That is provided for in terms in the Constitution.

I think we all feel a great and especial sense of responsibility for the future of the Karens, who played such a gallant part with Force 136 in the war, when a number of them parachuted into Japanese-occupied Burma. They were among those who gave us the most help in driving out the Japanese. In the course of my short stay in Rangoon, I had extremely friendly talks with representatives of all the Karen interests, and I was delighted to find that they were anxious and willing to co-operate with the Burmese in building up their great new country. The Government of Burma have met them half-way by giving them a Karen Minister in the Cabinet, who will be in a position to look after their minority interests, and their own schools and cultural institutions in those parts of Burma where most of them live. They are mainly, as the noble Lord rightly pointed out, in the plains inextricably mingled with the Burmese. It is, therefore, necessary to give them the protection they require without in any way encroaching on the rights of the Burmese.

The noble Lord will, I think, be reassured to know that this admirable Constitution, which guarantees a square-deal for the minority elements in the population, cannot be altered lightly or without proper regard to the wishes of those whom its alteration would affect. Amendments to the Constitution require a two-thirds majority of both Chambers in joint session, and where they touch the rights of the new States, or special interests, a majority also of the representatives of the interests concerned, there sitting and voting or not voting as they choose. There is no question of their being swamped in a vote by the majority of the Legislature. What matters, I think, far more than any paper guarantees is the spirit in which they will be acted upon. I am satisfied from my personal knowledge of the Burmese political leaders, all of whom I met when I was in Rangoon, that their good will towards their minorities is entirely genuine, and that they intend to give them complete equality of treatment and consideration in the now Burma. It is interesting evidence of the keenness of this desire, that they themselves (the Burmese) have already chosen a Shan, the Sawbwa of Yaungwe, to fill the highest office in the Union of Burma, that of President of the Republic, as soon as sovereignty has been transferred. It is surely an extremely good omen for the future that considerations of this kind should have dictated the filling of this high office. The noble Lord asked me a question about the position of the European members of the—

LORD RANKEILLOUR

Before the noble Lord leaves that point, may I ask one question? Can this Constitution be altered without the consent of the majority of the Minorities, if I may put it that way?

THE EARL OF LISTOWEL

I tried to make that point clear. If it were suggested, for instance, to alter the rights of the States in the Federal Union, then the consent of the majority of the representatives of those States in the Legislature would have to be obtained. I give that as an example of tire general rule that any alterations that affect the rights and interests of minorities have to have the consent of those minorities.

Let me tell the noble Lord what I can about the position of these officers of the Government of Burma. They are servants of the Government of Burma—I think that should be made clear—and have to look to the Government of Burma for a decision as to the terms to be offered them on the transfer of power. At the same time, we have been doing whatever we can to see that fair treatment is accorded to them. I took part in these discussions myself, and I am quite satisfied that the present Government of Burma is most anxious to meet their requirements and shares our desire that they should have a fair deal. Negotiations and discussions have been proceeding for some time and it should be possible in the very near future, and I hope well in advance of the Second Reading of the Burma Independence Bill in another place, to make public the terms which will be offered to the various categories of these officers.

THE EARL OF SELBORNE

The noble Earl will forgive me for interrupting. I would like to ask whether it is the fact that the terms safeguarding the rights of our officers do not form any part of the Treaty.

THE EARL OF LISTOWEL

No, that is not the case. So far as the Secretary of State's officers are concerned they are covered in the Treaty. The terms, of course, will be published simultaneously with the Treaty. So far as the servants of the Government of Burma are concerned—for instance, railway officers, veterinary officers, and so on—their terms are a matter for the Government of Burma, and will be published when the Government of Burma agrees that their publication should take place, and, of course, after they have been decided. They are outside the Treaty.

The noble Lord, Lord Rankeillour, complained of what had happened in India as a result of our policy, and said that he considered that we had committed a grievous sin. I think it is most important to see the events in India in a true perspective. This should not lessen in the slightest our sympathy for the grim plight of the refugees, or of the victims of the horror and brutality of communal warfare. We must also, I think, sympathize with the two young Governments of India and Pakistan, which have been faced with these tragic events while they are still engaged in building up their own administrative machine. It is, however, not recognized in all quarters that these disturbances have been limited to two out of the fourteen provinces of India and Pakistan, and have affected a very small proportion of the total population of the Indian sub-continent. The vast majority of the inhabitants of this subcontinent, I am happy to say, are living in peace and security, and have not been touched by what has happened in the Punjab. Exaggerated reports about these events inevitably add fuel to the flames of communal passion and do harm to our relations with both Dominions. I think it is vitally important that these things should be seen in a true and correct perspective.

LORD RANKEILLOUR

I do not think the noble Earl said anything about the questions of defence or how the Supreme Court in Burma is to be appointed.

THE EARL OF LISTOWEL

I did mention defence, and I think I would rather inform the noble Lord about the technical procedure of the appointment of the Supreme Court afterwards, because it is a matter of comparative detail and I have a lot more to say in reply to other speakers in the debate.

The noble Lord, Lord Dukeston, referred to the prospect of rapid economic progress in the Colonies. Of course, we attach immense importance to this, both as a means of raising the standard of living in the Colonies and of improving at the earliest possible moment our own meagre rations. This is not the only form of progress that is now within sight, for there are welcome indications of further constitutional advance. I hope that this will satisfy the noble Lord, Lord de L'Isle and Dudley, and other noble Lords who have spoken rather regretfully about our neglect in respect of the Commonwealth, that we are doing our utmost to secure its future. It is a sign, I think, of the robust vitality of the Commonwealth that the evolution of its Dependencies towards a higher degree of self-government, which was temporarily arrested by the war, has now been generally resumed. The strength of the Commonwealth lies in its capacity for adapting existing institutions with little delay to meet changes in social or political conditions.

The problem of the nineteenth century was how the White Colonies were to achieve their independence without severing their moral ties with the Mother Country. A solution was found in the freedom and equality of Dominion status. The problem of this century is how the coloured peoples under British Rule are to secure their political aims without losing the sense of partnership with us in a world-wide family of nations.

An important step forward in this direction is about to be taken by Ceylon. I am delighted to have the support of noble Lords opposite, exampled by the noble Viscount, Lord Swinton, for the efforts we have made and are making to accelerate the political advance of Ceylon. I am quite sure that what the noble Viscount said, coming as it did from a former Secretary of State for the Colonies, will be particularly valuable both at home and in Ceylon. I am glad to be able to inform your Lordships that His Majesty's Government's declaration concerning future constitutional development in Ceylon was warmly acclaimed when it was conveyed to that country. The General Elections have now taken place and a new Government under the leadership of Mr. Senanayake, the Prime Minister, has been formed. His Majesty's Government anticipate that in the very near future agreements on a variety of matters will have been concluded with this Government. The way will then be open for the legislation foreshadowed in the gracious Speech conferring full responsible status on Ceylon. I feel sure that your Lordships will agree that, since the people of Ceylon have proved in peace and in war their ability to conduct their own affairs within the framework of their own democratic institutions, the necessary action to implement our declaration should be taken without delay.

The noble Lord, Lord Strabolgi, was also good enough to give me advance notice of the points he intended to raise, and therefore I will answer him more fully than I will answer some noble Lords on. the question of reparations from Germany. Our proposals for taking reparations from Germany are bound up with the main principles of our policy towards Germany, which I believe your Lordships have already approved. I will only remind the House of its two essential features. The first is to create a political situation in Germany that will prevent the rise of another dictator and make impossible the revival of an aggressive policy that has led to two world wars.

The second is to encourage the development of German production and trade, until that country becomes not only self-supporting, but able to repay what the Allies have spent on her since the occupation and to make good the damage done by the Wehrmacht during the war. The economic recovery of Germany to this point will also help to reconstruct and raise the standard of living in other European countries, which will benefit greatly from German coal and manufactured products. Of course we shall prevent the simultaneous building up of a German industrial war potential.

These are the principal considerations we had in mind in fixing the level of German industry, and in our plan for distributing surplus industrial plant and equipment as reparations. We are bound in this matter by the terms of two solemn engagements. We have undertaken, both by the Potsdam Agreement and by the final Act of the Paris Conference on Reparation, to distribute as reparations plant which is surplus to the authorized level of German industry. It is surely unthinkable that we should tear up these Agreements on the eve of the November meeting of the Council of Foreign Ministers. In that event we should have to abandon all the hope of a settlement which might well result in a stable and united Europe. The present reparations plan contains as complete a statement of the reparations which will be taken from the British and American zones as is possible at this stage, though a few industries on the prohibitive list remain for examination. The present plan is intended to carry out the proposals in the plan for the level of industry in the Anglo-American zones which was published last August. The object of this scheme was to remove industrial capacity which might reasonably be regarded as contributing to German war potential, but at the same time to leave an industrial capacity sufficient for the German people to achieve and maintain a decent standard of living.

We have been criticized by people who say that the real purpose of our level of industry and reparations plans is to restrict German competition in world markets for the sake of our own selfish interests. These allegations are completely without foundation.

LORD STRABOLGI

My noble friend realizes that I mentioned nothing of the kind myself and do not support this allegation.

THE EARL OF LISTOWEL

I, of course, realize that, and I make no suggestion of the kind. We have consistently pressed for a substantial increase in the level of industry fixed by the Control Council in March, 1946, and I should like to emphasize the big difference between the present plan and the plan for the level of industry drawn up in the spring of 1946. Under the original plan 1,636 plants were scheduled for removal. The list of plants, to be removed under this plan is much shorter, and covers only 682 plants, or less than half the number included in the original figure. The plan can be seen in its proper perspective when it is appreciated that less than one per cent. of the names of industrial plants in the British zone appear on the reparations list. It is surely the most elementary justice that Germans in these two zones should make their contribution to the total of German reparations, by giving up that part of their industrial capacity which was built up after 1936 by the Hitler régime, with the waging of war as its purpose.

It has been argued that the removal of equipment from these two zones is incompatible with what Western Germany is expected to do under the Marshall Plan. This is not the case. I rather think that an argument of this kind is in the noble Lord's mind. The industrial capacity to be retained under the present level of industry plan will be more than enough to enable them to make the maximum contribution of which they are capable within the framework of the Marshall Plan for the economic recovery of Europe. Indeed, industrial plant is of no value without fuel, power and the necessary raw materials. If we were to leave more capacity in Germany than is now authorized, its output would be limited and crippled by inevitable shortages. To stop dismantling would be to allow plant to rot in Germany which, if and when removed, will become an important asset in the industrial rehabilitation of the rest of Europe. The reparations programme should therefore be regarded not only as a partial recompense for damage done during the war but also as a contribution by Western Germany to the process of European recovery by mutual aid.

The view has been expressed in Germany and elsewhere that the whole character of the reparations programme should be altered, and that the principle of payment out of current production should be substituted for that of removal of surplus capital equipment. This is quite unacceptable, and I should like to explain the reasons for our view. The history of reparations after the last war is itself surely a sufficient condemnation of this method of obtaining payment. The reparations clauses of the Potsdam Agreement were devised to avoid the breakdown experienced after 1918. It will be some years before German production can be raised to a level which will enable her to achieve a balance of payments. Until she does so, reparations from current production can only be obtained at the expense of the ocupying Power or Powers. This may be a satisfactory arrangement to the Germans, and to the recipients of reparations. But His Majesty's Government have No 1ntention of liquidating any part of the German obligation to pay reparations at the expense of the British taxpayers.

VISCOUNT SWINTON

The list is now agreed between us and the Americans?

THE EARL OF LISTOWEL

Yes, I understand so. I have spoken to the Chancellor of the Duchy, who knows far more about these matters than I do.

Let me say this in conclusion. The Government are determined to carry through, in co-operation with the American authorities, the reparations plan which has just been published. The United Kingdom has borne a heavy and almost intolerable burden in sustaining the British zone since the occupation of Germany. Whatever the result of the present negotiations in Washington, this burden will continue in part. Germany will depend for a long time to come on help from the outside world, if not for the maintenance of life at least for the reconstruction of her economy and an early attainment of a reasonable standard of living. Unless her people co-operate in making this small measure of reparation to the damaged countries of Europe which the programme represents, they will prejudice their own case for assistance from others.

I should like to say one brief word about the Council of Foreign Ministers which is to meet in London next month. Your Lordships may be certain that His Majesty's Government are determined to do all they possibly can to make this momentous conference a success. We have been criticized by some people for not accepting the partition of Germany as an accomplished fact, but we have not held the door open for so long only to shut it at the last moment, and it is our firm intention to do all we reasonably can to make the four-Power agreement a reality. I am sure that your Lordships share with me an intense admiration for the inexhaustible patience and dogged perseverance of the Foreign Secretary, during many weary years and throughout a number of abortive conferences. The essential condition on which the Foreign Ministers must agree is that Germany should be treated as an economic whole. It is not this country's fault that Germany has not so far been treated in this way and our efforts at this Conference will be to secure a reversal of what has happened in this respect in times past.

I am glad to have this opportunity, thanks to the noble Earl, Lord Perth's kindness in communicating with me in advance, of assuring your Lordships that His Majesty's Government have No 1ntention of abating their determination to do all they can to secure a free and sovereign Austrian State which will have a reasonable prospect of economic prosperity. The Austrian Treaty Commission, which has sat in Vienna throughout the summer months, has failed to solve any of the unagreed articles of the Treaty left over from Moscow, and we are fully aware of the concern with which the long delay in concluding a treaty is viewed in Austria. Nevertheless, our experts in Vienna have been able to acquire a very fair picture of the German assets problem, and we still feel that it will be possible to arrive at a just settlement of this complex question. We want to see the development of a prosperous; Austrian economy, to ensure the independent status of Austria and at the same time to satisfy legitimate Allied claims.

THE EARL OF PERTH

Can the noble Earl give an assurance that we shall do our utmost to ensure that the integrity of Austria will not be in any way diminished?

THE EARL OF LISTOWEL

Yes. What I have said covers the territorial integrity, and it applies to the boundary. I should like to conclude by apologizing to those noble Lords to whose points I have not been able to reply, and to thank the House for a survey of the situation which I am sure will be of the utmost value to myself and to my colleagues in the Government.

THE MARQUESS OF READING

I put one very direct question to the noble Earl in my speech. I said I hoped he might state whether the Government contended that they had at this stage a mandate for the introduction of the Bill to amend the Parliament Act.

THE MARQUESS OF SALISBURY

Cannot we get an answer, if not from the noble Earl, from the noble and learned Viscount on the Woolsack? This is a point which I also made. I made it yesterday, and it was entirely ignored in the noble and learned Viscount's speech.

THE LORD CHANCELLOR

I think it inconvenient to raise the point at this stage. Noble Lords will have read the Prime Minister's speech made in another place last evening and I can add no more at this stage. The Prime Minister called attention to the fact that in Let us Face the Future, the words were—

THE MARQUESS OF SALISBURY

"We will not tolerate … "

THE LORD CHANCELLOR

What the Prime Minister in effect said was this: that so long as there was no obstruction this clause will do no harm. It is therefore, he said, put in as a precaution, to prevent the obstruction which he said might otherwise take place. That is my recollection of the way the Prime Minister put it, and naturally I should not desire to put it in any different way. I would commend to your Lordships the Prime Minister's words on this matter, which were very carefully considered beforehand, and I really think that that is the best answer I can give.

On Question, Motion agreed to, nemine dissentiente: the said Address to be presented to His Majesty by the Lords with White Staves.