HL Deb 05 July 1951 vol 172 cc684-707

4.10 p.m.

Debate resumed.

THE EARL OF HALIFAX

My Lords, in reverting to the matter that was before your Lordships prior to the noble and learned Viscount's Statement, I should like to make two observations on the remarks that fell from my noble friend Lord Cherwell. From the background of wide knowledge and, I thought, with great persuasiveness, he drew a picture of a situation which, I think, those of your Lordships who have frequently pondered how sharply, in certain circumstances, the fate of our nation and of Western civilisation might depend upon these issues must have found very disturbing. I have no doubt that in all parts of your Lordships' House there will be readiness to consider, entirely dispassionately, and from the single point of view of what may be judged to be national advantage and interest, the issue that he has raised.

It is a very special subject which the noble Lord has brought before us, and certainly I can claim no special knowledge in regard to it. Indeed, I should be utterly unqualified to follow much of the more technical side of the discussion which my noble friend has led. My only claim to intervene for a moment or two is the fact that during the war I had the opportunity of seeing a good deal in the United States of the way in which they handled this particular problem, and of noting their approach to this very highly technical and extremely vital side of production as part of the great war effort. That was at a time when the co-operation between the United States and this country was more intimate and more complete than I suppose it has ever been. Their handling of this question was entirely sui generis—it was something entirely by itself and, in the words of my noble friend's Motion, it was certainly flexible the extreme. The idea of hurdling this question on the model of an ordinary production problem was poles re noved from what the Americans actually did and I should have thought that it was safe to say that had they treated it in any way as an ordinary production problem they would never have been able to achieve the results, either on the scale or at the pace which they did achieve. It is very difficult, of course, and I am inclined to think almost impossible, to compare American administrative methods with ours. They are very different, and I am bound to say that do not always want your Lordships to imitate them. In the politico-constitutional field, the differences are often apt to be as great as they are in the field of industry, and therefore any narrow comparison of methods is apt to be misleading and largely irrelevant.

For these reasons, in my view it is only on the broad lines of general principle that one can usefully attempt comparison. By that test, the argument of my noble friend that the American special methods of treatment should be operated, and are better calculated than our own to secure the results which we all want to be quickly achieved, is irrefutable. I have not made sufficient research into some fields of modern political ac tivity to say how the administrative methods employed in this field might compare with those employed by the Government in other cases. In some special ventures into which this Government have gone, they have been prepared to relax the strict canons of Treasury administration with great liberality and that has presumably been done in the interests of achievement. It may not always have been successful, but that was the laudable purpose the Government had set before them. Far he it from me to say that in all cases he who would relax the strict canons of Treasury administration would be wrong. In many cases he might be right. At all events, that is what the Government have done in some cases, though not always successfully. It is a simple point and not a controversial one that I am trying to make. There is no comparison whatever between the urgency of producing groundnuts, shall we say, in East Africa, and relaxing all the canons in order to get atom bombs quickly made. What is possible for one is very much more urgent for the other. If, therefore, the noble Lord is right in feeling and arguing that the Government have unconsciously and I emphasise "unconsciously"— been placing the interests of Treasury security before the interests of national security, he is abundantly right to bring the matter before your Lordships for the expression of your views.

May I say one other word on a point upon which he touched, but on which I should like to touch from another angle? Apart from the question of production, on this matter I should expect United States opinion—which is the most intimate and sensitive point of the collaboration between the two nations—to be very sensitive indeed on the side of security, especially after recent events here. Whether or not such thought is well-founded, I venture to submit, with all respect, is not the real point. The point is that that thought would be held, and, not at all unnaturally, would exercise very considerable influence on American thinking. Therefore, I would hope, as the noble Lord said, that he was preaching to the converted, and that when the noble Viscount replies for the Government he will be able to give reassurance to the House on the broad case which my noble friend has presented to him.

4.20 p.m.

VISCOUNT SWINTON

My Lords. I am sure that what has already been said shows that this matter is urgent both in importance and in time. It is seven months since we last debated this subject in this House. We were then debating it in relation to security, though the efficiency of the orgarnsation was also touched on. I then ventured to make much the same proposal as my noble friend Lord Cherwell has made specifically in the Motion which is before your Lord ships to-day. The Lord Chancellor then said that this plan had obvious advantages though there were certain disadvantages; and he said that the matter must be regarded as in no sense closed. That was seven months ago. Seven urgent months have passed, and evidence has accumulated in favour of the flexible organisation. Indeed, not only is evidence accumulating but an acute crisis has been reached. But, all through, the Government have let this business drift. I hope that my noble friend Lord Halifax is right and that the Government are going to agree to make this change. If so, no one will attempt to make a Party score, and we shall all rejoice. I do not mind where the credit goes. But, from all I have been able to learn, not only has there been a drift but the drift has been in the wrong direction.

On the scientific side Lord Cherwell speaks with very great authority. On what has happened within the organisation he speaks, I know, with first-hand knowledge. Throughout he has done his best to help. Technically his case is unanswerable. So far as I know, every scientist who has expressed an opinion, either in public or in private, has supported him. On the technical side his case is, as I say, unanswerable and it certainly is unanswered. I think I am justified in saying that a crisis has been reached. Mr. Perrin, who has been the Deputy, possessed of the most universal knowledge throughout, has gone. It is perhaps wrong, as a rule, to use the word "indispensable" of any man; but if ever the word were justified in connection with a great and difficult project, I take it that that adjective could be applied to Mr. Perrin in connection with this work. Lord Portal is going. Both are leaving a vital task to which they have given their great abilities and whole-hearted service; and they are leaving, as I understand it, because after full trial they are convinced that the Government plan will not work.

May I say one word as an ex-Minister—like my noble friend Lord Halifax—on the question of financial control, because I understand that that is a strong Treasury argument? There are ample precedents for doing what is now proposed. Of course, the nationalised boards have far less Treasury control than the proposed organisation directly responsible to the Government. We passed yesterday a Bill to give another £150,000,000 to the Coal Board. There will be no Treasury control over that. We had a formula read out about something which would happen; frankly, I could not quite follow what it was. The Paymaster General, who was the Minister in charge of the Bill, said that, generally speaking, the money was spent before one could inquire about it, and I agree that that is so. But may I take a parallel with which I myself was very closely connected, and which I think is exact? At the beginning of the war the Prime Minister sent for me and said that the Government felt that no Government machine could adequately conduct economic warfare. They knew what they wanted to do; the policy could be settled on the highest level; but if they wanted the policy carried out an entirely new organisation would be required.

At his request, a number of very able colleagues and myself founded the United Kingdom Commercial Corporation. It was charged not only with the whole of the executive side of economic warfare, in the sense of buying vital materials and denying them to the enemy, but with a much wider field—sustaining the economies of many neutral countries. Turkey, for instance, was sustained by it throughout the war. It had a vast variety of activities. It had a capital, provided entirely by the Treasury, which varied from time to time from £80,000,000 to £90,000,000. It had a turnover in a single year of, I think, over £150,000,000. It selected whom it would employ and paid whatever it thought necessary: some of the best were paid a dollar a day and some not even that. But where necessary it paid large salaries to people all over the world and that was done with the fullest Treasury approval.

It is quite true that it had two sides: the commercial side, on which the Corporation made a profit of something like £20,000,000; and another side, wholly uncommercial, which was at all costs to deny the enemy vital material. You could not make money by buying wolfram against the Germans at £5,000 per ton when the price at which you could sell it was well under £500—I think nearer £200. Of course on that side of the business there could be no question of making profits. The Treasury entrusted all that to the Corporation and indeed pressed for it at the time, because they knew—and they were right— that an organisation of that kind was the best way of getting the business done. They thought it was the only way and, what was more, the best way of getting value for the Treasury money which was going to be spent. Indeed, Dr. Dalton claimed it as a triumph of State enterprise which was the last thing it was. It could not have begun to work if it had been a Civil Service Department —and none of the men who made it succeed would have come in to work it if they had been asked to come in graded as civil servants under Civil Service restrictions. Therefore I submit that the argument of Treasury control will not hold water.

I turn now to a matter on which I can speak with some experience. I cannot speak with first-hand knowledge of the scientific side; but I can speak with perhaps as much experience as anybody in this House on the question of security. I most fully agree with what the noble Earl, Lord Halifax, said about the importance which the Americans attach to this matter cud the way they would look at it. Like the noble Earl, having worked closely with them on security matters during the war, I say that, too. They not only feel that way, I am sure, but they are right to feel that way. Speaking with the fullest sense of responsibility, I say that the case on the security side is as strong as it is on the scientific side and the efficiency side. Of all matters, this subject of atomic energy is the most vital one in which we must keep secrecy, and no one will say that it is one in which we have been outstandingly successful.

I am not going to discuss ways and means—it would be most improper for me to do in public—but I say categorically that we cannot in this affair have the requisite security in a Civil Service stet-up, subject to Civil Service conditions. Under the Civil Service system you cannot engage a man subject to special conditions, because the Civil Service system is necessarily a sealed pattern and uniform in its methods. Let me take a few examples of conditions which I am sure such a flexible organisation as my noble friend has proposed ought to be free to impose in the interests of security. It should be able to say to a man in its employ, and ought to make it a condition of his employment "You shall not go abroad without the permission of your employers." It can say to him (you could not say it to the Civil Service): "As a guarantee of good faith, you shall deposit your passport with me." Nobody, no honest man, would object to that. When I was engaged in great questions of security and charged with many secrets, I should have said: "I am the first person who should be made subject to whatever are the proper supervisions and restrictions." if those conditions had been applied to Mr. Pontecorvo, would Mr. Pontecorvo ever have left this country? He could not have done so. It should be a condition that a man's services can be dispensed with without notice and without reason. "Without reason" is as important as "without notice," and no one who knows anything about security and has had to deal with security will dream of denying that for a moment.

Those are conditions which cannot be applied in the Civil Service. Of course they cannot. I know it would mean paying a higher salary but, as my noble friend said, what is that? It would mean paying a man a lamp sum in lieu of notice. What is that to weigh in the scale against security? I believe that for some of the staff and, maybe, quite a number I am not speaking of them personally, but by reason of the work they are to do and the secrets with which they are to be charged—conditions of that sort are essential conditions, both as a term of entering the employment of this organisation and as a condition of leaving it. Of course, they are impossible in the Civil Service. They are perfectly easy in a specialised organisation; and, by applying those conditions in a special organisation, no precedent whatever is created, either of terms of payment or of conditions of service for the rank and file of the Civil Service.

I beg the Government to change their minds, unless they are of one mind with all the noble Lords who have spoken. There really is no time to be lost. This is a great national interest. I do not think it is too much to say that it is in jeopardy; certainly, it is floundering. I beg the Government to believe that they will not lose face in doing what all best informed and most responsible experience urges them to do. I understand it can be done under the Act as it stands, but, if it cannot, I can promise the Government that if they will introduce a Bill to enable them to do what they ought to do, that Bill will go through this House in a day, and I am sure it would go through another place. I beg the Government to do this. We will give them all the help and support we can. But, if they still refuse—well, then I think the House must show by its vote that the majority of us consider that this change is indispensable alike to the efficiency and the security of this vital work.

4.38 p.m.

THE CHANCELLOR OF THE DUCHY OF LANCASTER (VISCOUNT ALEXANDER OF HILLSBOROUGH)

My Lords, we are considering to-day a Resolution by the noble Lord, Lord Cherwell, with regard to the development of atomic energy, and it raises issues on a problem which not only has great international complications, but is of the greatest importance to the well-being of our country. The noble Lord who opened the debate can rest assured that, the matter being of such importance, we have no complaint to make about it being discussed in the manner in which it has been dealt with to-day. The problem has been previously discussed, both here and in another place. In general, I think, the discussions have taken place on non-Party lines, and in a spirit of common endeavour to decide upon the machinery for the development of atomic energy which would best serve the interests of the nation. At any rate, I can say for the Government that we certainly do not regard such an issue as this as a Party matter. With regard to almost the last point that fell from the noble Viscount, Lord Swinton, I would say that we should never be concerned about the question of losing face if, in dealing with a matter of such vast importance, we had to change our opinion at any time. After all, a Minister's duty is always to have regard to the ultimate highest good of his country and of his fellow citizens. Therefore, we look at the problem not from the Party point of view but purely from the objective point of view of making the maximum progress through the most appropriate machinery.

This Resolution, which was so ably moved this afternoon by the noble Lord, Lord Cherwell, alleges that atomic energy progress in this country has been unduly slow, and the noble Lord has made a proposal that work on the subject should be transferred from the Ministry of Supply to a special organisation—and I now quote: more flexible than the normal Civil Service system. on the assumption that such an organisation would have made quicker progress in the past and might reasonably be expected to make quicker progress in the future. In considering the progress which has already been made in the development of atomic energy in this country, I am sure that noble Lords will bear in mind certain historical facts which, I submit, are relevant to the matter.

In the first place, as the Minister of State has already explained in another place, our efforts in the development of atomic energy were deployed during the war in North America, where our scientists and experts, working in close collaboration, not only, as the noble Earl, Lord Halifax suggested, with the Americans but with the Canadians as well, contributed in no small measure to the successful development of atomic weapons. The reasons for the deployment of our efforts in this way are well known to your Lordships—to none better than those who have spoken from the Opposition Benches to-day—and no one would quarrel with the decisions which were then taken, or with the way in which our effort in atomic directions was deployed during the war. But the inevitable result was that facilities for the development of atomic energy were not deployed in this country, and apart from the valuable experience and knowledge which our experts and technologists acquired in North America, we in this country began to develop atomic energy in 1946 more or less from the green field stage. Furthermore, we began at a time when we were faced with the task of rebuilding our economy after the ravages of war, the burden of which we had borne throughout the whole of the war, and without the almost unlimited industrial capacity and war-time Government powers which were available to the United States during the war, or the advantages, from this particular point of view, of the totalitarian economy of Russia. Here may I say, in reference to Lord Cherwell's remarks about the progress made by Russia, that I, at any rate, should not like our country to have to rely upon some of the methods of labour organisation used by the Russians to achieve what they have done in the time.

Now may I turn to the general charge that developments in this country have been especially slow? Of course, what the Government look for is evidence which can be assessed and checked. A colleague of mine in the Ministry received a letter, quite unsought, just two days ago from Lord Adams. one of your Lordships' colleagues in this House. Lord Adams is the chairman and managing director of the West Cumberland Industry Development Company. He has done great work there, and he was connected with the original negotiations and the subsequent development of a place which I am sure Lord Cherwell knows all about—namely, Sellafield. Unfortunatey, although he would have liked to come and take part in the debate himself. Lord Adams is too unwell; but he says in his letter that he regards the Resolution on the Paper today as dangerous. He says that when the decision to develop Sellafield was announced in July, 1947, he, like many other people, thought in terms of an ordinary factory. But he goes on to say: During the last four years, I have been amazed by the size of the project and the rapidity with which work has proceeded. There have been occasions when, because of this factory other projects in the development scheme have been affected adversely. … Other work has suffered from a shortage of bricks, structural steel, etc. Here is one of our colleagues doing great work in that area, and paying tribute to the speed of the development there. In the same letter he goes on to say that it was all completed well within the time schedule. That demonstrates to your Lordships that the present system, which the Resolution desires to change, is not in any way interfering with the proper and speedy use of the top priority which has always been accorded to matters relating to the development of our atomic energy processes. I do not think I need say more about that side of it at the present time; I will merely refer to tile letter again on another question.

Undoubtedly a great deal has been done in this country since the beginning of 1946. I am sure your Lordships will appreciate, and none better than the mover of be Motion, that for security reasons I cannot go into great detail. But a great research establishment has been set up at Harwell; a number of large production establishments, each one of them a major industrial enterprise, have been planned and built, and some of them are now operating; and much progress has been made in the development of atomic weapons. On the civil side, a great deal of work has been done on the design of power reactors and design studies, and pilot plant works are in progress or in early prospect, both for the production of power and for new methods of propulsion. As the noble Lord, Lord Cherwell knows, perhaps better than any other member of your Lordships' House, a very large business has been built up at Harwell for the production and distribution, not only in this country but in many overseas countries, of radio-active and stable isotopes.

The Government are of the opinion that, considering the circumstances in which arrangements for the development of atomic energy in this country were made, very good progress has been achieved, especially having regard to the fact that we have had to work largely on our own. The tripartite partnership between ourselves, the United States and Canada continues for certain purposes in the atomic energy field, and we co-operate with those countries under arrangements made from time to time by the Combined Policy Committee, which was set up in 1943 by the three Governments, and which meets periodically in Washington. Naturally, the Government are ready at all times to examine with the United States of America the possibility of extending the area of co-operation in the atomic energy field. The United States Government are fully aware of this fact. But it must be remembered that the exchange of information between ourselves and the United States has been restricted since the passing by Congress in 1946 of their Atomic Energy Act, commonly known as the McMahon Act. The present restrictions, of course, cut both ways. We have had to solve technical problems in our own way. We have been able to allow for certain technical advances, and to incorporate modifications necessitated by the limited area and physical resources of this Island, and we believe that in some respects we have even improved upon what might otherwise have been only a replica of American processes.

The burden of the Resolution before your Lordships' House, however, is that the development of atomic energy in this country would be more effective in the hands of a special organisation, "more flexible," as the motion puts it, "than the normal Civil Service system." I should like to make it clear that nobody has yet finally made up his mind as to what would be the most effective organisation for the ultimate development of atomic energy. I believe that it was the noble Viscount, Lord Swinton, who suggested that every prominent scientist was in favour of the method set out in the Resolution on the Order Paper. I must say, however, that, whilst I know that a great many scientists have expressed that opinion, it is not by any means an opinion which is universally held. We know that from the results of inquiries which we have made. I should like to make it clear, therefore, that whilst no one has yet finally made up his mind as to what would be the most effective organisation for the ultimate development of atomic energy, at the present time the Government are not convinced that a special organisation would be any more effective than the present arrangements.

I would remind your Lordships that although the noble Lord, Lord Cherwell, voiced certain doubts this afternoon, and said that he also expressed some doubt at the time of the passing of the Atomic Energy Act of 1946, the Opposition as a whole did not, at that time, object strongly to the present policy of the Government as embodied in the Act—that is, the policy of giving responsibility to the Minister of Supply and making the atomic energy organisation a part—though in practice rather a special and separate part—of the Ministry of Supply. It is, of course, easy to speak in general terms of a special organisation "more flexible than the normal Civil Service system," and to imagine an organisation, with unlimited funds and unlimited power, free to do whatever it liked. But in the real world such an organisation would have to work to a budget, and with funds provided by Parliament. In that connection I was very glad to note that Lord Cherwell did not complain that the Government had at any time not been helpful or sympathetic, nor did he complain that through Government action any handicap had been imposed on this project by reason of lack of funds.

LORD CHERWELL

Full of good intentions.

VISCOUNT ALEXANDER OF HILLS-BOROUGH

I understood him to say that the work had not been hampered by lack of funds at any time. That shows rather more than mere good intentions on the part of the Government. A special organisation would have to work among the same difficulties, the same shortages and the same frustrations which have confronted not only the Civil Service but every department of industry in this country, because of our post-war economic circumstances. Ask any section of industry or any section of life in the country at the present time what they have to face because of the tremendous sacrifices we had to make during the war and the enormous burdens which we have had to shoulder in our effort for economic reconstruction. As a special organisation entirely dependent on public funds, it could not attract staff by offering salaries and conditions so widely different from those in the Civil Service as to appear almost to amount to bribery. I recognise that it has been suggested to-day that, by the payment of much higher salaries, we should merely be compensating employees for the far greater lack of security of tenure of employment, and that the offer of higher salaries would be an inducement to people to join the organisation.

As to the likelihood of improving recruitment of people of the types we desire, people from the top and from the middle scientific grades, people from the higher technological and engineering grades, as well as people qualified to fill vacancies on the staff lower down, I think this is very doubtful indeed. To suggest that you are likely to improve recruitment by offering such salaries and conditions as have been mentioned to-day with engagements subject to termination at any time, and contracts containing a break clause, seems to me to be a mistake. Much higher salaries, attractive though they might be in themselves, would not bring in men when they knew that the break clause might operate to bring about their dismissal at any time. In fact, I think that what has been suggested might easily operate in the other direction, and the result might well be that recruiting would be less satisfactory and we should not achieve what we all, from our dif ferent points of view, wish to see achieved in the build-up of the organisation.

I take it from what has been said to-day that the Opposition recognise many of these limitations. What they appear to have in mind is a corporation operating under statutory powers. I am confirmed in that by the view expressed by the noble Viscount, Lord Swinton, who said that if it were found necessary to have new legislation they would facilitate its passage. Such a corporation would certainly have to have statutory powers. Their case in that respect is based on these two broad arguments. First, that so long as the organisation is part of a Government Department responsible for its detailed actions to a Minister, who is in turn accountable to Parliament, there will not be the necessary speed on decisions of policy and freedom from day-to-day interference which are essential if the development of atomic energy is to proceed as fast as it could do and as it should do. The second argument is that so long as the project remains part of the Civil Service, such matters as recruitment of staff and remuneration of service will have to conform with normal Civil Service rules, and this makes it difficult to attract the man of exceptional qualifications who demands a high salary of some special concession to attract him from industry.

I will return to these matters later, but I think it would be well to put the other side of the balance sheet—that is, the arguments against a special organisation for this type of work. The principal argument is that a special organisation or corporation would be a purely spending body, operating on voted moneys and producing no revenue. This would distinguish it from the other public corporations which have been referred to by, I think, all the three speakers on the other side, and which are expected, taking one year with another, to meet expenses out of the revenue they earn. It seems to me that the Chancellor of the Exchequer and Parliament might well feel difficulty about giving to a body of this kind a large measure of freedom to spend large sums of public money. The noble Lord who moved the Motion cited the example of the Medical Research Council. That Council does great scientific work which we all appreciate, and I suppose no one has greater inner knowledge of that work than the nettle Viscount the Leader of the House, who has been associated with it for so large a number of years. But no one could compare an organisation of that kind, working on a basis of grants in aid of research, with the kind of project we have here for the development of atomic energy. So, generally, I say that while it is possible to have a special organisation to conduct research on grants paid out of public funds, the development of atomic energy involves not only research but very large undertakings of an industrial character.

I make no complaint of the fact that the noble Lord who moved the Motion made some jocular reference to things that were said in the debate yesterday by the noble Lord, Lord Silkin, and myself, among others. But I think that it is only right that we should look at the reverse side of what he was suggesting by his jocular references. He is in favour of a special organisation in this instance, but he and his colleagues on the other side of the House yesterday supported Lord Strabolgi when he called for a greater measure of pubic accountability and Parliamentary control in relation to nationalised industries. That side of the matter seems to have been overlooked altogether this afternoon.

To come to the second point with regard to a special organisation, legislation would be required to bring such a special organisation into existence, and the resultant change-over would inevitably cause much disturbance of the atomic energy project and would certainly set its progress back by some months at least. Thirdly—and the importance of this, I think, tends to be under-estimated—there is the doubt whether the staff now employed on the project would be prepared to be transferred to a special organisation outside the Civil Service. Whether scientists, technologists and engineers, as a whole, would prefer to work for a corporation or directly for the Government is a matter of opinion. No doubt some would prefer the more competitive atmosphere exiting outside the Civil Service, where individual contracts of service can be negotiated, and this in itself might attract a small number of additional recruits to the project. But many would certainly prefer to remain in the direct employ of the Government, particularly in view of the nature of the project, and would not seek or accept service with a special organisation of the kind which noble Lords opposite have advocated.

Nor must we forget that a project of this kind needs a considerable number of administrative and executive staff for such work as accountancy, the letting of contracts and the vast number of other administrative details, and I should very much doubt whether civil servants at present employed on atomic energy work would be prepared to go over to a special organisation and lose the security of tenure they now enjoy and the more attractive prospects that would be open to them in the Civil Service as a whole. Moreover, under present arrangements there are advantages to both sides of mutual transferability, and this would be lost if a special organisation were set up. Finally, there are advantages in associating the atomic energy project with the Ministry of Supply, because that Ministry, by the nature of their other work, are in a position to provide to the atomic energy project a great many common services in a skilled, experienced and economical way. This association does not in any way preclude a close degree of personal attention by the Prime Minister.

Such seem to me to be the pros and cons of the case for a special organisation such as noble Lords opposite have in mind. As the noble Lord, Lord Cherwell, knows, this whole question has been given careful consideration by the Government within the last year or so. We do not deny that there have been minor troubles and difficulties, particularly as regards staffing and recruiting, but I can assure your Lordships that there is no record of any action or, indeed, inaction by the Ministry of Supply which has impeded progress or development on any major issue. I do not know to which project the noble Lord referred when he said that after the date on which approval had been given on a scientific basis, it was three years before bricks began to appear above ground. I do not want necessarily to discuss this openly and I am quite prepared to have a talk with the noble Lord about it, but, so far as I know, in post-war circumstances the work would not have been done more quickly by a different organisation.

I challenge anyone to say that this project has not received top priority in re gard to labour and materials. That has been testified largely by the noble Lord, Lord Adams, in what he said in his letter about the atomic energy project in the north-west. On the instructions of the Prime Minister (and I notice the noble Lord wishes to have any special organisation set up under the direction of the Prime Minister) the atomic energy project has always enjoyed the highest priority. It is on the largest scale possible, having due regard to the availability of the fundamental raw materials, to our limited resources generally, and to our other inescapable commitments. There has been no delay in policy decisions, and each constructional project has been started immediately the design was sufficiently well advanced to enable building to commence. The project has never suffered from lack of money; nor, generally speaking, has it been unable to recruit its due share of the limited number of scientists and engineers in the country. The work has not proceeded in a departmental ivory tower. Research development contracts have been placed with universities, and with industry as widely as possible, although, naturally, much of the work is neither technically attractive nor financially remunerative to industry, which is already fully committed in other directions.

Every effort has been made, and I think with the greatest success, to make the present organisation as flexible as possible, and to give those responsible for the development of atomic energy a free rein to take such action as is necessary to achieve the objects which we all have in view. I have said that our minds are not closed on this matter, but we are not satisfied that a special organisation would have been any more effective than the present one. I am sure that the noble Lord, Lord Cherwell, will take it for granted that I looked into this matter as closely as I could from the moment I knew that I was to reply to the debate on this Resolution—although I should much have preferred to have my noble friend the Leader of the House present to reply himself. As the noble Lord will also know, my noble friend had not finished his inquiries into this question at the time he went into hospital. I have not so far come across any example of delay in decision, or in development or progress, which would have been in any way lessened by the existence of a special corporation in charge of the business. Such an organisation would have had to contend with every one of the same difficulties with which we have had to contend. We should need some convincing that, in the present stages of development of atomic energy, and in the present world situation, it would be in the public interest to make a change in the present organisation. We think that this is not the best moment to change horses in midstream. That would cause an upheaval which would inevitably check the progress which the organisation is making, and would lead to more delays. If concrete evidence were produced that the present arrangements were causing delay and inefficiency, or any conclusive evidence produced that an independent organisation under broad Government control would be more efficient, noble Lords may depend upon it that we would give it every possible consideration. In view of what I have said, I think the onus of proof (if the noble Lord, Lord Cherwell, will forgive nay putting it in this way) is upon him to show that a special organisation can do the job better. We have heard only talk about general principles and what might be done. Until a case is made for a change of organisation in that direction, we feel that it is wisest to adhere to the existing arrangements.

There is one other point of substance which has been raised in this debate, particularly by the noble Viscount, Lord Swinton, on which I should like to say a few words—namely, the question of security. As the noble Viscount knows, security has been a matter of much concern to me during my years of office, both at the Admiralty and as Minister of Defence. No one who thinks anything of the interests of his country could complain if stiff measures, even drastic measures, had to he taken to make security in vital matters really operate. When it is suggested that the experience of special or semi-Government corporations in maters requiring special security is more efficient in that direction, I should find it difficult to prove that.

The noble Earl, Lord Halifax, has referred to the matter this afternoon. He says that the Americans might be particularly anxious and tender upon such points, and I can well understand that. But I do not know how many of your Lordships have, like myself, read from beginning to end the Report of the Royal Commission in Canada in 1946 on the breaches of security, which were by no means confined to Canadian subjects but were widespread into the American organisation. That would hardly seem to show that this special organisation in charge of atomic energy development in the United States has been any more successful than the other methods of security and maintenance which have been employed from time to time. I should not like it to be thought that there was any special virtue on the security side in that direction. The noble Viscount, Lord Swinton, was a Service Minister for some time, and he will know that, when it comes to looking after security in a Service Ministry, there are great differences between what can be done in the actual Service sphere and in the outside industrial sphere. It is by no means in the outside industrial sphere that the easiest task lies.

VISCOUNT SWINTON

I was not proposing an outside industrial sphere. What I was proposing was a special organisation, responsible to the Prime Minister, and able to impose security conditions which the Civil Service cannot impose. I say without hesitation that that would give a much greater security than we have to-day, and a security which we need.

VISCOUNT ALEXANDER OF HILLSBOROUGH

These matters are of vital interest, and I always think that we can all have opinions about them, based upon our experience. Certainly, in dealing with matters of security, I have found that activities in a sphere which is generally regarded as being outside the Civil Service have been by no means the easiest part of my task. If there were set up a special organisation, of the kind visualised by the noble Viscount, engaged very largely in outside industrial activity, I cannot see, apart from the general power to sack individuals, that it would provide any greater method of security than the Civil Service Las.

Reference has been made from time to time to the urgency of this matter, and the reason the debate has been pressed forward by the noble Lord in the absence of my noble Leader is the impending retirement of Lord Portal from his position of Controller, and the impending retirement of Mr. Perrin, the very able and well-informed deputy who has been acting under him. I would say at once that it would be quite wrong not to pay the highest tribute to both these public servants. Lord Portal has rendered very great assistance indeed, and we very much appreciate his services. He undertook this work under some pressure. As we know, from 1946 onwards he would have liked a little more freedom than has been possible. But he took the job for three years, and, having gone on with it for well over five years, it is not surprising that he would like the opportunity now to retire.

LORD CHERWELL

Before the noble Viscount leaves that point, I take it that he is not suggesting that Lord Portal is content with the present set-up, and has not asked to have the project taken out of the Ministry on the lines I have suggested.

VISCOUNT ALEXANDER OF HILLSBOROUGH

I refrain from making reference to Lord Portal's opinions. What I am saying is that we owe him a great debt for his services, and we can well understand that, after having outstayed his first intentions of taking the position for three years, he would now like to retire.

LORD CHERWELL

But I take it that the noble Viscount does not deny that Lord Portal has put forward to the Ministry a similar project to the one I have put forward?

VISCOUNT ALEXANDER OF HILLS-BOROUGH

It is not for me to Confirm or deny that kind of matter, which is produced to the Minister of Supply and the Prime Minister. I have made no reference here to Lord Portal's views, and I am sure the noble Lord does not think that I am in any way misinterpreting him. On the other point, there is no doubt at all of the greatness of Mr. Perrin's service, or of his ability and knowledge. We are sorry to be losing him. But to suggest that his retirement is the kind of overwhelming disaster that has been mentioned this afternoon would, perhaps, be making rather too much of it. My information is that there will be no difficulty in securing from our other resources the necessary person with the ability to carry on that particular job.

I would say to noble Lords opposite that we in the Government are most anxious that this work should continue completely upon non-Party lines, because the development of atomic energy is so vital to all our interests. I say again today—and I say it particularly bemuse my noble Leader is still absent—that we have not closed minds. I shall, of course, see that every one of the speeches and arguments which have been raised by the three noble Lords who have addressed us from the opposite side is brought to the attention of the Prime Minister and the Minister of Supply, and that all the points which they have raised are duly considered. But until further evidence than we have yet had is adduced, we feel, as at present advised, that it would be a mistake to make a change. We will give the matter further consideration if any specific and special evidence is brought to our notice.

5.18 p.m.

LORD CHERWELL

My Lords, I am, of course, most grateful for the full reply given by the noble Viscount, the Chancellor of the Duchy. I cannot help admiring the noble Viscount's bulldog tenacity which prevents him from surrendering to evidence, however overwhelming. He said that one of the reasons why we had been slow in producing atomic weapons was our postwar reconstruction problems. Had Russia no post-war reconstruction problems? If Russia could get her bombs going in two or three years, why has it taken us so long? The noble Viscount also said that Russian labour conditions are much worse. We have never been short of labour; it is not the inability to get labour that has held up progress. Surely, the noble Viscount does not pretend that slave labour is more efficient than free labour.

VISCOUNT ALEXANDER OF HILLSBOROUGH

I think I ought to make clear what I meant. What I meant was that we do know about the conditions of impressed and slave labour in Russia which was used in the major developments; it is to the use of that labour that I attribute the speed with which some of these things were developed.

LORD CHERWELL

The noble Viscount apparently holds that slave labour is more efficient than free labour; I should be very surprised if that were true. Even so, it should not make all that difference. The noble Viscount said that, considering the arrangements, we have made much progress. That is true. It is the arrangements about which I complain. If there had been other arrangements, I think we should have made a good deal more progress. The noble Viscount said that atomic energy had always had top priority. I agree. I said that the Prime Minister had always supported this project, and had given it high priority. In spite of that, the fact remains that we started ahead of Russia, but we are now at least a lap behind; and I cannot agree that that is a satisfactory state of affairs. Then the noble Viscount said that the Government were not convinced that the other method would be better, and that the onus of proof that an alternative organisation would have moved more quickly was upon us. But, surely, the only way of proving a thing is to try it. Apart from that, the only thing you can go by is the argument and judgment of those in a position to know the facts of the situation, and in that the technical opinion is overwhelmingly on our side. That, surely, is supported by the fact that every other country is working somewhat on the lines that I have suggested.

The noble Viscount went on to say that the other organisation would have had the same frustration, even if it had been independent. I do not know. It seems to me that some of the other organisations are masters in their own house. I do not think the Food Corporation, for instance, had to obtain Treasury approval for every one of its forms of expenditure. The noble Viscount said that many people would prefer to be in the Civil Service rather than to be in free enterprise. Some would; but on the whole, among scientific and engineering people who are prepared to back themselves to make a success of their job, it is not the best ones who want a Government job from which they can never be sacked.

The noble Viscount then said that yesterday people were arguing for more Parliamentary control over Corporations. But the atomic energy project is in the hands of the Ministry. If it went out of the hands of the Ministry it would not mean more Parliamentary control, but less. At any rate, it would not hamper the organisation at all. The noble Viscount said that we should have to account for all the money. I do not know whether he remembers that only a few weeks ago I asked for an explanation as to what the heading "Other," over a figure of £315,000,000 given in the Government accounts, stood for; and the Government refused to say. If they can get away with concealing £315,000,000, I think they could do the same in this instance without giving a detailed account as to how they spent the relatively small amount of money on the Atomic Energy Corporation.

THE FIRST LORD OF THE ADMIRALTY (LORD PAKENHAM)

My Lords, I do not wish to intervene at this late hour, but the noble Lord knows perfectly well that that £315,000,000 was a completely different item. It was not an item of Government expenditure.

LORD CHERWELL

It was an item in the Government accounts. If they can get away with that sort of thing, I do not believe they would have much trouble in explaining away this particular sum. The noble Viscount then said: "This is the wrong moment. You must not swap horses while crossing the stream." That, of course, is the standard excuse of the drunkard for stopping tippling at any given time. We made that argument several times when talking about the transfer to the Government Corporation of the manufacture of iron and steel, and it was brushed aside as absolutely of no moment. But it is the same argument. At that time the Government did not seem to consider that there was any difficulty about swapping horses while crossing the stream, and I do not think they can very well bring that argument forward here.

I will not go into the question of security. My noble friend Lord Swinton, who has more experience with regard to that matter than anyone else, has already dealt with it. Nor will I go any further into the question of motives, or the reasons why the two principal people in the project have resigned. All I was concerned about, when I interrupted the noble Viscount, was that no impression should be created that Lord Portal was in favour of the existing arrangement. When it was stated that he had continued his appointment over the three years, I feared that that impression might be wrongly given currency. To sum up, I believe that the situation is unsatisfactory. I think the Government will find it very difficult to find a good replacement for the two pincipal men who have left. In my view it is most urgent that something should be done to encourage people to believe that

Resolved in the affirmative. and Resolution agreed to accordingly.