NAVAL DOCKYARDS

HL Deb 18 June 1952 vol 177 cc283-323

2.50 p.m.

LORD WINSTER rose to call attention to the organisation and administration of the naval dockyards; and to move for Papers. The noble Lord said: My Lords, I fully agree with the noble Lord who said to me that my Motion deals with a highly specialised subject, but I make no apology on that account for introducing it. The naval dockyards are a factor of the very first importance in regard to the defence plans which we are formulating. They involve very large numbers indeed of workmen, and they also spend many millions of public money. They form a subject which rarely receives due attention in the Navy Estimates; because, of course, in the debates on those Estimates such a wide variety of subjects has to be dealt with; but in my humble opinion naval dockyards merit a debate in themselves. As regards inquiries which have taken place about them in the past, there was the Hilton Committee which investigated the yards in 1927 and which issued two Reports, a Majority and a Minority Report which were not published. The Secretary of the Admiralty, in his evidence to a recent Select Committee, said: There has been no full-dress review of the principles of dockyard management since "— that is, since the Hilton Committee reported. The Select Committee heard evidence on the yards in 1940 and 1941, but again no Report was published. An Admiralty committee, inspired by the Minister of Labour, inquired into personnel matters in 1945; but again no findings were published. The latest Select Committee reported in July last year, and its Report is, I understand, still under consideration by the Admiralty. Of course, the Admiralty are bound constitutionally to make a reply to the Report of that Select Committee, and I can only hope that the long delay which has taken place in considering the Report is an indication that the Admiralty are taking the Report very seriously and are planning really sweeping alterations in the structure, management and organisation of the dockyards.

To deal with the question of labour first, the dockyards cannot do their work efficiently unless they have an ample supply of labour—and contented labour. The total force now employed, at home and abroad, is something like 100,000. This question of labour is all the more important because it is Admiralty policy to give the yards more work than they can do: they push more work on them than can be handled. Labour, therefore, has no fear of working itself out of a job, and I consider that to be a very favourable condition indeed. In spite of that fact, there are very considerable shortages of labour in the yards—and of important sections of labour. There is also the disturbing fact of an appalling wastage of apprentices, who drift away from the yards after going through the dockyard school. Between 1928 and 1942 7,000 apprentices entered the yards, but by 1948 only 39 per cent. remained. I should be grateful if some reason could be given this afternoon for this shortage of labour and this wastage of apprentices. What are the reasons? I notice, in that connection, that dockyards have nobody to advise managers on the recruitment and selection of personnel, and I wonder whether that has any bearing on the matter, because advice on those two points is of extreme importance where labour is concerned.

Mention of labour brings me to the important question of joint production committees. These committees were a war-time innovation which were revived under the late Government between 1945 and 1948. Their main object, of course, is consultation between both sides, management and men, with the object of increasing efficiency and production. The evidence given to the Select Committee on this subject was rather disquieting. Departmental managers are rather apt to be uninterested; the committees meet sporadically and the members attend rather irregularly. As a rule, an agenda seems to be non-existent or, if not that, at least very inadequate. The committees have been very disappointing. For instance, I can find no record of their having seriously tackled the important question of improved efficiency and production in order to make good the loss of three hours per week resulting from the reduction of the working week from 47 to 44 hours. The failure is very disappointing indeed. With regard to the yard managements I think it may be said that it shows them to be lagging behind industrial practice in utilising and encouraging the work of such committees. Industry outside the yards has found these committees of great value.

But running such joint consultative machinery is a highly specialised job, and the first requisite is that management must want it to succeed. The yards at present dispose of no competent expert advisers in such matters. The deputy managers who sit on these committees lack qualifying experience. It came out in the evidence of the Select Committee that no manager or deputy manager had ever attended a joint production committee outside the yard in order to get experience of how industry handles such matters. A trade union secretary gave evidence on the Devonport committee to the effect that the committee did not permit anything of a constructive nature, and the men feel that they cannot get at the real issues through the committee. But what I found particularly disquieting was that the Secretary of the Admiralty on this subject used these words: I do not think the production committees as they existed during the war were worth having, and I was not sorry to see them disappear. Well, my Lords, if that is the attitude at the top about the production committees I do not think we can be very surprised that they have indeed proved a disappointment.

The Select Committee found that the joint production committee at Rosyth had not met for nine months. Having read the evidence—in fact I have read every word of this voluminous Report of the Select Committee—the evidence given on the situation at Rosyth seemed to me to be vague, if not indeed apathetic. But certainly their committee were not considered to have fulfilled their function of increasing production. As I read the Report, the joint production committee at Devonport had not met between June, 1949, and June, 1951. To my amazement the Admiral Superintendent there found this a matter for congratulation. The trade union representative used these words: We are told that whatever discussion we have the prerogative lies with the official, whether he operates it or not. If you want production in a dockyard you have got to adopt similar methods to those in big industry where you get employers and employees acting together and producing something for the benefit of the nation. Some form of consultation on production must be maintained. But if the Admiralty cannot overhaul and mend the working of these committees let them be ended, and let them hand over the work they are supposed to do to the Whitley Committees. So much for the joint production committees.

Now for production itself. Production is, of course, wrapped up with the lay-out of the yards, and the plant and equipment. Defects and deficiencies in these directions result in uneconomic production and are largely due to the fact that the Fleet gets too large a share, and the yards too small a share, of the money which is voted for the Navy. Expenditure on capital equipment rests upon a completely uncertain basis, and consequently there may be a slow running down in efficiency which does not automatically come to notice. This may go on for quite a long time before the Fleet becomes aware of the disparity between its needs and the yards resources. Incidentally, an Admiral Superintendent inexperienced in industrial production is less likely to notice this creeping process than an experienced professional man would be. I am told that the Vote for replacement of yard equipment is regarded as more susceptible to cutting than any of the other Votes, and that perhaps from 4 per cent. to 25 per cent. only of the demands received from the dockyards are approved. At Devonport, they said that they got one-tenth of what they asked for, and that if some sudden emergency or urgent need arises for some new or special machine, that machine, as a rule, can be obtained to meet that special need only if an item in the approved estimate is surrendered in return. I cannot think of a more inefficient way of handling the problem of equipment than that.

It is clear beyond all possible doubt that the departments could be run more economically and effectively if they had more, and more modern, labour-saving machinery. The head of the Engineering Department at Portsmouth, an engineer officer, said: "You could certainly cut costs," given the modern tools asked for. I think that this year the yards collectively asked for £902,000 worth of machine tools, and so on. They got £78,000 worth between them. I think this crude and clumsy system militates against economy, increases maintenance costs and runs to the accompaniment of very serious delays. In one instance in 1948, the Admiralty got round to approving a machine which had been demanded in 1946, and the yard finally got it in 1951. That is not the way to run a dockyard. The head of the engineering department at Devonport said: If we could replace all our obsolete plant in five years we should increase production probably by 50 per cent. I make that statement categorically. But how can managers of departments make their plans to fulfil the demands they anticipate from the Fleet when no balance exists between the programme of work to be done and the tools necessary to do it?

So much for machines, plant and equipment. Now for the lay-out of the yards. The current 1952–53 Estimates provide nothing for new works, although they provide £472,000 for continuation works. It is no wonder that the Admiral Superintendent at Devonport said: The dockyard is in a very had state.… Give us the money to build some decent shops for the men to work in.… The position is frightful. It is amazing how the people turn out the work they do. The secretary of the trade union side of the yard said: No department has got enough space. Modernisation and maintaining a high standard of production is practically impossible. Many of the workshops are obsolete. Many of them are unheated, and in winter the temperature drops below freezing point. I hope the Board of Admiralty never have to work in rooms where the temperature is below freezing point, but the men in some of the shops at Devonport have to do so. Even an Admiralty witness admitted that the yards were starved of money. To take a particular but most important case, electrical, radio and radar equipment has, of course, multiplied apace in the Fleet, but the necessity for a parallel increase in the electrical departments of the yards appears to have been overlooked. The existing electrical shops are badly laid out, badly equipped and badly overcrowded. They show no balance with Fleet requirements. And yet I believe there is no provision whatever for new electrical works this year. Broadly speaking, there is no proper plant maintenance policy in regard to the dockyards. The best an Admiralty witness could say was that the yards are reasonably modernised and he went on to say that if they require a replacement for an inefficient machine they may not get it the first year, or even the second, but they will ultimately get it.

The crux of these matters is the system of management, and that is where reform or reorganisation seems to be specially needed. Responsibility for the yards under the Admiralty is the affair of the Director of Dockyards. Each yard has an Admiral Superintendent who acts as general manager, and a yard has about nine different departments. By Admiralty wish, the Director of Dockyards is a Flag Officer. A naval engineer officer is not regarded as eligible. No civilian has held the appointment of Director of Dockyards since before the First World War, and we may take it now that no civilian or naval engineer officer with professional qualifications is regarded as eligible for the post. This must be very discouraging indeed for those who spend their lives in yard management.

The Director of Dockyards is responsible for spending perhaps as much as £32,000,000 a year and for employing an enormous labour force. Yet he has no previous experience qualifying him to direct such a huge industrial machine. I think there is force in the comment of those who say that the business turns over only because the Deputy Director, who gets an inadequate status and recognition, is an experienced professional man. But, as things are, men who spend their whole working lives or careers in yard management see the top post going to a naval officer who has no professional experience such as they have. As a witness before the Committee said: There is a stage at which promotion finishes for civilians in the dockyards.

Now let us take the Admiral Superintendent. Again, so far as I know, no naval engineer officer has ever held that appointment. The Admiral Superintendent—I say it with all respect, in no derogatory way—is an officer whom the Admiralty do not think can be further usefully employed at sea. It is a final appointment, which is held perhaps for three to four years, and the Admiral Superintendent may have a labour force of 14,000 men to run. The Admiralty informed the Select Committee that they consider that the administrative experience acquired by an admiral fully qualifies him to superintend the professional departments and decide correctly between conflicting technical advisers. They then seem to me to express a completely contrary opinion, for they say that his ability to deal with ships and officers in port outweighs his lack of industrial experience. So at one moment they are saying that he has the experience necessary to conduct the industry, while in the next they are saying that something which has nothing whatever to do with the industry is what really qualifies him for the post. I have read the qualifications which are considered necessary for the post; they are to be found on page 16 of the Select Committee's Report. I make bold to say that no outside commercial enterprise would ever dream of hiring a man on the qualifications which are given by the Admiralty as necessary for the post of Admiral Superintendent.

Estimates of the time it takes for an Admiral Superintendent to pick up this completely novel work vary from six months to two years. One Admiral Superintendent said, "For the first six months I was feeling my feet. After two years I was in a position to start shaping policy a bit." It is an excuse given for the appointment of an Admiral to this post that he acts as deputy to the Commander-in-Chief. It is estimated that those duties occupy 25 per cent. of his time. Taking this with the low estimate of six months to pick up his job, in a four-year appointment it follows that the yard gets two years and six months of the Admiral Superintendent's time, the other year and six months being spent in learning the job or performing other duties. I wonder whether Vickers would like to try to run their business on a part-time basis such as that. That long period of settling in must be bad for the morale of the yard, and must react adversely upon its efficiency. On those grounds alone I consider that the system stands condemned, and in fact it is only the technical ability and loyalty to their work of the managers and deputy managers that keep the yards running.

The Admiralty have come down on the side of an appointment for an Admiral, as against the need for a man with industrial experience. If this Admiral Superintendent is indeed indispensable, I am astonished to find that he has authority to spend only £1,000 a year "off his own bat." My Lords, if that appointment is not to be terminated, at any rate let there be a general manager appointed from amongst the managers inside the yard, not from outside. Let there he a general manager appointed to work nominally under the Admiral Superintendent. I believe that not only would that result in an improvement in the efficiency of the yards, but that it would open up a very much needed incentive to those in the dockyards.

I do not wish to say very much about the heads of the departments. I would observe, however, that each of the four main departments in the yard employs more men than does an average-sized works. In fact, the constructive department in a dockyard compares with the sixty largest factories in the country, and the heads of departments should therefore be first-rate men. Of the four departments I have mentioned, the captain of the dockyard, a naval officer, is again appointed without any reference to the needs of the yard work. The head of the constructive department, however, is appointed from the Royal Corps of Naval Constructors, and has a career training ashore and afloat. Yet for thirty years such a man has never risen higher than Deputy Director of Dockyards, although in one part of this Report the Admiralty say: Our view is that there is nothing quite so stultifying as making it clear to an individual that there is no promotion open to him. My Lords, I wish the Admiralty would act upon their own opinion, and offer to such men some form of promotion to the very top. The engineering department is run by naval officers of the engineering branch, with complete success. But the electrical department, which used to be run by civilians, many of whom had entered from the dockyard apprentice schools, is now to be taken over by naval officers, to the exclusion of civilian electrical engineers. That will be a great setback for them, and no doubt in due time will open up another appointment for another Flag Officer. So that of those four all-important departments, two are now, and three will be, headed by naval officers without industrial experience.

What had the Hilton Committee of 1927 to say about this set-up. The Majority Report advocated sweeping changes in dockyard organisation. It considered that the appointments of Directors of Dockyards and Admiral Superintendents were for too short a period to permit of a continuous and progressive policy. It considered that naval officers were unsuitable for yard appointments, and recommended that the Director of Dockyards and the Admiral Superintendent should be replaced by experienced civilians. Your Lordships may or may not be surprised to hear that the Admiralty rejected the Majority Report of the Hilton Committee, and adopted the Minority Report which, curiously enough advocated the maintenance of the status quo. The Report of the recent Select Committee very largely follows the lines of the Majority Report, and we must see whether the Admiralty continue to fight a rearguard action in these matters, or whether they give a little ground. May I suggest that those who are examining the Report at this moment would do well to examine the structure of management in the Royal Ordnance factories? I think that, quite possibly, very valuable lessons are to be learned in that direction.

The top management of naval dockyards certainly requires strengthening and welding into a harmonious team of experienced men working on long appointments of at least seven years, who have before them a career open to the talents, with the very top posts being open to them if they show themselves worthy. But if naval officers are to continue to be put in charge of these departments and to hold these posts, then let them be given an opportunity to transfer to the dockyard service and be trained for their work, and then stay longer in their appointments. If that is too revolutionary a proposal, at any rate let them be given some training for their work. When the Secretary of the Admiralty was interrogated on that point and asked whether a suggestion had not been made to that effect he replied: We have done nothing at all to consider whether there would be an advantage in a system of that kind. Everything is for the best in the best of all Admiralties!

Then there is the personnel adviser, again in modern industrial technique of management a most necessary official. There is a personnel adviser to the Director of Dockyards. He again is an engineering naval officer, with no training in industrial management, although, of course, the job requires very special experience. I feel that the job is not regarded as important and that the post is largely a waste of money. Again, the members of the Admiralty labour branch, which is concerned with the joint consultative machinery and Whitley Councils, have had no training in personnel management. A witness, when asked how the labour branch keeps abreast of modern ideas, replied, "By reading literature on the subject." Well, the proposal for a trained, experienced personnel officer in each yard has been rejected. I understand there is not one in Malta where there has recently been a little trouble which perhaps a well-trained personnel officer would have avoided. There are welfare officers in some yards, and the welfare officer at Rosyth said: I feel that during the past two years I have not really done anything at all. Evidence from Portsmouth was: I think conditions are exactly the same as they were thirty or forty years ago.

My Lords, private enterprise fully recognises the importance of personnel management. The Admiralty's labour branch should now be reorganised. It should advise the Director of Dockyards on personnel matters and control in each yard a personnel officer who should be specially concerned with joint consultation, which now lags so badly. Industrial experience shows that good results would follow from a step of that nature. I will not enter at length—I fear I am detaining your Lordships too long—into the question of the Merit Award Scheme. There is no one man in a yard responsible for administering and directing the scheme, with the result that the scheme —which I think is an excellent one—only stirs up suspicion and dissatisfaction. The Committee say: There has not been enough awareness among the managers of the revolutionary nature of the scheme. A witness before the Committee said: I can give you the general impression. The Merit Scheme is lousy. My Lords, the Merit Scheme is not lousy; it is a good scheme, but it has never been properly handled, for lack of the right man to do so.

I have only one concluding point to make about the organisation and administration of our yards and that is a short one which has reference to piece work and payment by results. These systems seem to be employed much more freely in private yards than in the naval yards, and I think there is force in the recommendation that it would be advisable to consult with the trade union leaders and with private firms as to the possibility of extending the practice. But one thing seems certain, and that is that un-ecomonic overtime is worked in the yards. The trade union side of the joint production committees at Chatham, in particular, complain on this point, and the reason seems to be that the Admiralty go slow for the first nine months in order to be quite sure that they are within their means. Then they pile on the work during the List quarter of the financial year, in order not to have to forfeit any savings to the Treasury. Surely this working of uneconomic overtime could be avoided by better planning of programmes and of expenditure. Another bad feature of this feverish end-of-the-year spending is that the money runs so short that incentive bonuses have occasionally to be dropped because there is not the money to pay them. Consequently, morale suffers and production drops. I know the objections about Supplementary Estimates. I am aware of the arguments on that score. But I still think it would be far better to ask for a Supplementary Estimate than to run short of money with such unfortunate results as I have described.

Let me sum up the remarks which I have ventured to make to your Lordships. I think what is wrong in the yards—and I am afraid there is plenty wrong—can in the main be traced back to the Admiralty, in the teeth of expert professional advice, always having come down on the side of appointments for admirals and naval officers as against men of professional experience. They deny the necessity—and what I have quoted this afternoon shows this—for such experience in running these great industrial concerns. They have accepted the Minority Report of the Hilton Committee that knowledge of Service matters and the needs of the Fleet are more important than knowledge of commercial and industrial management. The Select Committee say that: The Admiralty do not attach enough importance to the qualities required for managing large industrial concerns. The Admiralty systematically reject expert advice. In particular, they disregard industrial experience regarding personnel management. The existing system is riddled with obsolete procedures which are unfair to the nation, unfair to the Fleet and unfair to the workers in the yards. The structure of management is out of date and inefficient. There is no plant and equipment policy. Personnel management is neglected. Welfare only just barely exists. Joint production committees languish. Labour is short. Apprentices clear out of the yards. The yards themselves are behind the times. The shops are often over-crowded and unsuitable.

Each one of these statements is not made on my personal opinion; each one of them is supported by evidence given to the Select Committee, which the Admiralty witnesses were unable to rebut although, as the Chairman said to one Admiral Superintendent: You have trained your witnesses extraordinarily well. It is like trying to pierce the armour-plating of some of your ships. In spite of that admirable training, the Admiralty witnesses could not rebut the evidence which was given concerning these yards. The net result is that an Admiral Superintendent testifies that: The position is frightful. A Flag Officer of the highest and most distinguished attainments, knowing I was raising this subject in your Lordships' House, wrote to me to say that: The dockyards are past praying for. I can only hope that the long time which the Admiralty are taking to consider the result of the Select Committee's deliberations means that they are taking this subject to heart and that they do intend to reform the management, administration and organisation of the yards. If this Board of Admiralty do that, they will go down in naval history as a Board which have rendered a great service, indeed a service second to none, to the Fleet. I beg to move for Papers.

3.28 p.m.

VISCOUNT HALL

My Lords, my long association with the Admiralty entitles me to intervene in this debate for a short time. I should at the outset make my position clear. I am not speaking for the Admiralty. That responsibility falls to the noble Earl, Lord Birkenhead, and he, I am sure, will deal adequately with all the points and questions, which have been and which will be put to him. I can promise him that no troublesome questions will come from me. I think it has been a good thing to have this inquiry into the administration and production of the Royal Dockyards, conducted, as it has been, by the Select Committee on Estimates, who have devoted a great deal of their time to it. It can be said of them that they have probed very thoroughly into every aspect of dockyard production. They visited four large yards and also two shipbuilding yards and one ship-repairing yard. They have interviewed many members of the management and representatives of the work people and thereby obtained information of much interest, all of which has been collected and presented in this long Report, which I also have read from the first word to the last line.

I have listened with great interest to the statement which has been made by the noble Lord, Lord Winster. I am not going to question that in certain parts of the Report the facts which he has given have been brought out. At the same time, I ask noble Lords to withhold any opinion they may have until they hear the complete case. I am not going to suggest for a moment that everything in the dockyards is necessarily right, nor am I going to suggest that everything is wrong. As a matter of fact, the Report itself and its recommendations do not indicate that everything is wrong. If the general condition of the yards, or even part of the yards, were as suggested by the noble Lord, it would not have surprised me if a much more revolutionary series of recommendations had been proposed by the Committee.

The work which the dockyards have done during the last three years is the best proof of the efficiency of the yards. During the period since the commencement of the defence programme all the ships of the Reserve Fleet have been refitted once and a number of them have been refitted twice. The total number of ships which have had refits must be between 500 and 550. I am not suggesting that all the refits have been carried out in the Royal Dockyards. Some have been put into private yards. But, in addition to the refitting of the Reserve Fleet, the ships of the active Fleet have been kept in commission and a number of ships have been refitted for Commonwealth countries and some foreign countries. Also there have been, and there still are, large conversions of aircraft carriers, cruisers, destroyers and ships of all kinds. All this is an indication that the dockyards are meeting the demands which are placed upon them by the Fleet.

The dockyards are large industrial concerns. The home dockyards employ no fewer than 50,000 people. I am not going to suggest that there is no congestion in some of the shops, particularly in the electrical workshop at Devonport and some other shops, but it must be remembered that Devonport was severely bombed during the course of the war. Not only was some of the dockyard bombed, but some of the town was destroyed as well, and it has not been so much a question of getting money to make good the damage done during the war as a question of building labour and building materials. A considerable sum of money has been spent in the dockyards in the repair of buildings and on new buildings. Had the Admiralty had their wish, then a much larger sum of money would have been spent upon buildings in the dockyards, although during the last four years no less than £43,000,000 has been spent on buildings under Admiralty control. Another matter to which I should like to refer is the substantial increase in the number of workmen during the course of the last three years. The number has increased from 40,000 to just over 50,000—I am dealing with the home yards. In regard to congestion, it must be remembered that a large portion of the work of the dockyard men is not carried out in the workshops. I suppose about 60 per cent. of the work is carried out in the ships. There is no doubt in my mind that the work which they are doing has been efficient in every way.

On the machinery side, there is a great demand for new machines in every engineering shop in the country. There is a great scarcity and constant competition in securing necessary machinery, particularly machine tools. After studying this Report, I do not think that there has been much to complain about in the delivery of machinery during the last three years. If the noble Lord will look at paragraph 73 of the Report, he will see these figures. The estimated depreciation of machinery during the last three years was about £1,900,000. New machinery supplied to meet that estimated depreciation cost £1,500,000. But in addition to the new machinery which was purchased and delivered to the dockyards, something like £880,000 worth of machinery was taken out of stock—and that figure does not give its full value. I must admit that all of this machinery was not new and much of it had been used, but if we add, say, 50 per cent. to the value of that machinery, then we have met the whole of the estimated depreciation of machinery during the last three years.

The noble Lord, Lord Winster, dealt with the question of personnel officers. A Committee met in 1945 and inquired fully into the appointment of personnel officers in dockyards. That Committee recommended that it would be much better to appoint welfare officers rather than personnel officers. It is interesting that two of the three private shipbuilding and ship-repairing yards which were visited by the Committee had appointed welfare officers instead of personnel officers, and in the third the personnel officer frankly admitted that a large portion of his time was taken up in welfare work. As between the personnel officer or the welfare officer, the Admiralty, rightly or wrongly, have plumped for the welfare officer.

In the early months of last year, just before I left the Admiralty, I visited every Royal Dockyard, going through many of the workshops, talking to many of the workpeople, and later meeting representatives of the management and workpeople at meetings of the full works committee. The purpose of my visit was the question of increased production, and to solicit any complaints which might be made on either side on matters which were possibly holding up production. I was anxious to obtain an increase of something like 6½ per cent., which the Board of Admiralty were informed was lost as a result of the reduction in the working week from forty-seven to forty-four hours. I must say that I did not receive a single complaint, either from the management or the workpeople, as to anything likely to impede production. I had no complaint about congestion of buildings, with the exception of Chatham and Devonport; there was none at Portsmouth or Rosyth. Indeed, there was little complaint about the question of the state of machinery. The meetings which I attended appeared to be most harmonious and friendly, and both the management and workpeople expressed a strong desire to do what they could to give the production which was required under the defence programme.

The question of payment by results did arise—this point has already been put by the noble Lord, Lord Winster. There is a considerable amount of difference between the repair of a warship and the repair of a merchant ship. A warship is a cargo of scientific and technical material; it is not a specialist's dream but a specialist's workshop. This means that it is much more complicated and difficult to introduce any system of payment by results in the repair of a warship. Much has been done in respect of the question of job contract. One of the difficulties with which we were confronted was the question of the maximum payment, or the maximum earnings under this system of payment by results. I went out of my way, as indeed, the officials of the dockyard had done, to declare definitely that under this system of payment by results workmen could earn more than 33⅓ per cent. over and above their basic rates. There was a strong feeling that at no time could their total earnings go beyond 33⅓ per cent. over and above the basic rates. Still to-day we find that we cannot persuade the workmen in the yards that those earnings can be achieved. I found the morale and the desire to assist in every possible way as strong as I have seen it in any private shipbuilding yards which I visited, or indeed, in any industrial concerns.

I am not going to deal with the point raised by the noble Lord, Lord Winster, in relation to naval officers who occupy administrative posts. I am pleased to see that the noble Lord, Admiral of the Fleet Lord Chatfield, is to speak in the course of this debate. He has had a long and distinguished service, both at sea and at the Admiralty, and I shall be delighted to hear his views on the occupation of the higher executive posts by naval officers. With regard to labour relations in the Royal Dockyards, there is a complete system of consultation between the management and workpeople through a system of industrial committees, formed on the basis of the Whitley recommendations, and they have these committees at every stage. They have shop, departmental and yard committees fully representative of the management and workpeople at all levels. This work is co-ordinated through the Admiralty Industrial Council and the Shipbuilding Trades Joint Council, which is doing a very useful job. At the meetings of these Councils every possible question concerning dockyard matters can be raised and discussed, whether it concerns wages or labour matters, or anything likely to affect production. The Councils meet periodically—I think once every six weeks or two months, and I know that considerable importance is attached to their efforts. These Councils are working satisfactorily for both the management and the workpeople.

I believe that the test of the efficiency of an industry is the standard of its work, in quality, skill and material, its durability, and the cost. I do not think there is any question about the standard of the work carried out in the Royal Dockyards. The Select Committee of Estimates, after their very close inquiry, report that they are satisfied that the general level of work remains high, and that there are no instances of gross inefficiency to which they wish to call attention. That, in itself, is an indication that things are not nearly so bad as one would imagine after listening to the speech of the noble Lord, Lord Winster.

I have already referred to the highly specialised work required when carrying out warship repairs. For that reason there is little opportunity of comparing costs at private yards with those at the Royal Dockyards, for no two refits or conversions, even of two sister ships at the same time, are precisely alike. But a detailed comparison of costs has been made from time to time. In the rearmament period before the last war, attempts were made to place refits in private yards at contract prices comparable with the costs in the Royal Dockyards—but without success. This would mean, of course, detailed specifications, and some little delay. Even so, it was still impossible to place the refits at fixed prices, based upon Royal Dockyard prices. Very little work was done, and that only under a system of not fixing the prices.

During the war, when much repair work was carried out by contract under the terms of the efficiency repair agreement, comparisons were again made and seemed to be in favour of work done in the Royal Dockyards. In the last two years, in an attempt to overtake arrears of repair work on the Reserve Fleet, a large number of ships have been refitted by contract. Steps were taken to compare the costs of a number of these refits with those of broadly similar ships refitted in the Royal Dockyards. A fair comparison was found rather difficult but, nevertheless, the broad conclusion reached was that work in the Royal Dockyards was effected much more cheaply than in private yards. That is a test of the efficiency of the dockyards. Indeed, at the present time owing to the difficulties, it is impossible to get fixed prices either for repairs or for new construction in private yards. Something like 40 per cent. of the work in the Royal Dockyards is carried out under a system of payment by results.

One other test as to the economic value of the work carried out in the Royal Dockyards can be best judged by the repayment work. In 1947–48 we were slowing down naval expenditure, and we came to the conclusion that there was not sufficient naval work to keep the workmen employed in the Royal Dockyards. We then decided that for a certain period we would invite repayment work from other Government Departments and from commercial firms, and no fewer than 4,500 persons were employed on repayment work at competitive prices. The work was done, and great satisfaction was given to the consumers. We had to reduce the amount of work because of the defence programme, despite the fact that we had received offers of a considerable amount of commercial work to be carried out in the Royal Dockyards. Economically, it could be said that, compared with commercial prices, dockyard prices were on a competitive basis.

My knowledge of the Admiralty is that every effort has been and will be made to obtain the highest efficiency and to achieve economies in the Royal Dockyards. Detailed cost analyses for individual items are supplied by the Director of Expense Accounts to the Director of Dockyards. Comparisons are made between the four Royal Dockyards and between the various departments in each dockyard. The results of these investigations are sent to the Admirals-Superintendent to take action on inequalities which are revealed. Then there is a Comparative Costs Committee which meets periodically to review all direct and indirect expenditure. There remains, of course, the problem of productivity, and we are hoping that productivity will increase. I think it is a good thing that this inquiry has been undertaken. Its findings are now with the Admiralty and Her Majesty's Government, who will, I am sure, come to conclusions which will not in any way take from the Royal Dockyards or the Royal Navy any of that great tradition which they have built up, and which can be maintained only by efficient and loyal service to Her Majesty's ships.

3.55 p.m.

LORD CHATFIELD

My Lords, like the noble Viscount, Lord Hall, I should like to congratulate the noble Lord, Lord Winster, on moving this Motion, but I cannot congratulate him on his conclusions. I feel that if the noble Viscount, Lord Hall, had not given a more balanced view of the matter, your Lordships might have gained the impression that the Royal Dockyards were badly run, badly equipped, did bad work and were inadequate for their purpose. If you read from a Report the evidence of some individuals which you select out of a large number, you can make yourself believe anything and you can appear to prove anything. But if you really want to get a proper view of what the Select Committee thought, then you must read their own conclusions. As the noble Viscount, Lord Hall, has pointed out, those conclusions were not those of Lord Winster. I am sorry that I differ so much from the noble Lord with whom I have so often collaborated on naval matters, and I am sorry that he should have expressed such caustic judgment on the Admiralty, on sailors and on the dockyards. If I may, I should like to make a few remarks to help balance your Lordships' minds.

First let me say that the Royal Dockyards are a very special naval requirement. They are unique. There is no private establishment for repairing ships which in the nature of its work bears any relation to or comparison with the Royal Dockyards. In saying that, I do not refer to the vast range of work which comes under the administration of a dockyard superintendent—a naval dockyard is a manning and storing base for the Fleet, and a large number of naval establishments are connected with it. I refer to the main work of the dockyard—the repair and maintenance of the Fleet, and reconstruction and construction work. It is essential that the dockyards and their administration should be in the closest touch with the Fleet and the sailors. As the noble Viscount, Lord Hall, has said, ships to-day are highly specialised, and their repair and maintenance correspondingly so.

Let me give your Lordships an example of what I mean by that. To-day merchant ships as well as warships are equipped with radar. Now if radar is being put into a merchant ship, the set of instruments and the wiring are supplied by a private firm—Decca or Marconi. The ship goes to sea with that gear fitted in her and it is tested for adjustment and efficiency. Let us imagine that that ship comes back and, for some reason, her radar is ineffective. What happens? She goes to a repair yard and that set is landed. It goes back to the people who made it, they repair it and send it back to the ship, and it is re-fitted in her. What is the difference if a warship's radar goes wrong? The difference is this. The radar is taken out of the ship in the dockyard, it is repaired in the dockyard, and the dockyard repairers put it back in the ship, test it and see that it is efficient and such as to satisfy the officers who are going to use it. That is the main difference. The dockyard has not only to repair the ordinary things in a ship, but also to repair all the electrical installations, machinery and everything else that the ship has in her.

The noble Lord rather gave your Lordships the impression, I am afraid, that a naval officer is perfectly hopeless in a dockyard. It is rather like the conclusion that the Biles Committee came to twenty-five years ago, when I was Controller of the Navy. The Biles Committee said that all naval officers should be swept out of the dockyards and replaced by civilians. As that idea was totally incompatible with the views of the Admiralty, both civilian and naval, the Hilton Committee was set up, partly at my suggestion, in order to get a more balanced Committee to consider what should be done about the Admiral Superintendent and the management of the dockyards. As the noble Lord, Lord Winster, has told the House, the minority view prevailed over the Admiralty: they thought that it was the sounder one. It is very difficult to get into the civilian mind what the naval officer's qualities are—and one is naturally diffident about expressing them. But nearly all seamen are technicians, specially trained to look after their ship and repair the material of their ship.

When I was Controller, twenty-five years ago, we brought in a scheme which has lasted until to-day: that no ship should come back to the dockyard except to have her bottom cleaned and alterations or additions made to her. The result is a ship which has mended herself, with her officers and men keeping the whole of her delicate instruments in order for two years or more, without any help from anybody. The captain of the ship has to take charge of that work with the technical officers, naval, electrical and engineering, and he has to co-ordinate their work to see that they all get on with each other and that they produce what he wants them to produce as quickly as possible. Therefore, you have in a ship a small dockyard which is repairing one ship every day. To say that these officers, when they come on shore, are totally unfitted to go into a dockyard to try to administer and regulate its work, is absurd, because they are specially trained for that very purpose. That is why I am particularly concerned with paragraph 18 of the Report of the Select Committee which recommends that there shall be a general manager in each dockyard.

The question of the management of the dockyards has been a very controversial point for many years. When the Hilton Committee recommended that there should be an outside civilian manager to control a dockyard, I sent for the leading shipbuilders of this country, three of them, whose names I will not mention. They were the chairmen of the three largest shipbuilding concerns in the world. I asked their views and they answered by saying that it was ridiculous to imagine that anyone could be found in industry as a whole to fill the post of general manager of a dockyard. That was their view, and I should say that it would be very much the same to-day.

But, although it may be necessary to have a controlling officer in a dockyard, I believe that the Admiralty have at the present time started making the manager of the construction department the co-ordinator of the time programme of a ship under repair, to see that there are no bottlenecks and that one department does not lag behind another. He is the general controlling officer, as I understand it, between the various technical departments in the dockyards. That may be all to the good. Nevertheless, it would be a great mistake to do anything that would push the Admiral Superintendent—though not, perhaps, putting him out of the dockyard, as my noble friend would like—too much in the background, thus giving a set-up something like that of an ordinary company where there is a general manager, the Admiral Superintendent, being comparable with the chairman of the board of directors. For many reasons, that would be a great mistake in a dockyard—at any rate, so I suggest, from my considerable experience, though I admit that I am now old and out of date.

The effect of close understanding between the various technical officers in the yard, and between the yard and the Fleet they work for, entirely overrides the detailed business of management itself, important as that is. You can do nothing in harmony in a dockyard unless there is harmony between the officers and principal technicians in the dockyard and those very strong-minded people who come in with their battleship or destroyer to be repaired. Harmony, as the late First Lord has justly and fairly indicated, exists in the dockyards. In my opinion, there have been many defects in the dockyards; there always have been and there always will be. But the harmony in the dockyards is largely due to the Admirals Superintendent and their ability to hold an independent and fair balance between the many different strong-minded technicians of different trades, and between the claims of the technical departments and the ship which comes in to be refitted.

When a ship comes in for repair the Admiral Superintendent, in his conferences with the captain of the ship and with the technical officers and the dockyard officers, must have some understanding of the ship's point of view. This cannot be achieved by a civilian manager who has never been to sea. If the Admiral Superintendent is to balance opposite views he must have a tactful and understanding grasp of the problem as a whole. The question may arise, for instance, as to how far the technical staff of a ship should co-operate with the staff of the dockyard. That can be settled only by arrangement between the Admiral Superintendent and the captain of the ship, never between the technicians themselves.

There is one question about piecework which was raised by the noble Lord, Lord Winster, and referred to by the noble Viscount, Lord Hall. It may interest your Lordships to know, in view of the alleged inefficiency of our dockyards, that in 1926 Admiral Barttelot, who was Director of Dockyards at the Admiralty, started in the dockyard the idea of payment by results. It was exceedingly difficult at that time to get the trade unions to agree to it. They were afraid of payment by results, but the harmony between the dockyards and the trade unions concerned was so good that the trade unions gradually gave way, and we introduced payment by results. It is not easy always to carry out an extension of payment by results in a dockyard, as Lord Hall said.

Let me give your Lordships an example. Suppose that you have a small compartment in a ship which has been damaged and needs repairing. You can get a squad of men (or a gang of men, if you prefer the term) together and say to them: "Now, what will it cost? How long will it take? How many men will you require?" The head of the gang will say: "We can do that in a fortnight, sir, and it will cost £40." That is all right, provided that it is a perfectly simple job, like repairing a tank. But it is not so in a warship. There you have a vast amount of wiring in the compartment, and probably several instruments and other things which cannot be touched by the constructive shipwright gang. The electrical gang have to go in and give their estimate as to what their job contract would be for taking down the electrical work and putting it back again when the shipwrights had finished. When the shipwright gang hear that they are not to do this work they say: "We could do the whole thing ourselves, and if we are not to do this part of the job we will not do it at all." So the job contract fails and the work has to be done by time and line instead.

I am glad that the noble Viscount, Lord Hall, was able to speak about the cheapness of dockyard repair work. After all, it is a test. If they can do their work cheaply and well, it cannot be said that the dockyards are rotten and their appliances useless. As I know, it is a fact that the dockyards, when they have repaired merchant ships, have done it despite there being no profit made. But even making allowances for the fact that there is no profit to be made, as there is in a private yard, the Royal Dockyard repair work is the cheapest there is, and the owners of private mercantile ships under repair always show the greatest appreciation of the skill, efficiency, rapidity and courtesy which they receive from the officers of the Royal Dockyards.

There always ought to be, I would suggest, a reasonable amount of new construction given to the dockyards. The great difficulty of repair work is that it is rather soulless work. You make an estimate, but if it is low and you find later that you cannot complete the work within the estimate, you are blamed; if you make an expensive estimate, you are blamed for making it so high. If you have new construction, or reconstruction on a substantial scale, it is essential to set a standard of competition with private yards. You can say to the dockyard: "You have got to build this ship for less than some other firm outside; and, if that can be done, you will get the credit for it." That puts the men on their mettle. If you can get one corner of the dockyard on its mettle, the standard of work is correspondingly raised.

It is difficult to get new construction to-day because there is so little of it. Reconstruction is going on, but you cannot compare reconstruction with private work because it is an unspecified job. Generally, I myself would say that you should handle the Royal Dockyards with great care. If a new experiment in administration is to be carried out, let it be done piecemeal. Do not suddenly start a change of a dangerous nature which might do away with much of the advantage we have in our present administration, and in the end fail to put anything comparable in its place. I hope that care will be taken, remembering that the friendly and efficient combination which exists now in the Royal Dockyards far exceeds anything achieved in many private yards.

4.16 p.m.

THE EARL OF BIRKENHEAD

My Lords, this is a very technical and difficult subject and quite clearly one in which brevity is not possible, but, while I was listening to the speech of the noble Lord, Lord Winster, I must confess that I felt as if I were wandering down the corridors of some old museum hung by the tattered arras of the past. But I will not disguise from your Lordships that I was somewhat shocked by the tenor of the noble Lord's speech. Apparently, he actually thinks that the Royal Dockyards have been run for years upon a vicious and incompetent principle. If that is his view, I can only say at the outset of my remarks that I must oppose it with an emphatic denial. He said that some officer had said that the dockyards were past praying for. I do not know who that officer was, but it certainly is not my experience of such dockyards as I have seen. Indeed, I must regard any imputations of that kind by the noble Lord as a dangerous reflection upon the distinguished naval officers who are in charge of our dockyards. I am encouraged in this belief by the two last speeches to which I have listened, both from very eminent men. They appear to me to contradict strongly what the noble Lord, Lord Winster, has been trying to tell us. I think that the noble Lord's attitude bears a certain relationship to Hitler's in his view about experts. When the German generals tried to deter Hitler from a course which he wished to take, he was angered and answered (as I conceive the noble Lord might have done): "I do not believe in these experts; they are imprisoned within the coils of their professional knowledge."

As noble Lords are by now aware, the organisation of the Royal Dockyards has been under review in another place and the Select Committee on Estimates have made recommendations covering many of the matters which have been raised to-day. My right honourable friend the First Lord of the Admiralty, who has been examining the recommendations of the Select Committee which have been frequently referred to in our debate this afternoon, is not yet in a position to reply to all the recommendations. Moreover, he has stated in another place that it would be improper to give information there orally before he has replied in writing to the Select Committee. Accordingly, in order to avoid in any way compromising my right honourable friend, I propose not to deal with any of the matters raised to-day on which replies have to be made to the Select Committee. I am afraid that there were quite a number, but I cannot help that. However, I assure the noble Lord, Lord Winster, that I will bring all his points to the notice of my right honourable friend so that he may take them into account when he frames his replies to the Select Committee. I am sure that noble Lords would not expect me to take any other course in these circumstances.

Before turning to the points which I feel at liberty to answer, I should like to make some general observations about the organisation and administration of the Royal Dockyards. In doing so, I am greatly fortified by the remarks which have just fallen from the noble and gallant Lord, Lord Chatfield, because it seems to me, though I admit I am certainly ignorant of the matter, that the critics of the Royal Dockyards, of which there are many, only too frequently have insufficient knowledge and appreciation of the true functions of the yards. Therefore, at the risk of being slightly tiresome to noble Lords who have first-hand knowledge, like the noble Viscount, Lord Hall, and the noble and gallant Lord, Lord Chatfield—I am particularly grateful to the noble Viscount, Lord Hall, for his lucid and interesting remarks—I propose to go a little further into this matter, a procedure which appears to me to be necessary in order to reach a complete understanding of our problems.

First and foremost, I must stress that the Royal Dockyards are an integral part of the Royal Navy's shore organisation. Apart from the refit, repair and maintenance work normally associated with a dockyard, the Royal Dockyards are also the Navy's organisation for the storing, victualling and fuelling of the Fleet. No other Navy, so far as I am aware, has a comparable organisation. From the standpoint of function and organisation, as Lord Chatfield has just told your Lordships, the Royal Dockyards are unique. Once that point is accepted, if it is, it will be appreciated that the only persons really competent to criticise dockyard management and organisation are the dockyard's naval customers. I cannot stress too strongly that the real purpose of the dockyards is the day-to-day maintenance of the Royal Navy. I must also stress the fact, because I think this point came into Lord Winster's speech, that the Royal Dockyards are very different indeed from private shipyards, as those of us who have had the privilege of visiting them are well aware. As well as being large repair yards they are also the home, the manning and the storing ports of the Fleet, so that at all times there are many vessels lying in various forms of commission in the yards, with large numbers of sailors manning them, all coming under the jurisdiction of the Admiral Superintendent.

The Admiral Superintendent has come in for some rather hard criticism to-day. I am quite unable to agree with the views expressed by the noble Lord in regard to Admirals Superintendent, and I hope that the reason why will emerge from my remarks in a moment. As the noble Lord knows, the Admiral Superintendent acts in a dual capacity. He is the representative of the Commander-in-Chief in dealing with all Fleet matters within the dockyard. He is the head of the dockyard and other civil establishments in port, for example, victualling yards, stores and armaments supply depôts. It is upon him that the responsibility lies to co-ordinate the requirements and the efforts of the various civil establishments, dockyard departments and officers commanding the various ships which are taken in hand in the dockyard; and he is deputy to the Commander-in-Chief in all matters. Clearly it is of the utmost importance to keep the dockyard in really close contact with all the activities of the Fleet within its precincts, and only an executive officer of very high standing is in a position to do this. Recently I myself had the privilege of visiting a Royal Dockyard, with the object of observing at first hand its function, organisation and administration, and so far as I am concerned. I cannot speak too highly of the abilities of the Admiral Superintendent of the particular dockyard I visited, which I am perfectly prepared to believe was typical of dockyard superintendents as a whole.

The organisation of the production side of a Royal Dockyard is on a departmental basis. Each department is managed by its professional head, and these departments have to be welded together into a co-ordinated, effective and happy whole. A professional officer or industrialist—which is, I think, what the noble Lord wants—would, in my humble opinion, be quite unable to deal with the naval side of the work. The indisputably high standard of co-operation that exists is certainly due to the unbiased leadership of superintendents who, with the advice of highly qualified professional officers under them, can hold the balance fairly between the requirements of the commanding officers of ships in hand and the dockyard officers and departments, all in the best interests of the Service. If the dockyards were administered by a professional officer or industrialist, I say that his inability to deal with the naval side of his duties would undoubtedly result in the dockyards tending to drift apart from the Fleet and become detached industrialist establishments. I cart assure noble Lords, and I beg to remind Lord Winster, that superintendents are specially selected for their ability to meet the demands of these unique appointments, as I think Lord Chatfield called them, which last longer than those of any other Flag Officer. In support of that remark, I may say that I saw the Admiral Superintendent in the dockyard which I visited talking to trade unionists from the Whitley Council. This discussion went on for nearly an hour and I had a good opportunity of assessing his relations with and his power over the men, and their feelings towards him. I was left in no doubt whatever that he was a very able and capable man indeed.

My Lords, I have referred to the principal functions of ship construction and repair, but of course there are many other diverse activities outside these functions. These include the supply and repair of the equipment of numerous shore establishments, which is sometimes forgotten, including the equipment in all the naval air stations, the manufacture and repair of stores, the repair of gunnery equipment and bulk storing of different kinds of stock. May I just present to your Lordships the following list, because I think it is very interesting: foundries, boat-houses, sail-making, joinery, the manufacture of oxygen, distilled water, flags, paint, smithery and coppersmiths' work, the operation of graving docks, floating docks, caissons, railways, water transport, steam water boats, tugs, cranes, laundries, and the maintenance of all their own equipment, machinery, buildings, telephones, boiler houses, docks and slipways. I think you will agree that that is a pretty impressive list.

The professional departments of the Royal Dockyards comprise the captain of the dockyards department and the constructive, engineering and electrical departments. I am not going into the details of all these officers' functions unless the noble Lord wishes me to do so, because it is a very complex subject and would take some time. But, with the noble Lord's permission, I should like to come to the question of industrial committees in the dockyards, a matter in regard to which I was personally very deeply impressed. As the noble Lord knows, these were founded on the basis of the Whitley recommendations. The dockyards have shop, department and yard committees, fully representative of the management and workmen at the suitable levels. That is the kind of thing which one is told: therefore I thought when I went down that I should like to see how it worked out. I was absolutely convinced that, in this particular dockyard at any rate, the relations between the two branches, the managerial and the other branch, were working perfectly.

The organisation which I have described is co-ordinated by the Admiralty through the Dockyard Department at headquarters, who are responsible for drawing up within the limits of the approved financial provision a planned programme of work and for its phasing and allocation to meet, as far as is possible, the requirements of the Fleet and provide a balanced sequence of work at the dockyards. They are guided by the advice of the superintendents and the principal officers of the dockyards. A planned programme of refits, modernisations, conversions and new construction is drawn up in the light of the Naval Staffs' forecast of the disposition of the ships of the Fleet and of their availability for refit. The programme is subsequently revised when necessary in the light of the finally approved financial provision which determines the amount of work that can be undertaken. So far as possible, the refits and dockings are planned to take place at the manning ports of the ships and, if possible, during the leave periods of the ships in the active Fleet. Adequate balance of work of the right type between the dockyards must always be an important factor in the distribution of work.

I think that at this point I might attempt to deal with the criticism of the noble Lord, Lord Winster, on the appointment of naval officers as Directors of Dockyards. For many years the appointment of the Director of Dockyards at the Admiralty has been filled by executive naval officers from the Flag Officers' list. From time to time, that arrangement has been criticised—as it has been to-day—and the Admiralty have examined the matter. The last comprehensive review that I know of was made in 1927–1928. The Select Committee on Estimates touched upon the subject in their Eighth Report but did not, I think, make any specific recommendation. The chief argument against the appointment of a naval officer to this post is that naval officers, however able they may be in their own profession, cannot be expected to possess the up-to-date knowledge of industrial and commercial management which is essential for the effective and economic control of the dockyards. I think that that is the noble Lord's view. The argument, of course, rests on the assumption—which I, personally, cannot accept—that the primary qualification of a Director of Dockyards should be a capacity to administer the manufacturing side of the dockyards.

A Royal Dockyard, in the view of the Admiralty, cannot be treated simply as a factory or manufacturing establishment turning out materials for private customers. No commercial shipping business does its own shipbuilding and ship-repair work. I have already stressed that a Royal Dockyard is essentially a naval repair base. It deals with a wide variety of technical materials of the greatest possible complexity, and the conditions of their use can be known only to those who have had wide sea experience. Such, at any rate, is my view. The Board of Admiralty rely upon the Director of Dockyards for advice on numerous matters requiring an intimate knowledge of the Service and of ships which a civilian, with the best will in the world, could never hope to possess. The noble Lord must surely agree with that. The understanding between the dockyards' administration and the Fleet would be much less close, in our view, if an outside civilian occupied the Director's post. The Admiralty view is, therefore, decisively in favour of the continuation of the present arrangement which, in their opinion, has stood the test of time. But they entirely agree that the success of the system does depend upon the careful selection of officers for their capabilities in the dockyard sphere rather than in a purely naval sphere.

To sum up, the primary purpose of the Royal Dockyards is, and must always be, the maintenance of the Fleet in an efficient state of repair and the servicing in the way of supplies and equipment of the ships based on the dockyard ports. In the light of the requirements of the Fleet to-day, we could utilise many more men than we now have in the dockyards if they could be recruited into the dockyard service and if the money were available to pay them.

Against that background, I should now like to deal with a few points which are outside the scope of the Select Committee's recommendations. The noble Lord, Lord Winster, has referred to the lay-out of the Royal Dockyards, their lack of modernity—I think he touched on that—and the lag in the dockyard reconstruction scheme. Undoubtedly, in the works field there is a great deal to be done. I do not collide with the noble Lord over that matter at all. Certainly, there is much to be done in renovating and improving the dockyards, and the policy of the Admiralty at the present moment is, generally speaking, to modernise and rehabilitate the Royal Dockyards and to make good war damage; to improve their lay-out and to remove to new sites outside, services which are not strictly necessary for the productivity and service of the yards. Unfortunately, it has not been possible to make any substantial provision for this purpose in Navy Estimates since the war. The Admiralty have had to accept investment and budgetary limitations upon their works expenditure. It is, indeed, a familiar story. We should all like, for example, to improve the roads of this country, but we cannot do so for exactly the same reason.

Accordingly, the emphasis of the Admiralty works programme has to be on the construction of works directly required for the support of naval operations. The reconstruction and modernisation of the dockyards, although clearly highly desirable and necessary—I entirely agree with the noble Lord there—must for the present, for that reason, take second place to the operational needs of the Navy, because it is essential in the present state of international relations that naval expenditure should be directed primarily to the state of readiness of the Fleet or, to put it in more picturesque language not unknown in another place, to sharpen the teeth rather than lengthen the tail of the Royal Navy. I cannot accept, therefore, the argument that the Admiralty are spending too much on the Fleet at the expense of the yards. I am glad to say that, despite these limitations, over £500,000 will be spent in the dockyards in the current financial year in progressing work on workshops, roads and railways, docks and other services in the Royal Dockyards.

As regards the plant and equipment of the Royal Dockyards, it is fair to say that they are very efficiently equipped with machine tools—in fact, probably more so than any private ship-repairing firm in this country. The equipment is abreast, or even ahead, of modern developments and techniques, and there is no question of production being hampered by antiquated machine tools. The position in the case of ancillary equipment and plant—for example, cranes, locomotives, caissons, shore boilers and so on—is not so good, and it must be admitted that the Admiralty incur heavy maintenance expenses on items which it might be more economical to replace, if sufficient funds were available. There is always a tendency to compare the Royal Dockyards with the large and progressive shipbuilding firms. The dockyards, however, approximate more closely to ship-repair yards, and if a comparison of equipment and plant is to be made, it should be with ship-repairing firms. On this basis even the ancillary equipment and plant, which is admittedly not all that we should like, bears very favourable comparison with that of the best firms in this country.

When criticising the yards, their layout and equipment, we should not forget the remarkable achievements of these yards in the last ten or twelve years. They have most successfully repaired vessels which have been very badly damaged by collision or by enemy action, both during and since the war, a fine example being the repair of the destroyer "Volage," whose bows were blown off in the Corfu Channel. Q-ship conversion was brilliantly executed and such magnificent jobs as the preparation of H.M.S. "Campbeltown," which was made into a mobile ram for the attack on the lock gates at St. Nazaire in 1942. Many block ships were prepared during the war with the utmost efficiency and secrecy, while in present times remarkable feats are being performed in the conversion of warships to meet the ever changing requirements of modern warfare. Possibly the biggest and most spectacular of the jobs being undertaken at present by the Royal Dockyards is the reconstruction of the fleet carrier "Victorious" at Portsmouth, which I saw with intense admiration. These establishments, which the noble Lord has severely, and with perfect right, criticised, made a great success of commercial work in the three years immediately after the war. Moreover, this was done at competitive prices.

The noble Lord, Lord Winster, also touched on the promotion prospects of managers in the dockyards. I have already explained that at present the managers of the constructive and electrical departments in the Royal Dockyards are civilians and the manager of the engineering department is a naval engineer officer of at least captain's rank. Under the scheme of navalisation, in the electrical engineering department the electrical engineering managers in the dockyards will become naval officers in the "L" Branch. The civilian managers in the dockyards are all eligible for advancement to the higher posts in the directorate of their particular departments in the Admiralty, these higher posts carrying substantial salaries.

While on the subject of personnel, I might turn to the noble Lord's references to shortage of shipwrights, naval constructors, electrical engineers and draughtsmen. The total number of shipwrights in the Royal Dockyards at home on March 31 last was 3,655 craftsmen and 872 apprentices. This total falls short of the Admiralty's current requirement by about 600, of whom the greater proportion are needed at Portsmouth. The unsatisfied demand is largely due to the fact that since the war the dockyards have again undertaken the major reconstruction of Her Majesty's ships, on which the requirement for shipwright labour is high in relation to the refits which were undertaken during the war. In an attempt to meet this urgent requirement, a dilution agreement was concluded by the Admiralty with the Ship Constructors and Shipwrights Association in respect of Portsmouth Dockyard in July, 1951, and a new agreement applicable to all the dockyards was concluded as recently as April last. At present about 180 dilutee shipwrights (if I may use that repulsive expression) are employed in the dockyards, 150 of them being at Portsmouth. But the recruitment of dilutees so far has done little more than counterbalance the normal wastage of craftsmen due to retirement and other reasons.

There is, not unnaturally, a shortage of naval constructors in relation to present large requirements. To some extent this is being met by the use of substitutes. This is not entirely satisfactory, but outside the Royal Corps and the shipbuilding industry very few qualified naval architects are available and the measures which the Admiralty have taken are, I think, the best that can be done. As to permanent recruitment, there is little that can be added to what I said in the debate on Navy Estimates on March 27, 1952. Although it is still too early to be definite, it looks as though this year's entry will be slightly better than last year's.

The shortage of electrical engineers, which has been mentioned several times, has resulted in the main from the pressure exerted by the rearmament programme. The rates of pay of the Admiralty electrical engineer have hitherto been superior to those of the electrical engineers in the general service. These rates are now under review, in consequence of the increases which were recently awarded to the general service electrical engineers on the recommendation of the Gardiner Committee. Increases will be granted, but the measure of the increases has still to be determined. No insuperable difficulty can be seen in meeting the Admiralty's permanent needs for fully qualified civilian electrical engineers.

I think the noble Lord would like me to say something about apprentices. As regards the apprentices position, apprentices are bound by deed to serve the Admiralty for a period of five years, during which they are taught all aspects of the trade they have selected. In order to obtain the large numbers required, the method of entry was changed in 1950. Instead of one entry a year, by competitive Civil Service written examination, there are three entries each year, either by written examination or by an aptitude test and interview. The new system is an interim measure pending the examination of other possibilities. During the training period, wastage is only about 1 per cent. per annum, of which about a half is clue to success at open Civil Service examinations for posts in other Government Departments. The remainder is attributable to unsuitability, domestic reasons, removals, and so on.

The majority of the apprentices complete their five years' training. They are then called up for National Service and a serious drain tends to occur at the end of this period. It is, however, only during the past twelve months that ex-apprentices who have been called up for National Service have begun to reach the end of their National Service. Complete data on whether or not they have returned to their dockyard employment is not yet available, but preliminary reports indicate that the number of young men coming back to their Admiralty service is, unfortunately, only a small proportion of those who were called up. Noble Lords will appreciate that the Admiralty has no power to compel these young men to return to its service on completion of military training.

There has been some discussion on the effects of cutting the working week by three hours. At this late hour I would much rather not attempt to trace the history of the events which led to acceptance of a five-day week in the Royal Dockyards as from January, 1947, and I intend to confine my remarks to the effects of that policy. The Admiralty have devoted much study to the effect on production in the Royal Dockyards of the reduction of the working week to a 44-hour, five-day week as compared with a 47-hour, five-and-a-half day week since the revised working week was adopted. My right honourable friend has, in fact, even examined the desirability of revising the arrangements of working hours. Any reform involving the reintroduction of Saturday working would, however, have to be made in conjunction with the engineering and shipbuilding industries as a whole, and that factor, together with a number of local practical difficulties, has so far militated against any change in the present arrangements.

The noble Lord, Lord Winster, raised the question of uneconomic overtime. The position is that overtime in the Royal Dockyards in the current financial year is severely restricted to work of urgent operational importance and to occasions when it is necessary to balance up major shortages in certain trades—for example, shipwrights. In the Royal Dockyards, as with any other similar concern, provision is made for a certain amount of permanent overtime which is inevitable, as, for example, for maintenance work and fire search during the silent hours. In the Royal Dockyards the cost works out at 3 per cent. of the wages bill. Provision made for other overtime has been fixed at 5 per cent., making a total of 8 per cent. I cannot accept the view that wage differentials in the Royal Dockyards are too small. The basic rates for labourers and craftsmen in Her Majesty's Dockyards are the same as those agreed in the engineering industry, and the differentials are, therefore, broadly the same. In fact, the merit pay scheme instituted about two years ago increased somewhat the existing differentials.

I have detained your Lordships at somewhat undue length, but I am afraid that this is such a vast and complex subject that I have done little more than scratch the surface. I am grateful to my noble friend Lord Winster for the admirable speech which he made at the beginning of the debate, and for the extremely temperate manner in which he introduced this rather controversial subject. I hope that I have at any rate said enough to indicate my own feelings about the matter. I am unwilling at this moment to allow a word of undue criticism about the administration of these vast establishments. The work which they perform is, in my view, most impressive. These results are being achieved the whole time by naval officers and civilians working together with the highest skill and integrity, and I am unable to agree with the noble Lord in the changes which he desires to see effected.

4.58 p.m.

LORD WINSTER

My Lords, I wish at once to thank the noble Earl for the completeness of his reply, and for the great courtesy with which he has answered various points which I raised in my speech. He has given a great deal of information which will be of extreme value to those who, with the best will in the world, are interesting themselves in this question of the Royal Dockyards and endeavouring to study ways and means of improving the already excellent work done there. In that connection, I may say that if the noble Earl (I am loth to inflict the task upon him, since he has had to listen to me to-day) reads my remarks when they appear in Hansard, I think he will find that they were not devoted to criticism of the work of the dockyards, or of the personnel or officers of those dockyards. They were devoted solely to recommending various measures and alterations in organisation and administration which would make it even easier for the dockyards to perform the admirable work which they perform to-day. I am sure that the noble Earl will not mind my pointing out that, if he disagrees with my views on those subjects, I am fortified by the knowledge that my views have been endorsed in many, if not in all, respects by members of two very capable Committees. I quite accept that the Admiralty cannot anticipate their reply to the Select Committee. But perhaps it is a good thing to let opinions be known before, and not after, decisions are taken: otherwise it means that we rather arrive at the position of sentence first and trial afterwards.

The noble Earl recapitulated the arguments about the Admiral Superintendent and the Director of Dockyards, with which he knows I am fully familiar and which were thoroughly threshed out before the Hilton and the Select Committees. It would do no good to go over that ground again. He has had his say, and I have had mine. I entirely agree that the Whitley Councils are very good. My criticisms were directed to the work of the joint committees, which has proved disappointing, especially in regard to the matter of making good the loss of production caused by the diminution of hours. As regards the Director of Dockyards, I should just like to mention something which the Select Committee said on that point in paragraph 66. They were a little lukewarm—shall I put it that way?—n their praise of the appointment. They said of the Director: His contact with Dockyards does not mean that he has held any post in a Dockyard.…The responsibilities of this post are very great indeed…and it does not appear to your Committee that they could be adequately carried out under present conditions if it were not for the fact that the post of Deputy Director is still an appointment held by an experienced professional man. I think that is rather faint praise of the Director of Dockyards.

THE EARL OF BIRKENHEAD

The noble Lord realises that I cannot answer this particular question. This matter is still sub judice

LORD WINSTER

Yes. Then something was said about apprentices. I agree that the Admiralty have no power to compel these apprentices to stay in the yards. What I am concerned about is that the conditions of service are not attractive enough for them to wish to remain, so that there is this very heavy wastage.

May I say one or two words about the remarks of the noble Viscount, Lord Hall? I am not for one moment disputing the fact that the dockyards have done extremely good work. That is generally agreed. But if you employ 50,000 men at an expense of £32,000,000 a year, you expect to get a lot of work done and quite good work, too. Therefore, it is no matter for surprise. The point I have tried to make is: could not more work be done more quickly at less cost. if the yards were better equipped, and if the structure of management of the yards were altered? The noble Viscount asked me to read paragraph 73 of the Select Committee's Report on the question of plant and equipment. I think the noble Viscount's point was that the expenditure on equipment has really balanced depreciation of machinery. Certainly paragraph 73 confirms that point of view at first sight. But that paragraph goes on to say: Even if the two figures were equal, there would still be a considerable, though concealed, rundown of capital assets, owing to the change in the value of money and the greatly increased prices to be paid for replacements … But no consideration appears to be given each year to the proper proportion to be observed between expenditure on work for the Fleet … and expenditure on maintaining the plant and machinery which is essential to keep the Fleet in being. When paragraph 73 is read at full length, it bears out the point which I endeavoured to make in my speech.

I agree with the noble Viscount that the border-line between a welfare officer and a personnel officer is very fine indeed, and I do not know that it matters very much which of the two you call him. But that does not alter the fact that the welfare officer at Rosyth said that he had had nothing to do for two years. In general, the evidence given before the Select Committee was not very Favourable about the way in which personnel or welfare work is carried out at the present time. I must say that I think this is borne out by the evidence given about the First Lord's visit to Chatham. If that is looked at (it appears on pages 90, 92 and 96), it will be seen that the staff side at Chatham were very dissatisfied indeed with the conditions of that visit. They felt that they had not had a proper opportunity of putting their case before the First Lord. They spoke of the First Lord having given them a "good hiding" to which they had no proper opportunity of replying, and they said that they felt the First Lord had acted upon inaccurate information. They particularly questioned that drop of 6½ per cent. in production. I am not mentioning this by way of criticism, but merely to show that relations between the staff and the management are not quite so happy as they should be.

VISCOUNT HALL

I was very surprised to see that reference in the Report. In my view it is absolutely inaccurate. I spent some two and half hours at Chatham. I gave everyone an opportunity of hearing what I had to say, and I listened to them. At no time was the figure which I gave questioned, either by the management or the workpeople. As a matter of fact, the figure I gave of 6½ per cent. was given to me at a conference of Admirals Superintendent who, together with the Director of Expense Accounts, had worked this figure out between them and furnished me with the information. As a matter of fact, the production now works out at about 5½ per cent. It is true that the piece workers have been able to increase their production, but even there there is a balance of about 3 per cent. As the piece workers consist of about 25 per cent. of the total number employed in the yard, I should say that the difference between production under the 47-hour week as compared with the 44-hour week is still about 5 to 5½ per cent.

LORD WINSTER

I am very glad that I mentioned the matter, and have given the noble Viscount the opportunity of making those remarks, because I confess that I was surprised when I read them. But it did seem to me, and still does—though, of course, I entirely accept the noble Viscount's remarks—that the relations between the staff and management in Chatham could not be very happy if that sort of misunderstanding and misconstruction could arise.

May I say one word about the remarks of the noble and gallant Lord, Lord Chatfield? If he reads my remarks he will find that I made no criticism of naval officers, and made no suggestion of their doing bad work, or of the dockyards' doing bad work. In summing up at the end of my speech, I have since refreshed my memory by looking at the Report of the Select Committee, and I find that every point I made is referred to, in one form or another, in the recommendations of the Select Committee. With all the will in the world, I cannot completely accept the analogy likening a ship to a dockyard. Handling a ship's company of 1,000 men is a very different thing from handling an industrial concern of 14,000 men. You have not the Queen's Regulations and the Admiralty instructions to back you up in dealing with a mixed labour force of 14,000 men.

I fear that I made a lengthy speech in moving this Motion and ought not to presume to take up any more of your Lordships' time by referring to many other points in the speeches which have been made. Even if I am considered to have attacked too strongly and made too sweeping statements, at any rate I have been fighting a single-ship action. This is not the first time that somebody has fought a single-ship action against the Board of Admiralty, and, as time has gone on, has found other ships coming to his assistance; often, indeed, in the long run, he has had the best of the battle. I cannot help feeling that that may be so today. At any rate, if I have been caned, as the dockyard workers said they were caned by the First Lord at Chatham, I am fully satisfied that our debate on this Motion has ventilated matters, and that can do only good. I am grateful to all noble Lords who have taken part in this debate and made such valuable and helpful speeches. I beg leave to withdraw my Motion.

Motion for Papers, by leave, withdrawn.