§ 4.27 p.m.
§ House again in Committee.
LORD SILKIN moved, in subsection (1), to leave out
under competitive conditions".
The noble Lord said: I beg to move the Amendment standing in my name. We have just agreed that the Board shall have supervisory functions. This Amendment relates to what will be the purpose of these functions, and the clause is pretty clear the subject. It says
…with a view to promoting the efficient, economic and adequate supply"—
and then come the words which we seek to omit—
under competitive conditions,
of iron and steel. I should like to ask the noble Marquess, if he is to reply, what does he think is added by these words "under competitive conditions"? The governing thing is what we all desire and about which there is no dispute at all—that is, that the industry shall be conducted with efficiency, with economy,
and with a view to obtaining an adequate supply. I think it has always been the claim of noble Lords opposite that, so long as those things were secured, they were not wedded to any doctrine on the subject, whether it was by means of competition or whether it was by means of public ownership. The only test was: which system provided those things?
§ I should have thought it would be wiser and more in accordance with the principles which noble Lords opposite profess if they left out those words "under competitive conditions," so as to ensure that the things that were really needed were done in the way that was most appropriate. I wonder what noble Lords would have said if, in a similar Bill, we had put in the words "under Socialistic conditions"? Would they not have denounced it as being purely doctrinal and irrelevant, and nothing to do with the main purpose of securing "an efficient, economic and adequate supply"? I submit that in putting in those words here the Government are merely committing themselves to a doctrinal statement which, in certain circumstances, could even be in conflict with the purpose they have in mind. There may be cases where it will not be possible to secure competition at all. Indeed, there is a considerable tendency in this industry, in the interests of efficiency and economy, for larger and larger units to be created—I am not complaining of that—but under this tendency, in due course, competitive conditions will be impossible. I should like to ask Her Majesty's Government, in a case of that kind, what are they to do? The Board is required to secure these things by "competitive conditions." But suppose there is a conflict between "competitive conditions" and efficiency and economy, as there may well be—as indeed there is already in certain sections of the industry, and as will be the case to an increasing extent. What will happen then? My case, therefore, is that those words are at the best unnecessary and at the worst confusing to the Board, and because, in certain circumstances, they place the Board in a dilemma, compelling the Board to choose between "competitive conditions" and "efficient, economic and adequate supply."932
§ Moreover, since the Board are charged with the duty of securing these things under competitive conditions, what is their duty when competitive conditions do not exist? Are they to go out deliberately to create them? The Committee have decided that the Board should have no powers of control. But are they to go out and use their powers of persuasion to bring about competitive conditions? Obviously not. If that is so, then what is the purpose of these words? My Amendment is designed to leave out those words which, in my submission, add nothing to the functions of the Board—indeed, in certain circumstances, they may be hampering and restrictive. It is probable that these words were inserted for purely doctrinal reasons, in order to assert the well-known belief of noble Lords opposite in the competitive principle. They are perfectly entitled to their views, but the words are quite inappropriate in this clause and in these circumstances. Noble Lords opposite may find ample opportunities for giving expression to their beliefs in competition, about which there is not a great deal of dispute. We also believe in competition where it is appropriate, but we do not believe in it as an absolute doctrine in all circumstances. If it is their intention to give expression somewhere to their belief in competitive conditions, I should have thought they could have found a more appropriate place, either in this Bill or outside it. I therefore beg to move the deletion of those words.
Page 4, line 10, leave out ("under competitive conditions").—(Lord Silkin.)
§ LORD MANCROFT
Here we have a change of tone from noble Lords opposite. They have been crisply commanding us in the last two Amendments to "put it in the Bill"; now they are equally crisply demanding that we should take it out of the Bill altogether. I think I can put Lord Sirloin's mind at rest on this matter. He is worried that the inclusion of the words "under competitive conditions" may lead to a clash of interests. I think I can make this point perfectly clear. All along in this matter the Government have taken the line that the whole purpose of this Bill is to substitute for a giant State monopoly an industry owned and controlled by a number of competitive units. That is perfectly 933 clear. It has been claimed by the Opposition (the noble Lord did not emphasize this point particularly) that competition between firms continued under nationalisation, whilst the Government's view has always been that, in course of time, common ownership under a State monopoly would have dried up competition.
The whole object of this Bill is to restore competitive conditions. In particular, in Clause 9 on prices, the Government have, in respect of castings and forgings, proposed that the price control provisions shall be available when monopoly conditions prevail and prices cannot be kept at a reasonable level by voluntary means. In Clause 27, the industry is immediately brought back under the purview of the Monopolies Commission, from which, the Committee will remember, under nationalisation, it was protected by the proviso to Section 2 (1) of the Monopolies Act. The fact that the industry is what is technically called an organised industry is, of course, one of the reasons for public supervision. The Government have, however, made it perfectly clear that one of the duties of the Board will be to try to stimulate competition. By making the steel industry subject to the Monopolies Act, from which the national Corporation was exempt, they are putting this view into practice.
The noble Lord, Lord Silkin, raised what I thought was a perfectly fair point. He asked, "What are you going to do when no possibility of genuine competition arises? Are you going to create artificial competition?" The noble Lord foresees cases where it will not be possible for genuine competition to exist. I agree that those possibilities may exist. It may be true in many parts of the industry—for instance, in tinplate, about which the noble Lord, Lord Ogmore, knows a great deal. When the new integrated plant at Velindre is operating in a few years' time, tinplate output will be virtually confined to three large integrated works owned by two companies. Since the Board are responsible for promoting economic and efficient production, they will be bound to recognise this fact—and this, I think, is the answer to the noble Lord, Lord Silkin's point—and not make a god of competition.
I will conclude by saying that these words have not been put in for any 934 doctrinal reason. Although efficient competition is something in which we on these Benches believe very strongly, we certainly do not believe in it if it is going to result in some state of affairs contrary to the industry's interest or contrary to the nation's interests. The words are inserted merely as an indication of the ideas behind the whole of this Bill—completely open ideas, of which I have tried to remind the Committee. The purpose of the Bill to substitute for a State monopoly an industry owned and controlled by a number of competitive units. There is no more evil intent in it than that, and I can assure noble Lords opposite that these words can stay in the Bill perfectly safely without in any way worrying them in the terms of the fear which the noble Lord, Lord Silkin, has in mind. I hope that with those assurances he will be content to allow the words to stay in the Bill.
§ LORD OGMORE
We have heard a gallant attempt to meet a very difficult situation, but the noble Lord, Lord Mancroft, has not answered the gist of my noble friend's complaint. My noble friend's complaint—indeed the complaint of all noble Lords on this side—is that the words are either unnecessary or confusing. We do not wish to see them in the Bill, nor do we think that any reasonable person would wish to see them in the Bill. We cannot understand why the other three adjectives in the Bill, "efficient, economic and adequate," are not sufficient. We do not think it is necessary to have this joker, as it were, put into the Bill. There are three good aces there already. Why bring in a joker? If in the future the steel industry is to be efficient, economic and have an adequate supply of iron and steel, I should have thought that that was all we in this House should require, so long as conditions of labour and so forth (with which this clause does not deal) are adequate. By putting into the Bill the words "under competitive conditions", the Government lay themselves open to the suggestion that this is a fob to those of their supporters who believe that the Government stand for the "little man," for free enterprise and for enterprise of a free nature, particularly in steel. In fact, for many years past there has been no free enterprise in steel. The noble Marquess has already paid tribute to that, when he said that the industry 935 has been so successful ever since the war started.
The Economist of August 2 said this about the proposals of the Government:
Whether it promises truly competitive private enterprise in the steel industry is distinctly doubtful.
Why did the paper say that?—because the Economist knows, as we all do, that in the world as it is to-day, in an industry like steel, there is no free enterprise. If, nowadays, any of your Lordships wished to open a tobacconist's shop in Streatham, presumably you could do so—I am not suggesting that you would want to; but there would be nothing to stop you if you did. But if any of us wanted to set up a steel works, of course we could not. The whole industry is, in fact, though not perhaps by name, one huge cartel—it was so before nationalisation and will soon become so again. That is so not only in this country but in pretty well every country in the world—particularly in the United States. The very nature of the industry enforces that situation. It is so vital to the national life of any country, either in war or in peace, that if you do not have a nationalised industry you have to have a cartelised industry to deal with steel. No private person can set up a steel works and carry on. Therefore to put in the words "under competitive conditions" is meaningless.
§ Under the present conditions—and the same applies with regard to conditions which are likely to arise in the future—there is no real competition, in the old sense, in the steel industry. A hundred years ago, of course, that was not so. I see that the noble Lord, Lord Aberdare is present. When his ancestors first came to South Wales, the industry was highly competitive; it waspossible—and it did in fact happen—for the various steel masters and iron masters and coal masters, the Bruces, the Crawshays, the Homfrays, and others, to compete; and they did. There is nothing like that to-day. The industry is all cartelised, wherever it may be. That was one of the reasons for nationalising the industry. We felt that if there was to be, as in fact there had to be, a monopoly, it should be a monopoly responsible to the public and under control of the State. What this Bill seeks to do is to retain the monopoly but without effective State control. The Bill seeks 936 to put the industry back under the control of those who are running the cartel.
§ The noble Marquess to-day threw overboard his noble friend Lord Teynham. If Lord Teynham had been an old-fashioned sailor he would have sunk, because I understand that in the old days of sailing ships sailors never learned to swim—a ship could not "back pedal" and so if a man went overboard he was left behind. But Lord Teynham is a modern sailor; no doubt he can swim, and he will eventually come to the surface. But the noble Marquess absolutely dissociated himself from what Lord Teynham said. That shows that this Bill is a very confused measure. The noble Marquess accuses us of not understanding it, but in fact his own Backbenchers do not understand it, although I understand that they have had opportunities on several occasions of hearing from the noble Marquess and others what it was all about. We have all a very great respect for the noble Marquess, and we recognise particularly the clarity with which he is able to express himself. I cannot believe that, had this Bill been capable of elucidation, he would have failed to elucidate it to the satisfaction of Lord Teynham and other noble Lords behind him.
§ The noble Marquess said that in an emergency the Board would take control, and he quoted Clause 11. I ask for guidance here, because this is a very important point affecting this Amendment. I cannot see in Clause 11 that the Board are given the powers which the noble Marquess suggests. The clause deals with the importation and distribution of raw materials and finished products, but it does not say anything about an emergency. It was a surprise to us (and this is a matter on which we should like some clarification) to hear the remark of the noble Marquess. We should like to know whether it is his view, and the view of the Government, that there is provision in the Bill for the Board, on the declaration of an emergency, or even if an emergency is not declared, to take control of the industry. Suppose for a moment that the noble Marquess is right. Where does the free competitive aspect of the industry go to, assuming it has operated under competitive conditions, if at any moment—asthe noble Marquess seems to say 937 when an emergency arises the whole industry may be controlled by the Government? That statement by the noble Marquess seems to me to be illusory. These words which we seek to omit mean nothing. They do not affect the operation of the Bill at all, and they would, of course, be jettisoned, both in form and substance, on the coming of an emergency. I would therefore suggest, in the interests of good English and clear thinking, that the Government should agree to accept this Amendment and strike these words out of the Bill.
§ LORD WINSTER
I feel I must correct the noble Lord who has just spoken upon a point of seamanship. It is quite true that the old sailing ship could not, as he put it, "back-pedal," but it could come up into the wind very rapidly indeed and lower a boat with extreme smartness, so the reasons that, according to the noble Lord, the old-time sailor gave for not learning to swim are, I am afraid, not justified.
The old sailing ships used to do more than that. They used to "back their tops'ls" and stop.
§ LORD WINSTER
I think there is only a matter of a few seconds between the speed of the two manœuvres.
I am sorry that the noble Marquess took exception to my using the words "test of sincerity" in regard to a previous Amendment, but I really think that it was a little thin-skinned on his part to object. I live never impugned the personal sincerity of an opponent, but to impugn the sincerity of a Government is quite another matter. One would require one of the new calculating machines to add up how many times the Conservative Party have impugned the sincerity of their opponents' motives. But I should not like to say a word to impair the harmony of these proceedings to which the noble Marquess has referred, and I hope it shall do nothing to offend in that respect.
I must say that these words about "competitive conditions" in the Bill are really meaningless and superfluous, and they do lend themselves to a charge of being propaganda and camouflage. If the noble Lord, Lord Mancroft, objects to the use of such terms, I would ask him to do what he has not yet done and tell us exactly why these words which we are discussing have been inserted in the Bill, 938 and exactly what purpose the phrase serves. The industry is at present as competitive as it has ever been, and I do not know whether these words are necessary to convey the impression that the industry is being returned to competition. If that is the idea of these words I am afraid that the Economist is against them, because I note that last year the Economist said that the Bill promised truly competitive enterprise was extremely doubtful. Would the noble Lord tell us exactly how the present partly competitive structure of the industry will be changed when the Bill has been passed? The industry was not entirely competitive before it was nationalised. There were various price fixing arrangements, and, if I may, I would make another quotation in this connection. The Financial Times in 1944, referring to this industry, said:In prices as in other matters the trade acts in combination.There are various international combines and cartels, and whatever else they may be, cartels are not competitive. I would say that nationalisation resulted in there being more competition in the industry than had previously existed.
Again, if we are to have these words in the Bill about competitive conditions, would the noble Lord, Lord Mancroft, tell us what is the yardstick by which the Board will decide whether a firm is running its business under competitive conditions or not? Let us suppose they arrive at such a yardstick and the Board decide that a certain firm is not carrying on production under competitive conditions: could the noble Lord tell us what powers the Board possess to do anything about it? What is there in the Bill to tell us what the Board can do if they find such a state of affairs in a firm after the Bill has become law? Another aspect of the question is this. I understand that the industry was, and for all I know will be again, dominated by some ten great firms. In time gone by I here were ninety-eight directors of those firms, twenty-one of whom sat on more than one board in the industry, so that there was an interlocking of control and responsibility. If that state of affairs is to be revived, how will these duplicate directors, if I may so term them, deal with competition between the several firms whose affairs they direct? I cannot understand how they will be able to do that.
939 The Bill lays down that the Board have to supervise (blessed word!) the industry so as to get efficiency, economy and adequate production under competitive conditions. I must respectfully congratulate the Conservative Party on their tardy conversion to the necessity for supervising private enterprise. But, as so often is the case, the conversion does not seem to be quite wholehearted, because in another place they rejected a proposal that supervision should be carried out in the public interest. What is the good of supervision unless it ensures the public interest? I do not know. What if, as may well be the case, the public interest were to demand in a given case either for security or for technical efficiency, or for any other reason, that there should not be competition? These completely superfluous words in the Bill nevertheless demand that there shall be competition. What do the Government really want? Do they want security and efficiency or competition for the sake of competition? I use the word "superfluous" for a definite reason. If business is to be carried on with efficiency and economy and for the ensuring of adequate supplies, as the Bill directs the Board, what is meant by throwing in competition? Surely efficiency and economy and ensuring adequate supplies of the commodity are covered by these other words. Why throw in the question of competition, which cannot add anything to the efficiency with which the industry is carried on? The whole contains the part, and the Government have introduced some completely superfluous words.
I read the whole of the Report of the proceedings in another place, and the only reason I have seen advanced by the Minister for the insertion of these words in the Bill is that they impose a duty on the Board to keep restrictive arrangements under review. Again, that is fully covered by the duty laid upon the Board to ensure efficiency. Efficiency cannot be ensured without restraining restrictive practices. Suppose the Board find that restrictive practices exist contrary to the efficiency of the industry, would the noble Lord, Lord Mancroft, tell us where it is said in the Bill that the Board are given powers to deal with such practices? There is nothing in the Bill about that. 940 There are really no arguments for these words, except, I fear, and I say it with regret, that they are introduced for propaganda and camouflage purposes, to make the public believe that the Government are going to restore to competition an industry in which nationalisation had destroyed competition.
§ 4.55 p.m.
§ LORD SHEPHERD
May I ask a question and not make a speech? I understand that the noble Lord, Lord Mancroft, said that these words were included not for doctrinal reasons but for the purpose of ensuring that this great industry, which can be carried on profitably on an organised basis, shall be divided into parts so that the parts can compete one with the other. I can understand that reason, but the word "competition" suggests something else to me. The industry in Great Britain will not only be competitive within itself, but it will have to enter into competition with steel industries abroad, and in order to overcome competition from abroad it will have to make sure that the prices it charges for its materials come below the prices quoted abroad. Suppose that, in order to achieve that purpose, it is suggested by four firms making a product which I shall call a that the production of that article shall be carried on by one firm instead of four, in order to get a complete degree of organisation, to cut out unnecessary competitive costs and to ensure that the price is reasonably low. Will the words in the Bill prevent the Board from agreeing to such a proposal, either from the four firms concerned or from the Steel Federation itself—a proposal designed to enable the steel industry in this country to beat its foreign competitors? It is very important that we should know what these words mean and how far they will thwart the Board from doing the effective work they are supposed to do.
§ THE MARQUESS OF SALISBURY
The noble Lord, Lord Silkin, who spoke first said that he did not understand what the words meant. I shall try to explain them to him.
§ LORD SILKIN
I hope the noble Marquess does not think I said I did not understand what "competition" means. What I said was that I did not understand it in this context.
§ THE MARQUESS OF SALISBURY
What it implied—I think that would be a fairer word to use. The noble Lord seems to assume that this is just an ingenious idea of the Government, put in on their own initiative; that nobody had encouraged them to put in these words; that there was no reason for putting them in, and so on. They were put in originally for a definite reason. The reason was that with regard to this Bill, as your Lordships will remember, Her Majesty's Government adopted rather a novel procedure. Before the Bill was introduced, as far back as the summer of last year, they published a White Paper on the scheme they proposed to introduce, and said that they would welcome constructive criticism. This is one of the constructive criticisms they got from all parts of the House—I can give a quotation from the Party of noble Lords opposite in another place if it is desired. There were people who said that there was no reference to competitive conditions; that the Bill was not intended to create competitive conditions, and so on. Therefore, after careful thought, Her Majesty's Government decided, in order to make their attitude and their intentions absolutely clear, that they would include these words.
I forget which noble Lord it was who quoted from the Economist—I think it was the noble Lord, Lord Winster. It is true that the Economist used the words exactly as he quoted them, but I would remind the noble Lord that the words from the Economist date back to the time of the White Paper last summer, when there was no reference to competition. I believe I am right in saying that after the Bill was published, both the Economist on November 15, and The Times on November 7, expressed approval of the insertion of the words "under competitive conditions." Therefore I think the purpose which the Government had in mind, or one of the main purposes, was to indicate their underlying attitude to the problem of competition, and the effect was to produce the results they had intended. Suppose we had not put in these words but had left things exactly as they were. I have not the slightest doubt that, either in the other place or in this House, someone would have risen to his feet and said that the real truth was that the Government were aiming at a private monopoly; that all 942 this talk about competition in the past, if I may use Lord Winter's words, appeared to be eyewash; that we had not even taken the trouble to mention the desirability of competition in this important Bill. I can almost hear these admirable speeches being made, and probably made quite effectively.
It certainly is not our object to create a private monopoly. Indeed, as your Lordships know, Her Majesty's Government have taken steps which may have the effect of making the industry subject to the Monopolies Act—which, I may say, noble Lords opposite never did with regard to their own Act, although the Monopolies Act was their own production. That, I would say to the noble Lord, Lord Winster, is the action which can be taken. The noble Lord asked what could be done to ensure competitive conditions. If there is a situation of monopoly, the matter can be brought to the Monopoly Commission under the Monopolies Act. This, at any rate, is some action which was not possible before.
I am not going to pretend to your Lordships that absolutely free competition is always possible in the modern world: we all know it is not, and it would be foolish for me to suggest any such thing. Therefore, the words—and this I would say in answer to the noble Lord, Lord Shepherd—do not mean that in every conceivable given condition the need for competition must override every other consideration. What they mean is that we hope to create in the industry a competitive atmosphere; an atmosphere where there is a great deal more competition than there was under the existing Act, when there was a complete State monopoly. It is the purpose to re-create, so far as possible in the modern world, competition. I believe it is valuable to have included in the Bill itself these words which clearly indicate the intention of the Government.
§ LORD SHEPHERD
The noble Marquess will forgive me for interrupting. If under the conditions I mentioned it became proper that four steel works, or parts of steel works, should be closed down in order to enable the industry to meet foreign competition, would not the words which appear in this clause prevent 943 the Board from giving approval to the proposal, even though it were backed up by the Steel Federation itself?
§ THE MARQUESS OF SALISBURY
I do not think they would. In my view, the Board is always bound by the national interest as an overriding consideration. As I said, it is easy in a debate of this kind to produce any number of hypothetical situations which may not occur in a hundred or two hundred years. "Does the Bill cover this? Do these exact words cover that?" If you try to draw your legislation on that basis, you will never get anywhere. These words are a broad statement of intention; it is competitive conditions which we seek to create. I cannot define them clearer than that, and I should have thought that they were perfectly clear.
§ LORD WILMOT OF SELMESTON
The noble Marquess will appreciate that what we have in mind are not hypothetical situations, but the actual situation which formed the subject of one of the most valuable recommendations of the Report of the Anglo-American Productivity Committee on the Iron and Steel Industry. There is no virtue in competition merely as a label, nor is there in monopoly. The virtue lies in what happens. This most valuable Report of this authoritative Committee says:In all sections of the British iron and steel industry the greatest limitation upon productivity to-day is the size of the unit and plant.I will not worry your Lordships with the rest of that paragraph, but the next paragraph goes on to say:Largely because of the relation between the size of the unit plant and the size of the works, the efficiency of the integrated steel works is limited again by its size.Finally, it says:It will be necessary for development and re-equipment to be concentrated in the works most suitably sited for expansion.This industry has in the course of the last few decades developed monopolistic tendencies. It has probably the most powerful trade association of any industry in the world, efficiently run and conducted with great skill; and, so far as it is possible for men charged with duties to their shareholders as paramount requirements, it is conducted in the public interest. But, as I have said before, the 944 very nature of the industry forces it into monopolistic courses. Therefore I feel it would be wise—and there are no Party politics in this—if the Government took these directing words out of the Bill. After all, here is one of the signposts to the new Board. They are to supervise this industry in such a way that they have great regard for its competitive nature. What we want is the maximum of efficient production. It is because we believe that some form of monopoly is inevitable in this industry that we prefer to have a public monopoly to a private monopoly. But I am not arguing that. I do feel it would be wise, in these circumstances, to take these limiting and perhaps thwarting words out of the declaratory part of the Bill.
§ LORD SILKIN
I think we have threshed this matter out adequately; and, if I may say so with respect, one of the great advantages of a good humoured discussion such as we have had on this Bill so far is that generally speaking at the end of a discussion we know exactly what is in the mind of the other. I now understand from the explanation of the noble Marquess exactly why those words were put in. Even if it is desirable in some part of the Bill to give expression to the principle of competition, I am not convinced that this is the right place. It gives rise to certain difficulties and inconsistencies. I will not ask the noble Marquess for any undertakings. I am going to withdraw the Amendment, but I hope that he will look at the matter again and see whether it cannot be improved.
What I understand the noble Marquess to say is that he recognises that in some cases competitive conditions are really either impossible or undesirable, but that generally speaking competition is a good thing and that it is desired to give expression to that in this Bill. It may be that the right kind of words is "wherever practicable," or "wherever appropriate," or something of that sort. I am not trying to draft this Bill standing on my feet. I hope the noble Marquess will be prepared to look at it again and at the next stage see whether something better can be done. Without asking him for any definite undertaking, I would be willing to withdraw the Amendment.
§ THE MARQUESS OF SALISBURY
I do not know whether the noble Lord wants me to say anything, because he threw a 945 beautifully decorated fly over me. I could not give the noble Lord any undertaking at all, because in our view this is perfectly clear. It represents, as I say, the broad conception which we have in mind. Of course, if the noble Lord asks me, I will refer the matter again to my right honourable friend, but I should not like him to think that his fly has caught a fish.
§ Amendment, by leave, withdrawn.
§ 5.13 p.m.
§ LORD WILMOT OF SELMESTON moved, in subsection (1), after "conditions" to insert "and the equitable distribution." The noble Lord said: I must apologies to your Lordships for yet another Amendment to this clause. We have spent rather a long time on it, but it is a very important clause because it sets out the duties of the Board. Unless the duties are correctly and properly defined, the rest of the Bill is not much use. The purpose of this Amendment is to insert the words "and the equitable distribution" of the products, so that the duty of the Board will be not only to promote the efficient, economic and adequate supply of iron and steel products but also to promote their equitable distribution. I suggest to your Lordships that this is a necessary part of their duty. This supervision over the distribution of the products of this vital industry has, in fact, in the past formed a very major part of the duties of the various supervisory organs which have been associated with the iron and steel industry, under Governments of all colours, for a very long time.
§ There are several reasons why it is necessary. In times of shortage of steel products—and it should not be assumed that we are immediately emerging from a shortage of all forms of steel products—it has often been necessary for the board of control to give a direction as to the distribution of the products. Instances which occur to me are steel intended for the use in the development of the coal mines; steel needed for the proper development of railways and harbours, and for other works of vital national importance to defence or to commerce which require priority over other forms of user. Then there is the fact that in this industry there are a number of vertical combinations, so that you have a producer of primary products—and this is 946 true of most of the modern plants—while the metal is still hot proceeding to roll and fashion it into Various stages in its course towards the consumer. It is easy to envisage circumstances which have often arisen where integrated firms retain the whole of their product of a particular kind of iron and steel for use in their own finishing factories, and thus starve other competitive units, who do not produce the raw material but fabricate it, of the materials of their trade.
§ When this situation has occurred in the past—and sometimes it has occurred where the product is one which the national interest requires produced—the Iron and Steel Board have made a direction that there should be some alteration in the distribution of the product. Those of us who follow trade and industry have probably all come across examples of this kind. I have, and I suppose that I can say that I have an interest in the matter. But certainly those who use iron and steel products in any time of shortage sometimes require to ask for a direction that they should have a reasonable supply of the raw material. That duty was clearly placed upon the original Steel Board; later it rested on the present Iron and Steel Corporation. Now, for the first time, it is to go. We can see that the Iron and Steel Corporation faithfully discharged their function, because in their Report they set out what happened to the product and how much of it was sold down to consumers outside the nationalised sector. As I say, unless these words are inserted in the for the first time for very many years there will be no protection for the consumer who is not a primary producer, and having regard to the Government's declared intentions on this Amendment, I believe that we may expect them to agree. I beg to move.
Page 4, line 10, after ("conditions") insert ("and the equitable distribution").—(Lord Wilmot of Selmeston.)
§ 5.19 p.m.
§ LORD MILNER OF LEEDS
I desire to support this Amendment, which appears to me to be a very important one. The clause seeks to provide for the efficient, economic and adequate supply of iron and steel products under competitive conditions, and there should be some assurance that those who require the products of the iron and steel industry will receive them. Your Lordships are 947 aware that in the Third Schedule those products are set out under the heading of "Iron and Steel Activities." They includethe quarrying or mining of iron ore,which is obviously essential to every industry having to do with iron or steel. There isThe casting of iron or steel by any process.Your Lordships know that castings are required by all sorts and conditions of engineers. There isThe production, with or without heat, of iron or steel forgings,again a requisite of almost every class of engineering. There is, too,The production of tinplate.It seems to me that there should be some provision whereby the Board are under an obligation to ensure the equitable distribution of those and other products of which they have charge.
What is to happen if, for example, a small man in a small business desires supplies? One knows that for years during the war, and I believe for some years since, there have been shortages. I believe it is so even to-day, and that steel products are nothing like sufficient. Who is to see to it that every small man, or every large man for that matter, obtains a fair share—as they say in Yorkshire, "fair do's"—of whatever is being produced by the industry? This is not a theoretical question. I recollect an honourable Member in another place who ran a very successful engineering business not a hundred miles from Grantham during the War, and immediately thereafter prepared plans for—and, indeed, turned out—the first model or two of a small car, and also of a tractor. I have no personal knowledge of the facts, but I understand from him that he had to close down because he was unable to get from the manufacturers of his raw materials the raw material he required to enable him to provide that car and that tractor—and no doubt other products. That happened in the case of individual companies known certainly to the majority of us on this side of the House, and it may happen to many others. And this was not a small man, either.
What is going to happen to the small man? What rights and what remedies 948 has he? To whom does he complain if he does not get a fair allocation of the products of the industry? I do not know whether the co-operative organisations manufacture anything from steel products. If they do, supposing that they do not receive what they are entitled to, to whom do they complain? Take the National Coal Board—I know there has been some prejudice in that direction—or British Railways. British Railways are short of certain classes of steel, for railway lines and so on. What is their remedy if there is no assurance that the Board, who are responsible for the provision of this steel, are not under a duty to ensure equitable distribution? It is curious that the Board have power to review prices. If in that connection there are reserve powers given to the Government whereby, in effect, they can override the Board, perhaps the noble Lord can tell me whether there is any provision for the Government to intervene in a matter of this sort. Is there any overriding provision whereby the Government can allocate steel? Can a Member of Parliament, either in your Lordships' House or in another place, put a question—and if so who is the authority? Who has put upon him the duty of allocating steel?
So far as I can see, there are no such reserve powers. We heard from the noble Lord, Lord Layton, on Second Reading, that the High Authority in connection with the Schuman Plan had the power to make allocations. I know that we shall have the noble Lord with us on this occasion, because there does not appear to be any power in this Bill for the Board or the Government, or any high authority, to make allocations—I may be wrong, but that is my impression. Mr. Strauss put such a provision in the original Bill. It was thought then to be essential; and in my submission it is essential now. I hope the Government will think it right to accept this principle and ensure a fair distribution of the products of the industry.
§ LORD WOLVERTON
If there are semi-finished articles which are being distributed, surely, if there is a great scarcity, it should not be the duty of the Board to allocate; it should be the duty of the Government of the day. We now have a rationing scheme of semi-finished raw material. I should have thought 949 that, if it was necessary to introduce a scheme, it should be the duty of the Government and not of the Board.
§ VISCOUNT SWINTON
In the same way as the steel allocation scheme was introduced under the late Socialist Government.
§ LORD MILNER OF LEEDS
There would have to be some special provision with regard to that. It was provided originally in the Iron and Steel Act.
§ VISCOUNT SWINTON
No: with great respect, it was not. That steel allocation was not done under the Iron and Steel Act—and deliberately. The late Government did not suggest for a moment that even the Minister of Supply should administer it. As a matter of fact, I had to administer it when I succeeded. The power to impose a scheme of that kind was under one of the Supplies and Services Act Orders. It was never part of the Iron and Steel Act.
§ LORD WILMOT OF SELMESTON
But the noble Viscount will remember how the thing worked, since he had a part in it. The duty was clearly laid on the Iron and Steel Board. The noble Lord is speaking about the licensing scheme. That licence is a duty or a permission to give an order, and a permission to someone to execute the order; but it does not guarantee the supply. Many times I have known people with a handful of licences unable to get the product to which the licences referred. They have had to go to the Iron and Steel Board and get a direction to the supplier to supply. That is how the thing works. And it is because under this Bill that machinery is now to go, for the first time, that it is important that these words should be put in. Otherwise, unless you are a manufacturer of your own raw material, you are in jeopardy as regards supply.
§ 5.28 p.m.
§ LORD MANCROFT
This Amendment would give the Board the duty of promoting "equitable distribution" of iron and steel products in addition to 950 their "efficient, economical and adequate supply." It is clear from Lord Wilmot's speech that he desires to be helpful in this matter, for which I thank him but while thanking him ought perhaps to warn him that I fear his help is a little misconceived. I think his fears are unjustified. When I first saw this Amendment on the Paper I was a little doubtful as to what was intended by the words "equitable distribution" in this context. I could not quite see how they applied to this Bill.
If I have understood aright the argument of noble Lords opposite, there are two different types of "equitable distribution" which the Opposition have in mind. The first is the fair distribution of semi-finished products within the industry, with the aim ensuring that the vertical concerns to which Lord Wilmot referred, producing from the raw material to the finished product, should not starve the finishing concerns not producing their own raw materials. The second was the fair distribution of the final products of the industry between the various consumers. I think the answer to the first point is that it is already provided for in Clause 3 (1) (b), which gives the Board the duty of keeping under review the arrangements for procuring and distributing raw materials for use in the steel industry.
§ LORD MANCROFT
Since "raw material" is defined in Clause 34 as including materials subjected already to any process or processes, it clearly includes pig iron or semi-finished steel used by an iron and steel producer to make an iron and steel product. The promotion of the appropriate distribution of semi-finished products within the industry is, therefore, already made, so far as I understand it, a part of the Board's duty.
§ LORD MANCROFT
I beg your Lordships' pardon. It is page 33, Clause 33. The important point I want to stress about it is this—and I come back to the 951 exact meaning of the word "equitable"; and this is where I think the noble Lord and I differ, for good reasons. I do not think that the overriding consideration should be the word "equitable." The criterion is not whether distribution is equitable. That is a desirable factor—at times a very desirable factor—but surely the overriding criterion is the efficient, economic and adequate supply under competitive conditions. The Amendment which the noble Lord has moved in this regard is, at best, redundant, and might, indeed, indicate (the noble Lord, Lord Milner, has put this into my mind) that "fair shares" were more important than efficiency. I hope that I misconstrue the noble Lord's words when I say that.
§ LORD MANCROFT
They may well be complementary, but it must be efficiency which, in the last resort, is the overriding consideration. That may bring about some small degree of unfairness; I appreciate that.
On the second point, if I understood the noble Lord correctly, I am advised that the legal view is that the word "supply" includes "distribution." The Board's duty to promote efficient, economic and adequate supply under competitive conditions thus covers, as I understand it, efficient and competitive distribution, and the Board will be concerned with the general arrangements for marketing by producers—for example, arrangements with merchants and stockholders, so that the genuine needs of consumers, small and large alike, can most conveniently be met, and the consumer has the choice of buying what he wants. They will, in particular, use their influence to bring to an end undesirable restrictive agreements. That is a point we have already discussed on the previous Amendment, when we talked about monopolistic tendencies.
In normal times of rough balance between supply and demand, this supervision, I should have thought, would be adequate. In times of scarcity, like the years since the war, it may be necessary to have an allocation system; but it would be wrong, surely, to give the task of allocation to a Board set up to supervise one particular industry. This point has already been discussed by noble 952 Lords who have practical experience of it, whereas my experience is purely theoretical. But it seems to me that an allocation in the national interest, which, incidentally, in practice is often extremely inequitable, is a job for the Government and not for any one particular industry or one particular Board. The Board cannot be expected to know the national need as regards allocation between different industries. Indeed, the Labour Government, as the noble Lord himself has suggested to us, I think, like the present Government, did not regard it as an appropriate function for a Departmental Minister, like the Minister of Supply, but rather as one for an inter-Departmental Committee, with a specially appointed chairman.
Moreover, any system of allocation involves automatically some form of discrimination, and equitable distribution, which is all that the Board could seek to secure, might at such times—this is where I differ from the noble Lord—run contrary to the national interest. Of course, the Board will seek to promote equity, whenever they can, by persuasion and by leadership. Naturally, that is important. What could be a more unhappy industry than an industry which thought that inequity prevailed? From top to bottom the industry would be discontented if it were thought that equitable distribution was not the watchword. I would ask the noble Lord, however, to agree with me in thinking that it should not be the overriding consideration, very important though it is, but that the national interest, which may at times clash with equitable distribution, is the overriding factor. I hope that, with that explanation and my thanks to the noble Lord, Lord Wilmot, for the careful and helpful way in which he put this important idea forward, he will agree to withdraw his Amendment.
§ 5.35 p.m.
§ LORD WILMOT OF SELMESTON
One of the penalties of being on this side of the House is that one is bereft of the actual assistance of the Government draftsman. Therefore, I would never cling to a form of words when I have been shown, as in this case, by the noble Lord, Lord Mancroft, that the words themselves are not quite the right ones. Therefore, I hope that the Government will agree to try to find the right words to give effect 953 to an idea which obviously has their sympathy. It is not mathematical equity which we seek: it is the national interest; and it is not in the national interest, in many circumstances, that producers of certain kinds of essential products should be starved of their raw material because the people who make that raw material have a fabrication plant which they will enlarge or use to absorb their whole output or, alternatively, tune their output of that kind of iron and steel product to the capacity of their own finishing works.
One has only to look at the ramifications of the United Steel Company, of the Lancashire Steel Corporation, of Guest Keen Baldwin and of Guest, Keen And Nettlefolds (to take some of the famous names in this industry) to realise that those circumstances may occur in the future as they have in the past. Wire is a case in point. There are very few big wire drawers. Most of them are users of that product, and there have been quite a number of occasions when the supply of wire has been not more than was necessary to feed their own plants. Special producers of other products, very necessary, might frequently have gone without but for the intervention of the Board. The same is true of sheets and plates, and other forms of semi-finished steel which are used by industries of every kind and who have a right to some court of appeal to which they can go if they feel that not only are their own pecuniary interests being affected but that the national supply of an essential product is being limited.
This is the dilemma. The primary producer feels that he is acting perfectly properly in doing the most profitable thing for his particular shareholders, using the whole of his output in his particular works. Maybe that particular form of product is less profitable than other forms, so that he does not want to make it for other people besides himself. I attach no blame in this matter, because t is part of the dilemma in which the Government put themselves by denationalisation, that they have to have regard to these commercial considerations
§ which govern the actions of boards of directors. May I make an appeal to the Minister to give an undertaking that the Government will alter the words to safeguard this situation which I have tried to describe? If they will do that, I will not press these words to a Division. But I regard this, as we all do on this side of the House, as a very important principle and, I may say, it is so regarded outside this House. This particular matter is of the greatest consequence to many industries, and unless the Government will try to put it right, I am afraid that we shall have to have a Division, in view of the importance of the principle involved.
§ LORD MANCROFT
I am afraid that I cannot give him the undertaking he wants, for reasons which I think I have made perfectly clear. In regard to my assurance that the fears from which he was suffering are unjustified, I will, however, make certain that the points he was making are already covered in the Bill. I will make certain, if he likes, that I was speaking the truth, but I am pretty sure that I am well advised and that all the fears which lie has voiced this afternoon are met in the Bill. I can go no further than that. I am afraid that I cannot give him the undertaking for which he asks, and if- he must press his point more strongly, then press it he will.
§ LORD WILMOT OF SELMESTON
I am afraid that is what we shall have to do, because neither I nor anybody else can find any place in the Bill where this protection, which has existed hitherto for a very long time, is not being taken away. Therefore, I must press the matter to a Division.
§ On Question, Whether the Amendment shall be agreed to?
§ Their Lordships divided: Contents, 20; Not-Contents, 40.955
|Baldwin of Bewdley, E.||Chorley, L||Ogmore, L.|
|Jowitt, E.||Haden-Guest, L.||Pethick-Lawrence, L.|
|Henderson, L.||Shepherd, L.|
|Hall, V.||Kenswood, L.||Silkin, L.|
|Lucas of Chilworth, L||Strabolgi, L.|
|Bingham, L. (E. Lucan) [Teller.]||Macpherson of Drumochter, L.||Wilmot of Selmeston, L.|
|Milner of Leeds, L.||Winster, L.|
|Burden, L. [Teller.]||Morrison, L.|
|Simonds, L. (L. Chancellor.)||Bridgeman, V.||Gifford, L.|
|Buckmaster, V.||Howard of Glossop, L.|
|Salisbury, M. (L. President.)||Davidson, V.||Jeffreys, L.|
|Furness, V.||Jessel, L.|
|Cholmondeley, M.||Goschen, V.||Layton, L.|
|Willingdon, M.||Long, V.||Leathers, L.|
|Swinton, V.||Llewellin, L.|
|Alexander of Tunis, E.||Mancroft, L.|
|Birkenhead, E.||Aberdare, L.||Milverton, L.|
|Buckinghamshire, E.||Carrington, L.||Rea, L.|
|De La Warr, E.||Cherwell, L.||Remnant, L.|
|Dudley, E.||Chesham, L.||Templemore, L.|
|Onslow, E. [Teller.]||Fairlie, L. (E. Glasgow.)||Teynham, L.|
|Selkirk, E. [Teller.]||Freyberg, L.||Wolverton, L.|
|Shaftesbury, E.||Gage, L. (V. Gage.)|
Resolved in the negative, and Amendment disagreed to accordingly.
§ 5.48 p.m.
§ LORD JESSEL had given notice of two Amendments to the proviso to subsection (1), the first being at the beginning of paragraph (i) to insert "either." The noble Lord said: On the Second Reading of this Bill I raised the point covered by this Amendment, and the noble Viscount, Lord Swinton, in his winding up speech was good enough to say that the Government would give further consideration to the position of foundries under the Bill. The Amendment does not touch on raw materials, which we were told was the reason for including foundries within the scope of the Bill. My Amendment deals with such matters as training and education, safety, health and welfare, and arrangements for joint consultation. In these respects the Government have already excluded the tied foundries from the scope of the Board, and we contend that the independent foundries, which are equally part of the engineering industry, should be treated in a similar manner.
§ All we ask is that where the Government are satisfied that independent foundries already have their own machinery for dealing with matters concerning industrial relations, those foundries should be excluded from supervision by the Iron and Steel Board. We have been told that the Board has no powers, but advice from a Board of this kind can, on Occasions, be equally effective and disturbing to the recipient of that advice. We have the precedent of the Road Haulage Wages Act, 1938. This Act excluded from the supervision of a board firms which already had satisfactory conciliation machinery. It is on those lines that this Amendment is drawn, and I hope 956 the Government will see their way to accept it. I beg to move.
Page 4, line 33, at beginning insert ("either").—(Lord Jessel.)
§ 5.50 p.m.
§ THE MARQUESS OF SALISBURY
The noble Lord, Lord Jessel, has in the speech to which the Committee has just listened explained, I think with great clarity, the purpose of his two Amendments. If I understand him aright, his point is that the arrangements for training, welfare and labour relations in many of the foundry firms—whether tied to other works or not—are governed by agreements made for the engineering and allied industries between the engineering employers' federations and the engineering trade unions, and he and others are anxious that the setting up of the new Iron and Steel Board with the wide duties set out in paragraphs (1) (d), (e) and (f) of Clause 3 should not jeopardise these arrangements. There are, I gather, fears that intervention in these arrangements by the Board, however well-intentioned it might be, might prejudice them and put in peril the work of many years of patient negotiation. The noble Lord's Amendments, therefore, as I see it, seek to exempt from the Board's supervision of training, safety, health, welfare and joint consultation, foundry firms whose arrangements for joint consultation are part of wider general arrangements negotiated by the two sides of an industry not mainly concerned with iron and steel—notably, of course, the engineering industry.
I think it may help the noble Lord and other noble Lords if I explain in a very few words Her Majesty's Government's intentions in framing Clause 3 (1) (d), (e) and (f). The Government take the view 957 that a Board responsible for promoting the efficient, economic and adequate production of an industry must have some regard for and supervision of such important matters—such increasingly important matters—for production as the training, safety, health and welfare of the workers and the arrangements in the works for joint consultation. As your Lordships will know, the iron and steel industry has art admirable history of labour relationships. It is, I believe, second to none, and it is our belief and hope that those relationships, which have been equally good under private and under public ownership, will so continue for a great many years to come. None the less, we have thought it right to charge the Board with the duty of keeping under review the collective arrangements in the industry for the promotion of research, training, safety, health and welfare—that is provided for in paragraphs (d) and (e)—and the arrangements for joint consultation in the factories in the industry—that is in paragraph (f).
I explained during the Second Reading debate, I believe, that it is the Government's view that the Board's best work will be done by its prestige and influence, and these are none of them matters in which—except for the spending of money on research and training—the Bill gives the Board any actual powers. Indeed, the Government are sure that the Board would not wish, even if it had the power to do so, to intervene in arrangements built up over the years and operating so smoothly on the basis of mutual confidence. The Government moved in another place the proviso which your Lordships will find at lines 32 to 48 on page 4 of the Bill, to make it clear that in these matters the Board's supervision would not extend—and this is Lord Jessel's point—to works where the foundry was only an incidental part of a larger works, and where the joint consultation machinery in the works embraced the foundry workers equally with the others. That was to avoid undesirable duplication.
The Amendment moved by the noble Lord, Lord Jessel, if I understand it, seeks to extend this proviso to what I may call independent foundries whose arrangements for the matters set out in paragraphs (d) to (f) are part of the joint arrangements for the engineering or 958 some other industry. I feel that this would be going too far. If we are agreed—as I am sure we all are—that these matters are of the highest importance to efficient economic and adequate production, and if we want the Board to be in a position to fulfil its important duty of promoting such production, then we must, as I see it, give the Board the duty of keeping these arrangements under review—that is, watching, promoting and helping but not, if I may use such words in your Lordships' House, unnecessarily butting-in. It would, I am certain, be wrong to exempt by statutory provisions any particular group of concerns just because at a particular point in time they had geared their arrangements to other industries. If my right honourable friend had felt that the fears which Lord Jessel has expressed were real, I know that he would have tried to meet him. I would, however, remind noble Lords that the Board has not been given powers to direct what form the arrangements on such matters should take, and the Government are confident that a responsible Board would not consider, for one moment, interfering or intervening between the two sides of industry in agreements affecting firms coming under its supervision. I am very grateful to the noble Lord for raising this matter. It has been very helpful in clarifying the position. I hope that after the explanations and assurances I have given him he will agree to withdraw his Amendments.
§ LORD SILKIN
I should like to say one word upon this Amendment. I do not think I can really add much to the very clear statement of the noble Marquess, a statement with which we on this side of the Chamber all agree. Is it not the case that if this Amendment were accepted it would mean that every single independent concern would have to be examined by the Board to ascertain whether it satisfied those conditions or not? You might get a portion of the industry coming within the Act and a portion not doing so. It would really be a very unsatisfactory state of affairs in regard to foundry firms to have some in and some excluded on a basis of whether certain arrangements had been made between employers and employees. For those reasons I believe that the Amendment really cannot stand up.
§ LORD JESSEL
In the first place, I apologise for speaking on two Amendments at the same time. Secondly, I should like to thank the noble Marquess for the extremely full answer he has given to my point. I realise that the Minister of Supply has taken a considerable amount of trouble over this matter: I know he has had a great many interviews with people concerned. I was just trying to put the point of view of the independent foundries, and the noble Marquess has explained why the Government cannot accept the Amendment. In the circumstances I beg leave to withdraw it.
§ Amendment, by leave, withdrawn.
§ 6.0 p.m.
LORD BURDEN moved, after subsection (1) to insert:
(2) The Board shall, in the performance of their duty under the preceding subsection, have regard to the need to secure full employment in Great Britain and to any other considerations relating to the national interest to which the Minister may have asked them to have regard.
The noble Lord said: In the absence of my noble friend Lord Lawson, I beg to move the Amendment standing in our names. As the noble Marquess the Leader of the House said a moment or two ago, this industry has a remarkable record of labour relations. Over some ninety years the workers in this industry have built up a strong and powerful organisation and they have produced some remarkable men—before the formation of the Confederation in 1917, men like John Hodge, and since the formation of the Confederation, Sir Arthur Pugh, happily still with us, and Sir Lincoln Evans. I do not think it is an exaggeration to say that in the proper carrying out of this highly skilled craft which has a high degree of risk the safety of this country both in peace and in war depends. I think I can also claim that in both world wars the industry made a wonderful contribution to the nation's safety. What it has done in post-war years everyone will agree is something of a record.
But in the labour and trade union world there are long memories, and those employed in the industry remember what happened after the First World War. With your Lordships' permission, I should like to quote from what is now a rare document, a pamphlet entitled, What is
Wrong with the British Iron and Steel Industry, issued by the Confederation in 1930 and dealing with the problem of unemployment. Incidentally, although it is not germane to the point I am making, in this document the Confederation ask for something very much like what was put on the Statute Book by the Labour Government. This is what the statement says, regarding the conditions after the First World War:
After about twelve months of inflated trade, the industry in 1920–21 dropped into the inevitable slump. During the years that have elapsed, in which the industry has been struggling to find an outlet for its products, prices as regards a considerable percentage of those products have dropped to a level even below the cost of production. Wages have followed suit and abnormal conditions of employment and unemployment have occurred.
§ The statement goes on to set out figures comparing unemployment in the iron and steel industry with general unemployment. In 1924, the yearly average of unemployment in the pig iron industry was 14.3 and in steel smelting, iron puddling furnaces and rolling mills, it was 21.1, while the general level was 10.4. So it went on (I will not trouble your Lordships with all the figures) until 1930, when in the pig iron trade unemployment was 23.9 and in steel smelting, et cetera, 34.1, while the general level of unemployment was 16.6. Throughout the whole table unemployment in the iron and steel industry was approximately double the general rate of unemployment in the country. That condition prevailed almost up to the outbreak of the Second World War, notwithstanding the burst of employment which came from a measure of rearmament.
§ Strange as it may seem to noble Lords opposite, we on these Benches hold that those who have invested their labour power in this industry have an interest second to none in it. My first Amendment endeavours to place fairly and squarely on the shoulders of the Board the duty of endeavouring to secure and maintain full employment. The noble Lords in charge of the Bill say that they are going back to competition; they do not even say regulated competition or licensed competition, but back to the days of laissez faire. The noble Marquess who leads the House says that they are the evolutionary Party and we are the "stick-in-the-muds"—but they are going back to the very condition in which the 961 iron and steel industry was twenty years ago, described in this pamphlet issued by the Confederation. They are the backward-looking Party and we the forward-looking.
§ In order to avoid a second discussion, may I say a word or two in regard to the next Amendment? The first Amendment endeavours to place the responsibility for securing and maintaining full employment in the industry fairly and squarely on the Board. If that is not accepted, the second Amendment provides the alternative: that the Government should assume responsibility. That is in accordance with the White Paper in regard to full employment which was issued by the Government before the 1939–45 war came to an end. If we wish this industry to continue to make its great contribution to the export trade and to the national well-being, please do not even seem to indicate to those engaged in the industry on the labour side that they are going back to the terrible conditions which obtained in the inter-war years. Surely, it is not too much to ask that in a Bill of this kind the Government should declare their intention that, so far as it is humanly possible, they will endeavour to secure that the workers in the industry never go back again to those dark days. In that spirit, I plead with the other side to accept this Amendment.
§ Amendment moved—
§ Page 4, line 48, at end, insert the said subsection.—(Lord Burden.)
§ LORD MANCROFT
The noble Lord, Lord Burden, has given us an interesting and characteristic speech. I do not think that anybody could complain of the general sentiments to which he gave expression. He hoped to see an industry in which full employment is the order of the day; he deplored and was horrified at the prospect, or the possibility, of any return to conditions of unemployment within the industry. Nobody on any side of the House could possibly disagree with him for one moment. But what I do disagree with him about is his attempt to incorporate these sentiments at this juncture in this Bill. This Amendment would insert a new subsection requiring the Board in discharge of their general duty to have regard tothe need to secure full employment…and to any other considerations relating to the national interest to which the Minister may have asked them to have regard.962 As I see it, the arguments against a provision of this kind are these. This is an attempt by the noble Lord to give the Board a responsibility for a matter of public interest far beyond the scope of the iron and steel industry. A Board set up to supervise a particular industry is not a suitable body to judge matters affecting full employment. The Board will agree, of course, with every sentiment expressed by the noble Lord, Lord Burden. The maintenance of an efficient and healthy steel industry, in itself, would make a most vital contribution to the maintenance of full employment. After all, cheap steel has undoubtedly helped the competitive position of the engineering industry in this country in its overseas markets, and thus helped to earn foreign currency to buy the materials to ensure the full employment to which the noble Lord, Lord Burden, and all of us, naturally attach so much importance. But this is already covered, I suggest, by the Board's general duty. In the last resort, only the Government can be responsible for the creation of the conditions which make full employment possible, by internal financial, economic and social policies and by agreements with foreign countries. In practice, of course, the Board could not fail to bear in mind considerations bearing on full employment. As I suggested to the noble Lord, Lord Wilmot, a few moments ago, how could the Board hope to do its duty and be concerned with a happy and efficient industry if conditions of full employment were not the aim of the Board, of the industry, and of all concerned?
I must on this particular aspect conclude by emphasising to the noble Lord as strongly as I can that, however desirable these sentiments may be (and they are), the responsibility must be the Government's. It must not be thought for a moment that by refusing—as I am afraid I am—to accept the noble Lord's Amendment on full employment, and his second Amendment, that the Board will be forbidden to have these considerations in mind. That would be the grossest distortion. I would, however, point out that the Government introduced an Amendment in another place which, in connection with the Board's general development functions, required them, without prejudice to their general duty, to have regard to any considerations relating to employment or to the national 963 interest to which the Minister asked them to have regard. That is Clause 5 (2), at which I think the noble Lord is now looking. The present Amendment is similar to that subsection, but extends it to the whole of the Board's duty. There is also the important difference that "the need for full employment" is placed upon the Board as an absolute criterion. This would be quite unacceptable, for the reasons I have already given to your Lordships. It seems to me that full employment and the national interest will principally be served by efficient, economic and adequate production, which it is the Board's general duty to promote.
There are various particular fields in which they have functions: principally development, prices and raw materials; secondarily, research, training, welfare, joint consultation, and so on. In the field of development there may occasionally be scope for the Board to take account of considerations outside the strict confines of their general duty. It was for this reason that the Government inserted subsection (2) of Clause 5, to which I have just referred the noble Lord. In the field of prices there is already power (this is in Clause10) for the Minister to override the Board in the national interest, and this provides an adequate means for the Minister to bring full employment and other national considerations into the balance. In connection with raw materials, clearly the national interest and full employment can only be served by the Board taking steps in pursuit of their general duty to see that the necessary raw materials for efficient economic and adequate production are available. In regard to the secondary matters to which I referred, it is clear again that the national interest and full employment will best be served by the Board taking such action as will best further their general duty—and their general duty includes high up on the list the well-being and general happiness of the industry.
To sum up, the Amendment in the name of the noble Lord, Lord Burden, is, I would respectfully suggest, unnecessary, because the Bill already provides for wider considerations affecting the national interest to be taken account of in connection with development and prices, and in other matters such considerations are 964 secondary to the prime consideration of efficient, economic and adequate production. It is further undesirable, in my submission, because it would look like a qualification upon the Board's general duty and would tend to blur, I should have thought, what, because of its paramount importance, should be clear-cut and well defined. That, I am afraid, is the firm opinion of Her Majesty's Government. I cannot offer the noble Lord any hope on that Amendment, any more than I can on the next Amendment which he has down and with which, since he spoke on the two together, he would perhaps like me to deal briefly at the same time.
Much of the argument I have directed towards his first Amendment applies to this one, too. This is slightly different, because it would allow the Minister to give the Board directions, whether general or specific, about the performance of their duty in the interests of full employment or for any other reason in the national interest. This Amendment is even wider and stronger than the previous one. The power which he envisages giving to the Minister would run completely counter to the Government's conception of the Board as a high-powered policy-making body, responsible in general, but not in detail, to the Minister, and through him to Parliament. Such a power would, in the opinion of the Government, seriously undermine the stature of the Board and would probably have the effect of discouraging really able men from accepting appointment to it. Therefore, I am afraid we cannot accept this Amendment either.
I would conclude by repeating what I said at first, because I think it is important that the Government should not lay themselves open to any accusation by those who may not perhaps have read this debate very carefully that they do not wholly agree with the noble Lord, Lord Burden, in the sentiments he expressed about full employment and the horrors of unemployment. Of course, we agree about that. But the Government feel that the best way of promoting the objects which the noble Lord has so rightly in mind—and which we, too, on this side of the House have in mind, as no doubt he will readily accept—is by a happy industry, and by a Board carrying out the duties with which it is charged. Those two—a happy industry and full 965 employment—must march together. But to include in the Bill the specific provisions that the noble Lord specifies in his two Amendments would, we feel, be inappropriate and would run quite counter to our whole conception of the functions of the Board, the Minister and, indeed, of Her Majesty's Government. Therefore, I am afraid I cannot accept either of the two Amendments.
§ LORD SHEPHERD
I understand from the noble Lord, Lord Mancroft, that the principal objection to the Amendment that has been moved is the desire that improper powers shall not be given to the Board.
§ LORD SHEPHERD
That irrelevant powers shall not be given to the Board. The Government do not want the Board to intervene too meticulously in the management and running of the industry.
§ LORD MANCROFT
That is true, of course; but it is not quite the point I was making. What I was saying was that this is not the function of the Board at all. That is the point.
§ LORD SHEPHERD
I am glad to know that I have been talking upon the subject which the noble Lord said is within the compass of the intention of the Government. But I would remind him of his own intervention in the debate—that whilst the Government feel unable to give us the Amendment which we have proposed, the Government themselves in another place have given authority to the Minister to authorise the Board to intervene in the subject on which Lord Mancroft said they ought not to have authority at all. I would join issue with him there, because if a body like the Board is going to overlook an industry of this kind, it has not only to consider the position of raw materials and the like but has also to consider the provision of labour and the maintenance of that labour, in the work of producing the commodities which the industry turns out. I noticed that the noble Lord indicated that, without giving this Board a simple authority to deal with the question of employment, the effect of the Board's work will be success in the industry. If you get success in the industry, he repeats, there can be no better way of guaranteeing 966 employment. If the noble Lord will look back, as my noble friend has indicated to him, at the record of this industry during the last fifty years, he will find that an industry divided against itself has been remarkable for the degree of unemployment that existed. Indeed, during the period when unemployment was rife in those industries some of the greatest fortunes in the land were made.
There is another important reason why we should like this proposal put into the clause. It may well be found necessary, as it was in the pre-war period under competitive conditions, to adopt a scheme for reorganisation for the purpose of reducing the costs of production. If that were to take place, it is on the cards that by that action there would be a turning off of a great deal of labour formerly employed. The making of an efficient industry may give rise to questions of employment and they might be as dangerous as they were then. Indeed, noble Lords opposite will remember that the National Government which existed from 1931 onwards joined with the Steel Federation of Great Britain in the reorganisation of that industry, which brought about the closing down of mills and furnaces; and the concentration of work in a fewer number of places led to the discharge of a great number of men. It is conceivable that under the new conditions some sort of reorganisation will take place. If that is the case, we suggest that it is of the highest importance that there should be some degree of authority to the Board, to have regard not only to cutting down costs but also to the provision and maintenance of full employment.
I agree with the noble Lord, Lord Mancroft., that full employment is a responsibilily of the Government as a whole on behalf of the people of the United Kingdom. If an industry is organised under Government auspices, the Government naturally have the matter under complete control. But if we are to divide up industry in the way proposed in this Bill, the Government, if a way is to be found to produce full employment, will have to do so through fie agency of those continuing the industry. It will be impossible for the Government to guarantee full employment to the people employed in a competitive industry unless the Board which this Bill proposes is given authority to have regard—and this is all our 967 Amendment says—to the provision of full employment as being one of the important principles at stake. If we have a nationalised industry it is for the Government to say what it requires in that industry. But if industry is under private enterprise, and it is still the responsibility of the Government that full employment should be maintained, then only through the agencies attached to that industry can the Government's wish and purpose be carried out.
§ 6.26 p.m.
§ VISCOUNT BRIDGEMAN
I think we may be in danger of misconceiving the attitude of the House on the question which is the subject of this Amendment. As my noble friend in front of me has said, there can be no question but that everybody in this House, irrespective of Party, wishes to do everything possible to avoid conditions of unemployment and hardship to the workers, in this industry or any other. But although one can say that with all one's heart, it does not therefore follow that that is a reason for putting words to that effect into this or that Bill.
The other thing which strikes me, not only about this Amendment but, if I may refer to them, about some Amendments which have gone before, is that a number of the Amendments proposed by noble Lords opposite seem to us to have the effect of placing upon the Board responsibilities far outside the scope of the steel industry itself, and extending into the realms of the economic conditions of this country. That, I am quite sure, is wrong. After all, so long as the economic conditions of this country are good, the steel industry, like any other industry, will be fully employed; and there is the incentive there, not only to the workers to do their best but to the employers to employ as many of them as possible. In any industry like the steel industry, where labour conditions have traditionally been extremely good, as they are now, that will work. When you get to a state of affairs such as existed in the early 'thirties, which noble Lords opposite have in their minds, you have a condition where the maintenance of full employment, in this industry or any other, is a problem reaching far beyond the bounds of the industry itself. The only way in which the steel industry can maintain 968 full employment if orders are not there is for the Government to take such action as will keep the steel mills working, by providing orders which might not otherwise have been provided. There is no other way to do it. That I am quite certain is something far beyond the capacity of the steel industry itself and, therefore, far beyond what ought to be the purview of the Steel Board, because the Steel Board is a body which has been set up to deal with the steel industry and not to deal with the political considerations outside it.
Therefore, do we not come back to this? If a situation like that arises—a situation which we all want to avoid—is that not a matter for the Government of the day, and have not the Government of the day proper powers in the Bill itself? In Clause 5 (2)—a clause which I think was slightly misquoted by the noble Lord, Lord Shepherd—the important feature is that the Minister may ask the Board to take into account any circumstances which he, the Minister, should take into account. In those circumstances, surely we include any such circumstances as might arise from the sort of national crisis which noble Lords opposite have in mind.
§ LORD SHEPHERD
May I intervene? I was not misquoting, as the noble Viscount suggests. I was merely indicating that the noble Lord, Lord Mancroft, had said that the Board was the wrong institution to be given such powers, whereas in the subsection now being quoted by the noble Viscount, the Minister has the right to give them such powers, and I could not see how it was possible to square the two.
§ VISCOUNT BRIDGEMAN
I think they square perfectly well. The Board should not have power themselves to deal with economic difficulties outside the industry. The Minister should certainly have powers to ask the Board to take into consideration any matters to which he thinks they should have regard. Surely that would apply to the matter of full employment, or, if the worst came to the worst, to unemployment. I feel that this problem of unemployment is one which is well taken care of in the Bill, and I think we should be wise not to try to impose on the Board powers which go far outside their real business, which concerns the steel industry itself.
§ LORD LAWSON
I apologise for the fact that I was not here to move this Amendment, as was originally arranged. The noble Viscount, Lord Bridgeman, has just said that this is a matter to which the Government, and not the Board, should have regard. One of the outstanding problems in the last war was that in most of the heavy industries (I am fairly familiar with the heavy industrial areas) no notice whatever was taken by the privately run industry of the need for conserving a strong esprit de corps among the skilled workmen particularly, to say nothing of the unskilled workers in the great industries.
§ VISCOUNT BRIDGEMAN
I am sorry to interrupt. Surely, the words that the noble Lord has just used, to the effect that no steps were taken by heavy industry to preserve an esprit de corps, were rather strong and very sweeping. I do not want to take up the time of the House, but I should like to give the noble Lord afterwards several instances of cases in which that was done. We must not allow it to go out of this House unchallenged that no steps were taken.
§ LORD LAWSON
I had in mind 1939. As a matter of fact, in the shipyards the most outstanding factor was that if it had not been for the "phony war" we should have been in a very bad situation indeed, because not only skilled but the great corps of unskilled men—known as "black gangs"—had to leave the shipyards. It was a well-known fact that they were dissipated in the most alarming way, so that they could not be found when they were wanted. We did manage to pick up some of the older men and get a kind of "scratch" gang together to deal with the situation. But as I say, had it not been for the "phoney war" at that time, we should have been in a very difficult position indeed. I know this for myself: I speak with knowledge of the matter.
It is also a well-known fact that these men, who were dissipated and dispersed all over the place, were doing jobs that were little better than making dolls' eyes—at the very time that the Government were crying out for them. I should have thought that that industry, upon 970 which the country is so dependent, is an outstanding instance and a living proof of the fact that there mast be some relation between these Boards and the Government of the day, so that the men can be sure that they are not being let down. I will not detain the House, but I could speak at considerable length on this matter, because I was deeply involved in the special areas in the North. I remember how heartbreaking it was to see highly qualified men from the shipyards and heavy industries practically driven away. It fact, I myself had to get them away to get them jobs, to industries that were certainly not worthy of this country, considering the high degree of skill of these men. There should be some close contact between the Boards of nationalised industries or semi-nationalised industries—call them what you will—and the Government; and it is essential that the Government should know what is the state of things in the industry, and that the industry should know exactly what is the policy of the Government of the day.
§ LORD SILKIN
I think it is a great pity that the Government have decided not to accept either of these Amendments or anything which resembles them. It seems to me that the reasons given by both the noble Lord, Lord Mancroft, and the noble Viscount, Lord Bridgeman, take little account of the actual wording of these Amendments. As I understand it, the reason given is that it is not the job of the Board to concern itself with full employment, but that that is a matter for the Government. I accept fully the fact that this Government, as indeed any Government in modern times, have to concern themselves with the problem of full employment. No Government could live long in these times unless that was one of their dominating concerns. Therefore, I am not making the slightest imputation against the Government, or suggesting that they are indifferent to the question of employment. But it seems that the reasons given are involved in the doctrine of good government—that this is a matter with which the Government must concern itself and not one on which the Board either has the information on which it could act or could properly act, even if it had the information.
971 Now let us look at the Amendments and see what they say. The first says that the Board shall have regard to these matters and:…to any other considerations relating to the national interest to which the Minister may have asked them to have regard.In other words, they are not asked to take the initiative themselves. According to the Amendments—orat any rate according to the intention of the Amendments—they would concern themselves with the question of employment only when they are asked by the Minister to do so. But the second of the two Amendments is even stronger, because it gives the Minister power at any time to give to the Board—he may: he is not obliged—directions as to the performance of their duty to secure full employment.…
§ LORD MANCROFT
The noble Lord keeps on saying "full employment." He would be more revealing if he were to read the remainder of the wordsin Great Britain.The Amendment does not say "here and there" or "in this industry or that": it says "full employment in Great Britain."
§ LORD SILKIN
I prefaced my remarks, as I would on any Amendment, that it may well be that the wording of the Amendment is capable of improvement.
§ LORD SILKIN
Well, it was so even in the days when the noble Lord and his friends were in Opposition. We have not a skilled draftsman at our disposal, and it is conceivable that frequently we could be tripped up on words. But nobody is out to trip us up, I am sure, on the literal wording of our Amendments—though we are entitled to do it to the Government, because they have got draftsmen. If the noble Lord or the noble Viscount understands this Amendment to mean that a Board concerned with operations in iron and steel should deal with full employment throughout the country and in every industry, of course, I would agree with what they have said in their criticisms. But obviously that is not the intention—and none of the speeches in support of the Amendments lends colour to that interpretation. My noble friend Lord Lawson, for instance, dealt specifically 972 with unemployment in the iron and steel industry; and so did my noble friend Lord Burden. And that industry is, of course, what we are talking about. So I say that, if that is to be regarded as the intention of the Amendment, the second Amendment makes it quite clear that what we are asking is that the Minister shall be in a position, if he so desires, to give directions to the Board to have regard to these questions. Why not? Questions will arise as to whether or not a particular concern should be closed down. As the Bill stands at present, the Board will have regard to questions of efficiency, questions of price and so on—the various considerations are set out in the Bill. Why should not the Minister have the right to give a direction asking the Board, in addition to the considerations that are already set out, also to have regard to the question of the employment of the industry? After all, it can be a very serious matter.
Let us take, as an example, the question of the new town of Corby, where vast sums of public money are involved in the building of a new town, and where people have been recruited from all over the country for the purpose of employment by Stewart and Lloyds in this industry. Supposing that there were some suggestion—it may be fanciful—that something should be done in connection with Stewart and Lloyds, that they should be slowed down or that the industry in that area should cease altogether, this would have repercussions upon tens of thousands of people. Eventually, the new town will be a town of something like 80,000 people, nearly all of them directly concerned with this industry. Is it to be suggested that the Minister or the Board should have no concern at all with this; that they should make their decision on the question of what should happen at Corby merely on the ground of "the efficient, economic and adequate supply of iron and steel products," without regard at all to the social capital that is involved in the creation of the town of Corby and without regard to the welfare of the individuals who are employed in the industry? All that this Amendment seeks to do is to give the Minister power in a proper case, within his own discretion to give a direction to the Board—does the noble Viscount, Lord Davidson, wish to say something?
§ VISCOUNT DAVIDSON
Only that under Clause 5, subsection (2), that is fully provided. May I read it?Without prejudice to the promotion of the efficient, economic and adequate supply of iron and steel products, the Board shall, in their consultations under the preceding subsection, have regard to any considerations relating to employment in Great Britain or otherwise relating to the national interest to which the Minister may have asked them to have regard.Surely that is it?
§ LORD SILKIN
I admit that that goes part of the way, but the second Amendment, at any rate, goes much further, because it enables the Minister to give a direction to the Board on this subject. It is a much stronger Amendment; it is a much stronger provision, and it is of a much more general character. Of the two Amendments, if I had to choose between them, I think I should prefer the second. Just as noble Lords opposite were anxious to keep in the Bill the words "under competitive conditions," as a demonstration that it was important to have competition in this industry, so I think it is desirable to have the strongest possible words in this Bill to indicate that employment in the industry is something with which we are deeply concerned, and that it is to be one of the important factors in the functions of the Board when asked by the Minister to have regard to it. For those reasons, while I would not at all pledge myself to the exact wording of either of these Amendments, I hope that the Government will see their way to reconsider the matter between now and the next stage, with a view to giving us something which will be a declaration of their intentions as regards employment.
§ LORD LAYTON
May I ask the noble Lord who has just sat down whether he does not regard Clause 5, subsection (2), as mandatory on the Board? Because the Bill says earlier on that the Board shall have regard to considerations to which the Minister may have asked them to have regard. Is that any weaker in direction? It seems to me, if I may say so, that that subsection has identically the same mandatory effect as the second of these Amendments, and that as between the two the only difference is that the Amendment now being moved covers all the functions of the Board, as distinct from production facilities and raw materials. As the Government have 974 accepted the principle in subsection (2) I do not see any clear reason why they should not do so for the whole of the functions of the Board.
Surely the difference is that what we are trying to consider and do in our Amendment places the onus on the Minister. It is permissive for the Minister; it gives him the right; he may act at any time if he thinks the Board is not paying enough attention to these questions. I think the noble Lord, Lord Silkin, supports me there and will probably be grateful to me for answering the noble Lord, Lord Layton.
I have taken the opportunity to do so because I want also to say a word on the general principle. In these debates, noble Lord after noble Lord arises from the other side of the House, figuratively lays his hand on his heart and says, "Whatever happens, we are going to fight and struggle to keep full employment for the workers of Great Britain. Any other suggestion is unfair to us, unjust, libellous and all the rest of it." That is what they are saying, and I am sure they are meaning it. That is within the precincts of this Chamber. But what happens outside? Their supporters, or a very large proportion of their supporters, are business tycoons who provide the great sinews of war for the Conservative Party, who are the driving force of big business in this country and who believe that full employment is not in the best interest of their particular system.
§ SEVERAL NOBLE LORDS: Shame!
As I said, by many of the great leaders of industry, or the leaders of the great industries in this country, who believe that full employment means slackness on the part of the workers, too strong trade unions, and that it would be to the advantage of the country—and they are quite cynical about this—from time to time to have a good dose of unemployment.
It is not monstrous. Does not the noble Lord know what is being said outside this House? I do not know what he does with himself in his spare time.
These things are being said and are being written in papers like the Economist.
Now let me come to the actual proof of what happened in the past. We can read from history. I see the noble Viscount, Lord Davidson, who is one of those who protest that of course the last thing the Conservative Party want to see is anything but full employment. He occupied a very important position in the Governments which followed upon the First World War, when we had a deliberate and considered policy of deflation and the throwing out of work of large bodies of men for deflationary purposes, followed by tremendous industrial troubles, strikes and lock-outs which caused great injury to this country.
Now we have had the second Budget of the present Chancellor of the Exchequer. I do not want to go into the details of that because I presume that in due course it will come before us in the ordinary way, as a Finance Bill. The second Budget of the present Government is a gamble. It is hoped that it will keep things on an even keel. It is hoped that it will give a certain incentive towards increased business efficiency, and so on. But it may easily fail. Half a dozen factors may upset it. What is the alternative then? The alternative then is a good dose of deflation, the throwing out of work of great numbers of men as a consequence, the lowering of wages and the standard of living in that way, and an attempt to bring about a balance in our economy exactly as was done after the 1918 War. I do not say that the noble Viscount, Lord Davidson, had anything to do with it at the time, but he was a prominent member of the Government which was ultimately responsible and which listened to the promptings and advice of the then leaders of the City of London and the great industrial leaders of the country.
What happened has been explained by my noble friend Lord Lawson, speaking from his great experience as a trade union leader. He saw it happening in the North of England. I, as a member of 976 Parliament, saw it happen. He saw it as a great trade union leader. It is that sort of thing which we are hoping to prevent, by any means we can, because in the long run it is bad for the country, bad for the nation and particularly bad for the working people. Whatever our shortcomings on these Benches, we try to speak in what we think are the interests of the great mass of the workers of the country. We think that words of this sort are necessary and desirable, and we all regret very much that the Government cannot accept them, or at any rate propose some alternative form of words which will fulfil the same purpose.
§ LORD WINSTER
This House will certainly be a vastly entertaining place if we occupy our speeches with saying how we spend our spare time, but it might not in every case conduce to our reputation with the outside public. I hope the suggestion will not be generally adopted.
§ LORD WINSTER
I do not look around always making reflections or to see that reflections are implied; I leave that to others to do. But I should like in one or two words to support what was said by the noble Lord, Lord Lawson, about the effect in the shipbuilding yards of the dreadful unemployment which took place in the steel industry. That was a really dreadful period in the industry. But it is over, and it is no good going over it except to draw one or two useful conclusions from it. Certainly, at the Admiralty in the early stages of the war I had the opportunity of knowing how unfortunate were the effects in our shipyards of the withdrawal of labour from the shipyards which followed upon unemployment in the steel industry. Undoubtedly, we were put to very great straits on that account, and suffered severely in more than one respect.
On the subject of the Amendment I should like to say this. The Explanatory Memorandum to the Bill says that it provides for the return to private ownership of the undertakings in question. Well, I should have liked to see the Bill accept the fact that private ownership must have close regard indeed to employment. I think it would be unfortunate, by way of contrast, to say that 977 a nationalised industry pays close attention to employment or full employment, but that when the industry is returned to private ownership that consideration is, to some extent, lost sight of. I should have thought that the Government would be very anxious indeed to connect that statement in the Explanatory Memorandum, that the Bill provides for the return to private ownership, with something in the Bill to show that private ownership will have this close regard to employment or full employment. I should have thought it would be a very good advertisement for the Government in regard to what they are doing, and I am very surprised that they have not taken that opportunity. I hope I do not misunderstand the noble Lord, Lord Mancroft, but I thought that at one time he took exception to the words "Great Britain" in the Amendment. I do not want to misquote him in any way at all—
§ LORD MANCROFT
I did not take exception at all. I merely asked the noble Lord, Lord Silkin, when he was referring to the Amendment, to read it out with the words "Great Britain"—not that I take exception to them, but merely to get the constant reiteration of the words "full employment in Great Britain." I was only making the debating point that full employment in Great Britain was outside the scope of the Bill; but if it was a question of full employment in the industry, then I was arguing that the best way of obtaining full employment in the industry was by the Board carrying out its functions in order to obtain a happy industry.
§ LORD WINSTER
I quite understand. I am sure my noble friend will agree that to some extent the wording is irrelevant, provided the Amendment takes into account this question of having regard to full employment. In that regard I think we should be quite amenable, as far as the meaning is concerned.
Two other points have occurred to me. If we look at Clause 2 (3), we find there a reference to the Board having regard to organisation and administration, and then, again, in Clause 3, we find that the Board has to have regard to training and education and to welfare. The Board is charged with those responsibilities for looking after organisations and administration, which I should think concerned very closely indeed the matter of employment, 978 and also training, education and welfare. But what is the need for training and educating your workers and having regard to their welfare if it does not extend to having very close regard indeed to their employment? I should have thought that it was implicit in those directions to the Board, and that therefore the Government could have no possible objection whatsoever to mentioning the question of employment in connection with the duties of the Board. Finally, I would say that in many places throughout the Bill and throughout the directions to the Board reference is made to the Board's doing things in the national interest. I must confess that I have difficulty in understanding what could be more in the national interest than establishing a happy and contented labour force in this great industry, through having due regard to the full employment of the labour force.
§ VISCOUNT DAVIDSON
I should not have intervened except for a very few moments, had it not been that Lord Lawson has arrived in the Chamber. I know what a passionate interest he took in the employment of his people in the North before the war. He knows that when I was in another place I also had occasion to take a very keen interest in unemployment, or rather in the cure of unemployment, if that were possible. But in relation to this Amendment, as it seems to me, the point is a very simple one. It is that the Board, as an industrial body, will be staffed by people who are experts in their particular walk of life: management and labour, and the consumer of steel goods and other independent persons. It is inconceivable that they should not be interested in employment in the industry which they supervise. Therefore, I think the only result of accepting this Amendment would be to take out of the hands of the Government their responsibility for full employment. It could not possibly be a function of a Board restricted in their supervision to one industry. That is why I hope the noble Lords across the floor will withdraw their Amendments.
§ 7.0 p.m.
§ THE MARQUESS OF SALISBURY
Perhaps I may say a word in conclusion. We have had, I think, an interesting and valuable debate on these Amendments. I regretted the intervention of the noble Lord, Lord Strabolgi, who did not seem 979 to me to heighten the general standard. I have long known him to be an adept at what I may call slinging mud in the hope that some of it may stick. I should have thought he was old enough to realise that in the long run that hurts nobody but himself. It is not going to have the slightest effect on the Conservative Party. Everybody knows that what he said is not true. It has a bad effect on himself. Certainly the making of reckless statements of that kind, for which he did not produce any evidence at all, has an effect on his reputation in the country and in the House. His reputation as an accurate speaker in this House is his affair, and I do not propose to take it any further, but I should like to repeat that it seems to me to be absolute insanity to say that either the Conservative Party or any other Party should want unemployment for its own sake. There was a long slump, which was world wide and not confined to this country, and unemployment was at least as high at the time when the Labour Party were in office as when we were in office. I do not think the Labour Party were entirely responsible for that. I would be the last person to suggest such a thing. It was something much bigger than any purely British Government could tackle at that time. To suggest that we were responsible is equally wrong.
After all, there is every reason why any Government should want the working people to be employed. First, there is the obvious reason, which I think is common to us all and which was mentioned by the noble Lord, Lord Lawson, that unemployment is in itself a dreadful and a degrading thing to people who are unemployed for a long time. I should not have thought that any responsible person in any Party would desire such a situation as that for his fellow countrymen. Even if we were not humanitarian and were purely hard-boiled businessmen or economists, or whatever it may be, we should have thought it deplorable from a purely economic point of view. A man who is unemployed is unproductive; he is not playing his full part in increasing the general wealth and prosperity of the country. From that point of view, equally, it is undesirable that men and women should be unemployed. Therefore I think we can take it that it is generally accepted in all parts of the 980 House that everybody of a responsible character, in whatever Party he is, wishes to see the working people of this country fully employed. I think that is common ground, and I do not believe that anyone, except the noble Lord, Lord Strabolgi, would disagree with it.
Now I come to the Amendments themselves, which I am sure are sincerely designed to bring about that result, or anyway to help towards that result. My case has already been put by my noble friend Lord Mancroft and others. However well-intentioned the Amendments are, they still seem to me, after I have listened to the whole of the debate, to be an attempt to give the Board a responsibility for matters which are really outside the scope of the iron and steel industry alone. Clause 3, which we have been discussing, deals with the supervision of the iron and steel industry. It is concerned with increasing the productive capacity of the industry and with no other purpose whatever. As my noble friend, Lord Davidson, has just pointed out, unfortunately one cannot confine unemployment to the iron and steel industry or even consider unemployment in the iron and steel industry by itself. It is a much larger question, which can be tackled as a whole only by the Government.
I do not think a reference to unemployment would be appropriate in Clause 3, and here I come to the point very properly raised by the noble Lord, Lord Layton. If we turn to Clause 5 (2) we see that almost exactly the same words as those in the noble Lord's Amendments are already in the Bill. The subsection reads:Without prejudice to the promotion of the efficient, economic and adequate supply of iron and steel products, the Board shall, in their consultations under the preceding subsection, have regard to any considerations relating to employment in Great Britain or otherwise relating to the national interest to which the Minister may have asked them to have regard.That seems to me exactly what noble Lords opposite want, and I think the words are properly placed where they are. I do not think this Amendment would be in its proper place in Clause 3, and I could not give the noble Lord any assurance that we would put it in Clause 3. It is there in the Bill and that is what the noble Lords want. I should have thought they would be satisfied with that.
§ LORD WILMOT OF SELMESTON
I rise at this point only to say that I think the noble Marquess was unwittingly unduly severe in his strictures upon my noble friend Lord Strabolgi. Let me say why I think so. If I heard my noble friend aright, he had no intention of imputing to noble Lords opposite any such foolish thought as that they would welcome unemployment. I cannot believe that any Member of this House would have such stupid thoughts at any time. What my noble friend said was that some commercial people do say that they think perhaps it would be an advantage if there were a modicum of unemployment. We are men of the world; we mix with commercial characters, and which of us can say that we have never heard anybody say that? Of course, it is exceedingly foolish. It is a doctrine which was exploded long ago, and all of us now realise the truth of what we were told by Maynard Keynes, among others: that what we can do we can afford to do—one of the greatest truths that was ever said; and I am sure everybody realises that. But there are ignorant people who have not learned that lesson, who think that costs would come down and wages would come down, and that the trade unions would be less belligerent if there were a little queue outside the Labour Exchange—not a long queue, that would affect the market very much, but one long enough to affect the temper of the belligerent unionists. We know that such talk is stupid, and I am sure that neither my noble friend nor anybody else on this side of the House would be so foolish as to think that any Member of the House versed in the conduct of public affairs would be likely to join with such foolish people in holding these views.
§ THE MARQUESS OF SALISBURY
When I was at Geneva, in the days before the war, there was a process known to the League of Nations as "the reinterpretation of affairs." I think the noble Lord, Lord Wilmot, has given an. extremely agreeable and absolutely brilliant reinterpretation of the speech already made by the noble Lord, Lord Strabolgi, but I beg him to read the two speeches to-morrow morning and see whether they look exactly the same.
As the noble Lords who have wound up the debate have referred to my speech, I shall take advantage of that fact to make one further comment. The noble Marquess, Lord Salisbury, the noble Viscount, Lord Swinton, and others were prominent in the Government of this country between the wars. They will remember the extremely injurious policy pursued by the then Conservative Government, in which the present Prime Minister was Chancellor of the Exchequer, when, in order to make the pound able to look the dollar in the face, we had a deliberate policy of deflation, a deliberate raising of the value of gold. We then, prematurely, went back on to the gold standard, and the result was the dislocation of our labour markets and tremendous a unmployment. In effect, the Government did not care about unemployment, which went up and up. So long as we could go back on to the gold standard, in the most foolish way, for a ridiculous question of prestige, then the consequences could follow. That happened between the wars. We do not want to see anything like that happen again. The present Government, with their narrow majority, are not trying to do that; but there may be other circumstances and conditions; and "when the devil is well" the devil again will be a devil.
§ LORD LAWSON
I am sorry, but I cannot withdraw this Amendment. I feel that the only way of handling this matter is to lay the full responsibility squarely on the Board.
§ On Question, Amendment negatived.
§ THE MARQUESS OF SALISBURY
Before we go on to the next Amendment, perhaps I may say a word about the business of the House. I had hoped that we should have got a little further forward than we have to-day. However, we do not complain; we have had valuable discussions which have served to clear our own minds and the minds of others. We did agree that we should stop at seven o'clock, and it is now quarter-pasts even. In the circumstances, I do not think it would be worth while to start another rather controversial Amendment. Therefore, I suggest, it is agreeable to your Lordships, that we should now adjourn the Committee stage. I only hope that it may be possible for us to make 983 rather more rapid progress to-morrow. If we do not, I suggest that noble Lords should so make their arrangements that we might sit a little later, if necessary. Having said that, I now move that the House do resume.
§ Moved, That the House do now resume.—(The Marquess of Salisbury.)
§ On Question, Motion agreed to, and House resumed accordingly.
§ House adjourned at a quarter past seven o'clock