Lords Sitting of 18 December 1956

Preamble
The House met at half past two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers

BRITISH CONTRIBUTION TO JORDAN
2.35 p.m.
LORD BARNBY: My Lords, I beg to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government if they will state whether any change has recently taken place in the annual contribution to the State of Jordan, and on what annual amount contributions, if any, are being currently made.]
THE MINISTER OF STATE FOR FOREIGN AFFAIRS (THE MARQUESS OF READING): My Lords, no change has recently been made in our annual contribution to Jordan. This falls under two heads: first, the subsidy to the Jordan Arab Army and, secondly, other financial assistance for defence purposes. The level of the latter was agreed at £1,100,000 for the current year, and, of this, £1,000,000 has already been paid. The level of the subsidy during the current years, however, has never been agreed with the Jordan Government. Meanwhile, monthly issues have been, and are for the present being, made on the basis of the agreed total subsidy of £9,108,000 paid by Her Majesty's Government in 1955–56.
LORD BARNBY: My Lords, I thank the noble Marquess for his reply. In view of the information given in another place, I would ask him whether, in the case of an ordinary commercial transaction entered into between two parties, involving payments of a regular character, if one party unilaterally acts in a way which seems to impair the agreement, it would not be natural that payments should be suspended.
THE MARQUESS OF READING: My Lords, this is not a commercial transaction; it is a Treaty obligation. As regards the position with Jordan, they have not

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unilaterally denounced the Treaty; they have told us that they propose to ask for negotiations with a view to its abrogation.
LORD KILLEARN: My Lords, am I right in believing that, in his original reply, the noble Marquess emphasised the words "at present"?
THE MARQUESS OF READING: My Lords, I do not know whether I emphasised them, but they were contained in my reply.
LORD BARNBY: My Lords, is the noble Marquess in a position to inform the House whether the interpretation which he has put on this transaction, from the point of view of the responsibility of the British taxpayer, is in accordance with the view held by the Treasury Solicitor?
THE MARQUESS OF READING: My Lords, I am not in a position to say that, because I am not in a position to say what are the views of any civil servant. I am here as a Minister to express the Government's view.

MERSEY TUNNEL LIGHTING
2.39 p.m.
EARL HOWE: My Lords, I beg to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether any steps can be taken to improve the lighting arrangements of the Mersey Tunnel and to bring the lighting regulations for the vehicles making use of this great artery in line with the regulations governing the use of other great road tunnels in Europe and America.]
LORD HAWKE: My Lords, the lighting of this tunnel and the by-laws relating to the lighting of vehicles in the tunnel are the responsibility of the Mersey Tunnel Joint Committee, and my right honourable friend the Minister of Transport and Civil Aviation has no power to intervene. No complaints about the standard of lighting have been received by the Minister, but if my noble friend has any further information to offer, the Committee will be asked to consider the matter.
EARL HOWE: My Lords, I thank the noble Lord.

SUEZ CANAL CLEARANCE
LORD CONESFORD: My Lords, I beg to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether the General Assembly of the United Nations has yet recommended that the task of clearing the Suez Canal should be subject to the orders of Colonel Nasser; and whether such a recommendation would make the theory correspond with the practice.]
THE MARQUESS OF READING: My Lords, the Answer to both parts of the noble Lord's Question is, No.
LORD CONESFORD: My Lords, I thank my noble friend for that Answer. If it is not the orders of Colonel Nasser that is preventing the use of the Anglo-French salvage fleet, what is it? What is the reason for the fantastic delay and for the foolish proposals made by the United Nations and its agents? Is it incompetence or malevolence?
THE MARQUESS OF READING: My Lords, this is an urgent matter, as the House knows, and difficult negotiations are at the present moment going on. My right honourable friend the Foreign Secretary made quite a full statement upon the position yesterday, and I hope that, in view of the urgency and importance of these negotiations, the House will accept it when I say that I do not think I ought to add to what my right honourable friend said.
LORD HENDERSON: My Lords, in view of what the noble Marquess has said— and we all agree on the urgency of the clearance of the Canal—is it not as wrong for Colonel Nasser to impose any obstruction to the clearance of the Canal as it would be for Her Majesty's Government to refuse to make available the clearance resources and facilities which they have made available?
THE MARQUESS OF READING: My Lords, I do not in any way disagree with the position the noble Lord, Lord Henderson has put. But, of course, this is not an operation carried out by Her Majesty's Government; it is an operation that is being carried out by the United Nations.
SEVERAL NOBLE LORDS: Or not carried out.

HYDROCARBON OIL DUTIES (TEMPORARY INCREASE) BILL
2.42 p.m.
Order of the Day for the Second Reading read.
THE CHANCELLOR OF THE DUCHY OF LANCASTER (THE EARL OF SELKIRK): My Lords, I think that it would be an exaggeration to describe this as a popular Bill. None the less, the reasons which have convinced my right honourable friend the Chancellor of the Exchequer that it is in the interests of our economy that additional duty should be placed on oil have not been effectively rebutted in the course of the discussions which have taken place so far. I think that we can all meet at a point of common agreement—that is, the need to maintain confidence in sterling. Indeed, we should be an unworthy nation, whatever position we were in, if we did not put this question in the forefront of our thoughts. No doubt, the fall in the value of sterling (and I am glad to say sterling has recovered recently) has been due to a large extent, to international tension, and I do not pretend that Bills such as this can do much more than make a certain contribution. None the less, this contribution is important, because it shows that we are determined to restrain any inflationary pressures that may arise through the inevitable increase of purchasing power arising from a reduction of oil consumption in this country.
This Bill, therefore, is a continuance of the policy of restraint on consumption which, in the last eighteen months, no one can deny, has achieved a certain measure of success in stabilising the level of retail prices and improving our balance of payments. The other side to the same point is, of course, the reduction in oil consumption which would produce a reduction in revenue. This would mean that the surplus above the line would be reduced by that amount; or, alternatively, the overall budget deficit—that is, above and below the line—would be increased.
It may be argued that these points could be met by spreading the tax more widely over other items. Indeed, the Chancellor of the Exchequer said specifically that he had examined a wide range of other possible sources of tax, including income tax. It proved, however, impracticable
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to make any alteration in income tax so late in the year.
But, it was, after all, logical that supplies of a material so valuable as oil is at the present time should be guarded, not only by rationing but also by putting up the price. In a sense, of course, all indirect taxes, by raising the price of what is taxed, have some effect on the amount bought. This has been done by all parties. Dr. Dalton's taxes on tobacco, Mr. Gaitskell's taxes on petrol, are perfectly simple examples of it. Nevertheless, the bare fact is that tax MI petrol is very widely spread, because there is virtually nobody who does not use petrol in one form or another. Though I should be the first to admit that some people use it more than others.
The effect of rationing and price will necessarily make everyone very careful of the manner in which he uses feel, and its effect on the retail index can very easily be exaggerated. Taking tax and rising prices together, the effect is about 1s. 5d. a gallon. If we take passenger transport, by car and bus, that should amount to perhaps rather less than one-half of a point increase in the retail index. It is, I think, important to remember two points: first that this tax does not apply to fuel oil; and secondly, that it is temporary in character. This latter point, I would emphasise, is clearly laid down in Clause 1 (2) of the Bill. The additional tax will automatically come to an end within one month of the -termination of petrol rationing.
To turn to Clauses 2 and 3, it has, I know, been argued that these two clauses could be brought within the explosive epithet of "tacking". And, although this is a Money Bill, these two clauses, in fact, cut right across existing procedure and deal with a subject which, strictly speaking, has nothing whatsoever to do with taxation. That is perfectly true. But both clauses are a necessary and, it would seem, an inevitable consequence of the first clause, unless it is to operate in a manner that is grossly unfair to certain operators of vehicles. Clause 2 enables bus operators to offset the increase of this duty by increasing fares. They may do so by offsetting to a gross amount of one-twelfth of their existing fares, or one-eighth in certain cases where services are

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substantially rural and with a limit of 50 vehicles, or where the firm is operating only five public service vehicles.
I think I should make it clear that within the limits of one-twelfth or one-eighth, as the case may be, taking all the factors into consideration, the operators may increase their charges in a manner which at least will go some way to meet the increased price of oil. This increased price is, of course, affected both by the emergency surcharge which the oil companies have found necessary to impose to cover the additional cost of bringing the oil here and by the increased duty. It is important that this fact should be clear both to the operators, to the Transport Tribunal and to the traffic commissioners.
Increases in prices arising from these two sources are to be dealt with under the procedure laid down in the Bill, and in no other way— that is to say, they are not to be considered as a basis on which increased charges of a more permanent character should be agreed to, either by the Transport Tribunal or by the traffic commissioners. It is true that they are entitled to make this increase according to the best of their judgment. This means that, in effect, it will be virtually impossible, or certainly very difficult, to attack the decision which is reached in the courts of law. There is no doubt that this does give public service vehicle operators a limited freedom of action for a certain period. But it is limited, not only in amount, as I have already explained, but also in time, because these charges must come off within a fortnight of the time when the duty ceases to be paid. Moreover, I should have thought it would not be in the interests of the bus companies, on a short term, to alienate their clients by taking some action which might appear to be unfair.
Similarly, in Clause 3 an abbreviated procedure is provided for increasing the charges of provincial taxicabs. This increase is limited in amount, and is not to exceed the sum of 6d. on any one journey. It is also limited in time, for it is to be in force no longer than a fortnight after the date when the duty comes to an end.
My Lords, we are in a difficult and disagreeable position, but I would submit to the House that this is the right and
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proper way of tackling this problem. And the consequential provisions arising from it are both practical and reasonable, and it is for that reason that I would ask the House to agree to them. I beg to move.
Moved. That the Bill be now read 2ª.—(The Earl of Selkirk.)
2.50 p.m.
LORD LUCAS OF CHILWORTH: My Lords, this is a thoroughly bad Bill, presented to your Lordships in a thoroughly bad manner. May I hasten to say that that is not a personal comment upon the noble Earl who has introduced it. He has made the apologia that this is an abrogation of the rights of your Lordships' House. This is certified as a Supply Bill, when only the first clause is connected with Supply. I would agree with the noble Earl that the other clauses are ancillary, but this measure should have been presented to your Lordships' House in two Bills, and not one. Then your Lordships' House would have had the opportunity of carrying out its statutory right and duty to amend the Bill, or at least those provisions which are not connected with Supply. As it is, your Lordships cannot do it. You have to pass this Bill whether you like it or not, and you have no chance whatever of offering any Amendment to any provision in this Bill which does not affect directly the supply part of it, which is contained solely in the first clause. Upon that issue I raise a protest, because I do not think it is a right and proper way to treat your Lordships' House— though I recognise it may be expedient. That is why I say that the Bill is presented to your Lordships in a thoroughly bad way.
It is a thoroughly bad Bill because, as the noble Earl admitted when he made his speech, it is only rationing by the purse, coupled with rationing by the coupon. If the Government were so disgusted with the organisation of the Ministry of Fuel and Power that they could see their rationing scheme breaking down in chaos, and thought they would have another one, I might agree with the noble Earl. But, believe me, this scheme is not going to do one of the things which the noble Earl has claimed for it. It will make no contribution to the confidence in sterling. Indeed, in my view it will have the reverse effect; and, as I propose to tell your

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Lordships, in my view and in the view of those who are in a position to judge, the consequences will be dire.
Again, in my view there was no necessity whatsoever to do as the Chancellor of the Exchequer said, and buttress up this precious liquid. When the Chancellor of the Exchequer was asked in another place what loss of revenue these proposals would cause, he named a sum of £ 6 million over a period. But he hurriedly went on to say, "Of course, the overlying Budget surplus will still be substantial." It has not yet been contradicted that the anticipated above-the-line Budget surplus will be approximately what was estimated, £ 460 million.
THE EARL OF SWINTON: Below the line.
LORD LUCAS OF CHILWORTH: Below the line. In order to buttress the confidence of sterling we have to add— what? Perhaps the noble Earl will tell me, because I do not know. But at least it is at the rate of about £30 million every four months. I am afraid that the economic consequences of this step are going to be serious, as I hope to prove to your Lordships' House.
The noble Earl has said that the economic arguments of the Chancellor of the Exchequer have received no rebuttal. I am going to make an attempt to rebut them. From all the spokesmen who have so far mentioned this matter on behalf of the Government, including the noble Earl, Lord Selkirk, all we have heard is that it may put up the cost of living by half a point, and that it will have no inflationary effect. If the noble Earl will forgive my using the expression, what a lot of complete and utter nonsense that is! If the Treasury economists, and some of those theoretical economists outside the Treasury, would cease to amuse themselves with the manipulation of digits, would learn a little commercial economic sense and acquire a knowledge of human nature, and not treat the taxpayer of this country like a species of battery hen, to be put into a battery and squeezed and squeezed until he has laid the approximate quota of taxable eggs and then have his neck wrung, they would realise that this can and will be one of the most inflationary actions that has been taken in this country.
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It does not stop with the shilling—that is an easily calculable thing. Look at all the things that it brings in its train. It is a futile argument and indicates a lack of knowledge of human nature not to expect small and medium sized businessmen, who have sunk their all in their business, and who see the size of their business reduced by 50 per cent. overnight, to fight with every weapon they can put their hands on for their self-preservation. I wonder whether the Chancellor of the Exchequer or the noble Earl would agree with the economics of the London Passenger Transport Board. May I have the noble Earl's attention, because I am on a very serious point, to which at some later stage I want an answer?
THE EARL OF SELKIRK: I am sorry.
LORD LUCAS OF CHILWORTH: When the Chancellor of the Exchequer and the Minister of Transport spoke in another place they commended the action of London Transport in not increasing their fares by more than one-twentieth, instead of the allowable increase that is provided in this Bill of one-twelfth of their gross traffic receipts. The following day, a letter appeared in The Times, over the signature of Mr. Robbins, the Chief Public Relations Officer to London Transport, and he gave some of the reasons why the costs of operating a business such as London Transport must be much more than that covered by the shilling per gallon of increased taxation.
He gives in this authoritative statement by London Transport a great many figures. He says that the extra cost of oil will cost London Transport £ 40,000 a week, and that the delay in putting this increase into operation will cost them a backlog of £ 150,000. He goes on to give some of the reasons why 't is necessary, to spread the increased charge, not only over London's buses but over London's underground railways, which, of course, are virtually unaffected by the increase of this Is. in the gallon on petrol. He states, among other things:
"it will cost more to carry the additional traffic,"
for private motoring, being limited, will go on to the buses. And he says:
"We have undertaken to maintain the peak hour services, and in fact we shall probably have to increase them. This will be expensive; on the Underground we shall have to keep

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long trains running throughout the day; this will also cost more money. To make the 5 per cent. reduction of bus mileage required by the Government we must cut services outside the peak hours and on Sundays. This enforced unbalance of our traffic may well offset the additional takings.…
Mr. Robbins goes on and finishes in this way, which may amuse some of your Lordships, though it can be an economic argument—it certainly made me smile when I read it. Talking about the halfpenny increase, from 2½d. to 3d., on the minimum London bus fare, he says:
"A difference of so little as a halfpenny causes substantial diversions of traffic, and it might have serious effects on the Underground if large numbers of short-distance passengers were diverted on to it from the buses."
In other words, he was saying that increasing the fare from 2½d. to 3d. on buses will divert traffic to the Underground, and that because that may cause undue pressure on the Underground there must also be a halfpenny increase on the Underground fares in order to divert the traffic back to the buses. Yes— I laughed too. That is an unbalance of business; and if all the economic arguments I have repeated in this letter are applicable to London Transport, they are applicable to any ordinary average business.
It is useless for the noble Earl, Lord Selkirk, or the Chancellor of the Exchequer, or anybody else, to say "Well, there is only one justifiable course—to put up the costs by the fraction that is represented by 1s. per gallon." That is utter and complete nonsense. I want to ask the noble Earl what he expects anyone in business to do. Suppose a business, through rationing and this increased cost, has its turnover reduced by 50 per cent.: does the business man shut down half his business? Who pays the rents, rates and taxes on the half that is completely non-productive? Are the Government going to let him not pay any taxes because he is only doing half his turnover and making half the profit that he made before? Is that not a valid consideration for any business to have in mind?
The Government, in this Bill, have agreed that taxi fares in London shall go up by an extra charge of 6d. for any journey, however short. I do not begrudge the taximan in London that 6d., but what about the argument of the
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noble Earl and the Chancellor of the Exchequer that this should be only a fraction of a ld. more per mile, when every time one of your Lordships takes a taxi from here to his club in St. James's Street he will play an extra 6d. for that one mile? That is increasing the taxi fares of London by 6d. a mile. Why did the Government agree to that surcharge, in face of the economic argument of the Chancellor of the Exchequer, his Financial Secretary, the Economic Secretary and the noble Earl the Chancellor of the Duchy of Lancaster? It is the most futile argument that I, as a business man, have ever heard in my life.
May I ask the noble Earl this question, because I am puzzled? The Chancellor of the Exchequer, in his speech in another place, commended the great gesture of London Transport that they were going to bring in under this Bill, which allows an increase for London Transport of one-twelfth of the gross traffic receipts, an increase of only one-twentieth: they were magnanimous enough to do that. To my simple mind, one-twentieth is 5 per cent. In 1955, the total traffic receipts of London Transport— buses, tubes and railways— were £ 74,200,000. That included receipts from some contract carriages and a handful of freight, though it did not amount, I suppose, to more than £ 1 million. Five per cent. of £ 74,200,000, if my mental arithmetic is correct— I myself place no reliance on it; your Lordships can work it out— is £ 3,710,000. If I am right in thinking that the extra tax amounts to £ 40,000 a week, that means an extra £ 2,080,000 a year. But as London Transport are to increase their gross traffic receipts by 5 per cent., they will increase their revenue, or at least their estimated revenue at any rate, by £ 3,710,000. So they will make a profit on the deal of £ 1,630,000.
I do not know where my figures are wrong. They may be, but I have culled them from the official figures for 1955 of London Transport. Is that any disgrace, if they are covering more than 40 per cent.? I do not know whether they are covering all this. There may be subtractions which they have taken into consideration. Of course, London Transport, and any other business in this country, have to meet the extra cost of disturbance and alterations of this, that and the other in the fit-up of their businesses. I

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am shocked at the noble Earl, Lord Selkirk. The only thing I will say in mitigation is that he was reading an official statement. I could not expect him to tell a different story to your Lordships from that which three of his colleagues told to another place. But any business man in your Lordships' House would dispel and disperse that argument with contempt.
In this Bill, and in the Amendment to Clause 1 that was moved in another place, the word "temporary" is supposed to be underlined, because in another place this Bill did not have a friend: the unanimity of criticism was complete. So, knowing -the Government like their own Party and the Opposition in the House of Lords know them, they are not going to trust the Government to "get away with" the word "temporary" in only the Title of the Bill. Hence there is an Amendment to Clause 1 (2) which, as the noble Earl has said, states, in effect, that one month after the expiration of petrol rationing this extra tax will come off. I submit that that is a useless and worthless procedure, because it will not decrease by a day the period during which this extra taxation is levied, but it may well mean a long continuance of petrol rationing, because some clever person has got to decide which comes first.
My Lords, may I now deal with what, in my view, is the most serious part of this matter— namely, its inflationary effects? I am quite prepared to admit to your Lordships that a number of these extra charges are nothing more or less than squalid exploitation. But the Government should have known that. If I may use the vernacular, they did not "come down with the last shower." They should have known that immediately they took this course a certain section of the community would jump in. The corollary to this kind of thing is price control, but I suppose that is too much for the Government— that requires too much organisation. The worst exploitation of which I have heard is in regard to coal merchants who, I am given to understand, have been charging an extra 6d. a sack to those people in London who can afford to buy their coal only in 1 cwt. sacks—an extra 6d. in cartage owing to petrol rationing. That is a price increase. On the other hand, I
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have great sympathy with the vast bulk of people who have to increase their costs due to the cost of essential distribution. It is no sin if an employer of labour increases his costs, when, by an arbitrary action on the part of the Government, half his business goes overnight, in order to keep his men employed for as long as he can.
Of course there will be increasing wage demands. In my view, this is one of the most serious things that the Government have to face. I have often been asked over the last two or three years why it is that labour in this country will take that forward view which so many people think they ought not to take: why they do not wait for the harvest to be reaped instead of wanting to gather the corn before it is half-grown. The truth has always been that labour in this country have never believed that there ever can be permanent full employment under a Conservative Government—and how right they have been! The question of un-employment in this country is going to he serious. I will give your Lordships an example. The first impact of what we have seen during this last fortnight has fallen with brutality upon one of our greatest industries, the motor industry—the centre of an industrial empire which employs in its manufacture and distribution, 400,000 souls, and in its wider context about 2 million. In point of fact, one in sixteen of the wage-earning folk of this country depends in some degree for his wages upon this country's motor industry.
This industry has been the milch cow for successive Governments since 1926. 1 had the great honour of fighting the battle in your Lordships' House—it was one of the first speeches I ever made—to do away with the tax based on horsepower, to give our great industry the chance of selling in the markets of the world. Sense dawned upon Parliament, and that tax was abolished. But: what happened practically the day afterwards? — up went the petrol tax. The petrol tax has gone up; but, in spite of all the handicaps, the British motor industry has survived, and exported from this country last year £ 386 million worth of goods. That is the exact figures. Then came the credit squeeze that was a kick. Then hire purchase restrictions came alone: that was another kick, Then this, the greatest blow of all.

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What has been the result overnight? I think I am correct in saying that there is not a major factory— there may be a few minor ones— in the motor industry in this country which is working more than a three-day week. That situation has increased costs by 16 to 17 per cent, and it will increase costs still more. Freight charges, which had been soaring, have further increased. I can give your Lordships an example: the cost of shipping a motor car from this country to the Pacific Coast has risen by £ 30 to £ 35. These firms will struggle to keep their employees working. The pipelines of distribution from the factory to the retailer are clogged solid. The order books of the British motor industry are anything from 50 to 75 per cent. down on what they were in the corresponding period at this time last year. This is always the worst, the lowest, time for production in the yearly cycle. So I say — and I say it with a full sense of responsibility— that if the present position continues, if this present rationing and taxation continue, with no alleviation between now and the end of January, and no first-aid is brought to the assistance of the industry, the industry will have a quarter of a million unemployed at the end of January. That is the first impact of this situation upon the industry which has to stand the biggest rub. If that is not serious enough, I do not know what is. From the channels of information that are open to me that is the best assessment that I can make.
My Lords, what can be done? One thing stands out above everything else— namely, that we must get into this country as much oil as we possibly can, because that is the only thing that will help the position. I am glad that the noble Marquess the Leader of the House is here, for I want to ask the noble Earl if he can say whether Her Majesty's Government will give an undertaking that they will progressively eliminate this rationing by stages as soon as it is physically possible so to do; that they will not wait until petrol rationing can be taken off suddenly, but will take it off gradually. I want to ask Her Majesty's Government also whether they can do something to alleviate the position in regard to the heavy impost of purchase tax. Successive Chancellors of the Exchequer and Financial Secretaries have
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said in another place at various times that as soon as purchase tax made a really heavy mark upon industry, that fact would be taken into account in considering alleviation. Never in the history of the motor industry have we had a position like the present one. And do not forget that the impost of purchase tax on the commercial vehicles of this country is having an effect not only upon their manufacture and production for export but also upon industry's costs.
The last question I want to ask concerns credit. I expect some of your Lordships will be rather shocked at what I am about to say, but I feel certain that one thing which will have to be done to help the industry of this country over the very serious economic crisis which it is facing is a reduction in the bank rate. But let us leave to another time all the arguments surrounding that. For my part, I condemn this Bill. I condemn it as being unnecessary, and I condemn it as having dealt the economy of this country a blow which we shall not get over for very many years.
3.23 p.m.
LORD BRABAZON OF TARA: My Lords, I am fully aware of the fact that we are really only wasting time this afternoon in stating our views on this particular measure, because it is privileged and will be passed automatically, whatever we say or do; but I do not think that that should stop us voicing what is our frank opinion of this particular measure. Frankly, I consider it far and away the most imbecile Bill that I have had any experience of in my forty years of Parliamentary life. I have read with great assiduity everything that was said in another place, and all the arguments advanced, and I found them extremely unconvincing. What was even more remarkable was that there was not one note of praise for the Bill in another place, from either side of the House.
What are the two things which Her Majesty's Government have, very rightly, tried to force down our throat at every opportunity? They are two very sound theories: first, that we must keep the cost of living from rising. Her Majesty's Government make great appeals to the unions of this country to stop any demands for rises in wages, saying that they will look after keeping stability in the cost of living. The second thing for which Her Majesty's

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Government ask is increased production by our manufacturers. How can these two desires of Her Majesty's Government be better defeated than by a tax on transport? There is not a soul who is not going to pay more when he travels to work. The transport of goods, such a necessary and essential part of manufacture, goes up in price. It is no use pretending, as the Minister has pretended, that this will mean only a very small increase on the fares of the travelling public.
The noble Lord who has just sat down has said that by virtue of the delivery charge the price of a hundredweight of coal had increased by 6d. My experience is that it has increased by 8d. That is the kind of thing that is happening immediately because of this tax. Because of this tax, the cost of living has automatically gone up, and the cost of goods will be increased, to the detriment of our export trade. Surely it is bad enough to have a shortage of fuel and to have rationing. When Her Majesty's Government are going to tax the very essential services of this country, those providing our balance of trade, then I believe they have hit the country very unfairly and very unwisely.
Then I come to the question: What is it all for? We are told that we cannot afford to lose this drop in revenue of £ 30 million. I think we ought to look in more detail at the broader subject of national taxes. When we speak of loss of revenue we must divide our Budget into the parts in which it is divided—a balanced set of circumstances above the line and an enormous amount of taxation below the line. We are told that this year that will amount to nearly £ 500 million. I should very much like to know what Mr. Gladstone or Mr. Snowden would say to the modern Budget. It is nothing else but penal confiscation. Mark you my Lords, these surpluses do not go to reduce the National Debt. That was the old, classical idea of Budgets; but now the surplus goes to capital re-equipment; it goes to the mines; it makes nuclear power stations. In fact it goes to any particular thing that a particular member of Her Majesty's Government likes, except probably on the most important part of our re-equipment—on roads. Surely there is enough cushion in that surplus of £ 500 million to look after
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this £ 30 million which the Chancellor of the Exchequer is going to lose over these few months? The old classical idea was that when one re-equipped on the capital side one borrowed the money to do so. Apparently that idea is out of fashion to-day, and we are over-taxed by this monstrous amount every y ear in order to supply these necessary, but capital, luxuries which should not come out of revenue.
Much has been said of the balance of trade and the loss of dollars relative to pounds. I am still at a loss to understand how this particular tax is going to help in that respect. If Her Majesty's Government want to stop people buying dollar goods they can stop those goods coming into this country, They can stop imports of tobacco, cotton or films. That may he very unpleasant, but it would have an effect, whereas this extra tax will have no effect of that kind. The Treasury take the view (it is a very curious one, and I think it is high time it was contradicted) that if the Government tax people enough, then people will not buy dollar goods. I do not follow that reasoning. Why should they, because they are over-taxed, not buy dollar goods? It is for Her Majesty's Government to see that there are no dollar goods to be bought.
Eighty years or so ago, the medical profession held the view that if any body was ill the right thing to do was to bleed him. Of course, it was complete and unadulterated nonsense. But the Treasury now have the same complaint, and they think that they can tax our people into prosperity. If it were not so tragic it would be comic. Everyone with any common sense knows that only by relieving taxation can real prosperity be brought about. It is a dreadful thing to say, but, as a simple citizen, I have come regretfully to the conclusion that the Government of the day are riding for a fall. And if they are doing that, I must say they are doing it extremely efficiently. This may be a great comfort to the Opposition, but it is extremely galling to a loyal Conservative. I would invite your Lordships to-night to throw this Bill out—defeat it. It cannot make any difference; the Bill still goes through by the wishes of another place. But it would be a gesture now to this country that we do not consider it a wise measure, and that we are riot in any way responsible for it.
3.32 p.m.
THE EARL OF SWINTON: My Lords, I do not rise in order to pursue the question of whether this popular measure is as popular as the Government would have us believe. That is not my purpose. What I rise to raise is a deeper, more permanent and more fundamental question. As regards the popularity of the measure, it may well be that if it is right that in this House we have no responsibility at all for it, the great popularity which I believe the House of Lords enjoys in the country will not be diminished by our not having any share of responsibility. But I want very sincerely to put to the Leader of the House or to the noble and learned Viscount who sits upon the Woolsack— I am not quite sure to which my inquiries should be addressed; possibly they should be addressed to both— the far more fundamental and lasting constitutional issue which the noble Lord, Lord Lucas of Chilworth, raised for a moment in his interesting speech, and then, I thought, a little shied away from: that is, the constitutional position raised by Clauses 2 and 3 of this Bill.
There can be no question, whether this is a good Bill or a bad Bill, that Clause 1 is clearly what I may call, for convenience, an exempted business. That is the clause which puts up by £ 40 million or £ 50 million the tax upon oil. Then we come to the next clause. I am not criticising the merits; I thing it is right that taxicab men should be able to earn a living and that bus companies should be controlled in the extent to which they put up their fares. But that is not the point. Here we have "tacked on"— that is the right constitutional phrase— to a taxing measure, a Customs Bill, a pure Finance Bill, a clause which says that bus companies (I am paraphrasing, of course) shall not increase their fares by more than a certain amount and that taxicabs are to be allowed to increase their fares by a certain amount but not more.
What I want to know is this. The question of the reform of the House of Lords figured prominently in the Queen's Speech, and I am not one of those who think that the powers of this House should be increased, though I have definite views about how its Constitution might be improved. But I do most strongly take the view that the powers and privileges of this House should not be
1196
diminished, or, if they are to be diminished, that that matter should be a subject of full consideration and debate and not brought in, as it were, by a side wind. There is a lot in Erskine May about this matter. Some of the rulings are founded on measures for which I am afraid I was responsible, like the Ottawa Agreement Bill, which were dealt with a long time ago. But our own Standing Order 45 states the matter quite clearly. It says:—
"The annexing any clause or clauses to a Bill of Aid or Supply, the matter of which is foreign to and different from the matter of the said Bill of Aid or Supply, is unparliamentary, and tends to the destruction of constitutional Government."
We in this House certainly do not desire to infringe the rights of another place but there must be reciprocity in all this, and if that is our position (and each is in a sense master in his own house), then it is very important that the other place should not seek to extend their prerogative or privilege. The fact is that the Speaker in another place, for whom I have the greatest respect, is in the matter of "tacking" (I should like to be corrected if I am wrong) the sole authority to decide. But that does not mean, I would have assumed, that great care was not taken, and that there was not a certain amount of discussion through usual or unusual channels as to whether or not tacking was taking place.
I think we should agree— and I am sure that no one would agree more than the Speaker in another place— that the powers of neither House should be extended, but should be meticulously applied. How ought the rule to be construed that you must not tack any matter which is
"foreign to and different from the matter of the said Bill."
Of course, if you say that anything which can be associated with the Bill can be brought within it, the whole of what is called in our Standing Order a great constitutional principle is brought to the ground. After all, nearly everything in this muddled and mixed-up world to-day is more or less connected. I do not say for a moment that raising bus fares because the price of petrol is increased, or raising taxi fares for the same reason, is in that sense foreign to the imposition of this tax. But surely these words

1197
"foreign", and so on, have to be construed strictly and constitutionally in this matter. I am not saying that the provisions about buses and taxis are not fair just to put into an Order in Council or an Act of Parliament. But I do say that it is very odd to put them into this Bill. If this can be added, where are you going to stop?
My noble friend Lord Brabazon of Tara, and indeed an almost higher authority, if I may say so, the Chancellor of the Exchequer, said that this tax is going to have wide repercussions. This extra tax is going to affect almost every single commodity and service. The Chancellor of the Exchequer has said that it is important that that fact should not be exaggerated. He said (I do not seek to dispute his figures) it is one-fifth on this, one-quarter on that, and not more than three-quarters of a point on the cost of living, if everyone plays the game. If we put in a clause about buses and a clause about taxis, why should we not tack on to this measure all the things which the Chancellor of the Exchequer said it is so important to safeguard? Why is there not tacked on a provision that the oil companies should not raise the price of oil by more than a certain amount, or should lot increase their dividends? More than one speaker has referred to coal. One noble Lord said that coal has gone up by sixpence and another that it has gone up by eightpence—I dare say it will be a shilling before we are finished with it in the more remote country districts, in one of which I live. If it is right to put a limitation on bus fares, why should we not deal in this Bill with the price of coal? We might almost deal with the price of Christmas turkeys—or electricity.
I am not quarrelling with the merits of what is being done, but I think it is important that it should be done constitutionally. Nobody will appreciate this more than my noble friend the Leader of the House, who is such a keen guardian of the rights of your Lordships' House and such a wise leader in never seeking that this House should go further than it is entitled to go—and sometimes less far than the noble Leader of the House thinks that it is entitled to go. I think that it is right to ask your Lordships to take note of this point and to ask the noble Marquess the Leader of the House or the noble and learned
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Viscount who sits on the Woolsack to give us some assurance. I do not know whether any assurance cart be effective, because, when we do something like this, we are creating a precedent— that is the bother of it. The Government may say that it is very important to get this Bill through. We all want to go home for Christmas. I do not know why there is such a hurry about it. I am bound to say that if we are £ 500 million out below the line, it cannot make a lot of difference whether this Bill goes through now or after Christmas. I do lot think that any one of us would hesitate for a moment in passing the Bill if it were limited to Clause 1, to the imposition of a petrol duty, little as some of us may like it. I do not see why this matter cannot be separated. I am sure that if a separate Bill were introduced, embodying Clauses 2 and 3, we should pass it in one day, if that were necessary.
At any rate, I should like to raise the constitutional issue. If on to a Bill, the sole purpose of which, when it was introduced on a Ways and Means Resolution in another place, was to raise the Customs or Excise duty on hydrocarbon oils, there is to be tacked a provision about how much bus fares and taxi fares ought to rise, a precedent is being created. Whenever a Finance Bill is introduced which is going to have an effect on everybody in the community—as nearly every Finance Bill has— the Government would be able to tack on to it any clause they liked. Then the whole doctrine of tacking has gone by the board. I thought that it was worth while that somebody with experience of these matters should raise this issue, not at all from a Party point of view but from a constitutional point of view, and ask for some reply and for some assurance.
3,44 p.m.
LORD JESSEL: My Lords, I too should have liked to put down some Amendments to remedy what I think is a serious flaw in this Bill, but I topic advice and was told that such a course would be utterly useless. The object of my Amendments would have been to make sure that no operator of public transport services should, under cover of this Bill, increase fares by any amount exceeding that needed to offset the effect of the proposed duties on hydrocarbon oils. I am sure that noble Lords on all sides will agree

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that we cannot tolerate any profiteering from the exceptional circumstances which have arisen as a result of the closing of the Suez Canal. I suggest that under Clause 2, as it is at present drawn, this is quite likely to happen. There is nothing to prevent an operator from increasing existing fares by such an amount as would increase his aggregate gross receipts from permitted passenger fares by one-twelfth or, as the case may be, one-eighth, regardless of whether or not this increase is strictly necessary to offset the new duties under the Bill
I have been given figures relating to the Eastern Counties Omnibus Company, which I am assured are accurate. If these figures are accurate, they show that if this company availed themselves of the maximum increases permitted under the Bill, their increased profit would be, at the lowest estimate, at the rate of £ 100,000 a year. I would remind your Lordships that increases in respect of such matters as tyres and wages are a quite separate issue and can be the subject of an application to the appropriate authority. I have nothing against the Eastern Counties Omnibus Company, and I do not know whether, in fact, they are to increase their charges by the maximum amount permitted, but I do say that no operator of public transport should be allowed to make increased profits in this way, and that all operators should be made to deposit a statement with the traffic commissioners setting out the basis of the increases in their fares.
In another place the Financial Secretary to the Treasury emphasised that the London Transport Executive's increase is to be appreciably lower than the maximum permitted under Clause 2. That is very admirable. But what I am concerned with is the people who make the maximum permitted increase when it is not strictly needed. For all I know, there may be a great many people of this kind, and so far as I can see, this Bill gives Her Majesty's Government no powers to control these people. I hope that when the noble Earl comes to reply he will give me some reassurance on this point.
3.49 p.m.
LORD PETHICK-LAWRENCE: My Lords, I had no intention of rising to take part in this debate, but very important points have been raised on which
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I have views, and I should like to contribute them. I take no exception to what my noble friend Lord Lucas of Chilworth said. He raised important constitutional points. I take no exception to what the noble Lord, Lord Jessel, said just now. I think that his point ought to be carefully considered. Of course, the noble Earl, Lord Swinton, who spoke with great force and judgment, is entitled to raise the point he made, but I feel that I ought to put what I consider to be to some extent a case against what he said. He said that it was wrong to introduce in a Money Bill matters which were alien to the Money clauses in the Bill. Of course, that is quite true. But I think it would be a great stretch of the use of words to assume that these clauses are foreign to or alien to the Bill. I should have thought they were ancillary to the monetary clauses in the Bill.
THE EARL OF SWINTON: The noble Lord has a great reputation, and I do not want him to misunderstand me. I said that the "foreign" matter had to be construed strictly: that, when you introduce a Finance Bill, all sorts of consequences flow from it; and unless you construe the Standing Order and the House of Commons rule strictly, then you can introduce, as what the noble Lord calls ancillary to the Bill, almost any class of measure or control, or anything else.
LORD PETHICK-LAWRENCE: I was quite aware of what the noble Earl said, and I do not think he has added anything to it by his intervention. But I venture to say that it is an incorrect argument. That is the point. Perhaps the noble Earl will allow me to proceed a little further with his argument.
He said that it would be wrong— he was using a correct phrase— to introduce into a Money Bill anything that is foreign or alien to it. I agree as to that. But I contend that these clauses can be construed not as foreign or alien, but as ancillary. If my interpretation be correct, they are not foreign or alien, and I think we must accept them as reasonable parts of a Money Bill. The noble Earl then went on to say that if it was possible to put in a clause about public transport, and a point about taxicabs, would it not be equally possible to put in something about the price of coal? That is quite a false analogy. The noble Earl, presumably, forgets that public transport is

1201
controlled in its prices by the Government, and by law, and that taxicab owners are equally controlled by Statute in the prices they charge, but that there is no Statutory decision as to the price of coal. Therefore, I see a great distinction. The fact is that, in the present state of affairs, the Government prevent the price of transport and the charge for taxicabs from going up beyond a certain figure. Therefore, if they alter the ingredients of the price, they must at the same time alter the total price, otherwise they are putting a burden upon taxicab owners and the transport authority which they are quite unable to bear.
The noble Earl suggested, further, that we should be doing a great public service by making a protest. I do not say that he went so far as to say this, but he seemed to imply that we should be doing a noble thing if we went into the Lobby and, on constitutional grounds, voted against these clauses of the Bill. I would say from these Benches that I do riot think we on this side have the least intention of putting ourselves so completely in opposition, not to certain clauses of the Bill but to the decision of the Speaker of the House of Commons. That is the fundamental point. Whether the noble Earl is right or wrong— and I think he is wrong—the decision in this matter rests, by Statute, with the Speaker of the House of Commons. He, no doubt weighing all the points that the noble Earl has raised, has come to a certain decision. and has given a Certificate that this Bill is a Money Bill.
In those circumstances—and I am sure my colleagues on these Benches agree—I cannot associate myself with an attack upon the Speaker of the House of Commons. I think that would be, in effect, to bring the House of Lords against the House of Commons; and, much as I dislike the Bill in many respects; much as I may disapprove of the details of the clauses; and whatever may be said for the views put forward by the noble Lord, Lord Jessel, I should be sorry to see this House going into opposition to the Speaker of the House of Commons in this matter.
3.55 p.m.
EARL JOWITT: My Lords, perhaps I might say a word or two, if only to emphasise that this is not a Party matter in the least. I am not sure that I do
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not agree more closely with the noble Earl, Lord Swinton, than with my noble friend who has just spoken. Of course, it is a matter for the Speaker, and, as I think, we cannot divide against it. I have no doubt that the Speaker in the House of Commons, in the exercise of his discretion, has taken great care. But with the noble Earl, Lord Swinton, I am a little surprised at the decision that has been come to. Supposing you have a measure which affects— as I suppose this one will— shopkeepers. You say, in Clause 1, that a certain tax is to be paid; and Clause 2, in order to compensate them for the loss that they sustain, says that shops may keep open an hour longer than usual. The latter point, plainly, would be a matter that your Lordships' House ought to consider. Or supposing you say that agriculturists are going to be affected adversely by a rise in the cost of petrol, and that they may, therefore, employ school-children outside their holidays. Again I should have thought that was plainly a matter which this House ought to consider.
Though I agree with my noble friend Lord Pethick-Lawrence that we should not go contrary to the advice of the Speaker, who has decided this matter in a way that we have to follow, I cannot think it is a bad thing that we should have made this moderate protest, in order that in the future this matter may be looked at perhaps a little more critically than it has been to-day. With those few words, I hope to have harmonised the views of my noble friend Lord Pethick-Lawrence and the noble Earl, Lord Swinton.
3.57 p.m.
LORD SALTER: My Lords, perhaps I may be allowed, though not a lawyer, to add one or two words to the arguments that have been put forward. I must say that I share the anxieties as to what might easily happen in regard to the Rules that have been adopted. I certainly would not for a moment propose an Amendent, or go into the Lobby to contest the Certificate given by the Speaker. But I do suggest that your Lordships do ell, when you feel anxieties, to voice them, in order perhaps to have some influence upon future decisions in other cases. I need not remind your Lordships of what a part in the history of the relations between the two Houses tacking has played. Nor need I emphasise the

1203
fact that even those reduced powers which are now, by deliberate Statute, left with this House might easily be reduced to nullity if, even within the limited period during which we may stop legislation, we found that we could not act because of any kind of loose extension of the tacking on to a Finance Bill.
I quite understand the argument of the noble Lord, Lord Pethick-Lawrence, that this is perhaps ancillary rather than something which deals with consequences. But the ancillary can slip over quite easily into what deals with consequences, and I would much sooner have the idea in mind that it is only what is integral that is permitted, rather than what is ancillary. Once you have the less exacting criterion, there is no end to the extent to which, even within the permitted powers of this House under recent legislation, we might find that our powers had been filched away from us.
4.0 p.m.
THE LORD PRESIDENT OF THE COUNCIL (THE MARQUESS OF SALISBURY): My Lords, during the course of this debate various criticisms have been made of the Bill before the House. We have had a full-blooded attack made by the noble Lord, Lord Lucas of Chilworth, and an almost equally full-blooded attack made by the noble Lord, Lord Brabazon of Tara. I do not propose to answer them, because my noble friend Lord Selkirk is going to reply by leave of the House at the end of the debate. But the noble Earl, Lord Swinton, has raised a different question, a question not of the merits of Clause 1, which is the main part of the Bill, but whether Clauses 2 and 3 should have been "tacked on"— I think that was his word — to it. That is a constitutional question, and the noble Earl was good enough to ask my opinion about it. I did not know that this subject was going to be raised until I heard him speak. Constitutional questions, I believe, require a special study before an opinion is expressed on them. But I will do my best within the limitations which are placed upon me.
The noble Earl and I have often fought together for the privileges and rights of this House, and I hope we shall go on doing so for many years to come. But I am, like the noble Lord,
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Lord Pethick-Lawrence, a little doubtful whether his reading of Standing Order No. 45 is correct. The noble Earl quoted it, and said, what is quite true, that it says:
"The annexing any clause or clauses to a Bill of Aid or Supply, the matter of which is foreign to and different from the matter of the said Bill of Aid or Supply, is unparliamentary, and tends to the destruction of constitutional Government."
Of course, all these things are questions of degree. No doubt if one could imagine consequences which are very far away from the original purpose of the Bill, it would be improper to include them. These are direct results of the measures taken under Clause 1, and I should have thought they might well have been held to come within the limits of a Money Bill. It is purely a matter of opinion.
I find that Erskine May says:
"A Bill which contains any of the enumerated matters and nothing besides is indisputably a money bill'."
We all agree about that.
"If it contains any other matters, then, unless these are subordinate matters incidental to any of the enumerated matters so contained in the bill, the bill is not a money bill'."
That is a definition on which I imagine Mr. Speaker had to come to his conclusion. Mr. Speaker has absolute power in this matter under the Parliament Act, 1911, and nobody can dispute his ruling. It would be an impertinence on my part even to comment on his ruling. But I think it was one of those borderline cases which he might have decided one way or the other, and in this case he decided as we all know. It is no good, in such circumstances, any of us in this House trying to reverse the decision which has been reached.
There is only one other thing I would say, and it is this. Whether or not other noble Lords agree with the ruling which Mr. Speaker has made, I do. Perhaps the noble Earl, Lord Swinton, is more doubtful. He thinks that arguments could be put on the other side, and so on. At any rate, I am grateful to the noble Earl for having raised the matter. We are always in a difficult position in this House, owing to the limitations under which we work, and it is quite right that when a case of this kind arises— it does not often happen, but it does every now and then— we should show that we are

1205
alive to the dangers of an undue extension of the powers which may be exercised under the Act. I have no doubt that Mr. Speaker himself will be extremely grateful to the House. It shows that we watch carefully the limitations under which we operate. If we did not do that, we might be reduced even below where we are in our control of legislation. All I rose to say was that I am glad the matter has been raised. I believe that the decision of Mr. Speaker was the right one—that is a matter of opinion— and, in any case, it is not for us to dispute it.
LORD LUCAS OF CHILWORTH: My Lords may I be permitted to say just one thing? When I introduced this important matter in my opening remarks, it was in no way to criticise the action of the Speaker in certifying the Bill. My objects were to criticise the Government for not introducing two Bills. I said that that was the way out of it. I consider that the second Bill should have contained all those provisions about bus fares and taxi fares, which could then have been dealt with by amendment in the ordinary course of business.
THE MARQUESS OF SALISBURY: My Lords, the only answer I can give to the noble Lord on that—and I am speaking only by leave of the House—is that he would have been right if Mr. Speaker had come to the other decision. As Mr. Speaker came to the decision he did, it is impossible for the noble Lord to argue that there should have been two Bills.
LORD LUCAS OF CHILWORTH: But the Speaker should never be placed in that position. The two Bills should have been introduced into another place.
4.7 p.m.
THE EARL OF SELKIRK: My Lords, I do not wish to continue this discussion. I will not add much to what has been said. Noble Lords have explained to me at some length that they do not like this Bill. I did not expect they would. All I would say to the noble Lord, Lord Brabazon of Tara, is that he did not understand the effect of the problems which the Chancellor of the Exchequer has to face as regards the confidence in sterling. The interesting thing is that international confidence in sterling has risen since the Chancellor of the Exchequer took the measures he did.
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The noble Lord, Lord Lucas of Chilworth, raised a wide variety of questions. In fact, he went a long way towards opening a general economic debate. He dealt with all kinds of things like the credit squeeze, the bank rate and purchase tax. Quite frankly, they have nothing whatever to do with this particular Bill. I do not question that the motor industry is going through a difficult period, but it would be completely wrong to pretend that all the problems are connected with this particular Bill. They are connected with a wide variety of subjects, as the noble Lord is aware.
LORD LUCAS OF CHILWORTH: That is what I said.
THE EARL OF SELKIRK: I do not believe the noble Lord's anxieties about I unemployment are justified. Indeed, have been given the figure of 1·1 per cent. of the labour force, which means that to all intents and purposes, there is a very low rate of unemployment at the present juncture. The anxiety for the future may, of course, be justified, but there is no reason to suggest it at the present time.
LORD PETHICK-LAWRENCE: Does that figure of 1·1 per cent. take into account short-time working, because it is not unemployment in the legal sense?
THE EARL OF SELKIRK: I agree that the figures I have given are for unemployment, and not short-time working. I am not questioning that short-time working does exist, but this Bill is certainly not the cause. It would be much more serious if the limitation of the resources of oil which we have to face at the present time was not reasonably evenly distributed.
The noble Lord, Lord Jessel, raised the question that this measure gives too great freedom and too strong a power of decision to the bus companies. I must confess that t find it rather difficult to believe that that is, in fact, the case. I think I am correct in saying that this represents an increase in cost of fuel of about 35 per cent., whereas the increase in fares which these provisions will permit for bus companies may be anything from one-eighth to one-twelfth. It is possible, of course, that some companies may be in an advantageous position for using this provision to the full. They may be in a better position than others. My own feeling is—I should be surprised if it were

1207
not true— that a great many bus fares at present are very near the limit that the traffic will bear. If the companies put them up unduly, they may well find that they will lose their traffic. I should be surprised if the bus companies were able to say that they were in such a position that they could, in fact, extend their fares considerably without losing a great deal of their traffic.
May I also point out that in any case this is a temporary measure. We hope it will last only a matter of months. In that event, it will fall upon the traffic commissioners to make such adjustments after that time as they may think necessary, because this tax ends completely. Does the noble Lord really think that the opportunity will be taken during what may be only a matter of three or four, or perhaps five or six, months by the bus companies to do things which would outrage or, shall I say, annoy, their travelling public? I should doubt very much whether that would be so.
I fully appreciate that this is not a Bill which noble Lords find very satisfactory. The noble Lord, Lord Brabazon of Tara, told us that he found very few supporters in the other place. I wonder when the noble Lord was in the other place how often he voted in favour of any form of tax on motor cars. It is extremely rare for anyone voluntarily to vote in favour of taxation.
LORD BRABAZON OF TARA: I have already made one speech on behalf of the Government.
THE EARL OF SELKIRK: That is, of course, what the Government hope for. On the other hand, it does not necessarily mean to say that a taxation measure is wrong because it is unpopular. Those are the hard facts of this case. I should like your Lordships to look at this Bill in that light. I am sorry that the noble Lord, Lord Derwent, is not here because, when I raised this question before, he pressed me very hard to give a more formal undertaking that it would be temporary. This temporary provision is now formally incorporated in this Bill.
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I said that I would try to obtain a more formal recognition. It is there. From the time when rationing is taken off, unless Parliament decides to the contrary, the provisions of this Bill automatically fall. I think, with respect, that that is going as far as any Government can go, and indeed it is a good deal further than most Governments have been able to go.
LORD LUCAS OF CHILWORTH: My Lords, would the noble Earl try to answer the specific question I asked him: is it the Government's intention progressively to increase the ration, when circumstances permit, and not wait until they can remove rationing entirely before they make an easement?
THE EARL OF SELKIRK: This Bill has absolutely nothing to do with rationing.
LORD LUCAS OF CHILWORTH: It has.
THE EARL OF SELKIRK: I am always at the disposal of the noble Lord, Lord Lucas of Chilworth, and I seek very hard to answer his questions. I am afraid that, at the moment when the rationing scheme is just coming in and, as the noble Lord is fully aware, is inevitably raising great problems, I should be unwise to give any prophecies about the way it will work out.
EARL JOWITT: The noble Lord is "tacking".
THE EARL OF SELKIRK: I think he is.
On Question, Bill read 2ª; Committee negatived.

NURSES BILL [H.L.]
4.16 p.m.
House in Committee on Recommitment of the Bill (according to Order): Bill reported without amendment.

NURSES AGENCIES BILL [H.L.]
House in Committee on Recommitment of the Bill (according to Order): Bill reported without amendment.

MINING OF NON-FERROUS METALS
4.17 p.m.
EARL JOWITT EARL JOWITT rose to call attention to the urgent need for exploiting the natural resources of non-ferrous metals in this country; and to move for Papers. The noble and learned Earl said: My Lords, after the controversial debates we have been having in the last few days, it is perhaps a relief to get to something which is completely non-controversial, which is completely non-controversial, which involves no sort of attack on the Government and which I raise in order that I may ventilate a subject which I think needs to be considered, has been neglected in the past by all Governments in this country, and I hope will be considered in the future. Before I say anything else, I hope I need not say that I have no sort of financial interest, either actual or prospective, in this matter, and I am afraid it will be very plan as I go along that I have no technical knowledge of it either.
I do not know whether we have in this House geologists or mining engineers — I know we have other engineers of great distinction but whether we have a mining engineer I am not sure. When we have a reformed House of Lords, if ever we do, I hope we shall have representatives of the sciences of metallurgy, mining engineering and all the rest of it. For the reasons I have indicated, I shall keep off all technicalities, because if I get on to technicalities I shall be completely out of my depth; but the broad principle which I want to raise is, I think, plain.
If we are going to get out of the difficulties in which we find ourselves to-day, it is obvious that we must exploit every asset which we have. It is no good just sitting back, and it is no good, as the noble Lord, Lord Brabazon of Tara, has just reminded us, thinking that we can cure all the ills to which we are subject by slapping on new taxes. Obviously we cannot. We have to exploit what assets we have still in this country is a considerable mineral reserve. The world is rapidly using up its available supplies of metal. Recently there has been the Palely Report in the United States of America, which has suggested that the American consumption of metal will be double its present figure by the year 1975, and already in the United states, by intensive research, they are making do with all sorts
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of minerals which heretofore they would have disregarded altogether. As I have said, I believe we have considerable reserves, but the trouble in this country is that we are not metal conscious— we never have been; we have never had to exploit these reserves in the past. I feel that at the present time we are falling between two stools. There are those who want to get some kind of a policy based largely on public enterprise; there are those who want to get some kind of a policy which stresses the importance of private enterprise. Between the two we are in danger of not getting any policy at all, and that is a fact to-day—we have not got a policy.
In The Times of November 28 last, Dr. M. G. Fleming, who is, I suppose, one of our greatest authorities on this matter, wrote:
"The assurance of future supplies requires long-term planning, energetic applied research, an active development in mechanical equipment and highly trained technologists.…"
He added:
"It should be said quite flatly that none of these requirements is adequately fulfilled in this country."
Recently we had a debate on the shortage of technologists, about which we are all painfully aware. Steps are being taken by the Government to try to remedy that deficiency. Dr. Fleming goes on to say that the Department of Scientific and Industrial Research had held a congress in November, 1954, and made a report, and in September, 1955, the institution of Mining and Metallurgy
"held an open symposium to discuss the whole question of mineral resources policy."
The consensus of opinion at the last meeting was that an advisory panel should be formed to
"give guidance to the Government on short-term and long-term policy regarding mineral development and use, and, secondly, that adequate facilities for ore testing and mineral processing should be provided."
He continues in his article in The Times by saying that these reports have been received with general lassitude— which I think is quite true‖for three reasons: first, because we are not mineral conscious; secondly, because no recent Government, save in time of war, has had a mineral policy, and thirdly, because there is little co-ordination of effort, though I am bound to say, so far as this country is concerned to-day, that I suppose that that is largely true because there

1211
is precious little to co-ordinate in regard to non-ferrous metals. But Dr. Fleming points out that
"in the face of growing competition in increasingly scarce materials we have a long-term problem which is very likely shortly to tax the combined resources of Government, science and industry."
He concludes by pointing out that the proper utilisation of our reserves of metal offers an
"immediate substantial reward in the increase of foreign currency and the alleviation of the sterling Commonwealth's balance of payment difficulties."
In 1946, Mr. Shinwell, who was then Minister of Fuel and Power, appointed what I shall refer to as the Westwood Committee, who made a Report on Mineral Development. Weir Report was made in 1949, and it is particularly interesting because Mr. Peter Thorneycroft, the present President of the Board of Trade— and the Board of Trade are in effect, I think, replying to this Motion — was a member of that Committee, and he therefore knows a great deal about it. The majority— indeed, all except Mr. Thorneycroft— put great emphasis on public enterprise, and Mr. Thorneycroft put his stress on private enterprise. I entirely decline to suggest that because we are confused between these two things we can any longer tolerate our having no policy at all. It is rather like the tethered donkey with the bundle of hay on one side and water on the other. He could not make up his mind which to go to and finally died of a combination of starvation and thirst. For goodness sake do not let us get so confused between the merits and the de-merits of these two concepts that we have no policy. Any policy is better than none.
The long-term policy which the majority favoured was that the Minister of Fuel and Power should set up a permanent organisation to take stock of minerals and development value. It was to collect all information; to have a mineral survey which was to include exploitation; to promote research, and to set up appropriate organisations to operate mineral projects. The Report points out that these objects would be achieved by a long-term policy. Paragraph 388 says:
"Clearly, the Government interest must be related closely to the merits of individual
1212
cases, and in practice this must mean an interest in the establishment of a technically sound prima facie case for exploration."
The next paragraph says:
"We have come to the conclusion, therefore, that the Government must take an active part in the discovery, del imitation and assessment of new mineral occurrences when this cannot satisfactorily… be undertaken by private enterprise. The main object must be to obtain preliminary information which. when made available to private enterprise, would encourage exploration or the expansion of existing operations…"
Consequently, they reject what they describe as the short-term policy", that being a policy which left it to private enterprise and encouraged private enterprise by giving them appropriate inducements by way of financial concessions in one form or another.
The Committee point out in paragraph 343 the difficulty in this situation. They refer to the fact that we are now concerned with lode mining. In the old days the surface metals were picked out as they were. They point out that with the uncertain nature of the mineral deposit, especially in lode mining— the type of mining which we have to do— the uncertainty of the life of the deposit, and the risk of violent fluctuations in market prices, the development period is particularly long and costly before profits can be earned. So they, the majority, reject any financial concessions; they say that they savour too much of a short-term policy, and they are in favour of a long-term policy. In paragraph 345 they say this, in particular, dealing with tax concessions:
"In some respects it would appear to be one of the easiest ways… of encouraging mineral development. The main argument used is nearly always the lack of incentive given by a high taxation rate in comparison with the risk factor… We have come to the conclusion that preferential tax concessions to encourage mineral development and production would not be the correct long-term remedy."
It is all very well to reject these things if Her Majesty's Government are going to have a long-term remedy, but my case is that, if they are not going to have a long-term remedy, which may be the right thing, let them, for goodness' sake! consider what I am shortly going to say.
Concessions of this kind have been made in other countries with remarkable results. I have not studied the position of the United States of America; but

1213
they take the greatest care not to be caught short of any mineral, and therefore they are stockpiling. Recently, to get a particular mineral they wanted, they offered a flat subsidy of 100 per cent. over the market price, and I need hardly tell your Lordships that they got straight away the 7,500 tons they wanted.
LORD SALTER: My Lords, I think the noble and learned Earl would find that the United States Government have given important tax concessions of a kind which we have not got in this country.
EARL JOWITT: My Lords, I am much obliged to the noble Lord who knows a great deal about these matters, and I am pretty certain that that must be so. In Canada they have done it especially and generally. The Canadian Government are purchasing all the uranium which is won at such a generous price that the company in question is able to amortise all its costs in the short space of five years. So that, too, is going pretty well. In Australia, they want to encourage uranium mining and gold mining, and they have a scheme whereby no tax at all is exacted for five years. In Canada, one is tax-free for three years. I am not sure whether that applies to all minerals or only to precious metals.
I have studied the position in Ireland, and I have the facts here in a convenient form. Ireland has recently, by an Act of 1956, tried this experiment and has introduced, in respect of these nonferrous metals, a Bill under which new companies undertaking work are free of tax for four years and pay only half-tax for four years thereafter. That is a very generous concession. What has been the result? These are the facts reported in the Mining Journal:
"In consequence of this concession, six Canadian groups are now operating in Eire, three of which have subsidiary companies at work."
They give them good Irish names, of course— St. Patrick's Copper Mines, the Mining Corporation of Ireland, Limited, and the Emerald Isle Mining Company, Limited. All are running on Canadian money, with Canadian skill and Canadian enterprise. I will give your Lordships only one illustration—what has happened at St. Patrick's. I read from the Mining Journal, having checked with the Irish
1214
Minister of industry and Commerce that this is correct:
"St. Patrick's Copper Mine took over control of the Avoca Mines a year ago. As a result of exploratory work it is satisfied that arrangements for commercial production can be made. Work is in progress on the construction of a 7.000 foot tunnel designed to open up the ore bodies for production. This tunnel is already over 1,000 feet long. Preparatory work for the installation of a concentrator is in hand and the construction of workshops and houses is under way.
The company has already spent over £500,000 on operations at Avoca and estimates that it will require to spend a further £1,750,000 during the next year or so to bring the mine into production. About 250 men are now employed in the mine which expects to go into production towards the end of next year."
I have seen reports on some of the other mines which are also very flourishing. That is a very remarkable result. Ireland has £2¼ million of capital invested, and has Canadian technicians and experts at work who are finding, or expect to find, copper.
Of course, we need not do that, and tax purists will say that should not be done by tax concessions of that kind, but that it may be done by special depletion allowances first given by Sir John Anderson (now the noble Viscount, Lord Waverley), in his Budget of 1945. Further concessions were given by Mr. Butler in 1952. The recent Royal Commission on Income Tax said that, even so, mining concerns were not being treated fairly, and that further concessions ought to be given to put them on a parity with other concerns. I myself feel that there may be an objection to spending our own capital on obviously hazardous enterprises. We have not a great deal to spare. No doubt that is the view taken by Mr. Thorneycroft, because in the last paragraph of the Report, in a dissenting note, he says:
"I conclude that it is possible to further mineral exploration and development in the United Kingdom by reducing the general level of taxation and the removal of the complex administrative barriers which at present hamper and restrict it. I would, however, advise any Government (particularly in existing economic circumstances) to think well before it ventures public funds in so hazardous and speculative a form of enterprise."
If anyone thinks that we are likely to see a sharp reduction in the general level of taxation, his name is "Sunny Jim." I do not think that we shall get it in that way, so we have to consider what can be done in other ways.

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I noticed, in the Symposium of 1956, to which I have referred, that the Chairman of the Cornish Mining Development Association said that his Association:
"had made herculean and most persistent efforts to awaken successive Governments and leading civil servants to the importance of developing Britain's own mineral resources, but he had to admit that they had met with very little success. As far as the intricacies of taxation were concerned, he was frankly out of his depth, but his Association's honorary auditors had gone very carefully into the recent recommendations of the Royal Commission on Taxation. They advised him that the incentives for home mineral development in the Commission's recommendations were practically nil. Personally, he did not think that those tax incentives ever would be forthcoming until the public had been made really mineral conscious.
"Three or four years ago his Association addressed a questionnaire to four of the great British mining houses asking why they were showing so little interest in mineral development in Britain. In every case the answer, with emphasis, was 'Taxation'."
There are famous houses in this country — for instance, Consolidated Goldfields of South Africa, Limited, and John Taylor & Sons, who used to manage the gold mines in India which have now been nationalised. All are located here, but the concessions given in 1945 and 1952 have not proved to be sufficient. To use the legal phrase, Res ipsa loquitur.
The fact is that since these concessions were given no new companies have started operations, and such operations as there are in this country are very small. There are two tin mines operating in Cornwall to-day. One is called South Crofty, the other is Geevor. They are both doing very well. I believe that there are one or two small lead mines still operating in Wales (I am sure that the noble Viscount, Lord Falmouth will be able to help me here) and that there has been some investigation of lead in Wales. Some exploration is going on in Anglesey and some in Scotland. But the whole lot, added together, amount to very little indeed. And here we have some of these people, who really do know what they are talking about when they speak of mining in this country, who could so easily embark on this but who are not doing it. Is it not well worth while trying to get these people to develop these reserves, which would be a great source of strength to us? I have said that I have no technical knowledge, but I have been told a certain amount about these matters in the last few days.
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Let me take one illustration to start with— that of tin. Let me consider the position of tin. I have no doubt that there is great danger of the supply of tin giving out in the not far distant future. In Malaya, of course, tin mining has taken place in respect to alluvial tin, and I am given this dramatic figure: that one dredger in one day will recover as much tin as nature has deposited in a generation over the whole of Malaya. We all know—it is common knowledge— that there is great danger that the alluvial tin in Malaya will give out fairly soon. Professor Jones is one of the greatest living authorities on this matter, and I can quote him. He recently addressed a meeting of the Institution of Civil Engineers and he is reported as saying that:
"Surface supplies of tin are fast running out. Many Malayan resources would be exhausted in twenty years, and the bulk of Nigerian deposits within eight to twelve years. When surface deposits ran out supplies would have to come from underground lode-mining and the greatest concentration of lodes known are in Bolivia and Cornwall."
The present price of tin metal is nearly £800 a ton. In the old days, in Cornwall, they worked, naturally enough, the easiest places. Frequently they did not go down to a considerable depth— sometimes they did, but frequently they did not. When the price of the mineral went down to under £100 a ton, they stopped work, not because of exhaustion of supplies but because, owing to the low price, working the tin was, for them, no longer profitable. Some authorities to whom I have spoken tell me that there is more tin still to be mined in Cornwall than has ever been taken out of it, but that greater depths have to be probed. What was taken out of it in the past yielded most fabulous profits to those concerned.
There are, I understand, six, areas in Cornwall, the first three in the Western part of Cornwall and the other three in the middle and East, where the prospects of tin-mining are very favourable. One of the first, which is in the Western part of Cornwall, is St. Agnes.
In the recent Report, Metalliferous Mining Region of S.W. England, published by the Stationery Office in 1956, the learned author says:
"At St. Agnes the lodes are parallel with the coast and though very rich tin deposits have been worked up to the coastline no cross

1217
cut has been driven beyond. It seems most unlikely chat the boundary of St. Agnes emanative centre coincides with the coast and probable that satisfactory results might be obtained from investigations seawards in this locality."
Another area which the noble Viscount, Lord Falmouth, will know very well— that of Carn Brea— is referred to in the same work as "by far the most important." I have recently been reading a book by Mr. F. Lyde Caunter who, though he has no financial interest, has, like a good Cornishman, taken a life interest in this subject, and I have sent a copy of his book to Lord Mancroft. Mr. Caunter writes:
"I have lone been convinced that the economic production of in Cornwall can be substantially increased, and in time built up to between a quarter and a third of Great Britain's total consumption.
"This would be a very considerable contribution to the National economy. Not only would it be a dollar-saving device, but in case of war would ensure a considerable supply of metal for our tinplate industry."
He then refers to what Major Brian Llewellyn wrote in 1946, in his Report on the Carn Brea area of Cornwall:
"His, estimate of the value of potential reserves of tin in this one area alone was no less than £50 million. His report was adopted by the Institution of Mining and Metallurgy and was not seriously challenged and since then the developments is the South Crofty Mine. the only one working in the Carn Brea area, have confirmed rather than otherwise the evidence of large reserves."
At South Crofty, the output of tin for the year 1955 was the largest for that mine for the past fourteen years. The output for the first nine months of 1956 exceeded that for the corresponding period of 1955. The company is erecting additional plant to extend its output still further. Major Llewellyn writes:
"It may fairly be said that the Northern area has never been prospected in depth and it is obvious that large areas of excellent promise remain to be explored."
So far as the other mine, Geevor, is concerned I have seen set out the dividend record—I think it appears on page 53 of the book. Lord Mancroft will see from it that the company is at present paying the handsome dividend of 45 per cent. Of course that is nothing to the dividends that used to be paid in Cornwall. There was a mine called the Tresavean mine which in the old days paid a dividend of 400 per cent. per annum for twenty-five consecutive years. Unfortunately that was before our time.
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That is my case with regard to tin. I say that it is probable—and I think experts believe it— that there are very large reserves of tin. But, of course, it is a question of lode mining: it is speculative and hazardous. You may be unlucky; you may not strike a particular lode. Therefore it is a hazardous enterprise. But is this something which we can afford to leave there, in respect of which we can afford to do nothing at the present time? If we are to have a long-term policy, if the Government are going to open this out and demonstrate that tin is there, then one would have nothing to say against that. But if they say they are not going to do that, then surely they will do something to encourage private enterprise to take this up and demonstrate the potentialities. In present circumstances private enterprise will do nothing about it.
Next I should like to deal with tungsten. I am not going through a long list of these things, but there is ground for supposing that tungsten is to be found in this country in considerable quantities. It is found in this country in the form of wolfram. The tungsten, I suppose, is separated from the wolfram. A ton of wolfram will be worth £ 1,150, so a unit is worth about £ 11 10s. At Hemerdon, in Devonshire, there are large deposits, and it is also found at Carrock in Cumberland. Deposits put at 4 million tons are supposed to exist, and it is supposed that there are much larger quantities deeper down.
THE EARL OF MORLEY: My Lords, may I tell the noble and learned Earl that I was a director of the company at Hemerdon? We worked that mine for the Government, and it cost so much money that it was quite impossible to carry on.
EARL JOWITT: The Westwood Committee deal with that in their Report. The long and short of the matter was that during the war we dealt with these things quickly and had a rather hand-to-mouth policy. But the Committee say this in paragraph 259:
"It would seem to us, therefore, that Hemerdon presents a strong argument for the outlay of capital with the object of proving the extension in depth and value of the mineral deposit. Without this essential information it is useless to consider the possible economic importance of the plant when an ore supply of at the most, only 4–5 years' duration is

1219
at present proved. We have considered various schemes of exploration drawn up by the Hemerdon Management, and while the final method selected could only be arrived at after closer study, it is probable that a series of exploratory shafts and galleries would be most suitable."
They recommend that nothing be done there until further exploratory work has been undertaken.
THE EARL OF MORLEY: My Lords, we did work there for three years for the Government and found it quite impossible to make any money.
EARL JOWITT: The actual figures are given here. I am not saying that it is necessary that the Government should do it. If they could encourage somebody to take it on, I am sure that the noble Earl would not mind. I know that he is not one of the people who are going to take it on, but I am sure that he would not mind anybody else trying.
THE EARL OF MORLEY: My Lords, I should be perfectly willing to take it on if there were any possibility of its paying.
EARL JOWITT: I come now to lead. I am not going into the details; the facts are given in the Westwood Report, which says that there are grounds to suppose that there are very considerable deposits of lead in various parts of the country — in Wales, in Scotland, in the Pennines and in other districts. The price of lead is much lower than the price of tin. Tin is nearly £ 800 a ton, while lead would not be much more than £ 114. Therefore it is necessary to find lead of a much richer ore than is the case with tin. I cannot guarantee that these minerals exist, but I am saying that a body of trained and expert people believe that they do exist and that, in our own interests, we ought to develop them, either by public enterprise or by making it possible for private enterprise to do so.
Finally, I should like the noble Lord, Lord Mancroft, if he can, to answer a question about the potash position. There is no doubt at all that a large seam of potash was discovered near Scarborough, but it is about 4,000 feet deep; and the problem is whether it is possible to develop it economically. I believe that Imperial Chemical Industries sank a shaft, but I do not think they got the core— I am not sure that the shaft did
1220
not cave in, or that it proved to be not in the right place. In the end, I think they felt that it was not their primary business, and were no longer interested. I raised the matter with the noble Earl, Lord Woolton, when he was Minister of Materials, and, if I remember correctly, he told me that he was in negotiation with another company. I do not know what happened, and I should like to have our information brought up-to-date. It may well be that it is not a commercial possibility, but I feel that our lack of mineral consciousness made us just do nothing about it. I shall be interested to hear what the noble Lord has to say.
LORD SALTER: My Lords, it is true that the first experiment made by I.C.I. did not give satisfactory results.
EARL JOWITT: I understood that. On the last occasion the noble Earl, Lord Woolton, told me that somebody else was going to experiment with it, and I should like to find out what has been done.
That, then, is my case. I claim that to-day we in this country have no mineral policy. I am not making a Party attack at all; this applies to my Government, too. I do not think we have ever had a mineral policy. I think that that is because we are not mineral conscious. It is probable that we have large reserves of tin and of some other minerals, but it is far from certain that the developments in any one of these places would prove to be a profitable enterprise. In short, it is a highly speculative enterprise. All that is certain is that the exploratory work will be expensive and that the explorer will find considerable difficulties — perhaps with regard to labour or to the multiplicity of owners or all sorts of other things which we naturally find.
If we are going to develop a mineral policy, we may have to get public enterprise to prove what is there, and then it will be easy to get private enterprise to come along and take an interest. If we want to get others interested, it may be that, with the present shortage of capital (and I am one of those who believe that almost every penny of capital available ought to go into atomic power stations), we must put up some proposition that will induce them to come in. My case is that at the present moment they are not coming in. They answer: "To compensate me for the great risk of losing

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money I expect rich rewards if I am successful. I won't 'play' unless I have some financial concessions by way of tax remission or something of that sort." It is not for me or for this House to discuss tax concessions— that would be entirely inappropriate; but if we want private enterprise to come in, we must make it possible for them to do so. We have great inning houses who, I have every reason to believe, would be willing to chance their arm and develop some of these possibilities, if we made it possible for them to do so. I am sure that the taxation purists will say that this is impossible; that we have never done such a thing before, and that we cannot do it now. I would say that the circumstances to-day are such that at all costs we must develop our resources, and if it is necessary that we do it in that way, we must do it. If we do not like that way of doing it, then by all means let us do it by public enterprise.
I do not expect for a moment that I shall get a favourable reply from the noble Lord to-day. I am well aware that the country is not mineral conscious, and that it will take a good deal of education to make it so; but I hope that this debate will be a little step along the line of educating the country. I am only sorry that somebody who knows the facts much better than I do has not raised this subject. I believe that a considerable source of wealth lies in the ground and that, in view of our difficulties, we are unwise to leave it lying in the ground any longer without making some attempt to prove what is there and whether it is profitable to develop it. It is for those reasons that I move this Motion— which I need hardly say, I shall not press to a Division: it is moved simply in order that we may have some statement from the Government as to whether they think that these resources, if they are there— and I cannot say for certain that they are —should be investigated and, if possible, exploited; and, if they think it desirable, what steps they contemplate to make it possible. If we go, on as we are, doing to-day, these resources will not be developed in the lifetime of anybody here at present. My Lords, I beg to move for Papers.
5 0 p.m.
VISCOUNT HALL: My Lords, my name is down on the list of speakers to follow my noble and learned friend, but, having
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listened to his speech, I realise that he has covered the whole of the ground. and I shall not detain your Lordships for more than a few minutes. I entirely agree with everything that he has said in relation to this question of non-ferrous metals. It is said of us, as a great industrial nation, that while we may be mineral-minded up to a point, we are not metal-minded like the United States and Canada. The result is that we have not made use of the base metals which we have to the extent that we should, and are therefore importing from other countries some of the metals which could be produced in this country. In going through the list, I was surprised to find that non-ferrous metals rank third in the cost of our imports. No less than £ 230 million was spent last year in importing non-ferrous metals alone; and, in addition, scrap cost us something like another £ 30 million. From that angle alone, it seems strange that, if there are metals in the earth of this country— and T think there are— we Should not work them.
I am not a metal man, but I have had some experience in coal. I well remember in the 'nineties the inrush of Cornish on miners into South Wales; indeed, the Cornish tin mines were almost depleted of miners, for the reason, I suppose, that it was uneconomic to work those mines when compared with the cost of importing tin from other countries. The same can be said of lead and zinc. Arid it is not only the base metals that we have to think of at the present time. During the last fifty years there has been a complete revolution, entirely as a result of the work of the scientists, metallurgists arid engineers. Instead of having some six or seven base metals which we talked about and used before the turn of the century, we now have something between thirty and forty different kinds of metal in regard to which we require to keep abreast of other nations in the production of modern things. We have nuclear power, with uranium—there is no uranium in this country, so far as I know; we have the jet engine, and things of that kind.
I know that the Department of Industrial and Scientific Research is doing a substantial amount of work, but I wonder whether something more could not be done in connection with research and geological surveys in this country. I read

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in the last Report that something like 800 boreholes, to a total of something like 300,000 feet, were made by the Geological Survey during last year. It is true that in a half dozen instances we were told where those boreholes were made, but I would suggest that the places to concentrate upon are those places where we know the metals are to be found. Again, I saw in the Report that fifty major researches were reported. But that is all that was said. No idea was given as to whether the research was in the material, or for obtaining the material. I think we should have much more information about what is being done in this matter. We just cannot afford to spend something like £250 to £260 million a year on the importation of non-ferrous metals if this country has some of those metals lying dormant in the earth. I know that in the early days the metal workings, as in the case of coal, were haphazard and showed a lack of planning. In my own district of South Wales there must be millions of tons of coal left in the earth which is quite unworkable, solely because of the haphazard way in which it was developed and the neglect of planning.
Not only are we not metal-minded in this country, but we are not scrap-minded. One seldom sees anyone going round picking up scrap. There must be in this country an enormous amount of scrap of these metals which could be used, instead of our sending to America and other countries to bring scrap here. We do not seem to take the slightest interest in whether there is any scrap collection. I strongly support the remarks of my noble and learned friend. He has done a great service in raising this matter this afternoon, and I hope that the Government will do something to bring about a change in this situation.
5.10 p.m.
VISCOUNT FALMOUTH: My Lords, we are indebted to the noble and learned Earl who introduced this interesting discussion. The part of the world from which I happen to come has been closely associated for 2,000 years with tin mines. I was a little distressed to hear the noble Viscount, Lord Hall, say that we have never been mineral conscious. I do not think that is quite fair; I believe that until within the last eighty years we have
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been very mineral conscious indeed. After all, it was the Cornish mining engineers who developed the South African minefields. In fact, Cornishmen went all over the world, and it is largely due to their courage and their extraordinary know ledge— they could almost smell these minerals— that these great mining fields were developed. Since then, as the noble Earl has told us, there has been the sad picture of mine after mine shutting down. The value of minerals dropped in an incredible way. Between fifty and sixty years ago tin went down to a very low figure indeed, and the mines were forced to close. They were forced to shut up partly because the price was low, and partly because in those days they did not realise that any profit in the mine must be ploughed back if that mine was to have any period of life. That was not understood until fairly recently, so I do not think you can blame them if they made that mistake a hundred years ago.
The position is, of course, as the noble Lord has said: there is no encouragement whatever on the part of the Government for carrying out this risky undertaking. I am not quite so optimistic as the noble Earl about the resources in Cornwall, but there are undoubtedly resources. The lodes— I saw a good many of them when I was young— are narrow, rich and badly faulted, and the mines are very wet. They are extremely costly to work, and anybody who undertakes the working of them requires to be satisfied that, at any rate for the first few years, he will not be subject to an unfair burden of taxation during the risky period of development. I feel that a certain amount could be done, but I am nothing like so optimistic as many people. The reason why I think the matter is so important is that this country has always held a good position in the mining markets of the world. We have to train our miners, and if we have no metal mines in our own country, where on earth are we to train the young men to go overseas to develop these great fields? It is essential that we should try to have a few good metal mines in this country, in order that we may be able to train our young people. We want to encourage them, because this question of mining engineers to go overseas is an important one.

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The manufacture of mining machinery is, of coarse, a big industry. In the old days, when all the engineers were English —or, I should say, Cornish— they used to encourage mines overseas to send back large orders for machines to be manufactured in Cornwall. At the present time, these great mines are being developed by Canadians and Americans, and the English engineers are nothing like so common as they were. If we are going to keep up the export of mining machinery we must have some sources in this country where this type of machine can be tried out and developed.
It seems to me that, apart from this matter of supplies—and I am not so optimistic as the noble Viscount—the education and encouragement of young men to go overseas on mining propositions is vital. As your Lordships know, we have two or three important mining schools. There is the Royal School of Mines in South Kensington and the Camborne School of Mines in Cornwall. Both of these are important assets to the country and both of them are training young men to go out on these important jobs. The Government have been more far-seeing in some ways, because they have encouraged quite a lot of work on the examination of extraction problems of some of these complex ores. This question of extraction metallurgy is an important matter, and the Royal School of Mines has quite an important department examining these difficult problems. I hope therefore, that when the noble Lord replies on behalf of the Government he will give us some encouragement to believe that something will be done to try to strengthen the metal mining industry in this country. I do not want to see a great central body set up, which I am certain would cost a large amount of money, to examine these different propositions. I think it would be wasted. If we were to have a reasonable system of taxation we should, as the noble Earl said in his interesting speech, encourage some of the great mining companies to undertake examination of these Cornish propositions; and perhaps— as I sincerely hope—they would be successful and, instead of two mines in Cornwall at the present moment, we might have at least half a dozen.
5.17 p.m.
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR THE HOME DEPARTMENT (LORD MANCROFT): My Lords, I am sure we are all grateful to the noble and learned Earl for enabling us to have this unusual and interesting debate this afternoon. I thank him sincerely. I thank him also for not using the usual cliché that "it is one or two years since we had an opportunity of dealing with this matter." I cannot remember this matter being debated in your Lordships' House before, certainly in the fifteen years during which I have had the honour to be a Member. That, I am afraid, makes the noble Earl's first point. If we have not debated the matter for fifteen years, we can hardly earl ourselves a metal-minded nation, and certainly not a metal-minded House or Parliament. So we must give the noble and learned Earl full marks for the first hit which he aimed at us. I am grateful to him, therefore, for giving us the opportun4 of putting this right. I am also grateful to him personally for having done me the kindness of telling me in advance of some of the points he was going to mention, and of giving me the opportunity of reading Mr. Caunter's book, The Future of Metalliferous Mining in Great Britain. I am sorry to say that before this I was woefully ignorant— indeed, I do not think I know a great deal more about it now, although I ought to, because I know Cornwall well. I spend all my holidays there, and I know both St. Agnes and Geevor well. I know Malaya as well, and I have watched metal being mined and smelted in Penang. They have there, I think, the greatest tin smelting works in the world.
I think the noble Earl was a bit rash when he said that he did not know whether there was an expert in the House. There is always bound to be an expert in this House. He suddenly found the noble Earl, Lord Morley speaking about the Hemerdon company, The noble Viscount, Lord Falmouth, is also an expert on Cornish china clay, and I believe that the noble Viscount, Lord Stonehaven, is a mining engineer—perhaps it is as well for us that he is not in his place to-day.
The question which the noble and learned Earl put to us is this: do we neglect our non-ferrous industry, and should any Government, in particular

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this Government, show more interest, or should the taxpayer give more support? We have to admit readily that the industry now plays a much smaller part in this country than it formerly played. World, and indeed home, consumption has greatly expanded. At the same time, our home production, as the noble and learned Earl has conclusively shown, has fallen away. It is now only a fraction of what it was, and only a fraction of our consumption and our needs. Whether we can increase that production, given the best possible facilities and the removal of all obstructions, is a matter, I am afraid, for the experts. The evidence available to me tends to agree more with the view of the noble Viscount, Lord Falmouth, than with that of the noble and learned Earl, but we will not argue about that. How much more could be produced from Cornwall in particular, and from the country in general, is at the moment a little academic. Certainly it would require a great deal of extra working and work, and a lot of money.
What is the reason for this decline? The first reason, I think, is obviously the exhaustion of the rich and the easily extractable deposits, so that we are left now largely with the poorer and more difficult ones. The second reason is the competition and the increasing exploitation of richer resources overseas. Again, I think the noble and learned Earl was a little pessimistic. I have heard tell also that some of the mines in Malaya will run out in twenty years, but some mines are "an unconscionable time a'dying." I believe that there are also large untapped resources in the world of which at the moment we know only a little. Undoubtedly, it is desirable to encourage our home supply, provided that this can be done at competitive prices.
The noble and learned Earl accused the Government— and he was fair enough and kind enough to accuse, in retrospect, his own Government— of having no metal policy at all. Our policy is perfectly clear. It is that we must have a maximum supply from the most economic source, wherever that source may be. I think that that policy at the moment must be right, because it is essential to maintain and improve the competitive strength of our economy. I say that with some confidence,
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because I know, as your Lordships know full well also, that it is fortunate that the large proportion of our requirements are available to us in the Commonwealth and from the sterling area. We have now to ask ourselves this question: is it in the general national interest to give this particular industry exceptional, and perhaps even artificial, help which may be economically unsound and unbusinesslike? The situation, of course, might be quite different— I readily admit that— if our supplies did not come from the Commonwealth or the sterling area. There is always the question of the war-time problem. There again, I think that home production, even at best, would make only a very small impact on our demands. The strategic consequences of this fact are obvious, particularly in respect of shipping priorities, which would have to be granted in any case.
The noble and learned Earl asks: what are the Government going to do about it? What should be this Government's role in this particular problem? The noble and learned Earl and other noble Lords who have spoken have mentioned the Geological Survey and Museum. That, of course, plays the principal Government part. It provides, in addition to its annual surveys, the basic information on all aspects of British geology, particularly those of service to the economic prosperity and development of the country. The noble and learned Earl mentioned their Report on the Metalliferous Mining Region of South-West England. This last publication provided light week-end reading for me, and I recommend it most cordially to your Lordships who have a light week-end ahead. It provides an extraordinarily detailed and useful amount of information. The noble Viscount, Lord Hall, paid tribute to this organisation. I should like to join him in saying that they do wonderful work, most of which is unknown to the man in the street. The noble Viscount, Lord Hall, asked if they could not give reports on more boreholes in Cornwall. I will certainly look at that and bring it to the attention of my noble friend the Leader of the House who is responsible for the Department of Scientific and Industrial Research.
If your Lordships go through these publications of the Geological Survey, you will note that their work is basic,

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but further steps in mineral development must be governed at each step by the prospect of economic return. Perhaps only one in a hundred prospects such as the noble Viscount, Lord Hall, and I have been talking about will lead to anything. That, we maintain, is a matter for commercial judgment and not for a Government Department. We honestly think that nationalisation or any other extreme form of Government interference would not of itself turn an uneconomic project into an economic operation. I seem to have heard those words before, and they seem to be as true now of this particular industry as they ever have been. The noble and learned Earl fairly suggests that private enterprise should be given its full chance. I certainly should not argue that private enterprise is falling down on its job—far from it. The mining companies continue to be very active indeed in exploring, both here and, incidentally, abroad. The Government do not pretend to have more technical skill and "know-how" than those who are experts in it.
I was glad to hear the noble and learned Earl, Lord Jowitt, quote from a passage in the Westwood Report the observations of my right honourable friend the President of the Board of Trade, who was then, seven years ago, only a Back Bencher. I should like to give his words. Mr. Peter Thorneycroft said:
"I would, however, advise any Government— to think well before it ventures public funds upon so hazardous and speculative a form of enterprise."
There used to be a song when I was a child: "Don't go down the mine, daddy!" That seems to be, in polite language, what Mr. Thorneycroft was then advising the Government to do. His advice in his present capacity is still the same. I think most of us would be happy to think that what we said seven years ago, on the other side of the House, should be so well worth while repeating in another capacity to-day.
EARL JOWITT: I hope the noble Lord will not answer me on the basis that I have advocated or asked for public enterprise in this matter. I have merely said that if you eliminate public enterprise, for reasons which I can well understand, and which Mr. Thorneycroft gave, then you are left with private enterprise. Then what I say is: make it possible for private
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enterprise to do the job. Then I shall be perfectly content.
LORD MANCROFT: I am obliged to the noble and learned Earl. I take his point, which I think is perfectly fair. He and I have agreed that this is not a good field for the intervention of public enterprise: the risk is too great and the technical knowledge is not with Government Departments. This would be a bad ground for Government intervention. Very well then. What assistance do we give to private enterprise to encourage them?
The noble and learned Earl mentions taxation. That, of course, is all-important. I think he rather suggested— and those of his way of thinking agree — that further support would have been forthcoming under a less onerous or less "prejudiced" taxation system. In point of fact, as f think the noble and learned Earl suggested, very fairly some useful concessions have already been made. There was the 1945 Act which allowed expenditure on exploration, developments, shaft-sinking and the like to be written off for taxation purposes over the life of the mine. The Westwood Committee considered that the lack of such pro vision was a major financial handicap. There have been other changes since then. Allowances have been given for plant and machinery used for exploration and for expenditure on abortive exploration outside the source being worked. That was in 1952. In addition, when the initial allowance was restored by Mr. Butler, who was then Chancellor of the Exchequer, in 1953, mining works—that is, pit shafts, buildings, roads and so on—were giver, the exceptionally favourable rate of 40 per cent.
I come now to the Royal Commission on Taxation of Profits and Income. In their Final Report, which was issued last year, they considered the whole of this question. The Commission recommended that a depletion allowance should he given in respect of the cost of acquisition of mineral rights or areas. On the other hand, they did not favour any of the schemes for special depletion allowances such as operate in Canada and elsewhere. These are not, of course, allowances for expenditure actually incurred, but simply a method of taxing mining concerns at lower rates than other industries. My right honourable friend

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the Chancellor of the Exchequer is examining the Royal Commission recommendation that an allowance should be given in respect of the cost of acquisition of mineral rights. He will take into account the views expressed in this debate. I think the noble and learned Earl used the expression res ipsa loquitur. I may give him the answer, if my Latin is good enough, Res Cancellario locuturaest— in other words, I will bring the point to the notice of the Chancellor of the Exchequer.
My Lords, should there still be some further concessions? Is there ground for even a complete "holiday" from taxation? Certain protagonists in the battle have suggested that though I do not think the noble and learned Earl went so far. We are all agreed, I think ("Sunny Jim" was quoted in support), that taxation generally is too high. Some people want us to have a general "holiday" for the mining industry. Why stop there? What about the rival claims of shipping, agriculture or, indeed, the export trade as a whole? My Lords, I am not convinced that the mining industry merits a special privilege of that sort, and I must reject that idea as a whole. Of course, what we want, as the noble and learned Earl has said, is to attempt first to create the economic conditions for a general reduction of the whole burden of taxation. Nobody agrees with that more heartily than I, but I think we have done a considerable amount to help in this respect. We will look again at this particular point and see that all that possibly could be done has, in fact, been done.
I have been talking hitherto largely about tin, because that, I think, was the principal metal which we had in mind. But, of course, these points that I have made about taxation apply equally to the other metals we have discussed this afternoon— for instance, lead and zinc, which some noble Lords have mentioned. There again, our output is small compared with our consumption. There are only about five mines in production, and there is investigation and development on five or six more sites. Dumps on some past workings are, I understand, being treated by modern process to extract the remaining metal content, and we are watching these developments with interest. It is
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no good pretending that this is a major industry.
Several noble Lords mentioned tungsten. I do not think any mine operates primarily for the production of tungsten ores. Domestic deposits in this country are very small, and they are generally operated only in war time. The Westwood Committee discussed the case of the larger deposit containing low-grade tungsten ore and also a little tin at Hemerdon, near Plymouth, which the noble Earl. Lord Morley, knows about. As the House now knows, fresh attempts have been made to overcome the existing technical difficulties. I am told that a new process has been developed and the venture now looks a good deal more attractive commercially. The Board of Trade are now negotiating the disposal of the assets to a commercial operator. We shall watch its future with interest.
I turn now to potash, which the noble and learned Earl referred to. I understand that I.C.I. and Fison's (who, I understand. were the other firm) have devoted a great deal of activity to their investigations on deposits near Whitby in Yorkshire. The noble and learned Earl referred to that. They have both now reluctantly decided to abandon their experiments. Over £ 500,000 has been spent in testing the possibilities in this deposit, and I think that if two firms of that size and business and commercial intelligence have to abandon it after spending that sum, it serves only to reinforce the point which my right honourable friend the President of the Board of Trade made in the Westwood Report. The economic problem might possibly be more favourable in the future, I am told, in which case further investigation might be carried out; but at the moment I am afraid that the project has been abandoned.
This brings out a rather interesting point: it has been abandoned, but it is not a wasting asset. All these mineral deposits are not wasting assets; they are merely lying fallow because the economic situation dictates a more favourable state of affairs overseas, in the Commonwealth and elsewhere. If the forebodings of the noble Earl concerning the world's supply prove true, and if his optimistic guess that the amount that is lying under our soil also

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comes true, still no great harm is done in allowing them to lie fallow. It may then be necessary to open up much greater development and to adopt another policy, but at the moment I do not think that the case is wholly proved.
Naturally, we should like to see an expansion of the domestic non-ferrous mining industry if it could be achieved on a competitive basis. I have mentioned the helpful taxation concessions which have been already granted. I have mentioned the further concession which has been recommended by the Royal Commission and which is under consideration by the Chancellor— a consideration which will be more in the forefront as the result of the debate in your Lordships' House. But I am not wholly convinced. I must confess, that more favourable taxation concessions on any wide or far-reaching ground could be granted; not even from the evidence which I have studied in the last few days, nor, I am afraid, from the eloquence and the advocacy of the noble and learned Earl.
We have all emphasised that this is a highly speculative trade. It is one which we on this side of the House feel is quite inappropriate for Government intrusion. "Nuts on the ground" were, in all conscience, expensive enough to the taxpayer; I am afraid that metal under it might prove even more expensive. On the other hand, if other steps could be shown to be desirable in the interests of expanding home production, Her Majesty's Government would naturally consider them most sympathetically, provided the expansion is on a competitive basis. It is a truism to say that our national prosperity depends greatly on the efficiency of our engineering production. I think it would be foolish to base our non-ferrous metals policy, with which, of course, it is closely linked, on any other principle than that of obtaining these metals from the places, whether at home or abroad, where they can be produced more cheaply and efficiently than anywhere else, even under our own ground.
My Lords, without wishing to appear in any way unsympathetic to an oldestablished—nearly two thousand years now—and a once major industry, I think that Her Majesty's Government's policy is both sensible and right. But if circumstances should change, there is no
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reason why we should not change our out look, as no harm is done in waiting. At the moment, I feel, though I must express some sympathy with the point of view that the noble and learned Earl has put forward, that, on the whole, and thinking in terms of the interests of the general economy of the country, the Government's present policy is right.
5.37 p.m.
EARL JOWITT: My Lords. I am most grateful to the noble Lord for the trouble that he has taken to answer me in this debate, though I must confess that I am disappointed with the reply that he has made. He thinks that the Government policy is right. I wish he had conveyed to me what the Government's policy was. My whole grievance was—and still is— that they have no policy at all. He asks "Why should we give tax concessions to the mines which we do not give to shipping companies?" But why should America do that? Why should Canada do it? Why should Australia do it? Why should Ireland do it? When he sees what staggering effects the Irish concessions have had, and how Ireland and the tax officials are going to benefit the fact that they are developing a new and large industry in Ireland, it seems to me that there is no reason whatsoever for taking the attitude which he has taken. However, there it is: that is the attitude which the Government take.
The only crumb of comfort that I can take to myself is that the Chancellor of the Exchequer is going to read what we have said in this debate. I certainly hope that he does. I certainly hope that he will consider what has been done in Ireland. Of course, the Government are right to get their minerals and metals in the cheapest market. The point of introducing private enterprise into this matter is that they would not venture their money unless they thought that they would be able to produce cheaply. If you gave them tax concessions, and they were able to produce cheaply, they would cone in only if they thought they could produce it more cheaply than other sources of supply. If that was not so, it would be foolish of them to consider the matter at all.
My Lords, as I have said, I am grateful to the noble Lord. This is the first time in seventeen years that we have had a debate on this sort of topic. I hope I have got the door open, just a fraction,

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and that if I, or somebody else, continues to raise the subject, we shall get the door so far open that at last we may be able to get a foot inside; and then, perhaps, when the situation becomes even more critical and difficult than it is today, somebody will say, "It is about time, notwithstanding all the previous
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answers, that we began to develop our own resources in our own country." My Lords, I am obliged to the noble Lord and to noble Lords who have spoken. I beg leave to withdraw my Motion.
Motion for Papers, by leave, withdrawn.
House adjourned at twenty minutes before six o'clock.