HL Deb 05 February 1957 vol 201 cc423-53

3.4 p.m.

Order of the Day for the House to be again in Committee read.

Moved, That the House do now resolve itself into Committee.—(The Earl of Perth.)

On Question, Motion agreed to.

House in Committee accordingly.

[The EARL of DROGHEDA in the Chair.]

Clause 3:

Consequential modifications with respect to development schemes, etc.

3.—.(l) No scheme shall be made on or after the appointed day under the Colonial Development and Welfare Acts, 1940 to 1955, wholly or partly for the benefit of Ghana.

(2) Any scheme in force under the said Acts immediately before the appointed day which was made solely for the benefit of Ghana or any part thereof shall cease to have effect on that day without prejudice to the making of payments in pursuance of that scheme on or after that day in respect of any period falling before that day; and, so far as practicable, no part of any sums paid out of moneys provided by Parliament for the purposes of any other scheme made under those Acts before that day shall be employed in respect of any period falling on or after that day for the benefit of Ghana.

(3) Nothing in the two foregoing subsections shall restrict the making of, or the employment of sums paid out of moneys provided by Parliament for the purposes of, any scheme under the said Acts with respect to a body established for the joint benefit of Ghana and one or more of the following territories, that is to say, the Federation or any Region of Nigeria. Sierra Leone and the Gambia, in a case where Ghana has undertaken to bear a reasonable share of the cost of the scheme.

(4) Without prejudice to the continuance of any operations commenced by the Colonial Development Corporation in any part of Ghana before the appointed day, as from that day the expression "colonial territories" in the Overseas Resources Development Acts, 1948 to 1956, shall not include Ghana or any part thereof.

Debate resumed on an Amendment moved by Lord Ogmore on Thursday last, to omit subsection (4) of Clause 3.


It has been thought convenient, as there is a legal aspect to this Amendment, that I might deal as shortly and clearly as I can with the matters that arise on this point. May I just remind your Lordships of the position that obtained when the debate was adjourned on Thursday? I think it can be summed up in this way. First, all sides of the House had welcomed the undertaking which my noble friend Lord Home gave on behalf of the Government, that we would make a comprehensive review of the United Kingdom rôle in the development of new, independent Commonwealth countries, and that this review would cover the form which any service or other facilities might take, including any possibility of adapting those facilities which already existed for this purpose. The Committee will find my noble friend's account of this in the OFFICIAL REPORT, Vol. 201 (No. 27), columns 355 and 356, and your Lordships will appreciate and, I think, did appreciate, the necessity of having the whole subject considered.

Second, while the noble Lord, Lord Grantchester, spoke in favour of retaining Clause 3 there remained, despite the arguments advanced by the Government, a strong feeling on the part of other speakers, both from the Opposition side and from this side of the House, that the clause was open to criticism. I will not attempt to restate the nature of the criticisms that were made, which I am sure are familiar to your Lordships.

Third, my noble friend Lord Home, made it quite clear that the Government adhered to their decision, that until the review to which I have referred had been concluded and decisions arising from it had been made, the policy embodied in the clause must stand. On the other hand, if and when it were decided to make any changes in policy, those changes would, as far as necessary, be given effect through appropriate legislation.

As a result of this situation the suggestion was made by my noble friend Lord Swinton, and endorsed on behalf of the Opposition by noble Lords opposite, that it would meet with the approval of this House if the Government were to withdraw the clause, on the understanding that, until the review to which I refer had been completed and decisions taken in the light of that review, the results which it was intended to achieve through the enactment of Clause 3 would instead be attained through administrative action. Your Lordships will find my noble friend's proposal at Column 366. It was my understanding—I believe I have correctly interpreted the varied expressions of opinion that were made—that this suggestion was designed to avoid the inclusion of essentially negative provisions in a Bill with the great positive purpose of creating an independent Ghana. At the same time, this suggestion was designed to avoid prejudicing the decision that would be made by the Government and no doubt debated by your Lordships' House on the wide issue after the general review.

This was a suggestion which, though it had not previously recommended itself to my noble friend the Secretary of State for the Colonies, the eloquence of noble Lords persuaded us should be further examined, and accordingly my noble friend Lord Home undertook to examine it further, although I should stress that he made clear that he might not be able to do anything else but report that the clause must stand. 13efore I go into it further, may I emphasise that we in the Government entirely recognise the sincerity and depth of feeling of the arguments that have been adduced against the clause, even though we do not agree with them? I am not going to put this on a matter of the time-table. Although I think everyone in the House appreciates the difficulty of the time-table, it might be surmounted by certain measures if everything were agreed upon. But I do not want to put it in that way; I only want to remind your Lordships that I think we are all desirous that this matter should be got through in order that the date, which means so much to Ghana, should not be affected in any way.

I should like to say to my noble friend Lord Swinton that we have given this matter the most serious consideration. I have considered, with my right honourable and learned friend the Attorney-General, the legal aspects. Apart from that we have tried to find some method by which effect: might be given to the suggestion made by my noble friend.

Knowing the legal origin of my noble friend Lord Swinton, although it is overlaid now by many years of public service, I hope that he will believe I am doing him the justice of trying to present the matter as clearly and objectively as I can. I should also like to deal with doubts that my noble friend Lord Rennell had on other aspects of the matter.

The legal background starts, I think, with the Colonial Development Act, 1940. That enabled schemes to be made for promoting the development of any Colony; and in the Act of 1940 "Colony" was so defined as to exclude Colonies possessing responsible government. This is one of the difficulties in considering this matter. That limitation was repealed by the Act of 1950, and for the purpose of these Acts, therefore, "Colony" has the meaning given it by Section 13 of the Interpretation Act, 1889, as amended by Section 11 of the Statute of Westminster, 1931, namely: Any part of Her Majesty's Dominions outside the British Isles with the exception of Canada, Australia, New Zealand and South Africa. In other words, for the purpose of the Act of 1950 a grant under the Colonial Development Act cannot be made for the benefit of Dominions under the Statute of Westminster.

Then one comes to the Overseas Development Resources Act, 1948, which set up the Colonial Development Corporation for securing development in colonial territories. By Section 19 of that Act your Lordships will see that it applies to territories to which the Colonial Development and Welfare Act, 1940, applied—I emphasise that the word used is "territory" with its geographical connotation—at the time of the passing of the Act of 1943. So that there is no distinction between the territories to which grants can be made under the Act of 1940 and those in which the Colonial Development Coroporations may operate. Your Lordships will appreciate that I have just picked up the point that at the commencement of that Act of 1948 Ghana had not responsible government. My noble friend Lord Rennell may have had in mind the fact that there is no provision comparable to Clause 3 in the Ceylon Independence Act, 1947. If the noble Lord had that in mind, may I just remind him of the date—it was 1947, before the repeal of the provision which I have mentioned.

There was therefore no need for a provision in 1947 because as I have mentioned, "Colony" in the Act of 1940 meant a Colony not possessing responsible government; but this restriction has now disappeared.


Does that mean that Ceylon was included in the provision of the Colonial Development Act, 1940, and that India was also included, because those countries were not specifically excluded?


In 1947, Ceylon had responsible government and therefore automatically moved into the exception to the 1940 Act which excluded from Colonial Development operation those territories which had responsible government.


What of India?


I believe the position would be the same, but I thought the noble Lord had Ceylon in mind.


That was so.


It was for that reason that I thought the point should be verified. That is the explanation. My noble friend Lord Rennell also said, during the Committee stage (I believe at column 369 of the OFFICIAL REPORT [Vol. 201, No. 27]), that there was no need for Clause 3 (1) because of the definitions of "Colony" in Clause 4. On that subject, may I point out to the noble Lord that Clause 4 is subject to the words he will find in line 3: in any Act of the Parliament of the United Kingdom passed on or after the appointed day… It is thus clear that, apart from Clause 3, Ghana would be included for the purposes of Acts passed before the appointed day. The noble Lord will find that that is borne out by the proviso to Section I which deals with certain aspects of the matter. If I may say so with the very greatest respect, the reason why I feel that the noble Lord was wrong on that point is because all that Clause 4 says is that a "colony" in any Act passed on or after the appointed day is not to include Ghana. It is quite clear that unless Clause 3 is kept in the Bill these Acts will apply to Ghana.


Hear, hear!


I now come to the point raised by my noble friend Lord Swinton. It has been suggested, with regard to the Colonial Development Corporation, that if Clause 3 (4) were dropped it would still be possible for the Secretary of State to give a direction under Section 9 of the Overseas Resources Development Act, 1948, that would have the effect of excluding Ghana. This is where the legal troubles begin. Section 9 is deceptively wide at first sight, and I appreciate the noble Earl's view. It says that the responsible Minister may, after consultation with the Corporation, give to them directions of a general character as to the exercise and performance of their functions in relation to matters appearing to him to concern the public interest… With his great and varied experience in the war, my noble friend Lord Swinton no doubt had in mind the many things which were done under similar provisions; and that was a point which I considered. I believe however, that, when he has considered the matter, the noble Earl will agree with me that, in order to be valid and effective, general directions can, as a matter of principle be given only within the framework of an Act and not so as to restrict or reduce that framework. That is the difficulty which my right honourable and learned friend and I have found.

It is difficult to believe that Parliament ever intended that this power should be exercised in such a way as to impose a rigid restriction on the class of territories entitled to benefit under the Act, and therefore the first point is that, despite the width of the words, there would be a real difficulty on the vires of any direction—because, as I say, it is not within the framework of the Act. Quite apart from this, it would seem, in principle, undesirable to delete subsection (4) if in fact it was intended that the object of that subsection should be attained by means of administrative direction. It would not help, as I am sure my noble friend will appreciate, an argument on the vires if that were the course that had been taken. I hope that I have not wearied the House too much, but I wanted my noble friend to appreciate that I had given the fullest consideration to this point.


May I put a question to the noble and learned Viscount upon what he has just said? I fully follow his argument that a general direction quite as wide as that which was proposed by the noble Earl. Lord Swinton, would encounter the difficulties to which he has referred. But is it not the case that it would still be possible for the Government, to stop particular projects, exercising their administrative discretion—not doing it as to 100 par cent. of all cases that might be raised, but doing it in fact to project after project, and influenced in their decision, to some extent, by a policy declaration already made: that they thought that, in the absence of exceptional circumstances, it was right and proper that a territory which had acquired this status should acquire creditworthiness and raise by other means any money needed?


Naturally we have given great consideration to the point which the noble Lord, Lord Salter has raised. I would remind him that we are here dealingex hypothesiwith territory that has become independent; and the difficulty of exercising what is, in effect. normal Treasury control across the line of an independent Dominion is. I think, very great indeed; and the personal difficulty in which a Minister would be put in those circumstances is infinitely increased. I ask my noble friend to consider the point—his administrative experience is much greater than mine—abut I should have thought that it was an almost intolerable burden to put on a Minister in these circumstances. I very much doubt whether an attempt to exercise ordinary Treasury control across the bounds of independence is really a practicable matter.

I am afraid that what I have said will come as a disappointment to the noble Lords who put forward this proposal in so constructive and helpful a spirit. But I have to say, having given it all the consideration we can, that we have come to the conclusion that we cannot adopt it; and I trust that your Lordships will accept what I have said on this point. In these circumstances, may I urge one consideration upon your Lordships? Although some of your Lordships may be disappointed at this outcome, they will see that the retention of the clause does not conflict with the purpose behind the alternative proposal put forward by my noble friends and supported by noble Lords opposite. I wish to say again that the Government abide by their undertaking to implement whatever decisions may be reached for a general review, including the introduction of any legislation which may be found necessary for that purpose.

Therefore, I would ask your Lordships not to let us give the impression that we feel that our good relations with Ghana and other emergent territories are going to be damaged by a clause which does those very things which your Lordships would have been prepared to accept if they had been done by administrative action. Let us, instead, put our confidence in the good will and understanding of the Ghana Government who will, from the Record of the Proceedings in this House, be able to see how much good will exists towards them in this House, as well as the reasons why the clause is being adopted. In view of the consideration we have given, and the difficulties we have found, I ask your Lordships to allow Clause 3 to stand part of the Bill.

3.27 p.m.


Not only those of us who were responsible for the Amendment but many others of your Lordships in other parts of the House will be gravely disappointed with the terms of the comment which has just been made by the noble and learned Viscount the Lord Chancellor. II is true that an agreement was reached between myself and my colleagues, on this side of the House, and certain noble Lords opposite, who hold strong views, that there would be an arrangement under which for such period as dated from the passing of the Act up to any conclusions of the Dominion Conference which you are proposing to hold, you could do by administrative action what the clause is designed for.

But that was not really the original case put forward in moving the Amendment. It goes much wider. We were grateful to those noble Lords opposite who, I think, had similar views to our own, to find amongst them a compromise at the moment which would enable the Bill to go back to another place for reconsideration—that would be established by having an Amendment to the Bill—and avoid something upon which we felt very strongly indeed: the starting off of what ought to be the great, bright future of Ghana with a sorry spot of this kind. We are exceedingly sorry to note that, apparently upon completely legalistic grounds, the Government take this attitude. I repeat that they seem to be doing so on completely legalistic grounds. It seems to us that the Government, in considering these matters and the form the relevant legislation should take, have been greatly lacking in their examination of matters that might be expected to arise. To have a measure now presented to us with so great a danger of harmful effects in Ghana is indeed most regrettable.

There is an article inThe Times to-day which I hope all noble Lords have read and which supports to the full from West Africa the arguments put forward from both sides of your Lordships' House last week. What we were greatly concerned about was that the Government are, by a special piece of legislation, putting Clause 3 into a Bill which is to grant independence for the first time to an African native territory. They are drafting special new legislation to go into an instrument by which they are proposing to give independence for the first time to a native African territory, and they take all the sugar off the gift by putting this into the Bill. I should have thought that there would have been some imagination left somewhere in the ranks of the Government which would have produced what was going to be necessary for the assistance of a territory of this kind, and that there would be no cause for a dispute such as we have now.

I really am greatly disappointed. I have in mind what the leaders of Ghana may think. They will. I am sure, want to enshrine the beginning of their independence granted by the United Kingdom, the centre of the Commonwealth, with a great deal of ceremony, with a great deal of loyalty and with hopes in all hearts of building it on a sure foundation. The document will be specially prepared, no doubt, upon a piece of parchment. But the instrument enshrining that independence will take away many of the rights of assistance to a great new territory, the first African native territory, and one which for the past five years has been one of the greatest contributors to the stability of the sterling area by the manner in which the people there have administered their industrial and financial affairs. I very much regret this, and before going into a detailed discussion of the clause as a whole the Committee should have an opportunity of expressing their view.


I think the Committee will appreciate that the Government have given deep, sincere and sympathetic consideration to the project which I advanced on the last occasion. Indeed, from what the noble and learned Viscount the Lord Chancellor has said, I think it is plain that if this had been legally possible, it was a course which the Government would have been ready to accept and which the whole Committee would gladly have endorsed. Certainly we are all grateful 'to the noble and learned Viscount for having put so clearly and fully to-day the arguments which have weighed with the Government. I think that the noble Viscount the Leader of the Opposition was less than fair to the Government when he said that now, at the last moment, this hopeful solution was turned down on purely legalistic grounds. Of course, it may be said that although my solution, if I may venture so to call it, was put forward only on the last occasion that we debated this subject, the Government discuss all these things with their legal advisers beforehand and ought not to have been taken by surprise; but I do not think that we ought to press that point. Certainly it was a novel suggestion, and the Government have given it full consideration.

I do not think it is reasonable to say that it has been turned down on purely legalistic grounds, as if that were a sort of excuse that could be got round. As I understand it, the position is really this: if my noble friend the Secretary of State purported to give a direction of the kind that we all hoped last time he would be able to give he would be doing something ultra vires and illegal, and what would happen would be that he would be taken to court and the court would be bound to hold that he had no power to do this. Therefore, his order would be set aside. The noble and learned Viscount the Lord Chancellor was very kind about my legal experience fifty years ago or more, but I certainly am not going to set myself up—I do not think anybody in this country would—and say that if, after careful consideration, the Lord Chancellor and the Law Officers of the Crown find that a thing is illegal and the Secretary of State has no power to do it, we should not accept their finding, Frankly, that is a situation which we have to accept.

Nor do I think it would be reasonable, and certainly I should not like to do it, to advise a Secretary of State that he should, so to speak, "get round" the fact that he does not possess dispensing or excluding power, by saying, in nine cases out of ten, "I turn down that particular proposition." I am sure, and I ask the Committee to accept this from one who has had a good deal of experience in dealing with cases of this sort, that that would put any Secretary of State in an impossible position. He would not be turning things down on merits; he would be turning them down by a side wind. All the views which my noble friend the Secretary of State advanced last time about an open declaration that he was not going to give any permission—which I do not accept—would be present on this occasion, and they would lead to the most hopeless misunderstanding. I am glad that we have had this debate, because it has shown the general consensus of opinion on what you: Lordships would like to do. This short debate will be read and appreciated by the people of Ghana as well as by the people here and will show the people of Ghana that we have tried to arrive at what I believe would be a fair compromise—namely, that we should hold our hands and, pending this inquiry as to the future of the finances of these emergent territories, no action should be taken.

For my part, I think we have to accept this position. I would only say to my noble friend the Secretary of State—and I am sure that he would be ready to give your Lordships an assurance on this point—that this is all the more reason for pressing on rapidly and aggressively with the inquiry into what ought to be the whole system of finance. I do not think that it requires an Imperial or Commonwealth Conference; that takes a long time to assemble. I am sure that a great deal could be done by the exchange of telegrams. May I venture to suggest that everybody might agree to have a practical working party constituted, of Commonwealth representatives and representatives of the financial corporations who are dealing with these issues, to work out a practical plan which could be submitted to our Government and to all the Commonwealth Governments. We might get rapid action in that way and an agreement which would produce a new plan for getting the best out of the existing organisations, adapting them and combining them to meet any propositions which would help these emergent territories. I believe that that could be done rapidly, and that it would be clearly understood in Ghana, after this debate, that that was all that could be done. Then the Government could come back and pass as rapidly as possible an agreed measure which would give us all that we want.

3.38 p.m.


My Lords, I am extremely grateful for the trouble which the noble and learned Viscount the Lord Chancellor has taken in disentangling what is, frankly a complicated situation. He has produced what is, for me, a new fact: that at the time of the passing of the Colonial Development and Welfare Act, India and Ceylon were not then excluded and were only excluded thereafter, and at that time the Act could have been made applicable to India and Ceylon, too. I must accept entirely what the noble and learned Viscount and the other advisers of the Government have said on this subject.

I remain disappointed, naturally, by the outcome, and I remain equally disappointed by the terms of the drafting of Clause 3. Whether or not the same effect could have been produced by other means, it is drafted in an extremely gauche and somewhat discourteous manner. I believe that if the information which had been collected by the noble and learned Viscount and his legal advisers had been taken earlier, the terms of the drafting of Clause 3 might have been substantially different from what they are and might have occasioned less turmoil and trouble than the clause undoubtedly has done.

I would not wish to do anything which would in any way jeopardise the coming into force of the Ghana Independence Bill at the appropriate time or in any way to risk delay in the drafting of the Order in Council which the Secretary of State has promised will be drafted and presented in the near future, but I hope that the remarks which the Secretary of State for Commonwealth relations made in the course of the Committee stage debate about using existing machinery and existing services so far as possible, may be carried into effect and made use of pending the time when a new set-up and new legislation is enacted to enable these emergent territories to be properly financed.

3.40 p.m.


My Lords, I should like to offer a few comments on the new arguments that have been put before us to-day. I have heard, with great regret, that the Government feel that they must keep this clause in the Bill. Of course, I accept without question the whole of the legal argument that the noble and learned Viscount the Lord Chancellor put before us; it would be impertinent of me to do otherwise. In fact I entertain no doubt in my own mind as to the absolute correctness of his argument, and I accept, as a conclusion from that, that the particular proposal made when we met last Thursday by my noble friend Lord Swinton is not really practicable; that is, a general direction that until a certain time there should be no acceptance of any scheme for Ghana under the Colonial Development Corporation.

But I wonder whether that necessarily carries the further conclusion that the clause must be retained. I should like to ask the Lord Chancellor this. Is it not the case that, consistently with his argument, it would be possible, by administrative action, to prevent any particular loan project from going through; possible for the Corporation itself to stop it; possible for the Government to stop it; and possible for the Government to give warning to the Corporation that they would stop it, so as to prevent a great deal of preliminary work from being engaged on it?

Secondly, if that is true, as I suggest it is, would it not be possible for the Government to state their general attitude and principles, with which I entirely agree: namely, that the normal position for a country which has acquired the status that Ghana will have should be to establish its own credit-worthiness and borrow by other means? Having stated that principle, would it not be perfectly proper to exercise discretion on a particular project, taking into account all considerations; not only the intrinsic prospects of the particular project, but also the fact that the territory which is asking for the loan is a Ghana territory and not a colonial territory? What I suggest is, not to adopt the precise solution that my noble friend Lord Swinton suggested before, but (a) to drop the clause; (b) to make a declaration of what the Government understand to be the natural consequences of the acquisition of Ghana's new status; and (c) that, with that declaration in mind, both for Ghana and for ourselves, the different projects as they come along, should be watched, and not agreed to under exactly the same criteria as would apply if the same project had been put forward in respect of a colonial territory?

I suggest that that is legally possible; that it is quite consistent with the argument of the noble and learned Viscount on the Woolsack; and that it is highly desirable that it should be done, for reasons that I will come to in a moment. I fully agree with the Lord Chancellor that that imposes a difficult administrative decision upon Ministers at the time; and unless there were strong reasons for retaining discretion, I agree with the advantages of a statutory provision which would deprive the Government of that discretion. But is there not, in the prospect ahead of us, a considerable reason for saying that there should be some discretion in the Government of the day, at least until the time which may follow the inquiry which the noble Earl has promised us, when adequate alternative machinery will be immediately available?

I would ask your Lordships to look forward to the possibilities of the next few years. Ghana, and other countries, like Malaya, which may acquire a similar status, should expect to borrow their own money by other methods. But can we rely upon that being possible immediately this Act comes into force, or the relevant Act for other territories? Can we anticipate exactly how urgent or important it may be, perhaps before any satisfactory alternative method or mechanism is in being, that we should be able, in a particular case, to exercise a discretion in favour of allowing a loan to go through? Can we anticipate what are the possible alternative sources of capital from abroad for that Ghana territory, and exactly how politically desirable or undesirable it may be that they should have recourse to those alternative sources? I am not sure. Can we anticipate exactly how delicate may be the negotiations that we may be engaged in at the time in regard to relationship of the Ghana territory to the Commonwealth generally and to the sterling area, bearing in mind the importance to the whole of the sterling area and its dollar position of the cocoa earnings of West Africa and the rubber and tin earnings of Malaya?

I do not say that that situation will arise. I do not say that, except in the case of necessity, the Colonial Development Corporation should be used for territories of this kind. But is it wise that, by a statutory provision, the Government should tie their hands? In the twenty years or so that I have been connected with Westminster, this is, I think, the first time that I have ever urged the Executive to take or retain more power under current legislation than they themselves wanted to have. But here I suggest that, until alternative methods are ready and known to be ready, this limited discretion might usefully be retained. Except for what I admit to be the administratively difficult but, as I think, in the circumstances, necessary task which would fall on Ministers at the time, I cannot see any decisive reason why the Government should ask us to tie their hands. If I find a friend in great distress calling upon me for assistance, I do not think it is a very good answer to him to say: "I am sorry; I would have run to your assistance, but my hands have been tied", if he knows, and I know that he knows, that my hands have been tied at my own urgent request.

3.49 p.m.


My Lords, on the Second Reading of the Bill my noble friend Lord Rennell and I raised this question—and I must apologise to the noble Lord who moved the Amendment on Thursday last that I was unavoidably prevented from being here. To-day I have listened carefully to what the noble and learned Viscount on the Woolsack has said, and I think we must accept the legal position as he has outlined it. The point that struck me as being of importance is that raised by my noble friend Lord Swinton, when he said it was tremendously important that the review which has been promised by the Government should be held at once and that there should be no delay. I think that what the noble Viscount the Leader of the Opposition said is true: there is a great deal of psychology in this; and I believe the drafting of Clause 3 is unfortunate from a psychological point of view. I believe that those responsible for the administration world, in similar circumstances, probably draft this clause differently.

As the noble Viscount the Leader of the Opposition said, there is an article inThe Times to-day which shows that Ghana is puzzled and apparently distressed at the outcome of the drafting of the present Bill. They say that the provisions of Clause 3 came as a surprise to them. Accepting what the Government say, and stressing what my noble friend Lord Swinton said as to the urgency of the review, would ask the Government whether they could come a little further towards those who feel as I do and wish to support them, because I sincerely hope that the noble Lord who moved this Amendment will feel able not to call a Division in the House. If he does, I think the Government will obtain a substantial majority, and little will have been achieved. The psychological point mentioned by the noble Viscount, the Leader of the Opposition, comes into play here. We want to send this Bill off with the best start. There has been a most useful and wide discussion. The Government have said that they would like to do what the majority of the House wish to do, but that they are unable to do so from a legal point of view. Could the Government give any sort of indication of how long they think this review will take? Will it be a matter of days, weeks or months? If we could get some general indication it would help us, because until this review has taken place, the Government policy must continue, and the position is open and unsatisfactory to many of us, even though we accept it this afternoon.

The second point I would ask Her Majesty's Government to consider is this. They have indicated that they wish to do as the majority of the House have expressed a view: they wish to give help to these emergent territories. They wish to forge a new instrument which will enable that to be done. For that purpose, the review is to be held. Would the Government consider penning an official Dispatch from Her Majesty's Government to the Prime Minister-designate of Ghana so that, at the time of the inauguration of the celebrations of complete independence, the Ghana Government will have an official Dispatch from Her Majesty's Government expressing the general wish and intentions which we understand from the debate to-day are in the mind of the Government? If those two things could happen, we might go some way to overcoming the psychological prejudice about which the Leader of the Opposition spoke. I hope that the Government will say that they will consider those matters, and I will give them my support.

3.54 p.m.


As I have taken part in this debate at its various stages. I feel that I should not be doing right unless I said to-day what I feel after hearing the reasons given by the noble and learned Viscount, the Lord Chancellor. I need hardly say that I share the bitter disappointment which many of us feel that the Government have felt it necessary to adopt this attitude. I should not have the impertinence for a moment to do other than accept completely what has been said by the Lord Chancellor. Let us agree that he completely demolished the suggestion made by the noble Earl. Lord Swinton. But that was only, to my mind, a side issue in this debate, and I am still left with my difficulty, which was that I cannot possibly see the need for Clause 3 in this Bill at all. That has nothing to do with the suggestion made by the noble Earl. Lord Swinton.

To my mind, this clause deals with a matter which is quite extraneous to the purpose of the Bill, and it is expressed with singular infelicity. That point has already been stressed. I speak as a mere administrator, who does not pretend to know anything about the law, but I do know how often what an administrator calls "common sense" is, from the point of view of dealing with humanity, preferable to the law, however logical and correct the law may be. The Lord Chancellor said, if I quote him correctly, that it would be wrong for Treasury control to cut across independence. I confess it may be my own lack of sense, but I cannot really see how apposite that can be. If a big business, operating, shall we say, in West Africa—one of those big businesses which do operate there—were to decide, on a project put up to it, that they did not feel justified in going into partnership with the Government, or whatever it might be, and therefore that they would not proceed with the project, surely that would not be cutting across the independence of the country. They are dealing with their own funds, and they are dealing with a decision as to whether or not they will use them in that particular way.

I have been a member of the Board of the Colonial Development Corporation, and I know how they work. I know that in questions of any doubt the wishes of the Secretary of State have always to be considered—and quite rightly so—and that suggestions may be made by the Secretary of State as to whether or not a project is a good one. The Board can always say, without anybody rightly objecting, that they cannot agree to provide funds for a certain purpose. All these facts seem to me to show that those are questions which have nothing whatever to do with this Bill, and I am left still a completely unregenerate opponent of Clause 3. I do not wish in any way—I should be the last person to wish to do so—to delay the passage of this Bill. But what is stopping it? Supposing there is strong opposition to this clause, and supposing there is a reasonable conviction on the part of the majority of this House that the clause is extraneous to the purposes of the Bill, what would be delaying the passage of the Bill? Nothing but the determination of the Government not to accept that view. That is what would be the cause of the delay. It would not be the people, like myself, who are expressing their own sincere and honest conviction that this is a lamentable clause.

I suggest that all that the noble Earl, Lord Swinton, urged the Government to hurry on with doing would meet with full support from me and from others who think as I do. That again has nothing to do, if I may respectfully say so, with what we are discussing. That urgency can be used even if we delete Clause 3. There would be all the more reason for it, but the two things are not tied up together. The retention of Clause 3 is a positive hindrance to the urgency of such a consideration, and will prejudice the position which, to my mind, need never have been prejudiced and, I would sincerely hope, still will not be prejudiced. Therefore, I remain an unregenerate opponent of Clause 3.

3.59 p.m.


May I venture to say a word in support of the speech just made by the noble Lord, Lord Milverton? Being entirely uninstructed in the law, I, of course, accept the legal opinion that has been given to us. I may he failing through lack of intelligence, but I fail to understand how the legal situation makes it necessary to have in the Bill subsection (4) of Clause 3. I do not like Clause 3 as a whole, but I particularly dislike subsection (4). I should be extremely grateful if the noble and learned Viscount the Lord Chancellor, or any other noble Lord who may be speaking for the Government later, would say whether the dropping of subsection (4) of Clause 3 would create any kind of legal difficulty.


I think the upshot of what the noble and learned Viscount the Lore. Chancellor said this afternoon was very much what was said last week: that is to say that, if Clause 3 is not included in this Bill, the Colonial Development Corporation can, if it and the Ghana Government so desire, operate in Ghana. That is what the speech of the Lord Chancellor amounted to, so far as I understood it; and on both sides we were already agreed upon that.

The new point the Lord Chancellor has introduced is this answer to the suggestion made by the noble Earl, Lord Swinton. That is the new ground, as I understand it, to-day. Of course we on this side were prepared to compromise on the suggestion of the noble Earl, Lord Swinton, but, if no compromise is possible, then of course we return to our original ground and we press our point on that ground. I was not quite clear—I say this for future record—why India was brought into this, because, so far as I am aware, India never was a Colony; it never came under the Colonial Development and Welfare Acts or under the Overseas Resources Development Acts. I may be a little confused, because the Lord Chancellor had his back to me when he spoke of India, but, so far as I am aware, India has no relation whatsoever to this matter, and never has had.


To be quite frank with the noble Lord—I am sorry that he did not hear—I said I was quite sure about Ceylon. I think he will agree about that. I explained that, but I told my noble friend that I had not actually checked the position of India before independence with the wording of the Act.


I am glad that we have cleared up the point about India, because that may be a little confusing; and often eminent jurists such as the Lord Chancellor are quoted. This is a very difficult matter, as he has indicated, and we do not want any misunderstanding to come in. Of course, naturally we accept what he says on the legal position. We should not think of doing otherwise. So we come back now to where we were before the noble Earl, Lord Swinton, spoke last Thursday. Perhaps we can go on from there and realise that no compromise is possible.

The article in The Times, to which my noble Leader, Lord Alexander of Hillsborough, has referred, indicates two things. The first is, as I have often mentioned to your Lordships in this House, that colonial affairs debates in this House receive wide publicity in colonial territories and are widely quoted. The House has, of course, justifiably and justly, a very high reputation in colonial affairs. The fact that we do not see colonial affairs reported at great length in the English papers does not mean that they are not quoted at great length in colonial papers; and often they are. I have no doubt that, as The Times to-day says, in Ghana great interest is being taken in our speeches here on Second Reading and on Committee stage, and that they are looking forward with anticipation to our debate to-day. They are also looking forward, no doubt, to the fact that in our debate to-day we shall grant them what they want: that is to say, that this clause shall be deleted from the Bill. Ghana reactions are, as I have been told, quite apart from this article in The Times, very unfavourable to the retention of this clause.

I should like to ask whoever is going to reply, either the Secretary of State or the Minister of State, a few questions. First of all, was this subsection (4) of Clause 3 in the Bill when the Ghana Ministers saw the draft of this Bill? Were they consulted about this subsection before the Bill was printed in this country? What are their feelings upon it? My information is that they never saw this clause at all; that the draft Bill as presented to them did not include this clause, the whole clause—and certainly not subsection (4); that they were not consulted about it, and that the first the Ghana Ministers knew of it was when they saw the Bill as printed in this country. Have the Ghana Government made any representations to Her Majesty's Government, either by Despatch or otherwise, with reference to Clause 3 (4)? Those are very important matters upon which, in my view, the Committee should have accurate information before it comes to the vote, if a vote is taken; and unless we get satisfactory assurances, we shall certainly desire to take a vote.

Another point upon which I should like information from the Government (I have put this question to them twice already, but I have not yet had an answer) is the question of providing fresh capital for existing enterprises. Will it be possible, under the provisions of subsection (4), for fresh capital to be obtained from the Colonial Development Corporation for enterprises which are already authorised, whether started or not?


May I interrupt the noble Lord for a moment? I have verified the point. I apologise to the noble Lord, Lord Rennell. I should have remembered it. "Colonial", in the Interpretation Act, is defined as expressly excluding India. So the noble Lord is right. I am very sorry that I did not remember it at the time.


I am much obliged to the Lord Chancellor. I think it is important to clear up that point.


I entirely agree.


I thank the noble and learned Viscount.

I have been heartened by the speeches of the noble Lords, Lord Milverton and Lord Hemingford. I think they are both right. What they say, in effect, and what the noble Lord, Lord Salter, has already said, is: "Why not leave this matter to the Colonial Development Corporation?" The Board of the Corporation are sensible people. They have now had years of experience. They are doing well. They are making money. They are not by any means a "soft touch", as it is called. They are business men, pretty difficult to deal with, quite frankly; but, still, they are looking after money and so on, and they have the right to take what precautions they think fit. Why not leave it to them? What is the objection to leaving it to the Colonial Development Corporation? They well know the views expressed in this House both by the Government, by Back Benchers on the other side, and by eminent noble Lords on the other side, and also by noble Lords on these Benches. So why not leave it to them? We are always told these days that more opportunity should be given to initiative, to freedom of choice; that people should be allowed to employ as they think fit the talents which the Almighty has given them and the resources available to them from other sources. Why not do so here? What is the objection? Why do we not trust the Corporation and allow them to carry on the job which has been given to them by successive Governments?

There is one point about which I must warn your Lordships, and it is very serious: it is the one touched upon by the noble Lord, Lord Salter. Supposing these emergent territories, particularly Ghana, Malaya and Nigeria, walk out of the sterling area, as they are quite entitled to do, what is going to happen then? How are we going to maintain our standards of living if they do not support us? As your Lordships know perfectly well, we could never have maintained anything like our present standard of living without the assistance of Malaya, the Gold Coast and Nigeria. For a considerable time, from rubber alone, quite apart from tin, Malaya earned more foreign currency than the whole British export trade. What is going to happen if they walk out? I am happy to say that up to now there is no likelihood of that. They are quite content to stay in. They realise the advantages and they want to retain the bonds of friendship and ties of affection they have with us. But this sort of thing is not going to encourage them to do what we want them to do: to remain in the sterling area.

I have taken the advice offered, and I have not commented upon the other subsections of this clause. But if the Government does not withdraw this subsection we will go on to debate those at a later stage this afternoon. I will read to your Lordships the language in those subsections—the harsh and unconscionable way in which these countries are going to be treated. I think you will agree that, from our point of view, it is very dangerous language to use, as the noble Earl, Lord Attlee, said last week when he referred to the language in which this clause is expressed. My Lords, I regret to say it, but I must say it: I believe that the Government are killing the Colonial Development Corporation, not only by this means —because the various emergent territories will be treated the same way as Ghana—but also by now saying that the Colonial Development Corporation cannot finance projects in colonial territories if the territories can get their finance from any other source. This is the death knell of the Corporation.


I do not think the noble Lord should say that without its being met straight away. We are not saying that. We are saying that we shall look at the whole question with a perfectly open mind and review the whole matter of the channelling of investment to independent Commonwealth countries, including emergent Commonwealth countries.


I am very confused about this matter, because I said this on Second Reading and it was never denied by the noble Lord.


What the noble Lord, Lord Ogmore, said just now was that the Government were trying to kill the Colonial Development Corporation's power to give money to colonial territories. This is not a colonial territory. There has never been anything said by the Government about restriction in regard to colonial territories.


The n able Marquess is not aware of what happens in the Government of which he is a mem- ber. I said the Government were killing the Corporation in two ways: first, so far as emergent territories were concerned, by this clause; and secondly, by the fact that they told the Corporation—and if they have not told them I shall be very glad to hear -it and I stand to be corrected, but I did make this statement on Second Reading and it was not corrected—that they are not to give finance for projects in colonial territories if the colonial territories can get their finance elsewhere. If I am wrong, I shall be glad to withdraw; and I shall be very glad to hear I am wrong. My Lords, we shall press this matter to a Division.


My Lords, might I refer to the Colonial Development Report, 1955, which says that the C.D.C. stands by to help essential capital development for which finance is not otherwise available?


Yes, but that does not exhaust their whole field. If they stand by where finance is not otherwise available they must stand by where finance is available. If they are going to undertake only the sort of project for which no me can get finance, they will never make a profit and they cannot continue to operate. Under the Overseas Resources Development Act they have a statutory duty to make both ends meet year by year, which means they must have some good bargains to carry the bad bargains.

4.15 p.m.


My Lords, I find it a little difficult to wind up this afternoon, because we have had long debates on Second Reading, in the Committee last week and again to-day. Before I deal with the various points raised by noble Lords I should like to try to answer the questions put specifically by the noble Lord, Lord Ogmore. He first of all asked whether this particular clause was in the Bill when it was shown in the first instance to the Government of Ghana. The answer is that when the Bill went out first it was not in it, and the reason is because the Bill at that time was dealing with policy and policy was under discussion. The text of the clause was telegraphed out before the Bill was published.

The next question the noble Lord asked was whether there has been any reaction from the Government in the Gold Coast to the whole question of the rôle of the C.D.C. To that I would say that there has been to-day a memorandum on the question generally of how we can help Ghana once it is independent. I have not had time really to study this, but it is full of considerations of the sort which are most important and necessary for us when we make the review which has been promised. The last question he asked was whether there can be fresh capital introduced on existing projects, and the answer to that is that it is certainly not ruled out if a project so demands it.

My Lords, I greatly hope that we are not going to divide to-day. I recognise the great disappointment there has been to many noble Lords by the legal opinion that has been given. But I think that the various arguments advanced that the clause should be dropped did not give sufficient force to the legal opinion, which was that, on the basis of the alternative which was suggested by the noble Earl, Lord Swinton, and which the Opposition said they would be prepared to accept, we have been told that it is not possible and that Clause 3 is necessary. I. for one, should certainly not wish to differ from the weight of opinion we have had.


Might I ask the noble Earl a question? I fully accept and understand, I think, the legal objections; but those legal objections surely are applicable only to the compromise suggested by the noble Earl, Lord Swinton, supported by one or two other noble Lords and accepted by the noble Viscount, Lord Alexander of Hillsborough. These legal objections surely do not hold for those of us who wish to have the clause omitted completely in order that the C.D.C. should continue to act. I am not at all taken with the compromise; I do not like it at all; I think it is a horrid, roundabout way of doing something which the clause does, and I am sure the noble Viscount the Lord Chancellor is right when he says it is of dubious legality and that the clause is the right way. But it is doing what I do not want to do and what other noble Lords do not want to do. We do not want the compromise because basically it intends to do, in another way, what we dislike.


I understand the noble Lord's point, and I think that if we took the whole thing out the legal problem would not arise. But we all agreed the other day that we would try for the compromise and find to-day, unhappily, as we have told your Lordships, that it would not work. What we feel very much is that we should not decide this issue of what is the best machinery, and so forth, for Commonwealth development by a side door. We do not rule out the use of any machinery, but we feel that it should be considered objectively and not just happen by chance through one piece of machinery slipping through and others not being considered.

Before I touch a little further on the question of the review, I think it is useful to recall what your Lordships have gained. They have focused attention on the economic development of the Commonwealth and emergent nations and given the review a real sense of urgency. The question of whether lending by the Government, as opposed to lending by the capital markets of the world, is the more appropriate will receive the most careful weighing up, as will that of what is the best machinery for this purpose. In connection with that, we have had the most helpful comments on machinery from Lord Swinton, Lord Balfour of Inchrye and others. As we have, on the whole, in the Commonwealth a shortage of capital for investment—Commonwealth countries are all, with the exception of ourselves, capital importing countries—I think that the way we can best help the emergent nations at the present time is through services and kindred facilities.

It may be useful here, perhaps, to take a look at some of these, for so often the cry from the Commonwealth and the emergent nations is for expertise and technical assistance. Naturally, when that arises, there comes to my mind the services of the Colonial Office itself, its great general experience, its network of professional advisory bodies, and its specialised knowledge arising from all that is involved in analysing and finding finance for Colonial Development plans. Other Government Departments also greatly help, such as the Ministries of Health or Agriculture. Then there are semi-public bodies, such as the Inter-University Council and Medical Research Council, or, in a rather different category, the Trades Union Congress and the Federation of British Industries. And lastly there is private enterprise, with its huge range of industrial, commercial and scientific experts. Here is a field where Commonwealth countries too can assist, for they often have specialised knowledge of problems which affect their own countries. Throughout the world the cry is for technicians, and bodies such as U.N.O. and its various Specialised Agencies or the World Bank call on us to contribute personnel. While this is right and proper, it may also be that the Commonwealth itself can, and should, do more to organise assistance for its own members. Having said so much, I must say one word of warning: we do not want machinery for machinery's sake; and on the whole the existing system works pretty well. None the less, the subject merits review and we have promised that we will give it this review.

In that review, alongside all the other possible machineries that I have outlined, there will, of course, be considered what part, if any, should be played by the Colonial Development Corporation. The last thing that we should want is for Ghana or for other new nations which are shortly to come to independence to think that, having seen their ship of State triumphantly launched, we are no longer interested in the way it sails; and to the extent that Clause 3 may give that appearance, we much regret it. In fact, the exact opposite is the case, and, as other noble Lords have said, when the people in Ghana read of this debate they will see how often we from this side, as well as other noble Lords, have reiterated our intention to help. Indeed, we are most anxious that the voyage should be a continuing success and, in so far as we can, to provide a fair wind, if Ghana cares to seek our advice and guidance on any economic or other matter we will do all that we can to help. We want Ghana to know that our hope is to remain her partner through bad times and good, and that our sincerest wish is that her times should be good.

4.25 p.m.


We have had a very long discussion, both to-day and on a previous occasion, and we on this side of the House are grateful for the great trouble that the Government have taken to reply to our arguments. But perhaps it would be as well, at the end of this long discussion, if I were to venture to remind the Committee of the terms of the Amendment which we have submitted. It is to omit subsection (4) of Clause 3 of the Bill. I should like, with your Lordships' permission, to read subsection (4), because it shows the limited objective that we have in mind at this moment. Subsection (4) reads as follows: Without prejudice to the continuance of any operations commenced by the Colonial Development Corporation in any part of Ghana before the appointed day, as from that day the expression 'colonial territories' in the Overseas Resources Development Acts, 1948 to 1956, shall not include Ghana or any part thereof. What we are asking the House to do is not to exclude Ghana from any future scheme which the Colonial Development Corporation may wish, with the agreement of those concerned in Ghana, to start in that country.

I think that all your Lordships, whether upon this side of the Committee or the other, have accepted the legal arguments advanced with such cogency by the noble and learned Viscount the Lord Chancellor. It is perfectly clear that the objective which we have in mind cannot he obtained by means of an instruction given by the Secretary of State to the Colonial Development Corporation, which was the original suggestion made by the noble Earl, Lord Swinton. I think we must all accept that that suggestion is of no value from the point of view of this purpose. But there are other ways of achieving the same purpose. They have been mentioned by the noble Lord, Lord Milverton, who was himself for many years a member of the Board of the Colonial Development Corporation, and also by the noble Lord, Lord Salter.

The noble Lord, Lord Milverton, said that the Corporation respects the wishes of the Secretary of State, and surely a "gentlemen's agreement" between the Corporation and the Secretary of State would be quite sufficient—a "gentlemen's agreement" that the Corporation would not go into Ghana until the inquiry which the Government have promised had taken place and until the results were known. We are anxious that the inquiry should go forward, and that its conclusions should be reached and made available at the earliest possible moment. Of course, the results of the inquiry may be either that the Colonial Development Corporation should be used in independent territories, or that capital will be available from other sources. But if the first decision is reached, then what your Lordships will be doing by passing this clause in the Bill, will be to make it necessary for the Government to pass amending legislation before the Colonial Development Corporation can go into Ghana. All we want to do is to keep the door open, not to prejudice what happens eventually.

We are not suggesting that the results of this inquiry into Commonwealth development should be prejudiced by saying that the Colonial Development Corporation must go in. Far from that, all we want is the door left open, so that the Colonial Development Corporation may go in without amending legislation which would have to be accepted by Parliament here if the inquiry resulted in a recommendation in that sense. Under the other method suggested by the noble Lord, Lord Salter, who, after all, has immense administrative experience, Her Majesty's Government have control over the sanction of loans; and that is an administrative method that might be used. But I cannot help feeling that the method

of the gentlemen's agreement, suggested by the noble Lord, Lord Milverton, is one that would be more satisfactory in the circumstances.

All we are asking Her Majesty's Government to do in this Amendment is to leave the door open, so that until this general inquiry has produced recommendations which will enable these emergent territories to raise the capital they want, either through the Colonial Development Corporation or in other ways, the position should not be prejudiced by prohibiting by law, by statute, the entry of /the Colonial Development Corporation into this territory. A precedent of this kind would, of course, have to be followed in the case of Malaya, which will become independent in August of next year, and in the case of the West Indies and other areas at present dependent which, in the very near future, will become self-governing members of the Commonwealth. So I very much hope that on the merits of this Amendment alone (we shall deal with the clause later on) Her Majesty's Government will accept the views which have been expressed on both sides of the House.

Their Lordships divided: Contents, 31; Not-Contents, 69.

Albemarle, E. Archibald, L. Macdonald of Gwaenysgor, L.
Attlee, E. Ashton of Hyde, L. Mathers, L.
Bessborough, E. Crook, L. Milverton, L.
Buckinghamshire, E. Douglas of Kirtleside, L. Moyne, L.
Cork and Orrery, E. Faringdon, L. Ogmore, L.
Listowel, E. Geddes, L. Raglan, L.
Lucan, E. [Teller.] Greenhill, L. Reith, L.
Haden-Guest, L. Silkin, L.
Alexander of Hillsborough, V. Hemingford, L. Strabolgi. L. [Teller.]
Hall, V. Lawson, L. Winster, L.
Lucas of Chilworth, L. Wise, L.
Kilmuir, V. (L. Chancellor.) Perth, E. Aberdare, L.
St. Aldwyn, E. Ailwyn, L.
Salisbury, M. (L. President.) Selkirk, E. Amulree, L.
Swinton, E. Balfour of Inchrye, L.
Exeter, M. Woolton, E. Cawley, L.
Reading, M. Chesham, L.
Willingdon, M. Colville of Culross, V. Clitheroe, L.
Falmouth, V. Coleraine, L.
Alexander of Tunis, E. Furness, V. Congleton, L.
Fortescue, E. [Teller.] Goschen, V. Croft, L.
Gosford, E. Hailsham, V. Dinevor, L.
Home, E. Runciman of Doxford, V. Dormer, L.
Lindsey and Abingdon, E. Soulbury, V. Ebbisham, L.
Morley, E. Stonehaven, V. Ellenborough, L.
Onslow, E. [Teller.] Thurso, V. Fairfax of Cameron, L.
Gifford, L. Howard of Glossop, L. Newall, L.
Glentanar, L. Hylton, L. Remnant, L.
Glyn, L. Jessel, L. Rockley, L.
Grantchester, L. Leconfield, L. Strathclyde, L.
Grenfell, L. Lloyd, L. Strathcona and Mount Royal, L.
Gretton, L. Mancroft, L.
Gridley, L. Merrivale, L. Stratheden and Campbell, L.
Hampton, L. Merthyr, L. Teviot, L.
Harris, L. Meston, L. Waleran, L.
Hore-Belisha, L. Moynihan, L.

Resolved in the negative, and Amendment disagreed to accordingly.

House resumed.