HL Deb 20 July 1959 vol 218 cc225-86

6.7 p.m.

EARL JELLICOE rose to call attention to the need, which was emphasised by the recent Atlantic Congress, for a definite, long-term and consistent policy towards those countries which lie outside the Atlantic Community and also outside the Communist bloc aimed at en-

I am not really sure that people would want that to be done when the time comes. If the Chancellor of the Exchequer has a surplus on any account we do not want it to be earmarked for new towns or something else on a sort of special pleading; we want it for whatever may be the great thing that the Chancellor has in mind to use surpluses for. It may be for increasing pensions or reducing taxation. I do not think that the principle behind this Amendment is acceptable. No really new argument has been adduced other than that the Amendment has been slightly widened to incorporate local authorities as well as new towns. I must ask your Lordships not to accept this Amendment.

On Question, Whether the said Amendment shall be agreed to?

Their Lordships divided: Contents, 13; Not-Contents, 47.

CONTENTS
Alexander of Hillsborough, V. Lawson, L. Shepherd, L. [Teller.]
Amwell, L. Lucan, E. [Teller.] Silkin, L.
Crook, L. Macpherson of Drumochter, L. Stansgate, V.
Henderson, L. Ogmore, L. Strabolgi, L.
Latham, L.
NOT-CONTENTS
Aberdare, L. Ebbisham, L. McCorquodale of Newton, L.
Aldington, L. Ebury, L. Margesson, V.
Ailwyn, L. Fortescue, E. Monk Bretton, L.
Airedale, L. Fraser of North Cape, L. Newall, L.
Auckland, L. Furness, V. Onslow, E. [Teller.]
Bathurst, E. Goschen, V. Reading, M.
Bessborough, E. Gosford, E. Robins, L.
Birdwood, L. Grantchester, L. St. Aldwyn, E. [Teller]
Buckinghamshire, E. Hailsham, V. (L. President.) Sinha, L.
Chesham, L. Hampton, L. Soulbury, V.
Cholmondeley, M. Hawke, L. Strang, L.
Clitheroe, L. Home, E. Strathspey, L.
Conesford, L. Jellicoe, E. Tweedsmuir, L.
Crathorne, L. Kilmuir, V. (L. Chancellor.) Waldegrave, E.
Digby, L. Lansdowne, M. Waleran, L.
Dundee, E. Limerick, E.

Resolved in the negative, and Amendment Disagreed to accordingly.

suring that their political independence is firmly based on a sound economic foundation; and to move for Papers. The noble Earl said: My Lords, I beg leave to move the Motion standing in my name. Last month a rather remarkable Congress took place in London. It was remarkable in that it brought together some 650 eminent citizens from the countries of the Atlantic Alliance. Perhaps I should correct the figure: 649 were eminent, and there was myself. But for me, my Lords, the Congress was chiefly remarkable in that there was an almost unanimous recognition of the fact that perhaps the major task confronting our countries in the future is that of trying to reach a solid relationship with those countries which lie both outside our Atlantic Community and also outside the Soviet bloc; or, to be more precise, should I say the Sino-Soviet bloc?

Which are these countries? They are very varied, yet they have certain marked common characteristics. This great arena of countries, peopled by more than 1,000 million people, lies mostly to the South, in Latin America, in Africa and the Middle East, and in Asia. Very few of their peoples are of European stock. Most of them have a different pigmentation from your Lordships. Almost all live in countries which for 300 years or so have been in one way or another dependent upon Western Europe. All share a passionate belief in political independence, whether they have recently acquired it or still seek to acquire it. Many feel an equally passionate desire to stand aside from the great contest which wracks our Northern societies, the contest between the concept of the free society and the concept of Communism. Finally, my Lords, all these countries are poor and all are under-developed.

This, I feel, is a problem of increasing urgency. In this revolutionary age change of all sorts steals on us much more quickly than we expect. Who of us would have expected ten years ago, for example, that we and other Colonial Powers should find ourselves in such difficulties in Central and Southern Africa to-day? In economic terms the problem is urgent, since at the present time we are faced with two simultaneous revolutions in the world: the revolution of rising expectations of the poorer populations and the revolution of their exploding population. So it is that, as these countries gain one rung on the ladder of economic progress, they are pulled down two rungs by the drag of population. It is still a fact, as my noble friend Lord Strang reminded us vividly some months ago, that the average annual income of an Egyptian is less than the price of a television set. What is more important, these populations are becoming conscious of their poverty. It will not be possible, therefore, my Lords, for this world to continue, half rich and half poor, without a series of the most violent convulsions.

The other reason, of course, why this problem is so urgent is that the Communists see in this other third of the world the key to world domination. The bear of Red Russia and the dragon of Red China are waiting impatiently in the wings. We must recognise, too, that the Communists have powerful advantages. They work from interior lines; they work to a long-term strategy; they work with a total tactical unscrupulousness. And, above all, they work with unity of purpose. They have cleverly managed to dodge the stigma of colonialism. Finally, Red Russia has shown, and Red China is showing, how an undeveloped country can, by its own exertions, by the boot-strap technique, albeit at a fearful cost in human freedom, pull itself up to a place in the economic sun. I think that, for Asian and African peoples, our industrial revolutions are rather vieux jeu; but the industrialisation of Red China and of the Soviet Union are taking place before their eyes and, indeed, almost on their doorsteps in certain cases. For hungry people, for thirsty people, these great programmes which they see going on in front of them are an intoxicating draught.

The Soviet challenge is, I feel, a compelling motive for decisive Western action. It sharpens our dilemma and increases the penalties of failure. But it is a negative motive, and the Atlantic Congress felt that there were other, and stronger, positive motives for action. In part these are moral. As we in the West have come to believe that slum conditions in our own societies cannot be tolerated, how can we sit idly by while the rich countries become richer and the poor, if anything, poorer? We must remember that in this contracting world the slums of Baghdad, of Johannesburg, of Karachi and of Calcutta are as close to us to-day as the slums of Liverpool and Manchester were a century ago. There is also the powerful and compelling motive of economic self-interest for us to help these countries to help themselves. It is the great trading nations of the West who stand to gain most by the conquest of world poverty and the extension of world prosperity.

The Congress considered that three principles should underlie our Westerns policies in this field. The first was the recognition of the primacy of politics—and, indeed, psychology—over economics. If the West does not get its politics and its psychology right with these people, it will not get its economics right with them. Our relations with these new and emerging countries must therefore be grounded on a basis of partnership—real partnership. The second principle was the recognition that for poor and under-developed countries political independence is a fiction unless it is buttressed by real economic independence. But to attain this economic independence, which must be mainly won by self-help, massive and sustained assistance from the West will be required. The third principle was that the policies in this field must receive high and continuing priority from our Western Governments—as high a priority, indeed, as we accord to defence or to the Welfare State. This means that we in the West cannot rely, as I feel we have relied in part hitherto, on ad hoc, piecemeal, inconsistent, and unconcerted policies.

In the political field, the application of these principles will involve quick, and sometimes painful, adjustments of policy. They mean that we must "go with the grain of nationalism." In certain areas—in the plural societies of Africa, for example—it means that we must move faster than we or the European communities there may wish to go. In the words which Sir William Hayter used in an admirable paper submitted to the Congress: The Western Governments ought to examine quite coldly, in the context of the main world struggle between the West and the Communists, how much positive advantage to their own countries and to the West as a whole continues to reside in each particular case where nationalist forces are still being opposed. Since our aim is to give aid as between equals, it will defeat our purposes if we attach political or military strings to that aid. We shall defeat them too, I feel, if we seek to tie our aid to the adoption by these new countries of our practice of democracy. Their external freedom is our concern, but their internal freedom is their concern. The criterion which we should apply is rather the efficiency of their administrations; their ability effectively to absorb the aid which is given to them. This presupposes a degree of administrative efficiency; it also presupposes a degree of popular support. But it does not presuppose that Mr. Nkrumah or General Ayub Khan or Mr. Nehru should model themselves on Mr. Edmund Burke or Mr. Stanley Baldwin.

In the economic sphere, our effort, as the Congress saw it, should be deployed in three main fields. The first field is money. Massive injections of foreign capital are required to enable the underdeveloped countries to make the so-called "break-through" (I think that is the term the economists use, though I am not one myself), so that their economies can become truly self-sustaining. The experts suggest that the under-developed countries need to invest a sum equivalent to some 12 per cent. of their national income each year in order to render their economics really self-propelling. They also agree—and it is a remarkable thing, given the fact that they are experts, that they do agree—that in order to do this these countries will need approximately double the amount of external assistance they are receiving at the present time. They will need, in fact, something of the order of £15,000 million extra over the next decade—something of the order of £1,500 million each year. This is a very tall order indeed. But, my Lords, it is not all that tall: it is about one-tenth of what the United States is spending this year on defence.

How is this money to be found? Partly through private investment, and partly through bilateral aid from Government to Government. In addition, the Congress believed that everything possible should be done to reinforce the international agencies of aid—the U.N. agencies, and agencies of the U.N. like the Special Fund, the I.M.F., and the World Bank. Agencies like the World Bank—and the World Bank is perhaps a particularly good example—have great experience and great expertise. They have gained the confidence of the recipient countries. Very often these countries will accept from them advice and conditions which they would not tolerate from a national Government.

In this respect, I should like to ask the noble Marquess who will be replying two questions. The first concerns the newly established United Nations Special Fund. As I understand it, the purpose of this Fund is to act as a spark for development. It is in the safe hands of Mr. Paul Hoffman, of Marshall Plan fame. He came to this country hoping to persuade Her Majesty's Government to raise their present contribution to this newly established Fund, this fledgling, from the present modest figure of about one million dollars. He failed. Could my noble friend perhaps let us know a little more about this?

My second question relates to the proposal for an International Development Association, a proposal which the Congress officially backed. On the whole, the delegates were against the creation of new agencies—goodness knows! we have enough of them already—but they did make an exception in favour of this particular one; and I think they are right. It is a good egg and there seems to be a good chance of hatching it out fairly soon. It would be designed, as I understand it, to meet a very real need; the provision of development loans to underdeveloped countries which cannot be financed on hard currency repayment terms. The International Bank makes "bankable" loans to the under-developed countries. This agency would provide for what is also needed, and what indeed all of us like—"soft" loans. I myself see an advantage in such loans being made available by an international agency, perhaps under the wing of the World Bank. Most important of all, this proposed new "soft" loan agency is a real starter, since it has received strong off-the-course backing from the Americans. I hope that Her Majesty's Government will do all they can to ensure that this egg is conceived in as big a way as possible and that it is hatched out as soon as possible.

I noticed that Sir Oliver Franks has suggested that the initial capital of this proposed Association should be in the region of £1,000 million and that our share of it might be between £100 and £150 million. I hope that Her Majesty's Government are thinking as big as the bankers. There is little point in putting a little money on a lame horse. Money on a great scale is certainly needed. However, the magic wand of capital by itself cannot do the trick. It is equally important that the money should be wisely spent. This is no easy matter, since the rapid development of an under- developed country raises actute social and economic problems, as well as purely economic ones. One of the greatest of these problems is that such development, unless wisely directed, can increase the gap between the relatively well-to-do urban populations and the impoverished rural masses. I well remember in Baghdad the unspeakable misery in which the hundred thousand or so peasants, who had been sucked in from the country by the lure of the jobs created by industrial development, were living.

It is true that large-scale schemes of development are needed, but equally badly needed are small-scale schemes, in particular those connected with agriculture—the provision of rural houses, local irrigation and the improvement of small-scale agricultural techniques. Here I am sure our Western countries could do far more to help the undeveloped countries than they have done hitherto—and perhaps make the Communists look a little foolish into the bargain. For although the Communists have certainly evolved a highly successful technique of industrialisation, one fact sticks out like a sore thumb in their world—their failure over agriculture. Men are, in fact—and I should like to insist on this, as the Congress insisted on it—just as important as money.

Some of these men—technicians, economists and administrators—have to come from outside. We have to provide them. And here I believe that we can do a great deal better. I do not suggest that we should flood the underdeveloped countries with a horde of Western technicians. It is not the quantity that counts; it is the quality. I feel, too, that here the West may perhaps be able with profit to take a page from the Russians' book. Their technicians are carefully selected. They are well-versed in the customs of the countries to which they go; and, above all, they speak the language. I do not suggest that we can, or should, ape their methods, but I do suggest that we can, and should, improve our arrangements on the national level for supplying technicians and administrators, and above all that we can make a far better division of effort and far better co-ordination of resources between the Western countries. Perhaps we should seek to establish, as was suggested by Sir Leslie Rowan in his Paper to the Congress, an international technical and economic service, possibly under the I.M.F. and the World Bank, but staffed by a few men and women of the highest quality and qualifications.

But again, in the human sphere, it is on self-help that the under-developed countries must ultimately rely. It is their technicians, their economists, their administrators, who must run their development programmes. Yet the West can help these countries to help themselves Nowhere can we help more than in the field of education. We can help by finding more places for foreign students in our colleges and universities in the West. We can help by planning to enlarge our schools, universities and technical colleges in order to cope with this great need. We can help by doing far more than we are doing at present—for example, in Africa—to underpin the Administrations and the economies of the emerging countries with a really solid infrastructure in education. We can help, too, by encouraging and making it easier for our teachers and professors to take up appointments in the schools, colleges and universities of these developing countries.

The third field to which the Congress felt the West should direct its close attention is that of its trade relations with the developing countries. Since the accent is on self help, surely we must do all that we can to organise things so that those countries can make their way in the world by trade rather than by aid. And here we must be consistent. To my mind, it is totally inconsistent for us to adopt liberal aid policies towards developing countries if, at the same time, we pursue illiberal trade policies.

The programme which I have sketched out is undoubtedly a strenuous one. It demands from the West an effort of imagination, organisation and will equal to that which inspired the Marshall Plan. Then, faced with the devastation of Europe after the war—faced with an extraordinary situation—the United States took extraordinary measures to help Europe to help itself. Now, faced with the poverty of the other third of the world, we, in my submission, must take extraordinary measures to help the under-developed countries to help themselves.

I believe that in this strenuous task the United States, Britain and Europe should pull together. This time the lead must be shared: the impulse cannot come only from the United States, but must come also from Britain and Europe. There are many reasons why it should. Europe, with its political, historical and territorial extensions, and Europe, as the largest importer of raw materials in the world, has a vital stake in the prosperity and stability of these countries; and Europe is now rich. To take only one yardstick, in the last ten years the gross national product of the European N.A.T.O. countries has increased by 50 per cent., and in that same period the gross national product of the United States has increased by only 35 per cent. One glance at Paris, or Hamburg, or Vienna, or Milan, or, indeed, London, confirms this prosperity. In Europe, too, there are great untapped reserves of skills and resources which should be harnessed to this yoke. France, it is true, devotes more of her national income to this purpose than we or the Americans do. But it is idle to pretend that Western Europe could not do more. Possibly the French could; I strongly suspect that we could; and I am quite certain that Germany, the strongest economic unit in Europe, could.

I said just now that I thought the lead should come from Britain and Europe. I submit that it should come from Britain in Europe. There are many reasons why we, as the centre of the Commonwealth, should take the lead over this matter, but there is, I think, a particular reason at present. In the European context, the Six, the countries of the European Economic Community are now paying much attention to the development of the overseas territories linked with them. We are trying to organise the Seven. My hope would be that, if we succeed, we should immediately propose that both groups should jointly study this whole problem of aid to the under-developed countries with a view to seeing how the policies and plans of both groups should best be co-ordinated and developed. This is desirable in itself to ensure that Europe's energies and reserves on this front are fully and effectively deployed. But it might also be helpful as opening up to the Six and Seven a field for fruitful and positive collaboration—as strengthening that bridge between the two groups which we hope to build. I believe, too, that we already have in the O.E.E.C. the obvious instrument for co-ordinating our policies towards the under-developed countries—a good machine, and one which is lying rather idle at present. it is for these reasons that I should like to suggest that Her Majesty's Government should take the lead, in concert with our friends and neighbours in Western Europe, in initiating high level discussions, possibly within the O.E.E.C., with a view to putting to the Americans at any early date a considered, agreed and concerted European programme.

To conclude, my Lords, I believe that the crisis of our era is largely a crisis of leadership in the West. As a result, what do we so often see?—so often, in fact, that we now seem to assume that it is part of the natural order of things. What we see is the rather pathetic spectacle of the West dancing, a little out of step, to a Muscovite tune. But surely, my Lords, if ever a challenge cried out for leadership, it is this—one of the great challenges of our times—the task of helping half of the world to pull itself up in freedom out of poverty. Of one thing I am sure. I am sure that we in the rich West have the resources for this task. We have the men, and we have the money, too. But have we the will? I beg to move for Papers.

6.35 p.m.

LORD OGMORE

My Lords, we are all grateful—and this is no formal tribute—to the noble Earl, Lord Jellicoe, for putting down this Motion and also for the brilliant speech he has made, splendidly delivered and full of common sense. I hope that the conclusions of it will make the impressions they should do upon the noble Marquess who is to reply, upon the Government and upon a much wider field outside the United Kingdom Government to which, to some extent, his words were addressed. I think the noble Earl was quite right in putting down this Motion to-day, although it is perhaps, by our standards, a little late in the evening for a debate of this character to come on. We are going away for some three months at the end of next week, and it would have been odd and inappropriate, in my opinion, if we had gone away without a word being said about the Atlantic Congress which drew this large number of people to London and without a word being said in this House on the problem with which the noble Earl has dealt.

I should like to congratulate the Congress organisers on the Atlantic Congress, and I would pay tribute to the leader of the United Kingdom delegation, the noble Lord, Lord Crathorne, who has just joined our ranks. There has been, I understand, in uninformed quarters some criticism that the Congress was held. There are some, again uninformed, who feel that a good deal too much money was spent on it. Well, it was not Government money but private money, and, in my view, it was well worth every penny that was spent. It was necessary after ten years for representatives of the Atlantic Community to come together in London or elsewhere to examine what had happened in those ten years; to look at the problems which faced the Atlantic Community, and to give some thought to the future. Looking at it from a more parochial point of view, the delegates saw London, which was looking its best at that particular time, and they sampled our hospitality, which, as we all remember, was on a generous scale, both from the Government and from private benefactors. In fact, those of us who were hosts must, I think, pay tribute to the noble Baroness, Lady Elliot of Harwood, who was indefatigable in this field; indeed, any of us who for one moment sought a little refreshment to sustain us in our arduous duties of hospitality found her at our elbow looking reproachful and urging us on to fresh endeavours. As I say, she was indefatigable, and we owe her and all the ladies who helped her in this task a deep debt of gratitude.

I think it was important, too, that the various representatives, not only Parliamentarians but others, should have the opportunity of meeting many of the leaders of the various communities. The Congress had the honour of being opened by Her Majesty the Queen and the Duke, and afterwards they met, or had the opportunity of hearing, a large number of our distinguished figures, including the noble and learned Viscount on the Woolsack, the Prime Minister, Mr. Gaitskell, my noble friend Lord Attlee and others; and, of course, we in this country had the opportunity of hearing the distinguished leaders from other countries.

May I now turn to the Motion before the House? In the simplest and most dramatic terms it can be seen at the present day in the ideological conflict between India and China. India's dilemma is of a vast Parliamentary democracy on an hitherto unheard-of scale, with a population increasing every year by that of Greater London; with a national income of less than £25 per head of the population per annum; with a cattle population almost as great as the human, and much of it quite useless; and with an expectation of life steadily prolonged by medical science. Can this problem, which has never been faced before, so far as I am aware, in the history of the world, be faced and solved by the methods of Parliamentary democracy, or must India follow China's example and try to do it by totalitarian means? The same problem with which India is faced faces other countries both in the Commonwealth and outside, although, of course, not to the same extent.

As the noble Earl, Lord Jellicoe, has quite rightly said, the situation is not getting better but worse, in so far as the rich countries are getting richer and the poor countries poorer. We have, in a way, Disraeli's two worlds on an international, if no longer on a national, scale. Mr. Paul Hoffman, speaking in Geneva last week, addressing the United Nations Economic and Social Council, said that sixty of the eighty-two nations in the United Nations could be classed as less developed with a population of 1,000 million and with an average income of about £43 per head per annum, as compared with an average of £285 per head per annum in developed countries. The population is increasing in the under-developed countries by 2 per cent. whereas the increase in their income is increasing by only 3 per cent., or 6s. 8d. per annum. When you get down to brass tacks, that is in fact what is happening-there is an increase of 6s. 8d. per head per annum in the under-developed territories, which is not very much.

As the noble Earl has said, the Atlantic Congress was preoccupied with this problem probably more than any other. There is no doubt about it that there has been an enormous change in the climate of opinion in N.A.T.O. circles in the last two years. In the 1957 conference in Paris I made a speech drawing attention to the problems of Asia and Africa, and it made the same effect as a stone makes dropped in a pool of water—that is, none at all. Less than two years later we could see at this conference that the attention of the delegates from all over the Western world was concentrated upon it, so that it shows what an enormous change there has been in the climate of opinion in less than two years. Eight resolutions of the Congress referred to this problem and two of them, as the noble Earl has said, referred to the formation of new organisations. One was the World Development Corporation and the other an International Development Association. A third suggested that the implementation of policies in this field had better be carried out by N.A.T.O. members severally or through joint agencies less associated in the public mind with military policy than is N.A.T.O.

There was general agreement on the last resolution—in other words, that N.A.T.O. itself does not want to carry out these particular policies—but there was not, I think, general agreement on the other two resolutions; that is to say, on the formation of these new organisations. As the noble Earl has said, the United States Government and also the United States delegates at the conference favoured the creation of new organisations for this purpose. I think it is also true to say that, generally speaking, the United Kingdom delegates did not. This was made clear in speeches by delegates and also by speeches at the conference. I thought the Prime Minister made this clear, and certainly Mr. Hugh Gaitskell made it very clear in his speech, that we do not favour the setting up of new organisations for this purpose. He felt that there was no lack of organisations. What is needed is for the existing national and international organisations to have their resources increased, their scope widened and some of their present limitations removed. I note since the Congress was held that Mr. Kishi, the Prime Minister of Japan, has also advocated a new international bank or a fund for Asia, lending in and being repaid by soft currencies. This, as the noble Earl has said, was the United States policy at the New Delhi conference.

There you have a difference of opinion, not as to the ends in view but as to the means. I suppose it will have to be threshed out in Government circles of the West, in the N.A.T.O. Conference of Ministers and at the N.A.T.O. Parliamentary Conference which is to be held in November in Washington. Our experience in this field is of value, because we have probably had more experience in dealing with under-developed territories than almost any country in the world. I should have thought that the short supply of funds, hard and soft, of "know-how", of managerial experience—and that is terribly important in this field—of professional men and of technicians was the real problem. At the moment I have this problem personally on my desk, because a country in the colonial territories in which I am interested has asked me to find a technician or rather a professional man of a certain type for them, and I am finding it very difficult even to get one candidate. I am told by those who know best what the position is in this field that I shall be lucky if I get one candidate. So the setting up of organisations in themselves is not going to have much effect if the men and the resources are not there.

Although a few years ago materials were in short supply, I do not feel that that is still the case. It is not materials, but the question of men and money. We have a large number of agencies in the West. We have national agencies in our own country, which are very well tried; that is to say we have the various Government agencies, and we have private enterprise agencies, and then there are the international agencies. Is it going to be of much use to set up a new one which will inevitably be competing in this close and narrow field for the men and the money that we require?

Last week the Commonwealth officials met in London under the chairmanship of Sir Roger Makins, who also played an active part in the Congress, and they met to consider means of mobilising resources for Commonwealth development. I should be interested to know what their conclusions were, if the noble Marquess is in a position to tell us. At Montreal, the Commonwealth Develop- ment Bank was suggested. Was this considered, and, if so, did the views of the British Government, which I imagine are similar to those I have now been stating, prevail, or were some of our Commonwealth colleagues inclined still to favour a Commonwealth Development Bank?

Recently there have been two other related conferences which I might mention shortly because they all bear on this problem. There was the study group on Asian and African languages held in London in May, which reported, among other things, that in order to establish a better relationship with the people of Asia and Africa, and to understand them and their cultures, a knowledge of their language is necessary. The study group drew up a list of some seventy Asian and African languages, a knowledge of which they felt was essential. It set out proposals for recruitment and training of teachers and research workers, grants to students, establishment of study institutes and other schools, the provision of materials necessary for the teaching of these languages and good library facilities.

Then there was the Commonwealth Education Conference, which was opened by the noble Earl the Leader of the House, which considered how to deal with the 1,000 new places in Commonwealth universities which were agreed upon at the Montreal Conference, 500 of which are to be in the United Kingdom. I should like just to quote a short extract from The Times relating to a speech by the leader of the Pakistan delegation, Mr. Sharif: Mr. Sharif said that some nations were achieving continuously higher standards of living; but others, through lack of resources both in capital investment and in trained manpower, are finding it difficult to maintain even their existing low standards against rising population. 'The only way for us to escape from this misery-go-round of poverty, ignorance, and ill-health is to close the gap between the advanced and the underdeveloped countries by training up to the highest level of quality a host of scientists, engineers, technologists, and agricultural specialists.' I mention those two conferences, both of which dealt with education, because I think it shows that it is not just a question of even providing money. It is a question of getting down to bedrock and providing people like teachers before you can really in many cases get the development that is needed going.

I have always felt that in this field research is absolutely vital. Have we enough of it? And still more, do we make enough use of the findings of research? I remember some years ago reading a report of the United Kingdom Research Organisation which said at that lime the industrialists and manufacturers in this country were ten years behind the findings of our own research organisation; in other words, there was a ten years' gap in which they had not caught up. I always have a suspicion—I may be wrong—that in this field, even in the Commonwealth, still more in other under-developed territories, we are not sufficiently looking at the findings of the research bodies and applying them.

The Americans, at any rate, in their own country, are very good at this. They do get hold of the findings of research bodies or inventors, whether from their own country or anywhere else; and, as we know only too well, quite a number of the advances in material things for which they are famous were invented somewhere else, usually in this country, turned down here and then taken to the United States. I have mentioned before, as an example, Group Captain Whittle and the jet aircraft. The jet aircraft patent was allowed to lapse because the Air Ministry would not put up £5 for it to be renewed; and Whittle was at that time a young man in the Air Force and had not got £5. So this great invention, from which all jet aircraft and turbo-prop aircraft now stem, fell. The first patent fell because no one would put up £5. I cannot imagine that that could happen in the United States.

I do not feel that this is solely a matter for the Government. I believe that this development should be a combined operation in the West. Not only Governments, but nationalised industries, private enterprise, co-operative societies, trade unions and professional organisations should all join in a really combined effort; and without such a combined effort. I do not believe that any scheme will be a success. The noble Earl, Lord Jellicoe, mentioned other Western Powers who have funds. There is one country he did not mention that has enormous funds—Switzerland. Whether anybody will ever get any money out of the Swiss I do not know, but they certainly have enormous funds. I have argued this many times in Switzerland with the Swiss and told them in so many words that they have no tradition of development of this kind, of putting money into under-developed countries. Whereas you can get any amount of money in Switzerland at incredibly low rates of interest to build hotels and offices and that sort of thing, nevertheless they have no tradition in respect of the under-developed countries. If this project of the Outer Seven comes off, I hope that one of the things they will be able to do is to persuade one of the seven, namely Switzerland, as well as the other six, to put funds into this deserving cause.

There is very little more I want to say, except that I would emphasise what the noble Earl has said about aid not being sufficient in itself. There must be aid and trade. It is no good refusing the entry of goods of people whose economy we have built up in order to produce those goods; yet too often that is happening to-day. We are here now, one might say, as a Commonwealth or at least an under-developed territories habilitation society; but another day, on another debate, we shall find the protectionist society coming along for some industry or other, and they will not be at all inclined to let the goods come in from these territories. Indeed they are not. Probably there are now on the Order Paper one or two Motions strongly condemning the Government for doing this particular thing, namely, going into this Outer Seven pact.

Another thing we must not do is to allow the West to make artificial products which would compete unfairly with the only products, the raw materials, which they can produce or provide. We have got to be honest. Otherwise we are a lot of international Pecksniffs. We must take great care not to make our aid part of the cold war. People are not really interested in being "anti" anything. We must convince them that we are "pro" them and not "anti" anything. By the same token, we must not attach strings to our aid: there is too much of that going on. Bridges and other similar structures are labelled, "This is put up by such-and-such an aid fund". Even where there is a loan, and not aid, where there has been a grant which has to be repaid, there is a label set in the concrete by means of a copper or brass plaque saying that the building, or whatever it is, has been provided out of some international or national fund. That is not the way to do it.

The noble Earl, Lord Jellicoe, has mentioned political stability. I agree that economic stability is a very important adjunct to political stability. Recent experience in newly emerged territories, as well as in older ones, makes us wonder whether perhaps our constitutional model is in all ways suitable to Asian, African and South American countries. In a few years in many cases they have had to superimpose Western-type institutions and ways of thought on ancient tribal or other collective systems. Naturally, as we see for instance in Ghana, stresses and strains have developed. I believe that we must give these countries every sympathy based on understanding of their problems and as much assistance as we possibly can. I am sure that, with this assistance and with this sympathy, they will work out a new pattern of democratic society, one which will harmonise with the old and which will also blend the best of their ancient systems with our own. The fact that so many countries are experiencing these difficulties is no reason at all to my mind why we should not help them. Indeed, it is all the more reason why we should. Only in this spirit, I feel, should our aid be given, and only with this spirit of sympathy and understanding will our aid be a success.

7.0 p.m.

LORD GRANTCHESTER

My Lords, my remarks will be little more than comment from a rather different point of view upon some aspects of the vast problem which the noble Earl, Lord Jellicoe, has posed. The noble Earl has raised political and religious as well as economic questions, and he has done us a service by bringing this Motion to debate in your Lordships' House, particularly following the Congress recently held in London at which a great deal of discussion took place upon the subjects mentioned in the Motion.

I must admit that I was somewhat alarmed at the manner in which the Congress was staged. In many cases the delegates were almost self-appointed, responsible to no one and quite unofficial. Thus the door was opened to anyone with a bright idea to canvass, as well as to many organisations engaged in propaganda—well-meaning, no doubt, but propaganda, nevertheless—for such ideas as world government, the reform of the United Nations, federalism, the forcible redistribution of national incomes or physical resources, and so forth. All this would not have mattered, and might even have done some good, through a free exchange of ideas, if the unofficial character of the Congress could not have been called into question. I was afraid that misunderstandings might arise when Her Majesty graciously consented to open the Congress and Members of Her Majesty's Government became associated with it.

Some rather wild suggestions, in my opinion, were made, not only in discussions but in some of the papers presented; and representatives of some countries might, I felt, consider that they reflected the policy of this country, a possibility which might eventually lead to a charge of bad faith. One of the advantages of our having this debate will be to correct any such misapprehension and to enable Her Majesty's Government to state their views on what is sound economic policy. Before territories cut themselves off from those who are associated with them, and to whom they have been looking for guidance in the past, it is at least desirable that they should learn the ways of sound economic development. I shall confine myself to what is, in the broadest sense, commercial development. Defence aid and welfare aid such as that given to our British Colonies through the Colonial Development and Welfare Fund are matters which need separate consideration.

My Lords, I hope that something will be said to expose some of the fallacies current to-day among those who discuss the economic development of the less industrialised territories. The argument usually starts with the proposition that there are in the world developed and rich nations, such as Britain and the United States, and that there are underdeveloped nations, which include most of the rest; that these under-developed nations are caught in what is called a "vicious circle of poverty"; that this circle can be broken only, first, by the adoption by the under-developed countries of elaborate planning measures with respect to their domestic economies and, second, by their receiving large injections, as the noble Earl, Lord Jellicoe has said, of Government help from the richer countries.

The term "under-developed" is applied on purely materialist considerations, on a comparison of real wages and capital per capita. Such calculations do not always, I think, reflect the true position. On such a comparison, when we speak of under-developed nations we are really talking of more than half the world—about every nation, that is, except Western Europe, the United States, Canada, Australia, New Zealand, and possibly Japan and Malaya. All the rest are under-developed if one uses per capita real income figures as the basis for comparison. Yet these underdeveloped nations are not homogeneous; they exhibit wide differences of character.

It is not unreasonable to assume that these so-called under-developed countries would benefit from the application of the same economic principles from which the richer nations have benefited. What is not emphasised is that economic progress has occurred in the world; that poor nations have become rich; that there was a time when Europe and America were poor by to-day's standards. There has been, in these so-called rich countries, development on a colossal scale without central planning, without Government aid, with only normal private investment. This applies not only to the development of the United States. Western Europe itself is an example of normal development through market means over a comparatively short period. One could cite also an Eastern country, Malaya, for instance, which showed enormous advance in the early part of this century through the normal processes of the market. A good deal of progress on similar lines has already been made in West Africa.

In considering countries which are still on a subsistence economy, we must realise that it is far more important for such societies to begin to pass to a market economy on an exchange basis than it is for them to undertake huge industrial projects. There is in some quarters to-day a totally false emphasis on big and heavy industry, as distinct from agricultural development. Most of the so-called under-developed territories are heavily agricultural: agriculture is their mainstay. It is not desirable to establish in them, without any intermediate stages, heavy industrial plants such as steel mills and the like, as is often proposed, without any regard to economic conditions or to the profitability of such industry if it is established. The big industries in the rich countries have all grown from small beginnings. There was the blacksmith's shop, and, after the blacksmith's shop, a slow building of very small industrial units. To believe that countries advance simply by setting up large industrial units, irrespective of the conditions in which they can operate, is one of the fallacies of the times. Nor, if we are to learn from the past, is development best achieved by Governmental projects. It is achieved by the work and initiative of thousands of enterprising people starting in a small way, with limited capital, and extending their operations as success develops.

That does not mean that, whatever we do and however we behave, all will be well. As we see territories passing from a subsistence economy to an exchange economy, we must be prepared to join in the exchange, as both the noble Lord, Lord Ogmore, and the noble Earl. Lord Jellicoe, admitted. Sound economic development depends upon free trade between territories. It is quite hypocritical to say that we wish to see the backward territories advance and then to erect barriers against the import of the products of developing lands. Moreover (this point was not mentioned by either of the noble Lords), it is equally hypocritical to subsidise agriculture with the same object of keeping out the agricultural products of the developing territories. The provision of gift capital, which is sometimes suggested, even if it were desirable, is no cure if the products which result from the use of that capital are excluded from the markets of the givers.

I have already mentioned the undesirability of judging standards by material tests alone. With all the advances made in the material field during the last 150 years, we have still to ask whether we have progressed, even in the West. Envy, hatred, dishonesty, are more widespread than ever, and if Communism has not succeeded in its aim, expressed in the Communist manifesto of 1848, to abolish eternal truths, all religion and all morality, it is significant that it is the absence of ordinary commercial honesty that is probably the greatest hindrance to-day to economic development. A noted American economist recently stated the problem in these words: Economically foreign investment has succeeded everywhere and contributed specifically to the improvement of the standard of living in the countries in which the investments are made. But in most countries it has ended in expropriation and confiscation. Some Governments do it openly without shame; others deviously by means of discriminatory taxation and foreign exchange control. If one says today that private investment cannot do the job, it is precisely because of these anti-capitalist policies of the receiving countries. May I ask, my Lords, whether Her Majesty's Government consider some concerted action by the chief investing countries is possible to draw up a code of honest practice to which all Governments might be invited to adhere in order to make free economic development more likely over a wider area?

May I conclude by reinforcing the plea I have been making for gradual and progressive advance through the enterprise and initiative of many individuals, so that ordinary people may feel the interest and experience the excitement of participating in a developing life; that their enterprise should not be overmuch curtailed by control by so-called experts; that material progress must come stage by stage, in gradual instalments, over a period of years; that it is undesirable, even if it were possible, that Governments should pour vast sums of money into projects which become but the playthings of experts without really adding to the enjoyment of the life of the ordinary people. Even in Europe to-day we see a danger of technical inventions, artificially stimulated by large grants of public money, outstripping the ability of men to digest or put to good use the discoveries that are being made.

7.14 p.m.

LORD SALTER

My Lords, a great deal has been said, both in the brilliant speech of the noble Earl who introduced the Motion this evening and after he spoke, which I should much like to discuss on an appropriate occasion, but at this hour I propose to speak on one point only. I want to make a suggestion as to the methods and machinery of arranging loans to under-developed countries. Let me put what seems to me the crux of the problem. In my experience in relation to development schemes in a number of countries, one lesson has been burned into me, both in success and in failure—namely, that it is quite indispensable for success to have an administration that will secure the reasonably efficient use of the money that is supplied, and that there is a Government sufficiently stable and of such a kind as to make that administration possible.

The most successful schemes with which I personally have ever been associated were those in the early 'twenties undertaken by the League of Nations in Austria, in Hungary, in Greece and in Bulgaria. There we achieved great success. We did so because the psychology and political attitude of the beneficiary countries was such as actually to welcome some form of external control during the crucial years. In regard to the countries we now have in mind, that particular advantage is not available, and we have to find something else. But, negatively, I remember that in China it did not matter how good the advice or intrinsically good a particular scheme might be, it had no chance of success because there was no Government with more than the most limited range of authority and the most precarious tenure except within a very narrow sphere

Much more recently, going to Iraq, where every possible technical condition seemed to be quite unusually favourable for an immense and rapid development, one had only one doubt, and that was whether the administration would be sufficiently efficient, and whether the political regime there would be such as to make that possible. Well, everything went extremely well until a year ago. Now, necessarily, a question mark hangs over the future.

Having said that, I must add that I entirely agree with what has been said about the importance of not attaching the kind of political strings that are inevitably so much resented. But I think that we have to make a distinction between political strings and economic safeguards designed for and essential to the success of the actual economic project on hand. This brings us right up to the question of how and by what machinery. I think it is rarely that political representatives of a national Government of a country from which capital is coming will be able to negotiate appropriate safeguards as to the choice of project, as to the method of its administration, or as to the environment of fiscal policy which is necessary for the success of that project. What they try to impose will be resented and, if verbally agreed to, will probably be destroyed a little later. However, it is, I think, certainly true that if you can get your arrangements made with the recipient country by an institution that is international, you can go a good deal further, and if the institution is not only international but is essentially of a banking and technical character, you can go further still. Safeguards that would be, and indeed are, accepted when arranged by the International Bank, could not be secured by political representatives of separate national Governments. Can we then entrust this task to the International Bank? Here, again, there is a considerable difficulty to which I will refer in a moment.

There is indeed a great deal to be said against the alternatives that have sometimes been suggested. I entirely agree, for the reasons that have been given this evening, that it is most unsuitable to ask N.A.T.O. to enlarge itself for this purpose. That would underline and emphasise just the kind of political difficulties of voting sentiments which we most need to avoid. I am very doubtful, too. about the creation of a completely new institution, whether we call it an International Development Agency or whatever it may be, independent of the existing international agencies, separate from them, possibly rivalling them, overlapping them and without the experience and technical skill at their disposal. At least I should like to know much more about the composition of such a new proposed body and of its precise relationship to the existing bodies before I personally would be prepared to say that I should be in agreement with it.

Can, therefore, the task be entrusted to the International Bank, the World Bank? There we come up against a difficulty of a different character. The International Bank has a high and a deserved reputation for making sound loans which have been successful, without involving loss to the International Bank itself. It has a high financial reputation as well as having done a great deal of work of very great use in the world. Yes; but that of course means that, quite apart from arranging safeguards that are technically good, the loans must be "hard" in the sense that they do not exceed in a particular country a total which makes the risk a reasonable risk for a prudent banker. At the same time it is undoubtedly true that if you limit yourself in regard to the under-developed countries which we have in mind entirely to "hard" loans of that character you will not be able, whatever may be the financial resources at your disposal, effectively to get anything like enough to meet the economic opportunities that exist in these countries, or to satisfy the expectations of their peoples or to give a good show by comparison with others who are making conflicting or competing offers.

How, then, do we resolve this problem? Undoubtedly loans that would not in their amount, at least, satisfy the conditions of a prudent banker need to be made and they must be made at the risk of the public funds of the contributing countries; that is to say, the Treasuries or Foreign Offices or State Departments of the capital-forming countries. But, as I said, if those departments themselves negotiate they will meet such resentment and difficulty as will make their task impossible. If, on the other hand, they hand over the matter to the international Bank and the Bank makes loans that are "soft" as well as "hard", the Bank may lose its present high reputation and destroy its utility for the very valuable and important work it is now, and has been for many years, engaged upon.

Is there any way out of this dilemma? I suggest this principle. I think that perhaps the International Bank, with the Monetary Fund in association with it, could be brought into such relation with the departments of the national Governments from which extra money will come as to negotiate what I think Mr. Douglas Dillon called a "package" deal; to negotiate arrangements which would really be in two parts. The safeguards would be negotiated by the Bank, but the amounts forthcoming would be greater than the Bank as a banking institution could prudently provide. There would therefore have to be an arrangement between the Bank and the national Governments which would in effect mean that as far as the loans were "hard" the loans would be the Bank's risk, as its present loans are, but beyond that point, though the loan might still prove to be good, the risk would be taken by the Treasuries of the national Governments.

That, I think, is not an impossible arrangement. The Bank, so to speak, in regard to these loans would be like a lender holding a first mortgage and the Governments would take the position of a lender who was content to take a second mortgage. This, of course, is a complex suggestion that I ought to describe and defend more than it is possible or would be tolerable to your Lordships that I should attempt to do to-night. I should be happy to supplement the suggestion on an appropriate occasion, but for the moment I leave it at that.

7.26 p.m.

LORD BIRDWOOD

My Lords, I am sure we are all very grateful for the exposition which my noble friend Lord Salter has given us. For me, to whom economics is a rather distant kind of magic, I confess I have heard for the first time an explanation of a logical way in which aid could pass from, shall we say, the over-developed to the underdeveloped world, and I would certainly not try to follow him in enlarging in any way on an aspect which he has so brilliantly described.

I think our great regret this evening is that so challenging an aspect of the international scene comes at a time when your Lordships have so many other things to think about, particularly in the domestic field; and it seems bad luck after the noble Earl has presented this matter to us with great skill and care and thought. After all, this is a new problem in the world. As I see it, it has arisen only in the last forty years. When we recall that only within these last fourteen years the United Nations have spread from a family of 51 to 82, and of the new entrants every single one could be, as the noble Lord, Lord Ogmore, reminded us, regarded as either uncommitted or underdeveloped or both, then I think we realise the nature and urgency of the problem; and we in Britain, who have great experience in this particular field, surely have our great and imaginative part to play in the future.

I am not going to attempt to elaborate any sort of fool-proof international administrative machinery to meet the needs. We have heard discussed this afternoon whether the United Nations should shoulder the main responsibility in this task, or, not so much the Atlantic community but (and I was interested to note that the noble Earl laid emphasis on it) the European community as such. Personally, I should like to see the European community taking the initiative, provided always, as has been stressed, that in no way the concept of a military or strategic alliance is imported into the very contrasted atmosphere of laying sound economic foundations—which I think is quoting the noble Earl's Motion.

It is, I suppose, true that we should all be governed by that old adage that asks us to remember that one can do a lot of good if one does not mind who takes the credit. I personally should like to see Europe taking the credit, not only for reasons of sentiment but perhaps for practical reasons, practical reasons in that one would start off with a uniformity of approach in regard to the necessary skills and techniques which have to be imported into under-developed countries, which would be more effective and more manageable, as I see it, than aid given and organised and directed against the very diversified background of the United Nations.

It may be that I am quite wrong in this; and certainly I have no set conviction in the matter. In any case, I am not qualified to be assertive. Indeed, all I intend to do in a few minutes is to lay emphasis on certain principles—and here I believe I shall find myself in great agreement with the noble Lord, Lord Grantchester—which I consider are too little understood and which are fundamental to the establishment of a sound economic foundation. I have no specific economic training, but I have had some practical experience in countries which could be regarded as having an economic foundation such as not to encourage the development of those political institutions which we usually associate with progressive communities. Now it seems to me that we have been all agreed that to go into a country merely with a set of abstract concepts of high intention, and just hope that it will all come true, is not going to be enough. You cannot dig drains only with a moral intention or purpose.

I think also that we shall this evening have debunked the idea that mere gifts or loans measured in quantities of dollars will by themselves raise the standard of life of a people. I can recall an American statesman whose voice shakes with emotion as he describes how the surplus wealth from the West will pour into the Middle East; the wealth that, in his view, should turn camels and goats into Cadillacs and Coca-Cola. I think we have to realise that in fact real prosperity can never be given by one nation to another nation, or by one set of nations to another nation. And I would disagree profoundly with Mr. Bevan who recently in Hamburg, when addressing the Socialist International, spoke of this country as providing a higher standard of life for the Middle East. For applause at a meeting, or for the purposes of quick popularity in the Middle East, that may be effective. But it is not, in my view, related to reality. Nor will mere material benevolence align a people in a conveniently correct political relationship with the West. Instead, as the noble Lord, Lord Grantchester suggested, we have got to learn this thing the hard way; and it takes a long and careful study and preparation, very far removed from politics, and related to the practical things that men can think out with their brains and do with their hands.

In very simple terms, I see the requirement as, first, one of making a survey of things as they are and not as we should like them to be—assessing the resources, the men and material in a territory; and then, and then only, deciding what can and should be done. One difficulty in deciding these development programmes is this instinct—amounting, as I see it, to an obsession—that heavy industry is the hallmark of wealth and progress. It seems; to become a matter of prestige for a country particularly in its first flush of political independence, to demand an industrial self-sufficiency which its raw materials in no way justify. In those circumstances, I suggest that it is no service whatsoever to a country for the West to encourage what I can describe only as disloyalty to a country's environment. If the natural economy of a country is agricultural, then that country, as I see it, will be all the more prosperous for concentrating on improving existing resources, whether for export, to save foreign exchange or to earn foreign exchange, or merely to put more food into the mouths of its people.

LORD OGMORE

May I interrupt the noble Lord? He is making the same point as Lord Grantchester made; but in these countries it is not the difference between agriculture on the one hand and heavy industry on the other. In fact, what they are trying to do is to develop secondary industries which will make use of a lot of their agricultural products. That is what they mean by industrial development; not the creation of steel mills, and so on.

LORD BIRDWOOD

I do not quite agree with the noble Lord. I do not know whether the noble Lord remembers the great Industrial Development Corporation outside and around Karachi. Pakistan is essentially an agricultural country, and there is a mass of big industry there which the country itself has found it cannot sustain.

My Lords, if there be any truth in what I have said, it implies that it may be wiser to develop the existing facilities rather than to create new ones. If I may give an example, we can all think of certain countries where the farmers take water off small, modest irrigation systems; from springs of streams, or from tanks and reservoirs and the like. As often as not, those systems lend themselves to improvement and expansion which could double the productivity of the existing acreage, which, in turn, would put roughly double the income into the farmer's pocket. That, in turn, creates local demand, and stimulates the local industry. So you get a chain reaction set in motion: and the merit of the process seems to me just this: that it remains both indigenous and self-creative.

Now compare that kind of development with the more familiar situation where a Government falls for the temptation of opening up vast tracts of new territory. Along come the Western firms and the big engineers, and there is a scramble for the contract. Not unnaturally, the contract goes to the lowest tender, and frequently that by no means represents the most serviceable and enduring work on the job. The final effect usually is merely to create another million mouths or so to feed. So far as irrigation is concerned, I should like to quote what a well-known irrigation engineer, Mr. Michael Ionides, has said of this situation: We ought to judge irrigation schemes in terms of new water put on the land rather than in terms of new areas of land put under water. That, in his view, was a more economic and better use, in the social sense, of the available resources.

I have contrasted those two methods of development, and I do not necessarily say that either is always wrong or that either is necessarily always right. But what I do maintain is that which is right and which is wrong is seldom really considered; so far as I can see, the international machinery for its consideration just does not exist. Nor do I think, my Lords, that social implications of development are in any way given sufficient thought. Without a doubt, any under-developed country which now seeks to integrate itself into the modern mechanised world is bound at some time to transform the whole of its social and administrative structure. The noble Earl has quoted Mr. Paul Hoffman. It was Mr. Paul Hoffman, I think, who said of the Nile that it had been fully and thoroughly surveyed as to the water; that the hydrographic data is all there; the engineering requirements are known, as is the new acreage which will come under development, and its measurements and location. All those things are known, but what no one has bothered to find out is what happens to the lives of the population which might move into the new areas which are opened up. No one has related their economy and their social pattern to that knowledge of the behaviour of the river.

My Lords, I could put this problem of the social development in perhaps a concentrated form by reminding your Lordships of a little story that I heard in Kuwait. When I was in Kuwait two or three years ago they told me that a small Arab boy could draw with perfect accuracy the silhouette of a Cadillac car long before he could draw a picture of his own house. I suggest that the task of the Western world and of the world that accepts Western aid is to teach the little boy to draw his house before he can draw a Cadillac.

We in the West—and I think we can take our country as a fair example—have been able to adapt ourselves step by step to the pattern of mechanisation and advance of science, because these advances have come always from within. We ourselves have been the inventors, as often as not, and initiators of these advances, and they have been spread evenly over the land on the basis of local availability and know-how. But exactly the reverse is the process in the under-developed countries. The physical machinery, the training and the basic knowledge usually have all to be imported, and those who have to import them are usually the smallest section of the population, who are fortunate enough to have acquired the education which will appreciate the nature of the modern industrial processes. On them surely rests a grave responsibility, because they happen also to be the policymakers. It is they who have to choose the whole pattern of the development of their land, and it is on their choice and on their judgment which must depend the kind of lives that their people have to live and the general social and economic pattern that their country must develop.

In that task of laying their plans, we can only hope and pray that they will always bear in mind the great truth: that the real reserves of capital, the real prosperity of a nation, rest on the collective skill and will of its own people. Foreign capital, investment grants or loans, whether on an international scale, a governmental scale or a private scale, may pour in. Foreign know-how may help to launch their schemes, and indeed, as I see it, that is its task. Foreign know-how may map the necessary course. But unless the people can use it in the right way, and, perhaps more important, have the will to do so, then I suggest that the schemes will fade away and the house, rather than being built on rock, will be found to have been built on shifting sand.

I think that at this moment I should say a word about a development to which the noble Earl referred. We are apt to judge this problem on an international basis, as one between a rich country and a poor country, comparing perhaps the wealth of the Ruhr with the Korean countryside. But we have exactly that same disparity within those countries themselves. The new wealth, whether from rubber, uranium or oil, and its management and the management of all the related mushroom activities which come with it, remain concentrated in the towns. That will of the people of which I spoke remains an urban will, and the result is that the peasantry, that same peasantry of whom Oliver Goldsmith said …once destroyed, can never be supplied", desert their fields, and, as the noble Earl reminded us, squat themselves in the most appalling squalor around the towns in search of the opportunities and high wages which never come.

How can that rot be stopped? As I said, only by applying this new wealth to stimulate rural small industries. Alas! such wisdom is neither very spectacular nor has it much voting appeal. I have maintained that the real wealth of a nation resides in the will and brains of its people. If so, the educational service and the pattern of education must certainly be related closely to economic advances. If the system of education is broadly based and tied to the immediate needs of these rural communities, then that town drift will never take place, because the stimulus which creates the necessary will of the people will be their own support and will not have to be sought out in the towns.

I am aware that I have made only a sketchy diagnosis without suggesting any remedy. I have done so in the belief that the modern tendency is to go for the remedy before, or even without, diagnosis. That diagnosis has led me to the conclusion that there are far more problems waiting to be solved within these countries themselves than by a committed world which seeks to help them. At that international conference in Hamburg, Mr. Bevan also spoke of the oil royalties which, he said, could be used for the great advancement of the Middle East. He added that it was to their advantage that the area should be regarded as an integrated unit. That is perfectly true; but what Mr. Bevan did not say is that the very first people who have to be persuaded are the Arabs themselves, who have to apply the integration.

As to the scientific initial diagnosis, the United Nations Special Fund has been mentioned, and if, as I believe, it encourages and provides the means by which that essential survey can be made, I would certainly agree with the noble Earl that it merits far more support than we are prepared to give it at present. The noble Earl mentioned an international technical survey. I can recall the proposal for an international civil service coming up at the meeting of World Government at Copenhagen in 1952, and at the 13th Session of the United Nations last year a proposal for an international administrative service was defeated, alas! by an overwhelming majority, which included the whole of the Soviet bloc. Therefore, I would suggest that probably a more practical approach might be to recognise some form of an international research institute which perhaps would be the forerunner of a service. And if the problems which I have only touched upon exist, are little understood and are neglected, surely it is a matter for just such an international institute of public administration, perhaps as a counterpart of our own Royal Institute of a similar nature. I quoted the case of the gap in our knowledge of the Nile. It would be just that kind of problem at which such an international institute would be fitted to take a look.

Finally, I would sound just one note of criticism and warning. I know that it is taboo these days to hint at the merits of colonial systems, but, believing in the logic of borrowing what is good from all systems, as I do, I suggest that there is a missing link in the manner in which we envisage aid passing from an international dispensation; that it would lack those personal associations which, wherever the fate of one country is tied to aid exclusively given from another country, do seem to be effective. The great Gezira cotton scheme in the Sudan is surely as fine an example of progress, economic, social and political, since all its elements were planned together, as one could wish to find in the world; and yet it is built entirely on an exclusive relationship between this country and the Sudan. I can see no reason why an international dispensation, or a European dispensation, should not set about evolving their policies, bearing in mind the great value to be derived from a retention of that element of personal relationship which we recognise in systems which are now slowly, but perhaps inevitably, passing off the stage of international affairs.

7.50 p.m.

THE EARL OF BESSBOROUGH

My Lords, the noble Earl, Lord Jellicoe, is to be congratulated on putting forward his Motion to-day and on deciding to pursue it, because I feel that the subjects which have been raised lie at the very roots of our foreign policy and may, in fact, develop into the most important aspect of our relations with other countries, and especially the uncommitted countries. Like the noble Earl, Lord Jellicoe, I was also a delegate to the Atlantic Congress and sat under the wise guidance of the noble Lord, Lord Crathorne, who we are so glad has joined us in this House. I have also, during the past six or seven years, paid a number of visits, albeit fairly brief ones, to the Middle East—indeed I returned only last week from the last one. Although my knowledge of these countries is not so great as that of the noble Earl, I have had some experience, particularly of their economic problems, relating especially to certain aspects of their industrial development. I agree with the noble Earl that perhaps the major task confronting the countries of the Atlantic Community over the next decade is that of striking the right relationship with these developing countries. It is wrong to call them under-developed or even backward. Egyptians quickly became efficient pilots in the Suez Canal; Iraqis were trained more rapidly than anyone suspected in the arts of the electronic engineer.

But the aspect of these problems to which I should particularly like to refer at this late hour is the general attitude and outlook of the Western Powers, and particularly this country, towards the Governments and peoples of these free and independent States. I am sorry to say that I do not feel that, by and large, we have always adopted the right attitude. I do not think that this is the fault of the Foreign Office, and certainly not of my right honourable friend the Foreign Secretary or of his Minister of State, or of the noble Marquess who is to reply to the debate. They, I know, take an imaginative view of our relationships with these countries. But I am sorry to say that I feel the attitude of certain members of some of Her Majesty's missions on the spot is not always such as to create the best relations with these newly developing countries, nor to achieve the best results in so far as British industry and our export market is concerned. Some of our representatives—and I can think of one, in particular, in that part of the world—are highly imaginative and robust, who follow out admirably what I believe to be the attitude that Her Majesty's Government would like them to adopt. They know that these countries are proud of their newly won independence. They recognise that in granting aid to them it is a great mistake to attach strings; and in their general relations with Ministers, officials and people on the spot they treat them as equals and partners.

Unfortunately, this enlightened, forward-looking attitude is not universal. In certain capitals the head of a mission and members of his staff, and even, curiously enough, sometimes younger members of the staff, seem incapable of resisting the temptation to take up a kind of patronising "wet nurse" attitude towards officials of the country to which they are accredited. Some of them have even been described by friends of mine in industry as pompous and "prissy" in varying degrees, and even prim and prudish. I know how easy it is to get like that, for I have served in the Service myself. But in no case does that attitude improve relations with that country; nor does it facilitate industrial activity by British firms.

In one capital in the Middle East, I recall that a few years ago a member of the Embassy, in his normal, perhaps unofficial, relations with local officials took up the attitude that such-and-such a country was not ready for a particular form of technical development and advised the British firms not to press on with trying to sell their equipment to that country. Executives of the firms concerned went out to the country and tried to sell their equipment, offering at the same time to bring over trainees to this country—and that seems to me to be even more important sometimes than training technicians on the spot. The executives of the firm had to return to this country, but members of Her Majesty's Embassy remained on the spot; and when the executives had gone an official of the Embassy privately discouraged local officials from proceeding with the particular plan, and may also, I believe, have given advice on a matter about which he knew very little. The result in that case was that another company from another country quickly jumped into the breach, and all the orders were lost to British industry. That was disastrous.

In other capitals somewhat similar situations have arisen. I will not burden your Lordships with details, but I should be glad to give them to the noble Marquess or to any of his right honourable friends if they are not already aware of them. In some cases it has been possible at the last moment to retrieve something, but not always. You sometimes find among our representatives, I fear, the attitude that certain, say, types of equipment are rather like dangerous toys with which these less well developed countries would be ill-advised to play. You also find the opinion expressed that the country concerned perhaps cannot afford some particular form of development. It seems to me that in those cases we must stick rigidly to the rule of "no strings", and not even give private advice on the detailed expenditure incurred by such a country. These countries should be allowed to buy what they want and to learn by their own mistakes. Otherwise, if we advise or cajole them, the two unhappy effects which I have mentioned are almost certain to come about.

I did not find our German friends in the Middle East taking up the attitude which I fear certain British and American officials have been known to do. Neither, I need hardly say, do our Soviet friends. They are hard and realistic in their commercial and economic policies. They would not take up any patronising attitude. They take off their coats, roll up their sleeves and get down to business, treating officials on the spot as their equals and comrades in a new enterprise. How different this can be from Her Majesty's Ambassador driving down the main street in his upright Rolls, and sometimes in his top hat! I am not saying that an Ambassador should not drive in a Rolls or occasionally wear a top hat. I merely say that, in doing so, he presents a different picture from others, and very different from all the Arabs, who to-day, I am sorry to say, drive around mainly in Cadillacs and Mercedes. What I mean to say is that, while I believe in tradition, we must sometimes, and especially in these countries, break away from it and realise that. we are living in a modern technological world.

But I would not only venture to criticise our own official representatives. Some local representatives of industry also adopt the wrong attitude with labour on the spot. We, the British, cannot sometimes resist the temptation of reverting to a kind of "pukka-Poonah" attitude in dealing with local labour. In this connection, it is significant that some of the more successful British firms in that part of the world feel obliged to employ foreign and neutral representatives, such as Belgians or Swedes, as their agents. But in all this what worries me most are the sometimes unhappy relations between our own officials and representatives of British industry. I occasionally wonder whether our officials, who may have spent long years in the country concerned, may not be jealous of representatives who come out on specific visits and then have to go on to other countries or go home rapidly by Comet. I believe there is a certain jealousy existing there which has not been good for relations.

There are so many Foreign Service officials waiting to make their mark. They themselves recognise that they are fairly thick on the ground. Many are filled with feelings of frustrated ambition. As a result, they feel it necessary to re-analyse and re-assess every problem, perhaps in order to satisfy their own ego. Thus, instead of doing the good which they genuinely desire to do, they do harm. They are so tied up with their clerical procedures. All this should not be; but whether it is the case or not, it is true that officials and industrialists are trained in totally different, often diametrically opposite, ways.

I regret to have to speak thus, for I spent happy years in the Foreign Service and I learnt, I hope not too inadequately, the necessary procedure of how to record in minute form, in draft dispatches or telegram, anything which might seem likely to become of any importance. That report may eventually have got back to England with suitable drafting amendments by other members of the Embassy. I was one who was trained, like the noble Earl, Lord Jellicoe, to work like that. Then when I went into industry I found that quite different methods were employed. Instead of referring everything back, you suddenly had to take certain decisions on your own. If you put the lot down on paper, no one read it. You had to telephone at once, and get on with the job, rather than discuss it on paper over a matter of days or even weeks.

It seems to me that this difficult relationship between British official and business man may be at the root of our problem. There are, of course, rights and wrongs on both sides. But I think this is a subject which might well merit a special debate in your Lordships' House. I would propose to discuss the idea of setting down a Motion with the noble Lord, Lord Strang, who must be fully conscious of this particular problem. There are other senior and distinguished members of the Foreign Service who have recently also been in industry. They fully appreciate the problem, and, at the same time, there are officials who have gone into industry. But that traffic is, on the whole, very small, and there is not the necessary flow back and forth. My own feeling is that there ought to be a more regular interchange from the earlier years. For example, a bright young man who had been three or four years in some up-and-coming industry might do two or three years in one of our Embassies abroad, and vice versa. Then, perhaps, we might understand each other's respective methods rather better.

I do not believe that in these days, even in regard to the Foreign Service, the security aspect should in any way be used as an argument against such an interchange, for the secrets of industry are often as important and valuable as the secrets of diplomacy. I feel that we should all, the whole nation, the Government, business and the people go forward together in our attitude towards these developing countries more successfully if such exchanges were arranged.

I beg you, my Lords—and I must be forgiven for having detained your Lordships so long—to give this problem your serious consideration. I would beg my right honourable friend the Foreign Secretary, and my other friends in the Foreign Office, to think on these things. One of the most interesting papers at the Atlantic Congress was, as the noble Earl, Lord Jellicoe, knows, produced by Mr. William Clark. Mr. Clark is a distinguished economist and journalist who has spent a good deal of time in Afro-Asian countries, and particularly in the great Republic of India. I do not know whether he would endorse the strictures which I have made this afternoon, but he made one primordial point in that paper when he said that we in Britain and we in the Western countries must mix ourselves up more with the world's poor as partners and as friends, and not as patrons. We should not give things away "for free", if your Lordships will permit the term. These developing countries should have to pay for what they get. It looks suspicious to some if free gifts are offered, even if it is stated that no string is, in fact, attached. And it is true, perhaps, that our American friends have been more guilty in this respect than we have.

I fully agree with the noble Earl, Lord Jellicoe, and I think it is also the view of the noble Lord, Lord Salter, that aid, when possible, should be granted direct through the private channels of finance and industry, or through an international body such as the World Bank, rather than directly from the Government of a specific country. I agree with the noble Earl, Lord Jellicoe, and the noble Lord, Lord Salter, that there should be some kind of improved machinery—if not a new agency, at least improved machinery—for extending "soft" loans by Governments. But this, of course, could not be done through N.A.T.O. Obviously, "hard" loans are not so difficult to arrange. However, if, as Mr. William Clark said, the West simply lends money and various forms of industrial capacity without a psychological change in our outlook, all our plans will crumble. These countries must be brought to develop a wealth-producing capacity of their own. I am told—and I think the noble Earl would endorse this—that it would cost the Western countries only about one half of 1 per cent. per annum of their total national incomes to achieve this. This is not a completely unattainable sum. I only hope that an eventual reduction in arms expenditure may help the West to do more. But, above all, we must change our outlook.

8.7 p.m.

LORD ABERDARE

My Lords, so far as national economic policy is concerned the nations of the Western World have learnt the lesson that too great a gap between the rich and the poor is liable to lead to unrest and instability in any country. But this lesson has not yet been learned in our international economic affairs, although I believe that in general it holds true. The existence of wide differences in wealth between nations is just as likely to lead to unrest and instability internationally, and I think it is possible to visualise a much more peaceful world were the present underdeveloped countries able to support their citizens at a higher level of existence. Quite clearly, were a World Government ever to be realised, one of its first steps would be to use the resources of the richer nations to subsidise the standard of living of the poorer nations. Equally true, I think, is the analogy between internal economic affairs and international affairs, in the fact of the economic advantage to us all of a wider spread of purchasing power.

At the present moment the pace of modern industrial development is such that the poorer nations can see the rich increasing their wealth at an evergrowing rate. I do not believe it is any good the noble Lord, Lord Grantchester, or even my noble friend Lord Birdwood, saying that it is not desirable for these under-developed countries to industrialise themselves. These people wish to industrialise themselves, and if we do not help them somebody else will. As the noble Lord, Lord Ogmore, said, they will. certainly be looking with great interest at the progress of China, who has recently abandoned the Western form of capitalism and is making a vast effort towards industrial development under a Communist system. They will most certainly compare it with the progress made in India under a capitalist system. That is the challenge which we in the West must face.

So far as the Commonwealth is concerned I think we have realised our responsibilities, and if I may quote just a short passage from the Report of the Montreal Conference, it seems to me what was then said about the development of the Commonwealth is equally true in a world context. The Report said: We cannot be indifferent to the poverty of some Commonwealth countries. The concern we feel is based fundamentally on common humanity, but it is supported as well by the knowledge that the economic development of Commonwealth countries would be of material benefit to us all. We also know that if the hopes of the less developed countries are too long deferred the democratic institutions which we all cherish might be in danger. I feel absolutely certain that that applies to the under-developed countries of the world as well as to the Commonwealth countries.

In developing a policy for the future I should like to emphasise one point that has already been made by the noble Earl, Lord Jellicoe, and others; and that is the necessity of taking into account the psychology of the people whom we are trying to assist. Mostly they consist of ex-Colonial territories, highly suspicious of any new form of economic colonialism. Soviet propaganda is constantly emphasising the fact that, in their version, Russian aid is without strings, while aid from the West is "economic Imperialism". It was vividly expressed, although perhaps somewhat exaggeratedly, by a Nigerian recently who wrote: If Nigeria must take aids, whether from Washington or Moscow, London or Delhi, she should do so with caution. Africans brought up on the farm or in the open countryside must have watched a bee or fly hovering over honey and subsequently alighting on it. First the legs get stuck and then the wings. Soon the whole insect is completely stuck, body and all. The developed countries are comparable to the honey and the under-developed to the insect. It is, therefore, very important, to my mind, that economic assistance from outside must be closely co-ordinated with local initiative. It is essential to remove all fear of economic exploitation and to create an atmosphere of joint participation for mutual benefit.

I agree wholeheartedly with what the noble Earl, Lord Jellicoe, has expressed as the means with which we might go about this task. It is, I am sure, especially important to provide skilled technicians, although the problem here is acute, for it is so hard to find men of the requisite skill who are ready to accept a short-term contract, to live in a remote area of the world and accept the authority of people whose wisdom they may doubt. It is very much easier for those trained behind the Iron Curtain: they go where they are told, they are trained as arranged, and there is no argument about it. It is therefore very much to be hoped that we shall make rapid progress with the education of the local people themselves in technical skills. And here also I think that the Commonwealth has shown the way, with the Colombo Plan, an excellent example of full co-operation on a basis of equality between nations of varying economic strength, the underlying principle being that those who can afford the most will make the greatest contribution.

Underlying the whole system of aid to the under-developed countries I would also support what has already been said, the necessity of ensuring markets for their primary products in order that they themselves may be able to contribute to their capital programmes. I will not go into the question of whether a new agency is required. I personally do not believe that any one agency can meet the situation. It may well be, as my noble friend Lord Jellicoe said, that a subsidiary organisation of the International Bank is necessary to provide the capital on easier terms. But in general I think that the more sources of capital and skilled technicians, and so forth, there are, the better it will meet up to the varying needs that there are.

What I believe is important is that those who are in positions of responsibility in the under-developed countries should know what agencies there are open to them, and I believe that the United Nations might play a useful role in supplying them with that information. For example, the Economic Commission for Africa would be doing the African countries a service if it produced a survey of the whole field of agencies and institutions able to assist them in their economic development. I would also stress the need not only for aid to be given but for it to be seen to be given, and for the full use of information services for the purpose of educating public opinion in the under-developed countries to a realisation of what is being done by the West for their economic assistance. It is very easy at the moment for a comparatively modest amount of Russian aid to be magnified at the expense of the continuing efforts of the Western World: one spectacular effort is always more newsworthy than a continuing process. But, my Lords, our achievements are far from insignificant, and I hope, that they will be given the publicity they deserve.

8.17 p.m.

VISCOUNT GOSCHEN

My Lords, I should like first to correct one impression which the noble Earl, Lord Jellicoe, in his opening remarks, may have made upon your Lordships. He said that there were a great many eminent delegates to this Congress which took place earlier in June, and himself. In fact I know full well that he himself did a great deal of work before this Conference began and was largely responsible for its success. I agree with the Motion and I support it.

I do not intend to go into the economic side of this problem of these conferences and what they stand for at all, but propose to speak for two or three minutes on one aspect which does worry me. Like the noble Lord, Lord Ogmore, I have been a delegate to the N.A.T.O. Parliamentarians' Conference—I think I have been for four years. He is perfectly right when he says that the opinion there has rather changed. In my early days most of the opinion and most of the thought at the Conference was directed to the military side, but of recent years the economic and the scientific—and I think particularly the scientific—sides have been brought out much more clearly. At this Atlantic Congress that was even more noticeable.

Many noble Lords have talked about under-developed nations being suspicious about gifts and being suspicious of the designs of the givers. I think that is absolutely true, and the psychological approach is very necessary. But I believe that one of the most important things is that the people of the countries of the Atlantic Community and N.A.T.O. are themselves suspicious when they hear about giving aid to the under-developed countries, because I do not think they really know what it means. I do not think this is the fault of the Press or wireless and television: I believe that a great many people in this country do not take the slightest interest in the affairs of N.A.T.O. or the Atlantic Community. They really take notice of N.A.T.O. only when the question of nuclear weapons comes up or through some crisis; they do not realise what N.A.T.O. is doing on the economic side, and I am quite certain they do not know what this aid to the under-developed countries means to the countries concerned. I hope that the Government will work out some means of educating the public, and that Governments in the other Atlantic Community countries will do the same. To put it in this way, the results of the conferences we hold are very often not known to the general public at all. They should be brought to the notice of people generally more than they are. I am sure that this is very important.

The noble Lord, Lord Ogmore, has already said how important the Congress itself was. I agree with every word he said about that. I think that we are all proud of being Englishmen. Those of us who were at the Congress or who were delegates to the Congress were particularly proud. It was very gratifying when delegates from the other countries represented at the Congress spoke to one and said, as many of them did, that there is only one nation which could have put on such an opening for a Congress like that, namely, Britain. This is very gratifying, and I am sure that noble Lords will bear me out and agree that that was so.

People from overseas were really extremely impressed. Many of them had never been to England or to London before. Some of the old, hardened Parliamentarians are always pleased to come back, and will say so, but many of the business people and the business delegates had never been to England hitherto. They were all very impressed by everything. They saw that we had come out of our economic crisis and that things were really quite good in England at the present time. They were even very surprised at the fine weather provided for them in England.

As to the entertainment side, the noble Lord, Lord Ogmore, has already spoken of this, and I will add my tribute to the noble Baroness, Lady Elliot of Harwood, for the magnificent way in which she arranged everything. Both for the delegates and for their wives and families there was hardly a moment when they were not being entertained in some way or another. All of this did this country a great deal of good.

I hope that, when conferences are arranged in other places in the future, they will be attended by representative people who are willing to learn from other countries and to take an interest in how other countries live and what they do.

LORD OGMORE

May I tell the noble Viscount, Lord Goschen, that I forgot to mention in my speech that the Congress gave the British delegation and people a standing ovation, which, I think, must be unique in history.

VISCOUNT GOSCHEN

I, also, had forgotten that.

8.23 p.m.

BARONESS ELLIOT OF HARWOOD

My Lords, I rise at this late hour to make a very short contribution and to apologise at the outset to the noble Lord, Lord Ogmore, for not being present when he, I understand, kindly made some very flattering remarks about the contribution which the hospitality committee, under my chairmanship, made to the Congress. Unfortunately, a meeting in connection with the World Refugee Year clashed with the beginning of this debate and I was not able to be present for the opening speeches. I should like to say how grateful I am for the kind remarks which he and the noble Viscount, Lord Goschen, made.

To the noble Lord, Lord Grantchester, who seemed a little nervous about the appointment of the delegates, I will say that, so far as I know, the Parliamentary delegations were appointed by the Speaker from another place and by the Lord Chancellor. I was very honoured to be asked to be a delegate, and I think, on the whole, that the nervousness which the noble Lord expressed was, perhaps, not justified.

This was the first time that I had been a delegate to the Conference of N.A.T.O. Parliamentarians. It was the first time, I think, that such a large Congress had ever been organised by the N.A.T.O. Parliamentarians. It seemed to me that there were two themes running through the whole Congress, which struck me very forcibly: first, that all the N.A.T.O. countries present were anxious to co-operate together in the non-military field as well as the military field, and, second, that the countries known as the free world countries realise that freedom is not defended behind a Maginot Line somewhere in Europe but that, all over the world wherever Communism gains a hold, freedom is in jeopardy. The most recent example, the tragedy in Tibet, is a case in point, where the methods were all too obvious and, alas! successful.

The theme running through all the committees of the Congress was, inevitably, how we might co-operate to preserve peace and protect freedom. This is all the more complicated since the language used by Communist politicians is the same as that used by the free world—"liberation from Fascist aggression", and the "establishment of true democratic government"—the words in both cases being unexceptionable but the results being exactly the opposite, as we know from Hungary and Tibet. This means that, among the N.A.T.O. countries and further afield, if we are to build up nations capable of withstanding Communist blandishments we must look to methods other than military and to points of view other than these of defence. That is why I was glad that the noble Earl, Lord Jellicoe, put down his Motion, which was the subject of the committee on which we both served and the implications of which are very far-reaching.

If the under-developed areas of the world were coloured red on the map, as used to be the British Empire in school atlases when I was at school, vast areas would be revealed, and, in the twentieth century, when the skill of man is so great, it is almost impossible to say that potential wealth does not lie everywhere. When the State of Israel can make the desert sands bear fruit in abundance, and the Trucial Coast produces millions of gallons of fuel oil, the Sahara may not be a desert except to the eye. One can look at no place on the map and say that this is barren land of no use for anything, for who knows?

Thus, the speed with which twentieth-century developments take place is so great that, if one thinks of one aspect alone, namely agriculture, which was mentioned by Lord Birdwood, it is clear that the mechanisation of cultivation and the increasing of yields through the skilful application of fertilisers and so forth can increase the potential production of the under-developed countries very rapidly. Men who cannot read or write can easily be taught to drive a tractor or a truck. In many spheres of modern development, machinery driven by unskilled labour does what skilled men had to do very laboriously fifty or more years ago; and the same can be said of many industrial developments to-day.

I will not weary your Lordships at this late hour with any further amplification of this matter, but I feel that there is needed one thing which has not, I think, been much mentioned in the debate, namely, the education of the people of the newly emerging States to be able to do what is necessary and use modern skills wisely. Here, in education, speed is more difficult. If the enthusiasm of new nations and the new and violent nationalisms spreading like bush fires across the world are to be used for the benefit of the countries themselves and not leave a trail of disaster along which Communism will quickly follow, then far more attention must be paid to training and education in the underdeveloped countries. I refer to all types of education, but especially to the education and training, through universities and technical institutions, of men and women to take on the responsibilities of government, the civil service, medicine and the law.

Illiteracy, I know, presents us with a vast field to conquer, but we must try to fight the battle. All too often we hear in this House and outside reference made to the lack of people trained to become political leaders or to run a Government Department, and, therefore, independence is not granted. But how much of the success of the self-governing States of the British Commonwealth is due to the universities which we started there? Among these are the University of Ibadan in Nigeria, with just over 1,000 students, Makerere College in East Africa, with 800 students, the University College of Rhodesia and Nyasaland, the Hong Kong University with 1,000 students, and the University College of the West Indies with 600 students. As well, there are the universities in India and the countries which we call affectionately the "old Commonwealth", where the training of men and women to take part in the most difficult of all skills, the skill required for government, takes place.

In spite of what is being done in all these universities, from the colonial countries alone 11,000 students come to Britain every year. One of the best things agreed at Montreal in September, 1958, was the establishment of 1,000 new Commonwealth scholarships, of which 500 are to be British and 250 Canadian, and at the Oxford Conference, which I think has either just started or is starting immediately, the distribution and content of these scholarships will no doubt be discussed. But I feel that in the long run and in the end the more satisfactory method is to build up universites and technical colleges in the new States themselves. I know that there is the question of staffing, and in the beginning, no doubt, many of the staffs of these new institutions would need to come from outside the countries concerned, or be nationals trained outside in the universities of the free world. But it would surely be worth while for the investment of funds, called for by the Atlantic Congress and subscribed through the World Bank, the United Nations and its agencies, and in other ways, to invest a lot of money in education, and in particular at university level, to provide the personnel to run the emergent States. In this sphere the Commonwealth countries can be proud of what has been done, particularly, as I mentioned, in West Africa; but it is not enough to develop the land and the resources of the world and to leave behind higher education as a kind of Cinderella in this development.

I would plead that there should be equal opportunities for the education of women, for the standard of development of a nation is determined as much by the education of a woman as of a man—the days of a one-sided educational development are over. The content of women's education in these new countries need not be the same, but the opportunities should be. The example of India in this matter is very striking.

My Lords, action by our Government in co-operation with the Commonwealth and the other N.A.T.O. countries would, I am sure, meet with a great response. When we read in the Press the speech by Mr. Paul Hoffmann, which I think Lord Jellicoe quoted, of the sixty nations classed as less developed, with more than 1,000 million people living in these countries, we appreciate that the magnitude of this problem is very great indeed. So I believe that if only we can increase the present development of these countries for these 1,000 million, in whatever way is considered to be the best way, even though vast sums of money are quoted and required, it would be worth while, for the emergent territories themselves will make the contributions as well as the highly-developed countries. It can be an investment and not an extravagance—an investment in health, food consumption and industrial development, in rising standards and in free nations. Poverty and misery is a good seed-bed for Communism. Rising standards of living and an educated public opinion is a stony ground for Communism.

So I hope that Her Majesty's Government will continue to support and increase their support to the United Nations agencies designed to help this development, to the World Bank and any other special fund that they may think appropriate for the job, although I agree with Lord Salter that existing monetary machinery should be studied in the first place. Time is not on our side in this particular matter; speed is essential. I hope that we shall push on with a policy that we have always advocated, and which is more necessary than ever.

8.34 p.m.

THE MARQUESS OF LANSDOWNE

My Lords, at the outset of my remarks I should like to give a warm welcome to the Motion which has been put down by my noble friend Lord Jellicoe. I think that your Lordships in all parts of this House will agree that we have had a valuable and really important debate; I am only sorry that it was not possible to hold it earlier in the day, so that we might perhaps have gone into this matter in even greater detail.

The declarations that were made at the recent Atlantic Congress, and which have inspired the Motion which the noble Earl has put down to-day, have, I think, high-lighted a subject to which Her Majesty's Government have for many years been giving close attention. As noble Lords are aware, the United Kingdom has played a leading part in promoting and supporting international techniques for assisting less developed countries throughout the world. In this we have a good record. I was interested by the observation of the noble Lord, Lord Ogmore, when he called our attention to the fact that in the Atlantic Congress, at least among N.A.T.O. Parliamentarians, this seemed to be a subject which until a short time ago received less attention.

LORD OGMORE

It received none at all.

THE MARQUESS OF LANSDOWNE

I think the noble Lord said that he threw his pebble in. Let me assure noble Lords that if that was the case among N.A.T.O. Parliamentarians, it has certainly not been the case with members of Her Majesty's Government. As was stated by my right honourable friend the Prime Minister, we in the Commonwealth believe in giving help to each other without patronage and without conditions. I think it is natural that, so far as Her Majesty's Government are concerned, this help has been directed first towards fellow-member countries of the Commonwealth which are less developed than ourselves; and it is our firm belief that this help should be given in a spirit of equal partnership.

Under Article 55 of the United Nations Charter, the industrial nations of the West have accepted a moral commitment to help nations improve their living standards. Substantial efforts have been made, both within the United Nations and by countries individually, to implement this commitment, by Government-to-Government loans, by grants and by technical assistance. Encouragement has also been given to private investment and to the expansion of trade. None the less, many of the under-developed countries—call them what you will—still have a desperate struggle even to maintain a mere subsistence. We believe that helping the under-developed countries is in the interests of world economy as a whole; but we also believe that there rests upon us a moral obligation to help them. The efforts which the United Kingdom are making are prompted solely by these considerations.

I should like to remind your Lordships of some practical steps which have been taken by Her Majesty's Government. First let us consider for a moment the field of Government investment. In this our record is second only to that of the United States, and our bilateral contributions and contributions within multilateral international arrangements have been steadily increasing. In the financial year 1957–58 the United Kingdom Government aid to under-developed countries totalled £77.8 million. In the last financial year we increased our aid by 45 per cent., to approximately £115 million. As I have said already, it is natural that the major part of our efforts has been devoted to Commonwealth countries. Many of the countries which have been helped through the Colonial Development and Welfare funds and the Colonial Development Corporation are now close to achieving independence. Her Majesty's Government will continue to give priority to those countries with which we have a special link in our Commonwealth.

The Colonial Development and Welfare funds cover just the sort of development which I think the noble Earl, Lord Jellicoe, wishes; and since 1946 we have voted over £300 million of funds for this purpose, including £95 million for the five year period ending in 1964. This is a steady and continuing source of help on which, subject to Parliament's approval, the colonial territories can rely for their development. Then there is the Colonial Development Corporation, with authorised capital of £150 million to invest, alone or alongside private enterprise, in colonial ventures, be they industrial or agricultural. There is the London market, and the colonial territories can also have recourse to Exchequer loans over the next five years up to a total of £100 million. Then there is all the money that may come from private industry making direct or indirect investment in the territories. Perhaps even more important, there is the technical assistance, the providing of know-how; and last, but certainly not least, there are the international institutions to which noble Lords have referred in the course of many speeches this afternoon. All these add up to a very considerable total of United Kingdom effort; and while I would not pretend for a moment—nor indeed, would any member of Her Majesty's Government wish to pretend—that we believe that what we are doing is sufficient, we do believe that we are making a very great effort, and a great effort in the right direction.

Much has been said about the importance of technical assistance; and naturally, through our long history of association with overseas territories and our tradition of service abroad, we in the United Kingdom have the necessary experience to render technical assistance to countries in the process of their development. This assistance usually takes the form of supplying instructors and providing, in the United Kingdom and elsewhere, training facilities for students—a matter to which my noble friend Lady Elliot of Harwood has just referred. In addition, we also provide training equipment to colleges and institutes abroad under the technical assistance programmes not only of the United Nations and the Colombo Plan, but also of the Baghdad Pact.

Within the last seven years the number of overseas students training in the United Kingdom has trebled, and it now stands at a figure, I am told, of approximately 38,000. Between 10 and 12 per cent. of all the full-time places available at the technical colleges and universities are held by overseas students, and two-thirds of these overseas students come from Commonwealth countries. A large number of these students are directly financed by Her Majesty's Government. Since 1950 Her Majesty's Government have financed 2,500 trainees from the countries of South-East Asia under the Technical Operation Scheme of the Colombo Plan. Training in the United Kingdom is being given under the Baghdad Pact and under the Mutual Technical Assistance Agreement which exists between Ghana and this country.

The United Kingdom plays an active part, as your Lordships well know, in the N.A.T.O. finishing scheme and in the N.A.T.O. pocket for the support of advanced students. It is our hope that by 1970 we shall have twice as many highly qualified scientists and technologists as we had in 1955. University places are to be increased from 90,000 to 130,000 in a ten-year period, and the output of advanced courses for technical colleges in England and Wales is to rise from 9,500 to something over 15,000. It is estimated that about 11,000 United Kingdom teachers are serving at this moment overseas. Since 1957, 550 United Kingdom experts have been employed under the United Nations expanded technical assistance programmes. Up to now the United Kingdom has provided more candidates under these programmes than any other country.

As a founder member of the Colombo Plan technical co-operation scheme, the United Kingdom gave technical assistance up to December, 1958, to the value of £3.3 million to Commonwealth countries, and nearly £900,000 to member countries outside the Commonwealth. Our annual contributions to the United Nations technical assistance and specialised agencies totals more than £2 million. Under the Baghdad Pact the United Kingdom contributes £850,000 annually, out of which £50,000 is devoted to the exchange of students between member countries and also to the provision of training facilities for them.

Even at this late hour I do not apologise for calling your Lordships' attention to these figures, for they represent, as I think your Lordships will agree, a very commendable effort on the part of our country; and an effort, as I have said, in the right direction. But I feel that I must, in honesty, issue a word of warning. We must be careful not to provide, in one way or another, more than our balance of trade and our sterling reserves will allow. If we were to lend to such a point that our reserves became low and the pound became suspect, it would do harm to all in the sterling area and to the cause of economic development. For this reason we have always, as your Lordships are well aware, to keep this in mind; and in a debate such as we have had this evening, ranging over such a wide field and where, naturally, enthusiasms have risen, I felt that perhaps there was a risk we might forget that our resources are, in fact, limited.

Naturally I have talked mostly about Government aid, but that does not mean that I in any way underestimate the importance of private aid; nor that I underestimate the importance of what can be done by individuals. A number of your Lordships have referred to this aspect in the course of this evening's debate, and I entirely agree with them. This is not a problem which can be shouldered by Governments alone; it is a problem, as I believe the noble Lord, Lord Ogmore, said, in which every facet of life and every country of the West should participate. And with that view I can assure your Lordships Her Majesty's Government are in entire agreement.

Your Lordships may think that, because I have given you these figures of our very substantial effort, there might be in the heart or the mind of Her Majesty's Government some degree of complacency. Let me assure noble Lords at once that no such thing is the case. Her Majesty's Government are fully conscious that this whole subject of under-developed countries is a subject of enormous importance and of gigantic proportions. We are constantly considering the desires and the needs of these emergent countries, and we also have to consider the risk of the misuse of their aspirations for political purposes which might be inimical to their national independence. As to the observations made by the noble Lord, Lord Grantchester, with which I am afraid I could not find myself wholly in agreement, I think perhaps he was wishing to draw attention to the dangers of a misuse of the aspirations of these emergent countries. I can assure noble Lords that Her Majesty's Government are well aware of this risk.

I have said that we in the United Kingdom believe that we have a moral duty to help under-developed countries, and that we further believe it to be in the interests of the world economy as a whole that we should do so. Now for a number of years immediately after the war the Soviet Union, under Stalin, seemed to be trying to impose its will on the world by the threat or the use of military weapons. This method was used to dominate Eastern Europe: it was also used in the Far East. Gradually, the free world organised its defences against such aggression, and in Western Europe, in particular, the strength and unity of N.A.T.O. has provided an obstacle against Communist advances which has now held for ten years. In 1952 in the Communist Party Conference, there were signs that Soviet thinking was turning towards an economic offensive to supplement, or perhaps replace, the strategic offensive which had come up against such determined resistance. But apart from an attempt to influence elections with cargoes of grain, there was not much sign of these thoughts being translated into activity. However, from about 1954 there have been increasing numbers of Communist offers of aid to carefully selected uncommitted countries. There have also been signs of increased Communist commercial activities.

In several respects aid from the Communist countries must be welcome. It is in the spirit of the present time that the "haves" should contribute and help the "have nots". This spirit has been acted upon by the countries of the free world for years, and the Soviet Government are latecomers in the field. I submit, my Lords, that we must be vigilant, and I believe it is our duty to unmask the ulterior motive—the attempt to achieve economic or political domination. I do not believe that we need fear Communist competition. Where we can do better than the Communists, we should demonstrate the fact; and where their contributions can be genuinely helpful, we should recognise it.

Nevertheless, we should not forget that in May of 1957, in an interview to a correspondent, Mr. Khrushchev said this: We think that capitalism should be destroyed not by means of war and military conflicts, but through an ideological and economic struggle. Some of the aspects of Communist aid must make us think that this statement was not purely a piece of political theory; for whereas Western assistance has been spread over no fewer than 70 nations, nine-tenths of the Russian aid is given to only six countries. This, of course, does not mean that aid from the Communist bloc is always useless or should be refused. The point is that the selection made suggests a basically political objective. Soviet aid, as we know, and as has been mentioned in speeches this afternoon, usually is offered with the label "no strings attached". But we also know that a number of countries have found this label to be very nearly a false prospectus: and we cannot forget that in 1957 Soviet aid to Yugoslavia was suddenly cut off when the policy of the Yugoslav Government did not satisfy the leaders of the Soviet Government.

So, my Lords, we have to be vigilant, and I think that it is our duty to disclose the fact when we feel that aid is being given for no other purpose than the motive of political and economic domination. As the noble Earl who moved this Motion said, we believe that the passionate belief in political independence of the emergent nations is a perfectly proper and natural thing. We also understand that their conduct of their internal affairs is a matter primarily for themselves, and if we are able to help them develop their economy that is all we should seek to do

My Lords, there is one particular recommendation which emerged through discussions in the North Atlantic Congress to which I wish to pay special attention, and that is the question of a possibility of the creation of an International Development Association. The question has often been raised—indeed, it has been raised this afternoon—whether a new international financial instrument is needed to provide economic assistance to the under-developed countries. Although it is obvious that no new institutions will of themselves produce additional capital, Her Majesty's Government are of the opinion that such a proposal as the I.D.A. is likely to be able to grant aid to underdeveloped countries on terms that are more flexible than are at present possible. We believe that the I.D.A. might possibly operate as a further affiliate of the International Bank, and that it could supplement the Bank's existing operations without duplicating all the institutional and organisational arrangements, since there could be a substantial sharing of facilities and a close relationship between the operations of the Bank and of the I.D.A.

As your Lordships know, this matter was discussed at last year's annual meeting of the International Bank in Delhi. It is expected that it will be further discussed at this year's annual meeting in Washington; and it is probable that a step forward may then be taken towards bringing the suggested association into existence. Her Majesty's Government are prepared to join in working out plans for such an association, and if acceptable plans could be worked out it would mean that the United Kingdom would contribute to the capital of the association just as it contributes to the capital of the International Bank.

It has been suggested that the capital of the I.D.A. should be of the order of 1,000 million dollars. This, I think, we shall all agree, is a minimum figure; and it is not the figure (as those of your Lordships who were listening to Lord Jellicoe's speech will be aware) which the noble Earl quoted as having been given by Sir Oliver Franks. Be that as it may, we believe that there are possibilities here. Now if the United Kingdom were to contribute to the I.D.A. on the same basis as we contribute to the International Bank, our subscription would be in the neighbourhood of £50 million—that is to say, 14 per cent. of the whole. I hope that your Lordships, even at this late hour, will consider this figure of £50 million against the background of the figures which I have already given to your Lordships. We must be realists in this business, and we must see, as I have said earlier, that we do not so overtax ourselves that, rather than being able to help, we in fact weaken our own financial position; and it is only through the strength of sterling, and it is only through the ingenuity of our traders, that we are able to make the contributions that we do.

LORD OGMORE

May I interrupt the noble Marquess? This is a very important statement that he has made, and I am very grateful indeed to him for making it. I think it ought to be widely known. And if nothing else does, I think this statement justifies Lord Jellicoe's Motion. I take it that what the noble Marquess is implying is something on the lines suggested by the noble Lord, Lord Salter. This is a considerable departure, is it not, from the original view of Her Majesty's Government? May I ask whether this Association will be able to lend and receive in soft currencies?

EARL JELLICOE

My Lords, before the noble Marquess replies, may I ask him one question on what was a very encouraging reply on this particular point? He gave the figure of a possible £50 million as being our proportional share of the subscription. That, I assume, would be on the basis of 1,000 million dollars.

THE MARQUESS OF LANSDOWNE

My Lords, I do not wish in any way to disappoint the noble Lord, Lord Ogmore. I think that if he reads what I have said in the OFFICIAL REPORT tomorrow, he will see exactly where Her Majesty's Government stand. We look upon this proposal with favour, and it will be most carefully scrutinised, but naturally I cannot this evening commit any of my colleagues to anything definite. As I have tried to explain, we are prepared to co-operate in seeing whether it is possible to work out a scheme which will be practicable. I go no further than that.

I am afraid it is possible that I may not be able to answer all the points which noble Lords have raised and indeed it may well be that your Lordships will not wish me to do so. Some noble Lords who took part in the debate have been obliged to leave. But I should like to answer one or two specific questions, and if there are others which I have forgotten I hope that noble Lords will not hesitate to ask me. The noble Earl, Lord Jellicoe, referred to the question of the co-ordination of our efforts with other European countries. I listened to that part of his speech, as I did to the whole of his speech, with great interest. As the noble Earl may well be aware, various ideas are being considered, and the noble Earl's suggestion about the possibility of using O.E.E.C. is one of the schemes that is being considered. We will certainly take note of what he has said. I think that the noble Earl made a valuable suggestion when he said that he thought that perhaps the co-operation of the countries of the Six and the countries of the Seven on aid to underdeveloped countries might help to constitute the bridge that we so much desire between these two economic organisations.

The noble Lord, Lord Ogmore, asked me about the Commonwealth Development Bank. Officials met here last week to review the availability of resources to help economic development in the Commonwealth. They reviewed the idea of a Commonwealth Development Bank. I have no doubt that in due course they will be reporting to their Governments on their conclusions, but I think the indications are that they found the difficulties no less than the Ministers found them when they were discussing this matter at Montreal. In particular, there is no certainty that the creation of a Commonwealth Development Bank could increase the funds available to the Commonwealth. But no doubt the Finance Ministers, when they meet in September, will discuss this matter further, though I think, that we may once again find that the creation of another organ does not create more wealth.

The noble Earl, Lord Jellicoe, asked where Her Majesty's Government stood in relation to the Special Fund. It is true that our subscription to the Special Fund has been of the order of one million dollars. This was for the first year of the Fund's operation. At present we are discussing what our contribution for 1960 should be. This, of course, we have to consider in the light of our other commitments. I think that there was perhaps a slight mis-statement when it was suggested that Mr. Hoffman had been unable to persuade us of the need. That, I must assure the noble Earl, is not the case. We are fully aware of the need, but we have to make calculations. I think that it is safe to tell the noble Earl that it is our hope that Her Majesty's Government will be able to make an increased contribution.

The noble Earl, Lord Bessborough, felt obliged from his experience to call attention to certain shortcomings which, he considered, existed in some of our representatives overseas. Surely an adult country like ours can afford self-criticism. I do not find it possible to agree with all that the noble Earl said, but it may be that we should be wise to consider whether our attitude is always the most suitable attitude in modern times. The reports that I have from overseas are nearly always good, but I suppose that it may be that at times, such as in the instances the noble Earl gave us, our representatives may fall below the level of events.

The noble Lord, Lord Ogmore, paid compliments to the organisers of the Atlantic Congress, and the noble Viscount, Lord Goschen, associated himself with these compliments. I should like to say, both personally and on behalf of Her Majesty's Government, how much we admired the way the Atlantic Congress was organised. I heard of the standing ovation which was given to the British contingent, a wonderful tribute of appreciation from our visitors from abroad.

I am certain that there will be a number of questions with which I have either not dealt with at all or dealt with inadequately. I am not going to attempt this evening to go into the interesting details of the methods and machinery for arranging loans, which were developed by the noble Lord, Lord Salter. These are suggestions that obviously deserve consideration and they will be given that consideration. I should simply like to say this in conclusion. I repeat our thanks to the noble Earl, Lord Jellicoe, for having moved this Motion and our gratitude to noble Lords who have taken part in this debate and made valuable contributions, all of which will be carefully considered. I sit down leaving with your Lordships this thought—that we in the United Kingdom are not ashamed of the efforts that we have made. We are not satisfied with what we have done and will certainly bend our minds and our energies to making further contributions towards a cause which has nothing whatever to do with politics, but is a moral obligation, to help those who are less fortunate than ourselves. I think that if we approach this problem only from the angle of arresting a type of government in which we do not believe, we shall be making a mistake. Naturally, we must see that aid is given unconditionally, and that is the way in which Her Majesty's Government are attempting to make their contribution to this gigantic task.

9.10 p.m.

EARL JELLICOE

My Lords, before I beg leave to withdraw the Motion I should just like to put your Lordships' minds and digestions at rest; I am not going to make my speech or those of your Lordships again. I just want to say three things. First, I should like to add my word to those which have fallen from other noble Lords in praise of the work done by the noble Lord, Lord Crathorne, and the noble Baroness, Lady Elliot of Harwood, in helping to organise and to make a success of the Atlantic Congress. Secondly, I most sincerely thank the noble Marquess, Lord Lansdowne, for his courteous, very full, considered and, to my mind at least, very positive and rather encouraging reply. It was encouraging, at least to me, because so far as the three suggestions that I put to him are concerned I think I scored three inners, or perhaps two inners and a magpie, on the target presented by the noble Marquess. Thirdly, and in conclusion, I would thank all noble Lords and the noble Baroness who have spoken in the debate. I think their speeches, together with that of the noble Marquess, have done what the Motion was intended to do, which was to focus attention on this really vital problem in our whole international relations. I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.