Lords Sitting of 27 June 1961

Preamble
The House met at half past two of the clock, The LORD CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Chairman of Committees

CHILDREN AND CRIMES OF VIOLENCE
2.35 p.m.
LORD TEVIOT: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they are aware that, owing to the admitted increase in crimes of violence, people living alone in the areas where such crimes were committed, and those who have children returning from school, are suffering from continued anxiety and fear, and whether they have formed any plans to relieve this day and night apprehension.]
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR THE HOME DEPARTMENT (EARL BATHURST): My Lords, I am most glad to be able to answer this Question of my noble friend, and I am sure your Lordships will join with me in saying how pleased we are that he has recovered from his illness and he is back in his place in your Lordships' House.
Her Majesty's Government are aware that the increase in crimes of violence gives rise to public concern. They are satisfied that the police exercise special vigilance where there is reason for particular apprehension in any area. The Commissioner of Police has informed my right honourable friend the Home Secretary that all Metropolitan police officers are on the alert to protect children as a normal part of their duty and that they give special attention to the places where children congregate; and I am advised that the police elsewhere adopt similar measures.

WORK STOPPAGES AT FYLINGDALES
EARL HOWE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they are aware of the unofficial strikes which have brought the construction of the Early Warning Station at Fylingdales Moor to a standstill, and whether any action is proposed to deal with the situation which is described as being desperately serious.]
THE FIRST LORD OF THE ADMIRALTY (LORD CARRINGTON): My Lords, the Government are aware of the labour difficulties which have arisen from time to time at Fylingdales Moor. The most recent was an unofficial strike of some 60 steel erectors which began on Monday, June 19 and ended on Wednesday, June 21. These unofficial stoppages of work are most regrettable. However, provided that there is no further undue delay, the buildings will be ready to receive their equipment when it arrives.
LORD OGMORE: My Lords, may I ask when the expected equipment will arrive?
LORD CARRINGTON: My Lords, no date has been given for the equipment because it is not in the public interest to say when this will be ready for operation.

CONTROL OF DIESEL FUMES
LORD COLWYN: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper. Before I put this Question, I must declare my interest in that I am Chairman of the Diesel Fume Abatement Society.
[The Question was as follows:
To ask Her Majesty's Government whether they will take the advice of the Diesel Fume Abatement Society in an attempt to introduce methods to abate the menace of diesel fumes on the roads of Britain, to which attention was directed at the recent Annual General Meeting of the Automobile Association.]
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF TRANSPORT (LORD CHESHAM): My Lords, my right honourable friend is always prepared to consider any proposals made to him for reducing this nuisance. Much is already being done. A regulation to control the use of the excess fuel device, often misused to obtain extra power at the expense of clouds of smoke, will be laid before your Lordships very shortly. Enforcement of the existing law is, however, the key to the problem, and the Ministry of Transport are arranging trials with smoke meters of different types to see whether a satisfactory method of roadside enforcement of the law can now be devised.
LORD COLWYN: My Lords, I thank the noble Lord very much for his Answer, but may I ask him if he will keep me informed by letter of the action Her Majesty's Government intend to take against the offenders?
LORD CHESHAM: My Lords, I shall be glad to co-operate with the noble Lord in this, and let him know whatever I can. At the same time, I should like to say that I look forward to receiving the advice referred to in his Question.
BARONESS SUMMERSKILL: My Lords, may I ask the noble Lord whether it is a commonplace to-day for the ordinary police constable, if he observes this nuisance, to take the name and address of the offender?
LORD CHESHAM: It is a little difficult for me to say to the noble Lady that it is a commonplace, but there are quite a number of prosecutions each year for the offence.
LORD MERRIVALE: Would my noble friend agree that it is not just a question of a smoky exhaust? Because even a well-maintained diesel engine will give off a high proportion of nitric oxide and nitrogen dioxide, and I am informed that nitrogen dioxide is a very strong bronchial and pharyngial irritant.
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Would he also not agree that it is a very important problem, not just from the point of view, as I said, of a smoky exhaust, but also due to the fact that a diesel engine can give up to nearly ten times as much of these oxides and nitrogen as a petrol engine?
LORD CHESHAM: If what my noble friend says boils down to the fact that diesel exhaust makes you cough and your eyes smart, then I would agree with him. I am not quite as au fait with the chemical analysis of diesel smoke as he is. From what I can learn from the work done by the Medical Research Council, it appears that diesel fumes, although unpleasant—they make you cough and your eyes smart—are considerably less toxic (if that is the correct word in this connection) than petrol fumes.
LORD MERRIVALE: My noble friend will agree, will he not, that they do contribute to chronic bronchitis.
LORD CHESHAM: My Lords, it is not a question of whether I agree; but I have no evidence at the moment that it does. At the same time, I am not in possession of any evidence that it does not. I have no evidence, and I have been informed of nothing which enables me to agree positively with my noble friend.
LORD MERRIVALE: My Lords, would my noble friend agree that there is strong medical evidence that in fact it does?
VISCOUNT BRENTFORD: My Lords, having regard to the safety aspect of the matter, can my noble friend give any indication of when he hopes to be able to introduce the new regulation to which he has referred, because the situation is one of great urgency.
LORD CHESHAM: Yes, my Lords, we are aware of the urgency of the situation. The regulation I am talking about should be laid before your Lordships' House, I understand, within the next few weeks.

LAND DRAINAGE BILL
2.44 p.m.
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—(Earl Waldegrave.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD MERTHYR in the Chair.]
Clauses 1 to 6 agreed to.
Clause 7 [Ascertainment of annual value]:
LORD HASTINGS: It will be within your Lordships' recollection that the Second Reading of this Bill met with general approval in all quarters of the House. I think that I can say that there will be few Amendments that will be found to be controversial, and many of the Government Amendments are technical. With these preliminary remarks, I come to the first Amendment, which is of a technical nature. It will enable river boards, when calculating drainage charges, to round off the apportioning of Schedule A values to the nearest pound. In doing this, the Amendment follows the precedent of the Rating and Valuation Act, 1925, and it has been suggested by the River Boards' Association.
As your Lordships know, gross Schedule A values are always expressed in pounds, and drainage charges will be leviable upon gross Schedule A values. However, under Clause 7 of this Bill apportionments of Schedule A valuations will have to be made to levy drainage charges upon hereditaments which straddle the boundaries of river boards or of internal drainage boards and in these circumstances fractions of a pound may arise. The passing of this Amendment will help river boards to keep their collection costs down to a minimum by saving time and labour and by facilitating the use of machine accounting. I beg to move.
Amendment moved—
Page 6, line 42, at end insert—
("(7) Notwithstanding anything in the foregoing provisions of this section, where the annual value of any land for the purposes of
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any drainage charge would include a fraction of a pound, the fraction shall, if greater than ten shillings, be treated as one pound and shall in any other case be disregarded.").—(Lord Hastings.)
LORD WILLIAMS OF BARNBURGH: Since the whole Bill as it now stands imposes well-nigh impossible tasks on every clerk to a drainage authority, it is pleasant to find the noble Lord trying to reduce this unnecessary volume of work that the clerks have to carry out. We have no objection to this saving of the time of the clerks to drainage boards by this simplification.
LORD HASTINGS: I am grateful to have the noble Lord's support.
On Question, Amendment agreed to.
Clause 7, as amended, agreed to.
Clauses 8 to 13 agreed to.
Clause 14 [Assessment of drainage charge on owners]:
LORD HASTINGS: The purpose of this Amendment is to require river boards to notify the owner when an occupier opts out of the arrangement whereby the owner is responsible for drainage charges in the first instance. Subsection (1) of this clause lays down that the owner will be responsible for bearing drainage charges in the first place and in due course will recover them from the tenant. This provision may conceivably jeopardise an occupier's rights of appeal against drainage charges, which he is given under Clauses 7 and 9. The clause, therefore, includes an additional provision to allow an occupier to elect to pay the drainage charge himself—that is defined in subsection (4) of the clause—and this will safeguard his rights of appeal. Of course, it would be inconvenient for the owner if no provision were made for his notification where one of his occupiers had exercised his right to pay drainage charges himself. Therefore, the Amendment put a statutory obligation on river boards to notify owners where one of their occupiers wishes to be excluded from the arrangements in Clause 14. This is really a minor Amendment in the interests of administrative efficiency and convenience. I beg to move.
Amendment moved—
Page 9, line 27, at end insert—
("() A river board shall send a copy of any notice served on them under subsection (4) of

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this section to the owner of the hereditament to which the notice relates.").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 14, as amended, agreed to.
Clause 15 agreed to.
Clause 16 [Interpretation of Part 1]:
2.50 p.m.
LORD WILLIAMS OF BARNBURGHmoved to insert in the clause:
"'agriculture' includes horticulture, fruit growing, seed growing, dairy farming, the breeding and keeping of livestock (including any creature kept for the production of food, wool, skins or fur, or for the purpose of its use in the farming of land), the use of land as grazing land, meadow land, osier land, market gardens and nursery grounds, and for woodlands".
The noble Lord said: The object of this Amendment is to clarify the scope of Clause 3 (1) of the Bill. Under Clause 3, a river board may raise a special drainage charge where it appears that the interests of agriculture require the carrying out of drainage works under a scheme to be submitted to the Minister for designating the watercourses affected. When designated the watercourses will be treated as main river for the purposes of the Land Drainage Act, 1930. Clause 16, however, contains definitions of "agricultural buildings" and "agricultural" land, the term used in Clause 1 (2) as chargeable hereditaments for the purposes of the Bill—that is, subject to the general charge and the special drainage charge. The Amendment seeks to define the "interests of agriculture" which are the criterion for imposing this very special charge. It seems desirable that the boards, when submitting a scheme and levying a charge, should not be open to challenge on the grounds that the principal use of the land to be designated is not agriculture, which is defined in the dictionary as "cultivation of the soil" but includes also such uses as forestry or fruit-growing. The Ministry suggested that the definition contained in such recent legislation as in Section 109 (3) of the Agriculture Act, 1947, or Section 17 of the Agricultural Wages Act, 1948, would apply by implication. But the omission from the Bill of these words can give rise to serious difficulties.
The wording in my Amendment is based on the definition contained in Section 19 of the Town and Country Planning Act, 1947, and Section 295 of the
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Highways Act, 1959—that is, except the omission of the qualification regarding woodlands, since it is now thought that the special drainage charge should apply to woodlands of whatever kind.
We feel that unless the definition is reasonably precise it will be criticised by agricultural interests on the grounds that the charges to be imposed on them are to finance works which might mainly benefit other interests. The River Boards Association foresee serious practical difficulties in applying the Bill to a mixed rural economy, if too narrow a meaning is given to agricultural interests. For example, the schemes dealing with localised village flooding should not be prejudiced merely because the interests benefiting are not exclusively agricultural. I hope that the noble Earl is in a position to do something about this very complex problem and will help to remove the doubts and anxieties and problems that may arise unless an Amendment of this kind is accepted. I hope therefore the noble Earl will not hesitate to accept the Amendment and clarify the situation for all concerned.
Amendment moved—
Page 10, line 16, at end insert the said words. —(Lord Williams of Barnburgh.)
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (EARL WALDEGRAVE): My Lords, I have some sympathy with what lies behind this proposed Amendment, and I have listened carefully to the arguments put forward by the noble Lord. This matter has, of course, been discussed at great length in another place, and I was interested to note that the noble Lord did not, in my recollection (I am sure he has read the proceedings in another place), advance any new argument for this proposed change which was not met very fully by the Joint Parliamentary Secretary in the other place. When this matter was debated there my right honourable friend's arguments were accepted by the noble Lord's Party as very full and complete.
Nevertheless, I would not for a moment suggest that we must rely on proceedings in another place, and as the noble Lord has seen fit to rehearse his arguments again I am afraid that I must weary your Lordships by quoting again

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the arguments put forward against the Amendment. The real point at issue here is, we feel, and we have convinced practically everybody, that it would be inappropriate to define "agriculture" in this part of the Bill by a specific definition such as that now suggested. Indeed, it is much better to leave the term undefined. Under Clause 3 river boards will have the power to levy special drainage charges, where it appears to them that the interests of agriculture require it. To provide a definition of agriculture would not help, and, by narrowing the scope of the Bill, might even hinder the boards.
The noble Lord was fair enough to say that he was speaking for the boards because they had the fear that they might be challenged, for levying a charge, on the ground that it was not primarily for agricultural benefit. But the special drainage charges will be levied over the whole of the river board's area, or very substantial parts of it. We are not concerned with defining whether or not certain hereditaments in one section of a village are agricultural: we are concerned with whether the contention of the river boards, that the proposed charge is in the interests of agriculture generally, is correct. Even if other types of property were included—as they must be when a drainage charge is levied, since the whole of a river board's area, which will not be exclusively agricultural will benefit—river boards could not be challenged so long as the property benefiting was primarily agricultural. And the river boards are much better protected legally by a wide definition than by a narrower one.
One of the effects of the Amendment would be to separate the definitions of "agriculture" and "agricultural land". I do not believe that that is at all desirable. We should thus find we have a definition of "agriculture" under Section 109 of the Agriculture Act, 1947 —which the noble Earl is not using—and another definition of "agriculture" following very closely a definition that he has found in some Planning Act. We shall be having all these multitudinous definitions of "agriculture" when we are quite clear what we mean, and we believe that the river boards also will know what is meant. I really must ask the noble Lord to reconsider whether he thinks his Amendment would be
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doing good, and whether, in the long run, it would not do harm. The very thing he wants to do is to help the administration of the Bill when it becomes law, and the convenience of the river boards, so that they would not be open to possible challenge. As the Parliamentary Secretary said in another place [OFFICIAL REPORT, Commons, Vol. 639, col. 554]:
"The sense of the word 'agriculture' … is very much wider than the narrower definition of the land which shall attract this special charge."
I cannot recommend your Lordships to accept this Amendment.
LORD WILLIAMS OF BARNBURGH: The noble Earl has not removed the doubts that already exist. As he has already said, there are definitions in the Agriculture Act, 1947, the Agricultural Wages Act, 1948, and the Town and Country Planning Act, 1947, and the Highways Act. We already have four definitions which I have discovered. None of them, however, applies to this special charge. It is something very new that is possible under Clause 3 of this Bill.
I still think that the river boards are right when they fear complications should they designate any particular area which is not wholly and exclusively agricultural land. As I said in my last words, within the area there may be a special flooding possibility in a local village. Well, it could not be thought of in terms of agricultural land, according to any one of the four definitions that have been mentioned. The river boards must see the doubts emerging in the minds of agriculturists who have to pay this special charge if they can argue that the main theme of this particular area is not exclusively to help agriculture as already defined. It is a simple thing for which we are asking, to help the river boards to prevent complaints from occupiers of agricultural land in its widest sense, otherwise we should not have put the Amendment down. It is true that I have seen some of the speeches made in another place in favour of a similar Amendment, and the replies given thereto, but they have not removed my doubts nor has the noble Earl removed them this afternoon.
EARL WALDEGRAVE: Perhaps I may say just this, as a final word. As

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I see it, if the river board desire to levy a charge merely to alleviate the flooding of non-agricultural land in a village, they would be Out of order; they are not to do that. They levy this special charge for an agricultural need. But the reverse has also to be taken into consideration; that if, in the interests of agriculture as understood by the river board, and confirmed by the Minister, they took advantage of a scheme to deal with flooding, in a village as well, they are not out of order. They could conceivably be out of order if we relied on closely defined definitions. I must ask your Lordships to resist the Amendment, and I hope that the noble Lord will not wish to pill it to the vote. I am no lawyer, but the noble Lord has been open enough to mention four definitions of "agriculture". If you go to the dictionary, there are a great many more. I should have thought that if we left this wider, for the greater to cover the less, we should be in a better position and less likely to get into tendentious litigation than if we tried to put yet another definition of "agriculture" into the Bill.
VISCOUNT ALEXANDER OF HILLSBOROUGH: I do not think we shall want to divide on this Amendment; we do not wish to be unreasonable. But as I listened to my noble friend, I felt that what was in his mind was that this is going to be an important Statute and it will be largely self-contained. The actual provisions of the Statute ought to be clearly connected in the minds of farmers and others in the particular area in which they live, so that they can in the one document get the information on which they wish to make up their minds whether they want to appeal or not. This goes from village to village and is sometimes very widespread. Surely it is not unreasonable that a Statute should be as free as possible from imposing on the citizens of the country the need to employ lawyers to see how legislation by reference has to be used. The common people and the farmers in industry are liable to taxation of this kind, obviously for a good purpose; nevertheless, if they have any grievance about it, it is not at all a bad thing to have these Statutes complete, so that in these days of growing education they may themselves be able to
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understand whether they are being fairly treated or not.
On Question, Amendment negatived.
Clauses 16 and 17 agreed to.
Clause 18 [Performance by river board of functions of internal drainage board]:
3.6 p.m.
LORD BURDENmoved to add to the clause:

"(6) (a) The Minister shall by regulations provide for the payment by a river board subject to such exceptions or conditions as may be specified in the regulations, of compensation to any officer or servant of that board who suffers loss of employment or loss or diminution of emoluments which is attributable to an order made under subsection (2) of this section or anything done in pursuance of any such order.

(b) Different regulations may be made under this subsection in relation to different classes of persons.

(c) Regulations made under this subsection may include provision as to the manner in which and the persons to whom any claim for compensation by virtue of this subsection is to be made, and for the determination of all questions arising under the regulations.

(d) Regulations made under this subsection shall be made by statutory instrument and shall be subject to annulment in pursuance of a resolution of either House of Parliament."

The noble Lord said: Your Lordships will see that this Amendment seeks to provide compensation to any officer or servant of a river board who suffers loss of employment or loss or diminution of emoluments as a result of the administrative provisions of this Bill. I feel sure it is not necessary for me to attempt to argue the case for compensation in such circumstances, because the principle is well established—in fact, the Land Drainage Act, 1930, which I will mention a little later, contains compensation provisions. Subsection (1) of Clause 18 of the present Bill provides for river boards to perform the functions of internal drainage boards. Subsection (2) of the same clause provides that where, by virtue of subsection (1) of the clause, or an order made under Section 11 of the Land Drainage Act, 1930, a river board is in fact the drainage board of an internal drainage district, and a petition for constituting a separate drainage board for that district is made to the river board by a sufficient number of qualified persons or by a qualified authority, the Minister of Agriculture, Fisheries and Food is empowered by

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order to constitute an internal drainage board for that district. The property and liabilities of the river board concerned, so far as they relate to the river board in its capacity as a drainage board for that district, would be transferred to the new internal drainage board. That is the kernel of the case.
Subsection (3) of Clause 18 provides that the provisions of the Land Drainage Act, 1930, are to apply in relation to subsection (2) of the clause as they apply in relation to an order under Section 11 of that Act. And Section 11 empowers the Minister by order to transfer to a catchment board (now a river board) the powers, duties, obligations, and so on, of the internal drainage board of any internal drainage district.
Section 67 of the Act makes provision for the compensation of officers of drainage boards. Every officer of a drainage board who before the commencement of the Act has held office under that board for not less than two years, and who by virtue of the Act or of anything done in pursuance or in consequence of it, suffers any direct pecuniary loss by abolition of office, is entitled to compensation under the Act for that loss. But Section 67 of the 1930 Act applies only to officers of drainage boards who immediately before the commencement of the Act held office under the board in question for at least two years. That being the case, the provisions of that section would not have effect in relation to orders under subsection (2) of Clause 18 without modification. It is that modification that my Amendment seeks to effect.
In these circumstances, on behalf of the National and Local Government Officers' Association, the Ministry of Agriculture, Fisheries and Food was approached in regard to compensation provisions. But I understand that the view of the Ministry is that it is so unlikely that any officer of a river board will suffer detriment by reason of that board losing its internal drainage board functions, that it is not proposed to make provision for compensation. That, I understand, is the case which the Ministry has put up. With respect, I suggest that, if this view is correct, no harm will be done by including compensation provisions. On the other hand, should it unfortunately prove to be incorrect, then I feel sure that the Minister will
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agree that the right thing has been done by including this Amendment in the Bill. In those circumstances, I would strongly urge the Minister to accept this Amendment. I beg to move.
Amendment moved—
Page 11, line 21, at end insert the said subsection.—(Lord Burden.)
LORD HASTINGS: I am sure the Committee will agree that the noble Lord has moved his Amendment in a very persuasive manner, and certainly we appreciate his concern for the future of the officers who may possibly be affected by this clause in the Bill; members, presumably, of the National and Local Government Officers' Association. The setting up of a separate drainage board may be effected possibly by virtue of a petition made by qualified persons to a river board which is itself performing the functions of an internal drainage board at the time. As I have said, we are certainly appreciative of the noble Lord's concern. On the other hand, we think that the circumstances about which he has expressed fears will not, in fact, arise.
I was going to say that it might help to explain the position in detail, but in point of fact the noble Lord has done that very clearly himself. It is true that, under the Land Drainage Act, 1930, the Minister may, on a petition from a catchment board (and since 1948 from a river board) make an order which will enable the river board to take control of the internal drainage board. That could already be done before the proposals contained in the present Bill. The result would be, and has been, that the river board would have, and in some cases has, a dual rôle, first as a river board and also as an internal drainage board. But the Act of 1930 and the River Boards Act, 1948, provided for compensation to existing officers for abolition of office. As the noble Lord has pointed out, the 1930 Act limited that compensation to those officers who had already held office for not less than two years at the commencement of that Act—in other words, since 1928. On the other hand, of course, the 1948 Act did not deal with internal river boards at all. It was concerned purely with river boards and catchment areas and their connection with local authorities.
Neither the 1930 Act nor the 1948 Act made any provision for compensation for

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loss of office which may arise when changes are made in the administration of internal drainage districts. The difficulty which the noble Lord foresees arises because we are providing, in Clause 18, that where a petition by a body of drainage ratepayers or a qualified local authority is successful, an internal drainage board, under the control of a river board, should be re-established as a separate body. It has been argued that where this happens the people doing the internal drainage board work on the river board will lose their jobs. But it is the Government's view that this is almost a theoretical worry—a hypothetical situation. First of all, the number of petitions likely to be made will be very small; secondly, it is unlikely that anybody would lose his job as a result of a relatively small reorganisation of a river board's work arising from a successful petition. It should be remembered that, while the drainage board's work will no longer be carried out by the river board, the job as such will still exist, and it is possible that more jobs are likely to be created. Very often—in fact, I think, usually—in the process of devolution and decentralisation there are more jobs. When you centralise there are fewer jobs. If any were displaced from a river board, I am sure they would be the first candidates for the new internal drainage board posts.
Apart from these points, I have to point out and make clear that there is no provision for the payment of compensation to officers where a river board decided to re-establish one of the drainage boards which it controlled and does this on its own initiative without a petition, or where an independent drainage board was taken over by a river board. That is the existing position which is not affected by anything in this Bill, and there is no compensation laid down for those cases. Therefore, it would seem hardly reasonable to provide for the payment of compensation in this isolated example, which we believe may never occur, and which would, in fact, put a few officers in a better or more favourable position than most of their colleagues are at this moment. In view of that explanation, I hope the noble Lord will think that there is no point in pressing this Amendment, and that he will see his way to withdrawing it.
LORD BURDEN: I am very sorry, but I am not convinced by the reply. Nobody can foresee what will happen in the future. The reply of the Minister simply ignores the fact that, by administrative changes arising out of this Bill when it becomes an Act, some persons may lose their posts. That, I think, is a possibility. The Minister thinks that it is highly improbable, but, with due respect, it is the Minister's opinion against that of the responsible people who would know. The point which the Minister has ignored is this. Time after time, when Parliament is authorising administrative changes which result in a person's losing a post or emoluments, it is always the case that, either in the Bill or by taking powers by regulation, compensation is provided for. That is the kernel of the case: that normally when administrative changes are brought about as a result of a Bill compensation provisions are always included. In those circumstances, as the Minister is ignoring that fact, I am with regret unable to see my way to withdraw my Amendment.
LORD HASTINGS: I listened very carefully to what the noble Lord said, but we feel that it would be making a favoured class of officers if we accepted this Amendment. What the noble Lord is really asking is not to amend this Bill, but to amend the Land Drainage Act, 1930. We feel we cannot agree to accept this Amendment for the reasons I have put forward, and I am afraid I must ask the House to reject it.
EARL ATTLEE: May I ask the noble Lord whether the reason for not accepting this is that the noble Lord thinks it unlikely to occur?
EARL WALDEGRAVE: That is not the only reason, as my noble friend tried to explain. That would not be a full and sufficient reason. The reason is that if we gave this small section of the officers this preferential treatment it would be grossly inequitable if we did not carry the same kind of compensation terms right through all the land drainage legislation. It may be desirable for us to do that, but I am not sure whether the noble Lord is aware what would flow from this. I cannot accept this Amendment now to this Bill without saying that I would come back to Parliament at some other date and change all the other Land Drainage and River Board

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Acts as well, so that everybody would be equally looked after. It is that point really which would seem to me to make it extremely undesirable to pick out this small class of men and put them in a more favourable position than their fellows.
EARL ATTLEE: The argument there would seem to be that it would be too dangerous to redress a possible injustice here because you would have to redress other injustices.
EARL WALDEGRAVE: Of course I would not use that argument. I do not think there is an injustice, and I think the fact that these arrangement in the other drainage legislation (the River Boards Act, and so on) have not been questioned and have not led to injustice means that they are correct ones. If you make special arrangements for this small class of persons then you are throwing all these other arrangements into doubt. We have not had any discussion here or elsewhere as to the merits of the case that all through the drainage legislation injustice is being done. I would say there is not.
VISCOUNT ALEXANDER OF HILLSBOROUGH: Is it not apparent that my noble friend Lord Burden has been putting up this very case in regard to status because he has obviously been asked to do so by the people who are concerned and who understand what it is they want? Of course, what we have not had explained is what are the preferential terms which are asked for by these particular people. What is the preference, in substance? It may be a preferential procedure by which, under this Bill, the statutory authority pay compensation, and you want to rely upon something else; but what in fact are the preferential terms asked for and granted? Nothing at all. This is merely the power for them to be able to look after their own interests.
LORD SILKIN: I think that the noble Earl ought at least to have undertaken to have this point examined. My noble friend Lord Burden has brought forward a possible injustice and hardship to an admittedly limited number of people. The noble Lord who replied did not say it could not happen that people would be dismissed from their jobs because of reorganisation; he said it is not likely to
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happen and if it did it would apply to very few people. Let us accept that the injustice would apply to a very limited number of people. Then he says that if we are to remedy that injustice there are possibly a lot of other injustices that we might have to look at. So what? We are not out to perpetuate injustice. If the repercussions of this is that there is another set of injustices to look at, let us look at them. I would suggest that he looks at this matter again and sees whether he cannot do something at the next stage of the Bill in respect of my noble friend's Amendment.
EARL WALDEGRAVE: I certainly will look at this again but may I beg noble Lords opposite also to look at it again; no doubt they will before they come back. We have really got a little off beam here in suggesting there is any injustice. It has not been argued that there is injustice, but a certain treatment is asked for for officers of this Association who might become redundant if a drainage district is formed by one particular procedure, by this petitioning procedure. There are other methods in which a drainage board might become set up, not by this particular procedure under Clause 18. I am not going to use the argument but I am sure that it could be used that clearly this Amendment is not right as it stands. If we are going to say, every time a drainage board is formed, that we must introduce a new system of compensation, then it is creating a much wider problem.
I say there is no demand for, and nobody has asked for, a system of compensation quite different from what is existing in the Act and other methods; and therefore to give a specific form of compensation to this particular section would be anomalous and irrational. It is not a question of giving them justice and other people injustice; it would be anomalous and irrational. As this is a point my noble friend and I have not been able to make clear to your Lordships I will take it back, look at it again, study in Hansard the arguments used by the noble Lord, Lord Burden, and others, and come back to it in the Report stage. I hope your Lordships will not think I have been unduly stubborn about it, but I cannot give way at the moment.
LORD BURDEN: In view of that assurance I think my noble Leader would

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agree that it would be wise for me at the moment to withdraw this Amendment so that it can be put forward again on the Report stage. May I again urge on the Minister this point: that we are asking him at the moment only to deal with a possible situation which will arise out of this legislation. In regard to those other instances to which the Minister referred, let us say that the river board itself, with the time having elapsed and all this sort of thing, forms an internal drainage board of its own initiative. We are not asking the noble Earl to deal with that point at all. All that we say to him is that he can leave the men concerned to look after their own interests. But when one by an Act of Parliament provides for a certain method which may lead to injustice or may lead to loss of office, then it is right for Parliament to provide for compensation. In these circumstances I beg to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 18 agreed to.
Clauses 19 to 22 agreed to.
Clause 23:
Drainage rates—determination of relative poundage
23.—
(3) The relative fraction shall be arrived at by dividing—
(b) the aggregate of the rateable values of those hereditaments.
(4) For the purposes of this section—
(a) the rateable value of any hereditament shall be taken to be the value which, at the date on, which the drainage rate is made, is shown as its rateable value in the valuation list in force for the period for which the drainage rate is made:
(b) the annual value of any hereditament shall be taken to be its annual value as last stated before the said date in any assessment under Schedule A signed and allowed under section thirty-five of the Income Tax Act, 1952, or under that section as applied by the Fifth Schedule to that Act (apportioned where the hereditament forms part only of any land assessed under Schedule A).

3.29 p.m.
LORD WILLIAMS OF BARNBURGHmoved to omit all words in subsection (3) after "shall be", and the whole of subsection (4); and to insert instead:
952
"such fraction as may for the time being be prescribed by the Minister by regulations made by the Minister under section seventy, four of the Act of 1930."
The noble Lord said: With the best will in the world, I doubt whether it is possible either for me or anyone else to explain all the complications and difficulties that would confront clerks to internal drainage boards if Clause 23 passed without this Amendment. Under the Land Drainage Act, 1930, drainage rates are based upon gross annual values for Schedule A purposes. In that Act Section 24 (4) (b), on all hereditaments, not comprising agricultural land only, one-third of the full rate burden was imposed. Because of the anomalies in Schedule A values, largely due to the last quinquennial revaluation taking place in 1935–36, Clause 22 of the Bill substitutes rateable values where available for all drainage rates levied after March, 1963. I understand that this principle is generally accepted by the drainage authorities. Subsection (4) of Clause 22 continues a reduction of one-third imposed by the 1930 Act, but a further financial adjustment becomes necessary to allow for the different standards of values between rateable values in 1963 and annual values in 1936. Clause 23 of this Bill is designed to provide the machinery for this second financial adjustment. I ask noble Lords to read this clause carefully and tax their imagination to find anything more clumsy. I doubt if they will succeed.
Before any internal drainage board can compute the relative fraction under the machinery provided, they must obtain the new rateable values for their district and compare them with the annual values and divide one by the other. Very few of the 361 internal drainage boards have the same boundaries as those of the local rating authorities. Numerous farms will be situated within, or partly within, both separate drainage districts and separate rating authorities. Under Clause 23, which operates after March, 1963, valuation lists will have to be rewritten and volumes of other unnecessary work will have to be done. Having read some of the comments of clerks of internal drainage boards, I can understand their indignation and hostility against the clause as it now stands. Instead of each internal drainage board working out its

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own relative fraction, in many cases in duplicate because of the spread over of hereditaments into two rating or drainage authorities, it is thought—and I think it is right to think so—that the Minister should provide a simple fraction to be applied throughout the country: that is, applied to the one-third to be charged to non-agricultural hereditaments. That is the simple object of this Amendment. I hope the noble Earl is going to accept it. If, however, he tells your Lordships that nothing that did not happen in another place can possibly happen in this place, I begin to wonder what the utility value of this place really is. I am greatly concerned for the noble Earl's future, for if he persists in resisting this Amendment as he has done the two previous ones I am sure he will incur the displeasure for all time of every clerk to an internal drainage board in this country. For his own sake, therefore, I hope he will accept this Amendment. I beg to move.
Amendment moved—
Page 14, line 37, leave out from ("be") to the end of line 8 on page 15 and insert the said new words.—(Lord Williams of Barnburgh.)
EARL WALDEGRAVE: The Amendment could not have been more charmingly moved by the noble Lord opposite, and I do not take his last remarks as a threat or any form of blackmail as I know they were not intended to be. But I have often heard it said in your Lordships' House and elsewhere that it is a very bad principle indeed to allow facility of administration to thwart justice or to thwart the proper following out of the procedure. I am fully aware that the drainage boards will have a lot of work to do, but we really must not fall into the trap of saying that because their task is difficult or onerous we must simplify it to the extent that we spoil the very thing that we are trying to get at, as I will try to show in a moment. I was asked by the noble Lord, Lord Williams of Barnburgh, that the Minisster should apply a simple fraction. Let us just see what we are doing in Clauses 22 and 23. The whole point of those clauses is to make the individual variations calculated from district to district. If we go and make a simple fraction to apply to the whole country we are really spoiling the whole principle that these clauses were designed to incorporate.
LORD WILLIAMS OF BARNBURGH: But surely the noble Earl will not forget that all this Amendment deals with, and in fact all that Clauses 22 and 23 deal with, is the fraction of one-third which applies to non-agricultural hereditaments. The only uniformity we ask for is one uniform fraction to apply over the whole range.
EARL WALDEGRAVE: If the noble Lord will be patient with me I will try to explain why it is not quite so simple as that. I think I must go back to what these clauses are trying to do. Among other matters, where the property is included in a local valuation list for local rating purposes drainage rates will be levied from the date of the operation of these clauses on one-third of the rateable value in the valuation list instead of one-third of the Schedule A value. Clause 23 provides for adjustments of poundage relating to the hereditaments valued for drainage rates in this way. Because the yield of any given poundage of rateable values is higher than the yield from Schedule A values we have to adjust the poundage where rateable values are used to preserve the existing incidence of drainage rates. That is what we are under an obligation to do. To obtain the poundage by which it is to be adjusted the drainage board will compare the total of the net annual values shown in the valuation lists with the total of the Schedule A values of the hereditaments. The resulting fraction will be applied to the poundage paid on rateable values, thus bringing this yield into line with that paid on Schedule A values formerly used.
Perhaps I might give an example. For instance, in a particular drainage district the total rateable values of properties on the valuation list might be £70,000; the total Schedule A values of those properties might be £30,000. The fraction to be applied then to the poundage of the drainage rate where it is charged upon the basis of rateable values would be three-sevenths. We provide that a separate fraction will be determined by drainage boards for each drainage district. In this way any variation in the values over the whole country will be taken account of. Clauses 22 and 23 were introduced in another place to overcome some quite serious

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anomalies, and they therefore will provide that where the property has a rateable value in a local valuation list the drainage rates will be levied upon that basis, and not, as at present, upon the Schedule A valuations.
This Amendment, as I understand it, is intended to provide for a national fraction for preserving the incidence of drainage rates between agricultural and rateable properties. Of course this would be simple—I do not doubt that for a moment. But there are great variations over the country, in the relationship between Schedule A and rateable values. If a national fraction were to be applied the incidence of the drainage rates on different kinds of property would vary as a direct result of this clause, and we should have the unfortunate result that in meeting one anomaly we should be creating another.
I am well aware that this is going to mean more work for the drainage boards. I am sorry for that, On the other hand, we must not overestimate that, and I think that we should be failing in our duty if, in order to let the drainage boards and the river boards off a little work, or even a lot of work (I am sorry for that, and I quite see their view) we should jeopardise the principle that is behind this scheme, that we should deal with the incidence of this charge as it exists at the moment with this new variation using rateable and Schedule A values.
VISCOUNT ALEXANDER OF HILLSBOROUGH: I must say that the noble Earl has done his level best to explain why he is so adamant upon this Amendment; but I am quite sure that I, at any rate—I suppose being a little slow on the uptake—do not understand how it will work in my own district. After all, we have not put down this Amendment for fun; we have put it down at the request of the Association of River Boards. Obviously, they must see a difficulty. Taking the case of the place where I have a farm, and where I have a direct passing interest in the formula that has been talked about, we have an island where three-quarters, or more than three quarters, of the population are living in an urban district, and the rest of the population, less than one-quarter of the whole of the island, are living in a rural district. They will not come in because
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they do not want to pay the urban district rate. They have kept well out of the island and live in a rural district. So local feeling does arise about this sometimes. I put that forward only 'by way of illustration.
There is one principle in this Bill that everybody is in favour of—namely, that the main result will be a fairer distribution amongst the population at large of payments towards what is likely to be of general benefit to the country as a whole, and in particular to the agricultural industry. Therefore, it seems to me that when you come down to the difficulties of the river boards, which are admitted by the noble Earl, and the extra work involved, by a kind of process which the noble Earl envisages, then I should have thought that we might have had more consideration given to the proposal of my noble friend Lord Williams of Barn-burgh, especially when the proposal comes forward as a result of the views of the river boards.
Therefore I should like to ask whether the Ministry have been in consultation with the river boards on this particular issue. Have they discussed it with them? Apparently the noble Earl, or his Department, seems to have been moved on other matters, such as in the Amendment we have already adopted in Clause 14, and an Amendment which the noble Earl has down to Clause 23, as Amendment No. 6, to give a measure of relief. Here are the same reasons given by the river boards for adopting this particular Amendment. But apparently the clemency of the Minister in regard to the Amendments which have been, and are to be, adopted in Clause 14 and the Amendment No. 6, is not to be exercised in the other direction. I find that to be completely inconsistent. It may be that the basis upon which you are trying to get a formula is somewhat different, but the spirit and principle is there all the same. Therefore I think that you had better have another look at this one. If you are not going to have another look at it, then perhaps the best way is to decide by going to a Division.
EARL WALDEGRAVE: I hope that the noble Viscount who leads the Opposition will not divide the Committee on this point. Here the principles are quite different. I have agreed to consider the

957
Amendment moved by the noble Lord, Lord Burden, on his argument which at the moment I cannot accept and do not believe, though I certainly feel that it should be examined. The burden of his Amendment is that an injustice would or might be done. That is a serious matter, and I agreed that we should take this back and look at it to see whether, by any chance, the noble Lord was right; because no Government wants to perpetuate an injustice. But this Amendment deals with a very different matter.
The noble Viscount has been most open and frank in saying that this is a case of the Internal Drainage Boards coming to certain Members of your Lordships' House and saying: "we are going to have to do a lot of work. Cannot you get us off some of this work, even if it makes the Bill less just than it should be?" The Government have said that the incidence of these drainage rates under the new arrangements will be the
Clause 23 agreed to.
3.55 p.m.
LORD HASTINGSmoved, after Clause 23 to insert the following new clause:
958
same as it was before. Then the Drainage Boards would say, "It will not be quite the same incidence, but what a lot of work it will save us!" I maintain that those are two totally different matters, and at the present moment I have heard no argument except that this would save the Drainage Boards and river boards work. I admit that they are admirable bodies. I myself was a vice-president of their Association until I took office in the Government and, naturally had to resign. But it is not a good argument that I should be asked to spoil the Bill because somebody thinks it is going to be rather difficult to administer it. That is putting administration in a place where it ought not to be. Therefore, I ask your Lordships to reject this Amendment.
On Question, Whether the said Amendment shall be agreed to?
Their Lordships divided: Contents, 29; Not-Contents, 57.

CONTENTS

Albemarle, E.

Lawson, L.

Silkin, L.

Alexander of Hillsborough, V.

Listowel, E.

Sinha, L.

Amulree, L.

Lucan, E. [Teller.]

Stonham, L.

Amwell, L.

Macdonald of Gwaenysgor, L.

Summerskill, B.

Attlee, E.

Macpherson of Drumochter, L.

Taylor, L.

Burden, L. [Teller.]

Meston, L.

Walston, L.

Colwyn, L.

Morrison of Lambeth, L.

Williams, L.

Crook, L.

Ogmore, L.

Williams of Barnburgh, L.

Hall, V.

Pethick-Lawrence, L.

Wise, L.

Henderson, L,

Piercy, L.

NOT-CONTENTS

Ailwyn, L.

Exeter, M.

Margesson, V.

Amherst of Hackney, L.

Fortescue, E.

Merrivale, L.

Ampthill, L.

Fraser of North Cape, L.

Mills, L.

Auckland, L.

Freyberg, L.

Milverton, L.

Baden-Powell, L.

Goschen, V.

Molson, L.

Bathurst, E.

Gosford, E.

Montgomery of Alamein, V.

Birdwood, L.

Grenfell, L.

Munster, E.

Bossom, L.

Hampton, L.

Newall, L.

Boston, L.

Hastings, L.

Newton, L. [Teller.]

Brentford, V.

Hawke, L.

Northesk, E.

Buckinghamshire, E.

Horsbrugh, B.

Perth, E.

Conesford, L.

Jellicoe, E.

St. Aldwyn, E. [Teller]

Cottesloe, L.

Jessel, L.

St. Oswald, L.

Crathorne, L.

Killearn, L.

Soulbury, V.

De La Warr, E.

Kinnaird, L.

Templemore, L.

Denham, L.

Lambert, V.

Teviot, L.

Derwent, L.

Long, V.

Torrington, V.

Digby, L.

Luke, L.

Waldegrave, E.

Effingham, E.

McCorquodale of Newton, L.

Westwood, L.

Resolved in the negative, and Amendment disagreed to accordingly.

Drainage rates—fraction of a pound
". Where the value on which a drainage rate is assessed would, apart from this section, include a fraction of a pound, the fraction shall, if greater than ten shillings, be treated as one pound and shall in any other case be disregarded."
The noble Lord said: I do not believe there will be any great difficulty about this Amendment. It is a purely technical clause which the Government are introducing to meet the wishes of the River Boards Association and the Association of Municipal Corporations. I have already explained the reasons underlying the previous Amendment to Clause 7 enabling the river boards to round off, upwards or downwards, fractions of a pound of apportioned gross Schedule A valuations for drainage charges, and this new clause has a similar purpose in relation to drainage rates. It provides that both the river boards and, in this case, internal drainage boards, when calculating drainage rates, shall be able to round off valuations to the nearest pound. It will help the boards in levying their rates under existing legislation upon the basis of apportionments of gross Schedule A valuations or, as in the case of urban property, where drainage rates are levied on one-third of the Schedule A valuations. This new clause also follows a precedent established in the Rating and Valuation Act, 1925. I beg to move.
Amendment moved—
After Clause 23, insert the said new clause. —(Lord Hastings.)
LORD WILLIAMS OF BARNBURGH: I think we can compliment the noble Lord for having made at least one tiny concession. We agree with him, but only on this occasion.
On Question, Amendment agreed to.
Clauses 24 to 29 agreed to.
Clause 30:
Restriction on erection of structures in, over or under watercourses
(2) No person shall erect any structure [in, over or under a watercourse which is part of the main river] except with the consent of and in accordance with plans and sections approved of by the river board; and no person shall, without the consent of the river board, carry out any work of alteration or repair on any structure in, over or under such a watercourse if the work is likely to affect the flow of water in the watercourse or to impede any drainage work.
LORD WILLIAMS OF BARNBURGHmoved, in subsection (2) to omit all words from the first "structure" down to "except" and to insert "to which this section applies".
The noble Lord said: As the noble Earl will appreciate, these next three Amendments plus one later will hang together—and they are likely to hang separately, too. Of course, one discussion will do for all four. The point at issue in this Amendment is of some importance. I think perhaps I can give the Committee some idea of the importance by quoting a few words from a letter written by the right honourable gentleman the Minister of Agriculture, Fisheries and Food, to one of his own colleagues. He says, referring to this particular point:
"I do appreciate the seriousness of the problem with which river boards can be faced when building or other development takes place on land liable to flooding",
and so forth. The Minister fully appreciates the difficulties facing the river boards in those circumstances.
This point was raised at every stage of the Bill in another place by Members of all Parties. It was no Party matter; it was a question of what is best in the national interest. It was raised on Second Reading, on Committee, on Report and, indeed, on Third Reading. But although the Minister himself appreciated the strength of the river boards' case, he has persisted throughout in relying upon voluntary consultation between planning authorities and river boards, despite the fact that the right honourable gentleman admits that some planning authorities have failed to consult river boards—with very unfortunate results, too.
For the benefit of noble Lords who have not followed these discussions very closely in another place, I cannot do better than quote a circular letter sent to local planning authorities, county councils and joint town and planning committees from the Ministry of Town and Country Planning in 1947. It is rather a long quotation, but I must read it if noble Lords are going to be able to appreciate the force of the argument.
"Liaison between planning authorities and land drainage authorities: I am directed by the Minister of Town and Country Planning to draw your attention to the importance of maintaining the closest liaison with local drainage authorities, not only from the point of view of land drainage but also in the interests of planning itself. In certain cases, for reasons not readily apparent, development in lowland areas or near water-courses may lead flooding, which may cause much

961
damage to property and be costly and difficult to remedy. On the other hand, drainage authorities may have plans for improvements in drainage, including the provision of new cuts or by-pass channels, which would be seriously prejudiced by development. A note for the guidance of planning authorities is attached setting out ways in which development may affect drainage. It will be apparent that there are many points on which drainage and planning authorities can help each other in formulating their plans for future works, and that there is a need for a regular exchange of information between the two sets of authorities. The Minister is anxious, therefore, that planning authorities should at an early stage consult the local drainage authorities in order to find out in which parts of their area development is likely to raise problems of drainage, and to work out an effective system of liaison in such cases".
That was the importance attached to consultation by the Minister of Town and Country Planning in 1947. A similar circular was also sent out in 1951, pleading with planning authorities to consult voluntarily with river boards so as to avoid future problems and, in some cases, future disasters.
That circular definitely underlines the importance of full and adequate consultation between planning authorities and river boards. It is true that quite a large number of planning authorities do consult, and have consulted river boards from 1947, but noble Lords may be surprised to learn that some 30 or 40 per cent. of the planning authorities have never consulted river boards at all, with unfortunate consequences in many cases. When floods have occurred in some areas and damage has been caused, the river boards have been blamed for not having taken protective action, when in fact they never knew that the development was going to take place and they never had the power to take protective action at all. Therefore, with fourteen years' experience behind them, all the river boards ask is that there should be a statutory obligation on planning authorities to consult river boards when development is contemplated beside main rivers or in what they call the flood plain. Surely, that is not only common sense, but ought really to be good business, too: and that is the object of these four Amendments.
The Minister has suggested in another place that the River Boards Association is asking for powers that would usurp some of the functions of planning authorities. Certainly that is not my desire—and, in fact, I do not think that
962
that would be the outcome of obligatory consultation. In any case, any dispute between a planning authority and a river board would be ultimately settled by the Minister of Agriculture, Fisheries and Food and the Minister of Transport jointly. So I do not quite see how the acceptance of this Amendment would give river boards power to take over the functions of a planning authority. Indeed, as I understand the mentality of the river boards, all they desire—and it is their only object—is to ensure that planning authorities have proper regard for land drainage considerations where development is proposed in the flood plains of rivers.
The Minister also suggested in another place that to place a statutory obligation on planning authorities to consult river boards would cause practical difficulties and further complications to planning procedure, and might tend to cause delays in decision. Why should this be? Section 9 of the Town and Country Planning (General Development) Order, 1950, contains provisions for statutory consultation with other bodies, and, so far as we know, those powers have given rise to no difficulties at all. In any case, the Minister tells us that he is anxious that there should be full and adequate consultation. Indeed, he goes so far as to tell us that he and some other Minister are promising a strongly worded circular to planning authorities, signed by those two Ministers, insisting that planning authorities do actually consult with the river boards. He says that he wants to give voluntary action a fair trial. Well, they have had fourteen years of trial. It has been trial and error—more errors than trial. And still in this Bill, if unamended, there is going to be no guarantee that that 30 or 40 per cent. of the planning authorities which I mentioned will consult river boards. Moreover, will voluntary consultation cause fewer difficulties and delays than a statutory obligation to consult? I should have thought that the opposite would have been the case: that a statutory obligation to consult would speed up consultation, and remove cause for delays and the danger of more mistakes.
Then there is the question of designating flood plains as part of the main river. I fail to see how this can be construed as usurping the powers of

963
the planning authority. Nor do I see how a river board can exercise proper control over the flood plains unless they arc designated. I am sure the noble Earl will agree that only a river board can exercise full control, for they alone know the conditions obtaining throughout the whole length of a river's course. Even when full co-operation has been given between planning authorities and river boards, there are still plenty of problems for those who wish to drain the all too few agricultural acres in this country. One need mention only the 22 classes of permitted development for which no planning permission is required. I shall not deal with them in detail, but I think that perhaps I ought to give your Lordships an example of what can happen even where consultation takes place, in one of the 22 classes of case that I have referred to.
Here is a letter from the Kent River Board to a Member in another place:
"Further to my letter of 19th June, the following are two recent examples from this area of the obstruction of flood plains.

(1) Tonbridge. Tipping has been undertaken (mainly by the local authority) on land alongside the Botany Stream and the Gas Works Stream, two by-channels of the River Medway at Tonbridge. The land is part of the natural flood plain, and the work has reached a stage where further tipping will raise flood levels to a serious extent. The Board are therefore having to undertake an improvement scheme on the two streams.

"(2) Newenden. The valley of the Hexden Channel, a tributary of the River Rother, is subject to frequent and widespread flooding. No improvement can be achieved in these conditions except by the undertaking of an extensive and costly scheme designed to lower flood levels in the length of the Rother into which the Hexden Channel discharges.

"In present conditions land in the valley is suitable only for grazing, except in so far as any individual farmer is prepared to carry out special measures for improving the drainage of his land and protecting it from flooding. One farmer has carried out such a scheme involving the pumping of water from his lands into the Hexden Channel, and the making of an embankment across the flood plain alongside an important public road that traverses the flood plain."
Now, this is the point:
"This embankment obstructs the passage of flood waters down the valley, with the result that, whereas the road used to flood only to a depth of an inch or two, it now floods to such a depth as to be impassable to vehicles. That is the kind of thing which can happen where no consultation takes place. It is
964
annoying, and it can be excessively costly to the River Board or to those responsible."
I shall not deal with the twenty-two items in detail. Indeed, I know the noble Earl knows them all too well for me to do that. Therefore, my submission is that the river boards have a good case, not only for asking for the flood plains to be designated on the lines that the main rivers were designated under Section 6 of the 1948 Act, but also for a statutory obligation for consultation between the two bodies. I hope that the noble Earl—whatever may have happened, or failed to happen, in another place—will feel that there is a good case here. There are no politics in it at all. It is what is the best for the country as a whole; what is the best for the planning authority in the long term; and what is the best for the river board. I beg to move.
Amendment moved—
Page 21, leave out from ("structure") in line 33 to ("except") in line 34 and insert ("to which this section applies").—(Lord Williams of Barnburgh.)
4.13 p.m.
EARL WALDEGRAVE: I take it we are discussing here, as we must do, Amendments on the Marshalled List numbered 7, 8, 9, and 11. I appreciate that we have a difficult problem here, but, first of all, let me say that the noble Viscount who leads the Opposition asked me whether we had discussed the previous Amendment (I think it was) with the River Boards' Association. Let me assure him that we had and have, and that the River Boards' Association has obviously an extremely good lobby. There is, of course, no harm in that, but it has. The noble Lord, Lord Williams of Barnburgh, said that he is moving this Amendment very largely on the advice of the River Boards' Association.
We have to go into this rather carefully to see what we are doing. First of all, the noble Lord seemed to imply that what he was asking us to do now was to provide statutory consultation. But that is an alternative to wider powers, for which the river boards have often asked but which I do not think can properly be said to be the effect of these Amendments. What these Amendments, taken and read together, are doing are giving the river boards the wider powers for which they asked, which makes them

965
really the planning authority in the flood plain. In their own memorandum, which have seen, they say at the end that if they cannot get these wider powers, then they ought to get statutory consultation. Do let us be clear about that. Whether or not writing "consultation" into the Statute is desirable, I am advised that that is not what these.particular Amendments do. These particular Amendments in fact make the river board the planning authority in the flood plain.
LORD WILLIAMS OF BARNBURGH: Would the noble Earl tell us what he is quoting from when he makes that statement?
EARL WALDEGRAVE: I am quoting from the noble Lord's Amendment—that the consents, and so on, of developers would have to be obtained from the river board, if these Amendments were passed.
LORD WILLIAMS OF BARNBURGH: But is it not the case that, in the last analysis, the Minister of Agriculture and the Minister of Transport would have any final decision if there were any disagreement between the planning authority and the river board?
EARL WALDEGRAVE: I think that is really beside the point.
LORD WILLIAMS OF BARNBURGH: That is the whole point.
EARL WALDEGRAVE: There is the properly constituted planning authority. Noble Lords opposite are generally the first to say—and I agree with them—that it has very responsible and heavy duties in this overcrowded country of ours, and that its rights and duties should not be whittled away unnecessarily or improperly. I am seriously advising your Lordships that, if we accept these Amendments as a whole, and accept what they are intended to do, they will very gravely derogate from the powers of the planning authority working under the existing planning law, and give the river boards very wide planning powers in these areas known as "flood plains".
Let us see what difficulties we get into if we do that. I am fully aware of the problem of planning in flood plains. Building in these flood plains must, of course, be avoided if possible, or at least carried out with full regard to the effect on the régime of the river. I recognise, of course, that where houses are
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built in an area which may flood, the householders suffer. That is bad planning, and is bad for everyone. And, more than that, the river boards —and this is the point at the moment—may be asked to go to great expense to alleviate this flooding. However, this is essentially a planning matter. It is for the planning authorities to decide where building should be allowed and where it should not be allowed; and, of course, they must take all proper considerations into account. They must have proper consultations with other authorities who have rights and duties, and there is the whole basis, under the planning law, of public inquiries, references to Ministers, and so on.
I was surprised to hear that as high as 40 per cent. of planning authorities have never consulted a river board. I had never seen that statistic before, and I am sorry to hear it. I wonder how many of those authorities who have genuinely never consulted with a river board ever ought to have consulted with a river board; and whether, for instance, some of those statistics may have been compiled from authorities who have had no cause to consult a river board, because they were not permitting development in a flood plain. I should not like to take a figure at its face value, and I am sure the noble Lord will not mind if I look into it, because, as I say, I had not seen it before.
We must have this consultation, and I believe that in most cases it takes place. The noble Lord has most fairly stated that my right honourable friend and the Minister of Housing and Local Government intend to issue a joint letter to the planning authorities, saying that these consultations ought to take place. He referred me to a circular which went out in 1947. 1947 is a long time ago. It happens to be before the river boards were formed, because they were not set up until 1948. That letter, therefore, must have been addressed to the catchment boards. The noble Lord feels that that letter has not been fully effective. That is why my right honourable friends are going to bring this matter to a head by sending out a new letter bringing new pressure to bear on the authorities to carry this out. The noble Lord also referred to a circular letter of the Ministry of Housing and Local Government of 1951. I sent for a copy of this letter

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and find that it is almost irrelevant to this subject, only paragraph 11 having anything to do with it.
These Amendments would mean that to a large extent the river boards would usurp the functions of the planning authorities. As I said on Second Reading, and as my right honourable friend said in the House of Commons, that is not a thing that we ought to look upon lightly. Of course, the river boards, anxious to get on with their job of land drainage, would like to have wider powers and not to have to bother with the local planning authorities. They would like to be able to say what factories and residences could be put up in the flood plains they control. But what would it entail, if we were to grant them such powers?
The first thing we should have to do would be to define a flood plain. That is no simple matter. I do not know whether the noble Lord has applied his mind to that. Are we going to define every area that is to be considered a flood plain on a map and declare that for all time this is an area in which the river board is to be "top dog"? Are the river boards to be in a position to say, "If we say there is to be no development, then that is the end of it"? How is this map to be compiled? The river boards are improving their flood plains all the time, and as works to main rivers are done, there is less flooding of land, and this map would have to be constantly under revision to show the changing area over which the river boards have overriding or collateral power.
LORD WILLIAMS OF BARNBURGH: I am sorry to interrupt the noble Earl, but I intend to be helpful. In my speech, I suggested that a flood plain should be designated on identical lines with the procedure in Section 6 of the River Boards Act, 1948. The Minister then had to designate what were main rivers. I think the same procedure should apply here.
EARL WALDEGRAVE: I am fully aware that the noble Lord wishes that procedure to be used and that it is ready to hand, but I am asking your Lordship to consider that it is a much more difficult thing to define a flood plain, put it on the map, and then get it approved,
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than to define a main river. A river flows between banks which can be shown clearly in a map, but the boundaries of a flood plain are highly controversial. River boards, with their strong lobby, will no doubt wish to put their flood plains as widely as possible, on the basis that the more land over which the board has control, the better. I do not want to labour the point, but surely your Lordships can see that to define a flood plain is no simple matter. It is no answer to say that there is a procedure for defining a main river and that the same procedure can be used here. Certainly we may use the same procedure, but the subject is a different one.
I should like to refer to what was said about this subject in the Heneage Report. I do not think that anybody has studied the problem of land drainage so long and thoroughly as Sir Arthur Heneage and his Committee. When considering how to reply to the noble Lord's Amendment, I wondered whether the Heneage Committee had considered this matter, and it is interesting to see that in paragraph 131 (a) their Report says that a river board should have powers "in, over or under a watercourse or drain." That is exactly what we are giving in the Bill —in, over and under, but not a flood plain.
In paragraph 147, on the question of planning, the Report uses these words:
"As a matter of administrative arrangement, the local authority should regularly consult with the river board regarding any proposal for development in the areas so delineated and we understand that this is, in general, the practice. It may be, in some cases, that other considerations will override the land drainage consideration; and that development will be authorised in full knowledge of the drainage problems that will be created."
I did not know what the Report was going to say when I turned it up, but obviously Sir Arthur Heneage saw the difficulty of taking planning out of the hands of the planning authorities and giving it, either collaterally or wholly, to the river boards, and the Report suggested that the proper thing to do is just what we are doing—to say that it is a matter of administrative arrangement.
The Minister concerned can bring to bear a great deal of advice and pressure on local authorities, and they are ready and willing to advise them strongly that it is a common sense matter that they

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should consult with the river boards when development is going to be made in areas liable to flood. This is so much easier than making a statutory flood plain and a statutory procedure for consultation, which would mean two authorities investigating every development.
This matter has been widely ventilated in your Lordships' House and in the House of Commons. Both local authorities and river boards will have read all the reports and heard all of this controversy. It seems to me unthinkable, after all that has been said about lack of consultation in the past in some cases and of the desirability of consultation in future, that the two sensible sets of people who run the river boards and the local authorities will not conclude that they should do this, as everybody wants them to do it; otherwise, it will only mean an Act of Parliament, and somebody is going to lose his powers. I think we must give the question a fair chance, as my right honourable friend said, now that the whole matter has been given an airing, and not take the more radical and, I think, improper step of saying, on insufficient evidence, that the local authorities have failed in this matter, and that we should take away from the local authorities their planning powers and give them, either wholly or partially, to the river boards. That case is nothing like proven. So although I hope that what I have said will convince the noble Lord that we will give this group of Amendments our attention and think about them as a matter of principle very deeply, I hope he will not press them. We have come to the conclusion that it would be wrong to make these very wide changes on the very slender evidence of improper use of the powers we have before us up to date.
VISCOUNT ALEXANDER OF HILLSBOROUGH: I am full of admiration for the detail and enthusiasm with which the noble Earl has defended such a bad case. He has really done his job very well for the departmental view which his Department has taken. Therefore there could be no sense of blame attached to him if this House were to take a different view. But the more I listened, the more I was astonished. We were, of course, quite familiar with the debates which took place in another place, and of course we also knew about the views the
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river boards took. They asked me especially to see that this matter was properly considered on a fair basis when it came to this House. Therefore we kept in touch with them and we have been in touch all the way. The extraordinary thing we noted in another place was this constant claim on the part of the Department that these suggestions for amended legislation by river boards were to give them partial or wholly control in planning. There is not a word in these Amendments which says anything of the kind—not one word.
Let me say this. I have been in Parliament now since 1921 or 1922 and I have done a good deal of governmental and departmental work. I have also had some connection with all the extraordinary planning which has to be done in such complex and complicated Services as the military services, and with all the various kinds of operations on their programmes for buildings and sites, for medical provisions—for everything. There must always be adequate consultation between all those various sections of the plan in order to make it effective in its work and operation. There has always to be consultation, and the Minister has admitted that that consultation is essential. Why has it not worked so far? Because, apparently, whilst there have been very satisfactory results in the case of consultations which have taken place on a voluntary basis with the town planning authorities, where there has been no consultation although it has been asked for, and could easily have been given, by the local authority concerned, there has often been great difficulty.
EARL WALDEGRAVE: Would the noble Lord give me one case where consultation has been asked for and refused?
VISCOUNT ALEXANDER OF HILLSBOROUGH: I could not on the spur of the moment, but I shall be glad at a later stage to try to confirm my impression on that point. We are not asking in any sense for the river boards to be made a planning authority in contra-distinction to, or cutting across the line of approach of, the general planning authority, What we say is that if the Department thinks so it is a very valuable thing to have these consultations; and if in some parts of the country consultations are not

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taking place where the river boards think they should have taken place, the only thing is to bring it into line and have a proper regulation laying down that consultation should take place.
But what happens after? The Minister threw some doubt on what was the line of duty of preparing, say a map of the river plain. It is quite clearly laid down in the Amendments. The river board will be responsible if they want to get some special provision made for making a map, coloured, if necessary, for the various points they want to mark. They will send it to the Minister and he may approve it or he may alter it. The difficulty of making a map does not seem to be of any real substance at all. In regard to the general result always the Minister has to approve. There is no power asked for the river board to be a law to itself, to lay down a line of action and say "This has got to be, 'or else'." There is none of that. This is purely consultation, and consultation on matters within the province of the Minister and in which the Minister can say "Yes" or "No" even after the consultation has taken place.
The local authorities concerned have been circularised twice—and I do not think very much of the argument of the Minister about whether this or that particular circular did not apply. It might be in the case of housing that that was so, but anybody who knows anything about town planning duties in general knows that the whole range of erections which can take place do not come generally within the necessity for immediate approval before anything is done. Therefore, what we want to see is that there should be proper consultation with regard to all kinds of other building. The Minister I think would either have to promise to think again or we must surely vote for the Amendment as it stands, and not be put off by the departmental assumption that river boards are seeking for special additional powers for themselves. All we are asking for in the Statute is a requirement for the planning authorities to consult with the river boards in their areas. I hope the Minister will reconsider his position.
EARL WALDEGRAVE: I do not want to make another long speech. First, I
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do not as a matter of principle take it as a compliment when I am told I have used a good argument in which I do not believe. I do not know why the noble Viscount should think that this is a departmental argument—not my own.
VISCOUNT ALEXANDER OF HILLSBOROUGH: I did not say you did not agree. I said it was departmental.
EARL WALDEGRAVE: I should like to say now that I believe in this departmental argument. The whole thing the noble Viscount has tried to say is that there is not a word about giving these wide powers to the river boards. But the effect of these Amendments will be that developments in flood plains will require the consent of the river boards. At the moment they require the consent of the planning authority after they have consulted other bodies. It is not quite true that the Amendment does not give the river boards more powers. The Opposition will have to move different Amendments on the Report stage because I am advised that these Amendments will give the river boards such powers:
"No person can erect any structure … except with consent … and in accordance with …"
and so on. I am advised that that does give them greater powers.
LORD WILLIAMS OF BARNBURGH: The noble Earl has quoted from the Bill, not from the Amendment.
EARL WALDEGRAVE: I tried to quote from the Bill as it would be amended, but it is difficult to read it in. I would say that my reading of this, and my advice on it, is that this would give the river boards these greater planning powers.
The other point has already been mentioned, but the noble Viscount who leads the Opposition came back to it—that is, the matter of consultation. I entirely agree with him that there should be consultation. But then he says: "What happens if you do not get consultation?" I am suggesting, first of all, that the figures which were given of the developments which have not been done after consultation with the River Boards, and the lack of consultation, is exaggerated. Secondly, I do not think the only answer to lack of co-operation between local authorities is to take statutory action.

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Surely you take administrative action first, and in a case where it has been done badly the two Ministers write to the local authorities concerned and say: "I wish you two would consult and do this better." I will not say more, other than that I think these Amendments go much too far. My advice to your Lordships is that this would give collateral planning powers to the river boards, and there is no case for that until we have much better proof that consultation does not work. If noble Lords opposite insist upon dividing the Committee, I ask your Lordships to resist the Amendment.
VISCOUNT ALEXANDER OF HILLSBOROUGH: I am obliged to the noble Earl for attempting to reconcile us, but I go back to a copy of a letter which I understand was written by the Minister to Sir Richard Nugent. This is the kind of impression that he wanted to make on the other place. He wrote:
"I do appreciate the seriousness of the problem with which river boards can be faced when
5.52 p.m.
EARL WALDEGRAVE: I should have mentioned in the debate on the last Amendments that I was going to
building or other development takes place on land liable to flooding, and I am as determined as you are to see that this is properly controlled".
"Properly controlled" means after proper consultation by all the interests affected, and especially the planning authority itself and the river board. So that if the Minister has nothing further to say, I do not see that we can do other than divide.
EARL WALDEGRAVE: I cannot let that statement go without a reply. If the noble Viscount is praying in aid my right honourable friend, who says that he is as much concerned as some other honourable Member of the other place that it should be controlled, and is convinced that this gives control, all I say is that I think the argument can work both ways.
On Question, Whether the said Amendment be agreed to?
Their Lordships divided: Contents, 25; Not-Contents, 54.

CONTENTS

Albemarle, E.

Henderson, L.

Macpherson of Drumochter, L.

Alexander of Hillsborough, V.

Latham, L.

Peddie, L.

Amwell, L.

Lawson, L.

Silkin, L.

Attlee, E.

Lindgren, L.

Stonham, L.

Boyd-Orr, L.

Listowel, E.

Taylor, L.

Burden, L. [Teller.]

Longford, E.

Walston, L.

Crook, L.

Lucan, E. [Teller.]

Williams, L.

Faringdon, L.

Macdonald of Gwaenysgor, L.

Williams of Barnburgh, L.

Wise, L.

NOT-CONTENTS

Ailwyn, L.

Fraser of North Cape, L.

Meston, L.

Amherst of Hackney, L.

Freyberg, L.

Mills, L.

Ampthill, L.

Goschen, V.

Molson, L.

Amulree, L.

Grenfell, L.

Montgomery of Alamein, V.

Auckland, L.

Hampton, L.

Mowbray and Stourton, L

Bathurst, E.

Hastings, L.

Newton, L. [Teller.]

Boston, L.

Hawke, L.

Northesk, E.

Brecon, L.

Horsbrugh, B.

Ogmore, L.

Brentford, V.

Iddesleigh, E.

Onslow, E.

Bridgeman, V.

Jellicoe, E.

Perth, E.

Buckinghamshire, E.

Jessel, L.

St. Aldwyn, E. [Teller]

Colwyn, L.

Killearn, L.

St. Oswald, L.

Conesford, L.

Kinnaird, L.

Sinha, L.

Crathorne, L.

Lambert, V.

Spens, L.

Derwent, L.

Long, V.

Templemore, L.

Elliot of Harwood, B.

McCorquodale of Newton, L.

Torrington, V.

Exeter, M.

Massereene and Ferrard, V.

Tweedsmuir, L.

Fortescue, E.

Merrivale, L.

Waldegrave, E.

Resolved in the negative, and Amendment disagreed to accordingly.

move this Amendment, because it goes some way to help in this problem of the flood plains. We feel that we should bring in this Amendment because we all know that the river boards are worried about the control of development in the flood plains. We think that where

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private flood banks affecting main rivers have been erected (which do not require specific planning permission) the river boards should have control. I do not think I need go into the details of this Amendment. This is a particular form of structure which we think does not require specific planning consent. It is under the blanket of the general provisions. I beg to move.
Amendment moved—
page 21, line 40, at end insert—
("() No person shall erect or alter any structure designed to contain or divert the floodwaters of any part of the main river except with the consent of and in accordance with plans and sections approved by the river board.").—(Earl Waldegrave.)
VISCOUNT ALEXANDER OF HILLSBOROUGH: I am much obliged that on this occasion the Ministry have been thinking along exactly the lines we have been thinking in moving the other Amendments. Perhaps we may make progress further on. Anyway, we accept this Amendment.
On Question, Amendment agreed to.
Clause 30, as amended, agreed to.
Clauses 31 and 32 agreed to.
House resumed.

ARMY AND AIR FORCE BILL
Brought from the Commons; read 1a, and to be printed.
FORTH ROAD BRIDGE ORDER CONFIRMATION (No. 2) BILL
Brought from the Commons; read a, and (pursuant to the Private Legislation Procedure (Scotland) Act, 1936) deemed to have been read 2a and reported from the Committee.
COURT OF CHANCERY OF LANCASTER (AMENDMENT) BILL
House in Committee (according to Order): Bill reported without Amendment.

POLICE FEDERATION BILL
4.57 p.m.
Order of the Day for the Second Reading read.
LORD STONHAM: My Lords, I beg to move that this Bill be read a second time. I think your Lordships will be aware that the Police Federation was established by the Police Act, 1919, for the purpose of enabling the members of the Police Forces of England and Wales to consider and bring to the notice of the police authorities and the Secretary of State all the matters affecting their welfare and efficiency, other than questions of discipline and promotion affecting individuals. The constitution of the Police Federation, which is set out in the Schedule to the Act, provides that the Federation is to consist of all members of police forces below the rank of superintendent. The Schedule to the Act also provides that the members of every police force below the rank of superintendent shall form a branch of the Federation, and that in all police forces there shall be separate branch boards for the constables, sergeants and inspectors. The boards are elected by the members of the several ranks, and they choose delegates to attend the central conferences for the three ranks; and the members of the central conferences elect the three central committees, each consisting of six members, again for constables, sergeants and inspectors.
When the Metropolitan Police College was established at Hendon it was felt that officers who were at, or who had passed through, the College, ought not to be members of the Police Federation. These officers passed out of Hendon as junior station inspectors, and they might thereafter become station inspectors, sub-division inspectors and chief inspectors before ceasing to be members of the Federation on promotion to the rank of superintendent. Accordingly and, as has long been felt, very unfortunately, Section 3 of the Metropolitan Police Act, 1933, provided that junior and station inspectors, sub-divisional and chief inspectors of the Metropolitan Police should be no longer members of the Police Federation. When the Metropolitan Police College closed, the rank of junior station inspector, of

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course, became obsolete. Later in 1949, sub-divisional inspectors were designated chief inspectors, and the chief inspectors became superintendents, so that when the rank of station inspector also became obsolete and was finally abolished in 1955, out of all the four ranks of inspector who were excluded from membership of the Federation by the Act of 1933 only the chief inspector now remains. It is only the chief inspectors on the Metropolitan Police, some 170 in number, who are now excluded from membership of the Police Federation; and chief inspectors of all other police forces throughout the country are members of the Police Federation.
It is not surprising therefore that in 1949 the Oaksey Committee, in paragraph 361 of their Report, said that the Metropolitan Police chief inspectors should be restored to membership of the Federation, and pending legislation—, this was twelve years ago—arrangements were made under which these chief inspectors have for the last seven years taken part in the affairs of the Federation on a non-statutory basis as advisers to the Inspectors Branch Board and they have sent delegates to the Central Conference, although, of course, they have no voting rights since they are not members of the Federation. I think these arrangements have worked satisfactorily. It has been accepted by everyone concerned that legislation would be introduced as soon as possible to restore chief inspectors to membership of the police Federation. That is precisely what this Bill does, and indeed it is all that it will do in its present form.
Unfortunately therefore, in its present form, it omits another long-awaited improvement which was also recommended by the Oaksey Committee—namely, separate representation for policewomen on the boards, the conferences and the committees of the Federation. Your Lordships will appreciate that there are some 2,000 policewomen, compared with more than 70,000 police officers, and I believe that only one policewoman has ever succeeded in being elected to any of the committees or conferences of the Force. It is highly desirable that there should be this special representation, and I shall therefore be submitting for your consideration in Committee a new clause and a Schedule which will make good the
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present deficiency in respect of policewomen. I should say, my Lords, in case the thought has occurred to you, that these Amendments would have been moved in another place and would therefore have been embodied in the Bill when it came to your Lordships' House but for the fact that the Amendments will involve a slight alteration in the Long Title of the Bill and that could not be done in another place. So, at least, we have the consolation of not only doing a good deed but of proving that we have our uses.
In approving this measure, particularly in its final form, we shall be performing a small but useful service for a fine body of men and women who do a great service for the community and therefore I trust your Lordships will give the Bill a Second Reading. I beg to move the Bill be read a second time.
Moved, That the Bill be now read 2a—(Lord Stonham.)
5.5 p.m.
EARL BATHURST: My Lords, I should like to congratulate the noble Lord opposite on behalf of Her Majesty's Government for his lucid and excellent explanation of the Bill that he has put before your Lordships, and I should also like to congratulate his honourable friend in another place, Mr. Edwards, upon introducing This Bill. As the noble Lord has said, it puts into operation the recommendations of the Oaksey Committee in 1949. The noble Lord has said that he will be tabling some Amendments which your Lordships will see in the near future, and I can assure the noble Lord that my right honourable friend in Her Majesty's Government will give him all the help that is possible with these Amendments. I commend this Bill to your Lordships and wish it good luck through its remaining stages in your Lordships' House.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

SMALL ESTATES (REPRESENTATION) BILL
House in Committee (according to Order): Bill reported without amendment.

THE COLONIAL DEVELOPMENT CORPORATION
5.8 p.m.
LORD WALSTON LORD WALSTON rose to call attention to the Report and Accounts of the Colonial Development Corporation for 1960; and to move for Papers. The noble Lord said: My Lords, as part of the preparation to which I subjected myself for this debate I read the OFFICIAL REPORT of the debate in your Lordships' House on this same subject nearly a year ago. I may say that it was not an onerous task that I set myself; it was full of interest. One of the things which struck me as being of particular interest was the remark made by the noble Lord, Lord Twining, who I am sorry to see is not in his place to-day, as I had hoped he might be taking part in this debate again this year, in which he (to use his own words) looked "into the crystal ball to see what is going to happen next year". Well, we are now in "next year", and it is rather sad and rather significant to find how very accurate the noble Lord was in his crystal-gazing.
He said, if I might remind your Lordships, without quoting his exact words, that he believed we should still be deploring the fact that the Government had not yet acted upon the recommendations of the Sinclair Committee. Secondly, he said we should still be urging upon the Government the need for greater funds for the Colonial Development Corporation; and, thirdly, he could see in his crystal ball the fact that we should once more be urging upon the Government the need to enable the Colonial Development Corporation to extend its activities to cover, in his words, "those countries which had already received their independence". I strongly suspect, not only so far as I am concerned but so far as other noble Lords who will be following me will be concerned, that the debate will run regrettably true to that prognostication. Nevertheless, in spite of the fact that we may still be saying very much the same things that your Lordships heard twelve months ago, I believe it is well worth while and important to have an opportunity now to discuss the last twelve months' activities of the Colonial Development Corporation.
It is a vast concern, a concern dealing with a very large amount of Government money, taxpayers' money. It is a concern which not only is huge financially but is huge geographically, going actively into many parts of the world and carrying with it a very large degree of prestige and a very large degree of influence for good which can only redound to the credit of this country. So even though much of this debate may be a repetition of what has already taken place it certainly, in my opinion, will not be time wasted.
Perhaps I may turn for a short while to the actual Report of the Corporation for the calendar year 1960, which I am sure all of your Lordships who are here at the moment will have read and studied There are one or two points which I think it is worth bringing out and drawing to your attention. In the first place, it is a Report which shows progress. It shows that there are now 91 projects in active being, compared with 88 last year. It shows that there is now nearly £110 million committed, although of course not by any means all spent. compared with last year's figure of £96 million. So the Corporation was not idle in that respect either. Ten new projects have been started—certainly some of the other ones have now run their course—and the cost of those new projects is estimated to be somewhat over £11 million. All these are big, rather frightening figures for private individuals, and should be possibly rather frightening figures, even for Government expenditure. But the fact that they are frightening does not mean they are bad figures; they are essentially important and good figures, showing that the Corporation are active and do not just sit down and let things go quietly on their normal way.
It has, of course, been a relatively profitable undertaking. I say "relatively", not with any intent to disparage: I should be far more critical of the Corporation if it had been extraordinarily profitable. It was not set up originally to make a large profit. It was set up with the instruction that, taking one year with another, it should show a fair and reasonable return on capital. I think it has succeeded in doing that. Its accounts show that it made a net operating profit in 1960 of £2·4 million. Out of that, of course, has to go payment to

981
the Government for interest and annuities, payment of £1· million. The £2·4 million, incidentally, is an improvement on the previous year, when the figure was just under £2 million, £1·9 million. So it has succeeded financially in doing what it was instructed to do originally. It has covered its expenses; it has paid an appropriate rate of interest—in some cases, in my opinion, rather unduly high interest. But it has paid that interest and it has come out with a small amount on the credit side.
But there are one or two parts of the financial result which I think are somewhat disquieting. The profits from what are called direct projects undertaken by the Corporation, never very large, have shrunk. They have shrunk from £190,000 in the previous year, to £145,000 in 1960, while, on the other hand, interest from investments has risen from £1·7 million to £2 million. We cannot complain that the Corporation is making less profit, but I should be happier and more confident that it really was doing the job it was set up to do if it had a larger amount of money invested in the direct projects and a smaller amount in what, in the accounts, come under the heading of "Investments". Perhaps your Lordships will allow me to return to that point a little later.
While I am dealing with these actual figures, there is one other point, though not directly concerned with the Corporation, which I think is of interest and worth bringing out. Many of us feel—and I have on occasion mentioned it in your Lordships' House already—that in the present state of the world the actual production of wealth, particularly from the land, is something which does not bring in a sufficient amount of profit, does not give to those who practice it a sufficient margin of profit compared with other somewhat less productive enterprises. I think that the Accounts of the Corporation bear out this contention. It is interesting to see that of their direct projects, of the enterprises which are agricultural enterprises—and there are eight of them altogether—only two of those made profits and the other six showed losses, whereas, of their seven non-agricultural enterprises in their direct projects, all of those finished up by making a profit.
I want to emphasise that I am not saying that by any way of criticism of
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the way the Corporation runs its agricultural enterprises; I have no criticism of them, but it does make it very clear that the primary producers, and in particular the agriculturists and farmers and peasants, whether they be on the very large scale of the Colonial Development Corporation or on the very small scale of peasant farmers and smallholders, must look forward to a very much lower margin of profit, and very frequently substantial losses, compared with people operating in similar circumstances in similar countries who are not actually producing the wealth from the soil.
There are many good points in this Report of the Corporation which has been produced for last year, and I would pick out only two of them. One that I was particularly glad to see was the fact that the Corporation are now making available—they admit that it is in small quantities—scholarships for promising students in the areas in which they operate, to send them to universities, to training institutes or colleges, and in that way give incentive and encouragement to young men who otherwise would be unable to get the education which they deserve and from which they can profit. I believe that that is an admirable thing for the Corporation to have done, and I very much hope that in future Reports we shall find that they have been able to extend and increase these scholarships and grants.
Another thing which I find extremely interesting, and for which I think they deserve much credit, is the efforts that they are making in areas where they operate to encourage co-operation and assist the small farmers to get some of the benefits of large-scale operation. There is, in particular, a scheme to encourage and assist tea-growing among the African peasants in Kenya, which is very much worthy of praise. I hope we shall hear a lot more about it in following years, and that it may become a model for many more developments of that particular kind.
I would now turn to a few criticisms of some of the matters to be found in that Report, though in the main these criticisms are directed against the Government and Government policy, rather than against the Corporation itself. I hope that, as a result of some of them, the Government may modify some of their views. One of these is an age-old and

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probably inevitable criticism: the criticism of delays in Government Departments; the slowness in receiving answers to questions which have to be put up for approval which has to be obtained. This is, I may remind your Lordships, something which was mentioned in the Sinclair Report also, now several years old.
Just as one specific example of this, you will read in the Report of the activities in the Carribbean, of a scheme in Castle Bruce, a small estate in the Island of Dominica. Application was made to the appropriate Government Department for capital expenditure on December 9, 1959, and by the time the Report was published on December 31, 1960, no authority had yet been received from the Government Department—one year and three weeks.
LORD HAWKE: My Lords, could the noble Lord tell us a little more about that? What sort of crop is it proposed to grow? The Government might have been aware that there was a world surplus of that crop, or something like that.
LORD WALSTON: I could not say with authority what crop it was. From my knowledge of the locality I should expect that it might well be bananas; it could also be cocoa, or it could have been copra. Certainly, if it were bananas, I am glad to say that there is no surplus. The growing of cocoa is something which the Government is encouraging in this island. But whether or not it was something which should have been encouraged or discouraged, my contention is that it is only fair to the people who want to do the job to make up your mind in less than twelve months whether you want to discourage it. In fact, I am informed that permission has now been given and the project can now start; but that is only in the last few months. I suggest to the noble Earl that he should ask his Department firmly to do its best to see that delays of this kind do not arise, because, quite apart from any inefficiencies from the business point of view, it can be extremely frustrating for the people, not only in head office but actually on the spot, who want to get on with the job, to be told month after month, "We are still awaiting ministerial approval."
Another and more serious criticism, again of Government policy, is that
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which is referred to in the Report itself. May I first read what is set out at page 51 of this beautifully produced, but rather gaudily coloured Report, discussing what is going on in North Borneo. It is there written:
"In North Borneo, U.K. Government's attitude towards C.D.C. undertaking projects without a partner has inhibited progress on several agricultural schemes which could have been handled by extension from the secured base of C.D.C.'s successful Borneo Abaca project."
At this stage I do not want to go into too much detail as to the advisability or otherwise of schemes in partnership with other people. But whether you think it is a good idea that C.D.C. should, in the main, operate with partners or not, it is surely going against the laid down objectives of the Corporation that they should be prevented from undertaking works which are admittedly of use in an area where they should be operating, and which they believe not only should be carried out but can conveniently and efficiently be carried out from their existing sources of administration—that they should be forbidden on what appears to be purely doctrinaire grounds to undertake any new projects unless there can be found a suitable private enterprise partner. I hope that the noble Earl will be able to tell us categorically that that is in fact not the policy of his Department; that he is prepared, provided the case that is made out is a good one, to authorise without undue delay entirely independent projects by C.D.C., whether they are able to get a partner or not.
Perhaps I may say a few words now on this question of partnership—how much there should be partnership and how much C.D.C. should act as an entirely independent body. My own view is that there is no reason whatsoever why C.D.C. should have to operate independently or why it should have to operate in partnership; each case should be taken on its own merits. Undoubtedly, where suitable partners exist, and in particular where there are local partners, people who are already engaged in some form of activity in the particular area, people whose livelihood depends on that particular area, every encouragement should be given to entering into partnership with such people or such groups.

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I further feel that there is much to be said for working in partnership with people who are not already in that area —bringing in outside people who would not otherwise have come, and who either have money that they are prepared to invest or have a particular type of expertise which is going to make a joint project far more valuable to the area than it would be without that expertise. As an example of that, it seems to me that it is an admirable arrangement which the Corporation has entered into with Courtauld's in Swaziland, where the Corporation developed the forestry and has grown the raw material. To enter into co-operation with a firm which is well experienced in the use of that raw material and in producing from it something of value and giving employment, is an admirable form of partnership. It is one which I hope will continue and of which we shall see more in the years to come.
On the other hand, there seem to be a growing number of partnerships about which I am not quite so happy. For instance, three, if not four—I think it is three—cement partnerships have been entered into. The production of cement in all of these countries is of enormous importance. A cheap supply of durable building material is essential for the development of all these hitherto underdeveloped countries, and such new enterprises should be encouraged. But I cannot help feeling that the cement industry in this country is so vast and has such resources at its disposal that in fact, if it were left to itself, given encouragement, but no more, it should be able to finance these undertakings, without making use of the capital and resources, which are already close to becoming strained, of the C.D.C. The same argument applies to housing finance. There, again, a great deal of housing is needed, and we should be extremely grateful for any action that is taken to see that more and better houses are produced in every single one of these territories. But I cannot help feeling that the Eagle Star Insurance Company, into partnership with which the C.D.C. has entered in Jamaica, could have found, somewhere from among its own friends in the City sufficient funds, if it did not already possess them itself, to enable it to start a housing finance scheme without calling
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on the C.D.C. to provide some of the capital.
The same remarks apply to hotels in the West Indies. They are valuable; they bring in tourists and foreign exchange. All of this is desirable. But there are many hotels already going up without any help whatsoever from C.D.C. and it appears to be sufficiently profitable as an industry to enable finance to be found, in most cases without C.D.C. help. Once again, I do not see why it is necessary for C.D.C. to go out of its way to provide money for these projects. It should provide help, facilities, the advice and experience of its staff, but keep its money, of which it has far too little, for those things which cannot be financed from outside sources.
There is one further activity in regard to this question of partnership where I have doubts. I will not say anything stronger than that, because my mind is still open on the matter. It concerns the fertiliser project in Trinidad,in co-operation with the Grace Industries of the United States. Throughout the whole of the West Indies fertiliser is essential. At the moment it is being imported almost entirely from this side of the Atlantic, and obviously it has to stand high freight charges. Undoubtedly, it would be greatly to the advantage of agriculture in the Caribbean area if fertiliser were produced in one of the islands, and Trinidad is probably the most suitable place for that. So I am not in any way against fertiliser being produced there, nor against C.D.C. assisting in some way. But I foresee there can be some very difficult problems arising to the management of the Colonial Development Corporation if it is too closely involved in the manufacture of fertiliser.
It is an industry which has to face very hot competition from abroad. It is an industry which, I understand. in Trinidad now is trying to obtain from the Government of Trinidad protection by way of tariffs against imported fertilizers—and it may well be that it is right for it to have that protection in an infant industry—in order to build up for the eventual benefit of the island and the users of fertilisers. But I can see that it would be extremely embarrassing for the Colonial Development Corporation, with its very wide interest

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throughout the whole Caribbean area—and the same would apply to other areas if it decided to assist the manufacture of fertiliser in them—if it were to be associated in the eyes of the users of fertilisers with the pressure on the Government to raise the cost, albeit only temporarily.
As one of the deeply interested parties in the manufacture and, on the other hand, as a user, of fertilisers, and as an encourager of their use, it should be looked on as the friend of the cultivator, even in the short term. For that reason I should feel happier if the Corporation had been able to give all forms of assistance short of investment to this American company in starting this fertiliser industry in Trinidad, rather than becoming actually financially involved in it. So much, my Lords, for the Report and what is contained therein.
May I now turn once more to Lord Twining's "crystal ball"? The Sinclair Report, which was the subject of so much discussion last time your Lordships debated this subject, has now not only appeared—it appeared before last July—but it has been studied by the Government, and they have made up their mind on what action they should take. But the short answer is that the Government have decided to reject the Sinclair Report. The main proposal, the main recommendation, of the Sinclair Report was, in effect, that the Government should become a shareholder in the Colonial Development Corporation; that they should not be simply the provider of money at fixed rates of interest, but should have a share in the risk and in any profits that might accrue and, at the same time obviously, carry any losses.
I do not want to weary your Lordships with a long argument as to why the Sinclair Report seems to be on the right lines. It would be presumptuous of me to do so in any case, because I am not qualified to advise or have opinions on the right structure of a vast financial company. But it seems to me, in the first place, that this Report was brought out by three wise and experienced men in whom the Government presumably have confidence. In spite of producing a relatively long Report, they made clear-cut recommendations which certainly can not be turned down on any grounds of
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running counter to Government policy or national policy. Therefore, it is at least unfortunate that those recommendations have not been acted on.
Further, from the purely common-sense point of view, one cannot get away from the fact that the C.D.C. is, financially speaking, the Government. It operates solely on Government money. Therefore, there can be nothing other than administrative convenience, tidiness of accounting, to make it advisable to present its accounts in one form or another. If the C.D.C. went bankrupt to-morrow the Government would lose the money. If the C.D.C. were able by some means to double the capital value of their investments to-morrow it would be the Government that would benefit. It seems to me that the recommendations of the Sinclair Report would have undoubtedly made this position clearer, simpler, and would have been far more convenient from the point of view of the Government and, above all, from the point of view of those running the C.D.C. So I am sorry to see that those recommendations have not been accepted but that, instead, some scheme which is of assistance—though somewhat complicated, and not a clear-cut straightforward scheme—though only minor assistance, has been adopted in place of these much more sensible and rational proposals which the Sinclair Committee put forward.
The second point Lord Twining foresaw we should be discussing after the Sinclair Committee had reported was the need for more cash: greater facilities for the Colonial Development Corporation to obtain capital for its undertakings. My Lords, I do not think there is any need to labour that point. We have had many debates, even within the last few months, which make it very clear how necessary it is for us in this country to invest as much as we conceivably can in underdeveloped areas, and, in particular, in the Colonies and in the Commonwealth.
It is true that the Corporation still have approximately 40 million on which to call. That may seem a very large amount of money. It is a large amount of money. But we hope they will—I will not say spend that money rapidly, but not be slow in investing that money; because, as the noble Lord, Lord Casey, last week and many other noble Lords

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on other occasions (in the technical cooperation discussion, and so on) have pointed out, the need for it is great and the need for it is becoming increasingly urgent. So I hope it will not be very long before the Corporation are in the position of saying, "We have exhausted our borrowing facilities and if we are to do any more we must have greater borrowing facilities."
But we cannot afford to wait for that time, because if the Government take fifteen months to decide whether Castle Bruce in Dominica should have spent £15,000 on a new project, they will undoubtedly take many months, if not years, to decide whether the Corporation's borrowing powers should be extended from their present limit by another £25 million or £50 million. That is a matter which requires deep thought and much consultation with many other Government Departments, and for that reason I hope that the noble Earl will tell us in his reply that his Department have already started to give thought—and sympathetic thought—to this, and that negotiations with the Treasury and the other interested bodies are already well advanced.
I may perhaps remind noble Lords that on the last occasion when this matter was being debated the noble Lord, Lord Hastings, was very urgently concerned that borrowing powers should be increased. He went so far as to suggest that the Government might well restrict expenditure on the National Health Service at home in order to provide money for extending possibly not only national health services but many other services of which those underdeveloped countries overseas are in need. I entirely agree with the second part of his contention, though I would not agree with the means by which he suggested the money should be raised. Unfortunately, the Government listened to the first part of his recommendations, and have cut the National Health Service; but the money so obtained (much, I am sure, to the disappointment of the noble Lord, Lord Hastings) has not been made available to the Colonial Development Corporation, but has been made available to the payers of surtax in this country.
The third point of Lord Twining's "crystal ball "concerned the Commonwealth and whether the Colonial
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Development Corporation should continue to be restricted in its activities to the Colonies or should extend its scope to the Commonwealth. I find it very hard to argue this point because I find it very hard to see what arguments there may be against it. It seems to me unanswerable that we must have more investment throughout the whole of the Commonwealth, and it seems to me unanswerable that the Colonial Development Corporation, by its past record, by the contacts that it has, by the staff that it has and by the achievements that it has to its credit, is the appropriate and the only sensible body to undertake these further investments and this development throughout the whole of the Commonwealth. Even if the fact that in many of those areas where they have operated so successfully they are now debarred from carrying out further work because of the change from Colonial status to being an independent member of the Commonwealth did not reinforce this argument, it seems to me that they have proved their ability to do this; and that, with these contacts, with this local knowledge and with this experience, they should be entrusted with this further and wider responsibility of helping in the development of the whole Commonwealth.
On top of that, a further argument, surely—and it is not an insignificant one —is the argument of the morale of the people who are at present working, and working so admirably and so devotedly, with the Corporation. How would any of us enjoy being part of an organisation which we knew full well in another two or three years—in fact, year by year; every twelve months—would have a smaller scope for activities? Possibly, if we were near retiring age we might say, "We will carry on; it will just about see us through". But there are many who are not near retiring age; who are young, active and full of enthusiasm for this job. They cannot be expected to remain with the Corporation and to give of their best if they do not have the hope, even if not the confidence, that their scope is going to be enlarged to cover the whole of the Commonwealth. Even Government Departments know that they cannot really fulfil their functions properly if they are static. Every organisation must either go forward or backwards. It is interesting to

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see that the Government Departments, almost without exception, go forward at least in so far as increasing the scope of their activities is concerned—and where they are unable to do that they invoke Parkinson's law and increase the area of their office space and the number of people employed in it. The Colonial Development Corporation have resisted that way out, but I think we owe it to them, as well as to the Commonwealth as a whole, to ensure that, in the years to come, these activities will have an even wider field than they have at the present time.
My Lords, my final words are on the development of this idea—not an original idea by any means. There is the proposal which I think the noble Earl, Lord Lucan, made last year of a Commonwealth Bank. Would it not be an advantage, not only to the receivers of this help but also to this country and to the idea of the Commonwealth which was so ably put forward by the noble Lord, Lord Casey, last week, if the Colonial Development Corporation were not only to change its name to the Commonwealth Development Corporation, not only to extend its scope to cover the whole of the Commonwealth, but also to bring in, as givers as well as receivers, all members of the Commonwealth, where we can find a great deal of ability and experience of just the sort that is needed for continuing this work on a wider scale? I once more ask the noble Earl to give serious consideration to extending the scope of the C.D.C. It is useful that there is no need to change the initials or even the emblem on its writing paper or its documents, in changing its name to the Commonwealth Development Corporation. It would be able to give great help to the members of the Commonwealth; and, at the same time, it could absorb from the members of the Commonwealth the experience, the "know-how" and the expertise that they have to offer us.
The members of this Corporation, by the figures that they have produced, have done what can be done. I think it is a very great tribute to all of them, from the top to the bottom, that, with the difficulties and the uncertainties that are facing them, they have been able to achieve such remarkable results, not only during the last twelve months but
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over the years which have passed. Credit goes to those who started it; to those who had the original concept; to those who worked with it in the early days; and, above all, to those who are working with it to-day. I hope that your Lordships will give every encouragement and support to the Corporation in the future. I beg to move for Papers.
5.46 p.m.
LORD AMULREE: My Lords, it is always a great pleasure, when the Report of the Colonial Development Corporation comes out, to be able to look at this very well-presented document and to read the fascinating and interesting story which it has to tell. Therefore I should like to associate myself with what has been said by the noble Lord who has moved this Motion in paying a great tribute to those who work for the Corporation, for the work they have done and for the work they are going to do in the future, which we see very well before us.
I do not intend at the moment to follow the noble Lord into the great detail into which he has gone in dealing with this Report. That would be inappropriate at this hour. Besides, it would merely be repeating what has already been said, and said much better than I could say it myself. However, I should like to emphasise what a very remarkable body the Colonial Development Corporation is, and the great pleasure it gives one to be able, in one's limited capacity, to make this work known better to the world. If there were more bodies like this working in other countries, I think the future of the emerging countries would be much better and more secure than it is now. Their extraordinary structure—being, as I think they call themselves, the mixture of an equity-type investment company and a loan organiser or supplier—seems to work very well, although one might have thought, when such an idea was mooted, that it would not do very well.
There was one thing which I read with great interest, and that was paragraph (2) on page 9, which begins with the words:
"The development of smallholder farming can contribute powerfully to the stability of a country".
That seems to me such a sane and sensible thing to say, and one is pleased to observe that that policy is being carried

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on in encouraging smallholders, by means of loans, to work and found these small farms, from which they will learn a great deal and from which they will be able to teach other people when the moment comes.
There are two very important things in this Report. The first is this new policy of founding a number of scholarships for training people by their coming over to this country; and, although the Report says that the numbers are at present very small, one hopes that in time they may increase, because I am sure that that is one of the ways to encourage people and to make sure that the money which is going to be invested in the Corporation will not be wasted. The second thing, which the noble Lord, Lord Walston, referred to, was the fact that the C.D.C. wants more funds. I am sure no one would doubt that, but certainly I trust it will not come from the National Health Service. That would be a catastrophic thing. When one thinks of the enormous number of bombs which are made, which are comparatively valueless, surely the cost of one of them might possibly be turned to the Colonial Development Corporation, with great mutual advantage to the people of this country and to the people who are getting the benefits from the Corporation.
Another point on which I should like to support the noble Lord is that it seems sad and tragic that when a country becomes independent within the Commonwealth the Colonial Development Corporation cannot continue its full work there. I was pleased to see in the Report that Malaya and Nigeria had managed to come to some agreement whereby the people there could continue their work; but it seems a tragic thing that at the moment when a country want3 every possible support it can get an experienced, valuable body like the C.D.C. can no longer work there. One would very much like to see some encouragement given to the idea, as the noble Lord suggested, of a Commonwealth Development Corporation, so that it could work in far more countries than it does at the present time.
My Lords, that is really all I want to say on the subject, and I am afraid I have merely followed the noble Lord, who was himself, as was the noble Lord, Lord Twining, looking into his crystal
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ball; and we find that what the noble Lord, Lord Twining, said a year ago is unfortunately true at the present time. I trust that when we talk about this question next year there may be some kind of change, so that we shall not disappoint Lord Twining for the second time.
5.51 p.m.
LORD MACDONALD OF GWAENYSGOR: My Lords, a number of my noble friends have already told me that they have other engagements, and asked if I would mind if they were not able to be present. I told them that I was over half an hour late for my engagement, and that I would be very brief, because I, too, have to go. In the first place, may I compliment my noble friend behind me? His contribution, like all the contributions he has made since he entered your Lordships' House, was marked with clarity, cogency and thoroughness, with the result that he has left us with very little to say without repeating what he said. But that is not only true of us in this debate. If it were, we could not repeat what we said in our last debate. I was privileged to spend seven years as Director of the C.D.C. and therefore I know the C.D.C. pretty well inside out. Its Reports cannot vary very much. They may vary in figures, but otherwise they cannot vary very much.
To-night I shall confine myself entirely to the two points raised by My noble friend—namely, the Report by Mr. Sinclair and his colleagues, and also to the countries which have become independent. I did not go back to last year's debate; I went to the first debate we had, way back in 1947-48, which laid the foundations of this Corporation. There are those present who took part in that debate; I am pleased to see that some of them will take part in this debate. I was anxious to find out how far the C.D.C. had lived up to the expectations of those days. If the noble Lords will read the reports in Hansard of what was said in the House of Commons and in this Chamber they will see very clearly what the expectations were. It was thought that after a war which had exhausted our resources very much indeed, we ought to put up what our resources could afford, with the result that this organisation was set up.

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I notice that the heading in the 1960 Report, on page 7, "C.D.C.'s task," says this. Here I am going to repeat what was looked upon as the task in 1947-48, and I will read two sentences:
"Very great public attention has been given during 1960 to the political changes and problems in Africa and elsewhere. Never, therefore, has it been more important to help the economic life of the people of the countries where these events are taking place and to maintain the flow of investment. For several reasons C.D.C. can make an important contribution."
I thought to myself: what are the other changes which have taken place since 1948? In 1948, we had a Labour Government. I am sorry to say that we have not one to-day. We shall have one shortly, but not to-day. That is one big change. I am pleased to say that, though we have a different Government with a different outlook on this problem (and we should not expect a Conservative Government to have the same outlook as a Labour Government on a problem of this kind), we are united in our desire to see the C.D.C. doing a good job of work and living up to the expectations formed thirteen years ago. In those days—dealing with overseas problems, and with Africa in particular—the late Mr. Ernest Bevin, as Foreign Secretary, intervened in another place. At the time, I was overseas. I looked up his speech in Hansard, and I am anxious to quote what he said, which gives us a pretty good picture of what he saw for us overseas in the future. These are his words:
"We intend to develop the resources of the territories with which we are associated, to build them a system of priorities which will produce the quickest, most effective and most lasting results for the whole world."
And then he added these words—and very significant words they are to-day:
"We hope that other countries will do the same in association with us."
Well, we know that the reason for the situation in North Africa to-day is largely that other countries have not adopted a policy similar to ours in dealing with Colonial territories.
For myself, I do not quite understand why the Government shy at this idea of allowing schemes to continue in territories which become independent. They have, in the one breath, said: "Well. if a scheme has started, no matter how much of the scheme is incomplete, it can go on." I should like to give a hint to
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the present Chairman of the C.D.C. Countries emerge very quickly to-day from being colonial territories to independence. We may feel critical at a small minority of the natives who have had an education in this country, and have then gone back to disturb the vast majority. It is the activities of the small minority which account for the demand for political independence—I do not for one moment doubt that there is a lot of truth in that. But, after all, if we said to them now: "We will help you all we can, so long as you are colonial territories, but if you demand, and receive, political independence, don't forget that this source of income will be cut off," that is bound to create suspicion and distrust. So I very much hope that the Government will see their way clear to give further consideration to this point.
I thought that the Chairman of the Board gave a good example—I would say the best example I have ever known—of persuasiveness. He is obviously anxious, in view of the Government's statement on Lord Sinclair's Report, not to cause offence to the Government. And rightly so. His problem was how to express disagreement without causing offence, and I think he has done it wonderfully well. I should like to read a paragraph of what the Chairman of the C.D.C. said:
"It is essential for the Corporation to maintain the morale of its staff, its credit in London, its reputation in the regions in which it operates, and its regional organizations. The present decisions of the Government go a long way"—
listen to the persuasiveness here—
"to make it possible to do this, though it is hoped that reconsideration will be given in the future to the area in which the Corporation can operate, so as to enable it to undertake new projects in at least some former colonies which have become independent, or will become independent, and who may wish to continue in partnership with the C.D.C. as in the past."
My Lords, if that is not a good example of persuasion, I do not know what is; and if that does not bring the Government a little nearer to this conception, I do not know what will. I support my noble friend wholeheartedly in his plea for consideration of this question.
As regards the Report, I find my feelings expressed in an unexpected quarter, as we all sometimes do. All I need to do is to give your Lordships a quotation

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from the Economist of May 6, 1961, commenting on the Government's decision on the Sinclair Report. Here it is:
"It seems odd at a time when increasing amounts of money are being made available for overseas that the Government should continue to take a paltry attitude towards the Colonial Development Corporation."
The article goes on to criticise severely and concludes in this way:
"Just what has the Government got against C.D.C.?"
I wonder whether the noble Earl, Lord Perth, will give us the answer. May I repeat the quotation so that he will know what the question is.
"Just what has the Government got against C.D.C."
I cannot answer the question, but I am sure that the noble Earl can, and I hope that he will do so in this debate.
There is another question I want to mention, and with this I conclude. The Communists and the Communist countries are far more active now than they were thirteen years ago. They are seeking every opportunity they can find to try to influence policy in any country in the world, but especially at the moment in Africa. I am most anxious that we should do all we can to save the people of those countries from the misery that will ensue if they show the slightest indication of taking the help offered from some countries because help from this country is threatened. Yesterday, the Guardian had a good-leading article entitled "The southern neighbours", dealing mainly with Mr. Adlai Stevenson's tour of Latin America but including one or two general observations which I think we had better keep in mind, because we are in danger of thinking that putting money into a country is one way of keeping out Communism. Here is a very timely warning.
"It is by no means true, as the more ardent supporters of foreign aid sometimes seem to believe, that the economic development of a backward country necessarily weakens communism in the country concerned. On the contrary, it may strengthen communism."
It goes on:
"The economic development of a backward nation calls for self-sacrifice, discipline, and national unity: qualities which are hard to generate in any society, let alone a backward one, …"
If I have any criticism of the Corporation at all, it is on the lines of my noble friend's criticism of the attitude of the
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Government to the C.D.C. As to the work of the Corporation, we have to realise that there is some difficulty. From the Chairman and board of directors downwards to the lowest worker we have inside the Corporation, all are dependent to a large degree on the Corporation. They have done very fine work in the past. The board of directors are advisers to the Government on behalf of the Corporation, but we also have civil servants advising on the same problems, and sometimes their views are different. I know of questions—and the noble Earl knows that I know—on which we have felt that the civil servants were getting more attention from the Government and the Minister in charge than were the board of directors, who claim to know these problems, if not better than, certainly as well as, the civil servants. I know from my own experience that the Chairman arid Vice-Chairman of the Corporation were often consulted by the noble Earl and the then Secretary of State, but still I felt at the time that we did not count so much as we ought to count. I hope that the Government will realise that they cannot get better advice than that which they can get from the Board of Directors of the Colonial Development Corporation and will not rely only on the advice of civil servants inside the Colonial Office.
6.6 p.m.
THE EARL OF LISTOWEL: My Lords, my noble friend, with his inside knowledge of the Corporation, and my noble friend Lord Walston, who has made a most careful study of the matter, have said so much and with so much truth about the essential and urgent financial requirements of the Corporation that I shall add nothing on that subject. I would only ask the Government to give the House the fullest possible information about the future financial structure of the Corporation. In paragraph 3 of the Annual Report there is found the sentence:
"Consultations with the Government continue."
I understand that those consultations are now concluded and that agreement has been reached between the Government and the Corporation, but no full statement has yet been made in either House. I apologise to the noble Earl if a full statement has been made, but I do not think that a debate has taken

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place in either House on this subject, and it may be possible for him to amplify what I have no doubt he regards with justification as a full statement of policy about the financial structure and financial future of the Corporation.
I have nothing new to say, but I should like to drive home what I regard as far the most important point of broad policy in connection with the future of the Corporation. I think that it is vitally important and for that reason can bear repetition. The most important change in policy which we ask the Government to make is to give permission to the Corporation to operate in independent Commonwealth countries as well as in colonies and protectorates of the United Kingdom. No one who has lived and worked overseas can doubt the imperative need for capital investment in these new Commonwealth countries. It is just at the moment of independence that the need is greatest, because the fear of political instability prevents investments from other countries and the need for justifying independence urges these new Governments to go in for expenditure on social services and economic development on a bigger scale.
There is no alternative in the field to the Colonial Development Corporation. The Colonial Development Finance Company, of course, does excellent work but it cannot fill the bill, because its business is limited to lending money; and it cannot, like the Corporation, provide the managerial and technical skills which are needed and which cannot be provided locally for operating development projects. The reasons for extending the scope of the Corporation are twofold. They are the welfare of the Commonwealth and the welfare of the Corporation itself. The Commonwealth would benefit because most of the countries now on the verge of independence (leaving aside for the moment those that have obtained independence), are much poorer than their predecessors and those who have already got there, and are therefore in even greater need of the public capital which they require for developing their economic resources.
It is interesting to note from the last Annual Report that the two regions in which the Corporation has invested the
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largest amount of its capital are East and Central Africa. But, as we know, Tanganyika will be independent in December, and Kenya and Uganda are moving rapidly towards the same goal. It will be very serious for Tanganyika and Kenya if they are cut off from the Corporation as soon as they became independent. It may, of course, take Central Africa rather longer to reach the same distinction, but these territories in Central Africa will also be badly hit, as one sees from looking at the list of projects in the Corporation's Report, if they are cut off from the work of the Corporation, apart, of course, from the projects which have already been begun. Exactly the same argument applies, with equal force, in the West Indies, which we know will be independent in the course of the coming year. These are all poverty areas in the Commonwealth, and in all of them there is urgent need for a body like the Corporation which can put in capital for which private enterprise cannot take responsibility because the risk is too great.
Let us look now for a moment at the question from the point of view of the Corporation and the shrinking field of investment ever since our Colonies have become independent in succession, as they have done in the last four years. This shrinking, field will be progressively more harmful to the Corporation as more dependencies of the United Kingdom achieve independence. It will be increasingly difficult for the Corporation to show a profit. The field of its activity narrows and it finds itself limited to smaller and smaller numbers of small territories—strategic dependencies, island dependencies and other territories—which, for one reason or another, are not obtaining independence as speedily as are other dependencies.
The prosperity of the Corporation depends on the size and scope of its field of investment, and I believe the Corporation's staff is already alarmed by the prospect. It it likely to lose numbers of its staff if they become sufficiently frightened about their future. If the Government decide to alter their policy, as I hope they will and that we shall hear the welcome decision in the near future to allow the Corporation to go into the Commonwealth countries, it is no less important, although it seems a

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triviality, to change the name of the Corporation, so that it becomes the Commonwealth Development Corporation. Again, this may be seen most clearly from the receiving end. Having worked in Africa, I know how sensitive African countries are to the word "Colonial" and it might indeed happen that the Commonwealth countries would refuse the help of the Corporation unless it was dissociated, verbally and in title, from what they would regard as the imperial connection.
I think this debate has shown two things. One is the immense goodwill towards the Corporation from all Parties in your Lordships' House, and the second is that all Parties are asking the Government to do more to help the Corporation to carry on its good work. This, I think, is the first debate since Lord Howick of Glendale became Chairman of the Corporation, and I am sure your Lordships would wish him the utmost success in the immensely important work he has undertaken.
6.16 p.m.
THE EARL OF LUCAN: My Lords, I do not propose to repeat any of the points made by other noble Lords. The expected points were made about the financing and scope in the independent countries. Lord Walston said the case was unanswerable. The noble Lord was not here last year or the year before, and he for the first time will hear the noble Earl, Lord Perth, give the final answer, which we know is: if a country is worthy of political independence it is therefore automatically economically independent, whether it likes it or not, and therefore the Government are not going to give any help. I hope I may be wrong in that forecast. But Lord Walston may be sure there is a reply—we have heard it only too often.
I should like to refer to just one part of the Report, and that is the regional report of the High Commission, Territories. I have not given the noble Earl notice of this point, but the events of the last year have changed the position of the High Commission Territories. I think we have to face the fact that it is more important than ever that these Territories should be a shop window where we can display the best goods of the developing colonial territories before the eyes of South Africa. We should
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like to see economic developments going ahead in these Territories. The Corporation have certainly done a good job up to a point. In Swaziland I think their enterprise in the past has been fully justified. They have carried out basic developments which ought more properly to have come from Colonial Development and Welfare Funds. The water development produced an enormous irrigated area and the planting of forests—all this was done years ago—but now the benefit is being reaped, and we read, too, of the sugar mill operated in conjunction with the well-known Natal sugar firm of Sir John Hulett and Sons which has already begun a large output of sugar.
Wood from the forests has already begun to find its way to the pulp mill which is going to produce a large quantity of pulp. In Swaziland steps are being taken to establish the association of the Swazi people with these projects, and steps are being taken to facilitate the setting up of small holdings to improve agriculture. All this seems, at this distance, to one who has not been there, almost a model history of enlightened development. There the resources were to hand: the water and the population were there, and the climate was favourable. Bechuanaland and Basutoland are rather different. I think that the Bechuanaland story is good. The establishment of the ranch industry shows great promise in various parts of the South end of the territory. A large amount of money is involved. Of course, it has the ups and downs inseparable from an uncertain climate such as that of Bechuanaland, but it seems to be doing well.
Basutoland is the problem territory. However, it is extremely hopeful to read this year, for the first time, of some new initiative by the C.D.C. They have, I believe, proposed to the Basutoland Government the formation of a factory estate development company, to be jointly owned by the Government and the C.D.C. That is a most heartening development, which we hope to see grow. The water investigation—what I call the Oxbow Lake project—is continuing, but it is a long-term affair and it will be some time before it can come to anything.
It is often said that the C.D.C. would like to do much more in these High

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Commission Territories but that the resources are just not there. So far as minerals and other resources go, that is, of course, true. But we have had the Morse Report, which was published last year and to which I should like to draw the attention of the Government and, indeed, of the Corporation. There is in that Report a clear indication that the Colonial Development Corporation could help considerably. In the case of Swaziland the Report says that what is wanted is
"development to help create conditions in which the known resources can be exploited to the best advantage of the territory".
In the other countries there is basic development and investigation still to be done. I agree with my noble friend Lord Walston when he says that if there is capital to be spent in association with other interests, why spend it on hotels in the Caribbean and housing developments in Malaya or elsewhere, where no doubt other interests would be ready to step in and provide these facilities. These territories are places where the money is most urgently required, and they are countries which we have to admit are backward economically. We have not in past years developed them in the way that we should.
We read in the Morse Report that in regard to Basutoland they strongly recommend
"that measures be taken to provide one or more factory areas in which industrialists can be given legal title to leasehold sites at favourable rates".
They also point out that the rivers and electric power could be a big factor in improving the economy of Basutoland. Both water and electric power, rising or generated in Basutoland, would find a sale in the Union; and this is the type of project that has been carried out successfully by the C.D.C. before now. I would strongly recommend to the Corporation, in spite of what we have been told over the years, that there is scope for just those things, as is mentioned in the Morse Report. To my mind, this is the area of the world where it is most urgent that we should show results.
6.26 p.m.
THE MINISTER OF STATE FOR COLONIAL AFFAIRS (THE EARL OF PERTH): My Lords, we undoubtely owe
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a debt of gratitude to the noble Lord, Lord Walston, for introducing this debate this evening on the 1960 Report of the Colonial Development Corporation. The noble Lord said much that is of great value, but also much with which I do not agree; and that is both to be expected and valuable in a debate. Then, I recall the noble Lord, Lord Macdonald of Gwaenysgor, who said: "What have the Government got against C.D.C.?" I hope to show in my speech as I go along that the Government have nothing against C.D.C. Far from it: the Government believe in the C.D.C. and do all they can to help them forward in their work.
The noble Lord, Lord Walston, referred to the noble Lord, Lord Twining, and his crystal ball. I am not sure that Lord Twining was a very good soothsayer, or whoever it is who looks into crystal balls. I will endeavour to show that what the noble Lord said about the Sinclair Report—namely, that we had not got on with their recommendations—is just not the case. We have done so. The noble Earl, Lord Listowel, asked that I should go into some detail on this question, and I should have been glad to. But the fact is that a full statement of Government policy in regard to the Sinclair recommendations through the C.D.C. was made in another place, on a Monday when this House was not sitting, and I would refer the noble Earl to that statement of April 27, 1961.
THE EARL OF LISTOWEL: My Lords, I am quite satisfied with the suggestion of the noble Earl. I should not wish him to weary the House with a statement that can easily be read in the Hansard Report of another place.
THE EARL OF PERTH: I thank the noble Earl. I was not intending to go into great detail, but I think it is useful to take up the point of the noble Lord, Lord Walston, that we have not followed out the Sinclair Report in any of its main points. As I shall try to show, this is just not the case. What was the essence of the Sinclair Report? In paragraph 59 they made three proposals. The first was that there should be "A" stock representing loans advanced for "finance house" business. That we have agreed to. There is to be "A" stock with matching terms for capital repayments for all types of loans. They

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wished it only for Government loans. In regard to the "C" stock, they.suggested that there should be "C" stock helping certain losses and a certain measure of fructification interest. At that time the figure was about £15 million, and by the time we made our recommendations it was up to £20 million. We have followed the recommendation for "C" stock, both for the abandoned schemes and for fructification interest. We have laid down that repayments for "C" stock should take a slightly different form. It should take the form of repayment in the event of the Corporation, after its various obligations, having a profit over £250,000.
I am going to touch for a moment on this word "profit", because I think the noble Lord, Lord Macdonald of Gwaenysgor, seemed to indicate that at times in the past, anyhow, there had not been a very good relationship between the Government and the Corporation. Historically, and in some degree, that was perhaps true, but I certainly think that the advice that the civil servants, as he put it, had been able to give from time to time has been of the greatest value. I think nobody would say that they have all the wisdom, but if they get advice from various civil servants who have done great work on these things that, I am sure, adds to the whole.
The point I want to make is this. There was obviously some query in our minds about who should determine what were profits. We all know how easily you can dispute or arrange things so that profits may be bigger or less. This question naturally arose. We took the line with the Corporation: "Look here, we know that you do the thing in the right kind of way, and we leave it to you. We will have a look at it in three years, but in the meantime it is for the Board of the Corporation by and large, to decide." I mention that as an example of the good relationship there is to-day between the Government and the Colonial Office.
The third recommendation was that there should be "B" Stock—and here there is a variation—which had no fixed rate of interest, with a maximum of 5 per cent. That, we felt, we just could not follow. The reason was that that meant there would in fact be a fluctuating subsidy—and I stress the words "subsidy" and "fluctuating" o the Corporation,
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year in and year out, over which Parliament would have no control. Surely, one of the important things is that Parliament should have control over the funds it votes. If there were this form of fluctuating subsidy, there would be no control. Therefore, we accepted the idea of the "B", stock but we said, "No, you must continue to pay whatever the rate is for 'B' stock, but as those investments will be for equity investment we are ready to continue with the fructification period for seven years for those investments". That was the only variation from the Sinclair Report.
There was one other suggestion—namely, that there should be a reserve or an allowance for exploration, and that sort of thing. We have covered that in a different way, in that the Corporation is allowed the first £250,000 of its true profits for whatever purpose it likes, which obviously would include such things as exploration. I want to say once again how greatly indebted we are to Lord Sinclair and his colleagues for the Report which they put out quite a long time ago. It was of the greatest value to us, and I have endeavoured to show your Lordships that we have largely followed the advice that they gave. I will make just one other point. We were doubtful whether we should have to have legislation to give effect to the recommendations. But we shall not have to do that.
Now we come to the second point of the crystal ball—that there will continue to be a demand for more funds. It is true that various noble Lords have said that perhaps the Corporation needs more funds, or should not be starved of funds. But the fact is that at the moment the Corporation is not in need of funds. I must be quite frank with your Lordships: even if it were, there would be the greatest difficulty for two reasons. One is that we have always visualised this as a revolving fund. If you have a figure of £150 million, then so much is made in every year from the various loans that have been made. One hopes that the Corporation from time to time, in its successful ventures, will sell them off. So there is no reason why, from that angle, one should worry. Then there is the other angle, that we are to-day in great trouble on our balance of payments, and we simply cannot afford to go beyond

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a certain point in what we can make available. Here I think I might quote the words of the Chairman when talking about this aspect. He said:
"It is not the immediate problem which is 'needling' us to-day."
Then we come to the third question, which is that of the independent countries. To that extent, the crystal ball was right. We have had this debate, and one noble Lord after the other has raised the question of our extending our operations in the independent territories. I deliberately use the word, "extending" because I think noble Lords are apt to forget the extent to which paragraph 6 of the Report shows how the Corporation is to-day operating in the independent countries. As your Lordships know, it can, and does, continue in the ventures in which it invested before these countries became independent. Indeed, it can put in more money if it is needed for an exceptional extension, and, of course, it is always possible (noble Lords seem to forget this) for an investment to grow on its own. There is nothing to stop them putting some of that money back into the normal development of whatever the venture may be.
Apart from doing it in particular projects, they have recently set up various development corporations. If your Lordships look at paragraph (6) of the Report, you will see that brought out. There are development corporations in the three regions of Nigeria. They take a part in the Federal Development Corporation of Nigeria. There is a Development Corporation in Sierra Leone, and also one recently set up in Malaya.
The reason I mention this is because with these Development Corporations they are still able to play a part, maybe at times limited, although at this moment they still have in several cases a good deal of money left. Perhaps the important thing is that the staff which are there can take their part in the Development Corporation and, furthermore, as your Lordships know, it is always open, if anybody wants it, for the staff to be made available on an agency basis. Therefore, on this question of extending the operations, my first point is that there is already a considerable activity in these various territories. I am not going to give the answer which the noble Earl, Lord Lucan, said I generally give
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on this question. I have thought out some other and, I think, convincing reasons apart from this one.
There is one further point—namely, the point about the demands of the remaining colonial territories. Given our balance-of-payments difficulties, this is a very real point. The noble Earl, Lord Lucan, spoke importantly about the High Commission Territories and the Morse Report. There is one more example of the pressing needs of the remaining territories for help. I am quite sure that the Chairman of the Colonial Development Corporation, Lord Howick of Glendale, who is here to-night, will not only have listened, but will have carefully noted what the noble Earl has been saying, more particularly, if my memory is right, because he was at one time High Commissioner to those territories, and therefore, if I may put it this way, he has a natural bias in their favour. I think it is a valuable thing to have brought it up, and I am quite sure the words will not go unheeded.
Having said this, I recognise that the Colonies are happily—if that is the right word to use—shrinking in their numbers. Shortly, we are to have Tanganyikan independence, and my hope and expectation is that we shall see the West Indies achieve independence next year. There will one day arise the fact that there are not perhaps the number of territories left which give sufficient scope. While I am quite clear that the present arrangements are right for the time being, as my right honourable friend said in the debate on April 27, these arrangements will have to be reviewed in the future. That, if I may put it, is one point to remember. The other one is this: that we intend—
THE EARL OF LISTOWEL: My Lords, may I ask the noble Earl, before he goes from that point, whether, when he speaks of the future, he means the near future or the foreseeable future? Because that word can have a very remote connotation.
THE EARL OF PERTH: I think it has to be related to the time when the various colonial territories which are left are small in scope or in number.
THE EARL OF LISTOWEL: I am sure the noble Earl appreciates that we should like him to convey to the Secretary of State, in regard to this matter, that we

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hope that it will be reviewed urgently. We do not think the Corporation can carry on until its field of operations has dwindled to a small number of very poor Colonies.
THE EARL OF PERTH: I understand the point, but I am endeavouring to show that we do not think it right to worry too much over it at the present time. The arrangements will have to be reviewed in the future. Another point which I would make is that we know that the Corporation should go on—the point which the noble Earl made. Clearly, if it were a dying body, that would be bad from a staff point of view, and generally one could not allow such a situation to develop. But, having said that., I think there is a certain amount of misunderstanding about this point—that because there may be less scope, therefore the staff is going to disappear. I remember last year raising the same point. For the staff to remain it is not necessary for there to be new ventures all the time. The fact is that when you start ventures, very important ventures, and you have just to look at the outline in the Report to see how many ventures there are, you must have staff to deal with them. The idea that because you are not necessarily going to widen the scope therefore the staff will have to go is not well-founded. As 1 say, the problem is not an easy one.
We have the problem of balance of payments to-day, the fact that the Colonies themselves are still very hungry and that there is lots of work for the Corporation to do. Then one runs into the problem which the noble Earl, Lord Listowel, in a sense touched on when he said we must change the name, because other Governments may not like it. I think one has to go further back than that and look behind the name. There may be problems, and there will be problems, at times when the British Government, disguised or not, is in fact running something which is of great importance to an independent territory, and which really affects its well-being; something like an electricity undertaking or other public utility. I am not saying that this difficulty is insoluble; I am saying there are problems. It is not just a question of changing a name in relationship to a British-owned venture in an independent territory which may
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have particular importance to the territory's well-being. Let me leave it at that. There are, if I may repeat them, two proposals: that one day arrangements will have to be made to review the situation, and that we clearly would wish that the Corporation should go on. My last thought to-day is that I am quite clear that it is right to do what we are doing and to concentrate on the remaining colonial territories.
I have tried to cover the various points in the crystal ball and I will now very briefly touch on one or two points in the Report itself. I, with the noble Lord, Lord Walston, rejoice in the progress that is shown in the Report and in the results, which are, I think, fully satisfactory. So far as one can judge on these things, they are very much the same as those of last year, when one takes into account that there is a bigger profit but also a larger amount of money invested and a greater need to pay interest on what was borrowed from the Government. So that, really, very much like last year, they broke even; and I think that is a very satisfactory result. It is quite true, as the noble Lord, Lord Walston, said, that apparently the direct ventures they have gone into have not done quite so well this year as last, but if he would look at the Report he would see that the main reason was that one of the ventures in which they had a direct interest last year, namely, the Lobatsi Abattoirs, is no longer part of the Corporation's direct activities and is not fully owned. I am quite sure the noble Lord will welcome the reason why it does not appear as a direct participation. It has been taken over by the Bechuana Protectorate and the Bechuana Livestock Producers Trust, those who are primarily interested in producing beef.
One has to look carefully at these figures. When we come to the question which he raised, whether we like direct or solo projects and what is the Government's attitude on them, I think my answer is that on the whole we do not like them. We do not like them for the reason that we think it is much better that the Corporation should go into partnership with some other interests. There are various reasons for that. For example, if you can get a partnership you are bringing more money into the development of the territory. But we

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certainly have no hard and fast rule which would lead us to say, "Because it is solo, therefore you cannot do it." I think we have to look at each case; but there is, I must be frank, a bias against solo operations unless there is good reason for it, if I might put it that way.
I will take up one particular point which the noble Lord, Lord Walston, made and I think it was repeated by the noble Earl, Lord Lucan about the Corporation's going into hotels or houses. In many of these territories an hotel is an absolutely vital thing for its wellbeing and for its development. If there are no hotels, people will not go. Again, the Corporation have found that, without their taking if not the whole at any rate the leading part in financing the construction of hotels, nobody will go and do it. So I can assure your Lordships that many of these colonial territories welcome, and are most anxious to see, the Corporation doing it, because nobody else will do it; and the same has been true of financing the building of houses. The Corporation has particular expertise on houses. As you know, building societies from here are not permitted to invest overseas, but the Corporation are, and they have done a great deal to help housing schemes. And when they can, for example, bring in some big insurance company, that is good. Very often what one finds is that these big companies say: "We do not know the territory well, but if you come along with us with you local knowledge and so forth, that is fine." That is also why we find them in the cement business and even the fertiliser business, which the noble Lord mentioned.
What else is there on the Report? I think it is very satisfactory. It shows fairly well-spread investments through the different regions. A new feature in the Report which I personally welcome very much is that of showing the results in the sense of the return that they get on their investment in each one of the regions. It is noticeable that, except for one of them, I think the one in the Far East, they are not making a return today in any one of them which matches the amount they have to pay for the money that has been advanced to them.
One has always to bear this in mind: that while the Corporation has done very
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good work—invaluable work, the Report says, and we all know we must not lose sight of the fact—to date it has been a costly performance. That is to say, £20 million has been put into C stock. One day let us hope all of that will be regained. But I think that we ought not to lose sight of the fact that there is a minus side to it all, and that while it is doing fairly well on the task of breaking even one year with another, it is not all honey.
Looking at one or two other things in the Report, I think it is very welcome to see the cases of participation with outside interests. The outstanding example is the Kilombero Sugar Company in Tanganyika, in which you get the International Finance Corporation of Washington, which is connected with the World Bank, two Dutch companies and a bank all having an interest. It is an excellent thing when one finds them arranging a scheme and getting local farmers and local participants in it. All of that is extremely good.
The noble Lord, Lord Walston, picked out one sentence about delays. I am not sure of the facts, but I am quite confident that if there is delay there is good reason for it. If you look at the Report, you will find there the thanks given to the Colonial Office for all the help they have given the Corporation this year, and I can assure you that the number of cases of delays are very few indeed.
Noble Lords very rightly drew attention to the scholarships and local training. I am all for that. But I think we must be a little careful of our enthusiasm and not look on this as a way of teaching, when the right way of teaching in many instances is, of course, through the Technical Aid Department which is being set up. I should not be at all happy if I saw a large number of scholarships, because it is not appropriate; it is not the job of the Corporation. It is its job to give training and an occasional scholarship for particular people who are going to work on their particular projects.
Before I close I might say one personal word. I was recently in both Sierra Leone and Gambia. When I was in Sierra Leone I did not stay but I had meals in the most excellent hotel, the Freetown Hotel, which is the new hotel, the pride of Freetown. We had the

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State banquet there; it was remarkably well done. If it had not been for the Corporation I do not know what the Government would have done. The other thing that struck me was the considerable shortage of water. Just before independence, a scheme for the Guma Valley Waterworks was announced and the Corporation is playing a leading part in finding some of the money, as is what I call the sister Corporation, the Commonwealth Development Finance Company, which is private enterprise. Then I went on to Gambia. In the Gambia is one of the saddest stories, or at least one that is always quoted—the Gambia egg scheme. That was a very unhappy affair, but the people of Gambia have in fact put it to very good use, because although the thing is finished as an egg scheme there were a lot of very fine buildings left, and those buildings have been converted into a teacher training college at Yundum, so that good has come out of the egg.
Again I went over the big rice scheme they had there, which was a very ambitious scheme with irrigation for getting two crops a year, and so forth, and on that scale it did not work. But they did a lot of work in building the bunds, and training staff and clearing the ground. One saw a good deal of rice being grown, not on the highly developed basis originally planned, but the scheme continues with the help of one or two people who had originally come out for the work. There again something they left behind has proved of great value.
This Report is in a sense the record of the work of the last Chairman until Lord Howick of Glendale took over, Sir Nutcombe Hume, and I think it is appropriate for me to pay a special tribute to him. He was an original member of the Corporation, one of the first members of the Board in 1948; then in 1953 he became Deputy Chairman and in 1959 he was Chairman. He brought with him his great experience from the City, both on financial matters and on management. I think his particular concern was management; he knew that this was the key to success. Of course, management means the well-being of the staff, and I know that he and Lady Hume, in the many travels they undertook to the various countries to see the schemes or Projects of the Corporation, used to do a
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great deal from the staff point of view to encourage them and to build them up. As I say, I think we all owe a great debt to him. Now we have the new Chairman, the noble Lord, Lord Howick of Glendale, who happily is of this House, and I know and you know the Corporation will continue in its successful way. It has done very well this year. One's hope is that with the new organisation, largely on the lines of the Sinclair Report, it will get new encouragement and will be able to do even better things than heretofore.
6.57 p.m.
LORD WALSTON: My Lords, I am glad that there have been those other noble Lords who have spoken and shown their interest in the affairs of the Corporation, and I am most grateful to them for the part they have taken, as well as to the noble Earl for his very comprehensive, if not always entirely convincing, answers. My regret is that the speeches, for some reason or another, have all come from this side of the House; and while I know that there are some people more willing to respond to blandishments by beckoning from ahead there are others who respond more readily to proddings from behind. It might have been as well if we had a few more proddings from behind as well as beckonings from ahead.
I would associate myself with what the noble Earl said about Sir Nutcombe Hume. It is clear that the success of the Corporation is in very large measure due to his leadership and work. It is not, fortunately for your Lordships, as well as for myself, the custom for me to reply in any detail to what has taken place during this debate, so I will forgo that temptation—and a very strong temptation, I must say, it is. I might diffidently suggest that perhaps the noble Earl and I might continue under the Chairmanship of the noble Lord, Lord Howick of Glendale, the discussion as to whether the Sinclair Report has been implemented or not. He would undoubtedly be a very independent chairman and I should be quite confident and happy to submit myself to his ruling.
The noble Earl spoke of the need for extra capital and said this was meant to be a revolving fund and therefore there should be no need for more capital. There

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are only one or two points I would make. The first is that shortly afterwards he referred to the pressing need of money on the existing projects, which suggests that he himself is not entirely happy about the money available. If the Corporation cannot do two or three things but must choose to do one, it is clear that money must be short.
THE EARL OF PERTH: Might I just make clear that it is not because of money shortage to-day that things aye not going forward. Quoting from what the Chairman said about this, I said it is not their immediate and pressing problem.
LORD WALSTON: I accept that. I know that there is still available £35 million. I was quoting the noble Earl's reply to my noble friend Lord Lucan, when he suggested that things were not to be done to implement it, because of the pressing financial need of other projects that could not be undertaken. But I would ask him to remember that the figure of £150 million was arrived at a good many years ago. Since then we have had quite a degree of inflation. If £150 million in terms of those days was the correct amount, surely there is an argument for increasing it at least by the amount by which the. £ has been devalued since then. At a rough guess, another £30 million or £40 million would bring it up to the figure originally intended.
I fully appreciate what the noble Lord said about the setting up of development corporations in former Colonies. I think that that is a fairly good "wangle" —quite a reasonable way of getting round a difficulty. It is rather like joining a club so that you can get a drink after hours, because you are not allowed to go to a pub; or, if you want to ply for hire with a taxi but are not licensed by the Metropolitan Police to do so, you invent the minicab. These are ingenious ways of getting round things; but I do not think it is quite in keeping with good government and the desire to help in this important matter, that the Colonial
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Development Corporation should be forced into these somewhat devious though perfectly respectable ways of getting round the difficulty, when there is a so much simpler and more effective way of doing it.
I am most grateful to the noble Earl for the faint ray of hope that he gave in not replying in the terms in which my noble friend Lord Lucan suggested that he might in regard to the suggestion of changing the name "Commonwealth" and extending activities to the Commonwealth. I am grateful for the ray of hope that he gave that this was being considered. We hope that when he speaks of calls in the future for review of the arrangement, that that will be in the relatively near future, especially in view of the points that have been raised by noble Lords in the debate.
Finally, I should like to take up the noble Lord on his remarks about the costliness of this undertaking—he told us that £20 million has been lost. It has not been irrevocably lost, even in financial terms. As he himself gave as an example, good may yet come even out of the Gambia experiment. But even if it has been lost, surely with the achievements of the Colonial Development Corporation over these years, if the cost to the country was no more than £20 million, I think that we should willingly pay that for the results that have been achieved. In addition to that, we have the sound investments which are in fact paying interest. In those circumstances, I think it is misleading to say that this has been a costly experiment. I am most grateful to all noble Lords for taking part in the debate, and I now beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

BIRMINGHAM CORPORATION BILL
Returned from the Commons with the Amendments agreed to.
House adjourned at four minutes past seven o'clock.