Sitting of 25 March 1919

Preamble
The House met at a Quarter before Three of the clock, Mr. SPEAKER in the Chair.

PEIVATE BUSINESS.
Private Bill Petitions (Standing Orders not complied with),—Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That, in the case of the Petition for the following Bill, the Standing Orders have not been complied with, namely:
Llanelly Rural District Water.
Ordered, That the Report be referred to the Select Committee on Standing Orders.
Private Bills [Lords] (Petition for additional Provision) (Standing Orders not complied with),—Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That, in the case of the Petition for additional Provision in the following Bill, originating in the Lords, the Standing Orders have not been complied with, namely:
Middlesbrough Corporation Bill [Lords].
Ordered, That the Report be referred to the Select Committee on Standing Orders.

ORAL ANSWERS TO QUESTIONS.

  UKRAINE.
  Sir S. HOAREasked the Secretary of State for Foreign Affairs whether he can make a statement as to the state of affairs in the Ukraine?
  The UNDER-SECRETARY of STATE for FOREIGN AFFAIRS (Mr. Cecil Harmsworth): The present situation in Ukraine is too obscure to enable me to give the hon. and gallant Member any very definite information on this subject. The Government of Petlyura is, however, reported to have collapsed before the forces of the Russian Bolshevik Govern-
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  ment, who have advanced in certain sectors. There is no immediate danger to Odessa, and there is no intention of evacuating the town. So far as the Allied forces are concerned, they are under the control of the French command, who are taking the necessary measures to deal with the situation.
  Sir S. HOARE: Will the hon. Gentleman consider the possibility of sending a Political Commissioner in addition to the Military Commissioner who is already at Constantinople?
  Mr. HARMSWORTH: I will consider it.
  Colonel WEDGWOOD: Are there any British soldiers there?
  Mr. HARMSWORTH: I should like notice of that question.

  SOLDIERS' BODIES (EXHUMATION).
  Major COHENasked the Secretary of State for War whether bodies of soldiers are to be exhumed and transported by rail to other burial grounds; and whether, if this is the case, facilities will be given to relatives to have the bodies brought home to England?
  The SECRETARY of STATE for WAR (Mr. Churchill): No. Sir; there is no intention of exhuming the bodies of our soldiers and transporting them by rail to other burial grounds. The only exhumation taking place is in the case of isolated graves, the bodies in which are being collected into cemeteries in close proximity to the graves. I regret that I can hold out no hope whatever that the facilities asked for in the latter part of the question will be granted.
  An HON. MEMBER: Does that apply to soldiers who are buried in Germany?
  Mr. CHURCHILL: No; not necessarily.

  DEMOBILISATION.

    ARMY FORM PRINTED IN COLOGNE.
    Mr. BOTTOMLEYasked the Secretary of State for War whether he is aware that Army Form Z 30 M (Soldier), which is distributed among men about to be demobilised, bears the imprint "Printed in Germany by Fr. Massing, Zulpich, 12.18";

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    and, if so, what is the explanation of the employment of a German firm in connection with work of this character?
    Mr. CHURCHILL: My attention had already been drawn to this matter, and full inquiries made. Owing to transport difficulties and the necessity for giving priority to food, etc., sufficient supplies of forms could not at first be sent up from the bases in France, and as certain forms were urgently required to facilitate demobilisation, small quantities were printed in the district of Cologne. This is now no longer necessary.

    RELEASE POSTPONED.
    Lieutenant-Colonel Sir NORTON GRIFFITHSasked the Secretary of State for War whether he will issue Army Orders to the effect that no officer or soldier eligible for demobilisation shall be liable to have his release postponed by his commanding officer, or any other authority, on the grounds that he cannot be spared from military service?
    Mr. CHURCHILL: Soldiers who, though eligible for demobilisation, are temporarily required for the military machinery of demobilisation are liable to be regained until they can be individually replaced or their services dispensed with. I regret my hon. and gallant Friend's proposal for altering the Regulations at present in force cannot be entertained.

    MEN ATTESTED IN 1915.
    Lieutenant-Colonel Sir N. GRIFFITHSasked the Secretary of State for War whether the Derby men who attested in 1915 and were not called to the Colours until 1916 are included in the new scheme of demobilisation and are liable to demobilisation as 1915 men in accordance with the terms of their attestation, Form B 2,512a, in which it is set forth that their service shall begin to reckon from the date of their attestation; and whether, if this is not so, he will take immediate steps to have these men included in the demobilisation scheme?
    Mr. CHURCHILL: The answer to both parts of my hon. and gallant Friend's question is in the negative.

    DOCTORS AND NURSES.
    Mr. LEONARD LYLEasked the Secretary of State for War what are the latest orders he has issued for the demobilisation of additional doctors and nurses
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    still attached to the Army; and what steps he is taking to release medical men who are now serving in India, and whose practices are suffering from their long absence?
    Mr. CHURCHILL: Orders have been issued that medical officers shall be released from all theatres of war immediately it becomes possible to dispense with their services, and that the number employed shall be reduced in proportion to the reduction in other arms, as far as the large areas occupied and the wide distribution of troops in enemy territory permits. Orders have also been issued to the effect that all nurses shall be released immediately their services can be spared. During the last ten days considerable numbers of doctors and nurses have been demobilised. As regards those officers serving in India, the peace establishment, which is composed of Regular Army officers only, is being adjusted as quickly as circumstances permit and 100 Regular officers are on their way or are awaiting early passage.

    COMPASSIONATE GROUNDS.
    Mr. BETTERTONasked the Secretary of State for War whether, in the consideration of cases eligible for demobilsation on compassionate grounds, he will give directions that the claims be considered of those repatriated prisoners of war who have suffered specially harsh treatment or who have been compelled to work immediately behind the enemy lines?
    Mr. CHURCHILL: I would refer to the answer given to my hon. Friends the Members for Kettering and Bishop Auckland on the 25th February, to the effect that it would not be right to confer a privilege upon repatriated prisoners of war as against their comrades in the fighting line. It is not possible to appraise the relative sufferings and hazards endured. If men are fit in bodily health they must be treated alike, according to the age and categories prescribed.

    ROYAL ARMY SERVICE CORPS (FORAGE DEPARTMENT).
    Sir ARTHUR FELLasked the Secretary of State for War when the Forage Department of the War Office is to be closed down and when the men of the Royal Army Service Corps attached to the Forage Department are to be demobilised; and if he is aware that practically none of these men have been discharged up to the present time?
    Mr. CHURCHILL: I am informed that the Forage Department is being demobilised as rapidly as the lifting of the remainder of the hay purchased and required by the Army can be completed. One thousand seven hundred and thirty-five men have been demobilised, and 3,325 men and women of the Forage Department Corps have been discharged.
    Sir A. FELL: Can something be done with regard to hayricks which have W D put on them and which have not been paid for by the Department?
    Mr. CHURCHILL: I should like to have notice of that question.
    An HON. MEMBER: Will there not be an increased supply from France this year?
    Mr. CHURCHILL: I do not think I should have a question of that sort put without notice.

    RE-ENLISTED MEN.
    Major Earl WINTERTONasked if men who enlisted in 1915 were then discharged and re-enlisted under the Compulsory Service Acts of 1916 can be treated as if they were enlisted men from 1915 as regards eligibility for demobilisation if they fulfil the age and wound stripes conditions?
    Mr. CHURCHILL: Men who enlisted prior to 1st of January, 1916, and who actually performed continuous service with the Colours and were discharged medically unfit on account of wounds or ill-health prior to that date, and who were again enlisted after that date are eligible for demobilisation.

    SOLDIERS SENT TO RUSSIA.
    Lieutenant-Colonel Sir F. HALLasked the Secretary of State for War whether he is aware that a considerable number of men who joined the Service in 1914 and 1915 have been sent from Salonika to Russia; whether he is aware that in practically every case these soldiers have had no leave to enable them to visit their homes; and whether, in view of the great dissatisfaction that has arisen in consequence thereof, he will immediately take steps for these men to be released and their places taken, if necessary, by younger soldiers?
    Mr. CHURCHILL: It is posssible that amongst the men sent from Salonika a certain number, but not a large number,
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    who joined in 1914 and 1915 are included. The order of priority of demobilisation, which applied to our forces at home and on the Continent, is also operative in the Army of the Caucasus, and under this system the length of service of such men receives consideration, and their claims have not been lost sight of. These men will be replaced as soon as possible.
    Sir F. HALL: If I bring to the notice of my right hon. Friend specific cases, will he have them looked into with a view to these men being returned?
    Mr. CHURCHILL: Yes, Sir; I will. The policy which we are pursuing is to replace these men and to bring them home as soon as possible. If they are entitled to demobilisation we try to demobilise them. At the same time we have to think of the actual condition of each unit. We cannot break up a unit which is required for service until we can find some means of replacing the men.
    Sir F. HALL: Cannot that be done by young men being sent out?
    Mr. CHURCHILL: That is exactly the process on which we are engaged. Recently drafts have been sent out.
    An HON. MEMBER: Why send men to Russia at all?
    Mr. CHURCHILL: That is a question which should be addressed to the Head of the Government, the Leader of the House, or the Foreign Secretary.
    Commander BELLAIRS: Will the right hon. Gentleman look into the case of twenty-two men from whom I have received a letter to-day, who have been in hospital with malaria, have had no leave, and have been sent out abroad again?
    Mr. CHURCHILL: I must ask for particulars of these cases.

    GUARDING GERMAN PRISONERS.
    Colonel MILDMAYasked whether non-commissioned officers and men, admittedly entitled to demobilisation on account of their age and length of service, are rightly retained when in England to guard German prisoners, on the plea that they are temporarily required for the military machinery of demobilization?
    Mr. CHURCHILL: Instructions have already been issued for all men serving in the Royal Defence Corps, which normally

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    provides guards for prisoners of war in this country who are eligible for demobilisation to be replaced. I will have inquiries made into any specific cases which my hon. and gallant Friend may have in mind.

    ONE-MAN BUSINESSES.
    Lieutenant-Colonel Lord HENRY CAVENDISH - BENTINCKasked the Secretary of State for War whether, in view of the hardship suffered by being retained in the Army by one-man business men who are in many instances qualified for demobilisation, he will immediately release all such men. whether qualified or not, who can prove that their businesses are suffering by their absence with the forces?
    Mr. CHURCHILL: Such men as are eligible for demobilisation are being demobilised as rapidly as the exigencies of the Service permit. I regret my Noble and gallant Friend's proposal to release men who are not eligible cannot be entertained.
    Lord H. CAVENDISH-BENTINCK: Cannot my right hon. Friend feel any compassion for men whose business has been ruined and whose prospects in life have been damaged?
    Mr. CHURCHILL: Yes, Sir; there is machinery for dealing with compassionate cases, and the construction put upon compassionate cases may be made more liberal as time advances. As I have frequently explained, we have had to make a rule and to stick to it.
    Sir J. BUTCHER: Would the right hon. Gentleman reconsider the ground of compassionate release so as to bring in many of these undoubtedly hard cases of one-man businesses?
    Mr. CHURCHILL: I have several times said to the House that the Army was greatly unsettled by the policy of picking and choosing, and it has been greatly steadied by the introduction of rules which, though they seem very hard in individual cases, commend themselves to the sense of justice of the ordinary serving man. It may be that in a few months, perhaps earlier, it may be possible to make some mitigation of our present system of release, and I will most carefully consider in what way it may be made possible so as to give the greatest amount of satisfaction.
    Lord H. CAVENDISH-BENTINCK: Has not the time arrived when some mitigation might be granted?
    Mr. CHURCHILL: No.

    CLOTHING.
    Mr. HAYDAYasked the Secretary of State for War whether upon demobilisation a soldier is entitled to an issue of underclothing, boots, and cardigan jacket; and, if not, will he consider the advisability of supplying such articles in view of the fact that many of the men on demobilisation are wearing articles that have been in use for over two years?
    The FINANCIAL SECRETARY to the WAR OFFICE (Mr. Forster): Under the instructions issued, soldiers on demobilisation are to be in possession of thoroughly serviceable clothing, including underclothing, boots, and cardigan jacket. Owing to the rapidity of demobilisation and the large numbers affected cases may have occurred in which articles of underclothing or boots should properly have been exchanged before the men left their units, but I can assure my hon. Friend that no efforts have been spared, both in France and in this country, to ensure that the men were adequately clothed on dispersal.

    MACHINERY OF DEMOBILISATION.
    Mr. HURDasked the Secretary of State for War why Corporal A. G. Ruck, No. M.S./30004, Royal Army Service Corps, No. 13 General Headquarters Reserve, Mechanical Transport Company, British Expeditionary Force, and Private R. H. J. Barfoot, No. 457137, Royal Army Medical Corps (Territorial Force), 11 bis, Rue Christophe Colombe, Paris 8, who both joined the Army in 1914, are not now released under the demobilisation scheme; whether the number of 1916, 1917, and 1918 men being retained in the Army of Occupation are sufficient for the military machinery of demobilisation under Army Order 25; and whether he will call for immediate reports from the commanders of units in the Army of Occupation to ascertain whether many 1914 and 1915 men are being unnecessarily deprived of release under the Government promise?
    Mr. CHURCHILL: If the dates of these men's enlistments are as stated they would appear to be eligible for demobilisation, and, if so, will no doubt be released in due course. There is no reason to believe that

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    men who are eligible for demobilisation are being unnecessarily retained, but men whose services are temporarily required for the military machinery of demobilisation are liable to retention until they can be replaced or their services dispensed with, notwithstanding their eligibility for demobilisation; every effort, however, is being made to replace men so retained as early as possible.
    Sir E. CARSON: Who decides the necessity of keeping them?
    Mr. CHURCHILL: In regard to the men who are required for the machinery of demobilisation, and in regard to those units which are required for the purposes of demobilisation, it would come from the War Office, but in individual cases, which are not covered by the general rule, the commanding officer would be the authority in the first instance.
    Captain SPENDER CLAY: Did not the right hon. Gentleman say, in giving a previous answer, that the commanding officers had no right at all?
    Mr. JOYNSON-HICKS: Can the right hon. Gentleman give us some guide as to whom Members of Parliament should apply? Is he aware that I have written to him of nine or ten separate cases of men entitled to be demobilised within the last month, and I have not got one released yet?
    Mr. CHURCHILL: All I know is that since the beginning of the year about 2,250,000 men have been demobilised. That, to me, seems to be a prodigious thing.

    ARMY WITHDRAWAL (FRANCE).
    Sir A. FELLasked if a statement can be made explaining the nature of the withdrawal of the Army from France; and if the map in the Tea Room can be marked to show the evacuation of the different towns and their restoration to the French authorities?
    Mr. CHURCHILL: The general nature of the withdrawal of the Army from France and Belgium consists in the elimination of all men who are eligible for demobilisation, the formations and units not required for the forces to be maintained temporarily in France, Belgium and Germany being brought home by cadres in some cases and in others being dispersed
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    altogether. The first cadres to be sent to England will be those of Regular units which will be reconstituted to form the after-war Army. With regard to the latter part of the question, the different towns and villages in France occupied by the British Armies have always retained their civil authorities, who continue to exercise their usual functions. No useful purpose, therefore, would be served by marking each town or village as it ceased to be used for billeting British troops.
    Sir A. FELL: Is there a withdrawal from the interior towns towards the coast of the English Army in France?
    Mr. CHURCHILL: Much more than three-quarters—I might almost say four-fifths—of the British Army in France have already come home. Therefore there has been a tremendous restriction of the area which they are occupying. I could not say that there might not be individual cases of British troops in a very much wider area.

    VOLUNTEER ENLISTMENTS.
    Captain COOTEasked the Secretary of State for War whether he will state the number of Volunteers enlisted to date; and whether the rate of recruitment is being maintained at 1,000 per day?
    Mr. CHURCHILL: The following figures show the number of recruits enlisted on normal engagements and the number of re-enlistments of men already serving, with the average daily rate:—

    Number of recruits enlisted on normal attestations from 1st January to 15th March, 1919, is

    8,986

    Number of re-enlistments under Army Order IV. (i.e. for two, three, or four years) up to 15th March is

    51,874

    Total enlisted in sixty-three days is

    60,860

    or 935 per day.

    Between the 15th March and the 19th March (i.e. on the 16th, 17th, and 18th March) the number of re-enlistments was

    3,297

    or at a rate of over 1,000 per day.

    Colonel ASHLEY: What is the normal period of engagement now?
    Mr. CHURCHILL: These young boys, of whom we are getting 8,900, are enlisting for seven years with the Colours and five with the Reserve.

    LOW CATEGORY MEN.
    Captain COOTEasked the Secretary of State for War whether it is his intention to keep with the Colours men of a low medical category, e.g., B 3; and, if so, for what purpose will these men be employed?
    Mr. CHURCHILL: The answer is in the affirmative, unless they are eligible for demobilisation, and provided they are capable of carrying out the duties they are called upon to perform. Many of these men are employed in administrative services, and their demobilisation would lead to considerable dislocation.

    SERVICE ON LAND.
    Brigadier-General COCKERILLasked the Secretary of State for War whether a man serving in an agricultural company in the United Kingdom can volunteer or be detailed for service on the land with a private employer; and, if so, whether a man so serving, who is ineligible for demobilisation but can prove that he is the occupying tenant of a farm that is being neglected through lack of labour, can obtain his own services on payment instead of working for a stranger?
    Mr. CHURCHILL: Soldiers serving in agricultural companies are sent out for work on the land with private employers. In many cases these men are already working on their own holdings. All not in the retained classes are being demobilised. Those who are ineligible for demobilisation will shortly have to be withdrawn for military duty, and therefore it is inadvisable to move these men from their present employment.

    TRIUMPHAL MARCHES.
    Mr. BLAIRasked the Secretary of State for War if all the triumphal marches have so far taken place only in the City
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    and West End; and, if so, will he arrange that the East End will have the same privilege on the next occasion?
    Mr. CHURCHILL: In the event of further triumphal marches through London being arranged, the claims of the East End will not be overlooked. At the same time it must be understood that, in the interests of the troops, the length of the route has to be taken into consideration together with other military requirements connected therewith.
    Mr. ALFRED LAWasked the Secretary of State for War whether it is the definite intention of the War Office to give to the members of the Lancashire Territorial Divisions who have fought both in Gallipoli and in France, equal opportunities for a triumphal march either in London or Lancashire as are to be given to the Guards Division?
    Mr. CHURCHILL: I have given directions that the question of triumphal marches of troops through the various cities and localities with which they are territorially connected should be studied with a view to action in all possible cases.
    Mr. MACMASTER: What opportunity will be given for a parade of Colonials?
    Mr. CHURCHILL: I have been asking about that myself this morning. I cannot give an answer at the moment, but it seems to me very desirable that it should be arranged.
    Lieutenant-Colonel ARTHUR MURRAY: Would it not give great gratification to the Dominions if a triumphal march of the Dominion troops through London were arranged?
    Mr. CHURCHILL: That is what I have been trying to answer.
    Captain WEDGWOOD BENN: Will the right hon. Gentleman remember the claims of the Air Force?
    Mr. CHURCHILL: Certainly.

    SOLDIERS RETURNING FROM EAST.
    Mr. GREERasked the Secretary of State for War whether he is aware that anxiety is prevalent amongst relatives of soldiers returning or expected to return from the war zones of the East, who, by reason of long service in hot climates

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    without home leave, are peculiarly susceptible to the changes of temperature incidental to the long journey involved, exposing them to risks from attacks of influenza and contingent maladies; whether he is aware that cases of death have already occurred from such causes following arrivals in this country from Eastern quarters; and whether steps have been or will be taken to provide adequate safeguards for men returning from such parts, by means of warm clothing, hot food, and suitable travelling accommodation?
    Mr. CHURCHILL: I would refer my hon. Friend to the written answer which I gave yesterday to my hon. Friend the Member for Keighley, explaining the transport difficulties and the measures already adopted. The most strenuous efforts have been and will be made to improve the conditions in every way and to safeguard the health and comfort of the men. Conditions are getting easier each week

    FIRST ARMY SIGNALS.
    Mr. HAYDAYasked the Secretary of State for War whether men who volunteered in 1914 are being retained with the 1st Army Signals to complete the technical minimum of office telegraphists; whether, of the men retained because of their telegraphic skill, a number are being irregularly and improperly employed on work which has no connection with their craft, and which, if essential to the Army of Occupation, could be performed at a lower cost by the employment of civilian labour; whether four are employed in a cinema orchestra; whether there are six 1914 volunteers with the 1st Army Signals over forty-one years of age; and whether there is any military necessity other than the question of command pay for the retention of these men?
    Mr. CHURCHILL: Inquiries will be made and I will inform my hon. Friend of the result as early as possible. The last part of the question is not understood.

    ARMY BOOTS.
    Mr. CLOUGHasked the Secretary of State for War if he has yet come to a decision with regard to offering to volunteers at a reasonable price the Army
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    boots which have been tried by them; and whether he is aware that discarded Army boots, bought at salvage sales for 4d. and sometimes even 2d. a pair, are being sold to the public after renovation at 12s. 6d. to 15s.?
    Mr. FORSTER: As regards the first part of the question, the matter is still under consideration. The second part of the question is for the Ministry of Munitions, and that Department will, I understand, communicate with my hon. Friend on the subject.

  NAVAL AND MILITARY PENSIONS AND GRANTS.

    RE-ENLISTED MEN.
    Major COPEasked the Secretary of State for War whether, in view of the services rendered by re-enlisted men during the War, he will consider the possibility of taking into consideration the previous broken service and allowing it to count towards a modified pension?
    Mr. FORSTER: Under Army Order 56, of 1919, all mobilised service in the present War given by a soldier who has previously served in the Regular Army, including mobilised service in the Territorial Force, counts as service and qualifying service towards pension.
    Colonel YATE: Does that apply to officers?
    Mr. FORSTER: I think so.

    REGULAR OFFICERS.
    Major M'LEANasked the Secretary of State for War if he has under consideration an increase in the rates of pension to Regular officers?
    Mr. FORSTER: Yes, Sir.

    OLD SOLDIERS.
    Captain BRACKENBURYasked the Pensions Minister whether he is aware that old soldiers discharged before the War consider it a hardship that they should not receive such increase in their pensions as is given to soldiers discharged since the beginning of the War in order to cover the higher cost of living; and, if so, whether he will take steps to remove this injustice?
    The PARLIAMENTARY SECRETARY to the MINISTRY of PENSIONS (Sir James Craig): So far as has been found practicable—that is, in the case of total incapacity and of certain specific disabilities—the pensions of previous wars have been raised to the level of those of the present war, and where so raised the war bonus of 20 per cent. now in payment in respect of present war pensions is also added. It is not in contemplation to extend the bonus to other classes of pension.

    CONSULAR SERVICE.
    Lieutenant-Colonel Sir S. HOAREasked the Secretary of State for Foreign Affairs what progress has been made with reference to the reform of the Consular Service?
    Sir A. STEEL-MAITLAND (Department of Overseas Trade): A general scheme has now been completed for an increased number of salaried Consular posts, and a revised scale of salaries for Consular officers of all grades has been drawn up. These proposals are about to be submitted for sanction, and it is hoped may shortly be put into force.

    CENTRAL REGIMENTAL INSTITUTES FUNDS.
    Lieutenant-Colonel WEIGALLasked whether the Central Regimental Institutes funds have been used by the Navy and Army Canteen Board as part of the trading capital of the board; whether the board was financed by a loan of two millions sterling guaranteed by the Treasury; whether the profits accruing have been obtained from the expenditure of the 5½d. messing grant or the spending of the soldiers' private money; and what justification is there for utilising any of these profits in financial arrangements to meet changes of personnel?
    Mr. FORSTER: The balance of the Central Regimental Institutes Fund, after payment of the grants made from it by the Army Council, is used by the Navy and Army Canteen Board as part of its trading capital, and interest has been credited thereon. The board have been financed by Treasury guarantee to a maximum amount of £3,000,000. The present debt is £1,600,000, which it is expected will be fully liquidated by the
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    end of June. The profits of the organisation have been derived from both sources mentioned. The cost of the personnel is a part of the working expenses of the board, and as such is payable out of its revenue.
    Colonel BURN: Will the Secretary for War be willing to receive a small deputation of officers who are interested in this matter?
    Mr. CHURCHILL: That is a matter connected with my right hon. Friend's Department.
    Sir F. HALL: Will the Financial Secretary receive a deputation?
    Mr. FORSTER: Yes, Sir.
    Lieutenant - Colonel WEIGALLasked whether any decision has yet been arrived at as to the ultimate disposal of central regimental funds?
    Mr. FORSTER: This matter is still under consideration.
    Major Earl WINTERTON: Have any efforts been made to ascertain the wishes of officers and other ranks in this matter? Is the right hon. Gentleman aware that considerable dissatisfaction exists in regard to the somewhat arbitrary action of the Army Council in deciding to practically seize regimental funds?
    Mr. FORSTER: Successful attempts have been made to ascertain the views of regimental officers and other ranks. I have no information in my possession which bears out the latter part of my Noble Friend's suggestion.
    Sir F. HALL: Will the right hon. Gentleman recognise the fact that these funds have been contributed not only by regimental officers but to a greater extent by the men, and that they should be taken into consideration?

    NATIONAL EXPENDITURE (SELECT COMMITTEE).
    Lieutenant-Colonel WEIGALLasked whether any decision has been arrived at between the War Office and the Treasury in reference to the question referred by the Select Committee on National Expenditure in August, 1918, to these Departments?
    Mr. FORSTER: The answer is in the negative.

    ROYAL DEFENCE CORPS (SERGEANT W. J. JOHNSON).
    Colonel ASHLEYasked why Sergeant W. J. Johnson, No. 3509, Royal Defence Corps, Experimental Guard, Portam, Salisbury, aged about fifty, married, with two children, is detained in the Army?
    Mr. CHURCHILL: Inquiries will be made, and I will inform my hon. and gallant Friend of the result as soon as possible.

    OFFICER CADETS.
    Colonel YATEasked the Secretary for War whether he will consider the question of giving officer cadets who after passing the test for commissioned rank at the training schools have been granted temporary commissions and then demobilised without pay, pension, or gratuity, the same terms as regards outfit allowance as have been given to the Royal Air Force cadets similarly demobilized?
    Mr. FORSTER: The cadets of both Services are warned that they should restrict the provisions of officers' uniform to a minimum scale, and they receive allowances accordingly. There is no material difference of treatment.
    Colonel YATE: If there is a material difference, will the right hon. Gentleman correct it?
    Mr. FORSTER: It depends whether I find that our practice was in fault. I can assure my hon. Friend that there is no material difference.

    SILVER CROSS OF SACRIFICE.
    Mr. HURDasked the Secretary for War whether he has observed that the Canadian Government is now issuing a silver Cross of Sacrifice to widows and mothers of Canadians killed at the front; and whether he can now devise means of removing the delay in the issue of similar memorials to the relatives of British soldiers who have fallen in the War?
    Mr. CHURCHILL: The reasons for the unavoidable delay in the issue of the plaque and scroll were fully explained in the answer given to my hon. Friend on the 17th February. My hon. Friend may rest assured that the work is being expedited
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    as rapidly as circumstances permit, but the pressure of work in record offices is very great at present.
    Mr. HURD: Has any progress been made since the right hon. Gentleman gave his last answer?
    Mr. CHURCHILL: Oh, yes.

    TERRITORIAL AND TEMPORARY OFFICERS.
    Major M'LEANasked the Secretary of State for War if the applications of Territorial and temporary officers for Regular commissions are being considered; if so, will previous war service be taken into account in deciding seniority; and could the gazette be hastened of successful applicants?
    Mr. CHURCHILL: The matter is at present being considered by the Army Council, and I am not yet in a position to make a statement on the subject. My hon. and gallant Friend's suggestion that previous service should be taken into account in deciding seniority is being borne in mind.
    Major M'LEANasked if the gratuity to temporary and Territorial officers granted Regular commissions will be as for Regular officers though, service during the War was as a Territorial officer?
    Mr. FORSTER: I would refer my hon. and gallant Friend to the answer given yesterday to my hon. Friend the Member for Wirrall. The answer is in the affirmative, as laid down in Army Order 85 of 11th February.

    CHINESE LABOUR (FRANCE).
    Sir A. FELLasked how many Chinese are now employed in France and what steps are being taken to get them back to China; and how many natives from Africa are now being employed and when they will be returned home?
    Mr. CHURCHILL: On 8th March there were about 83,000 Chinese Coolies employed in France, of whom 4,000 are under orders to return, and will probably be repatriated by the end of April. No date has been fixed as regards the repatriation of the remainder, who will be required in France for some time. They cannot in any case have priority over the Australian

    209
    troops who have been fighting, whereas the Chinese have not been exposed to danger. There are 4,000 African natives in France, 1,200 of the Cape Coloured Labour Battalion and 2,800 of the Cape Auxiliary Horse Transport Companies. No date has yet been fixed when their services can be dispensed with, as they are now employed on salvage work.

    FORCIBLE FEEDING.
    Colonel WEDGWOODasked the Secretary of State for the Home Department whether the Prisoners (Temporary Discharge for Ill-Health) Act, 1913, was passed to obviate the necessity of forcible feeding; and how much longer he intends to use the practice of forcible feeding in conjunction with temporary discharge under this Act?
    The SECRETARY of STATE for the HOME DEPARTMENT (Mr. Shortt): The Act referred to was passed in order to provide an alternative to forcible feeding in cases where this form of medical treatment could not be applied because of the prisoner's stale of health or for other reasons. There is no such practice as that alleged in the second part of the question.
    Colonel WEDGWOOD: Does the right hon. Gentleman realise that this practice of forcible feeding of helpless prisoners is repugnant to the consciences of all decent people?

    TAXI-CABS.
    Sir P. GOFFasked the Secretary of State for the Home Department whether, having regard to the fact that a large number of cabs were withdrawn from the streets in consequence of the refusal to sanction an agreement come to between the taxi-cab owners and drivers for the substitution of an all-round rate of 1s. per mile, owners agreeing to supply free petrol, in place of the existing 8d. per mile and 6d. extra, he can now see his way to consent to this arrangement being at once carried out?
    Mr. SHORTT: The withdrawal of cabs to which the hon. Member refers was caused by a dispute between the Cab Company and its drivers. The company is now getting a number of its cabs re-licensed. I cannot agree to a further increase in cab fares. As I stated on the
    210
    11th March, the present shortage of cabs is due to scarcity of materials and labour; and an increase in fares would not, I am advised, produce an increase in the number of cabs.
    Sir P. GOFF: Will the right hon. Gentleman give favourable consideration to a request to receive a deputation on the subject?
    Mr. SHORTT: Certainly, if I am asked to do so.
    Sir P. GOFFasked the Secretary of State for the Home Department whether a taxi-cab driver accepting a hire to a house, hotel, or club has the right to refuse to wait for the fare; whether during the hiring he has the right to stop and demand his discharge on the plea of another engagement; and, if so, what remedy, if any, the public have?
    Mr. SHORTT: By Section 47 of the London Hackney Carriage Act, 1831, the driver of a cab may demand a deposit if required to wait; therefore, by implication, a driver may be compelled to wait. Although there is no decision on the point, the general view is that if a driver accepts a hiring he is bound to complete his contract with the hirer. Should he decline to complete the hiring, he can be summoned.
    Sir P. GOFF: Is the driver of a car in the rank for hire in New Palace Yard, where he has been admitted without paying entrance fee which is paid at the railway stations, entitled to refuse a fare?
    Mr. SHORTT: I suppose that that will be covered by the answer.

    SCHOOL CHILDREN (EMPLOYMENT).
    Lord H. CAVENDISH-BENTINCKasked the Secretary of State for the Home Department whether he has yet received for confirmation any by-laws relaxing the Statute which prohibits employment of school children by others than their parents before school hours; and whether, before confirming any such by-law, he will require the insertion of all conditions necessary to safeguard the interests of the children, especially such as will secure them their usual hours for sleep, and for breakfast, and freedom from employment during ill-health, or in the open air in bad

    211
    weather, or in any occupation likely to be injurious to life, limb, health, or education; and will fix quite definitely the hour of employment, and provide that all such employment shall be subject to the holding of a licence which may be granted, suspended, or revoked by the local education authority?
    Mr. SHORTT: Some local authorities have submitted by-laws under Section 13 (1) (i) of the Education Act of last Session, permitting the employment of children before school. No such by-laws have yet been confirmed, and the whole question of the safeguards to be required in any case where such employment is permitted is now under consideration. The points mentioned by the Noble Lord will be borne in mind.

    SIR EDGAR SPEYER.
    Mr. E. CECILasked what is the state of the proceedings taken for revoking the certificate of naturalisation of Sir Edgar Speyer; and when a decision is likely to be arrived at?
    Mr. SHORTT: The question of the revocation of Sir Edgar Speyer's certificate of naturalisation has been referred to the Certificates of Naturalisation (Revocation) Committee. I cannot say when a decision will be reached.
    Mr. JOYNSON-HICKS: May I ask how that Committee is getting on?
    Mr. SPEAKER: The hon. Gentleman must give notice of that question.

    CONSCIENTIOUS OBJECTORS.
    Colonel WEDGWOODasked the Secretary of State for the Home Department whether he is aware that K. H. Birtles, a conscientious objector who was on hunger strike in Wandsworth Prison, was kept without water from dinner-time on Sunday, 2nd March, till tea-time on Monday, 3rd March; and whether, in view of the instructions sent to the officials at Wandsworth Prison, he proposes to take any action in the matter?
    Mr. SHORTT: The answer to the first question is in the negative, and the second question does not arise.

    WAR ATROCITIES.
    Mr. L. LYLEasked the Prime Minister when the Committee dealing with individual responsibility for breaches of civilised warfare expects to report; and whether there is any reason why immediate action should not be taken against those in high positions who are responsible for the War and for the atrocities committed without waiting for the legal decision of the Committee which has been considering the question for so many weeks past?
    Mr. BONAR LAW (Leader of the House): The Committee dealing with individual responsibility for breaches of civilised warfare expects to make its Report to the Peace Conference almost immediately. It has already met to consider its final Report. Until this Report has been received and considered, it would not be possible to take action as suggested.

    LEAGUE OF NATIONS (GOVERNMENT POLICY).
    Colonel GRETTONasked the Prime Minister if the interview on the subjects of the League of Nations and the preliminary Peace Treaty given to the Press in Paris by the right hon. Member for Hitchin, and published in London on Wednesday, 19th March, was given by the authority of the British Peace Delegation; and if the statements made represent the considered view of His Majesty's Government?
    Mr. BONAR LAW: This interview was given by my right hon. Friend with the approval of the Prime Minister and Foreign Secretary, and it does in substance represent the views of His Majesty's Government.

    RUMANIA (DESTRUCTION OF BRITISH PROPERTY).
    Sir F. HALLasked the Prime Minister whether he is aware that damage was previous to the Armistice caused to property of British subjects at Galatz and Sulina, including destruction of machinery; whether he is aware that a considerable amount of the loss sustained was owing to the destruction of such pro-

    213
    perty on the direct authority of British officers acting on behalf of the British Government; and whether, in consequence of the losses that have taken place and which must ultimately be made good by the British Government, he will at once issue authority for a payment on account to such British subjects, in order that they may be able to recommence their business operations, leaving the final adjustment in abeyance until accounts have been agreed to by both parties?
    Mr. HARMSWORTH: It is presumed that this question relates to the destruction of property at Galatz and Sulina, some of which belonged to British subjects, at the end of 1916. The destruction was carried out by the order, and with the authority of the Roumanian Government, as a measure of national defence, and, consequently, claims for compensation should be made against that Government and not against His Majesty's Government.
    Sir F. HALL: If I can bring to the notice of the hon. Gentleman sufficient proof that it was decided on the authority of British officers on behalf of the British Government, would he reconsider the matter and make a payment on account to these British subjects?
    Mr. HARMSWORTH: I shall be glad to receive whatever information my hon. and gallant Friend will furnish.

    DUKES OF ALBANY AND CUMBERLAND.
    Mr. BOTTOMLEYasked whether, now that the Report of the Privy Council recommending the deprivation of the peerages of the Dukes of Albany and Cumberland has been laid upon the Table for the necessary period prescribed by the Act, instructions have been given for the removal of these two names from the Roll of Parliament?
    Mr. BONAR LAW: The necessary directions will be given as soon as the Report has been presented to His Majesty in the manner required by the Act. That presentation will, I hope, be made this week.

    WATER POWER (HIGHLANDS OF SCOTLAND).
    Mr. STURROCKasked whether the Government intends to take early action
    214
    on the recommendations contained in the Interim Report of the Water Power Resources Committee which affect the Highlands of Scotland?
    The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. Bridgeman): The Report is under consideration, and I am not yet in a position to say what action will be taken in regard to the Scottish water powers to which the Committee call attention.

    NATIONAL RELIEF FUND.
    Sir K. WOODasked the Prime Minister whether he will consider the desirability of taking such steps as will secure Parliamentary control of the National Relief Fund?
    Mr. BONAR LAW: The Government are not prepared to adopt the suggestion of my hon. Friend.

    MINISTRIES OF NATIONAL SERVICE AND RECONSTRUCTION.
    Mr. HAYDAYasked the Lord Privy Seal whether the Ministries of National Service and Reconstruction have now been combined in one Department; if so, can he state under what authority this has been done; and whether the Minister of National Service and Reconstruction is receiving the salaries and emoluments of both offices?
    Mr. BONAR LAW: The Ministry of Reconstruction remains distinct from the Ministry of National Service, which is in course of being wound up. As regards the last part of the question, the answer is in the affirmative.

    INCOME TAX.
    Mr. GODFREY LOCKER-LAMPSONasked the Chancellor of the Exchequer if there are any circumstances under which an interim repayment claim in respect of Income Tax can be made by a married woman living with her husband?
    The CHANCELLOR of the EXCHEQUER (Mr. Chamberlain): Yes, Sir. If an application for separate treatment has been made, a married woman can claim an interim repayment under the same conditions as any other person.
    Mr. LOCKER-LAMPSON: Can she do that if she is married?
    Mr. CHAMBERLAIN: I am informed she can do it on the same conditions as any other person.
    Mr. SWANasked the Chancellor of the Exchequer if he is prepared to provide in his forthcoming Budget for an allowance of £25 per annum from Income Tax to working-class parents who keep children over sixteen years of age going to school for higher educational purposes, as the existing tax is likely to deter education and otherwise prevent bright children of the poor from educational equipment?
    Mr. CHAMBERLAIN: I would refer the hon. Member to the answer given on the 20th ult. to a similar question by my hon. Friend the Member for Newcastle North.

    ENTERTAINMENTS DUTY.
    Mr. ALFRED LAWasked the Chancellor of the Exchequer whether he will consider the remission of Entertainments Tax on the gate money of cricket clubs and other clubs founded for the encouragement of sports?
    Mr. BALDWIN (Joint Financial Secretary to the Treasury): I beg to refer my hon. Friend to the reply given to my hon. and gallant Friend the Member for Barkston Ash on the 27th February.

    INFLUENZA EPIDEMIC (NATIONAL SCHOOLS, IRELAND).
    Mr. DEVLINasked the Chancellor of the Exchequer whether he is aware that, owing to the influenza epidemic in Ireland, the average attendance in the majority of Irish national schools has been seriously affected during the last year; whether many of the schools have been closed on several occasions by the local medical authorities; whether the consequent falling off in average will entail serious financial losses to managers and teachers; and whether, in view of the fact that this depreciation in average has been through no fault of the teachers, the Treasury will make the following concessions for the current year: Where the average attendance for the year ending 31st March, 1919, has been adversely affected principal teachers should be allowed to
    216
    substitute the average for the previous financial year; in the matter of fees for teaching extra subjects outside school hours, the number of lessons in extra subjects should be reduced pro tanto, and substitution of average allowed as suggested; grants to managers for the cost of heating and cleaning schools should be based, where necessary, on the average for the preceding year; and no increment of good service salary should be withheld when a fall in average is clearly due to epidemic disease?
    Mr. BALDWIN: I beg to refer to the answer given to the hon. Member for Mid Antrim on the 17th ultimo. The question of extending the concession in respect of the recent outbreak of influenza is under consideration.

    CONCRETE SHIPS.
    Commander Viscount CURZONasked the Parliamentary Secretary to the Shipping Controller if he can state how many concrete ships are now under construction and how many have been passed into service; if the construction of any further ships of this type is contemplated; and can he state what results have so far been realised as to the success or otherwise of this type of ship?
    The PARLIAMENTARY SECRETARY to the MINISTRY of SHIPPING (Colonel Leslie Wilson): The number of concrete barges launched to date is 22. Of these, 9 have been completed and 5 actually delivered. In addition, there are at present 22 barges under construction. There are also six concrete tugs under construction of which the first was launched on the 15th instant. It is not the present intention of the Government to build any more concrete vessels, as they are not required for Government use, but there is nothing to prevent contracts being placed for private account. There has scarcely been sufficient experience yet of these craft to justify a definite opinion as to their success.
    Viscount CURZON: Can the hon. Gentleman say whether any of those ships have proved failures?
    Colonel WILSON: There is a question on the Paper for to-morrow with regard to two of them, and I would refer my hon. Friend to the reply.

    PHYSICAL TRAINING INSPECTORS.
    Colonel YATEasked the President of the Board of Education whether, considering that of the seven expert inspectors of physical training on the staff of the Board of Education in November last five were women and only two were men and both of those men were then away on service, he will now consider the question of appointing at least one man inspector for boys and one woman inspector for girls to each inspectorial division?
    The PRESIDENT of the BOARD of EDUCATION (Mr. Herbert Fisher): The question of the desirability of strengthening the Board's staff of inspectors of physical training is at present under my consideration.
    Colonel YATE: How long will it remain under consideration?

    CIVIL SERVANTS (PENSIONS).
    Major COPEasked the Secretary to the Treasury if he is prepared to consider the advisability of granting a temporary increase in the pensions of all Civil servants whose pensions are at present based on a pre-war standard?
    Mr. BALDWIN: I would refer the hon. and gallant Member to my reply to the hon. Member for Stoke Newington on the 18th instant.

    LONDON COUNTY COUNCIL STAFF (SALARIES).
    Mr. JESSONasked the Secretary to the Treasury whether he is aware that the London County Council, after consultation with the London County Council Staff Association, recently resolved to increase the salaries and wages of the employés of the council receiving up to and including £400 per annum by 20 per cent., for a period of twelve months dating from 1st January last, that this increase counts for sick pay, overtime and pension, and is also in addition to the war bonus which is identical with that obtaining in the Civil Service; and, if so, whether he will now confer with those associations that represent the Civil Service, with a view to the grant of a similar increase of salaries to Civil servants on the ground of the decreased purchasing power of the sovereign?
    Mr. BALDWIN: My attention has been drawn to the arrangement made by the London County Council. A claim for a further increase of war bonus made on behalf of the main classes of Civil Service has been the subject of proceedings before the Conciliation and Arbitration Board, and I understand that their award is likely to be issued at an early date.

    DISCHARGED SOLDIERS (EMPLOYMENTS).
    Major COPEasked the Minister of Labour whether, having regard to the number of discharged men recommended for employment in light work only and so certified on their medical cards, and the lack of such employment in the ordinary labour market, he will consider the question of State employment in special factories for such men, under medical supervision, until they are fit for normal work?
    The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. Wardle): I would refer the hon. and gallant Member to the statement made on the 13th March in reply to the same question by the hon. and gallant Member for Sowerby, to which it is not possible for me to add anything at present.

    UNEMPLOYMENT DONATION (AGRICULTURE).
    Mr. W. R. SMITHasked the Minister of Labour if he can give a Return showing the number of land workers or agricultural labourers at present drawing unemployment benefit, and as to which areas that are affected in this respect?
    Mr. WARDLE: The number of workers in agricultural occupations drawing unemployment benefit on 14th March was 9,037. Of these 1,473 were civilian men, 2,248 civilian women, 354 juveniles, and 4,962 demobilised members of His Majesty's Forces. Nearly 40 per cent. of the policies are lodged in Ireland, 15 per cent. in the London and South-Eastern divisions, and 10 per cent. in each of the following divisions — South Midlands, and Eastern, West Midlands.
    Mr. LAMBERT: Have any attempts been made by the Ministry to place these men in agricultural employment?
    Mr. WARDLE: Certainly.
    Mr. LAMBERT: Why is it when agriculture is crying out for labour that these men cannot be placed?
    Mr. WARDLE: It is impossible to put everybody into employment, even in agriculture, all in a moment.

    OSWESTRY TOWN COUNCIL (SANITARY INSPECTOR).
    Colonel ASHLEYasked the President of the Local Government Board (1) whether, in the case of the assistant sanitary and water inspector appointed the week before last by the Oswestry Town Council, the council took steps to circulate particulars of the post which was vacant through the Labour Exchange Bureaux throughout the country so that ex-Service men might have the opportunity of applying; (2) whether he is aware that the week before last the Oswestry Town Council appointed as assistant sanitary and water inspector for the borough a young man from Hyde, in Lancashire, thirty years of age, who had been exempted from military service during the War; whether he is also aware that several ex-Service men resident in the locality applied for the post, of unimpeachable character and with experience; and will he state what steps he proposes to take to see that the legitimate claims of men who have served their country are preferred in such appointmnts to men who have never served and who were catalogued as indispensable while compulsory military service was in force?
    The PARLIAMENTARY SECRETARY to the LOCAL GOVERNMENT BOARD (Major Astor): I have communicated with the town council of Oswestry, and they inform me that an advertisment was inserted in the local and other papers circulating among the class of men required, and twenty-six applications were received. The whole of the applications were carefully gone through by the Water Committee who were unanimous in their desire to give the preference to a demobilised or discharged soldier, who was qualified to fill the appointment; but, after carefully considering each application and the accompanying testimonials, they felt that they could not do other than make the recommendation they did.
    Colonel ASHLEY: May I ask why it was when the Chairman of the Local Labour Bureau asked the Mayor to circularise the vacancy through his Bureau and other Labour Bureaux throughout the country and asking ex-Service men to apply, the Mayor did not even answer the question, and will the hon. Gentleman communicate with the town council and ask, as I understand the man appointed has withdrawn, if they will now give the preference to an ex-Service man?
    Major ASTOR: I will communicate with them on the point raised by my hon. Friend.

    ROAD DETERIORATION.
    Sir ROBERT WOODSasked the President of the Local Government Board whether, with a view to preventing unnecessary deterioration of roads, he will introduce a regulation fixing a definite relation between the width of tyres and the number of wheels, their diameter, and the maximum load of vehicles?
    Major ASTOR: The Local Government Board has no power to make such a regulation as the hon. Member suggests for vehicular traffic generally. Such powers as it possesses with respect to motor vehicles will be transferred to the new Ministry of Ways and Communications when constituted.

    TELEPHONE REPAIRS (NELSON).
    Captain ALBERT SMITHasked the Postmaster-General what progress has been made in repairing the telephone lines brought down on 4th January last in the Nelson district; is he aware that a large number of important business firms are still unconnected, and will he do all in his power to restore communication?
    The POSTMASTER-GENERAL (Mr. Illingworth): About one-half of the subscribers' lines have been restored, and the work is proceeding as rapidly as circumstances permit.

    IMPORT RESTRICTIONS.
    Captain BROWNasked the President of the Board of Trade if there are any existing restrictions on the import to this country of manufactured paper; and, if so, whether it is intended to remove them in the near future?
    Mr. BRIDGEMAN: There is no restriction on the importation to this country of manufactured paper coming from another part of the Empire. Imports of manufactured paper from other countries are still subject to licence by the Paper Control until it ceases on 30th April. The intention is to keep imports to about 75 per cent. of the pre-war amount while the control continues.
    Captain WEDGWOOD BENN: Can the hon. Gentleman say why there is a difference between the paper imported from other parts of the Empire and paper imported from foreign countries?
    Mr. BRIDGEMAN: That was all explained in the Debate on the 10th March.
    Mr. HARRY HOPEasked the President of the Board of Trade whether, in view of the effect on the paper-making industry of Scotland by the unrestricted importation of paper as now sanctioned and of the threatened closing down of many of our paper mills, with the accompanying unemployment of many workers, he will take steps to protect this home industry against the foreign competition of Scandinavia and America?
    Mr. BRIDGEMAN: The importation of paper is not entirely unrestricted. Until the end of April, importations of paper are limited to 75 per cent. of the pre-war quantity. As regards the protection of the home industry against foreign competition, my right hon. Friend is giving careful consideration to this question.
    Major BARNESasked the President of the Board of Trade whether, in view of the pledge given by the Minister of National Service and Reconstruction that raw materials required by our industries shall now be admitted free of restriction, he will say why pitwood is not included in the list of imported timber which may, after the 31st March, be imported without licence?
    Mr. BRIDGEMAN: It is desirable to continue the licensing of pitwood in order that when necessary the available tonnage may be used for sawn timber which at some ports is more urgently needed than pitwood. Licences are, however, readily granted for ports at which the stocks of pitwood are insufficient.

  RAILWAY ADMINISTRATION.

    EXISTING COMPANIES.
    Colonel THORNEasked the President of the Board of Trade how many railway companies there were in the United Kingdom in 1918 and the number in 1895, how many boards, and how many directors; and if he can state whether the larger railways have boards over the Carriage Audit Secretaries and Rates Departments?
    Mr. BRIDGEMAN: There were approximately 300 railway companies in existence in 1895 and 240 in 1918. I cannot give the number of directors. A few of the larger companies have separate audit committees, but this does not involve the appointment of separate boards. I am not aware of any separate boards appointed to deal with the other departments mentioned.

    PURCHASE OF LINES.
    Colonel THORNEasked the President of the Board of Trade if he is aware that the Government have the right to purchase the railways constructed after the date of the passing of the Act (1844) at 25 years' purchase upon giving in writing three months' notice of their intention to do so, the purchase value to be calculated on the amount earned by the companies in the three preceding years; and if he will take action in the matter?
    Mr. BRIDGEMAN: Section 2 of the Act referred to makes it lawful for the Treasury to purchase such railways as have been authorised since 1844 upon giving three months' notice in writing to the company concerned of their intention to do so, but under Section 4 of the Act no such notice can be given until Parliament has passed authorising legislation.

    TRADE CONDITIONS.
    Major BARNESasked the President of the Board of Trade whether industries, such as the dye trade, which require to be shielded from foreign competition, will be carried on under Government control, to ensure that the protection given is to the public interest; whether there will be any restriction on the amount of interest that may be paid on the actual capital invested; if so, what the restriction will be; and to what purpose net profits in excess of those required for the payment of such interest will be put?
    Mr. BRIDGEMAN: The policy respecting the dye industry is fully set out in the White Paper (Cd. 9194) issued in November last, to which I would refer the hon. and gallant Member. The precise nature of the policy to be pursued to secure the development and maintenance of other industries of special national importance is now under consideration, but I am unable at present to state the exact character of the safeguards which will need to be adopted.

  FOOD SUPPLIES.

    OATS.
    Colonel THORNEasked the Food Controller if he will state the price at which proprietors of racing or hunting studs are enabled to procure oats, and how this compares per lb. with the controlled price charged by corn dealers to persons in towns and cities who require small quantities for feeding rabbits and similar purposes; and if he will state the actual amount of subsidy paid from national taxation towards growing a quarter of oats in this country?
    The MINISTER of FOOD (Mr. Roberts): Proprietors of racing and hunting studs are, like other persons, able to buy oats in the open market, the only control being the maximum price fixed by the Grain (Prices) Order. Persons who buy small quantities of oats, e.g., for feeding rabbits, etc., through local corn dealers, may in some cases pay a slightly larger price, since the Order allows dealers to charge higher prices for small retail quantities; but the difference in price is practically negligible, and probably does not exceed ½d. a lb. I may add that in many districts oats have recently been sold at prices considerably less than the maximum prices laid down in the Order. As regards the last part of the question, the growing of oats in this country is not subsidised.

    MEAT.
    Colonel THORNEasked the Minister of Food if, between 9th December, 1918, and 2nd February last, the Government slaughter-house agent at Salisbury voluntarily surrendered to the local sanitary inspector 18,340 lbs. of meat, besides large quantities of offal, as unfit for human food; if these animals were bought by the Government and, if so, who bought them; who bears the loss of the
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    18,340 lbs. of meat; and whether this food was bought originally to feed our soldiers and sailors?
    Mr. ROBERTS: The answer to the first part of the question is in the affirmative. The fourth-grade cattle, from which the meat in question was obtained, had not been purchased on behalf of the Government, and as the insurance scheme of the Ministry of Food does not include such cattle, the loss falls on the owners of the beasts. The answer to the last part of the question is in the negative.

    POTATOES.
    Mr. H. HOPEasked the Minister of Food whether Scotland is getting a share of the German order for potatoes; and, if so, how many tons are to be exported to Germany, and at what price?
    Mr. ROBERTS: The answer to the first part of the question is in the affirmative. As regards the second part, the total quantity of potatoes to be shipped to Germany and the price at which they are to be sold have not yet been definitely fixed.
    Lieutenant-Colonel A. C. MURRAY: Will the right hon. Gentleman arrange, as far as possible, that an equal quantity of potatoes shall be taken from each of the potato-growing districts in Scotland, so that one potato-growing area in Scotland shall not suffer as distinguished from another?
    Mr. ROBERTS: Every effort will be made in that direction.
    Lieutenant-Colonel WHELER: Will the right hon. Gentleman also consider the interests of the English potato growers in this question?

    CORN, MEAT, AND TEA (GOVERNMENT STOCKS).
    Lieutenant-Colonel Sir S. HOAREasked the Minister of Food whether he will state the present stocks held by the Government of corn, meat, and tea?
    Mr. ROBERTS: The stocks held by the Ministry of Food in the United Kingdom are at present as follows:

    Tons.

    Wheat

    …

    285,563

    Flour

    …

    302,708

    Meat—Frozen

    …

    42,659

    Meat—Canned

    …

    13,500

    Meat—Bacon and hams

    …

    25,308

    Tea

    …

    45,953

    Colonel ASHLEY: Is it the intention of the Government to make a profit out of the sale of the stocks they now hold?
    Mr. SPEAKER: That does not arise out of this question.

    RETAIL BUSINESS LICENCE.
    Major Earl WINTERTONasked the Minister of National Service why a retail business licence has been refused to Mr. Harry Simmins, of S. Simmins and Sons, Crawley?
    Mr. WARDLE: A retail business licence bas not been refused to Mar. Simmins. After investigation the licence desired was issued to him.

    NATIONAL SHIPYARD, CHEPSTOW.
    Mr. FORESTIER-WALKERasked the First Lord of the Admiralty whether he is aware of the conditions of the contract with the contractors at Bulwark, Chepstow; whether their contract has been cancelled; whether any offer of contract has been made involving the employment of ex-soldiers on a co-operative basis; and if so, whether he would favourably consider the same?
    Colonel WILSON: I have been asked to reply to this question. Steps have been taken to terminate operations under the contract referred to. As regards the last part of the question, I should be prepared to consider offers of the kind indicated, provided, of course, that the work would be under competent and experienced management, and that no additional cost to State would be involved.

    CONSTANTINOPLE (ST. SOPHIA CHURCH).
    Colonel WEDGWOODasked the Secretary of State for India whether he has made any representations to the Foreign Office as to the importance to the peace of India of retaining under Moslem control the ancient church of St. Sophia, in Constantinople?
    Mr. FISHER: I am very sorry, but the answers from the India Office have not come down.
    Sir F. HALL: Is the right hon. Gentleman in the habit of giving replies himself or asking for them of the officials?
    Colonel WEDGWOOD: It is not his Department.

    RUSSIA (BOLSHEVIST FORCES).
    Colonel GRETTON(by Private Notice) asked the Secretary of State for War if the Allied Forces are still in Odessa; if he can inform the House what has been the result of the fighting reported in the North of Russia; and whether the Russian Bolshevist Forces have invaded Hungary, as has been reported?
    [No answer being made,]
    Colonel GRETTON: I will ask this question on the Motion for the Adjournment of the House to-night.

    INDUSTRIAL UNREST.
    Sir H. DALZIEL: Can the Leader of the House say when he hopes to be in a position to make a statement with regard to the labour negotiations?
    Mr. BONAR LAW: I can hold out no indication of that, I am sorry to say. I am meeting the miners' representatives in a quarter of an hour, but I have nothing of which I can inform the House now.

    EGYPT.
    Colonel GREIG(by Private Notice) asked the Under-Secretary of State for Foreign Affairs whether he can make any statement regarding the situation in Egypt?
    Mr. HARMSWORTH: A statement was made yesterday in another place by my Noble Friend the Acting Secretary of State for Foreign Affairs on the present situation in Egypt, and hon. Members will no doubt be anxious to know what further information has been received from Cairo.
    I am glad to say there is every indication that the general improvement is being maintained.
    The Acting High Commissioner reports that the firm action taken by the authorities is having due effect, and Cairo and Alexandria continue to be quiet.

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    In the Behara province agricultural work appears to be proceeding normally, except in the district between Damanhour and Kafr-el-Zayat, but at the same time it is possible that the Bedouin in the Western districts of that province may attempt further marauding expeditions.
    There is no fresh news from Upper Egypt at the moment.

    MESSAGE FROM THE LORDS.
    That they have agreed to,—
    Summons and Process Servers' Fees (Ireland) Bill, without Amendment.
    That they have passed a Bill, intituled, "An Act to remove disqualifications on the ground of sex for the admission of persons to the practice of the Law." [Barristers and Solicitors (Qualification of Women) Bill [Lords.]

    STANDING COMMITTEES (CHAIRMEN'S PANEL).
    Sir SAMUEL ROBERTS reported from the Chairmen's Panel, That they had appointed Mr. Macmaster to act as Chairman of Standing Committee C in place of Mr. Brace (in respect of the Civil Services and Revenue Departments Estimates, 1919–20), and Sir Samuel Roberts to act as Chairman of Standing Committee E (in respect of the Dogs' Protection Bill).
    Report to lie upon the Table.

ORDERS OF THE DAY.
  NOTICES OF MOTION.
    PENSIONS FOR MOTHERS.
    To call attention, upon this day two weeks, to the question of Pensions for Mothers, and to move a Resolution.—[Mr. Tyson Wilson.]
    EASTERN EUROPE (BRITISH POLICY).
    To call attention, upon this day two weeks, to British policy in Eastern Europe, and to move a Resolution.—[Lieutenant-Colonel Walter Guinness and Lieutenant-Colonel Sir Samuel Hoare.]

    BUSINESS OF THE HOUSE.
    Brigadier-General CROFT: May I ask the Leader of the House whether he has received a widely signed memorial from hon. Members asking for a day for the discussion of indemnities?
    Mr. BONAR LAW: Yes; I received a letter from my hon. Friend this morning. I have sent a reply stating that if a question were put I would undertake to find an opportunity as soon as I could, but in the ordinary way I will communicate with my hon. Friend.

INCREASE OF RENT BILL
Lords Amendments to the Increase of Rent and Mortgage Interest (Restrictions) Bill considered.

CLAUSE 1.—(War Prolongation of Duration of Principal Act.)
The Increase of Rent and Mortgage Interest (War Restrictions) Act, 1915 (hereinafter referred to as the "principal Act"), and the enactments amending that Act, shall continue in force until Lady Day, nineteen hundred and twenty-one, but during the period (hereinafter referred to as "the extended period") between the time when but for this Act the principal Act would have expired and the said Lady Day the principal Act shall have effect subject to the modifications contained in the two next succeeding Sections.
Lords Amendment: Leave out the words
"the time when but for this Act the principal Act would have expired,"
and insert instead thereof the words,
"Michaelmas Day, nineteen hundred and nineteen."
The PRESIDENT of the BOARD of EDUCATION (Mr. Herbert Fisher): I beg to move "That this House doth disagree with the Lords in the said Amendment." The object of this Amendment is to substitute the fixed date, Michaelmas, 1919, for the uncertain date of six months after the conclusion of peace as the date from which the right to raise the rent by 10 per cent. commences. There are obvious advantages in the adoption of a definite and certain date in place of an indefinite and uncertain date, and this House when the Bill was being discussed in Committee did substitute Lady Day, 1921, for an uncertain date for the expiry of the Act. But I cannot advise the House to agree to this Amendment for this reason, that it involves a breach of the pledge given to tenants under the principal Act passed in 1915. That Act in fact informed the tenants who came under its protection that the rents would not be raised until six months after the conclusion of peace; consequently were we to accept this Amendment we should be depriving the tenants of the measure of protection which has been definitely promised under the Act of 1915. It is for this reason that the Government ask the House to disagree with the Amendment.
Mr. MARRIOTT: I very much regret to have heard the speech of the right hon. Gentleman. I had hoped that the Government would have seen their way to have accepted this purely elucidating Amendment. I do not want to argue it at any length, but I do suggest that the Amendment put in in another place is of very great importance simply on the ground that it would have removed one of the many elements of uncertainty which attach to the Bill, and would have opened up better prospects for both landlord and tenant.
Lieutenant-Colonel Sir S. HOARE: I hope very much the Government will maintain the attitude assumed by the President of the Board of Education. The House had an opportunity of considering this point when the Bill was in Committee, and I see no reason for altering the view we then adopted. I very much regret that the other House has taken the action it has in inserting this and another Amendment, and I hope this House will adhere to the decision it came to after due deliberation.
Mr. ROWLANDS: I am pleased to hear that the Government intend to stand by the words in the original Act of 1915, be-

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cause, while it might have been better, in the first instance, to have put in a fixed date, we do not know how long the War is going to last, and the acceptance of this Amendment from another place would rob the existing tenant of at least three months' protection against a raising of his rent. If peace is declared in June, it would be possible for the landlord to raise the rent in September, whereas under our original proposal the tenant would have been protected until Christmas. Therefore I am glad the Government are opposing this Amendment.
Mr. T. GRIFFITHS: I too hope the Government will not accept this Amendment, because by so doing it would reduce the position of this House to a farce. We discussed this point thoroughly on both sides of the House, and I trust the Government will adhere to the Clause as passed in Committee.
Mr. CLEMENT EDWARDS: I congratulate the Government on the attitude it has taken up in regard to this Amendment.
Question put, and agreed to.

CLAUSE 2.—(Limited Power of Increasing Rents during the Extended Period.)
(1) An increase in the rent of a dwelling-house to which the principal Act applies payable in respect of the extended period or any part thereof which would but for the principal Act be recoverable, shall be recoverable if or so far as the amount of the increase does not exceed ten per centum of the standard rent:
Provided that no such increase shall be due and recoverable if the sanitary authority of the district in which the house is situate on the application of the tenant certifies that the house is not reasonably fit for human habitation or is not kept in a reasonable state of repair, nor in any case until the expiry of four clear weeks after the landlord has served upon the tenant a notice in writing of his intention to increase the rent, and informing the tenant of his right to apply to the sanitary authority for such a certificate as aforesaid.
Lords Amendment: In Sub-section (1), leave out the words
"ten per centum of the standard rent"
and insert instead thereof the words
"for the period from the passing of this Act until Lady Day nineteen hundred and twenty, ten per centum of the standard rent, and for the period from Lady Day nineteen hundred and twenty until the date of the expiration of this Act twenty-five per centum of the standard rent."
Mr. FISHER: I beg to move, "That this House doth disagree with the Lords in the said Amendment."
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This Amendment raises a question which formed a matter of very extended discussion in this House. Hon. Members will recollect that an Amendment was moved from the benches opposite to reduce the increase proposed under the Bill from 10 per cent. to 5 per cent., but this Amendment would increase the rent by 10 per cent. as from the passing of the Act until Lady Day, 1920, and allow a further increase of 25 per cent. until the expiry of the Act. The Amendment, in fact, goes very far beyond the recommendation of Lord Hunter's Committee, which laid it down that the increase of 10 per cent. should not take place until six months after the conclusion of peace, and the additional 25 per cent. eighteen months after the Declaration of Peace. There is no disinclination on the part of Members of this House to realise the position of owners of house property. It is generally agreed that they are subject to greatly increased burdens in the way of taxation and in the cost of repairs, and it is true that Lord Hunter's Committee recommended an ultimate increase of 25 per cent., but it must not be forgotten that the rise was not to take place for a period of three years, and that it was to be accomplished in two stages—the 10 per cent. stage first, and the additional 25 per cent. eighteen months after the Declaration of Peace. It is the hope and belief of the Government that there will be no further necessity for this exceptional form of legislative protection after Lady Day, 1921, and the Government have consequently agreed that this protection should operate for the duration of the Bill. In view of that fact we do not think we can possibly ask the House to agree to this particular Amendment. After the spring of 1921, should it become apparent that this legislation must be extended, and if there should be no relief with regard to the scarcity of houses, the position will be again before the Government and they will consider whether owners of house property will then be entitled to any further increase of rent. But, in view of the short period to which this Bill is to be extended, we do not think we should be entitled to grant an increase exceeding the 10 per cent. which stands in the Bill.
Mr. MARRIOTT: I do sincerely hope that the House will not accept the guidance of the Government in this particular matter. This is a matter, as indeed my right hon. Friend has admitted, not of

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principle but of detail—detail on which it would be in no way derogatory to the honour of this House to give way. The principle of this Bill is, as I believe, entirely unsound. That is admitted on every hand. But, unsound though it be, it is generally accepted by all parties in this House as a necessary emergency measure in principle. Everybody agrees that you must protect tenants against a minority—I believe a very small minority—of greedy and unscrupulous landlords. That is generally, and, I believe, universally, admitted. But there is another principle which, I hope, is accepted with equal unanimity in all parts of the House. The principle is this, that you should do something to mitigate the plight—in many cases the very pitiable plight—of owners of small house property. I cannot help thinking that even now the House very imperfectly apprehends the class of landlords with whom, in the main, this Bill is intended to deal. They are not the bloated millionaires, the bloated landowners who are supposed to be exclusively represented in another place. That is not the class of landlord with whom this Bill is intended to deal. It is intended to deal in the main with small investors in small house property. Many of these small investors are people who have worked very hard all their lives who have laid by a small amount of savings. In many cases they are weekly wage earners, and in some cases small tradesmen. They perhaps live in one of the houses they have purchased, and probably devote the evening of their lives to managing the small property they have acquired.
The way in which the thing works is more or less this. Say, for the sake of illustration, that one of these small investors has saved £1,000. He buys house property to the extent, not of £1,000 but of £3,000, raising, of course, the difference —two-thirds—on mortgage. From that small property he may expect, perhaps, to get a gross rental of £150 a year. Deduct from that £150 a year, say, one-sixth, which is the totally inadequate statutory allowance for repairs, reducing the net rental, therefore, to £125. He insures his house at, I suppose, 1s. 6d. per £100, which will reduce it further by 45s.—to £122 15s. That is his net rental before he has touched his mortgage interest. Before the War, on property of that kind, a great many people were able to raise
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mortgages at about 4½ per cent., which, on the £2,000 borrowed, would be £90, reducing the net rental before the War to £32 15s. I submit to the House that that is a perfectly typical case. Now let us see what is the position of that small landlord as affected by the Bill as it left this House. Under the Bill he might be able to raise his gross rental, if he were able to satisfy—as I quite agree he ought to satisfy—the provisions in regard to the repairs and so on—if, I say, he were fortunate enough to get his 10 per cent. increase, he would be able to raise his gross rental to £165. His repairs, by general admission, instead of costing £25 a year, would certainly cost him about £50. I will ask the House to remember that the mortgage interest may be raised to anything not exceeding 5 per cent. under this Bill as it left the House. The interest, therefore, would not be £90 a year, but would be £100 a year. His insurance would similarly be doubled, if he were a prudent person wanting to replace his property in the event of fire. The total result, I believe—I have not worked out the figures—is that it would be reduced to about £10 10s. So that, whereas before the War he was in receipt of a rental of £32 15s., he would be in receipt afterwards of a rental of £10 10s. That would be the operation of the Bill if he were fortunate enough to get the maximum 10 per cent. increase allowed by the Bill as it left this House.
What is the proposal which has been made in another place? Their proposal, I submit, with all deference to what has been said by my right hon. Friend, is substantially in accord with the proposals of the Hunter Committee. I quite admit the validity of what was said by my right hon. Friend the President of the Board of Education in regard to the period covered by the Bill, but in principle the Amendment adopted in another place and sent down to this House is that which was embodied in the recommendations of the Hunter Report. What was said by the Minister in charge of the Bill in another place? The Noble and learned Lord said that the whole matter had been most carefully considered, and that the proposals of the Government were the result of compromise and discussion between persons who understand these things very well. The persons who understand these things best were the people who were selected by the Ministry of Reconstruction to serve on the Committee under the chairmanship of

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Lord Hunter, and their recommendation was, to all intents and purposes, identical with the Amendment which has been sent down to this House from another place. Therefore, I would venture to ask the House to accept that Amendment on three grounds—on the ground of authority, on the ground of equity, and on the ground of expediency. The authority was a Committee of experts who presented an all but —though not quite—unanimous Report. There was in the Hunter Committee a minority of two members, who, I believe, were supposed specially to represent the tenants' interest in the matter. [An HON. MEMBER: "No!"] Yes; and I will venture to call the attention of the House to the recommendations, not of the majority, but of the minority of the Hunter Committee.
The minority said
"We are in favour of allowing rents to rise sufficiently to meet increased expenditure on repairs."
4.0 P.M.
That is the Report of the minority. Will any Member of the House get up and say that that recommendation is met by the Bill as it left this House? [An HON. MEMBER: "Yes!"] Well, I shall be very glad to hear it argued in detail. [An HON. MEMBER: "It has already been!"] I listened to the Debate carefully and I was entirely unconvinced by anything that was said on that particular point, and I believe that the majority of people outside this House were unconvinced; but I am willing to be convinced if it can be proved that the 10 per cent. is a sufficient allowance to cover the increased cost of repairs. I shall be glad to have my figures controverted, if it is possible to controvert them.
There is one other point in the Report of the Hunter Committee. They admit, they emphasise the fact that "the first increase of 10 per cent. would largely pass to the mortgagee." That is a point almost entirely ignored in the Debates in this House. As the Bill left this House there was an allowance of an extra ½ per cent. so long as the total did not exceed 5 per cent. for mortgage interest. That is the limit. That is to say, if it was 4½ per cent. in pre-war days it will rise to 5 per cent. under the provisions of this Bill. That was the assumption on which I gave the figures to the House. Now here you have the minority Report admitting
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that the mortgage interest would by itself absorb the 10 per cent. increase in rent. How then can it possibly be contended that the 10 per cent. is also sufficient to cover the admitted increased cost of structural and other repairs? On that ground then I venture to make a very earnest appeal to the House to give some serious consideration to the Amendment which has come down to us from the other House.
Mr. LUNN: I hope the Government will maintain the position it has taken up and resist this Amendment. I do not suppose any amount of argument would convince the hon. Gentleman who has just spoken against his will. This matter was fully discussed on the 11th, and many of us on this side of the House at all events thought that no increase should be allowed. The House divided as to whether the increase should be 5 per cent. or 10 per cent., and I think the House should stand by that decision. It seems to me that the lessons of the War have not had much weight in another place, and that now, as they have always been, they are the whole-hearted defenders of vested interests. The appeal in the King's Speech seems to have been overlooked by them and in this, the first Bill that they send back to this House since the War, they have shown their interest in the same way. Personally, I see no necessity for such a place, and I would not mind if they were to be removed.
Mr. SPEAKER: The hon. Member must confine himself to the Amendment.
Mr. LUNN: Thank you, Sir. I will conclude by suggesting that this House should maintain the position as it is, and resist the Lords Amendment.
Major Earl WINTERTON: I think it would be a great pity if it went out that those who sit on this side of the House agree with conclusions at which the hon. Gentleman (Mr. Marriott) was obviously trying to arrive at in his speech. I must say I find myself far more in sympathy with what has fallen from the hon. Member opposite. I cannot understand at this time of day the motives which have induced another place, after a Bill of this kind has been discussed as carefully as it was in this House and after all the facts for and against a proposal which the Government made in the Bill were sifted as they were, to insert this Amendment.

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I must say I cannot see any reason why this House should agree with the Lords Amendment, and I think that the arguments which have been used by the spokesman of the Government, the Minister of Education, on behalf of the Government proposal, are quite unanswerable. I only rise to make it clear that if my hon. Friend has sympathisers on this side of the House they are by no means confined to the majority of those who sit here.
Mr. A. LYLE-SAMUEL: I think it was altogether appropriate that it should be the representative of the City of Oxford who supports the Amendment which has been sent to this House. The eagerness of the city of Oxford for social reform has not been prominently pronounced before, and the hon. Member for the City of Oxford would have been more frank if he had represented the case on behalf of the big landlords, which, of course, was the position taken up in another place.
Mr. MARRIOTT: No!
Mr. LYLE-SAMUEL: I heard the Debate. May I put it in another way? I think this House would not unfairly assume that it was not a special care for small landlords which induced another place to take the view it did. The hon. Member asked for the sympathy of the House on behalf of small landlords. He gave a case, and said he would be glad if anyone could dispute it. It was a case of a small investor, the industrious man who had saved £1,000. He used the phrase, "Having reached the evening of his life he hoped to be able to look after the bit of property he had been able to provide for himself." Having saved £1,000 he buys a bit of property, and he raises two-thirds on mortgage. He buys a piece of property for £3,000. The hon. Member, as I understand him, said that that property would produce £150 a year. I venture to say that it would produce from £250 or up to £300. I go further and say that when the hon. Member tells us that the 10 per cent. will hardly cover the increased cost of the raised rate of interest alone, he is surely trifling with the House.
Mr. MARRIOTT: I was giving that not as my own opinion. I was quoting that from the minority Report of the Hunter Committee.
Mr. SAMUEL: I think the hon. Member might well take his own opinion. I am quite satisfied with mine. This is matter of simple arithmetic. A half per cent. increase on £2,000 is £10 a year. A 10 per cent. increase on the part of the landlord on property bringing in £300 is £30 a year.
Mr. MARRIOTT: I dispute that. That was not my figure.
Mr. SAMUEL: It is my figure, and anybody who knows the value of small property will know that my figure of £250 to £300 is well within the mark. There are many Members in this House who have had a large experience of small property, and I think they will agree that I am well within the mark. [Mr. MARRIOTT dissented.] When the hon. Member speaks, about the Amendment being substantially in accord with the Report of the Hunter Committee. I say that it is vitally in disaccord. I would urge the Government to be adamant on this question. I can-imagine nothing more unfortunate than that at a moment like this, when the nation is "so tense," in the phrase of the Prime Minister, and when there is "so much inflammable material about," that in another place some people should make a plea for their class against the interests, of the community. I think there is nothing which the House is more anxious to do than to satisfy hon. Members who represent the Labour party that we will stand by them and secure their interests at a time when we and not merely they think we ought to have an entire revolution in the housing system of the working classes.
Mr. RENDALL: I would remind the Noble Lord behind me that, whilst landlords of small properties are not allowed to increase their rent by law, we are now enacting that large property owners may be allowed to increase their rent. I have in my own Division a landlord who is increasing the rents of his farm tenants by about 40 per cent. The sole reason for this Bill is that you cannot build houses and that you have to inflict some burden, some unusual penalty, on a particular class of persons in the country. That is admitted. The whole point is, if you are going to put that penalty on a particular class, ought you not to see that the community bears any penalty which that particular class must bear for the good of the community? If you want their property you must buy them out. If you do not, you must at least see that they are not in

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a worse position. I take this point of what the 10 per cent. actually means. I want to take a rather simpler example than the one taken by the hon. Member for the City of Oxford. I want to take the example of a house rented at £30 a year. It is admitted by everybody that the actual cost of repairs of that house before the War was £5 a year—one-sixth of the rent. It is not denied that the cost of repairs has doubled, consequently the cost of repairing this particular house has gone up to £10.
Mr. JOHN JONES: When they do them!
Mr. RENDALL: Let us suppose there is a £400 mortgage on that house, and suppose that it was at 4½ per cent. That is now raised to 5 per cent. The owner has also got to pay an increase of £5 in doing repairs, so that he has to pay £7 a year more under the operation of the Bill. Having seen what he has got to pay, let us see what he is going to get. He is going to be allowed to increase his rent of £30 by this 10 per cent., making him £33. He is going to pay away £7 more than before, and towards that £7 this Bill is going to give him £3. He is, therefore, going to be £4 worse off. Personally I defy anybody in this House to contradict the absolute truth of that statement. I am quite aware that some hon. Members and others may say, "But the landlord has not done the repairs to the house." Yes; but you are now making him under this Bill. He is not to get the 10 per cent. unless he does the repairs. That argument, therefore, has no weight at all.
Earl WINTERTON: Does the hon. Gentleman suggest that anybody here is going to be better off than before the War?
Mr. RENDALL: Nobody is going to be, in a general way. It is true enough that many persons are not better off, unfortunately; but, at all events, a great number of persons are better off through the War. The great bulk of the wage earners of the country have had their wages increased, equal probably to the extra cost of what they have to buy.
HON. MEMBERS: No, no!
Mr. RENDALL: Of course, there are bad landlords, especially—I am quite prepared to agree against myself—amongst small owners who are not very well off. I fully admit that. After all, however, you
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are dealing with the average decent owner in the main. We admit that there are certain black sheep—people who do not do their duty. If it be a fact, which is, perhaps, not altogether true, that repairs have not been done during the last four years as fully as they ought to have been, that fact is all against the owner, because if he had had them done any time two or three years ago they would have been done much cheaper than now. The repairs that have been left undone are all piling up, and have been waiting for labour and for material to be set free. I am speaking now of what I have been discussing in the way of business during the last few weeks in connection with the houses in which I am interested. These are of various kinds. I can truthfully say that if we could have done the repairs four years, three years, or two years ago, they would have been done far cheaper in respect to materials, bricks, and so on, and labour would have been much cheaper—what labour there was. But these four years of accumulations have to be attended to, and at the moment materials can hardly be got. If it is got it is quite 100 per cent. up to 300 per cent. above pre-war price, while, in nearly all these cases, labour is, at least, 100 per cent. above prewar price. Therefore, I say when you know that you are going to pass a Bill to make it the law of the land actually to take from men part of their prewar income—and this is the point I am really making!—if you are going to interfere with their trade, or business, or property, at least you should see, for the good of the community if you require their services, that you do not throw upon them a burden which will put them in a worse position than they were before the War.
If my figures are right, and I am quite certain they are, for I have been into them most closely, I would recapitulate briefly that for an actual increased payment of £7 a year you are allowing £3, and therefore leaving the small owner of a house, rented, say, at £30 a year, £4 worse off than before the War, and this at a moment when every trader, every tradesman, and every manufacturer has the right to charge more for, and get more, for all the things he sells, and when wages have gone up! I therefore venture to think that if we do not accept this Amendment from another place we shall be doing what is not right. Of course, I know we do not like being told here by another place what we are to do, but I think there are cases

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where the other place is able to advise, because Members there take more care and more trouble over the matter. [HON. MEMBERS: "Oh, oh!"] Hon. Members will pardon me, but I am sure that those hon. Members of this House who Mere present at the Debate a week or two ago here would be surprised how very few Members of this House have read the Hunter Report. It was not quoted and it would appear that it had not been read by many hon. Members. I am quite certain that in the other place the majority had read that Report. After all the Report was not that of landowners, but it was a Report specially prepared by the Ministry, by the Government. I venture to think this Amendment should be approved of. We shall be told, I fully admit, that we are going back upon what we did the other day, but I still maintain, if we do accept the Lords Amendment, we shall not be doing anything more than putting the owner of small property in exactly the same position as he was before the War.
Sir F. BANBURY: The hon. Gentleman who addressed the House from the opposite benches (Mr. A. L. Samuel) suggested that we ought to be very careful what we are doing because the country was in an inflammable state, and it was a bad time to bring forward matters which might look as if a certain class was legislating for its own interests. That seems to me to be an extraordinarily bad argument, because it amounts to this: If anybody is in an inflammable state and likely to be disorderly you are not to do the right or the just thing; you are to do whatever appeases that inflammable and disorderly person. A more foolish doctrine could never be brought forward. It was that doctrine which led to the French Revolution. It is that doctrine which, if allowed to go on here to the extent which the hon. Member opposite undoubtedly wishes, will lead to a revolution here.
Mr. LYLE-SAMUEL: May I interrupt to say that I do not accept the interpretation put on my remarks by the right hon. Baronet?
Sir F. BANBURY: The House can judge of that. The hon. Member said that it was class legislation from another place. I should have thought there were very few of the Noble Lords in another place who held small property of the description referred to in this Bill, and, as the hon. Gentleman (Mr. Rendall) said, if you hold property of a higher description,
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well, then, you can raise your rent. The hon. Gentleman also said that he did not accept the figures of my hon. Friend the Member for Oxford. He said that where you invested £3,000, the return nominally would probably be nearer £300 than anything else. I think I am not misinterpreting the hon. Member there.
Mr. LYLE-SAMUEL: £250 to £300.
Sir F. BANBURY: Well, I think the hon. Gentleman said £250 to £300, and he suggested 10 per cent. as the interest on such an amount. I do not know for certain, but I should have thought it wag very rarely that you could get that sum. I am taking now the present time for it—for I quite admit that if this Bill becomes law it is quite possible that you may buy depreciated property that will pay 10 per cent.—for the effect of this Bill will be to depreciate property. But you are dealing with people who bought property twenty, thirty, or forty years ago. I do not believe it was possible in those days to buy property paying 10 per cent., unless it were leasehold property in a bad state of repair, or with a short lease to run. Let me, however, read to this House an extract from a letter which has been sent to me from the Registrar of the Gateshead-on-Tyne County Court. I would refer it to hon. Members opposite. This gentleman writes:
"I have met with many cases where the above-named Act [The Increase of Rents Act, 1915] has worked serious injustice to landlords and mortgagees. The landlords are often much poorer than the tenants. They are often the widows and children of men of small means who invested practically all their funds in house property and small tenancies, which are now occupied by munition workers earning very high wages, out of which they could well afford to pay increased rent. In some cases the tenants have sub-let their rooms at rents which would yield a handsome profit on the rent payable to the landlord."
This comes, as I say, from the Registrar of the Gateshead County Court, a man who has great opportunities of knowing the real facts of the case, the facts which appeal to people who have to pay increased rent; not the facts of people desirous of getting votes. This is a judicial person giving his experience of actual cases which have come before him:
"The great increase in the Income Tax, cost of repairs, insurances, the cost of collection, and the cost of living, are telling very heavily upon landlords of that class. They are the majority which come before me. Mortgagees are often of the same class. Their inability to make the most of their investments is looked upon by them

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as a great hardship, especially when they know that the restriction does not apply to their richer neighbours. I am strongly of the opinion that the Act should not be extended, either as to time or otherwise.
R. PRICE."
That is a man's experience of what is going on at the present moment. In regard to the actual increase and the questions of the Hunter Report, the hon. Member opposite said that during the Committee stage in this House we divided as to whether the increase should be 5 per cent. or 10 per cent., and he argued from that that it should remain at 10 per cent. That is quite true, but when that 10 per cent. was put into the Bill as it originally passed, the extension of time was limited, so far as I know, to one year. The Hunter Report said that if it was extended for more than one year then something else should ensue. We have extended it for another period than one year; therefore it is only fair that the regulations of the Hunter Report should be embodied, and I commend this to my right hon. and learned Friend the Lord Advocate whom I am glad to see listening. I commend this to him because he has a judicial mind. I am sure he will agree with me when I say that if you alter one thing that is dependent upon another thing you must alter the second thing too. That is what the Government have failed to do. That is what the Lords have done for them. Therefore, I sincerely hope that this House will agree with the Lords Amendment.
Mr. NEIL M'LEAN: I hope the Government will stand by the position not to accept the Amendment from the other place. We have heard two or three hon. Members stating why they believed the Government should accept this Amendment from the Lords. The hon. Member who has just sat down stated that we should accept the recommendations of the Hunter Report because you had altered a certain part of the original Bill in Committee. I take it that the hon, Gentleman was present on that occasion, but I do not remember that he, at any rate, put forward any suggestions to the Government that they should embody the Hunter Report. What I want to point out here is this, that hon. Members who sit on the benches on this side believe that the 10 per cent. increase which the Bill already gives to the house-owner is sufficient. It is too much in the opinion of some hon.
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Members here, and I myself am one. I want to ask the right hon. Baronet who last spoke, as well as other Members, when he stated that some houses to which this Act will refer are houses that have been bought twenty, thirty, or forty years ago, to realise the truth that every article that is produced and every article you purchase—clothing, furniture, or food—the longer you consume it and the more you use it the less it becomes in value. On the other hand, the longer you have a house and use it the greater in value it seems to become. It is a reversion of economic value and economic law.
We believe on this side that the house owners are getting more than they are entitled to receive when they are getting this 10 per cent. An hon. Member opposite spoke of the intense atmosphere existing outside this House, but you have to remember and understand that the first Rent Restrictions Act was placed upon the Statute Book as the result of a similar atmosphere outside this House, and you cannot go back to the country after accepting this 25 per cent increase, and carry out your pledges. Under these circumstances hon. Members cannot go back to their constituencies, and especially industrial constituencies, where unemployment is rife, and where there are no longer munition workers earning such very high wages, after accepting a 25 per cent. increase. Even the right hon. Gentleman opposite admits that these munition workers were compelled to let their apartments to other people, and I would remind him that there are no high wages being paid to them at the present time. There are over 1,000,000 unemployed in the country, and if you are going to give a 25 per cent. increase to the landlords you are waving the red flag in the face of those who are creating Bolshevism, and you will be playing into their hands. You will have more rent strikes, and more agitation, and I submit if you do not wish to accentuate the trouble outside, and have the workers protesting and demonstrating, and compelling you again to pass a further Amendment to the Rent Restrictions Act within a very few weeks, you should agree to the Government's proposition, and refuse to accept the Lords Amendment and turn it down. We stand by our original proposal, and we should return this particular provision in the shape in which it left this House.
Question put, and agreed to.
Lords Amendment: In Sub-section (1), leave out the word "and" ["due and recoverable"], and insert instead thereof the word "or."—Agreed to.
Lords Amendment: In Sub-section (1), after the word "until" ["until the expiry of four clear weeks"], insert the words "or in respect of any period prior to."
Mr. FISHER: I beg to move, "That this House doth agree with the Lords in the said Amendment."
When this Clause was discussed in the House it was pointed out that although it was clear that the landlord could not raise his rent until after the expiry of four clear weeks, the question was whether after the expiry of that four weeks, he could not recover the arrears. This Amendment has been inserted to make that point clear.
Question put, and agreed to.
Lords Amendment: At the end of Clause 4, insert
"(v) At the end of paragraph (a) of Subsection (1) of Section two of the principal Act there shall be inserted the following proviso:
"Provided that if the rateable value of the dwelling-house on the said third day of August exceeds the standard lent as so defined, that rateable value shall, as respects that house, be deemed to be the standard rent."
Mr. SHORTT: I beg to move, "That this House doth disagree with the Lords in the said Amendment."
This is an Amendment which proposes to amend Section 2 of the principal Act, but it is one which we cannot accept. In the first place, it does not only apply to the principal Act, but it would have a retrospective effect, and would control the whole of the principal Act as well as any Amendments that may be proposed upon it. It is a dangerous proceeding to adopt an Amendment of that character, and for that reason the Government feel it ought not to be accepted. There is another reason which makes it imperative that this Amendment should be disagreed with. In nine cases out of ten where the rent is less than the rateable value, it means that a low rent may be charged because a premium has been paid. Now the landlord gets that premium, and if he invests it he can draw interest upon it, and therefore, if you give him the same terms you are really giving him the rent twice over. For these reasons the Government feel that the House should disagree with this Amendment.
Question put, and agreed to.
Lords Amendment: After Clause 4 insert

NEW CLAUSE.—(Restriction on Raising Assessment.)
A. It shall not be lawful during the period of the operation of the principal Act to raise the assessment (or in Scotland the valuation) for rating purposes of any house to which the principal Act or this Act applies by reason only of any increase of rent permitted by this Act.
Mr. SPEAKER: This is a privilege Amendment, because it violates our rules that the House of Lords is not entitled to amend the law of rating. Under this Amendment the law of assessment for rating purposes would be amended. Therefore it is a breach of the privileges of this House.
Mr. FISHER: I do not know whether the House will desire to discuss this Amendment. If so, I will move that the privilege be waived.
Mr. SPEAKER: If the right hon. Gentleman proposes to ask the House to agree with the Amendment the privilege will be waived, but if he does not the proper course is to move that the House doth disagree.
Mr. FISHER: Then I beg to move "That this House doth disagree with the Lords in the said Amendment."
Question put, and agreed to.
Lords Amendment: At the end of Clause 5, insert
"(3) The principal Act, both as originally enacted and as extended by this Act, shall have effect as if in proviso (vi) to Sub-section (1) of Section one of that Act after the word 'until' there were inserted the words 'or in respect of any period prior to.'
(4) Any rooms in a dwelling-house the subject of a separate letting shall for the purposes of the principal Act and this Act be treated as a part of a house let as a separte dwelling."
The LORD ADVOCATE (Mr. Clyde): With regard to the first part of this Amendment, it really only repeats the same Amendment that the House has already accepted in Sub-section (1) of Clause 2, and it really is in the nature of a drafting Amendment. I think, on the whole, it is undoubtedly an improvement in the drafting of the Bill. With regard to the second part of the Amendment, the situation is quite otherwise, for it is something new. With regard to Sub-section (3) of the Amendment, there seems no reason whatever why the House should disagree with it, but with regard to Sub-

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section (4), I am afraid there does seem to us to be reasons why the House should disagree, because it either adds nothing to the Act of 1916, under which a part of a dwelling-house was the same for the purposes of the Act as a dwelling-house, or it commits this House, and it would commit both Houses of Parliament, to an almost indefinite and quite unintelligible extension of the measure. What is proposed is that any rooms in a dwelling-house which are the subject of a separate letting shall, for the purposes of the principal Act and this Act, be treated as part of the house let as a separate dwelling. Already a part of a house let as a separate dwelling is a house for the purpose of the principal Act and for the purpose of the new Act, but this seems to propose that any letting, whether for a dwelling-house purpose ox not, provided it is a separate letting, is, for the purpose of the principal Act and this Act as well, to be treated as a house let as a separate dwelling. I cannot imagine that that was the intention of the Amendment, and whatever Noble Lord proposed it he must have had something else in his mind. As it stands it would be impossible to advise the House to accept it, and after taking some little trouble to try and understand it from the records of the Debate elsewhere, I am not conscious in recommending that the House should not agree with it that we are sacrificing any benefit we should otherwise get. I do not know of any beneficial purpose intended to be served by this proposal. I think I ought first to move to agree with the first part of the Amendment.
Mr. SPEAKER: I think the right hon. Gentleman should move to amend the Lords Amendment.
Mr. CLYDE: Then I will move, as an Amendment to the Lords Amendment, to omit Sub-section (4).
Amendment agreed to.
Lords Amendment, as amended, agreed to.
Lords Amendment: After Clause 5 insert

NEW CLAUSE.—(Limitation on Rent of Houses Let Furnished.)
B.—(1) Where the occupier of a dwelling-house to which the principal Act, either as originally enacted or as extended by this Act, applies, lets, or has before the passing of this Act let the house or any part thereof at a rent which includes payment in respect of the use of furniture,
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and it is proved to the satisfaction of the County Court on the application of the lessee that the rent charged yields to the occupier a profit more than twenty-five per cent. in excess of the normal profit as hereinafter defined, the Court may order that the rent, so far as it exceeds such sum as would yield such normal profit and twenty five per cent., shall be irrecoverable, and that the amount of any payment of rent in excess of such sum which may have been made in respect of any period after the passing of this Act, shall be repaid to the lessee, and, without prejudice to any other method of recovery, may be recovered by him by means of deductions from any subsequent payments of rent.
(2) For the purpose of this Section "normal profit" means the profit which might reasonably have been obtained from a similar letting in the year ending on the third day of August, nineteen hundred and fourteen.
Mr. FISHER: I beg to move "That this House doth disagree with the Lords in the said Amendment."
This Clause has been drafted with a view to dealing with an undoubted abuse of the existing Act which has sprung up. A tenant whose rent is limited by the Act often sub-lets the house furnished at an exorbitant rent, and this Clause enables the County Court to cut that rent down, if it exceeds such sum as would yield such normal profit and 25 per cent. The Government, after very careful consideration of this Amendment, which deals with an undoubted grievance, have decided that they must ask the House to disagree with it. In the first place, the principal Act distinctly excludes furnished houses from the sphere of its operation, and it would undoubtedly be very inconvenient in a Bill framed for the purpose of extending the provisions of the principal Act to take into our purview circumstances which are distinctly excluded. In. the second place, this Clause under Sub-section (2) imposes a duty upon County Court judges which we feel it would be unreasonable to impose. I put it to the House: How can a County Court judge arrive at a decision as to what would be a profit that could reasonably have been obtained for a similar letting in the year ending 3rd August, 1914? If I may quote the words of an old English writer, he would require "the patience of Job and the wisdom of Solomon." For these reasons I move that the House disagree with the Lords in the said Amendment.
Mr. RENDALL: I am sorry that the right hon. Gentleman is not able to accept this Amendment, and all the more because in the Debate on the Second Reading in the House of Lords it was explained that at the time the principal Bill was intro-

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duced it was understood that these cases would be covered by it. It was stated that it was very regrettable, when a Minister in charge of a Bill made a statement about the meaning of it, that the Bill should not be on all fours with that Minister's statement, and it was hoped that the Lord Chancellor would put the matter right. The Lord Chancellor, in the speech which he made was very sympathetically inclined towards this Amendment. He said that the Government draughtsmen would try and have the matter put right. As a result this Amendment has been most carefully drafted and put down. Now, my right hon. Friend says that it is going to be rather troublesome and would throw a burden upon the County Court judge, but that is no reason for not doing it. When we found that the principal Act was not protecting people against all sorts of abuses and that persons were going from town and buying houses because the principal Act allowed them to turn the tenant out if they bought the house, we very quickly took the trouble to pass another Act to prevent it. One of the greatest abuses from which the owners of small properties have suffered has been the great injury done to their properties by sub-tenants. It has been prevalent in all munition areas, and practically in every part of England, to let lodgings. I do not think I should be putting it too high if I said that 25 per cent. of these tenants have been letting lodgings during the War, and letting them at very high rents indeed. I have had brought before me instances in my own Division where the Weekly rent has been 8s. or 7s. 6d. per week, and where the tenants have let two rooms at 15s. per week each. In other words, the tenant has turned himself into a landlord to the extent of 30s. per week, whereas the owner has only got 8s. The result of allowing these tenants to sub-let has been, of course, to cause a great deal more wear and tear to the houses. Naturally a subtenant, who has a room and is paying 15s. per week for it, thinks that he is paying a very good rent indeed, and he naturally does what he likes in the room. A great deal of wear and tear has, therefore, resulted from sub-letting. We now have an Amendment which really seeks to deal with the matter, and, if I remember rightly, it was passed unanimously in the other House. It had the sympathy of the Lord Chancellor, and the Government's usual supporters were in favour of it. Now when it comes down here the right
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hon. Gentleman, because it would be difficult to find out what was the normal profit in 1914, says that the Government cannot accept it. It would be very simple to amend this Amendment and make the normal profit definite by saying that if the weekly rent was 7s., then the normal rent of a room should be so much, and, if the normal value was 15s., that the letting value of a room should be so much more.
There would be no difficulty in amending this Clause so as to protect those who are hit, and who will be hit if it is not done. The Government, however, have not shown the smallest desire to be fair in this matter. They want to do something which is extremely popular with a large number of persons absolutely regardless of justice. Apparently, they are going to continue that course to the end. I very much regret that the Minister of Education has been associated with this Bill, because his past career would have led us to hope that he would not behave like this on a Bill of this kind if he could possibly avoid it. It is no use, however, crying over spilt milk, and he has been spilling milk the whole time that the Bill has been under discussion. I hope that he will see fit to reconsider the matter and do what the Minister in the House of Lords said should be done. In my opinion, it has not been fairly considered. No attempt has been made to amend the Amendment to enable it to be carried out. The right hon. Gentleman has merely said that it would be difficult, in spite of the fact that County Court judges are not very busy just now, because the ordinary commercial work has not come back to them. They could very well deal with this war emergency work, and deal with it quite equitably. I, therefore, very much regret the Government's decision, and still hope that they will reconsider the matter.
Earl WINTERTON: I may say that, as regards my own pocket, I am exceedingly prejudiced by the whole Bill, but I entirely and totally disagree with what has been said by the hon. Member as to the unfair attitude that the Government have taken up on this Amendment. Throughout the Government have taken up a perfectly fair and logical attitude, and I am surprised that one with the point of view of the hon. Member should wish to see the Government adopt a proposal which would practically make the County Court a Rent Court. It is not the function of the

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County Court to decide the sort of matter that it would have to decide if this Clause were adopted. Surely the whole Amendment is getting away entirely from the real scope of the principal Act and of this amending Bill. What was the object of the principal Act? It was to deal with specific cases of hardship which arose in the letting of small unfurnished houses. It had no reference to the letting of furnished houses. No doubt what the hon. Member has said is true, but that matter should be dealt with by a Housing Bill and not by an amending Bill which applies merely to unfurnished houses. I think the right hon. Gentleman the Minister of Education is not going too far when he says that it would require qualities which certainly do not exist in the ordinary County Court or County Court judge. I should say that the ordinary County Court judge would be incapable of deciding the questions that he would be asked to decide under this Section, and I hope that the House will disagree with the Lords Amendment.
Mr. HOLMES: I hope that the House will not disagree with the Lords in this Amendment. The object of this legislation has been to prevent profiteering in unfurnished houses. We now have an Amendment from the Lords to prevent profiteering in furnished houses. The Amendment will prevent anyone making a profit of more than 25 per cent. out of the letting of a furnished house. The Minister for Education says that it is a good Amendment which has a good principle in it, and the one reason that he advances for rejecting it is that the County Court judge would be called upon to say what was the normal rent which could be obtained for that furnished house on 3rd August, 1914. I am not a lawyer, but I believe that lawyers would advise us that in this country the plaintiff in any action must make out his own case. The onus rests upon him to prove his contention. Therefore, it would rest upon the plaintiff to show the normal rent on 3rd August, 1914, and whether that normal rent had been exceeded by more than 25 per cent. The plaintiff would do so by bringing forward evidence of the letting of furnished houses in the locality in August, 1914, or before. He would be able to go to the local house agents and subpœna them to appear. The County Court judge would not have to decide what was the normal rent; he would
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merely hear the evidence and decide whether the plaintiff had proved his case or not. I do not think, therefore, that there is anything in the objection which the right hon. Gentleman has urged, and I hope that the House will not agree with the Government proposal.
Question put, and agreed to.
Lords Amendment: After Clause 5 insert

NEW CLAUSE.—(Application of Act to Ireland.)
In the application of this Act to Ireland:

(a) The first day of May shall be substituted for Lady Day in the case of tenancies where the former day is the gale day;

(b) The medical officer of health of a dispensary district shall be substituted for the sanitary authority in Section two of this Act, and the issue of certificates and the payment of fees in connection with applications by tenants under the said Section shall be subject to regulations to be made by the Local Government Board for Ireland.

The SECRETARY of STATE for the HOME DEPARTMENT (Mr. Shortt): I beg to move, "That this House doth agree with the Lords in the said Amendment." This is really an Amendment relating to the machinery for applying the Act in Ireland.
Question put, and agreed to.
Lords Amendment:

NEW CLAUSE.—(Amendment of Definition of Standard Rent.)
D. At the end of paragraph (a) of Sub-section (1) of Section two of the principal Act, the following words shall be inserted:
Provided that in the case of any dwelling-house let at a progressive rent payable under a tenancy agreement or lease, the maximum rent payable under such tenancy agreement or lease shall be the standard rent.
Mr. CLYDE: I beg to move, "That this House doth disagree with the Lords in the said Amendment."
5.0 P.M.
I understand that the motive behind this Amendment was in every respect an excellent one. The idea, I understand, was that there are cases in which philanthropic building schemes, either for veteran soldiers or for others, have been already started, and are now in operation, in which the arrangement is that the rent is what I think this Section means by the word progressive, that is to say, the rent begins at a comparatively small figure and gradually rises from year to year. As expressed, of course, the Amendment is altogether unlimited and would apparently apply to any case in which the rent stipulated for was liable to change, either

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annually or otherwise, by way of increase from time to time. It would apparently apply, for instance, to the case of a tenancy which was fixed at X pounds for three years of the first three years of the period covered by it, and then was to increase to X plus Y for the next term of years under the tenancy. Therefore, obviously, in any view it is framed far too widely, but the question really is whether the House shall be recommended to accept this Amendment at all. I think the ruling consideration in making up one's mind about that question ought to be this, that this is, after all, only an amending Bill to the Act of 1915. We made no exception of this kind in 1915, and it seems a very doubtful thing to introduce exceptions of this kind in this amending Bill in 1919. I have no doubt that if this kind of legislation were intended to form a permanent part of our law in this country it would be necessary to face the case which I understand this Amendment was introduced in order to meet. But this Bill, just as much as the Act of 1915, is intended to meet an exceptional state of affairs, and is in turn temporary in its application. Therefore, on the whole, it seems to us that it would be unwise to attempt to do in 1919 partially what this House did not think fit to do at all in 1915. In any case, the area which would actually be covered by this Amendment is exceedingly small, and, on the whole, we recommend the House not to agree with the Lords Amendment in this respect.
Question put, and agreed to.
Ordered, That a Committee be appointed to draw up Reasons to be assigned to the Lords for disagreeing to certain of their Amendments to the Bill.
Committee nominated of,—Mr. Fisher, the Lord Advocate, Mr. Acland, Mr. William Graham, and Colonel Nicholson.
Three to be the quorum.
To withdraw immediately. — [Lord Edmund Talbot.]

NAVAL, MILITARY, AND AIR FORCE SERVICE BILL.
As amended (in the Standing Committee), considered.

NEW CLAUSE.—(Discharge, of Soldiers.)
A person discharged after the passing of this Act shall not be deemed to be re-enlisted under the Military Service Acts, 1916–18.—[Mr. G. Locker-Lampson.]
Brought up, and read the first time.
Mr. G. LOCKER-LAMPSON: I beg to move, "That the Clause be read a second time."
In moving this new Clause, I need hardly say that I am entirely in sympathy with the principle of the Bill, and that I am not moving this with any feeling of hostility towards the Bill. I am simply moving it to enable the military authorities to do a certain thing which they are not able to do at present. The present state of the case, to my mind, is very unsatisfactory. If a man is discharged to-day by the military authorities he does not get a clean discharge. Under Section 1 of the Military Service Act, 1918, if he is discharged to-day he becomes automatically and immediately re-enlisted, and is passed into Class B of the Reserve, and if the military authorities demobilise him he again does not get a clean discharge but is passed immediately into Class Z of the Reserve, so that under the present system the military authorities, even if they want to do so, cannot give a man a clean discharge. It is perfectly clear that the military authorities really do not want these men whom they are demobilising. If they really wanted them I should not propose this Clause. They have lately issued an Army Order, No. 1 of 1919, which says that when these men are demobilised there is nothing to prevent them going abroad, re-settling in civil life, or emigrating to any part of the world, and that the only obligation on these men is that on passing into Class Z of the Reserve they must notify their changes of address to their record offices. I do not in the least know how my right hon. Friend the Secretary of State for War is going to enforce this notification. I do not believe for a moment that he will be able to enforce it, and if under this Army Order the military authorities are going to allow these men to emigrate to any part of the world they like, they cannot really say that they want these men for military purposes. Why not, therefore, give them a clean discharge? Why does not my right hon. Friend give himself the power, where he wants to do so, to give these men a clean discharge and rid his hands of them altogether? I should like also to make this point. He creates in this matter a difference between officers and men. I am quite sure that my right hon. Friend does not mean to differentiate between men and officers in this respect, but under Army Order 10 of 1919 officers cannot be com-

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pulsorily put into the Reserve at all. They can either claim full pay while they are on the Active List, or they can be gazetted out altogether. Therefore, why should my right hon. Friend treat an officer differently from a private soldier in this respect? He can give a clean discharge to an officer, but under the present state of the law he cannot give a clean discharge to a private soldier, and, after all, these men have fought just as well and have gone through just as much hardship as the officers, and I am rather surprised that my right hon. Friend should make this difference. I do not think he is doing it intentionally. The present state of the law is rather complicated, and he may not realise that in fact he is able to give a clean discharge to an officer, but not to a private soldier. If the Government do not want to keep the men—and I do not believe they do—why hang a sort of sword of Damocles over their heads, which merely frightens and unsettles them? I can see no reason for it whatever, and I therefore hope the Government will accept this Clause.
Mr. SPEAKER: Is the Motion seconded? [No seconder.]
Sir D. MACLEAN: I rise, Sir, to move the Amendment which stands in the name of the hon. Member for East Edinburgh.
Mr. LOCKER-LAMPSON: On a point of Order, Sir. My hon. Friend beside me (Major Hayward) rose directly I sat down in order to second my Amendment. You may not have noticed him, but he rose directly.
Mr. SPEAKER: I assure you he did not. I said, "Is that seconded?" and, as nobody rose to second it, I then said, "Sir Donald Maclean." The hon. and gallant Member then rose.
Mr. LOCKER-LAMPSON: That was for the second time, Sir.
Mr. SPEAKER: I did not hear a word come from his mouth.
Major HAYWARD: Immediately my hon. Friend suggested that I should second his Amendment, I jumped up, and said, "I beg to second it." Then I sat down, and I rose again a second time.
Mr. SPEAKER: I accept the statement of the hon. and gallant Gentleman. Will he make his speech now?
Major HAYWARD: I formally second the Motion.
The SECRETARY of STATE for WAR (Mr. Churchill): My hon. Friend told the House that this Bill creates a difference between officers and men which his Clause will correct.
Mr. LOCKER-LAMPSON: No, I did not say that. I said the present law created a difference between officers and men.
Mr. CHURCHILL: At any rate he said his Clause would tend to rectify the difference. I think it would be unfortunate if that impression got abroad. As a matter of fact, officers are being freely discharged from the Army because there are more officers volunteering to stay in the Army than the Army requires, and it would be foolish and unwise to keep officers when we do not require them. On the other hand, so far as the arrangements for demobilisation are concerned, the proportion of men discharged from the Army far exceeds the proportion of officers. Officers are being retained to a much larger extent than men are. Therefore, to try to make out that officers are being favoured at the expense of the men is entirely erroneous, and if it received any credence outside the effect would be mischievous. The principle on which they are proceeding in this Bill is that we do not in any way repeal or alter the obligation of the citizen under the existing Military Service Acts. This obligation remains until the date of the ratification of peace. As we cannot tell at what date the ratification of peace will take place we are preparing this new Bill, which will come into effective operation when the ordinary Military Service Acts lapse. There is no reason, therefore, for differentiating in any way between men who are discharged from the Army before the passing of the new Bill and those who are discharged after the passing of the new Bill. My hon. Friend proposes that men who are discharged after the passing of the new Bill should not be eligible to be called up, whereas men discharged after the passing of the Bill would be so eligible. That would be to introduce a most undesirable distinction between two classes of men on no ground of logic, equity, or public policy that I can see. The principle on which we are acting is perfectly simple. We do not expect that anyone will be called up, but as long as they are liable to be called up under the existing Military Service Acts we do not interfere with that

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liability. When the existing Military Service Acts do lapse on the ratification of peace men will only be held under the present Bill, and the new Bill has no power to call any man up in any circumstances on remobilisation, and new legislation would be necessary for the purpose. There is really no substance whatever and no real need for the new Clause.
Mr. LOCKER-LAMPSON: Is it not a fact that an officer now gets a clean discharge and a private soldier does not? That is the point.
Mr. CHURCHILL: The officer is serving under a different contract of service altogether and under different conditions, but the fact remains that men are getting discharged in far greater numbers in proportion than officers are.
Question put, and negatived.

CLAUSE 1.—(Power to Prolong Period of Naval, Military, or Air Force Service.)
(1) If the competent authority is of opinion that, as respects any men to whom this Section applies or any class of such men, they cannot consistently with the public interest be released from actual service at the time when in pursuance of the terms of their service they would be entitled to be discharged, any such man may be retained and his service may be prolonged for such further period, not extending beyond the thirtieth day of April, nineteen hundred and twenty, as the competent authority may order, but at the expiration of that period, or at any earlier date at which the competent authority considers that he can be released, he shall be discharged with all convenient speed, but in no case later than three months after the thirtieth day of April, nineteen hundred and twenty.
Sir D. MACLEAN: I beg to move to leave out the words "the competent authority is of opinion that, as respects," and to insert instead thereof the words, "at the termination of the War."
This Amendment, taken with the two succeeding Amendments, would make the Clause read as follows:
"If at the termination of the War any men to whom this Section applies, or any class of men cannot in consequence of the failure to obtain voluntary recruits for the period mentioned in this Act be released from actual service."
These Amendments simply raise the point that voluntary service should have an adequate trial before this Bill, with its compulsion, comes into operation. I think the Government was morally pledged to some such experiment as this if the Military Service Acts had to be carried on to their natural termination. Certainly, during the General Election, and for some period after that, there is no doubt at all that a
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clear and definite impression was left upon the public mind that as far as the Government was concerned there would be no more Conscription. It is quite true that by rather fine distinctions and a meticulous interpretation of phrases it might be argued that they did not quite mean that, but there is not the slightest doubt that the ordinary man and woman thought there was going to be no more compulsory military service. I hold that it was morally incumbent upon the Government, before they came to the conclusion that it was absolutely necessary to have compulsory military service for garnering the fruits of victory, that they should have put forth a full, enthusiastic effort to get men by voluntary means. The effect of that would have been that you would have got a measure of public unity behind you in any necessary measure you had to take for compulsory military service. I am quite certain that if a real, fair attempt had been made—with regard, certainly, to some of my hon. Friends who associate themselves with me, in almost any event they would say they would never consent to do it—apart from a comparatively small minority of that kind, you would have had a great solid mass of public opinion behind you, realising that in the public interest it was necessary to adopt this step which we all, including, I am sure, the right hon. Gentleman (Mr. Churchill) and all those who work with him, regard as a regrettable step to be compelled to take. So much for the point as to what I suggest was a moral obligation upon the Government to have made that experiment.
Would it have been successful? I believe it would. If the Government had given to the men in the Army to-day, serving in all the theatres of war, adequate pay and proper conditions of service, combined with a patriotic appeal, not only to the men in the Army, but the men outside the Army who had not yet served, I think there is not any real doubt that they would have had a splendid response to their appeal. I dare say the Minister in charge of the Bill would say, "Suppose we had offered inducements on pretty large and substantial lines, how does that compare with the demand which I have been compelled to make for the Army?" With such information as I have I say the demands which the right hon. Gentleman has laid before the House for men are over-insuring the risks which this country is subject to in connection with the future of the relations between ourselves and

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our enemies. What is the position in regard to Germany to-day on the Western Front? There is a rapidly disappearing German Army standing at a total, reckoned some six weeks ago, of somewhere about 850,000 men. There is no German Army in anything like an adequate military sense of the term. So far as one can judge, unless there is some very special information which my right hon. Friend possesses, it is rapidly degenerating into a disorganised mob. What is the proposal, not for next year or the year after, but for the immediate future of that Army? That it should be reduced to 100,000 men, with guns and all the ancillary arms of the Service proportionately limited. How is it going to be recruited? Very rightly they are going to recruit that army on the long-service system. There is going to be no young crop of young men coming up, because they desire to carry out the policy, if possible, of uprooting militarism in Germany, apart from any other offensive capacity of the German nation in a military sense. The German Navy, too, has practically disappeared, and no submarines are to be allowed. They go so far in the way of uprooting the military system that they propose to disallow the formation of Boy Scouts and every organisation which might suggest the military spirit. What is facing the collection of men to-day that we call an Army? Millions of armed, highly-disciplined men from the United States, France, ourselves, and Italy, totalling somewhere about, two to six weeks ago, 13,000,000 men. I do not know what is on the Western Front—say 3,000,000 men fully armed in every sense of the term. To meet that risk the Secretary of State for War is grossly over-insuring at the cost of a serious infraction of our national unity on this point. Can anyone doubt it? Wherever one turns—election results, public meetings, members' post-bags since this Bill was introduced—I am sure every hon. Member has had protests from his constituents. [HON. MEMBERS: No!] I am wrong, then. I must accept that denial. I will only speak for myself and a very large number of my friends.
The position is really a serious one. What attempts have been made to deal with it on voluntary lines? My right hon. Friend will, no doubt, say he has made sufficient attempts. What attempts were they? In the early days after the Armistice a bounty system was introduced, with
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unsatisfactory results. Then the Secretary of State for War attended a meeting at the Mansion House and made a statement of very great national and international importance. He said that a recruiting system had been set up whereby new pay and vastly improved conditions were offered to the men, and the men were then streaming in at the rate of 1,000 a day. I think a lesser number has also been stated. At the same time he said—I am not quoting his exact words—that this influx of troops by voluntary enlistment would by no means meet the situation, and he foreshadowed the Bill with which we are now dealing. If at that time, or a month earlier than that, the War Office had seriously grappled with this matter and had shown one half of the energy and enthusiasm which was associated with what we know as the Derby scheme, there would not only have been a thousand, but two or three thousand men pouring in.
What is the position in which we find ourselves at the present moment? Unemployment is rife, and I fear, no matter what steps the Government may take now, that at no distant date it will be rampant. If the voluntary system was now in operation for securing men for the Army you would have got a very large number of the very best class of recruits for your service abroad. If you had limited it to a year's service, what a chance would have been given to the War Office of avoiding this Bill, which, I fear, is going to do so much to upset the national temper, to cause discontent in the Army, and in many senses to lessen our national powers in dealing with the problems which await us at home and abroad. I need not dwell upon this point. The full opportunity was not taken of getting men by those means. It ought to have been done in the interests of the Army, in the interests of the nation, and in the interests of keeping faith. It is not too late now. Is it? I do not know. Of course, this Amendment will be beaten by a huge majority; but very few of the men who will go into the Lobby will not agree with what I say, and believe in their heart of hearts that the voluntary system ought to have had a fair trial.
Colonel PENRY WILLIAMS: I beg to second the Amendment.
Mr. CHURCHILL: The right hon. Gentleman seeks by this Amendment on Report to re-try, as he has already sought in Committee upstairs, the main issue which was

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decided by the House on the Second Reading of the Bill. His Amendment is a definite challenge to the Bill. If it were accepted by the House, it would wreck the Bill. It is intended to wreck the Bill; intended definitely to challenge the whole basis of argument and the whole accumulation of public needs for the satisfaction of which this Bill has been introduced. I am sure the right hon. Gentleman would not dispute that. The Amendment would not only wreck the Bill, but that it would wreck it by reducing it to an absurdity.
Sir D. MACLEAN: It is quite open to the right hon. Gentleman to say that the effect of my Amendment would be to wreck the Bill. That is quite legitimate; but I protest against his saying that my intention is to smash the Bill; I think this Bill could be made effective with this Amendment.
Mr. CHURCHILL: Here is the right hon. Gentleman moving an Amendment the effect of which he knows will wreck the Bill, and yet he says he has no intention of wrecking the Bill. He must be presumed to understand the consequences of his action.
Sir D. MACLEAN: I take them.
Mr. CHURCHILL: If he, with all his Parliamentary experience and the position of responsibility that he occupies at the present moment, introduces an Amendment the effect of which he knows will wreck the Bill, it is a reasonable deduction for the House to make that it is his intention to wreck it, and I do not think we need waste much time in arguing that point. He made two charges against the Government and against the policy which has brought this Bill forward. In the first place, he says we have not tried the voluntary system. There is no truth in that accusation. The Government have tried very hard to obtain men by every means under the voluntary system. They are trying very hard to obtain men under the voluntary system, and they will continue so to do. Before I went to the War Office a scheme was spread about tine whole Army, offering substantial bounties and substantial periods of furlough to men who would re-engage for two, three, or four years. Unless men do re-engage for two years we cannot give the relief where it is most wanted, namely, by the Territorials and others who are still left in India and for whom we have the utmost necessity of providing effective relief.
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This scheme only resulted in securing 10,000 or 11,000 men. Therefore it was a complete failure; but to say that it was not a bonâ fide attempt to obtain men under the voluntary system is quite inaccurate. We then started a new principle. We increased the pay of the Army and renewed the bonuses and the bounties and we have been, I think, very successful. We are now, as I said at Question Time to-day, securing men at the rate of nearly 1,000 a day. If that irate continues it will greatly assist us in the task with which we are concerned. In addition to the men who are re-enlistng for short periods of two, three, or four years, we have the ordinary enlistment for recruits of eighteen, who enlist for seven years with the Colours and five in the Reserve. There also we have had very satisfactory results. They, of course, benefit by the present high rates of pay. They are getting much better rates than have ever been offered before for the untrained youth. These young recruits, judging from the results of the last few months, are now being enlisted at nearly double the rate before the War began. In order still further to increase the supply of men by voluntary service, I have taken the step of opening recruiting for youths of seventeen, who will be allowed to recruit on the basis of nine years with the Colours and three years with the Reserve. Of course, we shall have to train these men and feed them for two years before they will be any real use to us. However, in order to get the largest number by voluntary means we have taken this step of opening up enlistment at seventeen years.
Captain WEDGWOOD BENN: Can the right hon. Gentleman say, approximately, what is the total daily number of enlistments?
Mr. CHURCHILL: I did that at Question Time. If the hon. and gallant Member had been in his place then he would have heard it. I said that the total daily number this year averaged 935 and for the last three days we have been recruiting an average of slightly over 1,000. I think the right hon. Gentleman (Sir D. Maclean) has not measured his words in exact conformity with the facts, or done full justice to the position of the Government in saying that we have not endeavoured to secure men by the voluntary system. Only this morning I was passing another advertisement which is

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to be widely inserted. Many thousands of pounds have been spent in the advertisements we have inserted in the newspapers in pursuance of our recruiting campaign. I propose to continue this system; I thoroughly agree with it. We must do everything in our power to recreate our voluntary Army at the earliest possible moment and I repudiate the idea that we have not done our best and are not trying to do our best.
The second charge made by the right hon. Gentleman is also fatal to the principle of the Bill. He says that we are grossly over-insured. I wonder the right hon. Gentleman follows at all what is taking place in almost every country of Europe at the present time. How anyone can say that we have grossly over insured when we are seeking to keep 900,000 men during these critical and perilous months, a large proportion of whom are engaged in non-combatant work necessary to demobilisation, looking after horses, motor cars, and salvage work. How he can say we are over insured with nine divisions on the Rhine and the equivalent to four divisions in this country, less than we had in the peaceful days before the War. How anyone can say that we are over insured passes my comprehension. Only a few days ago we had a situation developed in Egypt which was a very far reaching danger and which made it necessary to make an appeal to the men who were collected at the ports for demobilisation to go back to help their fellow countrymen and their comrades from being murdered. There the whole country is in a state of practical insurrection. Has the right hon. Gentleman read what is taking place on the Black Sea, what is taking place in Hungary, what is taking place on the whole frontiers of small States who are guaranteed by the League of Nations to be protected? Does he not follow any of these consequences? The right hon. Gentleman says that the German Army is to be reduced to 100,000 men and that they are to have no boy scouts. That is what we are going to demand. Have they agreed to that. Is there any chance of their agreeing to it if we divest ourselves of our military forces at the present time? The way the right hon. Gentleman argues would lead one to suppose that everybody ought to be demobilised and disarmed except Lenin and
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Trotsky. The Government have to face very real and terrible emergencies at the present time. It is easy to squander your military forces; it is perfectly easy to open your hands and to relax control and let your Army disappear, but if you do that before you have got your terms, with the state of Europe as it is, one of increasing gravity and increasing perplexity, then you will throw away with both your hands day by day, and portion by portion, all the results which have been gained by the sacrifices of millions of men in four and a half years. So much for being over-insured.
What is the method which the right hon. Gentleman seeks to adopt in order to give satisfaction to himself in regard to the charges he has thought fit to make against the Government? It is the most absurd remedy that it is possible to put on the Notice Paper of the House. I do not know whether the House has followed the full meaning of the Amendments which are consequential on the Amendment which the right hon. Gentleman has moved. He proposes to leave out the words, "If the competent authority is of opinion that," etc. By so doing he destroys the tribunal, as existing already, which is to judge whether a man under this Bill should be retained or not, and he makes each individual case a case for trial before some other tribunal which he makes no attempt to specify. If his Amendment were adopted, it would be a matter for the Courts in the case of each individual soldier as to whether there was a real necessity to retain him or not. Such a problem has never been put to Courts before. On the mere face of it it is one which it is almost impossible for a tribunal to decide. The right hon. Gentleman goes further, and gives guidance to the Court as to what is to influence them in their decision. They are to be influenced in their decision in each individual case by being satisfied as to whether sufficient effort has been made to obtain men under a voluntary system. What an issue to be put before a tribunal! Each individual case is to be tried according to the fact as to whether the Government have made sufficient efforts to obtain men under the voluntary system. I submit that the right hon. Gentleman's Amendment is, as he has admitted, designed to wreck the Bill, and it is extremely well designed for that purpose; and this Amendment is an attempt to retry, in the course of the Report

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stage, the issue which has already been decided on Second Reading by an overwhelming majority.
Captain W. BENN: The House will understand, I am sure, that it is a very difficult task for an inexperienced Member, as I am in debate, to attempt to answer an experienced right hon. Gentleman like the Secretary of State for War, but I would like him to understand that there is a body of opinion in the country, even if it has but a small representation in this House, which is utterly opposed to this Bill and which thinks that it is a fraud. The right hon. Gentleman says "you are going to take away all our troops when Germany has not yet consented to the terms of peace." That is not so. The right hon. Gentleman knows perfectly well that the existing Military Service Acts will hold every single man in the line until the terms of peace have been ratified by Germany. Moreover, we know well that even when a man is entitled to be demobilised that it is a very different thing from being demobilised. Half a million men who are entitled to be demobilised at present are still hung up because they are wanted as batmen or for some indispensable job in the unit with which they are connected. The right hon. Gentleman has got his Army untouched until peace is ratified, which may be six or nine months hence. In addition to that, he has constantly coming up to their support these voluntary recruits who are coming in at the rate of 1,000 a day. That is a substantial force, and at any rate my opinion is that these figures should be sufficient to support any military policy which this country is justified in undertaking.
We think that we are going down a steep place to ruin, both with the expenditure of men and these gigantic swollen figures for an Army which the right hon. Gentleman has made no attempt to justify. Look at the list. The Rhine: We are to have nearly half a million men—four hundred and three thousand, costing, I suppose, half the estimate, we will say £200,000,000 per annum, to secure whatever indemnity we are going to get out of Germany, although the Government is rather shy of telling us what the indemnity is. Then Italy: 10,000 men are required to be retained in Italy in peace time. Why? I have never heard any information from anybody. Then Bulgaria and Turkey 100,000 men. That will cover Mesopotamia and Persia. We are going to hold
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new territory as a mandatory power for the League of Nations. That is our policy, as I understand. Does it really mean that the new system involves on the mandatory power larger forces than if that power were holding the territory as its own possession? If so, it is a very poor look out for the League of Nations or for the peace that is to be established. Then we come to Egypt. The right hon. Gentleman has got a wonderful case in Egypt. He says that the place is in a state of insurrection. That does not agree with what the Under-Secretary for Foreign Affairs said at Question Time to-day. He said that things were quieting down, but I want to suggest has the right hon. Gentleman thought that the unrest in Egypt is not unconnected with the maintenance of military rule in Egypt?
I spent two years in Egypt. Of course anyone is foolish who speaks with confidence of a country like that after such a brief experience, but in my judgment Egypt would have been better to-day and more peaceful if the Government of Egypt had been left in the hands of the Civil servants who understand it, and if Egypt had not been flooded with British generals. At one time there were 119 English generals in Cairo, after the evacuation of the Dardanelles, of which perhaps the right hon. Gentleman has heard, and they were superseding the ordinary Government of Egypt, and Egypt would be far more peaceful to-day if instead of the ignorant rule of military generals it had been left to the rule of those sympathetic and experienced Civil servants who have proved themselves to be successful administrators. The right hon. Gentleman has taken 100,000 men already to keep Egypt in subjection. The figures are, Egypt and Palestine, 103,000 men.
Mr. CHURCHILL: I think the hon. and gallant Gentleman is reading from Vote A. Vote A includes a large number of natives. This Bill deals only with the number of whites. In Egypt the number is very much less than the figure which he has taken.
Captain BENN: This includes 56,000 British, and about 40,000 Indians, but that does not affect my point, which is that the right hon. Gentleman made an attack on my right hon. Friend because he said you do not want such forces in Egypt. The right hon. Gentleman says, "Egypt is in a state of insurrection, and you will not give us the men to put it down." He asks

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for over 100,000 men for that purpose. Lord Wolseley beat Arabi and took Egypt with 16,000 troops, and Cairo was taken with two squadrons of Cavalry. The right hon. Gentleman wants 100,000 men to keep Egypt in subjection after four years of war.
Brigadier - General CROFT: And Palestine.
Captain BENN: The hon. and gallant Gentleman says Palestine as well.
Brigadier-General CROFT: And Syria.
Captain BENN: I do not think that the case which I am trying to make as regards Egypt is exaggerated, but even if it were I do not think that those who speak with great experience will deny that there is truth in what I say. The right hon. Gentleman's other bogey is Bolshevism. Have we heard what happened in Hungary? Certainly. They have raised thirty-six battalions of Bolshevik forces. That was in the papers yesterday. The Bolshevik does not attack a country on the external front, but on the internal front. I do not know whether the right hon. Gentleman is going to have Conscription to fight the Bolsheviks, because we were given to understand that only people who wanted to go out and be frozen in Archangel would be asked to do so; but if the right hon. Gentleman is going to use his conscripts against the Bolsheviks, I think, perhaps, that that ought to be made clear to the country. The fact is that the ally of the Bolshevik is not an armed man. The real weapon of the Bolshevik is starvation. The Bolshevik succeeds where prices are high, where there is discontent in the Army, and it is my conviction that this Estimate and this Bill is the strongest ally which Bolshevism has had for a long time in this country.
Does the right hon. Gentleman not think it will lead to discontent in the Army, that men who are in the Army will think it is too much to be deprived of the chance of taking part in the election of this Parliament which was elected behind their backs, and that this Parliament has passed an Act to keep them abroad when they all want to come home? I do not think that that is the way to spread content in the Army, although the right hon. Gentleman has improved, and very rightly, the material conditions of the Army, but it is this sort of expenditure—£600,000,000—which is keeping up prices,
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and it is the keeping up of prices which is really the cause of discontent at home. While you keep a million men unnecessarily abroad in the Army you reduce the production of the country, and it is upon high production in the country that industrial contentment rests. You are not only keeping a million men in the Army, as they think unnecessarily, but you are also going to send them back at the end of their time with a reduced capacity for production. I do not think that anyone who has had experience of the Army, and of the way things are done in the Army, will deny that. Therefore, I say that so far from this Estimate and this Bill being a bulwark against Bolshevism it is a support and an incitement towards Bolshevism. The great inducement that was held out at the beginning of the War was that it was a War to end War, and that its great aim was to bring us into an era of peace, and already the right hon. Gentleman by this Bill and by resisting this Amendment is inviting us to take a step, as I think an irretraceable step, in the direction of irretrievable and irremovable militarism in this country.
6.0 P.M.
Mr. MACQUISTEN: I am one of those Members who object very strongly to military expenditure. The smaller Army we have I think the better, because it is utterly unproductive and unfruitful expenditure in the ordinary way. But I have no sympathy with the views that have been expressed, because I think that the right hon. Member for Peebles and the right hon. Gentleman are all fighting their shadows. There is no real difference between a conscript Army and a voluntary Army. None whatever. You have no such thing as a voluntary Army unless a man is able to lay down his rifle whenever he likes and say, "I have had enough of this job," and go home. To me the man in the Army who volunteered and who wants to chuck the job is just as much a conscript as the man brought in under the Military Service Acts. I have never been able to see any difference between the two of them except this, that possibly the man who volunteers may be a man of more emotional nature who has been swayed by his desire to do patriotic things, whereas the other fellow, who is more thick-skinned, has not been affected by the advertisements which the first Government that was in power when the War started scattered all over the country. So that it might be said that it was a better class

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of men who had volunteered, and if I had my way, after they had volunteered, I would have said, "You fellows volunteered to go, but you will not be sent, and we will take all the fellows who have not volunteered and we will send them first." There is no difference at all. What I do hope is this—that the estimates are not too large. I think the Government have missed a great opportunity, because the right way to get up an Army for this country would be to resurrect the old militia ballot, so that everybody would have a chance of serving whether willing or not. I think the system of taking volunteers is most unfair. You might as well have the voluntary principle applied to taxation. It is the duty of every man to fight for his country if his country's condition requires it. It is very absurd and unfair to see cases where some families have had all their sons go voluntarily while others have managed to get into sheltered occupations at home. It is amongst those who did not serve and who did not volunteer, and who got exemption, that the spirit of industrial unrest and revolutionary principles prevails, and the reason for that is that they have got bad consciences, and they are pretending now that everything in the country is all wrong, and that is why they did not fight for it. There is no Bolshevism among the volunteers. I would suggest that we should take those who have got exemption, and let us take the friends of hon. Members opposite to do their turn, and let us take all the Members of Parliament who were exempted in the last Parliament, and after an experience of the Army, perhaps they will not be quite so sore. A voluntary Army and a conscript Army are exactly the same in effect, since a man cannot get out when he wants to get out. There is no essential difference at all. Supposing you had said that men who were working at particular jobs would have to stay at those jobs, that would have been industrial Conscription. I think this argument about voluntaryism and Conscription is merely fighting a shadow. I maintain there is no difference between the two methods of service, and the method of taking a fair quota, as small as possible and none at all if we could do without an Army, is fair and equitable in every way, and is applied without injustice or unfairness.
Mr. JOHN JONES:I happen to belong to an organisation of which I have been a member ever since I was a lad and which
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advocates the principle of National Service for internal defence—that is to say, if a country is worth living in it is worth fighting for. In so far as I am concerned I have no objection whatever to the principle of National Service being recognised as part and parcel of the policy of the nation. When I heard my hon. and learned Friend opposite dilating upon the advantage of voluntaryism or Conscription and comparing them with each other, I wondered why he made gibes at us who sit here. He evidently appears to be a Gentleman of military age.
Mr. MACQUISTEN: No; I am not.
Mr. J. JONES: There were plenty of men older than you who went, and if you were so anxious to defend your country there were no obstacles which stood in your way.
Mr. MACQUISTEN: I was certified as unfit.
Mr. JONES: But not mentally. There were a lot of gentlemen at the War Office who could have well vacated their position for the purpose of allowing you to try and serve your country. I approach this subject from the standpoint of not desiring to put obstacles in the way of national defence, but I want to know where national defence begins and where it ends. In Egypt why are we to-day involved in trouble? The hon. Gentleman who spoke just now (Captain W. Benn) has given you an expression of opinion which is not merely his individual expression of opinion. Some of us have had sufficient correspondence from friends of ours who are serving in the Egyptian Forces to see that one of the consequences of the military maladministration that has taken place in Egypt has been the breaking out of unrest among the people in Egypt. The same thing could be extended. Did men join the Army, and did I go on recruiting platforms and advocate that this nation was in danger, because of the possibility of Prussianism being forced on it; and did I go out to fight against Prussianism in Berlin in order to see it re-established in Downing Street? Are we going to accept the policy that has been laid down here this evening because certain gentlemen in Paris, and certain people in Berlin, and certain people in other countries, that may be involved in this matter, cannot come to terms and cannot fix up arrangements on the lines laid down, and have we therefore got to have Conscription more

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or less permanently imposed on the people of Great Britain? We in the Labour movement have been divided; some of us have been pro-war men and some antiwar men, but none of us have ever agreed we were going into this War merely for the purpose of having a kind of suspended Military Service Act continually held over our heads. In so far as we are concerned, therefore, what are the propositions contained in the Bill? It simply means, so far as the people of this country are concerned, that they have to commit themselves to any military operations that may be involved in the future arrangements of peace. We want to see peace first and military arrangements afterwards, and now it seems to me to be the military arrangements first and peace a long way afterwards.
What is the consequence of our position? Our men, without being consulted on the matter, thousands and thousands of our citizens, are now kept compulsorily in the Army twelve months longer than they expected, and they are going to be kept longer still if the proposals contained in this Bill are carried into operation. Whilst we are willing to see that this old country of ours shall never see the foot of an invader, and whilst we are ready to take any necessary steps which may be involved in its protection, we want to suggest that it is not good business for us to be now asked to agree to a Bill which may mean the perpetuation of the principle against which we have been fighting, and for which so many of our men have sacrificed their lives. What right have you to suggest that you want an Army to interfere in the internal affairs of other countries? On what grounds are Members of this House going before their constituents to say, "We defended Belgium against outward attack"? Does that mean that we are going to imitate the Germans, and that we are going to claim the right to interfere with the independence and rights of people of other nationalities? If it does, then we have reversed all the objects for which we have been supposed to have engaged in the War. I do not believe in the ordinary cry of voluntary service, because hunger used to be the recruiting sergeant at a shilling a day. I want to see this country so prosperous from the standard of its common rights that the man who lives in the country will be proud to fight for it if called upon to do so. That does not mean that British soldiers must become rent col-
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lectors. That does not mean that we have got to go to Egypt and to Russia to collect dividends on the bonds of people who have invested their money there. If they want their money, let them go out and collect it themselves. Unfortunately, today we are not being governed by the Government; there is a force behind the Government and there is an influence to-day which is fixing us up in all sorts of international obligations apart from the democratic instincts of the people of this country. As a consequence, now, the British soldier is going to be retained in the Army by compulsory means in order that he may become a collector of other people's debts, and the hook-nosed patriots who sing "God Save the King!" will be the only people who will gain as a result of it. I have heard references to Mesopotamia—that happy land. Some of our men are anxious to get away from it. I saw a letter from one of the boys out there, which said, "Dear Mother, I am now in the land where the Lord was born in, and I wish to the Lord I was in the land where I was born in!" In order that these men may remain as the sentinels for capitalism in the outposts of Empire, in Russia and in other countries, and to collect other people's debts, we are told our men have got to fight on in order that the guaranteed interests may be found for those who invested capital. I say honestly, Gentlemen, patriotic Labour man as I have been—[HON. MEMBERS: "Order, order!"] I am sorry if I have made a mistake in calling you "Gentlemen." Mr. Speaker, right hon., and hon. Members, I want you to realise that the workers of this country thought when they won this War that they had finished with Conscription. They did not believe that it was a post-dated cheque on the bank of futurity for which they fought. They believed that we were out to win a victory for democracy, and, whether our Friends opposite like it or not, militarism is the very antithesis of democracy, and we democrats are out to fight all the time and every time against militarism. [An HON. MEMBER: "We are all against it!"] Then show that by going in the Division Lobby with us and voting against it. We are opposed to militarism all the time. We have backed the Government and the War because we believed it was necessary to kill German militarism. You have already got the means to provide an army for the purpose of peace and for the interregnum between the cessation of hostilities

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and the Declaration of Peace, because you have power to maintain men in the Army under certain age-limits. On top of this we are now practically declaring to the whole world that what we went out for in the War and the declarations which our Prime Minister made were simply camouflage and just as bad as German militarism, and that we are prepared to follow that horrible example and to continue this cursed system which has been an eyesore on democracy and an outrage on humanity ever since it was first formulated in the world. I want to associate myself with the Opposition, although I took as active a part as I could in helping to secure the prosecution of the War to a successful conclusion. We say that the best evidence we can give of our desire for peace and the best intimation of our hope that we want to see a proper League of Nations is to tell the Government of our country that we want this hell's dance to stop, and that the workers in all countries understood, in fighting for democracy, they meant democracy and did not mean handing the people over to be sacrificed on the altar of militarism.
Colonel GREIG: We have listened to somewhat impassioned speeches from the other side. The hon. Gentleman who has just spoken said that during the War he took part in recruiting and assisted the Government to raise the Army with which we have nearly completed the War. He now turns round, vitiated I am afraid by the example set by the Front Bench opposite, into doing, what? Throwing away the chance of what we all pledged ourselves to do, and whether we pledged ourselves with regard to Conscription or not I will deal with later, but we all pledged ourselves to this, that this War should eventuate in a safe peace for mankind and democracy. What was the main enemy we were all up against at the election coming from the hon. Member's own party and from Members with whom probably he did not agree, but whom we have seen in this House. It was this. These were the men who said from the first, "You are wrong in going into this War; you were not right in taking your stand by Belgium and France." That was an attitude which was consistently adopted by other Members in other parts of the House. That was what we were up against in the country. When we went there, we had to show our people that if the election had resulted in the return of
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these men to Parliament we should have been up against the same sort of difficulty. I regret to see something of the same spirit exhibited now.
I cannot for one moment believe that there is in the mind of any man on this side of the House or in the mind of any member of the Government the idea that compulsory military service shall become a permanent system in this country. I myself have given years of my life to the service of a voluntary system. Right up to the middle of the War I was in favour of it. Why was it we had to alter our opinions? Because we found that voluntary service did not impose a fair burden on all the people of the country, and that in the middle of the War it was found necessary that everyone should be subject to service, if it was necessary. It went against our grain then and it goes against our grain to maintain that system. If you give it up at the present moment, or until you have secured peace, you will risk everything for which the sacrifices were made. If we could see the men who were sent to the Front and who have given up their lives, they, I am sure, would be the first to say, "Let our fellows, even at the expense of a little hardship, bear a little longer the burden that we bore for the sake of the safety of the country." I regret to hear right hon. Gentlemen on the Front Opposition Bench say that this is an attempt by the Government to fix a permanent military service upon the country. I am quite prepared to say that if there were any attempt on the part of the Government to do that I, and I am sure numbers of other hon. Members around me, would vote against it. We believe that we have got to get the War finished safely. We are going to take no chances whatever.
If the advice of right hon. Gentlemen opposite were followed, we should immediately start a recruiting campaign throughout the country to get an Army together. Then we should have to train the men. Those of us who had to train them before had some doubt whether they could be trained in the three or four months at our disposal. Hon. Gentlemen opposite would risk everythng at the present moment rather than have us tell our constituents that on the whole this is the best thing to do. What did we say to our constituents? I was pressed on the question right and left, "Are you in favour of compulsory military service in the future?" I said, "No; but we have

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got to finish this War. The Military Service Acts will naturally terminate, but at the same time your League of Nations must have a sufficient military force behind it to impose its sanction." If I had said nothing, even if I had pledged myself to put an end to the Military Service Acts now, I would take the risk of going back to my Constituents and telling them that in the present circumstances, in the outlook we have over the world at the present time, we should be false to our duty to our constituents to refuse to take the steps which the Government now ask us to take. I am sorry the Opposition are taking this course, but, after all, it is only an attempt to get a stick with which to beat the Government. [HON. MEMBERS: "NO!"] It was with some regret that I heard the speech of the hon. and gallant Member for Leith (Captain W. Benn). We all know what he has done in the War and the bravery and courage he has displayed. It is a little regrettable to see that the virus of political animosity still works in him. This Amendment, which was supported by right hon. Gentlemen opposite, came from a little lower down the bench, from an hon. Member who has been against Conscription from the very first. What would have happened if his advice, and the advice of those with whom he consorted, had been followed? We should have lost the War. I am not prepared to take that risk, and even at the risk of getting letters from my Constituents—I have had none—I am going to vote for the Bill. The French and the Americans are going on with the burden on their shoulders too. It is our duty to stand by them to the end. If the Government attempt to impose permanent compulsory military service on the country I shall vote against them, but I am going to support this Bill in order to secure a safe, conclusive, and decisive peace for the world.
Mr. HOLMES: The hon. Member for the Springburn Division of Glasgow (Mr. Macquisten) devoted his speech to trying to prove to us that there was no difference between a conscript Army and a voluntary Army. He reminded me of the old riddle, "Why does a married man live longer than a single man?" the answer being, "He doesn't; it only seems longer." The hon. Member surely knows that, at any rate in the opinion of the people of the country, there is a great difference between the voluntary Army and the conscript
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Army. He will find it out more and more as he goes to Glasgow and comes back. With regard to the speech of the Secretary of State for War, as one sits here and watches various Members defending or advocating the measures put forward by the Departments, one cannot help feeling that some of them, at any rate, are not very happy in their positions, and that the work they have been given by the Prime Minister is not entirely to their liking. But it is not so with the right hon. Gentleman the Secretary of State for War. I believe he has never had a task more agreeable to him since the time he escaped from Pretoria. I can imagine him sitting in his room at the War Office, using the telephone, and thoroughly enjoying moving a brigade to the Murman Coast or sending the Sherwood Foresters to Cologne, or even the Guards to Dundee. I can imagine him, with a map in front of him, thinking he is monarch of our forces from Whitehall to Wurtemburg, or from Sidney Street to Salonika. He takes a thorough joy in all his work at the War Office. It is to him disappointing that he should have to come down and defend a measure like this with arguments which are unworthy of him. He tried to convince the House to-day that this measure was necessary because of the outbreak of Bolshevism in Hungary. He omitted to point out to the House that the present Military Service Acts are going on to the end of the War and until the ratification of peace, and that if Hungary is in a state of Bolshevism there will be no ratification of the terms of peace. Therefore the present Military Service Acts will continue, and there is no need for him to ask for this Bill, which is to extend military service after peace is ratified, giving as a reason the state of Hungary at the present time. The same equally applies to what is apparently, according to the Undersecretary of State for Foreign Affairs, a temporary thing in Egypt. That is a bad argument to put forward in favour of a Bill which is to come into operation only after peace is ratified.
The right hon. Gentleman told us on the Second Reading that the object of this Bill was to secure the fruits of victory. The hon. and gallant Gentleman who has just sat down has spoken in the same sense. None of us want to lose the fruits of victory, but we believe that the fruits of victory, after peace has been ratified and after all the enemy nations have agreed to our terms, can be secured by the

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voluntary system. The right hon. Gentleman said that he had a scheme for voluntary enlistment; that he had done his best in regard to it, but that it had failed. What was his scheme? It was a scheme for two, three, or four years' service. A man joining under that scheme would think he is joining as a Regular soldier. If the right hon. Gentleman had said, "Are you prepared to join until the 30th April of next year for the purpose of securing the fruits of victory, and so that they should not be lost to the nation?" I have not the slightest doubt that he would have secured the services of all the men he required. That is the proper comparison to make between voluntary service for this purpose and his continuation of the Conscription Act. He will find, as time goes on, although it may not be an opposition organised like the opposition to the Ways and Communications Bill, that there is a deep-felt resentment throughout the country against this continuation of compulsory military service. People feel that they have been taken in. They believed when they saw the posters
"Vote for Lloyd George and no Conscription"
that it meant that the present Military Service Acts would not be continued and they do not understand why this Bill for continuing compulsory military service after the War is being brought in, having regard to those pledges, which were taken up by all hon. Members who support the Government and advocated by them. Hon. Members opposite may not have received many letters, but if they had gone down to their constituencies since and had spoken with regard to their votes on this particular matter, they would have found already that this resentment exists and will continue to exist in the country. [HON. MEMBERS: "NO!"]
Captain STANLEY WILSON: Why should you say that?
Mr. HOLMES: Perhaps the hon. and gallant Gentleman has not been down to his constituents.
Captain WILSON: Yes I have, during the last few days.
Mr. HOLMES: The constituency of the hon. and gallant Member probably knows him very well by this time.
Captain WILSON: There were no complaints.
Mr. HOLMES: I assure hon. Members that they will find there will be continued
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resentment in the country so long as the compulsory Military Service Acts remain on the Statute Book.
Mr. C. WHITE: It is perfectly easy for the Secretary of State for War to make out a good case for his supporters, but I should like him to remember that all the brains and wisdom of the country are not concentrated in the House of Commons, and that some of us have some experience—I would venture to say even greater experience than he has had during the past few weeks—of what is the feeling of the country with regard to this measure. He was speaking the other day in somewhat slighting terms of dissentient Liberals. I happen to be one of them, who dissents from the Toryism which is now practised by the right hon. Gentleman. I hold in my hand a telegram of which I have been proud up till now. It was sent to me in 1910:
"All good wishes for you in your contest for Free Trade and free government.
(Signed) WINSTON CHURCHILL."
I see a free Government returned on pledges broken at the very first opportunity in regard to Conscription in this country. I want to say this—I say it with some knowledge of the circumstances, especially of the homes that are going to be made fit for heroes to live in, and the homes from which the heroes have come—that a peace which requires a conscript Army is not the peace for which we fought. Europe with a League of Nations, it seems to me, is to be an armed camp. Armed against whom? Austria is out, Turkey is out, Bulgaria is out, Germany is out. We are told that the man who won the War was the Prime Minister. Of course, if we have not won the War, these countries are not out, and if they are not out, why on earth did we give up on the 11th November last? We fought, as I thought, for freedom, liberty, mutual good will, and free government. Yet what is the Government we have got, with its automatic majority returned on pledges which I am afraid it was never intended should be kept? I was engaged very largely as a civilian in recruiting and kept my job until it came under civilian control, and then I lost it because I was not a military man. In fact, we got more militarism after recruiting was turned over to civilians than we ever had before. I fought for recruiting under the voluntary system as few men fought for it. In my own county of Derbyshire I addressed 103

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recruiting meetings, and immediately I saw that Conscription was necessary I fought just as hard for it, but always as a temporary measure, and if I thought this was going to be a temporary measure I should not be here to-night. I am here, however, to say it will not be a temporary measure. We shall have the same excuses put forward at the end of 1920 as we have heard to-day.
I explained, in the homes of thousands of men—and I am not exaggerating, although I do not get 5,000 letters a day—but I explained in the homes of thousands of men that this would cease at the end of the War. Last Thursday night I was addressing a large meeting in the North of England with a man who had just come home. He has been out several times. He said to me, "White, there never was such resentment in the Army as there is to-day in regard to this Conscription Bill which is being forced upon us." I am here to say that if eternal peace were guaranteed to-morrow we should still have a good many conscriptionists in the Government returned by these means. If an Army is wanted, one quite large enough could be got by voluntary means. You did not hesitate to raise your million of men for munitions. The right hon. Gentleman told us the other day what the soldier gets, 48s. a week if he is single, and 79s. if married. I have yet failed to find any man who is getting anything like that, even with the separation allowances. Pay your soldier on the same rate as you pay your munition worker, then you will get your Army in no time. Make the conditions of life easier for the men who have done so much for us. Abolish tyranny and bullying on the barrack square. [HON. MEMBERS: "Oh, oh!"] I know what I am talking about. I have given all I have to the Army. I have two brothers lying out there, one was nearly fifty years old when he joined up, and he told a legitimate lie, and said that he was only thirty-nine in order that he might be accepted. Pay the soldier full pay each week. Let him understand he is a citizen of the world instead of what he is.
I heard the right hon. Gentleman say the other day that in endeavouring to raise this New Army he is taking men in at eighteen, and I was sorry to hear him add he was also getting them in at seventeen. It is only introducing that spirit of militarism which we set out to destroy. The boy of eighteen is to be apprenticed,
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so to speak, and after two years' training he is to get full pay as a soldier. I want to remind the right hon. Gentleman that it only took three months to make men fit to fight the German and that was not very long ago. Yet now the soldier is to have two years training before he is entitled to his full pay. One of my relatives was sent out a fortnight after he joined up. Yet now we are told it requires two years to train a man, and to make him eligible for full pay. Military service this year and next year will be largely a matter of policing. I have heard a good deal said about the splendid adventures these men will have and what a beautiful adventurous life it will be for them. I look around the House and I see there are 229 service and ex-service men in it. I wonder to myself how on earth they can be spared when all this important work is to be done across the water. What a lot they are missing in missing this life of adventure which is opening up on the Rhine. What an incentive it would be to recruiting if, although they be fifty years of age, they were all to join the right hon. Gentleman's voluntary army and to go out there and join the boys that have been out there so long. The House of Commons would be quite safe in their absence; the mechanical majority would still exist.
I want to say a word about the effect of this proposal on the country. I am not a Labour man, although I am proud to be associated with hon. Members on these benches. What will be the effect of Conscription in the country? In the Army, as hon. Members must know, and at any rate those who sit on these benches know it, because we get letters from the address-of which "M.P." is purposely omitted so as to make sure that the documents-shall reach us, and we therefore do know something about what is happening out there. The spirit of 1919 is not quite the spirit of 1914. Many men have not been home for three years Many see no chance of coming home, and when they hear that more Conscription is proposed, they reply that they would have preferred to fight through to Berlin rather than now have a further Conscription Bill imposed on them. I want the Government in this time of unrest—and I am one who knows as few men know the cottages of this country—I want the Government in this time of unrest to realise the danger which attaches to this proposal. The soldiers are against it. I heard the right hon. Member for Belfast

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the other night say he believed the country, if it had the matter fully explained to them, would go to unlimited lengths in supporting the Government. But, unfortunately, the right hon. Gentleman forgot that the people had something else explained to them when they gave their vote. They were told there would be no more Conscription in this country. That is what they had explained to them. Then organised Labour is against the proposal. So, too, is unorganised Labour. I represent a constituency in which there are not 500 organised men, and yet there are 30,000 electors, and I can tell the right hon. Gentleman that unorganised Labour is against him. The women of England are against the Government, and, be it remembered, they have now a weapon in their hands, which they were not slow to use the other day, and which they will not be slow to use on Saturday next. The great brotherhood of man, cemented together by the blood they have shed and the sacrifices they have made, are also against the Government. It is their efforts which have made it possible for us to be here considering whether we should pass another Conscription Bill. These men constitute the greatest brotherhood in the country, and they are against the Government.
One has heard Members less than forty years of age say that they will cheerfully go into the Lobby and vote for Conscription. I wonder at the shamelessness of it. And yet that is the statement I have heard made in this House. I want to win the War. But I want to see it won without resorting to further Conscription. This Bill will not be an end of it. The right hon. Gentleman will find some strong assistance from the placards of London about next April. There will be another scare worked up, such as we have had in the past, and the people responsible for it will dictate to the Government what they shall do, and the Government will have to follow their advice. Let us have a peace built up on the good will of the nations of the world. As I sat here this afternoon I thought of those words of Tennyson in "Lockesley Hall"—
"For I dipt into the future, far as human eye could see,
Saw the Vision of the World and all the wonder that would be.
Till the war drum throbb'd no longer and the battle flags were furl'd
In the Parliament of man, the Federation of the World."
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Let us all do our utmost to bring that about and make a happier and brighter land than we have at present.
Captain GUEST (Joint Parliamentary Secretary to the Treasury): Possibly the House feels the time has arrived when one can usefully get back to the actual Amendment before it, and perhaps, too, it may reasonably be deemed time for us to come to a decision upon it. I would like, however, to say a word as to the general lines the Debate has taken. I do not think that in the end it will prove unhelpful to the Government. The Government are faced with practical necessity and practical responsibility, and they have to look at the immediate situation in front of them. I have carefully listened to the several speeches delivered by opponents of the Bill, and I have failed to find any indication of an alternative policy of a practical character. There are no doubt opinions which find a home in many minds—the opinion, for instance, that more might have been done on the voluntary basis. But the fact remains that we have not got enough men from our voluntary efforts to satisfy the immediate demands of this country in order to safeguard the return of the troops which we all desire, and to do anything short of what is proposed in this temporary measure would mean that we should run the risk, at any rate of making the sacrifices which we have already made, sacrifices in vain. The arguments which were put forward by my right hon. Friend on the Second Reading appear to have been entirely neglected. On that occasion the Secretary for War told the House specifically that unless some such measure as this was passed the Army would automatically "fly to bits." One hon. Member opposite has told us that he is quite prepared to face the risk that our coaling stations might be left undefended. But the Government is responsible to this country, through its selected representatives, and we are all going to see that no such risks are incurred. Therefore, I submit the House would do well, as I hope it will, to give this measure confident support.
There were a few points mentioned by hon. Members which it is perhaps right I should touch upon briefly. There was one point raised on the Front Bench opposite by an hon. Member who made, as I thought, a very unfair attack on the Government. Whatever may be the opinion he holds there can be no doubt

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that the position in Egypt has to be faced, and it can only be faced with a sufficiently large Army of white troops in order to tranquilise that country and save the lives of many of those who are in jeopardy there to-day. This is a condition of affairs with which the Government is actually faced, and surely in a world so full of turmoil it is not unreasonable to put on the other side the suggestion of insurance. Insurance in the long run is very often the cheapest investment. The Amendment as it stands will have the effect of, as my right hon. Friend said, eliminating from the Bill any competent authority, and the other Amendments which are consequent upon it, go further, so that practically there would be no tribunal to decide on these peculiar conditions. And that I can hardly think even the supporters of the Amendment would really desire. I hope the House will arrive at a conclusion now upon this Amendment and enable us to get on with the other Amendments which raise other questions in which the House is deeply interested—more deeply perhaps than in the one now under discussion.
Mr. HOGGE: I am glad my hon. and gallant Friend who has just sat down wanted to get back to the practical issue of this Amendment, and I wish to put it to him in a different way, because neither he nor my right hon. Friend the Secretary of State for War has yet addressed his mind to it, or given an adequate reply to it in the House. We have maintained, and we still maintain, that no steps have been taken at all to secure the men on a voluntary basis for a period of one year. The reply to that given by the Secretary of State for War is that there is no truth in that argument used by my right hon. Friend, because the Government had made an effort by offering a bounty to men who would enlist for two years, for three years and for four years, and they had found that bounty to be of no value in producing the men, and it was not until they altered the conditions that men began to flow in. What was the very first condition that procured the flow of men? It was the doubling of the present rate of Army pay. The moment you doubled the rate of pay and offered that to the men for the first year, my right hon. Friend himself admits that he at once began to get 1,000 per day. My simple question to him is this: Why did he, and the Government he represents, not make this perfectly simple offer to the
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men who are serving in the Army now, namely, that for the period of one year up to 30th April, 1920, they would serve on the basis of the increased rates of pay, with the continuance of all the other accessories, such as separation allowance, civil liabilities, and so forth, plus the bounty which they offered before for two, three and four years' service on demobilisation? My right hon. Friend has never done that, and never tried to do it. He has tried a lot of things since the Committee sat. He told us this afternoon he had passed advertisements to go into the great newspapers costing thousands of pounds, calling for voluntary recruits. That may have occurred to him before, but it has not been done.
Mr. CHURCHILL: It has.
Mr. HOGGE: He said he has passed the advertisement, but it has not appeared.
Mr. CHURCHILL: I said I had passed an advertisement—one of a series, but not by any means the first.
Mr. HOGGE: I have seen all that have appeared, and so far the only advertisement that has appeared in the newspapers is one which gave the terms of pay to the men on the Rhine, go that if he has passed more than one the right hon. Gentleman had better get someone on the track to ascertain where the others have gone. The fact is, attempts have not been made. Has my right hon. Friend or the War Office at any time made the attempt to secure the men for the period of one year? The answer to that is "No; it has not been done." The Amendment of my right hon. Friend does not seek to destroy this Bill. What my right hon. Friend proposes to do by his Amendment is to give power to the Government for the purpose of getting these men to reap the fruits of victory, if by a specified time they do not get recruits for it. Some hon. Members seem to think we want to deprive this country of the fruits of victory. That would be a most idiotic position for anybody to take up. No one in this country would seek for a moment to jeopardise the position in which the State finds itself. If events turn out, as they may turn out, to be different from what we contemplate, at the present moment you have in existence the Military Service Acts, which enable you to keep this Army, and not only to keep this Army, but to re-embody over a million men who have been demobilised, every one of whom is a fit fighting

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man, and who can, at any moment of danger, be again put into the firing line or otherwise used in the Army. They are there by your Military Service Acts, and all my right hon. Friend has to do, if he finds as months go by that he requires physical force, is to re-embody these men. There is an Amendment on the Paper later dealing with that particular point, because hon. Members must remember that, in spite of the Bill, and in spite of what has been said, everyone of these million men can be re-embodied in the Army.
That is the point briefly. There are other points one might put. My right hon. Friend made, in some respects, really a Second Reading speech in referring to Egypt and questions of that kind. We might pursue that very usefully, but that is not the purpose of this Amendment. The purpose of this Amendment is, before we go into the Division Lobby, to get from the Government, if we can, a pledge that, before they put this Bill into operation as an Act, and
maroon those young men on the Rhine in the Army of Occupation, they will make a genuine attempt to get them on a voluntary basis. We believe it can be done. We want to keep the pledges the Government and we have made to the country with regard to Conscription, and if the Government will not give us a guarantee on this, at any rate we will have the satisfaction once again of putting on record the fact that, while we mean to keep faith with those who sent us here, the Government, which came back to this House maintaining that Conscription was going to be finished, and who advertised that fact to the soldiers whom they are now conscripting so as to get their votes, are again breaking their bargain.
Question put, "That the words proposed to be left out stand part of the Bill."
The House divided: Ayes, 283; Noes, 71.

Division No. 17.]

AYES.

6.54 p.m.

Adair, Rear-Admiral

Cecil, Rt. Hon. Evelyn (Aston Manor)

Foreman, H.

Agg-Gardner, Sir James Tynte

Cecil, Rt. Hon. Lord H. (Oxford Univ.)

Forestier-Walker, L.

Ainsworth, Captain C.

Chamberlain, Rt. Hon. J. A. (Birm., W.)

Foxcroft, Captain C.

Archdale, Edward M.

Cheyne, Sir William Watson

Fraser, Major Sir Keith

Astbury, Lt.-Com. F. W.

Child, Brig.-Gen. Sir Hill

Gange, E. S.

Austin, Sir H.

Churchill, Rt. Hon. Winston S.

Gardiner, J. (Perth)

Bagley, Captain E. A.

Clay, Capt. H. H. Spender

Gardner, E. (Berks., Windsor)

Baldwin, Stanley

Clough, R.

Gibbs, Colonel George Abraham

Balfour, George (Hampstead)

Coates, Major Sir Edward F.

Gilbert, James Daniel

Banbury, Rt. Hon. Sir F. G.

Coats, Sir Stuart

Gilmour, Lt.-Col. John

Banner, Sir J. S. Harmood-

Cobb, Sir Cyril

Glyn, Major R.

Barnston, Major Harry

Cockerill, Brig.-Gen. G. K.

Gould, J. C.

Barrie, C. C.

Cohen, Major J. B. B.

Grant, James Augustus

Beauchamp, Sir Edward

Colvin, Brig.-Gen. R. B.

Green, J. F. (Leicester)

Back, Arthur Cecil

Compton-Rickett, Rt. Hon. Sir J.

Greene, Lt-Col. W. (Hackney, N.)

Beckett, Hon. Gervase

Conway, Sir W. Martin

Greer, Harry

Bell, Lieut.-Col. W. C. H. (Devizes)

Cope, Major W. (Glamorgan)

Greig, Col. James William

Bellairs, Com. Carlyon W.

Cory, J. H. (Cardiff)

Gretton, Col. John

Bonn, Sir Arthur S. (Plymouth)

Courthope, Major George Loyd

Guest, Capt. Hon. F. E. (Dorset, E.)

Benn, Com. Ian Hamilton (G'nwich)

Cowan, Sir W. (Aberdeen and Kinc.)

Guest, Major O. (Leices., Loughb'ro'.)

Bennett, T. J.

Cozens-Hardy, Hon. W. H.

Guinness, Capt. Hon. R. (Southend)

Bigland, Alfred

Craig, Capt. C. (Antrim)

Guinness, Lt.-Col. Hon. W. E. (B. St. E.)

Bird, Alfred

Craig, Col. Sir James (Down, Mid.)

Hacking, Captain D. H.

Blair, Major Reginald

Croft, Brig.-Gen. Henry Page

Hailwood, A.

Blake, Sir Francis Douglas

Curzon, Commander Viscount

Hall, Admiral

Blane, T. A.

Davidson, Major-General J. H.

Hall, Lieut.-Col. Sir Fred (Dulwich)

Borwick, Major G. O.

Davies, Sir Joseph (Crewe)

Hambro, Angus Valdemar

Boscawen, Sir Arthur Griffith-

Davies, T. (Cirencester)

Hamilton, Major C. G. C. (Altrincham)

Boyd-Carpenter, Major A.

Davison, Sir W. H. (Kensington)

Hanson, Sir diaries

Brackenbury, Col. H. L.

Dean, Com. P. T.,

Harris, Sir H. P. (Paddington, S.)

Brassey, H. L. C.

De-whurst, Lieut-Corn. H.

Henderson, Major V. L.

Bridgeman, William Clive

Dixon, Captain H.

Hennessy, Major G.

Briggs, Harold

Dockrell, Sir M.

Herbert, Col. Hon. A. (Yeovil)

Brittain, Sir Harry E.

Donald, T.

Herbert, Dennis (Hertford)

Broad, Thomas Tucker

Doyle, N. Grattan

Hickman, Brig.-Gen. Thomas E.

Brown, Captain D. C. (Hexham)

Duncannon, Viscount

Hilder, Lieut.-Col. F

Buchanan, Lieut.-Col. A. L. H.

Edgar, Clifford

Hoare, Lt.-Col. Sir Samuel J. G.

Buckley, Lt.-Col. A.

Edwards, A. Clement (East Ham, S.)

Hood, Joseph

Bull, Rt. Hon. Sir William James

Elliot, Capt. W. E. (Lanark)

Hope, Harry (Stirling)

Burdon, Col. Rowland

Eyres-Monsell, Com.

Hope, James Fitzalan (Sheffield)

Burn, T. H. (Belfast)

Falcon, Captain M.

Hope, Lt.-Col. Sir J. (Midlothian)

Butcher, Sir J. G.

Falle, Major Sir Bertram Godfray

Hopkins, J. W. W

Campbell, J. G. D.

Farquharson, Major A. C.

Home, Edgar (Guildford)

Carew, Charles R. S. (Tiverton)

Fell, Sir Arthur

Hume-Williams, Sir Wm. Ellis

Carr, W. T.

Fisher, Rt. Hon. Herbert A. L.

Hunter, Gen. Sir A. (Lancaster)

Cautley, Henry Strother

FitzRoy, Capt. Hon. Edward A.

Hurd, P. A.

Hurst, Major G. B.,

Morrison, H. (Salisbury)

Stanley, Rt. Hon. Sir A. (Ashton)

Inskip, T. W. H.

Morrison-Bell, Major A. C.

Stanley, Col. Hon. G. F. (Preston)

Jackson, Lieut.-Col. Hon. F. S. (York)

Mosley, Oswald

Stanton, Charles Butt

Jephcott, A. R.

Mount, William Arthur

Steel, Major S. Strang

Jesson, C.

Munro, Rt. Hon. Robert

Stephenson, Col. H. K.

Jodrell, N. P.

Murchison, C. K.

Stevens, Marshall

Johnson, L. S.

Murray, John (Leeds, W.)

Stewart, Gershom

Johnstone, J.

Neal, Arthur

Stoker Robert Burdon

Jones, Sir Edgar R. (Merthyr Tydvil)

Nelson, R. F. W. R.

Strauss, Edward Anthony

Jones, G. W. H. (Stoke Newington)

Newman, Major J. (Finchley, Mddx.)

Sugden, Lieut. W. H.

Jones, J. Towyn (Carmarthen)

Newman, Sir R..H. S. D. (Exeter)

Surtees, Brig.-Gen. H. C.

Jones, Wm. Kennedy (Hornsey)

Nicholson, R. (Doncaster)

Talbot, G. A. (Hemel Hempstead)

Kerr-Smiley, Major P.

Nicholson, W. (Petersfield)

Taylor, J. (Dumbarton)

Kidd, James

Nield, Sir Herbert

Terrell, G. (Chippenham, Wilts.)

King, Com. Douglas

Norman, Major Rt. Hon. Sir Henry

Thomas-Stanford, Charles

Knights, Capt. H.

O'Neill, Capt. Hon. Robert W. H.

Thomson, F. C. (Aberdeen, S.)

Lane-Fox, Major G. R.

Ormsby-Gore, Hon. William

Townley, Maximillian G.

Law, A. J. (Rochdale)

Parker, James

Tryon, Major George Clement

Law, Rt. Hon. A. Bonar (Glasgow)

Pearce, Sir William

Waddington, R.

Lewis, Rt. Hon. J. H. (Univ. Wales)

Perkins, Walter Frank

Walker, Col. William Hall

Lister, Sir R. Ashton

Perring, William George

Walton, J. (York, Don Valley)

Lloyd, George Butler

Pinkham, Lieut.-Col. Charles

Ward-Jackson, Major C. L.

Locker-Lampson G. (Wood Green)

Pownall, Lt.-Col. Assheton

Ward, Col. L. (Kingston-upon-Hull)

Locker-Lampson, Com. O. (Hunt'don)

Pratt, John William

Wardle, George J.

Lorden, John William

Pulley, Charles Thornton

Watson, Captain John Bertrand

Lort-Williams, J.

Rankin, Capt. James S.

Weston, Col. John W.

Loseby, Captain C. E.

Raw, Lt.-Col. Dr. N.

Wheler, Col. Granville C. H.

Lowe, Sir F. W.

Rawlinson, John Frederick Peel

Wlite, Col. G. D. (Southport)

Lowther, Major C. (Cumberland, N.)

Reid, D. D.

Whitla, Sir William

Lowther, Col. C. (Lonsdale, Lanes.)

Renwick, G.

Wild, Sir Ernest Edward

Lyle, C. E. Leonard (Stratford)

Richardson, Albion (Peckham)

Williams, Lt.-Com. C. (Tavistock)

Lyle-Samuel, A. (Eye, E. Suffolk)

Richardson, Alex. (Gravesend)

Williams, Col. Sir R. (Dorset, W.)

Lyon, L.

Roberts, Sir S. (Sheffield, Ecclesall)

Williamson, Rt. Hon. Sir Archibald

M'Donald, D. H. (Bothwell, Lanark)

Robinson, S. (Brecon and Radner)

Willougby, Lt.-Col. Hon. Claud

M'Guffin, Samuel

Robinson, T. (Stretford, Lancs.)

Wills, Lt.-Col. Sir Gilbert Alan H.

Macmaster, Donald

Rodger, A. K.

Wilson, Capt. A. Stanley (Hold'ness)

Macnamara, Rt. Hon. Dr. T. J.

Roundell, Lt.-Col. R. F.

Wilson, Col. Leslie (Reading)

Macquisten, F. A.

Royds, Lt.-Col. Edmund

Wilson-Fox, Henry

Manville, Edward

Rutherford, Sir W. W. (Edge Hill)

Winterton, Major Earl

Marriott, John Arthur R.

Samuel, S. (Wandsworth, Putney)

Wood, Major Hon. E. (Ripon)

Mason, Robert

Samuels, Rt. Hon. A W. (Dublin Univ.)

Wood, Sir J. (Stalybridge and Hyde)

Middlebrook, Sir William

Scott, Leslie (Liverpool, Exchange)

Woolcock, W. J. U.

Mildmay, Col. Rt. Hon. Francis B.

Scott, Sir S. (Marylebone)

Worsfold, T. Cato

Mitchell, William Lane-

Seager, Sir William

Yate, Col. Charles Edward

Moles, Thomas

Shaw, Capt. W. T. (Foriar)

Young, William (Perth and Kinross)

Molson, Major John Elsdale

Shortt, Rt. Hon. E.

Moore, Maj.-Gen. Sir Newton J.

Simm, Col. M. T.

TELLERS FOR THE AYES.—Lord Edmund Talbot and Mr. Dudley Ward.

Moore-Brabazon, Lt.-Col. J. C. T.

Smith, Harold (Warrington)

Moreing, Captain Algernon H.

Sprot, Col. Sir Alexander

Morris, Richard

NOES.

Acland, Rt. Hon. Francis Dyke

Hayward, Major Evan

Royce, William Stapleton

Adamson, Rt. Hon. William

Hinds, John

Sexton, James

Arnold, Sydney

Hirst, G. H.

Shaw, Tom (Preston)

Bell, James (Ormsklrk)

Hogge, J. M.

Short, A. (Wednesbury)

Benn, Capt. W. (Leith)

Holmes, J. S.

Sitch, C. H.

Bowerman, Rt. Hon. C. W.

Irving, Dan

Smith, Capt. A. (Nelson and Colne)

Brace, Rt. Hon. William

Jones, Henry Haydn (Merioneth)

Smith, W. (Wellingborough)

Bramsdon, Sir T.

Jones, J. (Silvertown)

Spoor, B. G.

Breese, Major C. E.

Kiley, James Daniel

Swan, J. E. C.

Briant, F.

Lunn, William

Taylor, J. W. (Chester-le-Street)

Cairns, John

Macdonald, Rt. Hon. J. M. (Stirling)

Thomas, Brig-Gen. Sir O. (Anglesey)

Carter, W. (Mansfield)

Maclean, Rt. Hon. Sir D. (Midlothian)

Thomson, T. (Middlesbrough, W.)

Clynes, Rt Hon. J. R.

M'Lean, Neil (Glasgow, Govan)

Walsh, S. (Ince, Lancs.)

Crooks, Rt. Hon. William

MacVeagh, Jeremiah

Waterson, A. E.

Davies, Alfred (Clitheroe)

Morgan, Major D. Watts

Wedgwood, Col. Josiah C.

Devlin, Joseph

Murray, Dr. D. (Western Isles)

White, Charles F. (Derby, W.)

Edwards, C. (Bedwollty)

Nicholl, Com. Sir Edward

Wignall, James

Edwards, Major J. (Aberavon)

O'Grady, James

Wiikie, Alexander

Galbraith, Samuel

Onions, Alfred

Williams, Col. P. (Middlesbrough)

Glanville, Harold James

Parkinson, John Allen (Wlgan)

Wilson, W. T. (Westhoughton)

Grakam, D. M. (Hamilton)

Raffan, Peter Wilson

Young Robert (Newton, Lanes.)

Graham, W. (Edinburgh)

Redmond, Captain William A.

Grundy, T. to.

Rees, Captain J. Tudor (Barnstaple)

TELLERS FOR THE NOES.—Mr. George Thorne and Mr Griffiths.

Hallas. E.

Richardson, R. (Houghton)

Hayday, A.

Roberts, F. 0. (W. Bromwich)

Mr. HOGGE: I beg to move, after the word "retained," ["man may be retained"] to insert the words
"but not for service in any labour unit."
304
7.0 P.M.
My reason for moving that Amendment is that on the discussion in the House on the Second Reading, and also during discussion upstairs in Committee

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we were left in a very unsatisfactory state of mind with regard to what my right hon. Friend proposed could be done with the men who were retained in the Army of Occupation. While everyone must feel, obviously, that men are required for purposes of fighting, everybody does not see with the same force the necessity of retaining fit men—I mean men who are fit for their particular task outside the Army—in the Army doing what is nothing more nor less than civilian work. For instance, a great many men to-day are engaged at this depot at Slough, about which we have heard so much, doing civilian work there which my right hon. Friend himself has investigated. In both France and in Belgium, where there are civilian populations, you find British soldiers, who are not used for fighting purposes, doing work which could be done equally well if not better in both those countries by the French and Belgium people. In the course of our discussion we raised the question of the duties of a soldier and, if I remember rightly, my right hon. Friend used some words like these. He said:
"The constitutional function of the troop during Labour disputes, for instance, had been well defined."
Of course the House will readily understand that the use of soldiers for purposes such as those of labour units does involve the question whether or not they can be used in Labour disputes, and I am seeking to raise that point on this Amendment, in order to avoid the necessity of returning to it later on, on another Amendment which stands on the Paper, and which probably can be disposed of at the same time as this. My right hon. Friend the Secretary for War said quite clearly that the constitutional function of the troops had been well defined. I venture to submit, as a matter of fact, that that is not so, and I have taken the trouble to find out exactly how that matter arose, so far as the House of Commons is concerned and the War Office. I believe there was a Commission, so far back as 1893, after the Featherstone riots—most of us will be able to recollect that that was an industrial affray. A Special Commission was set up, to report on the constitutional function of the soldier, and it contained such names as those of the late Lord Justice Bowen, Lord Haldane, and the late Sir Albert Rollit. They came to no decision that was accepted by the War Office or any autho-
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rity, and it still remained in this House, in debate and by question and answer, a subject of great controversy. I think probably some Members will remember that just before the War broke out a Committee of this House was appointed to deal with this subject, and Sir Ellis Griffith was made the Chairman of that Committee. They never held a meeting, because of the fact of the outbreak of the War. So, on the second occasion on which a Committee was set up to try and define the functions of a soldier, the Committee that would have tried to do so never actually met. What we want to make perfectly clear is this, that it is impossible administratively under this Bill for a man who is conscripted to be used either in a labour unit or as a fighting man in an industrial dispute. We know that in France it has been done under two succeeding Prime Ministers, and conscripted soldiers were used to interfere in industrial disputes. As a matter of fact, soldiers were used only recently in our own country, when we were threatened by a strike in the electrical industry here in London, and trains were run by the military. There, of course, is obviously a difficult situation and likely to provoke a conflict which one wants to avoid. In the discussion on the Second Reading my right hon. Friend dealt with this point from time to time, but never in an adequate way. The danger of the fact that it has not been dealt with adequately lies here: as I pointed out in the last Amendment, we have 1,000,000 soldiers demobilised in Class Z, every one of whom can be mobilised at any moment to take part in an industrial dispute or to prevent an industrial dispute. These men are not out of the Army. The Secretary of State for War dealt with that in the course of the Debate. I do not propose to quote at any great length from Hansard, but there are two-and-a-half pages of Question and Answer between the right hon. Gentleman the Member for Derby (Mr. J. H. Thomas) and my right hon. Friend the Secretary of State for War. It leaves it in a very unsatisfactory position. My right hon. Friend the Secretary of State for War wound up with these words:
"The right hon. Gentleman was engaged in discussing this Bill, and he was suggesting that we were keeping under the Bill a large reserve which might be called up under the Bill in case of civil disturbance. I say that is not so."
These are the words of my right hon. Friend the Secretary of State for War.
"This Bill will not prolong the liability of a single man who is released from the Army after

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the period of the ordinary Military Service Acts has lapsed on the ratification of peace. He remains liable until the old Military Service Acts lapse, but this Bill which we are discussing in no way prolongs his liability to be called up, and he cannot be called up after the Military Service Acts lapse without a new Act of Parliament."— [OFFICIAL REPORT, 6th March, 1919, col. 699, Vol. 113.]
It is that point we want cleared up. I should like to ask my right hon. and gallant Friend this simple question. He can, as a matter of fact, re-embody every man in Class Z Reserve to-day in the Army at any moment. He can do that up to the date on which the Military Service Acts lapse. Not only could he do that, but if, for example, circumstances occurred—we need not state them—and the Military Service Acts were about to lapse, the men could all be embodied in such a way that they would be under this Bill. I thought I heard the right hon. Gentleman say that he saw the point. Well, we want to get that point, which is a perfectly fair point, cleared up, as it concerns over 1,000,000 men. You could re-embody them. Let me put it rather more plainly. They are not discharged. They are only demobilised. They can be recalled. My right hon. Friend has said they will be permanently discharged when peace is ratified and the Military Service Acts expire. Before that moment, however—and that moment may be delayed—every one of these men may be re-embodied and become subject to this Bill, and, therefore, conscripted. We want to get that position tidied up. It is not good enough to say across the floor of the House that the Government have no intention of doing this or that. That has been said too often during the War. It may be that Ministers have not been able to keep their promises on account of certain circumstances. Now, however, we have a clear issue. Now that it is quite certain that so far as the ratification of the peace is concerned you will not require these men for that ad hoc or any other purpose, whatever you may require them for in the future, so far as this is concerned let it be quite clear that the men who have been taken by this Bill, first of all, cannot be employed in labour units doing work which can easily be done otherwise; and secondly, that the men who have been demobilised and who may become subject to this new Act cannot be re-embodied and used for the purpose of interfering in industrial disputes. It is a real, a substantial point. It is one of
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those points which creates the suspicion which exists in the public mind. The right hon. Gentleman may say, "No." As a matter of fact, one of the causes of suspicion which does exist is that the people are never quite sure what the Government are going to do. If the Government have not got this power, if they do not want it—and they say they do not want it—and my right hon. Friend has said over and over again that they do not want it, and that the first thing to do is to get these men discharged—very well, let us have it in the Bill, in black and white. Let us know where we are, and that will be a satisfactory position. I beg to move.
Colonel WEDGWOOD: We have got to recognise, and the Government have to recognise, that the working classes of this country are in an extremely anxious state of mind. I have been speaking at anti-Conscription meetings all over the country, and I can assure the Government that the one thing the people are mostly anxious about is what they call industrial conscription. They are afraid, judging from the examples at present in France and Spain, that if the Government is given the opportunity of conscripting men to break a strike that the Government will use those powers on some future occasion. I myself do not for one moment believe that the Government intend to do anything half so foolish. The British working man, whether he is in uniform or out of it, is incapable of distinguishing in connection with any labour dispute in the way suggested. The men who have been put in Class Z under such circumstances would have to rejoin the Colours if they were ordered so to do; but the position is perfectly well known at the War Office, and I do not believe there is the slightest intention on the part of the Government to call these men to the Colours, or use the men in labour units for the purposes of strike breaking. But it gives suspicion, anxiety, and nervousness to the working people of the country, to the transport workers for instance, and other trade unions, and the Government should avoid any shadow of an excuse for leaving the suspicion in the minds of the people that a conscript army could be used in any way against labour disputes. That is one of my reasons for supporting this Amendment. We want to have a perfectly clean slate so far as industrial conscription is concerned. It would be utterly futile to try to use force in industrial disputes. It will be probably the

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start of the trouble which we wish to avoid. It would be far better in dealing with such disputes to call upon volunteers to do the work rather than to attempt to use the Military Service Acts by employing a body of people who themselves belong to trade unions, and who certainly consider their loyalty to their trade unions transcends their loyalty to their military duties. That is the main reason why I want this cut out of the Bill.
Besides, there are several other reasons. I myself think that it is most important that we should not use and keep on using men in labour units when these men are either doing work that is of no service at all to this country or not doing any work at all. At present you have a great many men employed in France and Belgium tidying up the country. I saw them a very few months ago—the thing may have changed since—but they were making the roads and streets in the ruined towns, while able-bodied young men of the country, Belgians and French, smoking cigarettes, looked on at the spectacle. Nothing could be more detrimental to the discipline of the British Army than this sort of thing, and nothing more dissatisfying to the men who are doing the work. We do not want to have people employed in that way doing donkey work which can be perfectly well done by coloured labour, or by the inhabitants of the country themselves, provided they were paid for it by us or by the Government of the country which is to be improved in this way. We have also labour units in this country. There is the Middlesex Regiment. In it are labour units composed of Germans or Austrians, or some other folk of that sort. They are British subjects, and therefore liable for service, but because of their parentage they have been put into a labour unit. They have never been sent abroad, but have been kept somewhere in Rent. That unit is of no service, but is one of expense. They are not being used for any useful purpose. The corps is more or less a penal one. It is kept going for the purpose of saying that these people are not being disbanded in advance of others. We have, however, got to look at this thing not only from the point of view of the Army, but from the point of view of the British taxpayer. If we are keeping up a regiment, it may be of 1,000 men—and I do not know whether these labour units run to 5,000, 10,000, or 20,000—if we are going to keep up these units it is going
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to cost the taxpayer of this country a great deal of money. I protest against the idea of the Army being a sort of cross between Wormwood Scrubs and civil life. We ought not to retain an Army whose services are no longer required because for reasons quite other than military reasons their retention with the Colours is considered desirable in the interests of Army moral. If we get this into the Bill, these people employed in these utterly useless, economically unsound labour units either doing work in France which can perfectly well be done by the natives, or being kept in this country digging pits one day and filling them up the next—like Penelope weaving the web by day and pulling it to pieces by night—will have their labours, I trust, come to an end. Whether these labour units are doing either of these forms of work, the taxpayer of this country is being penalised to-day and the future prosperity of the country is being handicapped by reason of the great expenditure involved.
There is every reason now for exercising the most stringent economy, even in the smallish matters like this. If we can say, save on the labour units during next year perhaps £100,000, or it may be £250,000, so much the better. I do, however, submit to the House that to keep these units solely to be able to say that these men are not demobilised before other men, solely, I say, with that object and not to create complaints against the longer demobilisation of the other men, is a very great mistake, and one which ought to be put a stop to at the earliest possible moment. It is true that, on this occasion we cannot debate the question of expense. If these words, however, are inserted in the Sub-section, if in the Bill a provision is inserted, which means that the men kept under Conscription shall not be men in the labour units, which means that these other regiments, like the Middlesex Regiment or other regiments of shirkers, shall not be kept permanently in the Army, but shall get their demobilisation automatically on the declaration of peace, or some day conveniently near it, then we shall have saved the country a great deal of money, and at the same time we shall be preventing an undoubtedly erroneous-impression gaining ground amongst the working classes of this country, that the Government is slipping into this Bill, by more or less underhand means, a provision whereby industrial conscription can be put into force and labour disputes broken.

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For both these reasons, I do beg my right hon. Friend that he will allow these words to be inserted so as to remove misapprehension and to reduce the expenditure to the British taxpayer.
Captain GUEST: I shall deal specifically with the Amendment on the Paper rather than travel over wider ground. I would ask the House—and I believe that hon. Members do do so from their own experience of the different units during the War—to appreciate the fact that it is impossible to distinguish between labour units and fighting units when you are dealing with one well-organised military machine. Although it is quite true that the active part of the campaign is over, we want to retain a certain proportion of men who are classified as labour units to perform those really very necessary important subsidiary duties which run in the wake of an army. It would be seen at a glance that a great deal of military railway work, which is connected with the Army, the moving of its concerns, the preparation of its roadways, and so on, must be performed by what are described as labour units. There may be sufficient labour in the country concerned, but the work to which I have referred could not be done as satisfactorily for the needs of the Army as if the Army itself attended to it. These labours undoubtedly add to the efficiency of the Army. The point raised by my hon. and gallant Friend who seconded the Amendment, I think, can be answered very simply, as to the units not being required. It is quite clear if the men are fit to work that they will find their place in the Army in some equally useful capacity.
The only other point is that it would not be really practical to call upon the inhabitants of those countries in which our Armies are operating to undertake the labour which my hon. Friend imagines these units undertake. It is not that kind of work at all, and there would be great difficulty in getting foreigners to undertake the type of work which we require. Then, again, there is the difficulty of understanding the language and you have not the same control over foreigners. It is only reasonable that in our own areas we should do this work ourselves. The system adopted is the one which has been followed during the War, and it cannot be altered now.
Mr. KILEY: I rise to support this Amendment because I am desirous of putting a stop to the colossal waste which is going on in connection with the employment of labour battalions. There are, I understand, some 200,000 or 300,000 men engaged on labour work, and these are outside the men engaged in Army Service Corps work, or the men engaged in the Royal Engineers, who are supposed to do railway and other constructional work. It has been my duty as chairman of a tribunal to provide a large number of men for these Labour battalions. They included the "halt, the lame, and the blind," and we had difficulty in sending them into the Army at all, and we only did so because the Army Service representative said that these men should do something to relieve fit men to do the fighting. There is no fighting now, and consequently the fighting men must have some occupation. There is little or nothing to do for these hundreds and thousands of men who are now being kept in khaki at colossal cost to the nation.
These are nearly all low-grade men, who are fit for light jobs in their own factories and occupations. Many of them happen to be tailors, and what have they done with them? We have taken them out of the tailor's shop, we have given them a pick and a shovel, and there are working in Wales thousands of men who are totally unsuitable trying to make roads. I have no objection to their making roads in Wales, but I submit that you could get those roads made much cheaper if you gave the work out to a contractor and let him engage suitable labour men who are accustomed to the work, and then you will get that work done more to the advantage of the nation than by taking a number of tailors or other men who are physically unfit to do this work. This is not the case alone in Wales, for we have it practically in all parts of the world.
I had brought to my notice the other day the case of a man with a poultry farm in this country, and he was a C 3 man. He was sent abroad to Mesopotamia, and I hear that he is now rearing poultry out there. His wife came to me the other day to say that she was going to be turned out of her poultry farm because she could not work it, and this at the time that her husband is doing the same kind of work in Mesopotamia. I could quote many similar instances of men totally unfit for any military work who are being kept in khaki at a great cost to the nation

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without any sufficient return. There is one point which I hope the right hon. Gentleman will deal with, and it is that of using men in khaki for industrial disputes. I understand the Amendment dealing with that subject will not be raised, and I should like to hear something said on that point from the Front Bench.
Mr. ARNOLD: I wish to speak from the point of view of the employment of soldiers in substitution for civilians in labour disputes. We wish to lessen the power which military conscription has over industrial conscription. We had this question brought up in the Debates on the Military Service Acts in the last Parliament. I know that our contention was denied by the Government, and they promised Amendments and gave us pledges; but although you give pledges and promise Amendments till you are black in the face, military conscription will always involve a certain amount of industrial conscription. When this question was under discussion in the House the Leader of the House said, in relation to industrial conscription:
"This Bill does not give a shadow of industrial conscription. All through the War such a thing never arose, and in any case this Bill does not give one iota of power for that purpose, and it is a shadow they are afraid of."
Surely the Leader of the House forgets what has happened during the War. It cannot be denied that the engineers' strike last year was broken down by means of the Military Service Act, because the men were threatened that unless they returned to work they would be taken into the Army. Again, in the recent railway strike soldiers were used to run the trains, and therefore in both those cases there was industrial conscription. If the Government is sincere in this matter, and the words of the Leader of the House hold good, the Secretary of State for War ought to accept this Amendment, because without this Amendment the position will not be safeguarded. This Bill is put forward for military purposes, in order to obtain an Army of Occupation to garrison Egypt, Malta, Mesopotamia, and so forth, and it is not put forward for any Labour purpose, or to give the Government any additional power in industrial disputes. Therefore, it is not right that the Government should have power by means of this Bill to intervene in industrial disputes. As has already been pointed out, unless an Amendment like this is accepted, power is
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given to the Government in two ways: First, by employing soldiers in industrial work, as was done in the recent railway dispute; and, secondly, by mobilising; strikers and compelling them to do work as soldiers which they would refuse to do as civilians.
There is one other consideration, and it is that this Bill will expire on 30th April, 1920, and then, we are told, it will not be renewed. Then they say the Government will not have this power which the Bill now gives them in industrial matters over such a large number of men. If that is so, why should they have the power now, seeing that the Bill is put forward purely for military purposes? Reference has been made to industrial unrest. I fear that will be greatly aggravated if this weapon against the workers is to be retained. We are told that this is solely to wind up the War, and for these reasons I trust the right hon. Gentleman will accept this Amendment.
Mr. T. THOMSON: I wish very briefly to support the Amendment, especially in regard to its economic application. We have been told that active operations are in progress, and that it is absolutely necessary to have transportation, and to have these labour units and others organised. I know from my own experience of the work done abroad that it was done most excellently in that respect, but it was done at a most lavish cost, and, as anyone with inside knowledge knows, it was done at a tremendous waste. Under the circumstances of the War, the taxpayer overlooked all this on account of the urgency of the work, but now that operations have ceased this waste should not continue, and the fighting forces are quite adequate to provide all the labour services that may be required whilst they move from place to place for the upkeep of their camps and the maintenance of roads.
In active operations a large number of coloured troops, including Chinese and others, are employed for this purpose. German prisoners and the natives of Belgium and France were employed doing this work for the Army, and I submit that it is an economic fallacy to keep able-bodied men not really required for that purpose overseas when the work could be done by German prisoners, Chinese and other coloured troops or by the native populations of the countries occupied. We are compelling the enemy to demobilise their troops and at the same time we are

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sending men who would be of economic value in the industrial world into Germany at a time when we want to keep as few men overseas as possible.
Those men overseas are largely wasting their time. I have had letters stating that these men are employed making tennis courts and in other ways doing work which is no use for the Army. I think from an economic point of view we should be adopting a sound policy if we had those men here doing some useful labour instead of wasting their time, and serving no real purpose so far as the Army is concerned. The work they are now doing could be done by the fighting units with very little reorganisation. The waste that is going on is tremendous, although the War Office will not admit it. Those who have been behind the scenes and have made returns to the Army authorities know better than some hon. Members what a tremendous waste has gone on, and the sooner we stop this economic waste the better it will be for the Army and the country.
Mr. WIGNALL: I support this Amendment because I have come into contact constantly with the men who have been retained in these labour units and their relatives, and I know what is going on. I think the House will agree when I say that, although there may be enormous unrest and discontent among the men who are retained in the fighting line, it is nothing compared with the discontent and unrest among the men who say that they are retained for no real purpose, and that they could be using their time to better advantage if they were released from the Army and allowed to return to civilian occupations. There is intense dissatisfaction among the men who are retained in these labour units. I have come in contact with them everywhere, and one must realise that they are practically of no value from an economic point of view. You cannot compel a man to work if his heart is not in it; and I make the statement, without any fear of contradiction, that no man in the labour units has his heart in the work. He feels that the War is over and that the need for him no longer exists. The man who is retained in the Army of Occupation knows that there is something for which he must be prepared. He is sent over there for a definite and specific purpose. He has an object in view, and he knows that he is necessary for the upkeep of that Army and to perform certain duties if the occa-
316
sion should arise. But our labour units and all the accessories that were absolutely necessary when the fighting was proceeding are not necessary to-day.
I do not take the view which has been expressed so forcibly, that the Government have any ulterior motive in preparing for industrial strikes. I do not think that the Government have that in mind at all, though I know, if there were any need for the military to be used to break strikes, they would be used to-day just as they were used twenty and thirty years ago. I support the Amendment because, in my opinion, it is unfair to keep a man away from his home, his family, and his civilian occupation, unless there is real necessity. It is unfair and it is wrong to continue to employ that man in a labour unit when the necessity no longer exists. Therefore, I most heartily support the Amendment and hope that the Government will see their way to accept it. It will give intense satisfaction. I believe that a great deal of the discontent and unrest that manifested itself some few months ago when demobilisation had to be speeded up and men were released quicker than we ever thought possible started in the labour camps in this and other countries, because the men there felt that their work was done and that they should be sent home. I therefore hope and trust that the Government will see their way to make some differentiation between the man who is required in the fighting force and the man who is wasting his time—I say emphatically wasting his time and the revenue of the country—in being kept shut up in these labour camps and made to do work that civilian labour could do. He should be engaged in a civilian occupation, and should be restored to his home and family.
Mr. CHURCHILL: I hope that the House will come to a conclusion on this question in the course of the next few minutes. The issue is a double one, but both aspects of it are quite simple. The Labour units, as was explained by my hon. and gallant Friend (Captain Quest), are an essential part of the Army. You cannot have a modern Army without labour units for clerical work, for salvage work, for the upkeep of communications, and for many other purposes. These units are indispensable in their proper proportion, and you might just as well have an Army without artillery or telegraph corps as without labour units. Therefore, if there is a necessity

317
for us to maintain an Army, which must have the power of movement should the emergency arise, it is essential that it should be equipped with all the ancillary services. I agree with much in the speech to which we have just listened. There is no doubt a great deal of waste of men's time and labour in regard to these labour units, and I have no doubt that many instances have occurred of men being kept when there has been no reasonable work for them to do, but something must be said for the uncertainty of our situation which has been changing from week to week, and for the uncertainty as to how the process of demobilisation would work out. We have to keep up the transportation for so many men passing along the roads, through the camps and different stations, across the Channel, and through the dispersal camps. It may well be that here and there, and in many places, there are from time to time units and individuals who find that during this period of demobilisation there is very little useful work for them to do, but when I remind the House, as I mentioned to-day at Question Time, that more than two and a quarter million officers and men have been actually released in the few weeks of this present year, I think we are entitled to say that we are releasing the great Army that has won the War and replacing them among their families and in the civil life of the country at the earliest possible moment.
With regard to these labour units, I have been giving attention particularly to the agricultural companies. It is perfectly clear that the men in the agricultural companies who are not in the retained classes should be immediately demobilised and we are doing that as fast as we can. Orders have been given to accelerate that process. But the men in the agricultural companies who are in the retained classes must be transferred to the military services. There is no reason why they should go simply because they are in the agricultural companies. They will go to increase the general pool available for the forces that we are keeping, and they will be one of the factors to enable us to reduce the forces steadily, either by lowering the age, or releasing the men with two stripes, or reducing the date of service, or by any of the other compassionate or special methods that have found favour now in this quarter and now in that, and which I fully agree should in the next few weeks be considered so as to make the
318
burden fall on the exact minimum that we require and make it fall so as to cause the least possible injury or hardship to the individual. We could not, however, accept the Amendment that no man should be employed in a labour unit, because that would mutilate the Army and make it no longer an effective fighting force. We should have to transfer the men from the labour units to the Regular service of the Line, and we should then have to engage on such terms as were possible fresh men from this country to go out to the different theatres where our Armies are detained to do the work done by the labour units. We should have men in France or Germany who would not be under any military discipline, and that would give rise to all sorts of difficulties, quite apart from the fact that you would have to form new units to discharge the essential services without which no modern Army can live. As long as you have an Army in the field it must be supplied with labour units for these particular services. I quite agree that every economy must be used in regard to them and that no unit should be kept unnecessarily. That is our intention.
The second aspect of the question which is before us is really capable of being made much of or of being made little of, according to taste. It is quite easy to draw a picture of a wicked Government coming forward in the face of all its election pledges and conscripting an enormous army, which, when it is not employed in the heart of Russia, is to be employed suppressing strikes here at home. It is quite possible to conjure up a picture of that kind, but nothing would be more remote from the real facts with which we have to deal. There is no intention on the part of the Government, and they have never brought forward this Bill with any idea, of dealing in an exceptional manner with labour disputes.
Mr. ARNOLD: Will you accept the second Amendment?
8.0 P.M.
Mr. CHURCHILL: I do not propose to accept any Amendment narrowing the constitutional duties of the British soldier. It would be highly objectionable to do so. As I said in Grand Committee, the duties of the British soldier are embodied in the constitutional law and in the long custom and practice of this country, and I quite agree that they are not capable of a precise definition. Great judgments have been given on such subjects, and, as my hon. and gallant Friend has said, com-

319
missions have been appointed which have reached no very clear conclusion. But even if we are going to define the exact constitutional duties and position of the British soldier in precise terms, this Bill is certainly not the place to do it, and it would be perfectly absurd to have two kinds of soldier. One hundred and thirty thousand men have volunteered and are serving on pre-war engagements; 30,000 of them are invalids, and I do not know that you can get any great advantage out of them. Conceive what would happen if in regard to the soldiers affected by this Bill we were to define a particular set of duties which did not apply to other men who enlisted before the War. You would have two different classes of soldiers, one of whom would have had his duties denned and narrowed for him by specific legislation, and the other of whom would rest on what I may call the general constitutional law and practice of the country, and the position would be really absurd. I thought the hon. Member who spoke last used very outspoken language as to what the Army would do to break a strike, and so on. It is to my mind abhorrent that troops should be used to interfere in any ordinary question between capital and labour. If there was a dispute about how much the employers ought to pay, or about what hours the men ought to work, and so forth, I go even further than the hon. Gentleman, and say that I do not think it is at all within the region of proper action that troops should be employed, and I do not believe the military authorities would contemplate—[An HON. MEMBER: "It has been done!"]—No, I do not think so. The maintenance of vital services stands on a different footing. The maintenance of vital services, which affect the life and safety and health and well-being of the populace is in a some-
what different category; but such ideas have not in any way affected the bringing forward of this Bill. As I have said, the position of the soldier under this Bill is exactly what it was under the Military Service Act, and the position of the soldier under the Military Service Act was exactly what it was under our old voluntary system. Therefore, if it is sought to deal with the position of the soldier in these matters I do not think it should be by an Amendment to this Bill or by application to any particular class of soldier. I think a measure should be brought forward defining the duties of the soldier in relation to other citizens as a separate Bill, and that that should apply not merely during the currency of this Bill and to particular soldiers, but to all soldiers, and permanently, as part of the law of the land.
An HON. MEMBER: Will the right hon. Gentleman do that?
Mr. CHURCHILL: No, I do not feel inclined to add to the legislative burden of the Session by undertaking such a task on behalf of the War Office, but it is quite open to my right hon. Friend opposite to make an excursion into the realm of constitutional law and to draft a Bill defining accurately the functions of a soldier, be he conscript or be he volunteer, and to take advantage of the Parliamentary opportunities which are provided to carry his measure into effect. I hope it may now be possible for us to terminate the present Amendment before the Debate comes to a close at 8.15, so that we may be able to-morrow, when the House reassembles, to proceed at once with the question of the date when the Bill should terminate.
Question put,
"That the words, 'but not for service in any labour unit' be there inserted in the Bill."
The House divided: Ayes, 65; Noes, 242.

Division No. 18.]

AYES.

[8.5 p.m.

Acland, Rt. Hon. Francis Dyke

Devlin, Joseph

Jones, Henry Haydn (Merioneth)

Adamson, Rt. Hon. William

Edwards, C. (Bedwellty)

Jones, J. (Silvertown)

Arnold, Sydney

Edwards, Major J. (Aberavon)

Kiley, James Daniel

Bell, James (Ormskirk)

Galbraith, Samuel

Lunn, William

Bentinck, Lt.-Col Lord H. Cavendish-

Glanville, Harold James

M'Lean, Neil (Glasgow, Govan)

Brace, Rt. Hon. William

Graham, D. M. (Hamilton)

Morgan, Major D. Watts

Bramsdon, Sir T.

Graham, W. (Edinburgh)

Murray, Dr. D. (Western Isles)

Breese, Major C. E.

Griffiths, T. (Pontypool)

Onions, Alfred

Briant, F.

Grundy, T. W.

Parkinson, John Allen (Wigan)

Brown, J. (Ayr and Bute)

Hayday, A.

Raffan, Peter Wilson

Cairns, John

Hayward, Major Evan

Redmond, Captain William A.

Carter, W. (Mansfield)

Hinds, John

Rees, Captain J. Tudor (Barnstaple)

Clynes, Rt. Hon. J. R.

Hirst, G. H.

Richardson, R. (Houghton)

Crooks, Rt. Hon. William

Hogge, J. M.

Roberts, F. O. (W. Bromwich)

Davies, Alfred (Clitheroe)

Holmes, J. S.

Royce, William Stapleton

Davison, J. E. (Smethwick)

Irving, Dan

Sexton, James

Shaw, Tom (Preston)

Thomas, Brig-Gen. Sir O. (Anglesey)

Williams, Col. P. (Middlesbrough)

Short, A. (Wednesbury)

Thomson, T. (Middlesbrough, W.)

Wilson, W. T. (Westhoughton)

Sitch, C. H.

Walsh, S. (Ince, Lanes.)

Young, Robert (Newton, Lancs.)

Smith, W. (Wellingborough)

Wedgwood, Col. Josiah C.

Spoor, B. G.

White, Charles F. (Derby, W.)

TELLERS FOR THE AYES.—Mr. G. Thorne and Captain A. Smith.

Swan, J. E. C.

Wignall, James

Taylor, J. W. (Chester-le-Street)

Wilkie, Alexander

NOES.

Adair, Rear-Admiral

Dockrell, Sir M.

Lyle-Samuel, A. (Eye, E. Suffolk)

Agg-Gardnar, Sir James Tynte

Doyle, N. Grattan

Lyon, L.

Ainsworth, Captain C.

Eagar, Clifford

M'Donald, Dr. B. F. P. (Wallasey)

Amery, Lieut.-col. L. C. M. S.

Falcon, Captain M.

M'Donald, D. H. (Bothwell, Lanark)

Archdale, toward M.

Farquharson, Major A. C.

M'Guffin, Samuel

Astbury, Lt.-Com. F. W.

Fell, Sir Arthur

Mackinder, Halford J.

Astor, Major Hon. Waldorf

Flannery, Sir J. Fortescue

Macnamara, Rt. Hon. Dr. T. J.

Atkey, A. R.

Foreman, H.

Macquisten, F. A.

Austin, Sir H.

Forestier-Walker, L.

Maitland, Sir A. D. Steel-

Bagley, Captain E. A.

Foxcroft, Captain C.

Manville, Edward

Baird, John Lawrence

Fraser, Major Sir Keith

Mason, Robert

Baldwin, Stanley

Gange, E. S.

Middlebrook, Sir William

Balfour, George (Hampstead)

Gardiner, J. (Perth)

Mitchell, William Lane-

Banner, Sir J. S. Harmood-

Geddes, Rt. Hon. Sir A. C. (Basingstoke)

Moles, Thomas

Barnston, Major Harry

Gibbs, Colonel George Abraham

Melson, Major John Elsdale

Barrie, C. C.

Gilbert, James Daniel

Mond, Rt. Hon. Sir Alfred Mortti

Beck, Arthur Cecil

Gilmour, Lt.-Col. John

Moore, Maj.-Gen. Sir Newton J.

Ball, Lieut.-Col. W. C. H. (Devizes)

Glyn, Major R.

Moore-Brabazon, Lt.-Col. J. C. T.

Bellairs, Com. Carlyon W.

Goff, Sir R. Park

Morden, Col. H. Grant

Benn, Sir Arthur S. (Plymouth)

Gray, Major E.

Moreing, Captain Algernon H.

Bann, Com. Ian Hamilton (G'nwich)

Green, J. F. (Leicester)

Mosley, Oswald

Bennett, T. J.

Greig, Col. James William

Mount, William Arthur

Betterton, H. B.

Gretton, Col. John

Murray, John (Leeds, W.)

Bigland, Alfred

Griggs, Sir Peter

Nall, Major Joseph

Blair, Major Reginald

Guest, Capt. Hon. F. E. (Dorset, E.)

Neal, Arthur

Blake, Sir Francis Douglas

Guinness, Lt.-Col. Hon. W. E. (B. St. E.)

Nelson, R. F. W. R.

Blane, T. A.

Hacking, Captain D. H.

Newman, Major J. (Finchley, Mddx.)

Borwick, Major G. O.

Hailwood, A.

Newman, Sir R. H. S. D. (Exeter)

Boscawen, Sir Arthur Griffith-

Hall, Lieut.-Col. Sir Fred (Dulwich)

Nicholl, Com. Sir Edward

Bowyer, Capt. G. W. E.

Hallas, E.

Parker, James

Boyd-Carpenter, Major A.

Hambro, Angus Valdemar

Peel, Lt.-Col. R. F. (Woodbridge)

Brackenbury, Col. H. L.

Hamilton, Major C. G. C. (Altrincham)

Perkins, Walter Frank

Brassey, H. L. C.

Harmsworth, Cecil B. (Luton, Beds.)

Perring, William George

Bridgeman, William Clive

Henderson, Major V. L.

Pinkham, Lieut.-Col. Charles

Briggs, Harold

Hennessy, Major G.

Pratt, John William

Brittain, Sir Harry E.

Herbert, Dennis (Hertford)

Pulley, Charles Thornton

Broad, Thomas Tucker

Hickman, Brig.-Gen. Thomas E.

Rankin, Capt. James S.

Brown, Captain D. C. (Hexham)

Hilder, Lieut.-Col. F.

Raper, A. Baldwin

Buckley, Lt.-Col. A.

Hood, Joseph

Ratcliffe, Henry Butler

Bull, Rt. Hon. Sir William James

Hope, Harry (Stirling)

Raw, Lt.-Col. Dr. N.

Burn, T. H. (Belfast)

Hope, James Fitzalan (Sheffield)

Reid, D. D.

Butcher, Sir J. G.

Hope, Lt.-Col. Sir J. (Midlothian)

Renwick, G.

Campbell, J. G. D.

Hopkins, J. W. W.

Richardson, Albion (Peckham)

Carr, W. T.

Hopkinson, Austin (Mossley)

Robinson, S. (Brecon and Radnor)

Cautley, Henry strother

Home, Edgar (Guildford)

Rodger, A. K.

Cecil, Rt. Hon. Evelyn (Aston Manor)

Hume-Williams, Sir Wm. Ellis

Roundell, Lt.-Col. R. F.

Chadwick, R. Burton

Hurd, P. A.

Rowlands, James

Cheyne, Sir William Watson

Hurst, Major G. B.

Rutherford, Sir W. W. (Edge Hill)

Churchill, Rt. Hon. Winston S.

Jackson, Lieut.-Col. Hon. F. S. (York)

Samuel, S. (Wandsworth, Putney)

Clough, R.

Jephcott, A. R.

Samuels, Rt. Hon. A. W. (Dublin Univ.)

Coates, Major Sir Edward F.

Jedrell, N. P.

Scott, Leslie (Liverpool, Exchange)

Cobb, Sir Cyril

Johnson, L. S.

Seager, Sir William

Cockerill, Brig-Gen. G. K.

Johnstons, J.

Shaw, Capt. W. T. (Forfar)

Cohen, Major J. B. B.

Jones, G. W. H. (Stoke Newington)

Shertt, Rt. Hon. E.

Colfox, Major W. P.

Jones, J. Towyn (Carmarthen)

Simm, Col. M. T.

Colvin, Brig -Gen. R. B.

Jones, Wm. Kennedy (Hornsey)

Smith, Harold (Warrington)

Conway, Sir W. Martin

Kidd, James

Sprot, Col. Sir Alexander

Cope, Major W. (Glamorgan)

King, Com. Douglas

Stanley, Col. Hon. G. F. (Preston)

Cory, J. H. (Cardiff)

Knights, Capt. H.

Steel, Major S. Strang

Courthope, Major George Loyd

Law, A. J. (Rochdale)

Stephenson, Col. H. K.

Cowan, D. M. (Scottish Univ.)

Law, Rt. Hon. A. Bonar (Glasgow)

Stewart, Gershom

Cozens-Hardy, Hon. W. H.

Lewis, Rt. Hon. J. H. (Univ. Wales)

Stoker Robert Burdon

Craig, Capt. C. (Antrim)

Lewis, T. A. (Pontypridd, Glam.)

Strauss, Edward Anthony

Craig, Col. Sir James (Down, Mid.)

Lister, Sir R. Ashton

Sugden, Lieut. W. H.

Craik, Rt. Hon. Sir Henry

Lloyd, George Butter

Surtees, Brig.-Gen. H. C.

Croft, Brig.-Gen. Henry Page

Locker-Lampson G. (Wood Green)

Sutherland, Sir William

Curzon, Commander Viscount

Lecker-Lampson, Com. O. (Hunt'don)

Taylor, J. (Dumbarton)

Davidson, Major-General J. H.

Lorden, John William

Terrell, G. (Chippenham, Wilts.)

Davies, Sir Joseph (Crewe)

Lort-Williams, J.

Terrell, Capt. R. (Henley, Oxford)

Davies, T. (Cirencester)

Loseby, Captain C. E.

Thomas, Sir R. (Wrexham, Denb.)

Davison, Sir W. H. (Kensington)

Lowther, Major C. (Cumberland, N.)

Thomas-Stanford, Charles

Dewhurst, Lieut. Com. H.

Lowther, Col. C. (Lonsdale, Lancs.)

Thomson, F. C. (Aberdeen, S.)

Dixon, Captain H.

Lyle, C. E. Leonard (Stratford)

Townley, Maximillian G.

322

323

Waddington, R.

White, Col. G. D. (Southport)

Wood, Sir J. (Stalybridge and Hyde)

Walker, Col. William Hall

Whitla, Sir William

Worsfold, T. Cate

Walton, J. (York, Don Valley)

Wild, Sir Ernest Edward

Worthington-Evans, Rt. Hon. Sir L.

Ward, Col. L. (Kingston-upon-Hull)

Williams, Lt.-Com. C. (Tavistock)

Yate, Col. Charles Edward

Wardle, George J.

Willoughby, Lt.-Col. Hon. Claud

Young, William (Perth and Kinross)

Watson, Captain John Bertrand

Wills, Lt.-Col. Sir Gilbert Alan H.

Weigall, Lt.-Col. W. E. G. A.

Wilson, Col. Leslie (Reading)

TELLERS FOR THE NOES.—Mr. Dudley Ward and Commander Eyres-Monsell.

Waston, Col. John W.

Wilson, Capt. A. Stanley (Hold'ness)

Whaler, Col. Granville C. H.

Wood, Major Hon. E. (Ripon)

Reasons for disagreeing to certain of the Lords Amendments to the Increase of Rent and Mortgage Interest (Restrictions) Bill, reported, and agreed to.

Bill, as amended (in the Standing Committee), to be further considered To-morrow.

IMPERIAL PREFERENCE.
Major NEWMAN: I beg to move,
"That, in the opinion of this House, the delay on the part of the Government to declare its policy for the protection of key industries, for the prevention of dumping, and for Imperial preference, is prejudicial to the reconstruction of trade and industry, to the production of revenue, and to the employment of labour."
The luck of the ballot has given me one of the few opportunities the Back Benches enjoy of pressing the Government, not so much as a private Member but as a citizen, on its policy on a vital point. Members who were returned last December to support the present Government were returned by a vote which altogether cut across old party ties.
An HON. MEMBER: Not all of them!
Major NEWMAN: I said, "Members who supported this Government." They were therefore returned to carry out a definitely clearly laid down policy. Without a doubt there were hundreds of thousands of electors who voted for what are called, "Coupon candidates," for one reason only. In the words of the Prime Minister they were told, and they believed, that "we must face questions of policy with new eyes, without regard to pre-war views or pre-war speeches." As regards the economic future of the country and the Empire, the Coalition leaders in November last were absolutely frank, clear, and courageous. The Prime Minister, in a letter to the Lord Privy Seal, gave to the economic policy of himself and of his Government, if returned to power, pride of place. I will quote what he said:
"I have already accepted the policy of Imperial Preference as defined in the resolutions of the Imperial Conference to the effect that a preference will be given on existing duties and on any
324
duties which may subsequently be imposed. As regards other aspects of this problem, I am prepared to say that the key industries on which the life of the nation depends must be preserved. I am prepared to say also that in order to keep up the present standard of production and develop it to the utmost extent possible it is necessary that security should be given against the unfair competition to which our industries have been in the past subjected by the dumping of goods below the actual cost of production. Beyond this I should say we must face all these questions with new eyes, without regard to pre-war views or pre-war speeches. The object which we have in view is to increase to the greatest possible extent production in this country, so that no man or woman may want and that all who do an honest day's work may have comfort for themselves and for their children."
Subsequently, the Prime Minister and the Lord Privy Seal, in their manifestoes to the electors just prior to the General Election, wrote as follows:
"One of the lessons which had been most clearly taught us by the War is the danger to the nation of being dependent upon other countries for vital supplies on which the life of the nation may depend. It is the intention, therefore, of the Government to preserve and sustain where necessary these key industries in the way which experience and examination may prove to be best adapted for the purpose. If production is to be maintained at the highest limit at home, security must be given against the unfair competition to which our industries may be subjected by the dumping of goods produced abroad and sold on our market below the actual cost of production."
So much for the Coalition policy, on which many hundreds of thousands of electors voted a few months ago. The Leader of the official Liberal party again on this particular plank was precise at any rate. Mr. Asquith declared that he was an unrepentant Free Trader. I am using "Free Trader," of course, in the conventional sense of being in favour of free imports. Only a few days ago there was a new programme put out at Manchester—a new Manchester programme—upon which, as I understand, the official Liberal party is to concentrate, and in that new programme the first plank is Free Trade, and consequently no tariffs. The Labour party, at the General Election, were equally clear and precise. In their manifesto they told the country, "Labour is firm against tariffs and for Free Trade." Again, of course, I am using "Free Trade" in the

325
conventional acceptance of the term. That manifesto was signed by all the eminent Labour leaders, including such men as Mr. Sidney Webb. Now, at any rate, here in this welter of coupon confusion, we have a clear-cut national issue, and we have absolutely clear-cut differences of party. We have had the election, and the Coalition won it, and if ever there was a Government that was given an absolutely clear mandate by the electorate, this Government was given a mandate to carry on fiscal policy in the way which was put before the country by the Prime Minister and the Lord Privy Seal. I realise that the Government has established something like a transition period between war and peace—a moratorium—until 1st September, and that in that position they have done themselves in, but the average man in the street wants to know what the Government is going to do after 1st September. Are they going over the top, come what may? If they are going over the top, have they got their objective clearly defined and their plan of campaign clearly thought out? Not only the United Kingdom, but the Empire wants to know that. No doubt hon. Members read, a few days ago, a speech made by one of the prominent Ministers of New Zealand (Mr. Fisher), in which he pointed out how anxiously they were awaiting the decision of the Imperial Government on the question of Imperial Preference, and he said that if the decision was not given soon it would greatly interfere with the trade of New Zealand, which would be diverted to and captured by such countries as Japan and America.
Leaving Imperial Preference aside for the moment, what about our home industries, our key industries—the dye trade, the glass trade and others? I imagine that it is absolutely unthinkable to any man, whether he be a Free Trader or a Tariff Reformer, that we should allow these key industries to be destroyed by foreign competition, whether it is the competition of an enemy country or of an Allied country. We have established these industries with great difficulty and they have been so vital to us during the War, and we cannot allow them to be lost by any sort of unfair competition. Of course, key industries are only comparatively few. What about the new industries which have been established since the War began? What about the competition which they will have to meet if they get no protection? I will quote what happened to a very small and comparatively unimportant industry. This
326
instance may seem almost trivial, but it is an example of what may be happening to small Britishers to-day who have had the pluck and initiative to dare to do certain things during the War, and who now, apparently, are reaping a very unfair reward. I received a letter the other day. My correspondent says:
"The company was formed in 1916 by two other friends and myself to undertake the manufacture of millboards, and leather boards, for which we were assured there was a great demand in England consequent on the cessation of the importation of Dutch straw boards. We purchased on old derelict mill, which in bygone years had been utilised for paper-making. We fitted the mill with new machinery and started operations in 1917. Owing to the restrictions imposed by Government and the difficulty in obtaining raw material the results of the first year's trading showed a heavy loss. As the result of good prices and the help the company received from the Controller of Paper and Raw Materials, the company made up a good proportion of this loss in 1918 and hoped to have a successful future. After the signing of the Armistice, the Government permitted the importation of cheap Dutch straw boards, and on the arrival of the consignment of these the demand for our manufactured goods came absolutely at an end, the result being we have recently been forced to close the works."
That may be a small example, but it is an example of what has happened, and is bound to happen up and down the country if certain protection is not given to these small infant industries. The case I have quoted is an instance of unfair competition, because the Dutch workman is paid a far lower wage than the English workman. What about the question of dumping? There, again, the Government have been perfectly explicit. They were explicit in their manifesto before the Election, and they have been explicit since the election. They spoke about dumping in the King's Speech—
"Measures will be devised for the prevention of the unfair competition of imported goods below their price in the country of their origin."
What the man in the street wants to know is this: "Does the Government mean here and now to take the necessary measures to prevent the dumping of Japanese and other cheaply-made goods?" Of course I realise, and the House will realise, that Japan is one of our Allies, but we cannot allow our trade to be ruined by the cheap labour of Japan. Take the case of Japanese hosiery, which is produced by Japanese operatives who work twelve hours a day for 1s. 6¾d. The Japanese manufacturer and mill owner runs his mill for a hundred and forty-four hours a week. How are our people to compete with that? How are our hosiery manufac-

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turers, who run their mills forty-four hours a week and pay the operatives perhaps an average of 60s. a week, to compete with that? I leave aside for the moment the foreign market, and I ask, How is the hosiery manufacturer in this country going to compete at home against competition of that sort?
I will give another instance of Japanese competition. Take the Irish hand-embroidery trade. That, in the North of Ireland, is a very important cottager's industry. How on earth can the Irish cottager, the Irish man or woman— especially in Ulster, where the circumstances of life are maintained, and rightly maintained, on a good standard—possibly compete in their cottage industry against the industry of the Japanese, where a man or woman is content to work for an average wage of Is. 6¾d.? Of course, it is perfectly impossible. The thing cannot be done. Other hon. Members could give instances similar to these. The average Britisher wants to know what the Government are going to do. He knows and we know that we have to have production, and we have to have increased production, and we have to keep our market. He knows and we know that at the moment our export trade is stagnant and at the same time the whole of the great industrial plants of America are working at full blast. If he did not know that, President Wilson has told us so. Apart from America, Japan, and other competitors, what is happening in Germany behind the camouflage of Spartacists, starvation, and so on? Do any of us know what the German manufacturer and the German workman are doing, what they are producing now, and what they are getting ready to dump upon us and upon other parts of the world once the blockade is raised? We do not know; we cannot tell. I imagine that the Government will tell me and my Friends that there is no need of particular hurry in announcing their fiscal policy, that the thing is all right until the 1st September. That only means, for Parliamentary purposes, three or four months. We shall be rising, I suppose, some time in August. Before September the decision has got to be taken on this question. Three or four months is a very short time in the history of a nation, and it is a very short time for the Government to let the country know what it means to do in a great question like this. This is the last chance which we private Members may
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have of pressing this subject, and I would beg the Government to tell us exactly what their fiscal policy is going to be. I have been returned to support the Government, and I will support the Government, but it is my duty to carry out the pledge which I gave to my Constituents to press forward the fiscal policy which I promised to support when I asked them to give me their votes, and to see that it is carried out by the Government with the least possible delay.
Mr. MACKINDER: I rise to second the Resolution moved by my hon. Friend. I do so in the hope of drawing from the Government a statement of a more definite character than any which we have yet had. We had a promise in the King's Speech. We had an interim statement from the Minister for Reconstruction in regard to the policy of the Government up to the 1st September. We who stand behind this Motion feel that that statement was wholly inadequate. I heard that statement and read it afterwards with great care, and it gave more satisfaction, it seemed to mean more, when I heard it than when I came to read it afterwards. At the present moment we have in the country a necessity which maybe indicated by the three words, production, enterprise, confidence. Everyone admits that the solution of our difficulties is only going to be obtained by great and increased production, but in order to obtain that production we must have enterprise, and the first condition of enterprise is confidence—confidence that you may calculate with reasonable probability, with businesslike probability, what the future is likely to bring. The A and Z of the position at present to my mind is the breeding of confidence. The Chancellor of the Exchequer, I think it was, said to us a week or two ago, when he was told Americans were taking forward orders in large quantities in various countries, among them even in enemy countries, that there was nothing to prevent our people doing the same thing. There is. There is lack of confidence. Our manufacturers are encouraged to step forward, to look forward, to make preparations for a distant date, to be ready when opportunity comes, and they are denied the elements upon which to make their calculations. Meantime you have in the United States hot industry, not only preparing but ready, held back,

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as Americans think, simply because of the restraint exercised by the Government of this country.
Take the labour position. There are many causes making for labour unrest, but admittedly one of those causes is the fact that labour fears unemployment on a great scale. The evidence of the statistics of the payments that are being made by the Government on account of unemployment at the present time is not encouraging. One of the facts that enterprise has to face at this moment is labour unrest, and labour unrest is connected with the probability of unemployment. You are in a vicious circle. Labour fears unemployment; enterprise fears labour difficulties. No one but the Government can break that vicious circle. The only way in which the Government can break it is by taking action likely to give confidence. In my belief if enterprise could become confident, if that confidence spread itself as it would do from the captains of industry down through all the grades of industry you would have solved not only many of the difficulties of our finance but also the difficulties connected with the general state of labour. We say that this declaration of policy will brook no such delay as is involved in a postponement until the 1st September, and I cannot help feeling that the course of recent events must be educating the Government in some degree to the fact that it is undesirable to continue this policy of procrastination. Take the story of the New Issues Regulations. I do not blame the Chancellor of the Exchequer. He came newly into office. A certain amount of time was essential to him to examine the position. He found a certain policy in force. At first he yielded to the arguments that were put before him and he issued regulations even more stringent in character than those we had before. Then he yielded somewhat from that, and now he has given way wholly, and given us almost complete liberty so far as the internal industry of this country is concerned. Is that not clear evidence that the Government themselves are realising what is the penalty of delay at the present time? If that be true in regard to one aspect of this problem is it not likely to be true also in regard to other aspects of what is the essential peace problem, the problem of giving confidence, and so engendering enterprise.
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I am not going to repeat in this House the old well-worn argument of Tariff Reform. I make the appeal to Members of all parties, Liberal and Labour, as well as Unionist, Free Trade Unionist as well as old Tariff Reform Unionist, to recognise the fact that we stand in a new position. In bringing the Resolution before the House we speak not only to the Government but to the Front Opposition Bench, or a portion of it at any rate, for we realise that we are between two fronts. I want not to repeat old shibboleths, but I am not ashamed of having been a Tariff Reformer. I was a Liberal in the 1900 election. I went over to Mr. Chamberlain in 1903 because I felt the situation of the Empire was a new situation. Hon. Members will remember that there were certain facts in view in those years, 1902–3–4, which may well be grouped together. Let me remind them of them. Not only did Mr. Chamberlain ask you to prepare measures for the defence of the trade of the Empire, but Lord Rosebery asked you to be more efficient, and Lord Roberts asked you to prepare your Army. At that time all those were looked upon as different movements. But was it not the case in fact that three wise men among us had read the signs of the times, had read the meaning of the Kaiser's letter to the President of the Transvaal Republic, had realised the meaning of the German navy laws, and had realised that we were steering straight to a world war. Some of us, feeling and knowing that in these modern days you could not say that this industry or that industry is preparing the material of war, but knowing that all industry would be involved in war, and knowing that food, and knowing that steel, and knowing that coal, and knowing that wool, and knowing that chemicals were practically all alike in the equipment of modern war, realised that there was no possible preparation for the great war that was coming but general defensiveness in regard to the whole of our trade. That was the reason why some of us who had been brought up in the pure faith of Adam Smith realised that the time had come when defence was more important than opulence. I know that my Friends on the Opposition Benches will say, "Yes, but you were accumulating those foreign investments which enabled you to tide over the great crisis of this War and enabled you to finance your Allies." That may be true, I admit, but may it not also be true if you had accumulated, even granting that

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would have been the effect, rather less in foreign invested wealth, and had here been prepared with the industrial mechanism that was necessary for equipping your Army, that you might either have not had to fight the War, or if you had, it might have lasted for a shorter time, in. that you would have been equipped earlier. In the long run, it mattered from the wealth point of view, little whether you had great wealth to squander in war accumulated beforehand, or less wealth and more equipment to fight the war so shortly. That was the position in regard to wealth. But the difference in regard to lives would have been immense, and the young lives of this country are the future wealth of this country. Therefore those who look only to wealth take a short view in our opinion.
But that is past. We believe we were right, but we recognise that the conditions that we were then preparing for are gone and past. For good or for ill this nation took the policy which it took in 1906, and this nation has come through, at whatever cost. But there is a vast change now, and if those old arguments tending to the defence of this Empire no longer hold with quite the same force, and if you say that it is improbable that during the next generation or two you will have to fight such a war as we were then preparing for, none the less I say if our old Tariff Reform arguments have no longer the same strength, neither have your old free import arguments. Those arguments were fitted to a position that held perhaps in the middle of last century. We will not discuss whether they held if you took a long view as well as a short view. But surely there can be no question now, having fought this War and having squandered your wealth, and having spent so large a proportion of your young vigorous life, that this nation now stands in a very different position from that in which it stood during the prosperous sunny years of the middle of last century! I ask my Friends the Tariff Reformers to put their old arguments on one side, and I also venture to ask Free Traders to put their arguments on one side. Let us face this question anew in the circumstances that hold to-day. We are no longer a creditor nation. The fall in the American exchange, now that control has been removed, indicates our real position. We stand in relation to America, financially, much as Germany stood in relation to us before the
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War. It is quite true that the French ex-change has risen, and it is quite true that if you could imagine there were an effective Russian exchange, that it would stand vastly nominally in our favour. But our debtors before the War were, on the whole, capable of paying. Our debtors to-day may, and we hope in the long run will, be able to pay; but for the time being we owe money and we shall have to honour our debts, and we are owed money and we shall have to be generous. We are no longer a creditor nation. What is the meaning of that? The meaning of that is that we have parted with, a natural protection. My Friends the Free Traders use the word "Protection" in a very narrow sense. They recognise only one form of Protection, whereas there are many forma of Protection. How did the fact that we were a creditor nation give Protection to our industry? It gave it in this way: We had investments abroad. The City of London, broadly speaking, administered those investments. We had investments, let us say, in railways in various countries. The companies controlling those railways, not only sent their profits to London, but had in London the offices which gave orders for the materials required for renewals and repairs upon those foreign railways, and in nine cases out of ten those orders were placed in this country. The fact that the City of London owned great investments abroad gave the power to the City of London of patronising the industries in the North of England.
You may say that we have not parted with all those investments at the present time. No; not yet. But the Stock Exchange is not freed from control yet, although the exchanges have been freed. When you come to a free Stock Exchange, free to sell abroad as well as in this country, will you not probably be faced with the position that money will be wanted in this country for a thousand purposes? We owe America money, and will you not settle many of your accounts by a series of transactions ending in the transferring to America of not a few of your South American investments? Given a free market I cannot help feeling that, this is bound to take place. The net effect will be that this industrial' country will lose one form of Protection which, under the former régime we claim it has had in a very powerful manner. The truth is, as Prince Bismarck once said:
"Free Trade is the policy of the strong."

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To him that hath shall be given. The fact we have to realise now is that, having stood forward and saved the world, we have spent our own substance, and we have to set out as a nation to make our fortune again. What is the result of that? It is that we stand in the position in which Germany stood before the War—the position which she has sacrificed. This country owned investments abroad. The interest, the dividends were paid through the City of London, and were reinvested from the City of London. But we shall find that source of profit bare, and we shall have to do what the Germans did—makes wares suitable for the market which we wish to woo, and we shall have to travel with our wares. Whereas we formerly sat in the City of London at the seat of custom, with the whole world coming to us, and giving orders to industry, in the future our captains of industry, taking counsel together, will have to organise their exhibitions, will have to organise their travellers, will have to see that they have far more intelligent travellers than ever before, and will have to travel the world in order to peddle out their wares. We shall have to build up again the fund which formerly we administered, precisely as Germany built up her fund and as the United States built up her fund. When the War came those two nations, by hard work in the way of manufacture, had put together funds and were rivalling us in the world's markets. Germany has sacrificed hers by her folly. This country has sacrificed hers, may I say by her heroism and her altruism, and the United States stands with double wealth at the present moment.
9.0 P.M.
Two courses are open to this country. You may return to your old policy. You may imagine still that your City is in command of the world. You may continue to lend and continue to order on the basis of what remains to you. If you do you will become an Amsterdam. The richest people, man for man, in the world are still the Dutch. But Holland is a country of traders, a country of ship-owners, a country doing trade before the War between Germany and the rest of the world, the owner of properties, in Java —but not a land for workmen on a great scale. That is your one possibility. You may become a rich, small bourgeois nation, or, on the other hand, you may determine to face the conditions of the future and you may determine that this nation will
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make its fortune afresh, that the strength of this nation shall lie, not in these fat bourgeoisie, living on the fortunes of the past, but in a great, vigorous, magnificent nation of workmen. If you are to do that, if you are to take the second course, then you must recognise the conditions of modern industry. What is the essence of success in modern industry? Manufacturing on a great scale. Article for article you cheapen, and you render more efficient the production if you produce on a great scale. You meet the conditions of the market because you can produce a greater number of varieties, you have a greater shop front. From every point of view—cheapness, efficiency, marketing, the necessity of the organisation of industry is that you should manufacture on a great scale. But what is the result of that? That you can no longer trust to that old condition of petty competition on which the laws of Adam Smith were based. If your vast organisations include under each separate administration production from the raw material to the finished article, if you count your capital by the hundred millions, your position is that you have left far behind that old petty chaffering of the market.
Our modern industrial organisations are recognising the fact, and every great industrial organisation is seeking to make its own steel, to own its own collieries, and to own its own pig-iron furnaces and rolling mills. If it be shipbuilding it makes its own engines and turbines, and does not act merely as the old-fashioned shipbuilder who merely put together the assembled parts in the shape of the ship. The reason for these vast organisations from the raw material to the finished product is that since industry must be on a great scale, and you no longer have free markets in which to buy your raw materials, you are subject to the whims of individuals whether those individuals own the raw materials or whether they are owned nationally. The world has to be refitted; it will take us many years to refit it after the destruction of this War. This country can grow rich again by bearing its share in that refitting, and we can make the great engines and great mechanisms which are required to equip the world once more in machinery. We can do it if you are going, as a nation, to behave as these great trade organisations behave, to equip yourselves completely from end to end with the necessaries of production. But then you must recognise the fact that you have got to face the

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Empire ownership of raw material, the protection of your key industries, and the prohibition of dumping.
As to your raw materials I have already said that half a dozen of the great ship-building companies in this country at the present moment have found it necessary to equip themselves step by step until they have got the ownership of collieries and iron mines. When we come to the key in dustries let me just remind the House of a fact—and especially would I venture to remind the Members of the Labour party. Last autumn it fell to me, in the absence of the present Chancellor of the Exchequer, who had undertaken the duty of opening an exhibition of key in dustries that was held 200 yards from this House—it fell to my lot to open it, and I ventured then to mention in my speech certain facts in regard to two key industries—tungsten and magnetos. I pointed out how 'tungsten was an essential, small it might be, in the making of hard steel, for cutting edges in machine tools and for many other purposes known to Sheffield. I pointed out too how the supply of tungsten in this country was sufficient only for a few weeks at the beginning of the War, while Germany had supplies sufficient for several years. I pointed out further the case of magnetos required for internal combustion engines, essential for motor cars, aeroplanes, and submarines, and how the magneto was almost entirely obtained from a single German firm, and that it took us two years in which to make the industry capable of equipping our aeroplanes, our motor-cars, and our submarines in competition with the Germans at the beginning of this War. I stated these facts. They were reported in the newspapers, and a gentleman wrote to me from a well-known club in London, and asked me, almost with threats, how I dared to put such nonsense before the public. He was a merchant in herrings. He had exported much weight and value in herrings to Germany before the War. "Surely," he said to me, "if it paid us to catch and cure herrings, and if it paid Germany to make tungsten and magnetos, then we are both the richer for it! Are you going to prohibit the Britisher from doing the most profitable thing?" I felt the case was hopeless, so I wrote back to the gentleman and told him I was afraid that he and I were worlds apart, and it would be hopeless for me to argue with him.
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But surely in that extreme, in that grotesque case, you have the essence of those old money economics—if we had caught a few less herrings and exported a few less to Germany, and if we had made a little more tungsten, we would have had a more balanced trade, and although we we might have made a trifle less profit we would have had the weapons—the hard steel and the internal combustion engines during the first year or two of the War, and the result would have been that thousands and tens of thousands of good British lives would have been saved for this country. In those economics, which look only at exchange, values, a thousand pounds worth of pig iron is deemed a fair exchange for a motor car worth a thousand pounds. But you have only to imagine the non-producing pig-iron nation producing motor cars to realise the difference in human life—the rough, splendid vigour, no doubt, of labour, producing coal and pig iron, the skilled, refined artisanship, and infinite variety of skilled labour needed to produce that magnificent product of modern industry, the motor. It is bad for any nation to consist entirely of rough labour or entirely of skilled artisans.
There only remains the case of dumping. I venture to put to the Government this special reason why it is necessary to hurry with their declaration of future policy. Labour rightly asks for better conditions in the future. But the terms of Mr. Justice Sankey's Report show the conditions upon which you are going to attain those better terms. Next summer Labour will get shorter hours, and not now immediately, and two years hence it will get still shorter hours. Why these delays of three months and two years and three months? It is in order that you may prepare the new organisation of industry that is necessary. If you are to give better conditions to Labour those better conditions are an investment, and all investments take time in which to produce their results. In America probably you have better conditions of labour, partly owing to the fact that there they have virgin soil and partly owing to the fact they are producing in a differently organised manner. But organisation takes time, and if you are to give these better conditions for which Labour has applied, and which it rightly deserves after this War, then you must recognise that if you are to obtain the great production which is necessary to save this nation and to save all

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civilisation, you will obtain it only by recognising the fact that shorter hours, more efficient work, and better pay can only give you the return after the lapse of a certain time after you have got the better paid men, after you have got the better home conditions, aye, and the full result will be when the children have grown up in the better homes.
All these better conditions of labour which you are going to obtain from higher wages and shorter hours are to be obtained only as investments for the future. Therefore, I ask the Government to announce, without a day's delay, what the future conditions are going to be, because if those captains of industry are to be able to organise labour and give employment to labour, are to be able to get to work to prepare the labour saving appliances, to prepare the better organisation, to prepare to seize the psychological moment when it comes, they want every day, every hour, now to put into thought and preparation. They have to brace themselves up to the courage which is necessary in the conditions of the future which will govern the world. You tell me—I may even hear it from these benches in the course of the Debate—that in some of your key industries you have adopted the method of prohibition with licences. There seems to be salvation in the minds of some of those hon. Gentlemen in regard to the method of prohibition with licences. It saves them from that terrible word "tariff." But what are they afraid of in the tariff? One thing they are afraid of is corruption, they tell us—undue pressure on Government Departments—lobbying in this House. Well, I do not know what the experience of any of them who are employers, any of them who are organisers of industry, has been during the War; but my impression is that the obtaining of licences to do this and that, and almost everything you do, involves delay, bad temper, endless irritation, loss of opportunities, and, I am not so sure in the long run, even some corruption. If you are to have arbitrary granting of licences which no man can calculate beforehand, with some dangers—let us grant it—of corruption, or a rule that each man can look to, and perhaps some dangers of corruption in the settling of the rule—recognise the fact that you have danger of corruption in either case. Neither will give you immunity. You have got to face that fact. But what is the difference? You ask for enterprise. You ask for an employer to put down
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£100,000, let us say, to put up a new plant to make some new industry in this country. That man has to calculate all manner of conditions—labour, foreign tariffs, cost of raw material, possibly new arrangements under the Ministry of Ways and Communications—an infinity of conditions. I would infinitely rather know the tariff or the prohibition that I was going to deal with than have to chance the influence that I might be able to bring to bear in order to obtain a licence to import or export. My friends tell me, "But surely if you do put on a low tariff it means a regular rule." I do not want to argue the whole question of tariffs, but I do say to the Government, "If you get prohibitions and if you get duties here and there for certain industries, you will end by finding it far simpler to have some general rule."
But I do finally put the point that if, as the result of duties, your industries make some profits and accumulate them, if the community does not get the whole advantage of the duty put on, that is not a very great disadvantage. It is not a very great disadvantage for this reason, that if you are starting a new industry you will not get the money from the City of London. They do not understand industries there. If you want to start a new industry, you will go to someone already engaged in industry, a rich man who knows the conditions of industry, and who, out of the profits he has saved, will finance your new industry. That is the practical way in which industries are started. There are two separate funds—the City fund and the industrial fund. You may do something in the future—I hope you may— from the savings of the populace. There are many hopeful, and, I am sorry to say, many disappointing facts with regard to War Savings Certificates. But do not let us hide the fact that the fund out of which industry is developed is the fund saved from the profits, and the thing you have to try to prevent is the distribution of undue dividends. Money saved and invested in the business will develop the industry. I am not afraid of the profits that have both got behind the tariff barrier. We are asking the Government to give us— because it is owing—some distinct indication of the policy they mean to follow after the 1st September, in order that enterprise may lay its plans now, while there is still time, and if those statements made this evening are such that those of us who stand behind this

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Resolution feel that we must make some protest in the Lobbies, then I would venture to put the position very shortly thus: In 1872 Mr. Disraeli from that bench used a famous geographical simile. Looking at the Government opposite to him, and pointing his hand from end to end of that bench at all the row of hoary heads, he compared them to the great range of the Andes Mountains, seen from the deck of a ship in the Pacific, with the great row of snow-clad caps to the extinct volcanoes. But my geographical simile will hit both that bench and the bench opposite. In the Mediterranean there is a certain Strait which was much feared by the mariners of antiquity. On the one side is the rock of Scylla; on the other side is the whirlpool of Charybdis. The whirlpool is there [pointing to the Treasury Bench]. The rock is there [pointing to the Front Opposition Bench]. The Government, urged by the necessities of the moment, have, I am afraid, no time to think, and they go round and round. We beg them to summon up courage to break their vicious circle, to stop their hesitancy, to give firm foundation for courage and for enterprise on the part of the country. And in certain parts, at any rate, of the Opposition Bench, there is, I fear, a rock of dogma and doctrine which even this War has not been explosive enough to blow up. They will tell me that it stands for economic truth. Grant it is economic truth, all truth is relative in its significance. That rock of Scylla, which was a danger to the mariners of antiquity, is now laughed at by the captains of modern steamers. Some of these hon. Gentlemen who stand upon that unexploded rock, who stand crowded on that little rock, forget that what was a truth of great importance in the 'twenties and the' forties of the last century has been dwarfed by the organisation of modern industry. I beg to second.
Sir DONALD MACLEAN: We have listened to two speeches which have interested the House very much, and notably that of my hon. Friend who has just sat down. His economic arguments were listened to with an affected interest, but I do not know that some of the metaphors with which he finished his very eloquent speech were not of equal interest to all the Members present. I do not know to which side he really allocates the snow-capped
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Andes or the extinct volcanoes. Apparently we can make our choice with regard to that. At any rate, he referred to us as being on a rock. All I say about that is that if hon. Members have to make a choice between a rock and a whirlpool, I should advise them to stick to the rock. But I want just to take the House back for a very few minutes to the Resolution which is before us. While my hon. Friend made detailed reference to the question of the key industries and also to the question of dumping, I noticed that he said nothing about the question of Imperial Preference, to which the now historical letter which was written by the Prime Minister to my right hon. Frend the Leader of the House, on 2nd November, gave dominating interest. Let me read the relevant sentence—
"I have already accepted the policy,"
said the Prime Minister,
"of Imperial Preference as defined in the resolutions of the Imperial Conference to the effect that Preference would be given on existing duties and on any duties which may subsequently be imposed."
I should like to confine what I have to say to that. Of course, we can only deal with the existing duties. We do not know what the future has before us in the matter of duties which may hereafter be imposed. But let us see what it really amounts to, this question of Imperial Preference on some of the existing duties. Take the question of tea. How does Imperial Preference work out on that point? The imports—I am taking the year 1913, the last year that I can get at—the imports for the Empire in that year were roughly 340,000,000 lbs., and from foreign countries 50,000,000 lbs. It will be seen that as far as the figures are concerned, the Empire holds a practical monopoly of the tea trade of this country. How is Imperial Preference really going to help us there? Our foreign tea comes mainly from China and from the Dutch East Indian possessions. Suppose we are going to have Preference on tea differentiated as against China? What is the position there? China in that year took nearly £15,000,000 worth of British manufactures. How is China going to be affected in regard to British merchants going to that country to sell British manufactures, if one of the very first things we do after this War is concluded—and China is, if not quite one of our Allies, certainly more than a friendly nation—is to put on a duty as against China? What is the

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position with regard to the Dutch East Indian Possessions? Holland gives no Preference to anybody; she has practically Free Trade, and our manufacturers have the same access to the overseas dominions of Holland as her own traders enjoy. Have the Government considered what would be the effect on those trading facilities at present granted by the Dutch Government to our traders if we started out by penalising Dutch tea? These are facts we have to deal with. After all, this is a business matter, and has to be dealt with on strictly business lines. What about the question' of sugar? Take refined sugar. From the Empire, in 1913, we imported 6,000 cwts., and from foreign countries we imported 18,450,000 cwts. Of unrefined sugar, from the Empire we imported 1,500,000 cwts., and 19,500,000 cwts. from foreign countries.
Brigadier-General CROFT: Will the right hon. Gentleman state which foreign countries?
Sir D. MACLEAN: It was outside the Empire, anyhow. We took an immense figure from Russia.
An HON. MEMBER: No, not from Russia—moderate.
Sir D. MACLEAN: The great bulk of our sugar coming from foreign countries, what is the Government policy? Are we to reduce the duty on sugar from the Empire and to increase the duty on what we can get from foreign countries?
Brigadier - General CROFT: Enemy countries.
Sir D. MACLEAN: I say foreign countries. It might be enemy countries, but if sugar comes from an enemy it is just as much sugar. You want sugar, and you want to get payment from our enemies. Will anyone tell me how you are going to get indemnities from our enemies other than by two ways, goods or services. It cannot be done. Gold, such gold as we can scramble for, amount to mere dust in the balance. There is only the one way of getting payment from an enemy or a friend outside these shores—goods or services. We all want cheap sugar, at any rate very ranch cheaper sugar than we have got. If you are; going to increase your duty on that, on the basis which the Prime Minister has promised to the Leader of the House, what will be the results Then again, I do not need to labour the question o£ wine. We shall be at once in trouble with our friends and
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Allies in France if we propose to give a preference to Australian, wine. The whole, resolves itself into this. Do my hon. Friends really wish to surround the British Empire with a ring fence of preferential duties, and set up a close system of tariffs here?
If you are going to have a ring fence of duties around the Empire, what about, those friendly countries who have been fighting and losing with us? The whole; situation, my hon. Friend below the Gangway knows very well, has in many respects fundamentally been changed in this War. That is common ground between us. That is a matter which we shall have very gravely to bear in mind. We have to deal with trading Allies, America, France, and. Belgium, so far as the latter can trade, Italy, and also others. I do not know how the League of Nations question comes in here. What does President Wilson say? "We are going to have a League of Nations. Each nation will set up its own system of tariffs, but as between all the nations then embodying the League, you must treat all alike." That is laid down there definitely. I would ask my hon. Friends to bring the matter down to a close business calculation of how we are to carry on our trade. I agree entirely with my hon. Friend in one thing: if we are driven into a system other than that which we had before the War, our system, of free imports, I most certainly prefer tariffs to licensing. That I have not the slightest doubt about. Such log-rolling as, goes on, and must go on—and the Government Departments cannot help it— makes it that the thing is festering with corruption, with secrecy, and with every thing that is undesirable. Tariffs would have to be dealt with by a House of Commons Committee, and that matter possibly fought out on the floor of this House. However undesirable that would be from my point of view, it is certainly preferable to any system of licensing. I do not wish to detain the Committee longer, but desire to put two or three points in connection with this interesting Debate for the initiation of which we are very much indebted to the hon. Gentleman below the Gangway.
Mr. T. SHAW: I rise with a certain amount of trepidation after the very eloquent speech of the hon. Gentleman the Member for Camlachie, who was so eloquent that he almost convinced me, although he turned the Front Opposition. Bench into a rock, and then made them

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stand upon themselves. He told us that before the War the City of London was the toll gatherer, that we had the riches of the earth, that we dominated the situation, but that in order to fill that position again we must change the system which we had before the War. I think the hon. Gentleman proved too much. When you prove too much, the result, I am afraid, will not bear calm investigation. I hope the Motion will not be passed. At the present time in Paris peace is being negotiated. We are hoping on these benches that either as an integral part of the peace settlement itself or by negotiations continued afterwards that an international arrangement will be made in regard to a minimum standard of comfort for the workers and a fiscal arrangement covering all the countries now negotiating. I suggest to the House that the peace terms themselves will have a very important bearing upon the fiscal policy of this country in future, and that it is extremely inadvisable for the Government at the present time to make a declaration that may influence the peace terms in a way not to the advantage of this country, its industry, and its commerce. I suggest, too, that there is a great danger of discontent among our Allies. I dare say it is quite natural that if the French are told that Australian burgundy must have preference over their burgundy they will not be pleased—to say the least of it, and the reaction may tend to do us more harm in the commercial world than any good we shall get from the preference we give.
On the general question, Protection, I am not at all carried away by the eloquence of the hon. Gentleman. There has been an artificial Protection during the War, and those of us who sit on these benches, and know what use was made of that artificial Protection by those who had goods to sell are not likely to be carried away by floods of eloquence. The facts are there. We have the experience of them, and "an ounce of fact is worth a ton of theory." We are told of the necessity for safeguarding our key industries. Yes, I do not think there is a voice on these benches that will be raised against that. But we say: "Safeguard your key industries in the proper way."
Brigadier-General CROFT: How?
Mr. SHAW: How? I will tell the hon. and gallant Member! Determine what it
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is absolutely necessary you should produce, and produce it as a nation. Do not give a vested interest to any body of producers by tariffs. Produce the things you absolutely need for yourself and take the benefit for the nation. I want to say that no sensible man will doubt that an increase of production is necessary if we are going to pay off our debts and become wealthier in future. But are we going to increase our production by setting up a method of taxation which helps the incompetent, the lazy, and those without initiative to exist? Or are we going to develop our resources by making people work and do their best? Note the contradiction. We are told that we need tariffs, because we cannot compete with Japan, which only pays Is. 6½d. per day. How are you going to compete against charges like that, we are asked. We need these tariffs, we are told, because of competition with America, which pays bigger wages than we do. What does it all mean? I ask myself as a plain man, do we need tariffs because of low wages or because of high wages? Evidently one or the other must be wrong, or the country is wrong from beginning to end. [HON. MEMBERS: "No, no!"] Let me now say a word about dumping. I am glad to have the definition of what dumping is. Dumping is selling goods in a country at a lower price than the cost of production in the country of their origin. That is not the definition of dumping given by the newspapers which generally represent the views of the hon. Gentlemen who seconded the Motion. We are told that it is dumping because Holland sends us baskets for fruit at a cheaper rate than we could get the raw material in this country, although no one alleges that these baskets are being sent here at a less price than Holland can produce them. I do not think, however, we shall quarrel, if this is the definition of dumping, about the solution. If goods are deliberately unloaded into this country at less than their cost of production in order to hamper our markets, then I for one will say keep them out absolutely, lock, stock, and barrel. Let us have no duties.
We were told that a certain very distinguished politician was an unrepentant Free Trader, and there are quite a lot of those on these benches. We are still unrepentant, because we feel that Tariff Reform, so-called, is the best method ever adopted for squeezing the consumer, and above all, the poorest people in the

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country. The Government are asked whether they are going over the top. If we have to go over the top, I suppose we may be shot, but we shall not run away on this issue. There has been an insinuation that we are in danger of losing our New Zealand trade to Japan, if we do not give her a Preference. I believe that to be an insult to the people of New Zealand, and I believe it is untrue. We have been told of the difficulties certain firms have had in making mill boards and leather boards. I do not know exactly where this kind of thing is going to end. The Resolution asks the Government to make a plain declaration on certain matters, but the speeches we have heard refer to quite other things. If we have to protect an industry like millboards and leather-boards, other industries will claim the same protection, and we shall have every industry being carried on in this way, with the result, which was not a very pleasant one, from which the system of Free Trade saved us many years ago.
I want to say a word or two about Japanese competition, and I want accurate data as to what these wages that are quoted mean. I have heard in my time a great number of statements about the textile industry, and personally I have conducted investigations on the Continent of Europe in order to find what prices were being paid, because of the statements made to me that we were being undersold by cheap German, Belgian, and Dutch labour. My finding was that in Belgium the workers were actually getting higher piece-rates than we were, that in Holland their piece-rates were also higher, and I also found that Germany's success was not due to her methods of manufacture, but to the methods of her merchants and her Consular system, and to the fact that by a careful study of foreign languages her merchants were able to enter markets that we might have entered with better articles; and she beat us, not because of our lack of manufacturing capacity, but on account of the German capacity for getting into the markets of the world and commercially beating us out of existence.
I know that some of the German methods were not above suspicion. I know how Germany went into Italy and how, through the Banco Commerciale, were actually able to use Italian money to finance German companies who were competing with Italian companies. It is for us to smarten our own methods and wake up to what has been
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going on. We want to develop our own Intelligence Department and train, our own men properly, so that they may enter foreign markets and sell our goods on the best possible terms to those who want to buy them. I have already referred to the inconsistencies of the argument with regard to low and high wages. In my opinion, the greatest danger to this country in competition with foreign countries is not the low-paid country, but the country in which wages are high, hours are low, standardisation has taken place, and organisation is absolutely of the most, perfect character.
One thing that could be done which would be of far greater service than any system of tariffs is for the employers to say frankly to the workpeople, "We do not mind what you earn if you will give us the maximum of production, and if you do we will guarantee that your wages shall not be reduced because of your efforts." I am speaking of what I know. I have in my own personal experience met case after case in which the increased production of a new article has meant the reduction of the rate of pay for the worker, and the worker has said, "What does it matter? If I produce more, it simply means that my rate of pay is reduced, and I will produce exactly the amount of my money and no more." The employer has proceeded on similar lines, and the worker in return has acted in the same way, and has given the employer as small an amount of labour for as big a wage as he could get. That kind of thing needs sweeping away, and it is of far more importance that that thing should go than any question of tariffs.
You can have what tariffs you like, but if you have inefficient production, neither protective tariff or anything else will carry you to the front as a progressive nation; but with the best feelings between employers and employed, with the best efforts of the operative, and with good wages, no amount of foreign tariffs can prevent you getting to the top of the scale. Therefore I suggest that our attention should be devoted to that side of the problem and to the commercial side, and then there is not a nation on the face of God's earth, America included, that can beat us. I know something of some of the trades in Germany. I have been in dozens of German commercial establishments, and German workshops, and I say unhesitatingly that my experience was that when it came to the actual production of the goods our

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men could beat the Germans, and at any time and place were able to hold their own.
I am aware that Germany had some specialities. I know the works at Stuttgart, and I know in the case of certain manufactures Germany came to the front, but this was the exception rather than the rule. The reason for this is not to be found in her superior methods of production but in her merchants, who were ahead of our own merchants and our methods, and which in some respects we ought to copy. If we have Tariff Reform, I believe we shall have set up in this country a number of vested interests that it will be exceedingly difficult to kill, once given life. I believe that Tariff Reform leads to incompetence, bolsters up in-efficiency, and bleeds the consumer. I only need to repeat what our experience has been in this respect during the War, when we have had a system of artificial Protection. We have seen the result of that, and we do not want any more of it. In conclusion, let me appeal to the House, whatever the opinion of hon. Members may be on the subject of Protection or Free Trade or with regard to dumping, not to pass this Motion at this time. Give the Peace Conference a chance. Let the delegates there see whether it be possible to build up a system of international arrangements as to hours of labour and conditions of work. Let them see if it be possible by mutual arrangements to agree so far as tariffs are concerned. Do not by a declaration to-night probably defeat the very object that we are seeking, namely, to live in peace and comfort with our neighbours, doing the best for ourselves and not injuring them in any way.
Major TRYON: I have been very much struck in this Debate by the very different feeling that prevails in the House compared with the old Debates that we used to have before the War when it was simply one party against another. We have had a very interesting speech from the hon. Member who has just addressed the House, and I need hardly say how much many of us on this side agree with all that he has said about the importance of increasing production and of encouraging the workmen to increase their production by giving them fair rewards for it and not cutting down payment for that production when it is increased. But he made other points. He told us that the success of Germany was
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due to her merchants, and then he told us that what he would do in this country would be to sweep away all the merchants and substitute State officials and Socialism. I never heard a more remarkable statement than that the whole of the success of Germany was due to German merchants coming from a Member of a party which proposes to sweep away the wonderful enterprise which has done so much to build up our trade. He told us that this German enterprise was the thing which made Germany, and he went on to say that under tariffs you got no enterprise. I wonder whether he is aware that Germany is a protected country and has been for many years! If tariffs mean, no enterprise, how is it that he finds enterprise in Germany? He says, also, that there is no invention under tariffs. Has he ever heard of the United States? Was there ever a country where there was more invention than in the United States?
Mr. JOHN JONES: And high wages!
10.0 P.M.
Major TRYON: I agree. The right hon. Gentleman the Member for Peebles (Sir D. Maclean) asked what President Wilson had to say. President Wilson said, "No sane democrat advocates Free Trade for the United States." I must apologise for replying to these debating points, but time is short, and we have had such an interesting Debate that I thought it better to reply to the points that have arisen than to make a general statement. Other points were suggested. We were told that we should get into trouble with our Ally France if we had tariffs. I wonder whether hon. Members who say that are aware that France is a country which has had a tariff against our goods which has in no way interfered with our friendship with her? Do they say that France will not tolerate our having a tariff, although we gladly agree that it is perfectly right for the French people to impose one? Are they aware that our relations with France were greatly improved when Cobden went back upon his earlier doctrine and arranged a commercial treaty with France not on the basis of Free Trade in this country and tariffs abroad, but on the basis of mutual concessions between us and France? That is what we work for. One of the vital questions that we must consider—and no man can tell the answer —is what is going to be the general policy of the world with regard to tariffs, Protection, and Free Trade? We here are not bound simply to work on party lines for anything. We are simply trying to see

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what is best, and it is very difficult to see any chance in the world of the future for Free Trade for this reason. We must remember that as self-government has been granted to our Colonies it has always been followed in the long run by the imposition of tariffs. We must remember that all great republics and all Labour parties who are trusted by the people to govern their country impose tariffs. Therefore, there does not seem very much chance of a Free Trade world. I frankly admit that there are great advantages in a Free Trade world. I do not deny it, but there are also great disadvantages of the smaller countries trying to set up new industries. All that we have to do is to consider what is right for us and our country. The right hon. Gentleman the Member for Peebles could see no difference between sugar made here and sugar made in our Dominions or sugar made in Germany. He said, in the colloquial expression, "It is just as much sugar wherever it is made." It is not just as much sugar when war breaks out, and you find that you are dependent for an essential food upon a production in Germany, not because it belongs to Germany but because it has been artificially created in that country. We have had a Debate which has been a great happiness to me, because of the friendly feeling with which we have approached the question. We have had an admission from the right hon. Gentleman the Member for Peebles to which I would respectfully call attention as of the greatest importance. It is that tariffs are far better than any system of licences. That is a great and very important admission. We cannot, in the world as it stands to-day, with fighting still going on in many countries in Europe, and with peace anything but in sight in the world, place the safety and liberty and absolute freedom of our country at the mercy of any other nation. We must be in a position to get all our essential supplies, our food or any production that is necessary, either for our maintenance or our defence. Therefore, in the interest of our liberty, apart from all economic questions, we must be self-supporting.
There is a proposal that a League of Nations should use the economic weapon to coerce some other nation. We have travelled a long way from the days when we were told that those who use the tariff only injure themselves. The weapon
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which we were told many years ago was so feeble that we ought not to use it lest we hurt ourselves is now admitted to be so powerful that we can coerce other nations with it. There are nations against which this power would have no weight. But let us free ourselves from being at the mercy of any country. Let us be independent commercially in our food, in our raw materials, and in our essential supplies, in case, which we pray may never happen, there may be another war. I have only intervened as one who has taken part in these Debates every year. I see new hope in this Debate, because we have had from the Labour party, from hon. Members opposite, and from all the House, an entirely different method of approaching this great and vital question. I would only say two things in conclusion. First, we must approach this question on the basis of the Empire, and not on the basis of these small Islands. Secondly—and I do urge this respectfully upon the Government— though there may be people who dislike Free Trade, and there are, and though there may be people who dislike tariffs, and there are, they all must unite in condemning any prolongation of a state of things under which we do not know whether we are going to have Free Trade or tariffs. We must settle the policy that we are going to have, and either policy will be better than this prolonged state of uncertainty.
Mr. BONAR LAW (Leader of the House): Listening to a Debate of this kind carries our memories back to a very different state of things from that which has prevailed during the last few years, and it is a Debate to which personally I have listened not only with great interest but with great pleasure. It is a subject which has always interested me, and I think I may say that before the War, I do not say as regards quality, but as regards quantity, I do not think there was any Member of the House who made so many speeches as I did in regard to it. I am therefore tempted to go into the subject on something of the old lines, but I shall entirely resist that temptation, or not entirely, but what I shall endeavour to do, with, perhaps, some references to the remarks which have been made, is to state as clearly as I can what the policy of the Government is and what our intentions are in regard to it. I listened with special interest to the speech of my right

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hon. Friend the Member for Peebles (Sir D. Maclean). Following the remarks of my hon. Friend below the Gangway, he came instantly to the conclusion that if he had to choose between them, a rock was better than a whirlpool. I am not quite sure. In the case of a whirlpool you either go through it or you go down. In the case of a rock, as the speech of my right hon. Friend shows, once you are sitting on it nothing on earth can move you from that position. But my right hon. Friend did really make a new departure. I understand that he represents the party of which for so long Mr. Asquith was the distinguished leader in this House. The speech he has made to-night is in the most absolute contradiction to the definite view which was taken, not only by Mr. Asquith, but by all his colleagues, at the time of the Paris Conference on economic subjects. My right hon. Friend, like another famous family, has learned nothing and forgotten nothing, but that was not true of those who preceded him on that bench. They had at least learned this, as the proceedings of the Paris Conference showed, that in a world where war is possible no nation can safely depend upon other nations for those things which are essential for the life of that nation. That is something to have learned. Then my hon. Friend who spoke last on that side (Mr. T. Shaw), in a speech, with much of which I agree, made two remarks which are worth noting. The first of these was that the whole future prosperity of this country depends upon the extent to which we can increase our production. With that I entirely agree, and it is from that basis that the whole efforts of the Government will be directed in framing a policy in the new conditions. He said also that one of the reasons which made him object to a tariff was that it would create vested interests. Perhaps that is true but the most vital of those vested interests is high wages, and I would ask my hon. Friends who sit on that bench—I am not now describing in the least what our policy is to be—to put to themselves this question: How is it possible to preserve a high scale of wages in this country if such conditions as were described by my hon. Friend who moved this motion prevail, and if, as I know is the case to-day, some cotton goods, the very goods for which he specially pleads, in small quantities, I admit, are coming in from Japan which are on sale in our
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market at a lower price than our manufacturers must pay for the cotton out of which these goods are to be manufactured? I put to them that question.
Now I will deal with the Resolution. It begins with a reference to Imperial Preference, and on that point, at least, there is no doubt, and has long been no doubt, as to what the policy of the Government is. In 1918, I think, it was definitely declared by His Majesty's present Government that we had adopted and would carry into effect the policy of Imperial Preference. That was known not only before the last election, but it was known more than a year earlier. There is no doubt, therefore, in anyone's mind that, so far as that particular question is concerned, the policy of His Majesty's Government is not in any doubt, and that it will be carried into effect at the earliest possible moment. With regard to that policy, I really was not only interested, but surprised to hear the kind of criticism directed against it by my right hon. Friend the Member for Peebles. It is an exact repetition of the arguments which were used at the Imperial Conference of 1907 by Mr. Asquith. He endeavoured to convince the Colonial Prime Ministers that Preference would be of no earthly use to them, and he made a very elaborate argument to that effect. I have not looked this up, but I think it was Mr. Deakin who said, in reply to Mr. Asquith, "That is surely a question for us." It is still a question for them. Shakespeare says:
"There is nothing either good or bad
But thinking makes it so."
If it were really of no use and our Dominions thought it was of use, it is worth giving for that reason alone. But it goes far beyond that. The assumption in all these arguments is that the conditions of trade are going to continue under a new system precisely as they are, as regards statistics, under the old system. Nothing can surely be more ridiculous than that. A Preference on these goods, on sugar, for instance, within the Empire is bound to have an enormous effect on the production of sugar through out the whole of the Empire, and it will entirely upset all your statistics. I think after the lessons of the War it is really ridiculous to say that it makes no difference to us whether we get the sugar from our own Empire or from abroad, or whether the trade which results from it is within our own Empire or abroad. Is there anyone who would maintain that

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now? Why, look at the history of this War. I think this country has throughout been very magnanimous in the way it has spoken of the exploits of our Colonial soldiers. I think we have spoken of them even more highly than we have praised the doings of our own men, and it is right for they were far away. They were not under the same compulsion which rested upon us to take part in this War. But making all allowances, when we realise how close, how doubtful the result was is it too much to say that we have no guarantee that we should have won the victory but for the help of our Dominion fellow-subjects? In view of that fact is there anyone who will be prepared to say that to whatever extent we can increase the productive power and manpower of the Dominions by our trading with them—by our Preference with them—that is not a good thing for Great Britain as well as for the Empire?
But it goes much further than that. My hon. Friend (Mr. Mackinder) pointed out that while in our old fights about the tariff we spoke of Protection as if it only applied to the imposition or some imposition of tariffs, it really does nothing of the kind. I am myself inclined to think that in the old controversy both sides were rather inclined to exaggerate the importance of the subject which they were advocating. It might operate in many other directions. Just think, for instance, what an addition—I am speaking now of the past—we could have made to the fighting forces of the Empire if there had been, not control, but some direction of the emigration which took place on such a tremendous scale before the War. Or take another aspect in which we might have given that preference before the War. Capital it a new country is vital. How easy it would have been for us, when London was the centre of the money market of the world, to give some slight preference in the borrowing of money in London to help to develop the Empire in some such way. All that kind of thing is involved in the effort to treat the Empire as one unit and we have done it in another way. In this system of licences which is now going on we have removed all restrictions within the Empire. That in itself is a preference of almost inestimable value to our Dominions, and we get value for it. I read to-night in an evening paper a short account of a debate in the Canadian Parliament. They were passing there a subject which interests Canada as well as the House of Commons,
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that Canada should get her full share of the indemnity and that it should cover the cost of the War. The acting Prime Minister of Canada, in dealing with that subject, said they could rely on the future, as in the past, upon Great Britain treating Canada not only justly but generously. That spirit, and the fostering of that spirit, is worth more than any fiscal policy.
As regards Preference, the position is quite plain. The policy of the Government has been and will be carried out. My right hon. Friend the Chancellor of the Exchequer is already considering in what way he will give effect to it in the forthcoming Budget. I noticed that the right hon. Gentleman (Sir D. Maclean)—I thought it very unfair to President Wilson—dragged him in, as if he had something to say about this policy of Imperial Preference. That is very unfair. The Republican party in the United States tried to make political capital out of what President Wilson had said about the League of Nations. The first thing he did was to tell them that nothing that he had said or meant implied in any way interference with the United States in its own fiscal policy. That fiscal policy includes Preference, and a very big preference given by the United States to some countries outside the Dominions of the United States.
Now we come to the general question. My hon. Friends would like very much that we should declare, quite distinctly and now, exactly what our policy is going to be. I can assure them, and I can assure the House, that there will be no hedging of any kind, and no hesitation in declaring that policy as soon as it is possible for us to decide in what form it will be carried out. The letter to which my right hon. Friend (Sir D. Maclean) referred, addressed by the Prime Minister to myself, made it quite plain what the general line of our policy is. That declaration will be carried out by the Government to the full, in the letter and in the spirit. But can anyone really suggest that it is possible to-day to say exactly in what form it will be carried out? Let me point out what is actually being done. As was explained by my right hon. Friend (Sir A. Geddes) the other day, the present policy of the Government is by a system of licences to restrict the imports of these goods into this country. I do not think—and I say this in all sincerity—that it raises in any way the fiscal controversy in its old form. The conditions

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to-day are absolutely abnormal, and you cannot at this moment deal with them by any definite system which will apply to normal conditions. I do not suppose there is any Member of this House—I am sure the Labour party would not—who would say that at this moment, when all our industries have been occupied in producing material for war, and are being gradually changed to a peace basis, we should allow unrestricted imports of the very things which these factories are being started to make, and allow them to be sent in by countries which have not had our suffering during the War, and are in a position to send them in to-day. I do not think any man in the House would think that reasonable. I submit that it is a very bad system and the sooner it can come to an end the better. We cannot deal with that to-day by a tariff, even supposing a tariff were a desirable thing. You cannot deal with these conditions by a tariff. There are certain classes of goods, mainly luxury goods, which would be bought at any price with any tariff, and these are the very classes of goods which our factories are being prepared to make, and for which the market would be taken away if the imports were allowed at the present time. In these conditions, I think it is a very desirable thing, when we have time to look around, to go fully into this problem and to decide, not in a hurry, not in excitement, but after careful and complete examination, which is the best permanent system for this country. That does not mean that we are neglecting the subject now. As a matter of fact, one definite part of the undertaking given at the time of the election is being fulfilled. We definitely promised that there would be anti-dumping legislation. A Bill on that subject has been carefully considered, and a Bill is already in trim, though we have not had time to consider it, and I myself have not had time to examine it. So far as that subject goes it is being dealt with. But, of course, there is far more than that involved.
My right hon. Friend spoke of two things—of key industries and of keeping up production in this country. That is what we have got to do. That is the aim which we have set before us. We have not decided what is the best way to do it, and I say to my hon. Friends who agree with me on this question, as I say to the others, we have got to deal with this question
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quite apart from our old prejudices. We have not got to go into it, and I am not going into it, with the idea of saying to my right hon. Friend that a tariff is the only way. We have got to treat it as we have treated every war problem—that is, to see what is the object at which we are aiming and then to try to discover what is the best means of carrying out that object. That is our policy. It cannot wait for ever, and already the Department has been engaged in trying to formulate a scheme which will be the best way of carrying out the policy which the Prime Minister put before the country. But it is all very well to talk about our not dealing with the thing right away. We cannot do it. I do not know whether the House fully understands what the pressure on the Government is at this moment. From the nature of things that pressure must be great, because through no fault of ours the Government is in effect divided. One half is in Paris and one half is in London. Nor am I complaining, but it is an indication of what the position is when I say that though for the last three months I have been free from the responsibility of a great Department, yet at no time during the War has the pressure upon me, and I am sure upon all my colleagues, been so great as in these three months. It is not too much to say that in the circumstances we have a right to ask that the House, whatever its views, should recognise the facts and realise that there is no unnecessary delay, and that we are doing our best.
But, in addition to that, I confess that I am not at all sure that the delay is all to the bad. Perhaps we all need a little education still. I learned to-day from my right hon. Friend the President of the Board of Trade that he had a deputation from a particular industry, that the deputation consisted both of employers and workers, and that the deputation came to complain of the limited imports which we were allowing into this country. The Labour side of the deputation spoke very frankly to my right hon. Friend. They said, "If the Government do not deal with it we will deal with it ourselves, and find a method of seeing that these goods are not transported direct and dealt with in this country, if you insist on letting them in." One thing I am certain of is that owing to the War, and the conditions of the War, there is an absence of expansion of trade. There is, I am sorry to say, growing unemployment. As long as that takes place

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I, personally, am absolutely convinced that more and more the feeling will grow up among the working classes in this country that, if we are to maintain and, perhaps, improve the present level of wages, we must have more security than we have had in the past in our own home markets.
That is my position, but I quite admit that everything that was said by my hon. Friends about the need of a definite policy is true. It is quite true that our manufacturers are in a position of great uncertainty. That is not altogether due to the question of what the fiscal policy is, perhaps it is comparatively little so. Everyone knows what the other conditions are, the uncertainty as to the prices of raw materials, the uncertainty as to the level of prices, everything of that kind. I was going to say I was glad to mention—but that would not be the right way to put it—I can tell the House that those conditions are affecting other countries, including the United States, to a very large extent at present. But, undoubtedly, if people could know exactly what our fiscal system is going to be it would be of great value to everyone, and it is clearly the duty of the Government to come to a decision and announce it at the earliest possible moment. We do not in the least intend to wait until September before we announce that policy, but we do intend to make as certain as we can that it is the best policy, that it has been thoroughly thought out, and that it is something on which the Government as a whole is prepared to come to this House and ask for the support of the policy we lay down. That is all I have got to say on the subject to-night. I hope I have not spoken too much in the line of my old speeches, at all events I did not mean it. I recognise—I have not in the least changed my views—but I recognise that the War has altered everything, and that the Government which has now secured the confidence of the country is a Government which represents very different views on these questions, and what I mean to do is to try to get, without trying to force my views or the views of my Friends on those who do not agree with us, the best policy we can in the existing conditions which prevail.
Mr. ACLAND: This has been an interesting Debate up to now with a high level of speeches which I shall do my best to maintain. But I think it has been a little
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disappointing in one way, because the supporters of the Motion have not really dealt with the Motion itself. The right hon. Gentleman who has just replied for the Government, in a most interesting and able manner, refrained from adding anything to what he had said before. I think the most interesting thing about his speech, if I may say so, was the almost total silence in which it was received by those who had moved and supported the Motion. When my right hon. Friend (Sir D. Maclean) was discussing the question as to there being a tariff or prohibition, he made it quite clear that he was prepared, if he had to choose between the two, to suffer from a tariff; but the point he was making, and those who work with him intend to go on making, is this, that we for our part do not intend, if we can help it, to have either a system of prohibition or a system of tariffs. We regard them both as being evil, and we do not intend to let ourselves be put in the position of having to choose between two things which we regard as almost equally bad. I would like to devote the few words, I have to say to commenting on the Motion as it is on the Order Paper, from one point of view expressed by the right hon. Gentleman, and with which I am sure we all agree, that what is supremely necessary to this country now, and for the next few years, is the greatest possible increase in production. Until we can revive our producing capacity, we are very greatly in danger of drifting into national bankruptcy, and I entirely agree with him that that is the thing we must have in our minds first, foremost, and all the time.
There are three subjects dealt with in the Motion—key industries, dumping, and Imperial Preference. With regard to key industries, I do not intend to say much, because that is a matter which, more or less, we have been discussing two or three times lately. Only one quite interesting thing has happened since our last Debate, and that is the resignation by Lord Emmott of his chairmanship of that Committee which was dealing with certain matters of imports and exports and their restriction. That has, I am bound to say, justified altogether the fears which I and some of my Friends ventured to put before the House when we were dealing with this matter before, namely, that the question in its working out by the Subcommittees in charge of the different groups of subjects would, as Lord Emmott said, be dealt with too predomi-

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nantly by an element directly interested in the trades concerned in a way which he, as an honest and impartial man wanting to keep apart from all that sort of atmosphere of pulls, in favour of this industry or in favour of that set of manufacturers, could not stand, and therefore he has resigned his position. That is the sort of thing, hinted at two or three times in this Debate, you are bound to get into if you are going to proceed on the basis of selecting certain industries for more or less limited prohibition. The only way—I for one certainly am not and I do not think any of those with whom I work on this Bench are against it—is for the Government to bring down to the House as soon as possible a list of those industries which they really regard as essential key industries. When they do that, I do not think there will be any absolute refusal to consider anything as a result of the War. The War, of course, has changed a great many things, and if certain industries are selected as those which the Government thinks must receive, for the future, special treatment, I believe they will find everybody in the House prepared to consider their list. The only thing we shall fear is that however careful any set of persons may be in trying to say what our key industries are at present, it is only too likely, when the next emergency arises—if ever an emergency does arise—that we shall find it is quite a different set of industries from those we have carefully tended and conserved at the present time, and therefore what we can do in advance will not, in all probability, be very much good. That does not acquit us from having to apply our minds to it when the Government can bring down a definite set of industries and declare that all other industries are absolutely free from restrictions. There is this second condition, which has also been pointed out from these benches, that when that list of key industries is brought before us by the Government for discussion, it is absolutely essential that some machinery should be suggested for keeping those industries under the very strictest national control, and securing that the profits for carrying them on should come to the nation, and not go to any sets of private and interested individuals. We have said that kind of thing before. We shall go on saying it again. [HON. MEMBERS: "Hear, hear!"] At any rate, I am devoting my speech to the
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Motion, and that is what some hon. Members who have taken part in the Debate did not do. Being invited by the Motion to go into the question of key industries, I have ventured to go into that question, and to set, even at this late hour, a precedent in that respect.
Then there is the question of dumping. I noticed that when my right hon. Friend talked about the possibility that we in this country might be willing in future to take sugar even from Germany there were loud derisive cheers in a certain quarter of the House, and when he proceeded to ask how else Germany could possibly be expected to pay the indemnity there was, if I may say so, a loud silence in the same quarter. Absolutely no reply has ever been suggested to that question. At the last Election when I was asked if I were in favour of making Germany pay I said, "Yes," but I also proceeded myself to ask another question—"How?" There is no answer to that except that it can only be by letting Germany send us her goods or allowing her to render us certain services such as shipping and insurance. I shall be perfectly prepared to look forward—and I shall do so with some pleasure—to see how in fact we actually do get paid the expenses of the War which the vast majority of people of this country were led by the Government to expect would be paid if we exclude taking German goods or letting Germany do service for our benefit. I am quite content to wait and see how that works out.
Then I come to the question of Preference. I think my right hon. Friend opposite was quite fair when he said he was going to keep away from the old controversy. I think he did, but still his speech in many ways reminded me of old times. It reminded me of the days when the Foreign Secretary used to deal with fiscal questions and get up and make speeches quite as clever and quite as interesting as that which the right hon. Gentleman made to-night, but which, like his, did not carry his own supporters any further towards Preference, which was after all what they were in pursuit of. It was rather like that to-night, because when my right hon. Friend spoke so eloquently of all we could do in the direction of Preference for our Dominions by directing capital in ways which would assist them in doing certain other things I am quite certain that what was

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in their minds was, "Thank you for nothing. We knew all that before, but we want something vastly different from that." That is so, of course. When they are talking about Preference they want a regular system of tariffs right through to be set up. As long as the Government maintain just the same attitude as they have hitherto adopted I do not know that we have much to complain of. We shall judge when the matter is definitely before this House. They have said precious little so far. They have said that they intend to give a Preference on Duties already imposed or that may be imposed, and they also state that nothing whatever will be done which can possibly increase the price of food; therefore sugar is not entirely ruled out.
Mr. BONAR LAW: We definitely stated that our undertaking on duties now imposed applied to sugar. A preference will be given.
Mr. ACLAND: Sugar is surely a food. I remember a very definite statement which entirely precludes the Government from doing anything which either directly or indirectly will increase the price of the food of the people.
Mr. BONAR LAW: My right hon. Friend is surely forgetting that the party of which he is a member always taxed the very commodity to which he is referring.
Mr. ACLAND: It has been frequently pointed out that an all-round duty for revenue purposes is one thing, while a preferential duty, which is supposed to give particular persons a particular advantage in prices is a perfectly different thing. I feel sure if you are going to say, "We will put on sugar or on tea an all-round duty for revenue purposes, of which the whole yield goes into the Exchequer," that is one of the ways in which this country has always consented to pay its taxes, but if in connection with the fiscal question you have made the statement that you are not going to touch food in the sense of preferential or Protectionist duties, it seems to me it is very difficult to carry that out in the direction of putting preferential duties on sugar or tea or things like that. However, we shall see. The point I want to make is that the right hon. Gentleman, to my relief, did not go an inch beyond what the Government had frequently said before, and, I am afraid, very much disappointed those who brought forward this Motion. I do not wonder the Government
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hesitates. There is a great deal about which to hesitate. It is a dreadful thing to contemplate what hon. Members who move this Motion do contemplate with the utmost cheerfulness, namely, beginning our new relations with our new Allies by putting on duties against the goods they send out. [An HON. MEMBER: "They do to ours."] That is all very well, but we have settled down to a system with them which to our considerable advantage in the past, has not admitted of duties being put on against their goods, and we shall see when it comes. I think it will be a considerable gain to the group with which I work that when we really do begin for the first time to put on duties against Belgian exports, and French exports, and Italian exports, there will be considerable difficulty and considerable friction, and I do not wonder at all that the Government hesitates before announcing a policy of that kind.
With regard to the Dominions, of course there is this fact you cannot get away from, namely, that there is no really effective demand that we should set up that system of tariffs, beginning with Preference, which the Movers of this Motion have in mind. The Dominions before the War were perfectly content that we should do what was best suited to our own system, and that has always been admitted by their great leaders. My right hon. Friend quoted one of them in his speech to-night in backing up what he said about Preference, and the best quotation he could find was this, that the Prime Minister of Canada had said that he could rely on Great Britain ever doing in the future, as in the past, what was best for the industries and so on of Canada. There was no complaint that we had not in the past pursued a policy which was perfectly consonant with, the best interests of Canada's industries. Surely, if this War has proved anything, it is this, that the best foundation for Imperial solidarity is sentiment, and is not tariff bonds or trade arrangements or bargains. At once when you start that you get difficulties. You get South Africa wondering whether they are not being worse treated than New Zealand, or Canada wondering whether they have not been unfairly treated compared with Australia. So long as you go on the basis that, for good reasons connected with our industries and our people, it is necessary for us to avoid an enormous system of tariffs, that is understood by every man in the Dominions

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who knows our conditions here at all, and there is no heart-burning, no jealousy, no squabbles, as to who shall get most. The effect of such a system as is advocated here—though they will never come to close grips—a system of Preference as the basis of your tariffs, going up in steps—a moderate duty against the Dominions, a heavier duty against our Allies, a heavier duty against neutrals, and a still heavier duty against other countries. It is a four-decker tariff they are really advocating.
I want to touch on the effect of that on the export trade, on the restoration of which the prosperity of this country depends more than anything else. We have had, owing to natural conditions, owing to the industry of our people, owing to our geographical situation, without any tariffs at all, because we had no tariffs at all, the most unexampled position of favour with regard both to our imports and our exports in the pre-war period. There has never been a country in which at the same time so large a proportion of what we imported consisted of food and raw material, and so large a proportion of what we exported consisted of manufactured goods. That has been the concomitant—I do not say that that was necessarily the result, but it was the concomitant—of our system of free imports. That has a bearing on the question of exports. If you embark on this question of a tariff based on Imperial Preference it is a thing that will take years to work out. It might very well take three Sessions before it was finally accomplished, even if you had no crowd of great questions bearing upon you as now, owing to its vast complications and tremendous difficulties. For, during all that time, there would be doubt when there should be certainty. There would be a want of confidence, when there ought to be confidence, as to what would be the future of the country, at the very time when those engaged in building up our export trade again ought to be as certain as possible as to what the future has in store. If you are going to be committed, as this Resolution, if carried, would commit you to building up an enormous tariff machine, it must affect every export business in thousands of ways. Hon. Members who lightly contemplate the setting up of a great tariff as a thing to be done in an odd fortnight of the Session, or something of that kind, do not realise in the least how that must affect every great
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exporting industry in this country. We obtain the greatest portion of what we import in the form of raw materials or semi-manufactured articles needed for this great export trade. The only way to build up the confidence which our industries need more than anything else is by freeing them from the prospect of the great edifice of a tariff put on all sorts of things which affect their trade. Remember that half our trade is export trade, and we cannot maintain a population half as great as that which we now maintain unless that export trade is restored. Finally, I say once again that the only way to restore confidence in that great export trade on which we must depend if we are to be saved from the bankruptcy to which we seem to be rapidly tending owing to the heinously inflated Estimates that the Government have this year put before the country—we shall not have a Budget, but a Loan. It will simply be a proposal for raising hundreds of millions more pounds in Loan in this country, with practically nothing, compared to the expenditure, forthcoming on the side of taxation. That way lies bankruptcy—the only way to avoid it is by restoring our export trade to the fullest possible degree. So long as our export trade is threatened by the regulation tariff which the proposers of this Motion have in mind, the confidence which is essential cannot possibly be restored.
Brigadier-General CROFT: I cannot think it is necessary to reply at length to the right hon. Gentleman. Mr. Joseph Chamberlain and Mr. Disraeli answered his speech a very long time ago, and he appears to have learned very little from the experience of the War. I am sorry, almost, that not one of his colleagues who was associated with the Paris Resolutions is in the House at the present time to have pulled his coat-tails and reminded him of the pledges of the Liberal Leaders outside. I would like to say one word on the speech of the Leader of the House. He pleased everybody in the House when he told us that the Government were going forward with their policy of Imperial Preference, although some of us regard it is a very small measure within that limited scope. Everyone who has been keen on this question in the past will realise that if it is a small thing as a financial gain to the Dominions, it is a great thing to show the Dominions and the Colonies that so far the spirit is willing for a greater development of our inter-Imperial trade in view of the common sacrifices of the

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peoples of the British Empire. In regard to the main tariff policy of the Government many business men will think that it is deplorable that the right hon. Gentleman had to tell us that the Government had not made up their mind as to their policy. The Tariff Resolutions were introduced, I think, in the summer of 1916. Mr. Asquith and his colleagues were very emphatic, not only as to the wisdom of that policy, but as to the extreme urgency of carrying it into effect forthwith. Yet while His Majesty's Government have promised from time to time that we were going to have a definite statement of the policy of the Government, we find even once more to-day they are unable to give this House any very definite lines on which to go. The right hon. Gentleman himself, one would have thought, must have made up his mind, because, in the days gone by, there has been no more profound student of the questions involved than himself. But the real trouble, I think, is that the Govern-itself has not really made up its mind as to what are its main principles of policy. One heard of a letter written to the Unionist party, thoroughly converted, that the Government were to have a real economic policy. We have to remember, too, that the Secretary for War went down to his constituents with a clear conscience because he was joining a Free Trade Government! The same difficulty is puzzling the minds of business men of this country. No single business man, no single agriculturist, knows for a moment where he is. We quite understand the pressure of work on His Majesty's Government in regard to all these questions. But surely the whole of the Government are not responsible: surely some of its members might, during these four long years, have been in a position to get a policy ready for which the sanction of the Prime Minister could have been obtained!
One word in regard to the right hon. Gentleman the Member for Peebles. We have had all the big guns of the Opposition Bench here to-day, and their most powerful arguments have been brought to bear. What the House will note with extreme interest was that the right hon Gentleman, the leader of the official Liberal party told us that we must have cheap sugar! The indication was very clear that so far as he was concerned, he was determined that that sugar should come from Germany or Austria-Hungary if it was cheaper than in this country. It is well
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that the country should know that this miserable remnant throws stones at another party in the State owing to its smallness, oblivious apparently of the fact that 100 per cent. of those that went to the poll under its ægis were returned, whilst the party to which the stone-throwers belong came back differently to what they went out! Thousands of people in this country demand that the Government shall, at the very earliest possible moment, tell them where they stand; otherwise they can make no plans, and you will not get real confidence in the industry of this country.
Mr. FRANCE: The Leader of the House did not deny, but rather, I think, defended with some difficulty, what I should have thought was the giddy occupation of not trying to go down in a whirlpool! Although he said that everything had changed during the War with regard to the attitude on this subject, he also denied that his own views have changed. We shall be grateful to him, having pointed out that it will be unwise to proceed at once, and in a hurried fashion, to try and decide our whole future policy of this country, that he told us that the Departments were at present considering how best to carry out a temporary policy. We heard the other day that that policy was to be reviewed in September. We were told to-night that the decision would be given before December—
It being Eleven of the Clock, the Debate stood adjourned.

INCREASE OF RENT BILL.
To be communicated to the Lords.—[Mr Fisher.]
The remaining Orders were read, and postponed.

RUSSIA.
Whereupon Mr. SPEAKER, pursuant to the Order of the House of the 12th February, proposed the Question, "That this House do now adjourn."
Colonel GRETTON: The whole country at the present moment is in a state of great

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anxiety as to the progress of affairs in Russia. The information which we have through the Press is meagre, and, in the opinion of most people who have studied these questions, is very unreliable. A very large proportion of the information published comes through those sources and centres which, during the progress of the War, have been devoted to the dissemination of German views and propaganda. I desire to remind the Government that there has lately been very serious fighting in the North of Russia. Apparently the Russian Bolshevist Army, organised by German officers, has been attacking the Allied Forces occupying the districts in the neighbourhood of the White Sea. Very alarming rumours have been published as to the position of affairs in Odessa, and it has been stated that the Bolshevist Armies have advanced close to Odessa, and have delivered attacks upon the Allied Forces in occupation of that place, and consequently great anxiety has been caused in that connection. We have seen in the last few hours statements in the Press, of which we have no means of judging as to their reliability, that the Bolshevist Army have joined the Hungarian Army and are causing disturbances there. We know that there has been serious fighting with a more successful result in Esthonia and Lithuania. All these events are most disturbing to the attempts now being made to establish peace in Europe.
We have no information, and it is very much to be desired that we should have some, as to the progress of affairs in Siberia. We know that Allied Forces have been landed in Siberia, and have been operating a considerable distance from Vladivostock. As to whether they have been continued or not we have no reliable information. I think the time has come when the Government should give us such information on all these subjects as they are able to do without detriment to the general cause of the Allies and in the public interest. Information is also most ardently desired as to what is the policy of the Government in dealing with affairs in Russia. Clearly the Allies and the Government of this country cannot fail to be more deeply interested in what is passing in that unhappy country. There is what is called the Bolshevik Government, and there is clearly great resistance to the Government. It is not a popular Government— at any rate, it is not supported by a very
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large number of people in Russia. The most appalling crimes have resulted from the efforts of the Bolsheviks to establish their rule over the whole of Russia. Owing to the cessation of hostilities in Europe and the opening of the seas, the position has been very considerably changed. The Allies now have access to the Baltic, if they choose to use it. They have access to Petrograd, which at one time was not the case. I would ask whether the Government of this country and the Allies have surveyed the present situation in the light of the change which has been brought about by the cessation of hostilities in Western Europe, and if they are prepared to support in Russia those forces which are making for the establishment of an orderly Government? The Bolshevik Government is clearly a danger to the whole world. The present condition of affairs in Russia cannot be allowed to go on indefinitely. One of the greatest problems before the Allies is to determine the steps that they shall take to bring to a speedy end the disorder and appalling events now prevalent in Russia. I desire, therefore, to ask the Government if they can give us some information on these questions, which are exercising the minds of the people of this country to a very great extent.
Mr. CHURCHILL: It is a very large topic to open up at this very late hour of the night, and if my hon. and gallant Friend were to persist in his request that I should enter upon the grave and general question of policy to which he has referred—a question which undoubtedly stands in order of prime importance so far as our affairs on the Continent of Europe are concerned—I should certainly feel it my duty to decline to open up that topic at such an hour, and in a Debate necessarily so limited. When my hon. and gallant Friend asks for information about the actual operations on the different fronts where fighting is in progress on the vast frontiers of Russia, I am quite ready to supplement to some extent what I said to the House in introducing the Army Estimates. If we take the different theatres in order, we begin with the far north, Murmansk and Archangel. There my hon. and gallant Friend said that the situation was very serious, and that serious fighting had taken place. That is not so. Very little fighting has been taking place, and, as I mentioned at Question Time to-day, the number killed at Archangel since the beginning of this year has been less than

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one in 300 of the troops employed, and in Murmansk less than one in 500 of the troops employed. These are figures which compare, I believe, favourably with the death rate which we are experiencing here during the influenza epidemic. I do not think a hundred persons have been killed. On the other hand, the war is of a very sombre character. The natural conditions are very cruel and hard on the troops. The whole country is bedded in snow of great depth, sometimes thawed, sometimes frozen, intersected by streams and lakes subject to climatic changes which greatly affect the actual position. From this wilderness of snow arise dark pine forests, and in these forests are blockhouses which, linked together and joined on tactical principles, enable us to hold an immense front with the greatest possible economy of force. These blockhouses, placed in these woods, and protected by wire operate by means of radial lines cut through the woods to enable the fire of their machine guns to be brought, now in this direction, now in that, with other posts in the rear of machine-guns in case the front line should be attacked. I was reading an account the other day from a general there of an attack which he saw by the Bolsheviks about six weeks ago. There were about 1,500 of them, and they came on extremely well to attack a group of our blockhouses posted in these woods. They all were white sheets, a device which was sometimes used on the Western Front in winter time, and carried great pine branches to make their actual figures very vague. As they advanced they lost about twenty from the fire of our block-houses, but that did not prevent them coming on and smashing in the doors of two of the blockhouses and killing the occupants, but they were subsequently repulsed and driven out by the fire of the machine guns echeloned back in the rear, and the general, who had the opportunity of going over the field a few hours after the fight, counted 220 Bolshevik bodies on the ground, our losses being fifteen killed. I must explain that in that country any wounded man falling on the ground is frozen stiff in a few hours or less. Another feature of the War there, of course, is the accommodation. You cannot live out of doors for any prolonged period, and, therefore, if a farmhouse or village is shelled by distant guns and destroyed the accommodation is damaged, and the troops
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holding it, who may have waited outside while the shelling was going on, have to go back four or five miles until other accommodation is found. There is, therefore, a warfare on each side of destroying the accommodation of the troops. Lastly, there is the question of the river Dvina, on the upper reaches of where the Bolsheviks have a considerable number of ships, some of them armed. It will be possible for the enemy to advance with their ships along the valley of the Dvina and to attack our men when the thaw begins and naturally these are circumstances which are very well known to both sides and have been very carefully considered by the War Office. The dispositions which we are making in this theatre are very simple. We are preparing for whatever policy is decided upon. We are holding the necessary forces and means of succour to proceed to the assistance of our troops there if circumstances should render it necessary to reinforce or to extricate or rescue them. But no movements are possible in the present state of the ice in the White Sea. The dispositions we are making leave it absolutely open. I need not say that, whatever our policy, it could not be announced in public, and whatever course we adopted we could only proceed to see that rumours and reports of a very mystifying character would get about, so that the enemy should be left in complete uncertainty as to what the strategic policy of the troops in that quarter should be. However, broadly speaking and judged by Western Front standards, there is really no fighting going on except occasional raids about the magnitude of trench raids, and the casualties have really not amounted to what have often been the losses of a single battalion in comparatively quiet times on the Western Front.
Coming a little farther round the circle, we get to Esthonia, Lithuania, and those small States which have appealed to the League of Nations for protection against the Bolsheviks and have been promised protection and recognition in various forms and on various dates. The Esthonians, to some extent supplied with British arms, have made a very stout fight and have really shown the weakness of the Bolshevists for quite small forces have been driven back, the Esthonians being stout-hearted and having fought well. There is also in this region a German force of considerable size, which, under General Von der Goltz,

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has been moving forward slowly towards Windau, and will eventually move towards Riga. This force is no doubt somewhat increasing German influence in this district, which is a disadvantage. On the other hand, it has saved it from being ravished by the appalling misery and desolation which would be their lot if the Bolshevik terror overran them. Therefore we are not obstructing any longer the operations of this force, which is, in fact, rendering useful service from some points of view in this theatre of war.
Coming further South we have Poland, Hungary and Roumania. That area has recently given cause for anxiety, but I have no official confirmation of the invited invasion of Hungary by a Bolshevik army up to the present. It is clear that Poland, with Germany behind it, which is in a very anarchic condition, and with a Bolshevik army advancing upon it from the East, and with its own organisation in a most primitive condition, with great food troubles and great political embarrassment is in a very weak and anxious position, and might easily degenerate under the combined pressure of Bolshevik propaganda and Bolshevik attack. Hungary has clearly undergone a very serious and considerable political change, and shown a disposition to resist the will of the Allies while putting on the garb of Bolshevism. The position in Roumania is also anxious because that country has suffered terribly in the War. They are very short not only of food but of all the means of equipping their Armies. Locomotives have been carried off and not restored, and other locomotives are not suitable to burn oil, which is the only fuel now available, and their position is one of difficulty, but I hope and trust energetic efforts will be made to succour Roumania, which becomes the great buttress of our fortunes in that part of the world against the advancing tide of Bolshevik anarchy and terror. Still further south, on the Black Sea littoral, we have the Ukraine, which has not yet fully experienced the joy of Bolshevik rule, and therefore the people are to some extent under the first influence of the disease. The doctrines of Bolshevism make a certain appeal, and the Bolshevik Armies, profiting by the fact that the German troops were rapidly withdrawn after the Armistice and that no other ordered force took their place, advanced rapidly and overrran the whole of the Ukraine,
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gaining this fertile and rich food-area and thereby obtaining the means of prolonging their life. They destroy wherever they exist, but by rolling forward into fertile areas, like the vampire which sucks the blood from his victim, they gain means of prolonging their own baleful existence. In the Ukraine the experience of the last two or three months has been very disastrous. The French and the Greeks, who had entered from the South and gone some distance from the coast, have been confronted not only with the attack of considerable forces but by a considerable movement of the population, which is not only of the people in the towns. This movement was hostile to the French and the Greeks and is a factor which must be very carefully weighed by everyone who studies this problem, because it shows the danger of rash interference or meddling which would enable the Bolsheviks to rally to themselves perhaps even a patriotic and national movement. The actual situation there is that two towns have been taken, and the city of Odessa is being defended. I suppose it will gradually go through the process with which we are familiar on the Western Front where towns slowly melted away under the fire of artillery. At present the French, Greeks, and Russians are holding Odessa against the Bolshevik attack. It is clear that the Bolshevik Army near Odessa and along the east of the river exposes Roumania to very direct menace of invasion which, coupled with the position in Hungary, renders the Roumanian problem especially acute. In Nicolaieff, which is one of the towns occupied, a curious situation has arisen. There were about 10,000 Germans who wished to be taken home by sea, and this being refused they endeavoured to make their way by land and they were attacked by Bolsheviks. They threw themselves into Nicolaieff and defended themselves with some success. It is possible some use might have been made of these men, but owing to the way in which this question was handled they have now finally given up their arms, and some have gone over to the Bolsheviks and the others have been brought out by sea. So much for an area which is extremely unsatisfactory. The march of events there has been wholly prejudicial to the cause and the hopes of permanent peace in Europe. Then we come to the Army of General Denikin, to which we are giving support. That Army rests

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from the Don practically to the Caspian Sea. It is the best of the Russian Armies. It is made up of volunteers who have gathered themselves together and are fighting desperately for the honour and integrity of their native land and for the cause of civilisation not only in Russia, but all over the world.
Our policy in regard to that Army is not to involve any British troops at all. We are not sending any British troops at all up to the present, but we are sending a Mission. We have a Mission there which we have supplied with ample supplies of munitions of war of all kinds. Those supplies are well on the road, and those troops have not lacked anything we were responsible for providing them with. We also assist it with instructors and technical advisers in regard to the supply of complicated war material. General Denikin's Army has sustained a heavy reverse on its left flank in the advance of the Bolshevik attack, though the main recent attack has gone more to the west, falling more on the French and Greeks, and, as I told the House in introducing the Army Estimates, he has gained considerable success by striking towards the Caspian, taking more than 30,000 prisoners in a series of sweeping operations. The British Fleet still remains in command of the Caspian Sea, but there is a Bolshevik Fleet little inferior in strength, which is in Astrakan at present, imprisoned by the ice which blocks the northern portion of that sea at this season of the year. Beyond that, of course, we have smaller detachments of troops which are in the Trans-Caspian area, stretching towards the distant frontiers of India, without any serious operation of any kind except skirmishing with Bolshevik patrols and preventing their advance towards the disturbed borders of our Indian Empire. Lastly, there is Admiral Koltchak and the Siberian Army. These Russian armies have been lately conducting an offensive
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as far as possible and they have regained Ufa and a great many prisoners have been taken, and it is not too unduly sanguine to say that the offensive just begun has opened auspiciously, at any rate in the northern sector.
In the Southern sector matters have not gone so well. We have there only a small force. We have a Mission there to assist Admiral Koltchak, and there is only a handful of men who are in command of Colonel John Ward. These men are not in direct contact with the enemy. They are a great many miles from where fighting is going on. They are in the City of Omsk, where they remain as a sort of symbol and guarantee of the authority and reputation of Admiral Koltschak's Government—the Siberian Government. They are extremely valuable from that point of view—they are a symbol that he is being assisted by the Allies and by Great Britain.
We have not failed in our task of supplying Admiral Koltchak's troops with arms. Over the whole 5,000 miles of Siberian railway we have transported a very large number of rifles and a certain proportion of guns and ammunition. It is intended to continue this support, and to add technical instructors and experts in the more complicated material of war to assist Admiral Koltchak in the same way as we are assisting General Denikin. I have now gone round the circumference of the Russian Empire, and explained the position at the present time, and I think that my hon. Friend will see that if for no other reason than the lateness of the hour, it is impossible to touch on the general question of policy, which I know he has got so largely in his mind.
It being half-past Eleven of the clock, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing. Order.
Adjourned at Half after Eleven o'clock.

  SPENDING DEPARTMENTS.
  SPENDING DEPARTMENTS.
FOOD SUPPLIES.
  FRUIT (SPECULATIVE BUYING).
  FRUIT (SPECULATIVE BUYING).
  MARGARINE.
  MARGARINE.
  OIL AND FATS DEPARTMENT.
  OIL AND FATS DEPARTMENT.
  BASKETS (IMPORTATION).
  BASKETS (IMPORTATION).
  WELFARE OF THE BLIND (COMMITTEE'S RECOMMENDATIONS).
  WELFARE OF THE BLIND (COMMITTEE'S RECOMMENDATIONS).
DEMOBILISATION.
  WIRELESS OPERATOR.
  WIRELESS OPERATOR.
  ROYAL ARMY MEDICAL CORPS.
  ROYAL ARMY MEDICAL CORPS.
  APPLICATIONS FOR RELEASE.
  APPLICATIONS FOR RELEASE.
  TROOPS IN EAST AFRICA.
  TROOPS IN EAST AFRICA.
  BATTLEFIELDS (PRESERVATION).
  BATTLEFIELDS (PRESERVATION).
  NORTHERN RUSSIA (MILITARY OPERATIONS).
  NORTHERN RUSSIA (MILITARY OPERATIONS).
  SERBIAN ARMY (BRITISH MECHANICAL TRANSPORT.
  SERBIAN ARMY (BRITISH MECHANICAL TRANSPORT.
  CANTEEN MANAGER (DISMISSAL).
  CANTEEN MANAGER (DISMISSAL).
  MILITARY HUTS (DISPOSAL).
  MILITARY HUTS (DISPOSAL).
NAVAL AND MILITARY PENSIONS AND GRANTS.
  REMARRIED MOTHERS.
  REMARRIED MOTHERS.
  ROYAL ENGINEERS (K COMPANY).
  ROYAL ENGINEERS (K COMPANY).
  DEMOBILISED MINE-SWEEPERS.
  DEMOBILISED MINE-SWEEPERS.
  DEPENDANTS' ALLOWANCE (MRS. TIMBS).
  DEPENDANTS' ALLOWANCE (MRS. TIMBS).
  CONSTANTINOPLE (ST. SOPHIA CHURCH).
  CONSTANTINOPLE (ST. SOPHIA CHURCH).
  AFGHANISTAN.
  AFGHANISTAN.
  CONSCIENTIOUS OBJECTORS.
  CONSCIENTIOUS OBJECTORS.
HOUSING.
  EXCHEQUER SUBSIDY.
  EXCHEQUER SUBSIDY.
  WAR MEMORIALS.
  WAR MEMORIALS.
  PETROL LICENCES.
  PETROL LICENCES.
  FRUIT IMPORTS (RESTRICTION).
  FRUIT IMPORTS (RESTRICTION).
  MOTOR SPIRIT.
  MOTOR SPIRIT.
  OUT-OF-WORK DONATION.
  OUT-OF-WORK DONATION.
  POSTAL FACILITIES, CHISWICK.
  POSTAL FACILITIES, CHISWICK.
  12, PRINCES STREET (GOVERNMENT OCCUPATION).
  12, PRINCES STREET (GOVERNMENT OCCUPATION).
Preamble
Several Lords—Took the Oath.

ADVOCATES AND LAW AGENTS (QUALIFICATION OF WOMEN) BILL. [H.L.]
Order of the Day for the Second Reading read.
VISCOUNT HALDANE: I need not detain your Lordships more than a moment with this Bill. It is word for word the same as the Bill which your Lordships passed for England on the Motion of my noble and learned friend Lord Buckmaster. It extends the principle of that Bill to Scotland. I therefore, without saying more, move that the Bill be read a second time.
Moved, That the Bill be now read 2a.—(Viscount Haldane).
On Question, Bill read 2a, and committed to a Committee of the Whole House.

REPRESENTATION OF THE PEOPLE (RETURNING OFFICERS' EXPENSES) BILL.
Order of the Day for the Second Reading read.
THE UNDER-SECRETARY OF STATE FOR WAR (VISCOUNT PEEL): My Lords, I beg to move that this Bill be read a second time. The object of it is to remedy a mischief arising out of the Representation of the People Act. Under that Act, for the first time, the expenses of Returning Officers are placed upon the Estimates, and it has been pointed out that this will give to the House of Commons the power of neutralising the right which the Executive has always had of advising His Majesty to dissolve Parliament. In order to place such rights in exactly the position in which they were when the candidates themselves paid the Returning Officers' expenses and to prevent the House of Commons from availing itself of this incidental power, this Bill proposes to place the expenses upon the Consolidated Fund, so that they will no longer appear on the Estimates.
Moved, That the Bill be now read 2a.—(Viscount Peel).
On Question, Bill read 2a, and committed to a Committee of the Whole House.

BARRISTERS AND SOLICITORS (QUALI- FICATION OF WOMEN) BILL. [H.L.]
Read 3a (according to Order) and passed, and sent to the Commons.

PUBLIC-HOUSE IMPROVEMENT BILL. [H.L.]
Order of the Day for receiving the Report of Amendments, read.
LORD PARMOOR: My Lords, when this Bill was before your Lordships in Committee the noble Lord opposite, Lord Harris, and the noble Earl, Lord Loreburn, called attention to a provision which allowed children to go upon the premises of an "improved public-house," and I promised on that occasion to amend the clause in the direction that they desired. I shall therefore to-day move an Amendment to provide that notwithstanding any prohibition of the presence of children upon
licensed premises contained in any Act for the time being in force, the licensing justices may by Order sanction the admission of children to any portion of premises to which an "improved public-house" certificate is attached if they consider that children can be so admitted without harm, but subject to any conditions which may be specified in the Order. That is in accordance with the undertaking that I gave when the Bill was in Committee, and I hope it will meet the views of my noble friend Lord Harris.
Moved, That this Report be now received.—(Lord Parmoor.)
On Question, Motion agreed to.
Children on Licensed Premises.
4. No prohibition of the presence of children upon licensed premises contained in any Act for the time being in force shall apply to premises to which an "improved public-house" certificate is attached.
Amendment moved—
Leave out Clause 4 and insert the following new clause:
"Admission of children to an improved public house."
"4. Notwithstanding any prohibition of the presence of children upon Licensed premises contained in any Act for the time being in force, the licensing justices may by order sanction the

941
admission of children to any portion of premises to which an 'improved public-house' certificate is attached if they consider that children can be so admitted without harm, but subject to any conditions which may be specified in the order."—(Lord Parmoor.)
LORD HARRIS: My Lords, I cannot see why it should not be possible for the licensing Justices to impose such conditions as should be satisfactory—that is, for the exclusion of children from that part of the house where the sale of intoxicants takes place. As a matter of fact, we know now some licensed premises where the improved conditions actually exist. I could name several within easy reach of this Chamber, where children are admitted to that portion of the premises in which tea is served. Therefore I think it perfectly possible for the justices to impose these conditions and to take care that access to the portion of the house where intoxicants are sold is of such a character as to prevent children going in there. I raise no objection.
On Question, Amendment agreed to.

CIVIL CONTINGENCIES FUND BILL.
Order of the Day for the Second Reading read.
LORD HYLTON: My Lords, in asking your Lordships to give a Second Reading to this Bill, authorising the issue of certain turns out of the Consolidated Fund for the
Civil Contingencies Fund and to make further provision in connection therewith, I think perhaps I ought to say a word. In normal times there is a small fund of £320,000 known as the Civil Contingencies Fund, which may be used by the Treasury to finance urgent services until such time as Parliament thinks fit to vote the money for those purposes. This Fund is a purely banking fund—that is to say, all advances from it must be repaid to it, and no final charge can rest upon it.
So small a sum as that which I have mentioned—£320,000—would, of course, be insufficient to provide for contingencies on the present large totals of expenditure. During the war no special provision for contingencies has been thought necessary because the Treasury could meet all war demands from Votes of Credit, but there will be no Votes of Credit for 1919–20 and Departments will be strictly confined each to its own Estimate. It is necessary to make some temporary provision for a larger fund from which the Treasury can
942
meet contingencies. It should not be necessary to make a permanent increase, but provision must be made for the transition period to which I have alluded—namely, 1919–20.
It is accordingly proposed under this Bill to increase the Civil Contingencies Fund temporarily by £120,000,000, in order to provide the Treasury with the necessary financial machinery to finance the requirements of 1919–20. The special necessity arises in two main ways. During the war it has been necessary for the State to buy and sell large quantities of sugar, wheat, other foods and raw materials of all kinds, and to finance exchange operations in order to maintain the foreign exchanges. All these transactions naturally require working capital to meet expenditure pending the realisation of receipts. These services are being brought to an end as rapidly as possible, but in some cases advances for working capital must still be required.
Your Lordships will observe that these advances for working capital are definitely restricted to undertakings on account of exigencies arising out of the present war—in other words, they are purely winding-up operations and do not foreshadow large new trading operations. There is, of course, no intention under this Bill of financing such a measure as the Ways and Communications Bill, which will require Parliamentary Estimates in the ordinary way. The Votes for 1919 and 1920 allow for the issue of very large sums in receipts. Most of these receipts from the sale of stores, &c., will only be available towards the end of the financial year, and the Treasury must have power to make temporary advances in the earlier part of the year until receipts are available. The whole measure is purely a temporary one to wind up operations arising out of the exigencies of the present war. The fund remains, as before, a banking account, against which no final charge car be made. Safeguards are inserted in the Bill which provide that no issues can be made after March 31, 1920, and all issues must be repaid not later than September 13, 1920. In certain cases minutes have to be presented to Parliament. I beg to move.
Moved, That the Bill be now read 2a.—(Lord Hylton.)
On Question, Bill read 2a; Committee negatived.

CONSOLIDATED FUND (No. 1) BILL.
Order of the Day for the Second Reading read.
Moved, That the Bill be now read 2a.—(Lord Hylton.)
LORD BUCKMASTER: My Lords, the reading of this Bill a second time will no doubt proceed as a matter of course. But, speaking for myself, I should be unwilling that the Bill should pass without taking an opportunity of calling your Lordships' attention to the amount of money which it provides. It provides £1,133,852 for services which end on March 31 this year, and it provides towards the supply of next year £440,310,000, and we all know that this is about one-third of the total amount that will be required. A debate will take place in your Lordships' House in a few moments on the financial position of the country, and upon that debate it will be clearly far more convenient that remarks should be addressed on the character and expenditure in which this Government is involving the nation. I only desire to mention, before this Bill passes, that assent to this Bill should not be taken to assume assent to the circumstances and conditions which have rendered this amount necessary.
On Question, Bill read 2a; Committee negatived.

THE FINANCIAL POSITION.
LORD FARINGDON LORD FARINGDON rose to call attention to the financial condition of the country, and to move—
That the serious condition of the finances of the country calls for the exercise of the strictest economy in all directions.
The noble Lord said: My Lords, an apology is, I think, almost due to your Lordships for bringing forward a Resolution dealing with the country's finances so soon after the extremely useful discussion which has recently taken place in this House upon Lord Buckmaster's Resolution with regard to industrial unrest. The economic side of the position arising therefrom was debated at some length and with great ability, but only the fringe of the subject was touched upon as affecting the general financial situation, and I venture to think that it is advisable to consider without delay the serious circumstances in which the country stands.
In August last Lord Inchcape drew attention to this subject and remarked that we were living in a fool's paradise. He ventured to think that we should win through if proper financial principles were observed. It is because I believe that proper financial principles are being ignored, or not given sufficient attention, that I venture to address you to-day. The nation has been startled by a statement made quite recently by the Leader of the House of Commons that our expenditure, is still within £1,000,000 per day of the expenditure current while the war was in full swing, the figure then being in the neighbourhood of between £6,000,000 and £7,000,000 per day. This may be inevitable for the moment, the cost of demobilisation being, as we can all understand, very great; but it is not what was expected, and in many directions we think we see extravagances that could be avoided. Assuming, however, that what is now going on is inevitable, the necessity for taking stock of our financial situation is greater than ever, because the burden the nation is called upon to bear is fast becoming insupportable, and it is only by recognising facts at once and trying to provide remedies for them that disaster can be avoided. I am far from being a pessimist, and when Lord Inchcape's Motion was before the House I ventured to take a more optimistic view of the future than he did; but I am now disposed to think that his estimate of a Budget of £700,000,000 was nearer the mark than the more moderate sum that I suggested; indeed, the figures I shall have to refer to presently, particularly those which have already been mentioned by Lord Buckmaster arising out of the Consolidated Fund Bill, would make it appear that even that huge total of £700,000,000 may be far exceeded.
Nothing but absolutely necessary expenditure must be incurred, and a pruning process must inevitably take place, going to the very root of the bureaucratic evil from which we appear likely to suffer. The necessity for this is abundantly proved by the Estimates which have just been presented for the Civil Service and Revenue Departments for the year ending March next. The tremendous figure of £495,000,000 is put forward as against £88,000,000 in the pre-war year—an increase of no less than £407,000,000. It is true that the Estimate includes items that did not appear in 1913, such as the

945
Ministry of Pensions£73,000,000, and Ministry of Labour £31,000,000, the former a direct result of the war and the latter closely connected with it; also loans to the Dominions and Allies £8,000,000; but excluding these three items we still have an increase of no less than £215,000,000 over the pre-war year for the maintenance of services that were either in existence in 1913 or are likely to a considerable extent to be of a continuing character.
May I take a few of the figures that are included in this increase of £215,000,000? Under the head of "Civil Services" there are three outstanding items—Education, £20,000,000; Bread Subsidy, £50.000,000; Rail-ways, £60,000,000—while under the head of "Revenue Departments" we have in respect of Customs and Excise, Inland Revenue, and Post Office, £20,000,000. No one expects that the education figure will decrease; indeed, it is moderately certain that it will move in the opposite direction. When the bread subsidy disappears its place will probably be taken, of necessity, by some other form of dole; and the railways must under any conditions involve the State in a considerable loss for years to come, whatever may be ultimately decided with regard to them.
The increase in the Revenue Departments—an increase, I think I mentioned just now, of £20,000,000—may, perhaps, be viewed with less misgiving, as it is reasonable to expect some increase in income in normal years from Customs and Excise and from the Post Office to balance this increased expenditure. I have only mentioned these outstanding items of new expenditure as I do not wish to weary your Lordships with a mass of figures, but I think that those I have quoted and the others appearing in the Estimates fully justify a demand for a close examination, and I fear that the continuing nature of a large part of these will be abundantly proved. The Financial Secretary to the Treasury, in submitting to the House of Commons this Vote which amounts to £495,000,000, gave explanations with regard to part of this increase, but his arguments, I think, convinced very few of his hearers, and Sir Donald Maclean voiced the belief of a large section when he stated that "we were heading straight for national bankruptcy."
Several NOBLE LORDS: Hear, hear.
LORD FARINGDON: If I thought that the seriousness of the position was sufficiently appreciated I should not be addressing your Lordships to-day, but the concluding remarks of the Financial Secretary to the Treasury would seem to imply that in his opinion that was not the case. He said—
"If a Government is extravagant, no Chancellor of the Exchequer and no Treasury is going to save it. The Government is dependent on the House of Commons. If a House of Commons does not attempt to hold a Government in check, that Government will go on spending money."
My views of the functions of the Chancellor of the Exchequer differ considerably from those which were given expression to by the Financial Secretary, and many of the Chancellors of the Exchequer of the past must have turned in their graves at the enunciation of the principles here laid down. What would Mr. Gladstone or Sir Michael Hicks-Beach have said if they had been told that no Chancellor could stop expenditure of which he did not approve? The first duty of a Chancellor in peace time is definitely to refuse to sanction any outgoings that he does not think the nation can stand without injury to the whole community, and from what I know of the present Chancellor of the Exchequer I believe he is not likely to accept the rÔle that is indicated by his Financial Secretary.
Your Lordships' House has been deprived by the Parliament Act of much of the control that in the past it exercised over the nation's finances, but I nevertheless believe that the nation looks to this House to give a lead when it is apparent to all who have given thought to the subject that the country is on the brink of a precipice, and it is your Lordships' duty to do the utmost possible to check a mad rush to disaster. It is desirable that there should be placed before the country promptly a straightforward statement of our position in connection with continuing liabilities I am particularly anxious that we should not be understood to be asking for any secrets to be revealed at the present time with regard to the forthcoming Budget. It is the liabilities of a continuing nature that we are particularly interested in discussing at this time. We realise that the future must provide for an annual debt charge of something approaching, and possibly exceeding, £300,000,000 (as our National Debt on the first of this month amounted to

947
£7,500,000,000), that our Army, Navy, and Air Force charges on a peace basis will not be less than in pre-war years, that Civil Service and Revenue Departments will require much larger figures, and fresh burdens are from day to day being piled up; and we want a stocktaking before it is too late.
Several NOBLE LORDS: Hear, hear.
LORD FARTNGDON: Valuable suggestions as to the best form that this stocktaking can take will, I trust, arise out of the discussion that I am now initiating. Various suggestions have been made as to a Royal Commission and Committees of various kinds, but I hope that as a result of the speeches that may follow my own some really valuable suggestions as to the best form in which the stock-taking, as I have called it, can be made, will be forthcoming.
Very few people realise what a permanent Budget amounting to three or four times the pre-war figures will mean in taxation. It will be said, "See how, with comparative ease, large revenues have been raised during the last few years." The answer is, of course, that those years have been altogether abnormal, both as regards payments and receipts; that directly we return to ordinary trade conditions the profits that enabled heavy burdens to be borne must cease, and the strain of taxation, upon whatever shoulders it may be placed in the first instance, must inevitably be borne by the community as a whole. "Heavily tax the rich man for the social needs of the great mass of the community" is a favourite doctrine with the proletariat. What is the result? The banker who has to provide the means for handling the commerce of the country, knowing that out of every sovereign he receives a considerable portion is to be taken from him by way of taxation, must charge more for the accommodation that he gives to the merchant. The merchant passes on this burden to the middle-man or tradesman, with something added probably on his own account; and the tradesman, who has had to pay higher prices for the commodities that he purchases and in all probability also increased rent, increased rates, and higher interest for the money he has to borrow to carry on his business, raises his prices to the consumer, and no doubt the very poorest suffer most.
It is therefore to my mind essential that there should be placed before all
948
classes of the country a simple, clear, and definite statement of our financial position, showing that an annual burden of £600,000,000 to £800,000,000 will hamper our industries, prevent trade revival, and inevitably prevent a fall in price of the necessities of life. Heavy taxation must hamper our trade, as it will keep the foreigner from sending us, as in the past, his capital for safekeeping and investment. Heavy taxation will, as I have pointed out, react upon the price of the commodities that the poorest must purchase and make a constant demand for higher wages, and with those higher wages will come an ever-increasing inability to compete in the markets of the world. It is not, therefore, one class but the whole community that is interested in keeping down our national expenditure.
A number of the social schemes that have been brought forward are doubtless excellent in their way, but they should not be entertained until trade has been re-established and profits made. A section of the community to-day points to the large deposits in the Joint Stock Banks, and because they see growing figures assume that all is well. If increasing deposits were a measure of financial strength then Belgium, whose deposits have gone up by leaps and bounds, is suffering from a superfluity of riches, and Turkey, where there has been a rush to pay off debts, must be financially sound. We know that deposits are no safe index to a nation's wealth, and that plentiful currency in all the countries of the world accounts for a paper affluence which is not a real one. To-day Belgium, Turkey, and other countries cannot pay their way without help, the currency heaped up is only useful as an internal means of bargaining. Our own position is in some respects—in many respects—similar, and any amount of currency will not enable us to pay debts outside the United Kingdom, or purchase the raw materials that we require for our manufactures or the food stuffs for our people.
This brings me to the second point which I should like to touch upon. If we wish to buy from the foreigner what we want, we must sell to him something he requires, remembering that we have no longer to any large extent the power to draw commodities in respect of interest on moneys loaned abroad. To this end, it seems to me, merchant, manufacturer, and work-

949
man should combine interests and work with a will, so that our exports may not dwindle but be largely increased. How this can be done is a problem as great as that of finding means for the reduction of expenditure, but it is a problem that must be solved. Workers in mines and factories are insisting upon higher wages, and in consequence we are no longer the cheapest market for many commodities. A persistence in these demands must cause a loss of foreign markets. Already we find some of our old customers for coal going to America, and some of our textile clients going to Japan and other countries; and there will be an ever-increasing loss of business if Labour and Capital do not unite to prevent it.
One of the first things to be done is to demonstrate that high wages must mean to a country like our own, where so many foodstuffs have to be imported, high prices for the necessities of life. It is not so much the wage as what the wage will purchase that has to be considered. A second thing is to get employer and employed to work together for their mutual advantage. It may be that "capital" in the past has been spelt with too big a C, and "labour" with too small an L; if that is the case, conditions must be changed. In future, in the direction of our mining and manufacturing industries, Capital and Labour must be in co-partnership. The profits accruing must be shared. I have had some experience with workmen, and as a rule, indeed generally, I have found that they are not unreasonable. A minimum living wage is as essential to them as is a minimum rate of interest to Capital. When these two things have been secured, the surplus arising should be distributed in agreed proportions. Labour must in the future be taken into full confidence, be given representation upon industrial undertakings, and educated where education is deficient in the reasons which guide the manufacturer in his business; and the manufacturer should obtain in exchange full value by an increase in the energy of the worker, and an avoidance to a large extent of industrial strife.
If this state of things can be brought about, I am sanguine enough to believe that our coal exports, which amounted in 1913 to £50,700,000, can be maintained, and our exports of manufactured goods, which amounted in the same year to £411,000,000, be largely increased. This
950
will do much to right the financial situation, but it is not enough. We cannot spend thousands of millions upon war, ignoring the day of reckoning. The prodigal may not have spent his substance in riotous living, he may have disposed of it in a way that eventually makes for profit, but in the meantime lie will have to put up with a very husky diet. Economy of the strictest order will have to be observed, both by the individual and the nation.
We have almost brought to a conclusion a just and righteous war. We have poured out our substance in its prosecution, and if we wisely shape our expenditure and avoid industrial strife we may find that a satisfactory investment for our children has been made. If, on the other hand, we ignore the necessity for self-denial, as individuals and as a nation, and fail to secure the co-operation between different classes which is imperative if our trade is to revive, we must inevitably go under; and there are not wanting many who would be glad of the opportunity of throwing their heels in the fact; of the dying lion.
There was an old political phrase that was very much to the fore in the days of my youth. It Was "Peace. Retrenchment, and Reform." The banner upon which that Was inscribed has no doubt been for a long time put away, and is extremely dusty, almost forgotten. I think it would be a good thing if it could be brought out from its retirement, and become the motto for to-day. Peace we ardently long for, and believe is near at hand; retrenchment is essential if the nation is to be saved from disaster; and reform in connection with industrial matters that lead to strife is also essential. But given attention to these three things, bad as I believe the position of the nation to be, I hope there is still time to put it again upon a safe and sound foundation.
Moved, That the serious condition of the finances of the country calls for the exercise of the strictest economy in all directions.—(Lord Faringdon.)
LORD DABERNON LORD DABERNON had the following Notice on the Paper—
To draw attention to the fall which has occurred in the standard of value, as expressed in money; and to move for Papers.
The noble Lord said: My Lords, I think the country is indebted to the noble

951
Lord who has just spoken for the very clear, courageous, and unflinching statement of the financial position which he has brought before your Lordships. There are two points upon which I think opinion is largely unanimous—namely, the grave condition of affairs, and the necessity for the utmost economy and retrenchment. I will venture to say there is another point on which I believe the large majority of this House will be with the noble Lord, and that is that we look to the Chancellor of the Exchequer to act as a controlling influence. In all the great financial periods of history, either in this country or elsewhere, it is the Chancellor of the Exchequer who has acted as the brake upon the wheel. It is useless to look to a democratic Assembly to be as economical as present circumstances require unless guided by a wise mentor.
If I intervene in the debate to-day it is to draw your Lordships' urgent attention to another aspect of the question, to an element in the financial position which has been strangely neglected—I mean the currency. The noble Lord alluded to it in a passing manner. In my judgment it is the root, the governing factor, of the whole situation. The noble Lord spoke of the danger and difficulty of meeting an annual budget of £600,000,000 or £800,000,000. I agree that the sum is enormous, and that the burden is enormous; but what pounds are we speaking of? Are we speaking of £600,000,000 as they were in 1914, or £600,000,000 as they are in 1919? The two are totally different. One is less in value in commodities and in service. One is less than half of the value of the other. Or, again, looking at the future, do we speak of the pounds of 1920 or 1921? What are they to be? Are they to be similar in value and in commodities to the pounds of the pre-war period, or of similar value to the pounds of to-day, or of a different value to either? This question has to be faced; because unless you come to a determination on that subject you are merely talking in the air. In the one case the burden of debt which has been accumulated during the war is more than double what it would be in the other case. The truth is that we are building upon a shifting sand of currency. You may build as well as you like, but if the foundation is insecure the whole structure must come down.
In my judgment the discussions which have recently taken place are entirely
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vitiated by the false assumption that the pound sterling has a stable value. The value has fluctuated violently in the course of the last four years. It has fluctuated so violently that if the same forces remain at work it is absolutely futile to look to a stable value in the near future. I confess for those who think with me on this subject, and who regard this currency problem as one of urgent importance, that it is disappointing and disturbing to find that the factor of change of value has been entirely ignored in the discussions which have recently taken place. My belief is that the arrangements now being made between Capital and Labour can produce only temporary relief unless you provide adjusting machinery to bring the future into harmony with the changes of currency which will occur. The settlement you are making can only meet the requirements in one extremely improbable event—namely, the event that the standard of value will remain precisely at the same level at which it is to-day. If the fall in the value of money which has been going on for four years continues, the remuneration of Labour which you are fixing will prove to be too small. If, on the other hand, the value of money improves—goes back either to or towards the level of 1914—the concessions you have made will be recognised to be excessive. In the one case you have the certainty of further Labour trouble, further strikes, and further unrest. In the other event you have the certainty of trade paralysis, because your working costs will have gone up unduly.
I submit to your Lordships that there is no escape from that dilemma except the one of price values remaining precisely on their present level; and I need hardly point out that this eventuality is extremely improbable. I say, therefore, that until you have eliminated, or corrected, or provided adjusting machinery for, this new factor of disturbance, it is vain and futile to talk about good national finance. After all, national finance is a super-structure; the basis and foundation is good trade and good industry. Unless trade and industry are prosperous there is no good national finance. At the present moment, as the noble Lord has pointed out, the outlook is far from reassuring. Apart from other circumstances, the relations between Capital and Labour leave a great deal to be desired. What is the reason for that? I believe it is mainly the violent disloca-

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tion of prices which has occurred during the last four years. It is the common practice to talk about the rise in price of this or that commodity, the commodity in which the speaker happens to be interested; but when the rise affects, as it does to-day, every commodity with a free market—every commodity which is not controlled—the phenomenon with which you have to deal is not a rise in the price in an individual commodity but a fall in the standard of value. You have to adjust your whole system to that.
It is admitted, I think, that when a fall of this kind takes place there is a theoretical case for the revision of contracts based upon money, and there is a practical necessity to revise contracts where the contracting parties are not able to survive so great a dislocation—where their financial circumstances do not allow a sufficient margin. The change in the standard of value affects every class. It affects very largely fund-holders and landholders; it affects the Civil Service in a very marked degree; it also comes into the relations between the State and the taxpayer. And when the shifting of balance between money and commodities attains to present proportions it is absolutely impossible to hope that you can go on without adjustment. What I venture to put before your Lordships is this, that without advocating any particular solution, and without having the smallest desire to attribute blame to anything which was done in the past, the vast importance and influence of this factor must be taken into full account.
It is well known, of course, that there has been a progressive fall in the value of money for the last 700 years; but the fall in the last four years has enormously exceeded other falls. In fact, the fall is equal to that which took place from 1300 to 1700, a period of 400 years. It is fact, greater than the fall which occurred between 1700 and 1900, a period of 200 years. It is not too much to say that there is no period in history where a similar fall has occurred. The only times when anything approaching it has been seen were between 1600 and 1640, at the time of the discovery and the working of the great silver mines of Potosi; and again in the Napoleonic Wars; but on neither of those occasions did the dislocation at all come up to the dimensions of the dislocation of to-day. In I860 there were universal
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complaints of the enormous rise of prices. What had prices risen?—30 per cent, above the pre-war rate. But to-day prices are 130 per cent, above the level of 1914. It is vain to expect that this enormous factor of change can be left out of account. It is clear what has occurred. Before the war payments for personal services were subject to contracts, the remuneration being expressed in wages. Those wages were stipulated for and paid in currency. The currency in which they are paid is worth only 43 per cent, of what it was when the contract was entered into. You cannot be surprised if in these circumstances there is grave discontent. You cannot be surprised at Bolshevist tendencies being shown. I myself marvel that the disturbance has not been greater and did not come sooner.
You may reply that in a large number of trades an adjustment has been made; that wages, or allowances, have been agreed to which to some extent compensate the rise in the value of food and other commodities. But even here, although I think that is a step in the right direction, the process is not satisfactory, because you have done this to meet an individual case in a temporary manner. There has been no attempt to meet it permanently, or to invent a sliding scale which will prevent the difficulty which you are endeavouring to remedy from recurring in the course of a few months or of a few years. And the settlement is also, I think, unsatisfactory in that nominal increases are granted and it they were real increases of remuneration, which they are not, but the mere adjustment to a new condition. There is this still further cause of unsoundness in the procedure—that the correctness of what you are doing, and the permanence of what you are doing, is dependent entirely upon prices remaining precisely as they are, and there is but a small chance of that occurring.
I venture to believe that a great deal of what is termed political unrest, or social unrest, which is occurring not only in this country but throughout the civilised world, is due and can be traced to this enormous dislocation of prices and values. Through the whole range of social disturbance I hardly see anything which is not more or less powerfully connected with that cause, except perhaps influenza. Certainly Bolshevism is very largely due to high prices, and high prices proceed

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n the main from currency causes. I hope that your Lordships will not consider the subject as too dry or too abstruse for detailed discussion. Whether it is dry or not, or whether it is abstruse or not, I am convinced of this—that the problem has got to be faced, has got to be talked right out, and a sound conclusion arrived at. Any diagnosis of the financial position which ignores this factor is necessarily false and essentially erroneous, and any proposed remedy for industrial unrest based upon a false diagnosis will not give the country either the prosperity or the stability which is required, and without which any reform of finance, any sound financial system, is absolutely impossible.
VISCOUNT PEEL: My Lords, the noble Lord, Lord Faringdon, has introduced it subject of the gravest and also the widest importance, and of course we all recognise that on a subject of this kind he speaks with wide experience and authority. Nevertheless, I thought that he used—or shall I say quoted with approval—certain phrases which go rather beyond the situation at the present time. He spoke of "dangers of national bankruptey," and "approaching the brink of a precipice"—phrases which certainly do not represent in any way the view of His Majesty's Government of the financial situation.
But before I deal with some of the wider aspects of the subject—the general financial aspects which have been alluded to by my noble friend—I should like to say a word or two on the point raised by Lord D'Abernon on the question of the devaluation of money, or the £sterling, as I think he put it. It is, of course, impossible to deny that very grave social disturbances are likely to arise from any sudden disturbance of the relation between goods and the currency. My noble friend referred to historical instances where this had taken place, and I think he declared that the rise in price, or the consequent de-valuation of the currency, during the last four years exceeded that which took place between 1700 and 1900. There have been, of course, very notable instances of this sudden fluctuation in price. Two notable instances have been mentioned, one after the Black Death in 1349, and the other after the fresh discoveries of silver in the sixteenth century, and, as the noble Lord said, the consequences of those are known to all. They upset the basis on
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which contracts are made and upset the calculations of landowners and others who are taking payments in fixed amounts of money. As a rule these movements are slow, either upwards or downwards, and perhaps are only drawn to our notice by writers and economists; but so rapid has been the rise during the last few years that it has been brought home to every householder and every woman. Every woman realises that the money she has now purchases only a little more than half what it did four years ago. Where these changes are rapid there is, as my noble friend said, great danger of social ferment and social discontent.
I think, however, we should be very careful as to the precise nature of the figures used. My noble friend used the figure, in describing the rise, of 130 per cent., and perhaps I ought to point out that that only represents the purchasing power as regards food prices. It does not include, and is not intended to include, other items like rent and clothes and other matters, and if all the other prices affecting working class expenditure are taken into account the figure will be very much more like 120 than 130. At the same time the increase is very high. There is another fact bearing upon this social unrest which is worth noting, and this was examined very carefully by Lord Summer's Committee, which reported last year, and that is how far the burden has actually been felt—that is to say, how far expenditure has actually risen to the same extent as retail prices. That Committee found that expenditure had risen in a less degree, partly owing to the curtailment of supplies, and partly because of the substitution of commodities for the particular commodities on which these figures are based. That may be an unfortunate circumstance, but it is worth weighing when considering the percentage by which commodities have risen.
Unfortunately, looking forward with great hopefulness to the future, it seems a long time before there is much chance of these prices falling within 50 per cent, of what they were before the war. There are, however, some points of hopefulness and some signs of the dropping of these food prices, which are so closely connected with social unrest. Lord Sumner's Committee estimated that the average weekly expenditure of a family of the working class was in 1914 24 s. 11 d. and in 1918

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47 s. 3d., a rise of between 80 and 90 per cent. Up to just about the end of March it is estimated that the fall in necessary food prices would make a difference of something like 1s. 10 d. in that expenditure, and before the end of May it is hoped by further falling in prices that the reduction will be something like 4s. per week.
My noble friend is familiar with, and I need only allude very shortly to, the remedies applied to this state of things anyhow during the last period of the war, when the fixing of prices for certain commodities took place and when certain rises were made in wages to meet a difficulty from the other side. Of course, the rise in wages, as my noble friend suggested, has not been even all through, and there has been really no machinery for equalising throughout all the trades that rise in wages to meet the increased cost of living. My noble friend knows that in some countries Price Commissions existed for the purpose of controlling prices, but I do not think the experience of the recent election gives much hope that it would be considered advantageous or in the public interest to maintain this control of prices here. But there is at the present moment—and I think it is a discount which one must make use of in considering what these figures mean—no one Department in this country which deals with the figures of the rise of prices on all commodities as a whole. Certain commodities may be estimated by one Department and some by another.
The Committee on National Expenditure, which went very closely into this matter, considered that the basis on which these Board of Trade figures were made was, I will not say antiquated, but to some extent out of date, and that a further examination was necessary in order that a proper figure might be obtained by which a comparison could be established between the cost of living at the present time and before the outbreak of war. My noble friend also discussed the question of the rise of prices. Of course, a very large number of causes may account for the rise in prices. There are so many that it is very difficult to select between them. There is the vast shortage of supplies owing to the diversion of material and labour for war purposes, the shortage of shipping, adverse exchanges
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arising from adverse trade balances, and there is also the question, which has been much commented on, of the possible depreciation of the currency through the issue of Treasury Notes. I understand I that my noble friend did not lay very much stress upon that.
That question has been very carefully examined both by Lord Cunliffe's Committee and the Committee on National Expenditure. Both I think, come very clearly to the conclusion that the issue of Currency Notes was merely the consequence and not the cause of the system by which the war was financed; that the real trouble was the inflation of credit rather than the inflation of currency; that it was impossible to finance the war either I wholly from taxation or even from the savings of the people, and that, therefore, you had to have these vast creations of credit transferred to the Joint Stork banks, making these large deposits of which my noble friend complained; and that—in order that this purchasing power might find vent so that contractors and others might have sufficient currency to pay higher prices and wages for the amount of work done on their contracts—it was absolutely necessary that these Treasury Notes should be issued, although, as my noble friend knows, the extent to which these Currency Notes could be used was very severely limited. These Notes were only issued, of course, to the banks in return for debits or securities that were deposited.
Therefore, I think we can satisfactorily say that whatever was the cause of this increase in prices it was not due. as some authorities have suggested, to any depreciation of the currency itself, but rather to the question of the necessary inflation of credit. I think it is worth observing also—because it does bear very much on the general financial situation of which my noble friend has just spoken—that this country has taken the lead in the extent to which it has attempted to finance the war out of taxation. The taxation per head of the population has risen from £3 10s. at the beginning of the war to nearly £17 now. That is a rise of nearly five times. I think, perhaps, it would be rather interesting, too, if I alluded to the distribution of this taxation as between indirect and direct taxation, and compare that of one or two years before the war with the situation now. In 1903–4

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the indirect taxation was 50.7, while the direct taxation was 49.3, showing an almost even balance between the two. At that time the amount of tax revenue per head of the population was £3. Then, in the year 1913–14, the indirect taxation was 42.5 and the direct taxation 57.5, and at that time the amount of tax per head of the population was £3 10 s.
Coming then to the year 1918–19 the comparative figures are very interesting. First excluding the excess profits from the calculation the indirect taxation is 30.21 and the direct taxation is 69.79, showing a vast increase. That works out at £10 5s. 2d. per head of the population taking the population at 47,000,000. If you exclude excess profits, which no doubt you ought to do, you get a still further remarkable result. The indirect taxation is 18.63 and the direct taxation 81.37, and the total amount of revenue per head of the population is £16 12 s. 10 d. There have been no suggestions, of course, that currency has in any way depreciated through the methods employed in other countries. There has been no suggestion that the Treasury Note has depreciated as against coin. The most that Lord Cunliffe's Committee suggested was that possibly it might have depreciated to some extent in terms of bullion, and we know the value set by manufacturers and others upon bullion at the present time. I think the point is worth establishing—that the rise in prices has been due to shortage, to enormous waste in the war and kindred causes of that kind, and not to any depreciation of the currency itself.
Although it may be said that, from the point of view of the working classes, it does not make very much difference to them what the cause is so long as the purchasing power of their money has gone down, yet it does make an immense difference as regards the remedies; because, of course, if there had been this depreciation of currency, some such method as is advocated by Lord Cunliffe's Committee for the withdrawal of Treasury Notes and the reduction of currency—though, of course, advised on a very different ground, namely, that of restoring the position of the Bank of England in control of foreign exchanges—might be adopted to set the matter right. But if it is due to this general rise in prices caused by shortage, an absolute deficiency of material, and waste of war, then the situation is much more
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difficult and really much more complex, and one is rather apt to get into that vicious circle when a rise in prices in one trade at once sets going a rise in prices in another trade, and at the end nobody is very much better off.
My noble friend made an interesting suggestion, that there should be a Committee, or some Board, which should be constantly examining the relation between wages and prices, that they should ascertain when there was this devaluation (I use his word in preference to depreciation, which has another significance in regard to currency), and that wages should be raised accordingly. This, of course, has to some extent been done in some industries, and the suggestion is that it should be applied generally over the whole country. It is a very valuable and an interesting suggestion, but it is open, I think, to the same objection as profit sharing—namely, that it was all very well so long as there are profits to share, but when profits began to fail there may be again some fear of social disturbance. The same criticism would therefore be applicable to my noble friend's suggestion, as at the present time prices are beginning to fall, and it is hoped they will fall; therefore this Committee or Board would have a tendency to diminish the amount of wages in agreement with the fall in prices rather than to increase wages. Nobody knows better than my noble friend that what the working classes want is not so much to maintain some relation between the goods they can purchase and the value of money as an actual increase in the standard of life itself: and that I will not be met by my noble friend's suggestion.
I should like to say one word about the criticisms made by Lord Faringdon upon the Estimates and upon general expenditure. My noble friend, of course, did not fall into the error, which a great number of persons do, of treating the war as over. From a financial point of view no doubt by far the most serious period of the war is the aftermath; and the years that follow the war. Moreover, the very fact of peace, and the activities of peace, bring with it a large increase of expenditure which was not necessary during the war, but which is a direct consequence of the cessation of the war, and the efforts made in the war. There are, for instance, a very laree number of what may be

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called "terminal charges" which must be met. and in estimating the value of the statements of Lord Faringdon I think we ought to keep very clearly in our minds where the possibility for economy comes in, and where there is any possibility of economy. These sums have to be paid. We have to face them as best we may, and consider rather not whether they ought to be paid but how they should be paid.
For instance, all the officers and men discharged from the fighting forces have to be paid considerable sums as war gratuities. Then there are all the running contracts which have to be brought to an end, and for which large sums have to be paid which would probably Lave been spread over a considerable number of months, or years, it the war had continued. There is the discharge of innumerable workers from the munition works who, again, have to be given considerable sums as a provision against unemployment. Then there is a whole hoist of matters—questions of reconstruction, postponed during the war but which have gained weight and momentum during the war. They have to be dealt with when peace is in sight. There are all those questions of the increase of debt charges, increased expenditure owing to the rise in prices, which takes several forms—one is increased wages to soldiers and sailors, police and Government employees, which have been, I think, generally assented to—and the increased cost of supplies and food to prisons, asylums, and other institutions. Any hope that we may be able to revert in these matters to large economies, even with the best will in the world, I am afraid is rather futile. In spite of these necessary expenses, expenditure has, since the Armistice, very largely gone down. My noble friend said that the expenditure now was only £1,000,000 less per day than during the war, but the figures I am provided with show that it is now less by £2.000,000 per day, or a reduction of 30 per cent.
LORD BUCKMASTER: What is the present expenditure per day?
VISCOUNT PEEL: I have not the exact figure, but I can get it. I am of course in this difficulty, and I hope your Lordships will sympathise with me, that the Budget statement will soon be made and I am not in a position to anticipate, by immemorial custom, any of these figures and statements which will be in
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cluded in the Budget. It also prevents me from going in some detail into the question of recurring expenditure and non-recurring expenditure. Let me take the figure of £1,500,000,000—the expenditure for 1920, which has been so much discussed in the Press. If you take that figure and compare it with the estimated expenditure for the previous year, which was £2,976,000,000, you get on that figure alone a reduction of nearly 50 per cent.
Let me make one or two observations upon the Estimates, on which my noble friend commented rather severely. There is, of course, the Army Estimates of £440,000,000 gross, and £287,000,000 net, after the Appropriations in Aid; the Navy Estimates of £149,000.000 and £200,000.000; and the Air Force Estimates of £56.000.000. The consideration which I have mentioned, that the war is not yet over, that peace is not signed, and that there are these vast terminal charges, must apply to all these Estimates, and they must by no means be taken as Estimates that are likely to recur in the future years, or even next year. All these Estimates are largely provisional, and, as it has been stated, may be subject to large revision and reduction daring the coming year. My noble friend fell foul of the Civil Service Estimates and the large amount of £495,634,000. He quite realised that you must not compare the Estimates for this year with the Estimates for last year, because so much of the cost was financed by Votes on Account, but I do not think he did full justice to the extent to which these Votes on Account piled up the expenditure on these Civil Service Estimates. I take one or two examples from the Estimates themselves. The Estimate for old-age pensions in 1919–1920 is £17,892,000, as against £12,085,000 in 1918–1919, and this figure of £12,000,000 odd is exclusive of £6,046,000 which was the extra 2s. 6d. borne, in that year on the Vote of Credit. If those two Estimates were fairly compared there would oven be shown a slight, though a very slight, reduction in the extent of the Estimate. I need not remind your Lordships that because all these figures are now involved under one head instead of being divided into two it makes no difference whatever to the general expenditure of the country.
If you add the Votes on Account and the Estimates for the previous year together,

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and compare them with the Civil Service Estimates for this year, you get I think a rather more hopeful figure than the one alluded to by my noble friend. The Civil Service Estimates plus the Civil Vote of Credit charges amounted to £740,289,000 for the previous year, while for this year the figure is £495,000,000, showing a decrease on the whole of £244,664,000, which it will be admitted, is a substantial decrease. Again, these figures must be subject to large reductions in the future, and even possibly to some extent this year. There are a very large number of exceptional charges in the Estimates for 1920. My noble friend alluded to one of them—loans to Allies and Dominions, amounting to £87,000,000. Then there is the bread subsidy of £50.000,000. and a number of other figures that I need not mention. There is a very large figure for the Ministry of Labour for unemployment benefit, largely of course arising out of the war. That figure is something like £25.000.000. There is another very large figure included in these Estimates for pensions to disabled soldiers, amounting to something like £73,000,000. Some of these figures are recurrent, and some are non-recurrent, and some of the non-recurrent figures are very large indeed.
I do not wish to put forward any of these observations regarding the Estimates as suggesting that large economics may not be effected, or that the position is not very serious. Every one will echo the statement of my noble friend that the severest economy is absolutely necessary, but I think a great deal more is necessary than mere economy. We lay too much stress sometimes on the negative virtues—on the virtues of abstinence and self-denial—and not enough on the more active and more attractive virtues. In this case we want to call attention not so much to the necessity for economy, and not so much to the necessity for paying off floating debt and reducing expenditure, as to the need for further activities for the production of wealth on a large scale. That is far more important than the negative question of economies.
Financially, I think that it is not too much to say that the worst period of the war is the period after the war. We are all, I think, so debauched by the facile way in which these vast sums of money have been raised on loan during the war that we are inclined to think that that happy state
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of things can go on longer. We have been apt to mistake the machinery of wealth for wealth itself. It is no doubt a very hard demand to make upon our people that after they have gone through the tremendous struggles of the war they should make still greater efforts in order to build up again the national wealth. Yet that is the plain lesson which is to be drawn from the financial situation. We have to work, not as hard as, but far harder than, we did before the war. Let us therefore brace ourselves as a nation to the task of creating wealth before we quarrel among ourselves as to the important question of its distribution. I should like to say, on behalf of the Government, that as regards the Resolution itself they will place no opposition in the way of my noble friend.
VISCOUNT HALDANE: My Lords, I admit at once that it is with a certain sense of disappointment that I have listened to the speech of the noble Viscount. I miss in it an injunction to the one thing needful. The noble Viscount passed in a very interesting review, in the first part of his speech, what was said by Lord D'Abernon. I was impressed by what Lord D'Abernon said as to the close connection of the state of things that we have to-day with the state of things which, at least to some extent, is mirrored in the currency. It is no doubt true that in this country the issue of paper money has operated to a very small extent upon prices relatively to what has happened in other countries.
But if you want to see how these things can operate look at other countries. Look at Russia to-day. Look at the effect of paper currency upon prices there. Look at the enormous prices that have to be paid even for the necessities of life, yet paid in paper which has so depreciated that its purchasing power is very little indeed. Why is that? Because of the recklessness of the Government in issuing paper money. That has not been the case here. There has been a great deal of care here, but there has been something which is a parallel to these things. Lord D'Abernon said truly that what was bad in paper money was not that it should be paper money, or that it should be depreciated currency, but that it should not be a steadily depreciated currency—that is to say, a currency which fluctuates in value. This it is, as he pointed out, which is so disastrous.

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These things have their parallel in the excessive use of credit. If there is one thing which I think has led to the financial misfortunes that have followed this war it has been largely the same reckless use of credit. I am far from reproaching the Government for having borrowed. They could not but borrow, and they have borrowed much less than other countries. It is very much to the credit of the nation that it has paid its way to the extent even that in has. and the noble Viscount was well justified in drawing attention to the fact that the taxation which has been imposed was a very extensive taxation. Still we have been borrowing much more recklessly than we should, and we are borrowing to-day much more recklessly than we should do. One reads morning after morning of some new undertaking which has to be paid for out of credit. This morning it is new buildings that are to be built out in the country for housing Civil Servants. Yesterday it was Chepstow. The day before that it was Slough. Constantly the evidence is forthcoming that there has been no adequate financial cheek upon the way in which the credit of the country has been used. That is almost inevitable in the course of a great war. During a great war you are struggling for your life, and it is only a secondary consideration what becomes of your finances. But that does not relieve you of the necessity of looking ahead and doing all you can to get your finances under some control.
I think that one the great features of this war has been the difference between the Civil Servant and the business man. The Civil Servant, admirable in matters connected with finance but not trained to carry on the businesses which the necessities and the scale of -the war entailed; the business man, on the other hand, excellent at organising new things swiftly, promptly, efficiently, but, when it is not his own finance that is in question, apt to regard the resources of the Government as a sort of bottomless purse into Which he may put his hand. The result is that no doubt there has been a most enormously extravagant expenditure. The worst of that is that it gets into the heads of the people that the purse, is bottomless. A good deal of the trouble which we are having at the present time, I quite agree, is due to this, that the working classes see that money apparently is to be had for the asking, that everybody can get it, and therefore they
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begin to be less careful than they would otherwise be in their estimates of what is due to themselves for the labour that they render; and—more than that—what Lord D'Abernon laid stress upon, the fluctuations in the value of money and in the value of credit—because it comes to the same thing—the fluctuations which take place without adequate stability give a sense to the Working classes that whenever prices are high they will continue high, and that they must estimate on that basis in the future.
All this brings one back to what I have spoken of as the one thing needful, and that is to get back to t. cash basis; and to a cash basis we cannot get back mini the terms of peace are settled, and until the terms of peace are so settled that we know where we stand and what we shall have to provide for in the future. Now, I know that the Government are doing their very best to settle the terms of peace, and I only wish that there had not been in the world so much of the cry of "VaeVictis" in the past as has made the settlement of those terms of peace far more difficult than it would otherwise have been, and has given rise to the sort of thing which one reads of just now, which points to war not being at an end, and to the possibility of even fresh war breaking out after the terms of peace have been settled. By all means let the Government concentrate themselves as the very first duty on settling the terms of peace as precisely and adequately as possible. This is the indispensable preliminary to your cash basis. Then, when you have done that, there is something more you have to do, and that, you must do even in anticipation of the terms of peace, looking ahead.
The noble Viscount spoke, for example, of the Army Estimates. Well, the Army Estimates are £440,000,000. There are, of course, Appropriations in Aid on the other side of the account, but these do not detract from the fact that that is the expenditure, and it is partly necessitated by the keeping up of the Army for the purpose of securing the peace settlement when it comes. If I had been in the House of Commons the other day I should certainly have voted for the Bill of Air. Churchill, the War Minister, when he proposed to carry on the system of compulsion under which tins Army has been raised for a little longer in order to liquidate the situation. I should have voted for it because no other way is possible. You

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must keep up an Army in order to bring your terms of peace to an effective conclusion. But I think I should have had something to say about the vain hopes which were held out as to the abolition of compulsion at the Election, and the bitter disappointment which was the result to many people.
However, that is not all. We look forward to a state of things in which we shall return, as Lord Faringdon said, to a defence system on something like the scale which we had before the war. Here are the Army Estimates of £440,000,000. I should have liked to hear the Government say definitely, "What we contemplate is to return to the state of things before the war or something equivalent to it." The Army Estimates before the war were £30,000,000. How are you going to get down from £440,000,000 to £30,000,000? You can do it by saying what sort of an Army you are having, and for what purposes you are having it. But I see nothing either in the arrangements of the Army or of the Navy or of the Air Force, as announced by the Government, which give me that definite stand as to what we are to look forward to, the definite purpose which is to be attained, which is the key, and the only key, to economy in the future. Until you say what you want your Army for, what you want your Navy for, and what you want your Air Force for you cannot get things down. And although I quite agree until the peace is established and its terms firmly settled you cannot say that finally, it is yet essential that you should say it beforehand and define the standard to which you mean to work. I will tell your Lordships why. Because until you do you will never get that large class of experts who have been engaged in providing the necessities of the Services to take seriously the duty which will come to them after the war, or to make a beginning. The longer you put off accustoming their minds to the fact that the Government has got a definite plan which it is going to drive through, as with an axe, the more imperfect will be the attainment of what you set before yourselves in the way of economies.
It is there that I think the Government have been most to blame. Ministers go on talking as though we were continuing quite easily in the present condition of things, with the ideals and
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objects which we have inherited from the period of the war. But until you say definitely what is to be the government of this country after the war, and until you lay down, not in vague platonic declarations, such as we had from the noble Viscount this afternoon, but in definite terms as the standard to which you are to work, then you will never get the beginning of that real return to a cash basis which is the one thing that can save you from the path down which you are passing at the present time. I wish to see something of the spirit of Glad-stonian finance once more. One sees very little of the man with the axe, who says "this cannot be."
In what the noble Lord, Lord Faringdon, said in one part of his speech he gave us a very interesting and highly instructive picture of the financial conditions. He dealt, not with the Military and Naval and Air Estimates, which in my opinion are the most relevant for his purposes, but with the. Civil Services. I think he stated that the Civil Service Estimates for the year were £495,000,000, and that there was an increase of £215,000,000 upon the old condition of things. Now Lord Faringdon did admit that there were one or two items of increase which he did not expect to get rid of—for example, education. I am afraid there are a great many more items than the noble Lord spoke of that we are not likely to see decrease. Everything that goes to production, if this country is to come through, it has got to produce much more largely than it has done hitherto, and much more effectively. That implies money spent on research, money spent on spreading knowledge, and also spent on preparing the future generation to bear the burden which will have to come upon it.
And more than that. Although it is perfectly true, as has often been pointed out, that even if you divided up the wealth of the rich among the poor you would add very little for the benefit of those poor men, still the burden of our expenditure does go a considerable way in improving the conditions under which the poor live. Nothing has come out which, I think, has made a greater impression on the public mind than the evidence given before the recent Coal Mines Commission as to the conditions under which large portions of the mining population live. And I think the country is behind the miners in saying

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that that must cease. But if you ask the railway men or the policemen you will find that they tell you if you talk to them "We want a little more money, not for luxuries but because we recognise more and more the need of educating our children, and we want to give them a better chance than we have had ourselves." And right through the working classes you find not merely the cry for more money, of which we have heard, something this afternoon, but you find that there is a real recognition—a recognition which is backed up by the national feeling—that the conditions which separate the rich and poor should be less marked and divergent than they have been hitherto.
If that is so, then there are one or two things We have to try to make clear. No industry should be carried on by the State, or under the State's supervision, which cannot pay its way; which cannot produce for itself. Its production should be such as to be able to make ends meet within that industry; and I think that is not beyond our capacity if we take the Working classes freely into our confidence, and if We let them see that the interest which we put first is that of the community and the consumer, and that no particular class is preferred to another class. That implies the spread of knowledge, the spread of interest in the. means of production, and the encouragement to produce; and it involves a good deal more money going under these heads than has gone hitherto. Therefore I am not able to agree with Lord Faringdon when he said that, good as many of these things are, they ought to wait until we reach the state of things in which these industries had recovered themselves and trade was upon the footing where prices Were the same as they were before. We cannot wait. These things to Which I have alluded are the most urgent We have to deal with. If you think it is distressing that at a time like this there should be such agitations as have brought is to the verge of a national strike all I have to say is that if you contrast the conditions of this country with the condition of such countries as Russia, or even as Germany, you may be thankful that things have assumed that form.
With what Lord Faringdon said about What I call the cash basis I am in entire agreement; but in the other part, where he seemed to argue as though mere
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economy, a mere cutting down of expendituse, was a duty imperative and paramount in itself, without looking to circumstances, there I am unable to follow. As I have said, I am sure We have reached a point Where if the foundations of Government are to remain secure, if We are not to be faced with agitations which will burst out when we least expect them, We have to do our best to put these matters on a different footing. It is a different kind of national standard with which We have now to deal. The War has brought us into a new period. It is not that the movement of to-day is a new one; on the contrary it was there before the War. When I was a member of the Government in 1912–13 I had to come in contact with Labour agitations on a very large scale which Were at that time very threatening, and I was struck by the largeness of the ideal which Was in the minds of those who Were pursuing that agitation. It was very much what We have to-day only in a less acute form; but it was there all the same. To-day it is true that it is on a very much fuller scale, and if I mistake not it will turn out presently that these new notions have taken possession of the minds of a very large section of the community, and, however little We like it, we shall have to recognise that our Working class are looking forward with new aspirations.
I am not one of those who take a gloomy view of the situation. I believe that if you take the working classes into your confidence and get them to give you their confidence you will find that they have very much the same aspirations as we ourselves have. They know what is meant by the problem of production, and they also know what is meant by the problem of justice between man and man. They are ready to deal with you if you will deal with them. I think the Government are to be congratulated on the way in which, by recognising this in the course of the recent dispute, they have averted what threatened to be a most, serious condition of affairs. But it is by proceeding in that spirit and in that spirit only that we can be secure for the future. We have a most formidable financial position to face. It may be that the national expenditure will go to something like £800,000,000. I do not know; I should be sorry to give a certain prediction on the point. But even if it does, if we take the great national situation seriously—as seriously as we took the war—pre

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pared to go into it and to make sacrifices, we shall find that the nation has the strength and the grit which will enable it to deal with that question too; and if it deals with it successfully it will leave behind it a more contented and more stable nation than we see at the present time.
LORD FABER: My Lords, the future seems to me to be so obscure that it is dangerous to prophesy, and certainly futile to dogmatise. I should like to allude this evening, first of all. if you will permit me, very shortly to the Government's position as we seem to know it; and, secondly, to certain problems of some magnitude in which we in this House are all interested, and which it is sometimes well to look at from an outside view and sometimes well to talk about among ourselves.
Now to take the position of the national finance as sketched in the House of Commons dining the last few weeks. I begin by saying that I entirely agree with one of the speakers when he said he thought this coming year—the year that begins on April 1 next—should be taken as a war year and not as an ordinary year. How can it be anything else but a war year? Here we have Armies all Over the world, a Fleet on the seas doing the blockade—we have innumerable forces everywhere. It would be rather futile. I think, to budget for a peace year under those conditions. The expenditure is still very high; but if we look back to what it was at the beginning of this year which ends on March 31 we shall see—as was said from the Government Bench to-night—how much better off we are now than we were then. This time last year we budgetted for no less than £3,000,000,000 for the expenditure during this year. We spent in this year only £2,600,000,000—£400,000,000 less. Now this year we are budgeting for £1,500,000,000" as against £2,600,000,000 of last year. That is a falling off of £1,100,000,000—we shall be better off in that respect by £1.100,000,000—and out of the Budget, including the Excess Profits Tax, we expect to get I suppose some £900,000,000. That will leave a deficit of £600,000,000 to find from somewhere. Where can we find some of these millions? There are the immense realisations going on now in war stock belonging to the Government, of all kinds and sorts, and I hope it will proceed faster
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and faster as the year continues. There are debts due from other nations to ourselves; and there is also, I hope, the first instalment to come from Germany of that debt which is apparently to be protracted and to last for perhaps thirty, and perhaps fifty years.
Your Lordships will be surprised at what I am now going to say. I think that on the whole I should not put on any further taxation during this coming year. I should see where we are. If you put on new taxation—of course, it is difficult always to understand new taxation—it upsets the nation; and if this is a war year, at the end of this year we may be in a position to do without these extra taxes at all. Therefore I think it would be unwise to put on new taxes for this year. I must be understood to mean this year only. Another year, when the war is really over, we shall have to get a taxation to meet our liabilities, never mind how big that taxation may be. We must not go behind that; it must be only for this one year. The Excess Profits Tax is an interesting tax, and I think, perhaps, it should be reduced from 80 per cent, to 60 per cent. Because the young men going into business now dare not face this Excess Profits Tax, and it keeps them out of business. There again the Excess Profits Tax is a fair war tax, and a tax upon profits which would not have been made unless the war had been brought about. I happen to know a little bit about the Excess Profits Tax, because I have been on the Board of Referees ever since the beginning of the war. It will be interesting to give o, concrete instance of how that taxation works out; it did not come before me on the Board of Referees, but it is a private case which came before me a short time ago, and it shows the inner working of the tax. A man in business in the City in 1913 had a bad year and made only £5,000. The year 1913 is the datum year, your Lordships will remember, on which excess profits depend. In the four succeeding years he made £150,000 a year. What is the position of this man? He gets his £5,000 subtracted, and that leaves £145.000. The trader gets one-fifth of that—namely, £29,000. Add £29,000 to the £5,000 to which he is entitled and the trader gets £34,000 out of the £150,000. Therefore the Government get £116,000 a year out of that one trader. Your Lordships may say that that seems a hard case, and looking

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at it in one way it does seem Laid, but when I come to analyse it I find that this man only made £20,000 a year profit before the war, and so was not deprived of anything, although for the Government he made £116,000 a year. That case shows the working of the Excess Profits Tax.
Now I approach the subject of the conscription of capital. That was mentioned once or twice tome weeks ago but nothing came of it, and I do not expect that anything will come of it. But has it ever occurred to your Lordships that if the Income Tax is put up much more we may be conscripting our own capital. Let me put this case to you. To-day with Income Tax and Super-Tax and local taxation we are paying, I suppose, some 12 s. in the £, and that leaves us 8s. in the£. Suppose that next year—it is not unlikely, because we have got to find the money—another 3s is put on the Income Tax. Then we shall have to find 15 s in the £, and we shall only have 5s. left to live on. How many of us can live on that? we shall have to spend capital, and therefore I think that in tins true sense we shall be conscripting our oval capital. Therefore, although the Government should not conscript it en bloc, we may have to do so, one by one, when the time comes.
Going into that subject a little bit further, it is very interesting to see what happened in. France. A few days ago the Finance Minister mentioned the fact that they were considering a tax on capital. What was the result? At that moment the French exchange made it possible to buy a sovereign in this country for 25.90, being about the par of exchange usually. Directly these remarks were made in the French Parliament re capital conscription the exchange bounded largely, and you could no longer buy a sovereign for 25.90, but had to give 26 and the following day 26.50 and the day after 27 francs for the £. That looks as if the men in France who had money were rather inclined to buy sterling and get their money out of the country, lest it be affected by capital taxation. I do not say that that was so, but your Lordships must judge for yourselves whether the announcement of the Finance Minister had anything to do with it.
Then I come to another subject which interests us all, and that is the subject of investments. In 1904 the investment market, the gilt-edged market, had reached
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its highest point. Consols were at a point which they had never reached before—namely. 112. From then until this very day there has been a down-grade market all the way. Investment stocks have gone down more than 100 per cent. In 1913 the fall was very heavy indeed. Consols were then 75, they are now 58. Bank of England stock were then 240. they are now 116; Metropolitan Water Board, stock wore 81, and are now 63; and Corporation to London 2½ per cent. stock were 75, and are now 54. There are two classes of investors in this country. What ought those two classes to learn from this great fall which has been going on in investments? Because the sooner we try to learn these things the better. In those years, until 1913, it was not possible for the ordinary investor to find what we call short-dated stock. If you can get short-dated stock you do not meet with the same depreciation as ordinary gilt-edged stock which is never repayable.
We will divide, as I have said, investors into two classes. I will take the banks and fire insurances as the business investors. The banker may be called upon at any moment to pay across the counter all or any of the large sums of money which have been paid into his bank The fire insurance offices, again, may, owing to there being many fires, also have to pay across the counter in another sense. It is very evident to me, therefore, that the business investors, such as the banks and insurance offices, should put all their money into short-dated gilt-edged stocks and not long-dated ones, and then if they are called upon suddenly to pay money across the counter they can sell their investments without making a loss. If that had been done long ago We should have saved many millions of money. The private investor has a chance, for the first time, of buying gilt-edged securities which run for a short time and cannot depreciate. Ought he not to be satisfied with those short-dated stocks which will not go up or down? Had he not better take at least half of his money and put it in short-dated gilt-edged stocks, and keep the other, if you please, in long-dated gilt-edged stocks that will perhaps go up or down? I think these things are worth considering by all of us, as to the wisest course to pursue with regard to investments in the future.
Now I come to the railway position. This interests us very much, because

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probably we are all shareholders. The best class of investor in this country has got into rails, and I am told by a competent authority that at least 50 per cent. of the railway stock is held by small people with less than £500 in each holding. The Government have taken over the railways, and I gather from what happened in the House of Commons the other day when Sir Eric Geddes was speaking that they are going to respect the treaties of 1844 and 1871 made between the Governments of those days and the railways, to the effect that if the railways Were bought out certain fair terms Would be given to the railway shareholders. I have never heard a Word against that anywhere in the country.
I think every one is convinced that the railways have done exceedingly well during the war. The working man certainly does not want to do them any harm. He wants to pay a fair price to the railways. That is all that the shareholder asks and that he is entitled to have. The work they did was very fine indeed. A very large railway company, perhaps the largest, with which I am connected, sent 33,000 out of 85,000 men to the war. They sent 500 of their best engines, nearly 10.000 trucks, and 1,000 lines of permanent way. I am giving you particulars of only one railway. No wonder that Sir Eric Geddes in his speech in the House of Commons alluded to the "dead hand" that appeared to be on the railways now. He did not look at it in the right light. He thought it represented want of initiation on the part of the railway companies. It is nothing of the sort. They have taken our material away and under present conditions we cannot get more of it. If you care to let the railways alone and provide the material and give them back what they have supplied to the nation during the war, they will go ahead quite sufficiently.
It is an interesting feature that the capital of the railways altogether is about £1,200,000,000, and speaking in round figures they are paid nearly 5 per cent., or £60,000,000. The Government have not been able to earn that £60,000,000, though I am going to tell you how that can be looked at in another way. They have not earned the £60,000,000 dividend that we used to pay, and it has cost about £30,000,000 in addition. Some £90,000,000 goes that way. On the other hand, I
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find from a railway expert to whom I appealed—one who has kept the accounts very closely for the railways—that if the Government had been an ordinary person that ordinary person, for the services rendered to him by the railways, would have paid no less than £112,700,000. So that the Government have done very much better than the £60,000,000 a year loss would indicate. They have not done particularly well, but it is only fair to say that they have worked the railways at a net loss of £30.000,000 and not of £90,000,000.
Wages have gone up very much indeed, as we all know, and everything connected with the railways. That would very easily account for the £30,000,000. Fares are up by 50 per cent., but, funnily enough, freight rates have not been touched at all. The argument appears to be, in this as in many other things, that if you put up the freight rates you make everything very much dearer, that you make our exports much dearer and you cut us out or the markets across the seas. That may or may not be right. I think there is a good deal in it, but at the same time I suppose I have the commercial mind sufficiently to dislike even a Government trading at a big loss. I think the Government should look round and give up trading at a loss. On the whole, I think I am in favour of Sir Eric Geddes' plan. I think the railways would be much better under one umbrella than they have been fighting with one another in the past. There is a great deal of money still to be saved in the working of railways, and, although I know very little about the mechanical side of the subject, I was rather impressed by his idea of running these great, big, slashing engines that we use on the railways in the North by electric power. That might be an enormous saving. I am given to understand that heat and power save most through gas, secondly, by electricity and thirdly, by burning coal. Coal comes last. Using it in its raw state is worse than using it either for electricity or gas. Gas is best, but you cannot use that for running engines.
Now I come to a problem which is very similar—the coal problem. Here are these miners working, I suppose, at from £1 a day to 16s. a day. They work shorter hours and accordingly turn out much less coal. That is a question for foreign markets. We shall wake up some day—you may wake up to-morrow, and if there

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was nothing but trade to be considered you would wake up to-morrow—and find American coal in London in your own furnaces at 25 per cent. cheaper than you can put it there from our collieries. That is a possibility; it is a probability if we go on like this. Miners must understand that they depend, as we all do, on their diligence and hard work. They must turn out more stuff and turn it out regularly, and not upset the whole of England and the whole world by these immense strikes time after time with no finality in them. It is borne in upon me more every day that the nation with the cheapest labour and plenty of it will be hereafter the most powerful nation in the world. The only two watchwords for us in this country and for every one of us it seems to me are "Work" and "Save." You cannot say "Work" without "Save." Work, of course, is better than doing nothing at all, much better, but at the same time you should combine the two. I thank your Lordships for having listened to a rather discursive talk, but I thought it would interest you that I should speak about matters in which we as private people are interested, and therefore I ventured to intrude upon your time.
LORD BUCKMASTER: My Lords, the subject which is covered by the Motion of Lord Faringdon is very stimulating and suggestive, and it is not surprising that it caused the debate to proceed along lines that are not strictly and accurately covered by the words of the Motion. In the few words for which I ask your Lordships' indulgence I will do my best to confine myself closely and strictly to the actual terms of the Motion which is before your consideration.
Let me say at once that, while I listened with great anxiety to the speech of the noble Viscount who answered for the Government, I heard it with the most profound disappointment. I did so for this reason, that he met the grave and careful statement of the noble Lord, Lord Faringdon, with no answer, excepting the easy optimistic statement that the Government did not really think things were as bad as Lord Faringdon had suggested they might be. If debates of this kind possess any value, that value is due to the fact that opinions may be put to the test of argument, and that figures and facts may be used on each side in order that the value of various contin-
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gencies may be properly tested. Not one single word that I could find was uttered by the noble Viscount that gave any substance whatever to the expression of confident opinion which he said the Government held as to the future of our finances.
Let me ask your Lordships to consider for a few moments the financial position as it appears to me, and there is no reason whatever to put any smooth and easy interpretation upon ugly and indisputable facts. They are better stated and faced than covered over and avoided. If we go back to the year 1913, the year before the war, we go back to a period when British trade may have been said to be at the height of its activity. I do not say it is the best trade year we have ever known, but it was a good trade year. England at that moment was the indisputable centre of the money market of the world, and exchanges were in her favour all over the world. At the same time I imagine there was hardly a single country to which she was a debtor The exports and imports of the country were immense, her national wealth was vast, and was increasing. During that year the actual amount of taxable in come in this country was about £750.000,000. That is a figure which is capable of being checked. You have merely to take the Income Tax, estimate how much a penny in the £ will produce, and you get your result automatically. It was about £750,000,000, and it represented somewhere about 40 per cent., or 35 per cent., of the total national income. It is a very important figure, because the total national income being roughly £2,000.000,000—that is the entire receipts of the whole country, wages as well as interest on capital, and profits on industries—it represents all that was received in the course of all activities in one of our trading years, and £750,000,000 represents the residue of that which is the basis out of which you could extract your Income Tax. That is a very important figure, as it is exactly one half of the Estimates for the present year. I quite agree as to what has been said about changes in the value of money, and I will deal with that in a moment, but at least we can bear in mind that the present Estimates propose as our expenditure twice the total taxable income of this country before the war.
That is not all. These figures are capable of being examined in another

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way. Out of that £750,000,000 the Income Tax payer has got to live, and if you reduce down every man to a living wage of £3 a Week or £160 a year—it is not a very excessive sum, though it does appear to be just half the amount the Government have been paying for unskilled labour at the Chepstow dockyard—and accept it as a reasonable sum, you will then find the net residue of income which is the only source available for the purposes of obtaining payment of your annual expenses. That will reduce your £750,000,000 to £500,000.000. Therefore, if you take as the standard and sample year the year before the war, you find that £500.000.000 was the amount of money in the pockets of your Income Tax payers out of Which you had to levy the expenses of the State, and the residue represents the money they had for their own expenses and what may be brought over for national savings. It may be that these figures may be subject to this slight modification—that the Income Tax, as we all know, is never perfectly exact, and that the £750,000,000 may not represent all the income that ought to have paid Income Tax. You may increase it by £50,000,000 as representing evasion, tricks, fraud, and dishonesty, and if you do that you will add another £50,000,000 to the £500,000,000, making £550,000,000 as the annual amount of money our trade produced before the War to carry on our national expanses and provide for the savings and comfortable living of the Income Tax payer. It is an interesting figure, for it is one-third of the amount that is provided for our present Estimates, and—this is by far the most important criticism of all—it represents almost exactly the Civil Estimates for this year. You therefore find that the total income of the country before the war would be just sufficient to provide, for your Civil Estimates without paying a single farthing of the interest on debt, and without providing a single sixpence for naval, military, and air forces.
There is a further examination which we have to make, and it is this. What was our total national Wealth before the war? Again these things are difficult to estimate, and they are largely, I admit, a question of guess-work. But the people who guess most intelligently put it from £15,000,000,000 to £19,000,000,000; and £7,000,000,000 of that has gone. Not only has £7,000,000,000 gone but, as Lord Faber has pointed out in his most
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interesting observations, you have the greater part depreciated by 50 per cent. There is something more than that. Of the money you have taken you have taken the liquid working capital of the nation, and the residue that is left represents nothing like the same balance that you would find by merely taking seven from fifteen or nineteen and saying you have £8,000.000,000 left. You have not. It would be difficult to say the exact sum, but if there Were £5,000,000,000 free capital available after this War, taken at the standard of currency measured before the War, that would be all that there is. These are formidable considerations.
And now the war having passed by, what position do we find ourselves in with regard to earning the money that is to pay the interest on the debt, and keep the proper expenses of the nation supplied? The first thing we find is this, and it is a very important thing to my mind, that whereas the income of people here is on the whole much as it was, the character of the income has completely changed. Let me explain what I mean. I do not know the exact amount—probably Lord Faber would know—but I should think that £100,000,000 a year came to this country representing the interest on investments in the United States. Whatever it may be, I do not pin myself to the figure; it was a large and substantial sum.
LORD FABER: More than that.
LORD BUCKMASTER: I am pleased indeed that with my usual desire not to overstate my case I have understated it. It was more than £100,000,000. It was wealth that came into this country and could be used, and was used here, for the purpose of developing our own domestic industries and carrying on our trade. The men who received that £100,000,000 receive to-day £100,000,000; but from what? That asset, which was a national asset, has gone and in its place is a national debt. There stands to-day a national obligation, a debtor account, as between the State and the individual, and it is out of the profits of this nation that the State has got to provide that £100,000,000 which before the war came to us from overseas. This seems to me to be a formidable fact when you are considering what is the position of this country to-day and how it is going to provide the expenses which the Government say have to be met.

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It was stated by Lord D'Abernon that we have got our basis all wrong because our money value has depreciated. I agree. Supposing that you take the figure that he suggested, and said that it had depreciated by 10 s. in the £, and you therefore took the normal income of the country before the war and doubled it. You still would not get anything like enough to carry on the government of this country at the present extravagant rate. I find myself unable to understand how in the face of facts and considerations like these the noble Viscount who was put up to answer the criticism on the part of Lord Faringdon and Lord D'Abernon can have said, "Oh, the Government does not really think the thing is as bad as you say it is," and pass away to another matter.
There is something that is even more grave than what I have stated—facts we all know. The only possible way in which we can meet the position is to revive and stimulate our domestic industries. And what do we find? Do we see any sign of their revivification and their re-stimulation? The papers tell us day after day that in every trade centre things are as bad as they can be, and the business men attribute it to the fact that they do not know where they stand with regard to the future, that Government control has so embarrassed them, that the system, as it stands even now with its limited restriction in the case of imports and trade licences, creates difficulties, and that they have not the courage to take in hand big orders because they do not know that if they fix them on to-day's prices what may happen in six weeks' time. That is a matter I submit which it is vital for the Government to take in hand. Cannot they get rid of these trade restrictions? The noble Viscount said some people fall into the error of imagining that there is peace, and he went on to explain that it would not matter if we were to fall into such an error, as the expense after peace, as far as I understand, was to be greater than before the war.
What we say is this. In point of fact hostilities ended on November 11, and, though peace is not yet declared, we find ourselves quite unable to see how the declaration of peaca can, per se, produce any reduction in the expenditure we see going on. We are not at all satisfied with the statements that have been made on behalf of the Government that there
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are a number of matters connected with the big Departments in which contracts have to continue, and that this has involved abnormal expenditure. If that be true—and I have no doubt it is true—and if it be the real explanation of a considerable part of this expenditure, all I can say is that the Government are gravely to blame; because no big spending Department ought to have entered into large forward contracts for the supply of materials or of goods of any kind while the war was on without making a great provision in case of the declaration of peace. The only way in which honest finance could ever have been met would have been to take that course.
Nobody supposed the war was going on for ever, and peace had to come, and if big contracts were going to be made six months or nine months ahead—and they were made, four, five, and six months ahead—and no steps were going to be taken to secure you against a claim for damages if you did not continue to take the things which the cessation of hostilities had made absolutely valueless, all I can say if a graver neglect to the nation than that it is very difficult indeed to find. For the rest the explanation that was given by the noble Viscount of our Civil Estimates alone—and I have not touched the others—left me no confidence whatever that we were going to be faced with any material reduction in the coming years. But if a reduction is going to take place it must be something far more than a reduction on one or two of the large items that he mentioned. It has to be a reduction that will reduce our total estimates down to a figure that we can pay, and at the same time live. The danger that I see is this. There are a number of people in this country at the present time who are distinctly interested in Government extravagance.
Several NOBLE LORDS: Hear, hear.
LORD BUCKMASTER: Those are not the only people who are profiting by it. There are other people who realise quite well that if the Government can only be driven on to further and further extravagance they will achieve their aim, and their aim is the complete destruction of the present capitalistic basis of society and the substitution of something else. We should make a great mistake if we did not know that those ideas are in the minds of some of the more extreme and unreason-

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able men who are responsible for some of our difficulties. I know they are there, and if the Government continue as they have done in the past to spend without regard, as far as I can see, to the question of payment, they will play into the hands of these men.
There is one way, and to ray mind one way alone, by which the present position can be met. Lord Faringdon stated that suggestions might be made, and I make a very humble one. It is this. There should be a Committee appointed of the most capable men that you can find, and they should tell you, having regard to the whole position, what is the total maximum amount that this country can pay for all the expense of Government and continue to survive? When that figure is fixed Estimates should be forced within its compass. It is wrong to begin by letting each Department estimate for what it wants. You must find out what the nation can afford, and let the Departments measure their payments according to that necessity.
Several NOBLE LORDS: Hear, hear.
LORD BUCKMASTER: The next thing is this. The Government, I submit respectfully, must cease borrowing. The mischief of depreciation is at the bottom of the trouble that we have had with regard to the price of commodities and with regard to labour. These difficulties are all due to this excessive borrowing, and, though it was one of the things that may have been incident to the war, it should be stopped and should be stopped now. The reason is clear. We know what happens. An account was given recently by the noble Lord, Lord Hylton, of the amount of Treasury Bills that are outstanding. They wore £967,000,000. That figure was given again to-day in The Times newspaper. What do those Treasury Bills represent? As I understand it they represent this. The Government, wanting money and not being prepared to float a loan or to issue further bonds, go to the Bank of England and issue Treasury Bills to the Bank of England, and get credits in their books against which they can draw. Treasury bills are then held by the Bank of England as security for this overdraft. Of course, strictly speaking, it is no security at all, but it is a convenient negotiable document, and the liability of the Government for the over
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draft is just the same. The result is there is a Treasury bill which may be used in commercial circles, and may soon have to be met. As soon as you have got this credit you begin to make the extra payments that have to be made by reason of your increased expenses. How do you meet it? It is the simplest thing in the world. You call in the printing press, and print the money to meet it, and by this means you get your currency inflated from time to time, and it cannot fail to be otherwise. If you want to restore your currency on a sound foundation borrowing must be stopped, and, I submit, above all, this method of borrowing by going down to the Bank of England and getting overdrafts and giving Treasury bills as security for the same.
We are all of us deeply, intimately concerned in this question, because we believe—those, I know, with whom I have the pleasure to sit, and whose opinions I have the privilege to share—that at this moment the question of how we are going to regulate our finances at home is just as important for this country as it was last year to know how we were going to conquer our enemies abroad. And we believe that in both cases the future of the country depends upon the successful solution of the problem. I regret greatly that things have been done by the Government which I think must permanently impair our credit at home. I think they will find it increasingly difficult to borrow money owing to acts for which they themselves are responsible. I saw myself upon the walls in one of the suburbs large notices issued in January, "War Bonds withdrawn on January 28." There was no qualification, no reserve; people were being urged and stimulated to buy War Bonds upon the faith of a promise made by the Government that they were going to be withdrawn on January 28. On January 28 they were withdrawn, and within a fortnight they were, re-issued in conditions almost indistinguishable from the conditions attaching to the ones that had been withdrawn. The next time that that notice is put upon the walls, is it very likely that the people will believe it?
I think it is a grievous and a lamentable, thing that the Government have been compelled in some of their courses to adopt the less reputable methods of commercial activity, and to advertise as facts things that will not bear strict investigation.

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They have, I think, done something more, they have stimulated the minds of people with hopes that can never be realised, and they have flattered their ears with promises that will never be fulfilled. Until the mischief of that is done away with we shall have industrial trouble at home. and. whatever peace we may make abroad, our peace will be ineffectual unless that trouble can be overcome.
THE SECRETARY OF STATE FOB THE COLONIES (VISCOUNT MILNER): My Lords, I was rather led to believe that other speakers were wishing to address the House, and in that case I should have been glad to reserve the observations which I may make on this subject to a time when I should have had a little more opportunity of examining closely the important speech which has just been delivered. It is not an easy speech to criticise at a moment's notice, but nevertheless I feel that it is open to answer in many respects, and that an answer is called for.
I should like to say in the first place, if the noble Lord will forgive my saying it with regard to the tone of that speech, that when he went on piling up figures of the indebtedness of the country—all of which was the direct consequence of the war—he could hardly be thinking or desiring to make that a reproach to the Government. The debt was incurred by the same methods and for absolutely the same purposes by successive Governments, and, whoever had been in power to-day, not only would that Government have had to bear the burden of the expenses of the war but they would have found, as we find, that it is perfectly impossible, do what we will, in the present condition of the world to get rapidly and at once from enormous war expenditure to anything like normal peace expenditure. There has been a storm such as has never been in the history of mankind agitating the waters of the world, and though the storm may have passed—I hope it has entirely passed—the breakers which it has raised will continue to roll against the shores for months and months after the wind has subsided. That is inevitable.
I think the noble Lord was under the impression that the Government regarded lightly the financial position in which the country finds itself. I can assure him that there could not be a greater mistake than that. We are perfectly alive, every
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one of us, to the gravity of the situation; but on the other hard it is not going to help us to get over our difficulties to exaggerate them and to represent to all the world that this country is in a state far worse, far more desperate, than is really the case. Ann also, while it is no doubt dangerous to treat too lightly the financial difficulties in which we find ourselves, it is equally mischievous and unpatriotic to make out the position of this country worse than it is.
I believe that the picture which the noble Lord has drawn—I am sure he has done it in all sincerity—is an extremely exaggerated one, but when I say that I must beg the House not to consider that I say it with any view of depreciating the necessity for the greatest care and for all reasonable economy at a time when undoubtedly the national finances are severely strained. I cannot follow the noble Lord through all his figures, but there are one or two that really are of such a surprising character that I should like to call attention to them. He seems to think that the amount of our National Debt is an absolute deduction from the total wealth of the country.
THE MARQUESS OF SALISBURY: Of course, it is.
VISCOUNT MILNER: The noble Marquess says, "Of course, it is." I entirely dispute that position. The contention is that the country Was Worth, taking it broadly, between £15,000,000.000 and £19,000,000,000 when the war began, that it has contracted a debt of £8,000,000,000, and therefore, assuming that there was no change in the value of money, Great Britain and Ireland would be worth about half to-day what they Were worth four and a half years ago.
LORD BUCKMASTER: I put that at £7,000,000,000.
VISCOUNT MILNER: Does anybody really believe that? Does anybody really believe that the true valuation of the country would show a reduction of something like 40 per cent, to 50 per cent, as compared with the true valuation when the war began? I believe it is a complete fallacy.
LORD CLIFFORD OF CHUDLEIGH: I believe it is £90,000,000,000.
Several NOBLE LORDS: Order, order!
VISCOUNT MILNER: The real loss must be represented by something tangible. Is it the land of the country plus its factories which are less valuable than they were? The factories are actually much more valuable; the machinery is more valuable. There is a certain amount of depreciation in regard to some things—the railways and rolling-stock; but I doubt if the total loss in this country itself amounts to £1,000,000,000. I am not certain that there is any loss at all, and that the set-off in improved machinery and factories may not outweigh it. Of that, however, I cannot speak positively. But to say that the depreciation in the value of this country as a going concern is anything like £6,000,000,000, because £6,000,000,000 had changed hands in this country from one set of people to another set, is to my mind a complete, radical fallacy. I will grant the noble Lord this—namely, that there is one undoubted and heavy and very serious loss, the foreign investments with which we have had to part. That is a dead loss. But the debt which has been created in this country is not a dead loss at all in the sense that those foreign investments are a dead loss. The effect of the creation of a debt in this country is principally the transfer of a certain amount of income from one set of hands to another set—a very serious matter indeed.
LORD BUCKMASTER: Surely the difference is this, is it not, that industry-is now charged with the annual outgoing on the debt of £350,000,000 and it was not charged with it before?
VISCOUNT MILKER: That is perfectly true. But there is not a depreciation in the value of the country as a going concern to the extent—well, we had, perhaps, better not pursue the subject. But I maintain that the real loss which the country has sustained by the war is the loss of its foreign investments plus any damage the plant of this country may have sustained during the war, and that it cannot in any way be measured by the figure of our National Debt. The growth of the National Debt is undoubtedly a very serious factor; it is an enormous embarrassment to the Government; it is a tremendous displacement of the national wealth and resources; but it is not, in so far as it is
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held in this country, a reduction of our real wealth. That is the point I wish to make.
VISCOUNT MIDLETON: May I ask the noble Viscount whether he includes the enormous sums spent in America and elsewhere abroad which have gone out of English hands?
VISCOUNT MILNER: Yes, of course we have spent on war a great deal of money which we would otherwise have spent for the purposes of peace. To that extent we have all been the poorer. But the noble Lord seems to forget that a, very large amount was being defrayed out of taxation. However, I will not pursue that subject any further, and I do not wish to overstate things.
The point I wish to make is this, that we are exaggerating the diminution of the capital value of this country; and the importance of this is that, as I believe, our effective capital—that is to say, our productive power—is not nearly so seriously diminished as the noble Lord represents. There is a way out for us by means of increased production, and it is the only way out to reduce the burden which the war has put upon us. If I am wrong in the view I take of the effect of the war upon the national resources, I think the result would be an enormous decrease in the national income. I do not think the noble Lord himself contends that there is a decrease in the national income, though he says the amount of income available for taxation is hardly sufficient to meet it. I would again point out to him that what this means is—and it is a very serious thing indeed for a very large class of the people—that there is an immense transfer of wealth from one set of the community to another. I think, however, that as the old Income Tax-paying class becomes poorer (as it is undoubtedly becoming poorer), there are obviously other classes which are increasing in wealth and passing within the range of the taxable. I do not think there can be any question that the total taxable income of the country is as great if indeed it is not greater than it was before the war. Even if it is not greater to-day, the moment industry returns to its normal, or, as I hope, to increased activity, the taxable capacity will materially increase.
I do not want in the least to give the impression that the problem of how the

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Government is to meet its liabilities is not, as the noble Lord truly said, perhaps the greatest problem We have to deal with to-day. It Would certainly be if we could feel that the peace of the World was fully established. Feeling, as I do, chat we are still far from certain and well-established order in the world, I think we are justified in at least one of our Estimates, and that is the Estimate for the purposes of national defence. It shows an immense reduction of the Estimate of last year, and an immense reduction on what I believe anybody a year ago would have estimated to be our national expenses, but it is still immensely heavy. I do not think it would have been possible reasonably to have further reduced that expenditure. The other great item which is within the control of the Government is the item for Civil services, because of course the interest on the debt accumulated by successive Governments for the pursuit of a single national end is beyond our control. The only Estimates we can control are the Estimates for defence and for Civil services. So far as the Estimates for the Army, Navy, and Flying Corps are concerned they are governed by those considerations to which I have just referred. I hope we have not taken too sanguine a view of what might be required in that respect. I am perfectly certain that we, should not have been justified in taking a more optimistic view, or in reducing more rapidly than we have done the defensive powers of the country. I am absolutely convinced of that, and I only hope that the day may not come when we may feel that we have reduced them too rapidly.
There remain, of course, the large items of Civil Service expenditure to which such constant reference has been made to-day. I did not notice the exact words, but I think the noble Lord used expressions implying that there was no indication of the items on which We thought that expenditure could be reduced. But surely the noble Lord has not looked at the details of the Estimate. Possibly this Paper has not been circulated—
LORD BUCKMASTER: I have seen a copy of it.
VISCOUNT MILNER: The biggest figures here are obviously figures belonging to the transitional period in which we are. The largest figures are for loans to the
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Dominions and Allies, £87,000,000, and obviously that is a figure which in time of peace will entirely disappear. Then the bread subsidy figures at £50,000,000. I do not suppose anybody anticipates that in a year of peace there would be any bread subsidy at all. I do not wish to go over all these items, but I think I can easily show that in the first year of peace the reduction in Civil Service estimates is bound to be something like 50 per cent., and even more. A year ago we were thinking that this year might probably still be a year of war. That is an answer among other things to the criticism made by the noble Lord, that we should have foreseen the possible early termination of the war contracts. The war did, fortunately for all of us, come to a somewhat unexpected conclusion. I do not believe there was anybody in the warring countries who last July or August believed the war would be over last year. A year ago we were looking forward to an expenditure of £3,000,000,000 in this financial year. We had contemplated and were fully prepared for it. The country was prepared to go on spending £3,000,000,000 for even another year. Owing to the termination of the great struggle that expenditure has dropped to £2,000,000,000. We contemplate next year a fall to £1,500,000,000. That is a fall of 50 per cent, in the transitional year. In the following year, assuming the world to return to a state of order, I think we may anticipate something like another 50 per cent. drop. It leaves the country no doubt with an enormous burden to bear, but not a burden which there seems to be any reason to suppose it cannot bear or the seriousness of which should be exaggerated.
The noble Lord concluded his speech with two propositions, with one of which I heartily agree. He took the view that it was desirable to have a Committee of the best experts that could be found to enquire what really was the maximum bearing capacity of this country in the way of taxation. I am speaking for myself personally, but I should gladly welcome an inquiry of that kind, made by trained and impartial economists. Another proposal which he made, which I think is more disputable, was that there should be an absolute and immediate, cessation of borrowings. The sooner we can stop borrowing the better, and we are ill most anxious to do so, but I think we can no more stop borrowing instantly, in a case of this kind

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and after such a financial experience as we have had during the last few years, than you can demobilise instantly. The passage from war conditions to peace conditions is bound in any case to be a gradual one, and I think we are moving as fast in that direction as is really wise. I am sure it would be a mistake, vitally important as it is to avoid any waste, to lay down a hard and fast rule of that kind, because borrowing fresh expenditure even on a large scale may be absolutely essential to that increased productivity which the noble Lord himself admits, and which we all admit, is the only ultimate way out of our troubles.
I would like to give him an instance out of my own experience. At the time when Egypt was crushed by the burden of her debt to such an extent that the interest had to be funded and a new loan raised to meet this accumulated interest which Egypt could not pay. Lord Cromer insisted—and he; succeeded in the teeth of the violent opposition of financiers—upon adding a certain sum of new money to the debt created by the funding process. People said "Here is Egypt absolutely a bankrupt and unable to pay the interest on her present debt, and wants to borrow more." The noble Lord who made so interesting a speech to-night on the value of money, will remember the circumstances because, I believe, he was himself concerned in the transaction. I venture to say that there never was a more profitable investment of money than that additional borrowing which was made at the very moment when Egypt was so impoverished that everybody thought the one necessary, right thing to do was to stop all fresh expenditure, certainly to stop all fresh borrowing.
There are other forms of waste than those which are represented by £ s. d. I believe the greatest waste of all in this country is the wasteful system of production and distribution in some of our principal industries, and I believe that the greatest waste to-day is perhaps in the way we use, or misuse, our electric power. It is quite conceivable to my mind that the expenditure of £40.000,000 or £50.000,000, or even a larger sum which might have to be borrowed, for some great industrial improvement, some great improvement in our method of production, might pay itself back cent, per cent, just as the famous million of Lord Cromer's
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which he borrowed as fresh money when Egypt was actually in bankruptcy. Certainly it paid itself back more than cent, per cent. I am not advocating fresh borrowing, but I am saying that in my opinion it would be a fatal mistake and a radical financial error to say that, because we have got this enormous burden of debt, we should draw a hard and fast line and say we should not borrow henceforward for any purpose whatever.
Remember that if the war had been going on we should have been borrowing merrily, as we were right through the war. We should have been borrowing this year, perhaps, £2,000,000,000. Well, a country which can afford to borrow £2,000,000,000 a year for several years for the purposes of war and destruction must not be debarred, even in its present difficult financial position, from borrowing far smaller sums for the purposes of production, always provided that there is reasonable ground for supposing that they will bring a substantial return. I am all for the greatest possible economy, but the economy which is most important of all to my mind is the economy of efforts, economy of national energy, and if, by any further capital expenditure, we can make our national effort more productive and make better use of our still, in some ways, greatly undeveloped national resources, I think we should be making a great mistake to let ourselves be deterred from undertaking it, even by the contemplation of the heavy financial burden which we have to bear.
VISCOUNT MIDLETON: My Lords, I beg to move that the debate be now adjourned.
Moved accordingly, and, on Question, Motion agreed to, and debate adjourned accordingly.
THE MARQUESS OF SALISBURY: My Lords, I do not think the Question was put from the Woolsack as to the day to which the debate should be adjourned. That will have to be mentioned.
THE CHANCELLOR OF THE DUCHY OF LANCASTER (THE EARL OF CRAWFORD): My noble friend Lord Milner paused before speaking, and I understood that he was the last speaker as nobody else rose. I will consult as to the day on which the debate should be resumed.
THE MARQUESS OF SALISBURY: There is no criticism of my noble friend. I only suggest that we should have it regularised for the convenience of the House.
THE EARL OF CRAWFORD: It takes me by surprise. I did not know that the debate was going to be adjourned.
THE MARQUESS OF SALISBURY: I suggest that the debate be adjourned until Monday.
THE EARL OF CRAWFORD: I would rather have notice.
THE MARQUESS OF SALISBURY: Shall I leave it in the noble Earl's hands?
THE EARL OF CRAWFORD: I am, as I have said, taken by surprise. My noble friend Lord Milner paused to see if any other noble Lord wished to speak, and nobody rose. If I may, I should like to consult about the actual day for resuming the debate.
THE MARQUESS OF SALISBURY: Certainly.

THE CASE OF MISS PENNANT.
LORD AMPTHILL LORD AMPTHILL rose to ask His Majesty's Government—

1. What has happened about the promised inquiry into the circumstances of the dismissal of Miss Violet Douglas Pennant from the Women's Royal Air Force, and when the inquiry will be held.

2. Whether the Report of Mr. Cecil Harmsworth recommending a judicial inquiry into the case of the dismissal of Miss Violet Douglas Pennant can now be laid upon the Table of the House.

3. Whether they will communicate to this House the full text of the letter, dated the 6th September, 1918, which, according to the Parliamentary Under-Secretary of State for Air, was written by Lord Weir to Miss Violet Douglas Pennant, and to inquire whether that letter was ever despatched.

The noble Lord said: My Lords, I propose to act on the suggestion made by the noble Earl the Leader of the House, and merely
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to ask my Question without any further explanation, but I hops that in the circumstances I shall get a plain answer to a plain question, as otherwise it would be impossible to pursue this method. I therefore beg to ask the Question which stands in my name.
THE PARLIAMENTARY UNDERSECRETARY OF STATE FOR AIR (THE MARQUESS OF LONDONDERRY): My Lords, I think the noble Lord must be under some misapprehension, because I had some correspondence with him yesterday in which I asked him if he would be good enough to postpone his Question until Monday, when I should be quite happy to give him an answer. I am afraid that the letters I Wrote him must have miscarried. If he will agree to the request I made to him to postpone his Question until Monday, I shall be glad to give him the reply that he asks.
LORD AMPTHILL: May I reply to the noble Marquess? The letters have not miscarried. I received a letter from the noble Marquess asking me to postpone my Question, but as he gave me no reason I replied that I could not see my way to do so. I was naturally not going to be taken in by any of the camouflage to which we are accustomed.

INCREASE OF RENT AND MORTGAGE INTEREST (RESTRICTIONS) BILL.
Returned from the Commons, with certain of the Lords Amendments agreed to, and certain of the Lords Amendments disagreed to.
THE EARL OF CRAWFORD: It is suggested that the Commons Amendments to the Lords Amendments to this Bill should be taken to-morrow.
THE MARQUESS OF SALISBURY: I see no reason why that should not be done. I do not know in what order the Government propose to tab; business to-morrow, but I presume this would come at the end of business. I hope the noble Earl will not think that I desire to be inconvenient, but it might happen that the debate on the Motion which stands in the name of Lord Desborough might be carried on so late that it might be inconvenient to take the Commons Amendments then. In those circumstances we might perhaps properly ask the Government not to take the Amend

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ments supposing the other debate should be prolonged. It is obvious that the important debate on what I think is called the "Slough Scandal"—
THE EARL OF CRAWFORD: "Government works at Slough."
THE MARQUESS OF SALISBURY: Yes; "Government works at Slough"—it is possible that that debate may last very late, and in that case perhaps the Government will keep an open mind on the point as to taking the Increase of Rent Bill.
THE EARL OF CRAWFORD: Lord Desborough's Motion was put down a good many days ago, and I am sure it would be inconvenient to him if the debate were postponed. I understand that there are a number of noble Lords who desire to take part in it. I am not so much frightened about Lord Desborough's Motion as I am about the Motion which follows it, in the name of Lord Parmoor, dealing with conscientious objectors. The Duke of Marlborough's Motion with regard to Papers on agricultural matters has been put off until some time in April. I would like to suggest that we should do our best to take the Rent and Mortgage Interest Restriction Bill to-morrow. I am quite sure that we shall be able to get through the two Motions in time to enable the House to deal with this Bill as well. Important as both these Motions are they are general and not specific in their terms, as no question of date is involved.
THE MARQUESS OF SALISBURY: Perhaps the noble Earl will allow me to communicate with him privately on the subject, if there is any difficulty?
THE EARL OF CRAWFORD: I am reminded that there is no Judicial business to-morrow, and if your Lordships care to sit at 4 o'clock I will make a Motion to that effect.
THE MARQUESS OF SALISBURY: No notice having been given, that course might be very difficult for noble Lords who are coming from the country and who are
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anxious to attend the debate on Lord Desborough's Motion. If the noble Earl will allow me to communicate with him, if there is anything else to be said, I should consider it a great honour.
THE EARL OF CRAWFORD: I will move that we adjourn until the normal hour to-morrow, and I hope that expedition with regard to the debate on Lord Desborough's Motion may enable us to complete all the Orders on the Paper.
Moved accordingly, and, on Question, Motion agreed to.

PRIVATE BILLS.
[From Minutes of March 24.]
HARTLEPOOL GAS AND WATER BILL. [H.L.]
  LEGAL AND GENERAL LIFE ASSURANCE SOCIETY BILL, [H.L.]
  The CHAIRMAN OF COMMITTEESinformed the House that the opposition to the Bills was withdrawn: The Orders made on the 27th of February last and the 6th instant discharged, and Bills committed for Tuesday the 1st of April next.

REPRESENTATIVE PEERS OF SCOTLAND.
The LORD CHANCELLOR acquainted the House that the Clerk of the Parliaments had received (by post) from the Lord Clerk Register of Scotland, and had laid upon the Table, Minutes of the meeting held on the 20th of December last of the Peers of Scotland for the election of their representatives to sit and vote in the ensuing Parliament of the United Kingdom; and also, return by the Lord Clerk Register of Scotland concerning titles of peerages called at the said meeting in light of Which respectively no vote had been received and counted for fifty years last past as at the date of the said meeting.
Ordered, that the said Minutes of election, &c, be printed.
House adjourned at fifteen minutes before eight o'clock.