Sitting of 12 February 1930

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

PRIVATE BUSINESS.
Dartford and Purfleet (Thames) Tunnel Bill (Certified Bill) (by Order),
Second Beading deferred till Wednesday next.
Milford Haven Urban District Council (Water) Bill (Certified Bill) (by Order),
Read a Second time, and committed.
Ordered,
"That it be an instruction to the Committee on the Bill that the Trawler Owners' Association, Limited, the Milford Haven Ice Company, Limited, and Brand and Curzon, Limited, be allowed to appear by counsel, agents, and witnesses upon the allegations contained in the Petition which they have presented against the Bill."—[Mr. Womersley.]
Rothesay Tramways and Omnibuses Order Confirmation Bill [Lords],
Read a Second time; and ordered to be considered To-morrow.

ORAL ANSWERS TO QUESTIONS.

  AMBASSADORS' CONFERENCE.
  Mr. MANDERasked the Secretary of State for Foreign Affairs when the Ambassadors' Conference last met; whether it is still functioning; and, if so, what duties it performs?
  The SECRETARY of STATE for FOREIGN AFFAIRS (Mr. Arthur Henderson): The Ambassadors' Conference last met on the 18th of January. It still meets on very rare occasions to deal with minor questions of a technical nature arising out of the execution of the Treaties of Peace.
  Mr. MANDER: Would it not be possible for the work of the Ambassadors' Conference to be taken over by the Council of the League?
  Mr. HENDERSON: That is a matter which I shall have to look into.

  BRITISH LEGATIONS, BERNE AND BANGKOK.
  Mr. SMITHERSasked the Secretary of State for Foreign Affairs whether extra work is imposed on the members of the British Legation staff at Berne owing to the fact that Switzerland is the headquarters of the League of Nations; and has the staff there been increased of late?
  Mr. A. HENDERSON: No appreciable addition to the volume of work at the British Legation at Berne is involved by the fact that the headquarters of the League of Nations are at Geneva. No increase of the staff has taken place in recent years.
  Mr. SMITHERSasked the Secretary of State for Foreign Affairs what is the number of the personnel at the Legation at Bangkok?
  Mr. A. HENDERSON: In addition to His Majesty's Minister, there are at Bangkok a Consul-General, three Vice-Consuls, two student interpreters and an archivist. Four native clerks and a number of native messengers and watchmen are also employed at the Legation.
  Mr. SMITHERS: Can the right hon. Gentleman tell the House whether the senior members of the staff are British subjects or not?
  Mr. HENDERSON: I am afraid that I cannot.

  LEAGUE OF NATIONS.

    ARMAMENTS (PUBLICITY).
    Mr. MANDERasked the Secretary of State for Foreign Affairs whether that part of Article 8 of the Covenant of the League of Nations under which the members of the League undertake to interchange full and frank information as to the scale of their armaments, their military, naval and air programmes, and the condition of such of their industries

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    as are adaptable to warlike purposes, has been fully carried out by all members; and, if not, what the position is?
    Mr. A. HENDERSON: His Majesty's Government, together with other Governments members of the League, are endeavouring to negotiate at Geneva a general convention for the reduction and limitation of armaments. The intention is that this convention shall provide for the completest possible publicity in regard to the armaments of each country. There is also in existence a draft convention on the manufacture of arms, which would cover a good deal of the ground. There are, however, difficulties in the way of acceptance of this latter, convention pending agreement on the general disarmament convention. As the hon. Member knows, every effort is being made to make progress with the general convention. In the meanwhile, the Armaments Year Book, issued at Geneva, affords relatively full information in regard to the armaments of all States.
    Mr. MANDER: Do I understand from that answer that up to the present time the obligations of different countries under that Article have not, as a matter of fact, been carried out?
    Mr. HENDERSON: I am afraid that that is so.

    MACEDONIA (BULGARIAN POPULATION).
    Mr. CHARLES BUXTONasked the Secretary of State for Foreign Affairs whether a petition addressed to the League of Nations on behalf of the Bulgarian population resident in Macedonia has been forwarded to His Majesty's Government by the Secretary-General; whether he is aware that this petition was presented by two prominent citizens of Macedonia itself, and demands that the clauses for the protection of minorities included in the treaty of St. Germain-enLaye of 10th September, 1919, shall be applied within the framework of the Yugoslav State as at present constituted; and whether he will take steps to secure that consideration is given by the Council of the League thereto?
    Mr. A. HENDERSON: The Secretary-General has not as yet forwarded a copy of the petition in question to His Majesty's Government. Copies have, however, been received both from its
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    authors and from His Majesty's Minister at Sofia. The petition will be dealt with in accordance with the ordinary procedure of the League, and I can express no opinion thereon unless and until it comes before me in my capacity as a member of the Council.
    Mr. BUXTON: Will the right hon. Gentleman bear in mind that previous petitions dealing with this matter have emanated from exiles outside the country itself, but that what gives this petition its special significance is that it is directly representative of the minority in the country?
    Mr. HENDERSON: I will bear that fact in mind.

    TURKEY.
    Mr. MANDERasked the Secretary of State for Foreign Affairs if he is prepared to use the good offices of the Government to endeavour to persuade the Government of Turkey to apply for membership of the League of Nations?
    Mr. A. HENDERSON: While His Majesty's Government would, of course, be glad to see Turkey make application for admission to membership of the League of Nations, the question whether, and if so when, such application should be made, is one which only the Turkish Government can decide.

  OTTOMAN LOAN.
  Mr. TURTONasked the Secretary of State for Foreign Affairs whether his attention has been drawn to the proposal of the Turkish Government to abstain from payment of interest on the Ottoman Loan for a period of five yea as in defiance of the agreement the Turkish Government concluded with the bondholders in February, 1928; and whether he will make representations to the Turkish Government, in protection of the interests of English bondholders, requesting that Government to fulfil the obligations of the agreement?
  Mr. A. HENDERSON: I have seen such reports in the Press; but I have not yet received any official information on the subject.
  Mr. TURTON: Will the right hon. Gentleman state whether the rumoured proposal of the Turkish Government is a result of advice from the Secretary of State for War?

  TRADE AND COMMERCE.

    TARIFF TRUCE.
    Sir KINGSLEY WOODasked the Secretary of State for Foreign Affairs if he has made any representation to the Government of the United States concerning the proposals of the British Government for a tariff truce?
    Mr. A. HENDERSON: The answer is in the negative.
    Sir K. WOOD: Has not the reply of the United States reached the right hon. Gentleman through the League of Nations saying that they cannot usefully participate in these proposals or join a conference?
    Mr. HENDERSON: No, I have not seen such a reply.
    Mr. ARTHUR MICHAEL SAMUEL: What is the good of participating in this proposal in view of the fact that leading commercial nations of the world have decided to have nothing whatever to do with it?
    Mr. HENDERSON: I think that that question has already been answered by the President of the Board of Trade.
    Mr. DOUGLAS HACKINGasked the Prime Minister whether he will give an undertaking that any provisional agreement relating to a tariff truce will not be ratified without the approval of both Houses of Parliament?
    The PRIME MINISTER (Mr. Ramsay Mac Donald): I would refer the right hon. Member to the answer which I gave on Monday last in reply to a question to the hon. Member for Horncastle (Mr. Haslam).
    Mr. HACKING: Will the Prime Minister send me a note of it?
    The PRIME MINISTER: I shall be very pleased to send a copy of it to the hon. Member.
    Mr. HACKING: Is the right hon. Gentleman in a position to say "Yes" or "No" to the question?
    The PRIME MINISTER: Yes, but not to repeat it ad lib.

    EMPIRE MARKETING BOARD.
    Sir HILTON YOUNGasked the Under-Secretary of State for Dominion
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    Affairs whether any information is available as to the monetary return upon, or other positive results of, the expenditure of the Empire Marketing Board on posters?
    The UNDER-SECRETARY of STATE for DOMINION AFFAIRS (Mr. Lunn): The Empire Marketing Board's publicity activities, including posters, are not of a character which makes it possible for any estimate to be made of their direct monetary returns or other positive results. The Board have, however, substantial evidence from the Press, the public and trade interests at home and overseas that their posters are an advantageous instrument of their policy of creating a background of interest in the subject of Empire buying.
    Mr. BOOTHBY: Can the hon. Gentleman not do something, or use his influence in some way, to see that these posters are made comprehensible?
    Mr. LUNN: I will take the hon. Member's question into consideration.
    Mr. HURDasked the Under-Secretary of State for Dominion Affairs the proportions of Empire Marketing Board expenditure which have been directed to encourage British home and overseas Empire production, respectively, and the general character of the grants?
    Mr. LUNN: The larger part of the Board's expenditure on publicity is intended to be in the general interest of Empire production both at home and overseas. Similarly, in nearly all cases the research work has an important bearing on problems arising both at home and in one or more oversea parts of the Empire. The general character of the grants made is set out in the Board's last Annual Report, a copy of which I am sending to the hon. Member.
    Mr. HURD: Is the hon. Gentleman convinced that the home producer is getting a fair "how in the work of the Empire Marketing Board?
    Mr. LUNN: As far as I am informed, and as far as I have gone into the question, I think there is no reason for com-plaint by the home producer.
    Mr. HAYCOCK: Can the hon. Gentleman say whether the Dominions and Colonies are reciprocating in this matter,

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    and whether there are posters on their hoardings asking that British goods should be bought there? Is it reciprocal?
    Mr. LUNN: I do not think there is any doubt, as far as the overseas parts of the Empire are concerned, that they are as much interested as we are.
    Mr. HAYCOCK: But may I ask whether they spend money as we are spending money here—whether Government money is being spent by the Dominions to advertise British goods?
    HON. MEMBERS: Answer !
    Mr. LUNN: I am not called upon to answer a question of that sort, which is one for the Dominion Governments.
    Commander BELLAIRSasked the Under-Secretary of State for Dominion Affairs why the Empire Marketing Board exhibited at their free cinema a film of life on board the American liner "Leviathan"; why no application was made, in the first instance to the Great British Atlantic steamship companies; and whether he will draw the attention of the Empire Marketing Board to the fact that the statement shown on the screen that the "Leviathan" is the largest ship in the world is not accepted by the owners of the "Majestic "?
    Mr. LUNN: I am informed by the Director of the Imperial Institute, who manages the cinema in question on behalf of the Empire Marketing Board, that this film was only exhibited after application to the usual source of supply had failed to elicit a suitable film of British shipping available for free display. The publicity given to the subject has now indicated that British shipping films are obtainable, and the film in question will not be exhibited again at the Imperial Institute. I will draw the attention of the Empire Marketing Board to the point made in the concluding part of the question.

  CHINA (NANKING).
  Sir K. WOODasked the Secretary of State for Foreign Affairs whether he can state the present position of the negotiations at Nanking, particularly as regards the future of the Provisional Court?
  Mr. A. HENDERSON: The delegates appointed by the Chinese Government and the Ministers of the interested Powers reached on the 21st January a draft agreement abolishing the former Provisional Court and system of Consular Deputies and providing for the establishment in place thereof by the Chinese Government of a District Court and Branch High Court to exercise jurisdiction over Chinese in the International Settlement I have not yet heard whether all the Ministers concerned have accepted and are prepared to sign the Agreement. His Majesty's Minister has been authorised to do so. As regards extra-territoriality, I have, it present, nothing to add to the reply given to the hon. Member for Willesden East (Mr. D. G. Somerville) on the 5th February.
  Sir K. WOOD: Would it be possible for the right hon. Gentleman to make available in the form of a White Paper or by some other means the Agreement which is proposed, having regard to the importance of this information to British subjects?
  Mr. HENDERSON: When the whole of the negotiations have been completed, I will consider the issuing of a White Paper.
  Sir K. WOOD: Does not the right hon. Gentleman think that it is only right that the House should be informed now inasmuch as he has authorised, I understand, our representative there to sign this Agreement?
  Mr. HENDERSON: I think that my experience of this House would show that that is entirely a new Procedure.

  RUSSIA.

    DEBTS, CLAIMS, AND COUNTER-CLAIMS.
    Sir BASIL PETOasked the Secretary of State for Foreign Affairs (1) whether the Soviet Government has presented a schedule of Russian counterclaims to the claims of His Majesty's Government;
    (2) whether, in presenting British claims against the Soviet Government, he will see that the claims of British subjects for bonds and other Russian securities are separate from the schedule of Government claims; and whether, in preparing the schedule of the claims of

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    British subjects, he will see that it is prepared in consultattion with the British Union of Russian Bondholders;
    (3) whether the Government have prepared a schedule of British claims; whether this schedule has been presented to the Soviet Ambassador; and whether the schedule of British claims includes the bonds and other Russian securities held by British subjects?
    Mr. A. HENDERSON: No schedule of the counter-claims of the Soviet Government has been received during the current negotiations. In any statement of British claims those arising in respect of privately-held bonds and other securities will be classified separately from British Government claims, and an opportunity will be afforded for all interested parties to express thier views. All pecuniary claims of whatever nature against the Government of the Union of Soviet Socialist Republics that have been notified to His Majesty's Government by British subjects since 1918 have been registered at the Russian Claims Department of the Board of Trade. The negotiations with the Soviet Ambassador have not yet advanced sufficiently far for these claims to he presented to His Excellency.
    Sir B. PETO: Will the right hon. Gentleman take the opportunity of seeing that the register of the Board of Trade is up-to-date, and, in doing that, will he take into consultation the British Union of Russian Bondholders who are registering these claims from day to day?
    Mr. HENDERSON: I think we have been in consultation with this organisation, but I will keep in mind the suggestions made by the hon. Member.
    Mr. SMITHERS: In view of the statement of the right hon. Gentleman that there will be a differentiation between private and national claims, will he insist that the claims of the other side shall be put into two categories in the same way as our claims have been?
    Mr. HENDERSON: That is a matter which I shall have to look into.

    BRITISH RELATIONS.
    Sir ASSHETON POWNALLasked the Secretary of State for Foreign Affairs whether he intends to make from
    390
    time to time a statement as to the progress of the negotiations with the Soviet Ambassador?
    Mr. A. HENDERSON: I shall be prepared to consider this course if the circumstances call for it and provided any statement will not prejudice the course of the negotiations.

    PROPAGANDA.
    Commander BELLAIRSasked the Secretary of State for Foreign Affairs whether he will cause the intelligence branch of the Foreign Office to supply him with the references made in the official organs of the Russian Soviet Government to the training of natives of Eastern races, including Indians, in revolutionary propaganda; and whether he will direct the British Ambassador in Moscow to ascertain the facts in regard to the present position?
    Mr. A. HENDERSON: On two occasions I have asked the hon. and gallant Member to supply me with definite particulars. Unless I receive such particulars, I do not propose to take the action suggested.
    Commander BELLAIRS: Why does the right hon. Gentleman ask me to supply him with particulars, when, students who have been trained at these colleges have been convicted of conspiracy in India and the magistrates have made the strongest possible comments?
    Mr. HENDERSON: I asked the hon. and gallant Member on two occasions, because in his question he suggested the line upon which I had not information on which to act. It is quite a common thing in this House for Members when they put questions to be asked to supply particulars.
    Commander BELLAIRS: When Members are asked to supply information it it with regard to personal cases, but on a general question the Government collects it.
    Mr. KIRKWOOD: Is it not the case that the hon. and gallant Member is drawing attention to students in India, while we are dealing at the moment with Russia and not India at all?
    Captain CROOKSHANK: Am I to understand that the Foreign Secretary has no longer an Intelligence Branch at the Foreign Office?
    Mr. HENDERSON: I never said so.
    Colonel ASHLEY: Cannot the right hon. Gentleman easily inquire from the India Office, who will supply him with the facts?
    Mr. HENDERSON: I still feel I am entitled to ask the hon. and gallant Member to supply me with the particulars upon which he based his question.
    Colonel ASHLEY: The hon. and gallant Member has supplied particulars, when he states that the relevant facts are in the possession of the India Office?
    Mr. HENDERSON: No. He has not given me any particulars.
    Earl WINTERTONasked the Secretary of State for Foreign Affairs whether Mr. Roy, a British-Indian subject who is a fugitive from justice in India, is still in Soviet Russia; whether his attention has been called to this gentleman's revolutionary activities directed against the country of his origin for years past; and whether he will request the Union of Socialist Soviet Republics to restrain Mr. Roy and other British-Indian subjects from transmitting money and literature from Russia to British-India in order to spread sedition and disaffection?
    Mr. A. HENDERSON: According to information published in Communist organs in December, 1929, Mr. Roy has been expelled both from the Comintern and from the Communist party, and I understand that he has not been resident in the Soviet Union for some considerable time. The last parts of the question do not, therefore, arise.
    Earl WINTERTON: Will the right, hon. Gentleman be good enough to answer the middle part of the question, whether his attention has been called to this gentleman's revolutionary activities?
    Mr. MILLS: Is the right hon. Gentleman aware that this gentleman has been recently appointed the Riga Correspondent of the "Daily Mail"?
    Earl WINTERTON: Will the right hon. Gentleman answer the middle part of the question, and can he give a denial of the question asked by the hon. Member for Dartford (Mr. Mills)? Will he agree with me that this man is a most dangerous revolutionary?
    Mr. HENDERSON: I am afraid that I do not know anything about this man. [HON. MEMBERS: "Oh !," and "Why not"?] I hope hon. Members on the other side accept my statement. If the supplementary question asked by the hon. Member for Dartford (Mr. Mills) is accurate, that perhaps is the reason why my attention has not been called to his activities.
    Earl WINTERTON: Will the right hon. Gentleman be good enough to consult his colleague the Secretary of State for India, and will he be good enough in his rare leisure to read the report of the trial at Meerut, and the speech of the Public Prosecutor?

  FOREIGN COMMITMENTS.
  Rear-Admiral BEAMISHasked the Secretary of State for Foreign Affairs what commitments the Government has inherited and which it has to fulfil in relation to the present condition of the world?
  Mr. A. HENDERSON: A review of the foreign commitments, which His Majesty's Government have inherited, involves an examination of the treaties by which His Majesty's Government are bound in all quarters of the world, and I could not undertake to make a satisfactory statement within the compass of a Parliamentary answer.
  Rear-Admiral BEAMISH: Will the right hon. Gentleman say whether these commitments are acceptable, and whether the Government is proud to inherit them?

  ROYAL NAVY.

    BUILDING PROGRAMMES (REDUCTION).
    Mr. D. G. SOMERVILLEasked the First Lord of the Admiralty if he can give a complete list of the vessels which have been dropped, or are to be dropped, from our constructional programme as a result of the International Conference negotiations; and whether the list can be now regarded as complete from the point of view of our national safety?
    The FIRST LORD of the ADMIRALTY (Mr. A. V. Alexander): His Majesty's Government have already intimated what changes they have decided to make in the

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    programme of naval construction which they inherited from their predecessors. In the statement of the Prime Minister on the 24th July, 1929 (OFFICIAL REPORT, columns 1304–11), and my answers to the hon. Member for Devonport (Mr. Hore-Belisha) on the 29th January last (OFFICIAL REPORT, columns 975–6 and 1019–20) will be found the complete list of vessels with whose construction the Government are not proceeding, as well as their reasons for so doing.
    Mr. SOMERVILLE: Will the right hon. Gentleman answer the latter part of the question?
    Mr. ALEXANDER: I have already answered that in the reply to which I have referred.
    Mr. HORE-BELISHA: Has the right hon. Gentleman accurately described those reductions as a result of the Naval Conference? Are they not rather the preliminaries to the Naval Conference?
    Mr. ALEXANDER: That also was answered last week.
    Commander SOUTHBYasked the First Lord of the Admiralty whether it is proposed to scrap the four ships of the Hawkins class as part of the naval reductions?
    Mr. ALEXANDER: I cannot, at this stage of negotiations between the five Powers, make any forecast of possible reductions that may result from them.
    Captain EDENasked the First Lord of the Admiralty on how many warships of all classes work has been suspended since the present Government came into office; and how much money had been spent on these ships up to the time of the suspension of work?
    Mr. ALEXANDER: As regards the first part of the question, I would refer the hon. and gallant Member to the statement made by the Prime Minister on the 24th July last (OFFICIAL REPORT, columns 1304–1311), and to my reply of the 29th January (OFFICIAL REPORT, columns 975–976), to the hon. Member for Devon-port (Mr. Hore-Belisha). As regards the second part, I regret that I am not in a position to add to the reply given on the 6th November (OFFICIAL REPORT, column 1066) to the hon. and gallant Member for
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    Abingdon (Major Glyn), as the contractors' claims are still under investigation.
    Captain EDEN: Can the right hon. Gentleman give me a reply to the first part of the question? As the two questions are entirely different, and six months apart, would it not be useful to give the information asked for?
    Mr. ALEXANDER: As the information is already in the OFFICIAL REPORT, it is not too much to ask the hon. and gallant Member to look it up.
    Captain EDEN: As the right hon. Gentleman's reply six months ago referred to an entirely different matter, would it not be possible in ordinary courtesy for the right hon. Gentleman to give an answer?
    Mr. ALEXANDER: The answer is gathered together in the second answer to which I have referred.
    Captain CROOKSHANK: Is the right hon. Gentleman ashamed of giving the figures?
    Mr. ALEXANDER: No, Sir.

    CRUISERS.
    Commander SOUTH BYasked the First Lord of the Admiralty what are the names of the five cruisers now in special commission; upon what duties they are employed; and how many are employed outside home waters?
    Mr. ALEXANDER: As the answer is in tabular form I will, with the hon. and gallant Member's permission, circulate it in the OFFICIAL REPORT.
    Following is the answer:
    The required particulars are as follow:
    Ship, Function or Status and Present Position.
    "Concord": Signal School Cruiser, Portsmouth.
    "Champion": Gunnery and Torpedo School Cruiser, Portsmouth.
    "Cumberland": In commission with reduced crew while refitting, Chatham.
    "Dragon": In commission with reduced crew for trials, Chatham.
    "Dartmouth": In commission with navigating party for passage from Portsmouth to Devonport, where she will be placed in reserve, Devonport.
    His Majesty's Ships "Cumberland" and "Dragon" will shortly be completing to full complement for service on the China Station and America and West Indies Station respectively.
    Commander SOUTH BYasked the First Lord of the Admiralty the names of the seven cruisers now paid off for repairs, etc.; and whether any of these ships are now in the sale list?
    Mr. ALEXANDER: The seven cruisers referred to in my reply of the 5th February to the bon. and gallant Member [OFFICIAL REPORT, columns 1879–80] are His Majesty's Ships "Danae," "Colombo," "Cardiff," "Coventry," "Ceres," "Diomede" and "Dauntless." Since-then His Majesty's Ship "Dauntless" has been commissioned for trials. The remaining six ships are all paid off for large repairs and none are on the sale list.
    Colonel GRETTONasked the First Lord of the Admiralty upon what basis the reduced number of 50 cruisers as needful for the British Empire is calculated?
    Mr. ALEXANDER: The number 50 has been arrived at after full investigation and is that which will, it is considered, meet all requirements for the period of an agreement which it is hoped will be reached as a result of the London Naval Conference. The number is subject to the satisfactory outcome of that Conference.
    Colonel GRETTON: Cannot the right hon. Gentleman give the basis on which the calculation was made?
    Mr. ALEXANDER: That has already been stated. The Admiralty in the past advanced the view that a different number of cruisers was required, namely, 70. It has been quite plainly stated that, in view of the developments that have since taken place—the signing of the Pact of Paris and the holding of the Naval Conference—50 cruisers would be sufficient for the period covered by any agreement reached by the Conference.
    Mr. BOOTHBY: Is the signing of the Kellogg Pact the only new feature that has entered into the situation, or are there any other matters that have arisen since the minimum requirements were first stated as 70?
    Mr. ALEXANDER: The signing of the Pact of Paris was the act of one day, but the result of that act we hope will be a very different thing.
    Mr. BOOTHBY: Are these the only new factors that have entered into the situation?
    Major ROSS: Is it not the case that the right hon. Gentleman is banking on there being no war during that period, but, if war does break out, then our naval forces are insufficient?
    Mr. ALEXANDER: I have nothing to add to the answer that I have given.
    Mr. WISE: Is it not the case that a return to the previous figure would involve a substantial increase in cruiser tonnage at the present moment?
    Mr. ALEXANDER: If I understand the hon. Member to mean a return to the figure 70, most certainly it would.

    HOUSING, GOUROCK.
    Dr. FORGANasked the First Lord of the Admiralty if his attention has been drawn recently to the unhealthy condition, through dampness, of houses situated in Nelson Road, Gourock, which are the property of the Admiralty, and are inhabited by workers in the torpedo factory; if he is aware of the inadequate methods employed by his staff to remedy the evil; and what further action he contemplates in regard to this matter?
    The CIVIL LORD of the ADMIRALTY (Mr. George Hall): I am aware of the present unsatisfactory condition through dampness of the houses in question, and provision is made in the Navy Estimates Vote 10 for remedying the defects by re-roofing the houses. The work is proceeding as rapidly as funds and circumstances permit and every effort is being made to make the houses weatherproof.

    PROMOTIONS (LOWER DECK).
    Mr. THOMAS LEWISasked the First Lord of the Admiralty whether he is now in a position to report on the result of the consideration given by his Department to the subject of promotions from the lower deck?
    Mr. ALEXANDER: I would refer my hon. Friend to my reply of the 30th January (OFFICIAL REPORT, column 1193) to the hon. Member for Devonport (Mr. Hore-Belisha).
    Mr. LEWIS: Can the right hon. Gentleman say when he will be in a position to reply?
    Mr. ALEXANDER: I will read the reply to which I have referred:
    "The matter continues to engage the attention of the Admiralty, but it is obviously impossible to proceed actively with this and kindred questions until the result of the Naval Conference and its effect on personnel is known."
    Mr. HORE-BELISHAasked the First Lord of the Admiralty whether, see-that only five lower-deck ratings were promoted to the rank of mate in 1929 as against eight in 1928, seven in 1927, and nine in 1926, he can state any reasons for the falling off in the numbers qualifying for promotion to mate?
    Mr. ALEXANDER: I am not aware of any reason which can definitely be given for the falling off, but with the small number of candidates, the number promoted from year to year may be expected to fluctuate. The numbers in 1929 were about the average for the five years previous to 1926.

    FLAG OFFICERS.
    Mr. COCKSasked the First Lord of the Admiralty the number of admirals of the Fleet, admirals, vice-admirals, and rear-admirals on the active list of the Royal Navy; and whether he will give the number of these flag-officers, in each category, who are at present employed?

    —

    Rodney.

    Queen Elizabeth.

    Royal Sovereign.

    £

    £

    £

    Direct expenditure

    299,800

    251,700

    250,300

    Non-effective liability in respect of retired pay and pensions.

    49,900

    41,900

    41,600

    Total

    349,700

    293,600

    291,900

    Colonel HOWARD-BURYasked the First Lord of the Admiralty how many battleships it is proposed to scrap in 1930 and 1931?
    Mr. ALEXANDER: I would refer the hon. and gallant Member to paragraph 4 of Part II of Command Paper 3485.
    Colonel HOWARD-BURY: After that very elaborate answer can the right hon.
    Mr. ALEXANDER: As the reply is in tabular form I will, with my hon. Friend's permission, circulate it in the OFFICIAL REPORT.

    The numbers required are as follow:

    Rank.

    Number on Active List.

    Number employed.

    Admiral of the Fleet

    5

    1

    Admiral

    10

    5

    Vice-Admiral

    19

    15

    Rear-Admiral

    48

    25

    82

    46

    Of the 46 officers employed three are employed and paid by Dominion Governments.

    BATTLESHIPS.
    Mr. COCKSasked the First Lord of the Admiralty the annual cost of the upkeep of a first-class battleship, including the pay of the ship's complement, stores, firing practice, and everything necessary to maintain the vessel in a state of efficiency?
    Mr. ALEXANDER: As the reply is in tabular form I will, with my hon. Friend's permission, circulate it in the OFFICIAL REPORT.
    Following is the reply:
    The inclusive annual cost of maintenance in full commission as private ships is approximately as follows:
    Gentleman say whether there is any intention whatever of scrapping either of our latest battleships?
    Mr. ALEXANDER: Certainly not. If the hon. and gallant Gentleman will see the reference that I have given him, which is a paragraph taken out of the recent British memorandum on the conference, it will be quite plain.
    Mr. ANNESLEY SOMERVILLE: May we understand that the Government have not yet considered the latest American proposals for scrapping battleships, which would give the American Navy, not parity, but a large superiority in gun power and speed?
    Lord ERSKINEasked the Prime Minister whether proposals have been made at the Naval Conference by any foreign delegation that would entail the scrapping of battleships of the "Queen Elizabeth" or "Royal Sovereign" classes?
    The PRIME MINISTER: The answer to this question is decidedly in the negative.

    LIEUTENANT-COMMANDERS (RETIRED RANK).
    Captain W. G. HALLasked the First Lord of the Admiralty the number of lieutenant-commanders who have retired from the active list of the Navy since the War and have not received the customary advance in rank upon retirement; and the reasons for this differentiation?
    Mr. G. HALL: Particulars of the number required are not available and could only be obtained after undue expenditure of time and trouble. The reasons why a step in rank is not given in certain cases are:—(1) That the officer has not rendered before his retirement the qualifying service necessary; or (2) that his record has not been satisfactory; or (3) that he was below the age of 40 on retirement. In the last case, however, the step in rank may be given on reaching the age of 40, subject to the first two conditions being fulfilled.

    PORTSMOUTH DOCKYARD (HOLIDAYS).
    Captain W. G. HALLasked the First Lord of the Admiralty the estimated saving likely to accrue, as a result of the decision to close the Royal Dockyard, Portsmouth, for the week's holiday with pay recently granted, as compared with the cost of allowing the personnel to take the week as and when convenient to all concerned?
    Mr. G. HALL: It is not practicable to give a reliable estimate of the saving likely to accrue by adopting one scheme in preference to the other, but it is obvious that by closing for a week there
    400
    will be considerable savings due to the reduction of standing charges for power, lighting, transport, etc. The interference with work consequent on a considerable number of men being absent at varying times will also be avoided.
    Captain W. G. HALL: Surely the hon. Member can give us some figure? I understand that the dockyard is to be closed for a week because it is going to save money. Surely the Admiralty have some figures to go upon?
    Mr. G. HALL: This is a new concession. It is the first time for the dockyard to be closed for a week, and it is impossible to give any definite figure until the experiment has been tried.
    Mr. HORE-BELISHA: The hon. Gentleman is closing the dockyard for a week on the ground of economy. Surely he can tell as what that economy is going to be, because he will have to justify this treatment of the dockyard in a manner different from that of any other Civil Service Department?
    Mr. G. HALL: I think the statement that I have made is quite obvious.
    Mr. MOND: Will the hon. Member say why it is impossible for the Admiralty to make this calculation? Any business undertaking in taking this course would make the necessary calculations as a matter of course.
    Mr. G. HALL: I have nothing to add to the reply that I have given.

    DOCKYARDS (ALTERNATIVE WORK).
    Mr. HORE-BELISHAasked the First Lord of the Admiralty whether he has now considered the proposals made by the trades unions with regard to the provision of alternative work in the dockyards; if he will state the nature of these proposals; and what action he proposes to take?
    Sir K. WOODasked the First Lord of the Admiralty whether he has now given consideration to the proposals from the trade unions concerned with regard to the provision of alternative work in the dockyards; and what reply he has made to such proposals?
    Mr. G. HALL: The matter is still under consideration.
    Mr. HORE-BELISHA: Are we to understand that there has been a change in the policy of providing alternative work, and that it is not now the policy of the Admiralty to provide alternative work?
    Mr. HALL: I do not think the hon. Member has a right to make that suggestion.
    Mr. HORE-BELISHA: I am asking whether it is so.
    Sir ROBERT GOWERasked the First Lord of the Admiralty what work has been given to the Royal Naval Dockyard at Chatham in substitution for the proposed submarine depot ship which was cancelled; and how many additional men, if any, would have been provided with work there had the construction of such submarine depot ship been proceeded with?
    Mr. HALL: The principal items of work which have been given to Chatham in substitution for the proposed submarine depot ship are as follow:

    (1) The construction of a sloop.

    (2) The construction of a caisson.

    (3) Additional naval repair work.

    (4) The refits of certain oil carrying vessels.

    In addition the building of a second sloop is to be undertaken shortly at that yard.
    It was not the intention to enter additional men to progress the construction of the submarine depot ship.
    Sir R. GOWER: Will the hon. Gentleman say what is the difference between the cost of the work which he has just specified and the cost which would have been involved had the construction of the proposed submarine depot ship been proceeded with, particularly so far as labour is concerned.
    Mr. HALL: It is quite obvious that I must have notice of that question.

    TUGS (CARLEY FLOATS).
    Mr. HORE-BELISHAasked the First Lord of the Admiralty whether the Admiralty tug "St. Genny," which was lost in the recent gales, and the "St. Cyrus," which went to her assistance, were supplied with Carley floats; and, if not, whether he will see, in order to prevent further calamities, that this type of
    402
    craft is supplied with Carley floats in future?
    Mr. ALEXANDER: The reply to the first part of the question is in the negative. With regard to the second part these tugs had sufficient life belts on board for everyone. Although it is improbable that Carley floats would be of much help in conditions such as prevailed in the recent gales, arrangements have already been made for the provision of them to all such vessels.

    WASHINGTON STANDARD, TONNAGE.
    Lord ERSKINEasked the First Lord of the Admiralty what is the comparable Washington standard tonnage of the cruisers of the "Hawkins" class which appear in the Navy List as being of 9,750 tons displacement?
    Mr. ALEXANDER: The standard displacement corresponding to the Navy List displacement of 9,750 tons (which was the figure for these ships when designed in 1915) would be approximately 9,000 tons. Owing to modifications and additions during building and while on service, the standard displacements of the four vessels of the class are now:

    Tons.

    "Effingham"

    …

    …

    9,770

    "Frobisher"

    …

    …

    9,860

    "Hawkins"

    …

    …

    9,800

    "Vindictive"

    …

    …

    9,996

    Lord ERSKINEasked the First Lord of the Admiralty what is the comparable displacement tonnage, as calculated in the British Navy for ships built prior to the Washington Conference, of the 35,000-ton Washington standard battleship His Majesty's Ship "Nelson" and the 10,000-ton Washington standard cruiser His Majesty's Ship "Suffolk"?
    Mr. ALEXANDER: The actual tonnage of His Majesty's Ship "Nelson" under Washington standard is 33,500 tons. Her displacement tonnage as calculated in the British Navy prior to the Washington Conference is 34,600 tons. Corresponding figures for His Majesty's Ship "Suffolk" are 10,000 tons and 11,200 tons.

    TRAVELLING FACILITIES.
    Sir BERTRAM FALLEasked the First Lord of the Admiralty whether a reply has been received by the Admiralty from the railway companies to the in-

    403
    quiry whether an extension of the present travelling concession to a single fare for the double journey can be made to Naval ratings?
    Mr. G. HALL: The Railway Companies have replied that they regret they cannot see their way to accede to the Admiralty request.
    Sir B. FALLE: Will the Admiralty press the railway companies to re-consider this concession, which is already granted to the general public?
    Mr. HALL: The Admiralty quite recently wrote to the railway companies, and this is their reply to the letter.

    GENERAL MESSING (SULLAGE PROCEEDS).
    Sir B. FALLEasked the First Lord of the Admiralty whether, in view of the introduction of compulsory general messing for petty officers and men in shore establishments, the sullage which is the property of the men can be sold for their benefit and the sum realised credited proportionately to each mess fund for disposal as messes consider desirable instead of being spent as at present by the executive officer '?
    Mr. G. HALL: Under existing arrangements, the proceeds from the sale of sullage are expended generally for the recreation, amusement and well-being of the ratings as a whole, and it is not proposed to interfere with the local administration of these funds.

    INVALIDINGS.
    Sir B. FALLEasked the First Lord of the Admiralty the number of ratings invalided from the Royal Navy during the year let January to 31st December, 1929, and the number whose invaliding disability was considered to be attributable to service; the number of ratings invalided during the same period suffering from consumption; and the number of cases considered to be attributable to the Service?
    Mr. G. HALL: The particulars required are as follow:

    Number of ratings invalided during 1929

    1,328

    Number whose disability was accepted as attributable to the Service

    291

    AIRCRAFT CARRIERS (DEFINITION).
    Major ROSSasked the First Lord of the Admiralty whether there is any recognised definition of the term aircraft carrier; and whether a warship capable of flying off aircraft must always be so described?
    Mr. ALEXANDER: The tern "aircraft carrier" is defined in the Washington Treaty (Command 2036/1924) as follows:
    "An aircraft carrier is defined as a vessel of war with a displacement in excess of 10,000 tons (10,160 metric tons) standard displacement designed for the specific and exclusive purpose of carrying aircraft. It must be so constructed that aircraft can be launched therefrom and landed thereon, and not designed, and constructed for carrying a more powerful armament than that allowed to it under Article IX or Article X as the case maybe."
    Unless a warship is capable of flying on aircraft she does not come within this definition.

  UNITED STATES (NAVAL STRENGTH).
  Sir WILLIAM DAVISONasked the First Lord of the Admiralty whether, in estimating the naval strength of the United States, account is taken of the number of warships under the control of the American Treasury but not appearing on the strength of the American Navy?
  Mr. ALEXANDER: The answer is in the affirmative.

  EAST AFRICAN COLONIES (UNION).
  Sir H. YOUNGasked the Under-Secretary of State for the Colonies whether any representations have been received by the Secretary of State from representative bodies in Kenya, Tanganyika, or Uganda, either directly or indirectly through the governors, complaining of delay in dealing with the question of the closer union of those territories?
  The UNDER-SECRETARY of STATE for the COLONIES (Dr. Drummond Shiels): My Noble Friend has received, through the Governor of Kenya, representations

  405
  from the European Elected Members on the Legislative Council and from the Convention of Associations, to the effect that every endeavour should be made to expedite a final settlement in order that the economic progress of the Colony may no longer be hampered by continued doubt and uncertainty. No representations have been received from Tanganyika or Uganda.

  PALESTINE.

    PROSECUTIONS.
    Mr. FRANK SMITHasked the Under-Secretary of State for the Colonies whether he is aware that cases have occurred in which the Attorney-General of Palestine has instituted proceedings in cases previously dealt with and dismissed by the courts in Palestine; will he give a list of the cases in which this power has been exercised and with what result; under what ordinance such action has been taken; and if he will consider the desirability of discontinuing the practice?
    Dr. SHIELS: Under the Palestine Trial upon Information Ordinance, a person may be put upon his trial at the instance of the Attorney-General notwithstanding that a Magistrate has refused to commit him for trial. I am advised that the principle involved is not unknown to English law, and I see no reason to interfere with the administration of the law in Palestine. I am aware of one case of this nature that has occurred, but I am not in a position to furnish my hon. Friend with the list for which he asks.
    Mr. SMITH: I have not asked a question concerning cases that have been committed for trial, but as to cases which have been more than once dismissed and in one particular instance after a lapse of 12 months?
    Dr. SHIELS: Yes, I remember the case which the hon. Member has in mind, and we have gone fully into the matter, but, as I have said, we are not prepared to interfere at the present time.
    Mr. HOLFORD KNIGHT: Is the hon. Gentleman aware that weakened confidence in the administration of justice in Palestine is a contributory factor to the
    406
    unsettlement of that territory, and, if so, will he make inquiry in view of its importance?
    Dr. SHIELS: No, Sir, I am not prepared to accept the hon. Member's statement.
    Earl WINTERTONasked the Under-Secretary of State for the Colonies (1), whether the Prevention of Crimes Ordinance is still in force in Palestine; whether it is based upon special powers analogous to those which have been conferred upon the executive in British India from time to time; and if he will cause a copy of the ordinance to be placed in the Library;
    (2), what is the number of persons who have been tried for offences arising out of the disturbances in Palestine in August last; and how many of that number have been tried under the ordinary law of the land and how many under the Prevention of Crimes Ordinance, respectively?
    Dr. SHIELS: The number of persons tried, as reported up to date, is 1,094, of whom 40 were dealt with by the Court of Criminal Assize, 200 by the District Courts and the remainder by summary jurisdiction. I cannot say how many were dealt with under the Prevention of Crimes Ordinance, which is a part of the ordinary law of the land. The original ordinance was passed in 1920 prior to the assumption by the Secretary of State for the Colonies of responsibility for Palestine. It has been amended on various occasions, the last being December, 1929. I shall be happy to place a copy of this legislation in the Library of the House.
    Earl WINTERTON: Will the hon. Gentleman kindly answer the second part of question 53?
    Dr. SHIELS: As far as I know the real difference between similar ordinances in India and in Palestine is that in India they have a time limit and have to be renewed, whereas this ordinance is part of the permanent law of Palestine.
    Earl WINTERTON: Do I understand from the hon. Gentleman that the ordinance in all other respects is similar to the Bengal ordinance for which Members of the present Government, the hon.

    407
    Gentleman s own colleagues, so severely criticised the late Administration through me in the last Parliament?
    Dr. SHIELS: No, Sir; I do not think it is the same as the Bengal ordinance. It is part of the permanent law of Palestine which is used when certain conditions arise from time to time.
    Earl WINTERTON: I wish to give the hon. Gentleman notice that I shall put down another specific question on this point, so that we may know what is the real difference between these ordinances.
    Colonel HOWARD-BURY: Is the hon. Gentleman aware that the continuation of this ordinance leads to very much unrest, in view of the fact that people can be arrested and brought to trial without having a solicitor or anyone to defend them.
    Dr. SHIELS: I think I can get very good authority for the claim that the very opposite is the case.

    POLICE FORCE.
    Mr. MARCUSasked the Under-Secretary of State for the Colonies the number of officers, petty officers and men in the Palestine police force at the time of the outbreak in August, 1929, and the composition thereof, showing the respective numbers of Christians, Arabs and Jews?
    Dr. SHIELS: As the answer contains a number of figures I will, with my hon. Friend's permission, circulate it in the OFFICIAL REPORT.
    Following is the answer:
    I have not the actual figures in respect of August, 1929. They would be substantially the same as the figures at the end of 1928, which were as follow:
    Officers 119, non-commissioned officers and men 1,430, total 1,549. By religion: officers, Christians 62, Moslems 41, Jews 15, other religion 1; non-commissioned officers and men, Christians 389, Moslems 840, Jews 196, other religions 5.

    REVENUE AND EXPENDITURE.
    Mr. MARCUSasked the Under-Secretary of State for the Colonies the annual income and expenditure of the
    408
    Palestine Government from 20th July, 1920, until the last year for which figures are available?
    Dr. SHIELS: As the answer is in statistical form, with my hon. Friend's permission, I will circulate the figures in the OFFICIAL REPORT.
    Following is the answer:

    Period.

    Revenue.

    £E.

    £P.

    1st July, 1920 to 31st March, 1921.

    (1,108,528)

    1,136,951

    1921–22

    (2,312,243)

    2,371,531

    1922–23

    (1,764,585)

    1,809,831

    1923–24

    (1,633,893)

    1,675,788

    1924–25

    (2,101,072)

    2,154,946

    1925–26

    (2,739,091)

    2,809,324

    1926–27

    (2,390,081)

    2,451,365

    1st April to 31st December, 1927.

    —

    1,739,380

    1928

    —

    2,584,317

    1929*

    —

    2,299,792

    Period.

    Expenditure.

    £E.

    £P.

    1st July, 1920 to 31st March, 1921.

    (1,228,097)

    1,259,587

    1921–22

    (1,881,108)

    1,929,341

    1922–23

    (1,837,173)

    1,884,280

    1923–24

    (1,633,227)

    1,675,105

    1924–25

    (1,806,660)

    1,852,985

    1925–26

    (2,040,332)

    2,092,647

    1926–27

    (2,070,479)

    2,123,568

    1st April to 31st December, 1927.

    —

    1,944,397

    1928

    —

    3,381,993

    1929*

    —

    2,187,595

    * Subject to revision.

    DEAD SEA SALTS (CONCESSION).
    Colonel HOWARD-BURYasked the Under-Secretary of State for the Colonies whether, owing to objections raised by the French Government at the Dead Sea concessions being given to Mr. Moses Novomesky, the matter will now be brought before The Hague for their decision?
    Dr. SHIELS: I do not accept the first part of the question as an accurate description of what has taken place. The hon. and gallant Member was informed by my right hon. Friend the Secretary of State for Foreign Affairs on the 10th February that it had not been decided whether His Majesty's Government would agree to the suggestion that certain claims to a concession for the extraction of salts from the Dead Sea should be submitted to arbitration. I can add nothing to that statement at present.

    COMMISSION (REPORT).
    Colonel HOWARD-BURYasked the Under-Secretary of State for the Colonies if he will state when it is expected that the Palestine Commission will issue its Report; and whether he will publish at the same time the minutes of the evidence?
    Dr. SHIELS: At present I have nothing to add to previous replies on this subject.
    Colonel HOWARD-BURY: Has the hon. Gentleman any idea as to when this Report is likely to be ready?
    Dr. SHIELS: No, Sir. The Commission is working very hard on the Report, but I have made inquiries to-day, and I am informed that they are not yet in a position to state when the Report will be ready.
    Mr. BOOTHBY: Can the hon. Gentleman give any reply to the second part of the question, as to whether the minutes of evidence will be published or not?
    Dr. SHIELS: I have replied to that question, on another occasion, and I have said that that matter will be considered when the Report has been received.

  ECONOMIC ADVISORY COUNCIL.
  Major NATHANasked the Prime Minister whether he is able to state whether any persons have been chosen by him for membership of the Economic Advisory Council in virtue of their special knowledge and experience in industry and economics; and whether he is able to state the names of the secretary and assistant secretaries?
  The PRIME MINISTER: The following have consented to serve as members of the Economic Advisory Council:
  Sir Arthur Balfour.
  Mr. Ernest Bevin.
  Mr. W. R. Blair.
  Sir John Cadman.
  Mr. W. M. Citrine.
  Mr. G. D. H. Cole.
  Mr. Ernest Debenham.
  Sir Andrew Duncan.
  Sir Daniel Hall.
  Sir William Hardy.
  Mr. J. M. Keynes.
  Sir Alfred Lewis.
  Sir William McLintock.
  Sir Josiah Stamp.
  Mr. R. H. Tawney.
  As regards the staff, the following appointments have so far been made:
  Mr. Thomas Jones and Mr. A. F. Hemming (taken over from the already existing service).
  Mr. H. D. Henderson.
  Mr. H. V. Hodson.
  Mr. Colin Clark.
  I ought to add that in addition we have a list of distinguished industrialists and economists who have consented to assist on specific points.
  Mr. HORE-BELISHA: Is the Prime Minister satisfied that he has left out no one of note?
  The PRIME MINISTER: I am not sure whether the hon. Member has any specific person in mind, but I can assure him that there are a great many persons of note whose names have not been mentioned but who are willing to assist us when specific points requiring assistance arise.
  Mr. HORE-BELISHA: The only person I had in mind was Uncle Tom Cobley.
  Miss RATH BONE: In view of the rather special problems arising out of questions relating to the women's movement, will the Prime Minister consider the advisability of asking some woman acquainted with economic science to join the Council?
  The PRIME MINISTER: It would be very improper if I indicated people who have been approached, but I can assure the hon. Lady that that consideration has not been overlooked.

  SLAUGHTER OF ANIMALS BILL.
  Lieut.-Colonel MOOREasked the Prime Minister whether, in view of the extent of support shown in favour of the Slaughter of Animals Bill, he will consider giving facilities for a Second Reading discussion on the Measure and, if carried, for its further passage to the Statute Book?
  The PRIME MINISTER: I am afraid that in the present state of public business it is impossible for me to give such an undertaking as is asked for by the hon. and gallant Member.
  Lieut.-Colonel MOORE: With all deference to the right hon. Gentleman, is he

  411
  aware that there are 25,000,000 in this country, practically the whole of the electorate as represented by their Members of Parliament, who are in favour of this Bill?
  Mr. BLINDELL: Is the right hon. Gentleman aware that the Bill contains Clauses that will seriously interfere with the livelihood and liberty of certain workers in the industry?

  UNEMPLOYMENT (MEMORANDUM TO CABINET).
  Mr. BRACKENasked the Prime Minister if he will give the House of Commons an opportunity of considering the memorandum on unemployment submitted to him by the First Commissioner of Works, the Chancellor of the Duchy of Lancaster, and the Under-Secretary of State for Scotland?
  The PRIME MINISTER: No, Sir.
  Mr. BRACKEN: Will the Prime Minister give the House an assurance that he will protect the Lord Privy Seal against the intrigues of fashionable and futile Ministers nominally attached to him?
  Mr. BAILLIE-HAMILTON rose—
  Mr. SPEAKER: We cannot pursue the subject any further.

  HOUSE OF COMMONS (SITTINGS).
  Mr. WISEasked the Prime Minister whether, in view of the additional evidence this present Session of the increasing difficulty of dealing with a large number of questions requiring parliamentary attention on account of the congestion of business under the present Standing Orders, he will be prepared to extend the terms of reference of the committee to be set up on the hours of sitting so as to enable it to consider the whole question of a revision of the Standing Orders so as to expedite business and give Members a greater control over legislation and administration?
  The PRIME MINISTER: I am afraid that it is not possible to extend the terms of reference which were really fixed by the House itself.
  Mr. WISE: Is the Prime Minister not aware that many speakers in the discussion deplored the fact that the Motion was so drawn that it was impossible to debate the wider question and urge the necessity of considering the hours of sitting in relation to the general conduct of business here and upstairs?
  The PRIME MINISTER: That is so, but the Resolution passed by the House is being carried out.
  Mr. WISE: Is it not within the power of the Prime Minister to suggest to the House terms of reference which would meet the wider need and desire?
  Mr. HARDIE: In view of the congested state of business in this House at all times, and especially just now, is it not possible for the Prime Minister to get some working agreement whereby the business shall be spread so as to facilitate matters, so far as time is concerned?
  The PRIME MINISTER: I shall be pleased to co-operate with anyone to facilitate that end.

  AVIATION.

    MUNICIPAL AERODROMES.
    Mr. T. LEWISasked the Under-Secretary of State for Air the number of local authorities that have established municipal aerodromes giving the names of such authorities; and the number of authorities that are considering the subject, giving the names of such authorities?
    The UNDER-SECRETARY of STATE for AIR (Mr. Montague): The answer to the first part of the question is that five local authorities—Blackpool, Bristol, Hull, Manchester and Nottingham—have established municipal aerodromes. As regards the second part, six authorities—Carlisle, Ipswich, Liverpool, Plymouth, Sheffield and Stoke-on-Trent—have purchased land for aerodromes; 11 other authorities are negotiating for the purchase of suitable sites and five more have reserved sites in their town planning schemes. In addition, 76 authorities have shown that they are actively interested in the establishment of aerodromes, and of these, 38 authorities have had sites inspected.
    Mr. LEWIS: Is the hon. Gentleman aware if any authorities are experiencing difficulty in regard to the purchase of land owing to heavy costs; and, if so, will he take steps in the matter?
    Mr. MONTAGUE: That is a matter for the municipalities themselves, but I will take a note of the hon. Member's question.
    Mr. HARDIE: Is the hon. Gentleman aware that his Department is competing with municipalities who are trying to get land for housing schemes—in Glasgow, for instance, his Department is competing with the city for a piece of ground which his Department wants for an aerodrome —and what is he going to do about it?
    Mr. MONTAGUE: I am not sure that I am prepared to admit the entire accuracy of the suggestions in that supplementary question.
    Mr. HARDIE: There is no question about it. Is the hon. Gentleman not aware from the correspondence passing between his Department and the city of Glasgow, that they have been competing for this piece of ground which the city wants for other purposes; and, if he is not aware of that, what part of the business is he aware of?
    Mr. MONTAGUE: I am aware of the fact that in matters of this kind there are considerations of whether sites are suitable or not, but the general implication in the hon. Member's question I am not prepared to accept.
    Major Sir ARCHIBALD SINCLAIR: Does not that question show the importance of getting these aerodromes established before the ground is required for housing?
    Mr. PALMER: Is it the policy of the Ministry to assist municipalities in making these aerodromes?
    Mr. MONTAGUE: The policy of the Air Ministry is to assist the municipalities, and they are doing it as effectively as possible.

    CROSS-CHANNEL SERVICES (SAFETY REGULATIONS).
    Captain HAROLD BALFOURasked the Under-Secretary of State for Air if his attention has been drawn to complaints, by pilots of British civil aircraft crossing the Channel, of lack of
    414
    compliance, by the French aerodrome authorities at St. Inglebert aerodrome, with safety regulations for the immediate notification to Lympne aerodrome of the arrival and departure of such cross-Channel aircraft; and if he proposes to take any action to ensure that these regulations are complied with?
    Mr. MONTAGUE: Yes, Sir. Isolated complaints have occasionally been received from British pilots that on the French side the regulations with regard to the reporting of aircraft not equipped with wireless have not been fully carried out. The attention of the French air authorities is always called to complaints of this nature when they are brought to the notice of the Air Ministry.
    Captain BALFOUR: Has the hon. Gentleman had any satisfactory replies from the French authorities on this question?
    Mr. MONTAGUE: I must have notice of that question.

  ROYAL AIR FORCE.

    PLAIN CLOTHES (RULES).
    Captain HALLasked the Under-Secretary of State for Air if he is aware that considerable dissatisfaction exists among men in the Air Force because they are not allowed to walk out in civilian clothes when off duty; and whether, seeing that this privilege is granted to men serving in the. Navy and Army, it is proposed to extend the same privilege to men serving in the Air Force?
    Mr. MONTAGUE: No, Sir. As I stated in my reply to the hon. Member for Gillingham (Sir R. Gower) on 6th November last, I have no reason to suppose that the present rules with regard to the wearing of plain clothes by airmen are contrary to the general feeling in the Royal Air Force. My hon. and gallant Friend is under a misapprehension, I think, in regard to naval practice; I understand that naval ratings are not allowed to enter or leave their ships or establishments except in uniform.
    Captain HALL: Can the hon. Gentleman say why men of the Air Force should be treated differently from the men of the other two branches of the Fighting Services?

    OFFICERS' SUBSISTENCE ALLOWANCES.
    Captain BALFOURasked the Under-Secretary of State for Air whether any reductions have recently been made in the scale of subsistence allowances payable to Royal Air Force officers while temporarily away on duty from their stations; and, if so, the amount of such reductions and the reasons which have caused this alteration in the scale of payments?

    Existing Scales.

    —

    Nightly rate.

    Daily rate.

    First 8 Nights.

    After 8 Nights.

    When rationed and accommodated.

    5–9 hours.

    Over 9 hours.

    Rate 1.

    Rate 2.

    Rate 3.

    Rate 4.

    Rate 5.

    s.

    d.

    s.

    d.

    s.

    d.

    s.

    d.

    s.

    d.

    Officers of rank of Group Captain and upwards.

    30

    0

    15

    0

    7

    0

    6

    0

    15

    0

    Other officers

    22

    6

    12

    6

    5

    0

    4

    0

    11

    6

    The revised rates will not be subject to deduction of ration allowance, at present 1s. 7d. a day, as are certain of the present rates. It may be added that the revision of subsistence allowances forms part of a wider revision of allowances as a whole and of travelling concessions, the effect of which is, in general, favourable to the officers concerned.

  TRANSPORT.

    ROAD WORK (BRITISH MATERIAL).
    Major GEORGE DAVIESasked the Minister of Transport whether, seeing
    Mr. MONTAGUE: The answer contains a statement in tabular form, and with the hon. and gallant Members permission I will circulate it, therefore, in the OFFICIAL REPORT.
    Following is the answer:
    The answer to the first part of the question is that as from 1st April next the rates of subsistence allowance are being revised and in general reduced. As regards the second part, the following are the existing and proposed scales:
    that in response to a pressing appeal, dated 9th July, 1929, from his Ministry to submit a programme of road construction and improvement in order to alleviate unemployment, the Somerset County Council submitted, among others, a scheme for a new road from Holbrook House to Lattiford, in the rural district of Wincanton, which has been under consideration for five years, and that this scheme has been before the Ministry since last July, he can give an early decision as to the grant, without which the scheme cannot go forward?
    The MINISTER of TRANSPORT (Mr. Herbert Morrison): A scheme for the construction of a new road from Holbrook House to Lattiford has been approved in principle for a grant from the Road Fund, and a revised estimate of the cost was received in my Department on the 6th February. The engineering details are now being examined and I hope shortly to be in a position formally to make a grant.
    Major DAVIES: Is the hon. Gentleman aware that these delays, in this case as much as seven months, not only discourage local authorities in their efforts to meet his views, but also discourage them in their efforts to help the Lord Privy Seal in the task which he has before him?
    Mr. MORRISON: In view of the assumption in the hon. and gallant Member's question, the House had better have the facts. The scheme is an old one. It was revived by a formal application made to the Ministry in October last and transmitted to the divisional road engineer, who reported in January. It was then observed that the scheme had been submitted on the basis of an old estimate, and the divisional road engineer was asked for a report giving revised costs. These have now been obtained, and the scheme has been amended since it was first submitted. In the past, the scheme has not been regarded as sufficiently urgent to warrant priority being given for the purpose of assistance from the limited funds made available in past years for work of this character.
    Mr. LOUIS SMITHasked the Minister of Transport what steps are being taken by his Department, in view of the approach of the road repairing season, to influence local authorities to place their requirements for road material so that the recommendations to use entirely British plant and material, contained in the circular letter 1,060 of the Ministry of Health, will be adopted in practice?
    Mr. MORRISON: It is now a condition of all grants from the Road Fund towards the cost of works expedited for the relief of unemployment that all materials shall so far as practicable, have their origin in the United Kingdom and all manu-
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    factured articles shall have been manufactured in the United Kingdom subject, however, to such exceptions as I may find to be necessary or desirable in any particular case having regard to all the circumstances, including the comparative prices of home and foreign articles. Failing the purchase of the necessary supplies from sources within the United Kingdom, products of the overseas Empire should be used wherever possible. I am about to issue a circular letter on the subject to highway authorities.
    Colonel ASHLEY: Has it not always been the practice in the case of works expedited for the relief of unemployment that British materials should be used as far as possible?
    Mr. MORRISON: I believe that is so.
    Mr. SMITH: Can the hon. Gentleman say whether the exception to which he has referred will be brought to his notice?
    Mr. MORRISON: Special notice is taken of any cases of exception.

    CROSS-ROAD TRAFFIC.
    Mr. BOWENasked the Minister of Transport whether the representations of the Pedestrians' Association, suggesting that where two important roads cross each other two half-circle islands be constructed to slow down traffic on the road of lesser importance and to deflect it into the more important road in the direction in which its traffic is moving, has been brought to the notice of the Traffic Advisory Committee; and, if so, the result of their consideration of such proposal?
    Mr. HERBERT MORRISON: In September last a report on the lay-out of cross-roads, which covered the suggestion recently made by the Pedestrians' Association, and which had been drawn up by the Town Planning Institute in collaboration with my Department, was circulated to all highway authorities, and was also brought to the notice of the London Traffic Advisory Committee.

    SEVERN BARRAGE SCHEME.
    Mr. HOFFMANasked the Minister of Transport if the Report with reference to the Severn barrage scheme for electrical development is yet ready; and, if so, when it will be available to Members?
    Mr. HERBERT MORRISON: I would refer my hon. Friend to the reply which I gave on the 21st January to a similar question by the hon. and gallant Member for Maidstone (Commander Bellairs), of which I am sending him a copy.
    Colonel ASHLEY: Can we have some additional information, in view of the Supplementary Estimate which deals with the subject, and which the House, I under stand, will discuss next week?
    Mr. MORRISON: If the House discusses the Supplementary Estimate next week, the House will then have additional information.
    Colonel ASHLEY: But does it always follow that Ministers do give information?
    Mr. MORRISON: My experience is that the present Ministers give the maximum of information.

ACCESS TO MOUNTAINS.
Mr. GRAHAM WHITE: I beg to move,
"That leave be given to bring in a Bill to secure to the public the right of access to mountains and moorlands."
This Bill has already had a long Parliamentary experience. A similar Bill, but referring to Scotland only, was introduced in the last century by Lord Bryce, and it obtained a Second Reading as long ago as 1888. A like Bill, but referring to England and Wales as well, was introduced in this House by my right hon. Friend the President of the Board of Education in 1908, and on that occasion it obtained a Second Reading by a majority of 112. The Bill has been reintroduced on several occasions since then, and it obtained a Second Reading in 1924. If the Bill was urgent 30 or 40 years ago, the necessity for it is still more obvious to-day, for the movement of the population from the country to the towns which was in progress then has continued down to the present time; and it is indeed more necessary than ever that the great open spaces in close proximity to great centres of population should be free and open to the public. The case for the Bill rests upon the need of securing the greatest amount of health and happiness for the community as a whole. I think it is recognised by everybody that if our town populations are to have healthy
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lives in towns, they must have the freest possible access to country air and country exercise, at least on those occasions when they have the opportunity of taking holidays.
The Bill is a simple Bill. It is not an attack upon the rights of landowners or upon the owners of sporting rights. The main Clause lays it down that no owner or occupier of uncultivated land shall have the right to exclude from such land persons who shall be walking upon it or who shall be upon it for the purpose of recreation or for the purpose of artistic or scientific study. The second Clause suggests that it should be a sufficient defence against an action for alleged trespass that the person so proceeded against should be able to prove that he was not upon that land for an illegitimate purpose or that he had not caused any damage to such land.
It is not necessary to dwell at any length upon the remaining Clause of the Bill, which suggests adequate safeguards against possible abuse. For the great multitude of the people behind the Bill, and who wish to see it on the Statute Book, are the very people who would deprecate any trespassing or willful damage to vegetation or animal life, and who are already in arms against that trespass against the senses which is perpetrated on a large scale by the defilement of the countryside by commercial advertisements and the distribution of bottles and other debris by careless motorists.
This great body of people, who are looking to the House of Commons in this matter, are a very important element in the campaign for the preservation of rural England. There have been few movements in recent years more remarkable than the increase in the number of societies for climbing, rambling, and camping, and that growth is shown not only in the increase of the societies, but in the increase of their membership. There are six societies in the North of England which have it in mind to amalgamate, and it is estimated that their membership will total something like a million. Many hon. Members have had the opportunity of addressing meetings convened in support of this Bill, which have been called far from the towns in the heart of the country, and they cannot fail to have Been impressed by the enthusiasm and earnestness of this move-

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ment. I would like to call in aid a speech of the right hon. Gentleman the Prime Minister which he made on the Second Heading of this Bill in 1908, when he put the question to the House:
"Was Parliament to recognise the national right to enjoy national scenery? Was the House in favour of declaring that the mass of the people of this country, whether they live in the towns or in the country, had a right to enjoy wild, uncultivated and unspoiled nature? "
The people who are behind this Bill do not think that they are asking for any great concession. They are simply unable to understand why they should not have the same right of access to mountains and moorlands in this country that the people have in Switzerland, Italy, Austria, and, as far as I know, other countries outside the range of my experience, have to the national beauties of their countries.
Question put, and agreed to.
Bill ordered to be brought in by Mr. Graham White, Sir Martin Conway, Mr. Noel Baker, Mr. Philip Oliver, Mr. Scott, Miss Wilkinson, Mr. Cecil Wilson, Mr. Frank Owen, Mr. Benson, and Mr. Ede.

ACCESS TO MOUNTAINS.
  ACCESS TO MOUNTAINS BILL,
  "to secure to the public the right of access to mountains and moorlands," presented accordingly, and read the First time; to be read a Second time upon Wednesday, 5th March, and to be printed. [Bill 124.]

AGRICULTURAL WAGES (REGULATION) ACT (1924) AMENDMENT.
Colonel CLIFTON BROWN: I beg to move,
"That leave he given to bring in a Bill to amend the law as concerning agricultural workers engaged on long-term hirings."
This Bill affects those in the agricultural industry, particularly in the north of England, who engage themselves for long-term hirings. It is true that in Scotland farm workers are engaged in the same way, but in that country the National Wages Board does not act, and therefore this Bill does not apply there. The custom in the north of England is that a man hires himself for a period of months for, not a weekly wage, but for a lump sum at the end of the period, and he
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receives board and lodging. So far, that system has worked admirably, but a case which came to the courts the other day gives a loophole for possible abuse, and might do harm to these farm workers. A man engaged himself for 11 months two years ago, and then he had a row with his employer and left his employment without notice. His employer had paid him for seven months' work a total of £9 10s. That represented petty cash payments, and it left £20 8s. 3d. due to him. One would naturally think that this man, having worked for that period, had earned the money. The case was taken to court, and the justices turned it down. The Ministry took it up last July, and it was turned down by the Court of Appeal.
The ground on which the appeal was made by the officers of the Ministry of Agriculture was that, under Section 7 (1) of the Agricultural Wages (Regulation) Act, the man was entitled to a weekly rate of wages for each week in which he had worked, and that the effect of this judgment was that if a man, instead of leaving his employers, had died, his legal representatives would have no legal claim whatever, even though the man had worked for It months out of the 12 months contract, and had died at the end of the 11 months. That was a very poor position in which to put a workman. I have the particulars here as reported in the "Central Landowners' Journal." The Appeal Court found that the Wages Act only lays down that the rate of wages per week shall be a certain amount, and not less than that, but that it does not lay down that the wages are to be paid weekly; secondly, that the Common Law lays down that an agreement between a man and his employer to work for a period of months was a contract, and the contract was only completed at the end of that period of months; therefore, that nothing was due by the employer until the six months or 12 months was completed.
This leaves a very big gap, which should be closed at the first possible opportunity. I feel that we cannot, in the interests of agricultural workers in the north of England, leave their widows to be exposed to this risk. I daresay that no decent farmer would do it, but suppose that a farmer went bankrupt, he might not be allowed to pay the money to the widow in those circumstances. I put a

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question to the Minister of Agriculture the other day, and I understand from the written reply that the Minister hopes that this will not prove injurious to agricultural labourers, but that, if it does, he is prepared to introduce legislation. We who are backing this Bill think that action should be taken now. There is a loophole, and we want it closed at once. For that reason, those of my hon. Friends and myself who are backing this Bill ask the House for leave to bring in this Measure.
Question put, and agreed to.
Bill ordered to he brought in by Colonel Clifton Brown, Captain Todd, Captain Dugdale, Major Carver, Sir Douglas Newton, and Brigadier-General Clifton Brown.

AGRICULTURAL WAGES (PECULATION) ACT (1924) AMENDMENT BILL,
"to amend the law as concerning agricultural workers engaged on long-term hirings," presented accordingly, and read the First time; to be read a Second time upon Wednesday, 12th March, and to be printed. [Bill 125.]
NATIONALITY OF MARRIED WOMEN BILL.
Order for Second Reading upon Tuesday next read, and discharged; Bill withdrawn.

HOUSING DEVELOPMENT.
Mr. PHILIP OLIVER: I beg to move,
"That this House views with regret the excessive burdens placed upon the occupiers of new houses by the incidence of the present rating "system and by street-paving charges, and the detrimental effect of such burdens upon future housing development, and urges the Government to consider proposals for the reduction of such burdens in connection with any future legislation dealing with the question of housing."
4.0 p.m.
We have been promised in the King's Speech at the opening of this Parliament, legislation to promote an extensive programme of slum clearance and to make further provision for housing in urban and rural areas. The Government have done well to link together the two problems of slum clearance and the provision of new houses, for there can be no really effective slum clearance without the provision of alternative accommodation. But the problem is fraught with the greatest difficulty, because in all our efforts up to the present, the rents of all new houses have been greatly in excess of what any slum-dweller has been able to pay, and that applies not only to the slum-dweller. It applies to all tenants of small new houses. It applies also to the small owner-occupiers. In all these cases the cost of their home swallows up a disproportionate amount of their income, and has made them poor. In this matter I am as much concerned with the owner-occupier as I am with the tenant, and I hope that in any administrative action or legislation which the Government may adopt, they will make no distinction between the two. The owner-occupier is often a man of very moderate means. He is sometimes an owner-occupier simply because he cannot be a tenant. Such is the case of the artisan who is transferred in the course of his work from one town to another. He becomes a stranger in a strange land, and, not being a citizen, he cannot obtain a house on a municipal estate. In cases of this kind, at any rate, there is no distinction in fact between the owner-occupier and the tenant. The small tenant and the small owner-occupier are each equally harassed by the cost of their home.
What are the elements in the cost? It seems to me that they are, broadly speak-
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ing, four. There is the cost of building, the cost of land, interest charges, and what I may term external burdens, the chief of which are rates and road charges. If we are to solve this problem effectively, it is necessary, of course, to deal with each one of these four elements, but today I propose to call the attention of the House only to the fourth element, the external burdens, the chief of which are rates and road charges. First of all, with regard to rates. Rates, as we know, were originally assessed on annual value, because that was regarded as a rough estimate of the occupier's capacity to pay. That was never even approximately true of industrial premises, as was, of course, so rightly noticed by the late Government in their De-rating Act. It was never approximately true of industrial premises, and I do not think it was ever really true of houses. Rent may, at some time or other, have had some proportion to the occupier's income. That theory now has completely broken down, owing to the immense change in costs since the War, and the great disproportion which to-day exists between an old house and a new house occupied by a family whose means are absolutely similar. As we know, the close-drawn curtain of many a municipal house on a new estate hides behind it just as much deep poverty as you will find in any slum.
My hon. Friend the Member for Withington (Mr. Simon), who, I hope, will be seconding this Motion, in a recent book of his, has published results of an inquiry into the ratio of rate; to family income in a given congested area. As a result of this inquiry, it was found that in this congested area the proportion of income which went in rates varied from 4 per cent. to 9 per cent. with an average of 5 per cent. It may he that one-twentieth of the family income is not an unreasonable charge to levy upon these poor people to meet the communal needs of the locality; personally, I am not sure that that charge is not too heavy. There are many homes in prosperous suburbs in which the ratio of family income which goes to rates is under one-half per cent.—one-half per cent. in marry of the wealthier suburbs, and 5 per cent. in the slums. Great contrasts of that kind can, of course, only in the end be done away with by a complete change in the system of rating, which, perhaps, ought to take the line of a local income tax. But

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things being as they are, what is going to happen when you transfer these people, as you intend to do, from the congested slums into the new municipal estates? Their rents, of course, will be higher. That is only right, because they are living in better houses. But simply because their rents are going to be higher, their rates are going to be higher, too.
The inquiry to which I have already referred, proceeded to make a calculation as to what would be the ratio of the rates to each of the families living in this congested area when taken out of it and placed in the smallest possible houses that will accommodate them in a new municipal estate. It was found that the ratio of rates to family income which, when they were living in the slum, averaged 5 per cent., would in that municipal estate be increased from amounts varying from 7 to 17 per cent., with an average of 10.8 per cent. One-tenth of the income of these people, the poorest in our midst, going in rates—a burden which it is, quite obviously, wrong to impose upon them. For what have you done? You have taken them—and rightly taken them—from the slum to the new estate. You have doubled—and rightly doubled—their rent. There has been no increase in their income. They have been transferred, probably a considerable distance, from the place at which they work. They have to incur every week a considerable burden in the form of added tram fares. In addition to this, while there is no increase of income, you will have doubled the rates they have to pay. Yet, of course, there has been no increase in the cost to the community; indeed, it may very well be hoped that, having transferred them to healthier surroundings, they may, at any rate, as far as the health services are concerned, cost the community less than they did when living in the slums. Although there is no added burden to the community, the burden on these, the poorest in our midst, is actually doubled.
Quite obviously, there is need for some reform, and we have to ask ourselves what that reform is going to be. There may be, of course, a diminution in the general burden of the rates, either by economy or by transferring to the National Exchequer burdens which ought to be national in their incidence. Those reforms will, of course, affect the general burdens on all ratepayers, and will not
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remedy this particular injustice, which is the difference in rates levied on the same people according as they live in an old house in a congested area, or in a new house in a newly-developed estate. I myself think that the rating of land values will bring very considerable relief. Land value in new estates is comparatively low, and no one would benefit more from the rating of land values than the occupiers of newly-developed estates. I think, therefore, the time for the introduction of such a Measure is singularly opportune, but I do hope, if it is introduced, it will be in substitution for, and not in addition to, the burdens that we have to bear already. But, in addition to the rating of land values, I think that to meet this particular case, which, after all, is restricting the further development of housing, we shall need to have some system of differential rating. Suppose, for instance, in a town the net rent of the smallest house in a congested area is 4s., the assessment of that house would be approximately £8. You might say the rates are 2s. a week. The proposal is that all new houses built and rented up to 8s. net, should also be assessed only at £8, and therefore pay the same amount in rates, namely, 2s. This would enable people to be transferred from congested areas to new estates without placing upon them an added burden. I do not desire to elaborate that interesting suggestion, which, I hope, will be dealt with by the right hon. Gentleman in his reply.
Let me turn to the kindred subject of road charges. As the House will be aware, the streets at present are constructed according to specifications which are laid down by the local authority and are paid for by the frontagers. The procedure is carried out either under the Public Health Act, 1875, the Street Works Act, 1892, or innumerable local Acts, some of which date back as far as 1850. The law varies from place to place, and is the cause of great confusion. I think that here some uniformity is certainly desired. The cost of the street is obviously added to the cost of the house and has to be borne by the occupier. If the occupier is a tenant, it is borne in the rent, whether it be a house on a municipal estate or an estate which has been privately developed; and if the occupier is the owner, it is borne by a direct charge levied upon him. The

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owner-occupier purchases his house in complete ignorance of the amount of the charge for road making which is going to be levied upon him. The builder is frequently an optimist and underestimates the charge which the local authority will levy; and when that charge falls it is often the last straw which breaks the owner's back. There is not much romance in paving stones, and every chairman of a paving committee will tell you that sometimes there is a great deal of tragedy.
Let me give one or two instances of these high charges. I will take, first, an instance from a public utility society which is building in the area of a local authority whose charges are not unduly high. Last year the society developed an estate, and the street charges on that estate swallowed up 143 weeks' rent. Nearly three years' rent taken away for the making of the street, the small street necessary to go with small houses! I have an instance from a city in the North where a subsidy house was erected at a cost of £490. Perhaps there were special circumstances here, but that house had to bear a burden of £200 towards the cost of making the street. I have an instance from the South where a corner house, a subsidy house, erected for £450, had to bear an added burden of £170 for the making of the street. These are excessive burdens which are crushing further development.
Not only are the burdens heavy, but there is an amazing variation in the requirements of different local authorities. For similar roads in different parts of the country the charge varies from 15s. to 50s. a foot, and in two cities—I should not say cities, or perhaps hon. Members will guess which they are—in two towns which I know, side by side, so that it is almost impossible to know sometimes whether you are in the one or in the other, one charges 24s. a foot and the other, only a stone's throw away, 40s. a foot, for streets which are exactly similar. Not only is there variation between one district and another, but, unfortunately, variations are to be found in the same municipal area. Where there is a municipal housing estate there will be one standard for its roads and another standard, and a higher standard, for the roads on an estate developed either pri-
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vately or by a public utility society. In one case of which I am thinking there is a municipal estate with 16-foot roads, and immediately adjoining it an estate, developed by a public utility society, and inhabited, as a matter of fact, by poorer people than live on the municipal estate, where a demand has been made for the making of 24-foot roads, and that has meant an added burden of £15 10s. on each house. These are houses built for the poorest of the poor. The poorer you are the greater the burden yon have to bear. All this is wrong—the great burden to begin with, the variation between one district and another, and then this insane variation within the same municipal area.
What are the suggestions for reform which we make? In the first place, I suggest that road making might very properly become a communal charge. We provide our gas and water mains at the public expense, and why not our streets? It is necessary that gas and water should get into our houses, but it is still more necessary that the inhabitants of the houses should get into them. If the community bring gas and water to your house, why should they not bring you to your house? The cost would be paid out of revenue; or, in rapidly extending towns, it might be more expedient to borrow over a loan period of, say, 20 years. In making this proposal I am thinking principally of the development of these new estates. I do not want to relieve anyone of burdens which he might legitimately be called upon to bear, and in the wealthier suburbs, where there are houses of high rateable value, with a long frontage, owing to the magnificence of the premises and the extent of the garden, such houses might quite properly be separately dealt with. If people want a large plot of land around their houses, quite rightly they ought to pay for the road bordering their large gardens, and not place that burden upon the community.
There is another consideration, and nowadays a stronger consideration, I think, which I would urge in favour of making road charges a public charge. The Ministry of Health and the Ministry of Transport and, I think, all concerned with the amenities of our countryside, are deploring what is known at present as "ribbon development." Why is there ribbon development? One of the reasons

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is that there are no road charges for houses along an adopted street or a classified highway or an arterial road. Every decent person wants development to be in the form of what is called "block development," and not ribbon development. Then why overburden with road charges everyone who develops housing on the lines you desire, while making things easier for the person who develops along the lines you do not desire. For that further reason I think it is desirable, especially at the present time, that road charges should be regarded as a communal burden. I daresay this proposal is too Socialistic for the present Government to adopt.
Sir KINGSLEY WOOD: Is it too Socialistic for the Liberal party? Is the hon. Member making this proposal on his own account?
Mr. OLIVER: I am proposing it on my own account. This is a Private Member's day, when, without our leaders, we are able to say just what we think. At any rate I can say that both Liberal and Conservative parties have in the dim and distant past made the provision of tennis courts and bowling greens, of museums—to which nobody ever goes—and of art galleries a public duty; but people do go to their own houses, and therefore I think we are entitled to make the streets for them. If that be too Socialistic a proposal, at any rate I hope that some part of the road charge should be regarded as a public charge, as I know it can be already under certain legislation. It seems to me that so much of the cost of a street as is not due to the requirements of the residents in that street might very well be regarded as a public change; so much of the cost as is due to through traffic ought quite obviously to be a public charge. What the proportions ought to be I do not say, but there is a proportion. By far the greater part of the cost of every road which is constructed is not due to the requirements of the frontagers at all, but to the requirements of the public passing from one part of the town to another, and therefore, quite obviously, that part of the cost ought to be placed upon the community and not upon the frontagers.
Take the case of a great palace like Chatsworth or Blenheim. You have in one of those ancestral homes a far bigger
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population than you have in any residential home in a small suburb. For the access of that great population, living in one of those big palaces, we know that all that is required is a modest carriage drive, decently and moderately constructed, and 13 to 20 feet wide; but as soon as we begin to build cottages where not dukes, but poor people, are to live, we have to have a street which is 40 to 50 feet wide, made of asphalt, granite, concrete and such other absurdities, which crush out the life of the houses and often ruin the homes and the happiness of the residents. Why? The whole thing seems to be absurd.
Mr. HOLFORD KNIGHT: Because it is a public highway.
Mr. OLIVER: I know what the hon. Member is thinking about. He is thinking that we must have this concrete and asphalt and tar macadam because when the public have taken over the street the public will have to repair it; but what earthly sense is there in putting all this solid material, feet deep almost, into a street that is, never, perhaps, going to be used by heavy traffic, and certainly never will be used by heavy traffic for the people who live in the street? In so far as heavy traffic does pass along the street, it is the heavy traffic of the public generally, traffic for the convenience of the public, and therefore quite obviously the requirements of the traffic ought to be paid for by the public. That seems to be a good Liberal doctrine, and I should think it would be a good Socialist doctrine; but if the Socialists are going still further to harden their hearts and say no part of this burden is to be a public charge, at any rate the Government ought to lighten the burden on the private individual.
In many places it is becoming a case of
"My father hath chastised you with whips, but I will chastise you with scorpions."
As far back as 1919 the Local Government Board issued a manual of town planning. That manual lays down special requirements for all manner of streets. Almost every local authority is exceeding the requirements officially laid down by the Local Government Board and later adopted by the Ministry of Health. If the cost of these streets is to be borne by private individuals the requirements

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which the Local Government Board, and now the Ministry of Health, regard as sufficient should be made compulsory upon the local authorities. We do not want these great wide streets. Once they were necessary, because there was nothing between house and house. Now we limit the number of houses to the acre, and wide streets have become unnecessary, but wide streets still persist, the dead hand of the past again crushing the present.
When the Hampstead Garden Suburb was laid out a special Act of Parliament was required. In that Act the promoters agreed—and I think it is the first time this appears on our Statute Book—to limit the number of houses to eight to the acre; and in return Parliament exempted the promoters from all bylaws which were then in existence with regard to the width of streets. The limitation of houses to the acre has now become general. Why not abolish the limit of width of streets? By so doing you would relieve the houses of a crushing burden and aid the beauty of your development. No one who has gone to a place like Earswick, in Yorkshire, developed when there were no by-laws, will ever doubt that here beauty and economy have walked hand in hand. I hope I have shown how, in certain practical ways, the justice and reasonableness of which I think no one will deny, we can reduce one of the elements in the cost of housing, and thus bring to our people decent homes without placing on them a burden which they cannot bear.
Mr. E. D. SIMON: I beg to second the Motion.
The hon. Member for Blackley (Mr. P. Oliver) has dealt with two separate burdens which make new houses more expensive, rating and paving charges. Over 10,000 houses have been built in my constituency since the War, and I must have had hundreds of cases brought to my notice where the paving charges have been something like £30, £50 or even £100, and, in the case of larger houses, sometimes the charge has actually been over £200. The hon. Member for Blackley has dealt fully with this point and I hope the Government will do all that they can to deal with this very serious state of affairs.
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I wish to draw attention to the other aspect of this question which is even more important in the national interest. I think it has been universally recognised that in spite of the immense efforts which have been made in house building since the War, we have failed to do anything substantial to meet the requirements of the people who live in the slums. Prom almost every district you hear the same story of overcrowding in the slums, and to-day things are just as bad in this respect as they were at the time of the Armistice; as a matter of fact, the condition of the slums at the present time is actually worse than it was at the time of the Armistice. It was estimated at the time of the Armistice that there were 2,000,000 children living in the slums and 2,000,000 children are still living there and the conditions in the slum areas are actually worse. During that period I believe we have spent £1,000,000,000 of capital in building houses.
The average cost of the houses which have been built during the period I have mentioned is about £600 and that means an actual expenditure of £1,000,000,000 on building new houses since the War. That is a gigantic sum. Our total national wealth is estimated at £20,000,000,000; in 10 years we have spent 5 per cent. of our national wealth in building houses. In spite of that huge expenditure and that gigantic effort, we have done literally nothing for those people whom we set out to help and who most needed our help. I think that is nothing less than a national tragedy and it certainly ought to have been possible to have done more to relieve the slums by a colossal expenditure of that kind than has been done. I hope the Minister of Health before long will be able to bring in some Measure to do what is necessary to deal with slum houses.
The broad reason for this state of things is perfectly simple. It is due to the fact that the houses we have built have been so expensive that the people living in the slums could not afford the rent. This is to a considerable measure due to the very unfair and undesirable way in which our rating system works in making the new houses artificially expensive as compared with slum houses. If we take typical figures for a large provincial town such as Manchester, we find that the net rent of a slum house

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is about 5s. The net rent of the smallest family house into which a slum family could be moved and in which they could bring up their children in full health of body and mind is about 10s. I think public opinion is agreed that the standard of the smallest and cheapest house must be the A 3 type with three bedrooms, a bathroom and a garden. Hon. Members will agree that there is no real luxury in a house of that kind. It is the cheapest and smallest house in which a family can be brought up in a healthy state and it is the cheapest in which anyone ought to be asked to live. The rates on a slum house are about 2s. 6d. and the rates on such new houses are 5s.
What does this mean? It means that, if the father of a family living in a slum decides to make the sacrifice of 5s. a week, giving up small personal luxuries, and even necessities, so as to give his children a bettor chance by moving out to the suburbs, the municipality, instead of helping him, increases his rates by no less than 2s. 6d. a week. Such a tax on health can only be justified by overwhelming necessity. Now the increased tax on the suburban house corresponds to no increased burden on the municipality. This matter has been investigated, and I think it is generally agreed that the services to the family in the suburban house cost the municipality no more than those required by the family in the slum. On the whole the cost is probably rather less.
As regards ability to pay, it is to be noted that there is no luxury in the suburban house. It is the smallest house in which the family can be kept healthy and the family in the minimum family house has less ability to pay than the one in the slum by 5s. a week. As regards the cost of the family to the municipality, a family moving from a 5s. slum house to a 10s. house in the country will cost them rather less in the case of the expensive house than the cheap house. The charges in the case of the suburban house will be less in regard to everything connected with public health. On the whole there will certainly be no additional cost to the municipality. Under these conditions it seems incredible that we should increase the rent when a man moves out of the slums. The city fathers say, "We want you to get out of the slums and take your
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families to decent houses. We know it is going to mean 5s. a week more on the rent, and it will not cost us any more on the rates. We want to help you and facilitate your removal in every way. Therefore, we are going to double your rates." I think that is absolutely indefensible. This question was referred to in the Liberal Yellow Book—noted for the moderation of its language, as a thoroughly vicious system.
What is the remedy? The hon. Member for Blackley has indicated a remedy which some of us propose. If you look at the Income Tax in connection with the work of the Liberal party in the past, you will find all kinds of graduations and differentiations have been made to make the tax more in accordance with the real ability to pay. The Income Tax has been differentiated according to whether it is earned or unearned; there are allowances for children and many other ways of making the Income Tax really fair and effective. Further alterations are required, but I think the Income Tax is as good as any tax is likely to be in this imperfect world. The rates have been left severely alone as a percentage of the gross rent. In the case of rates there is no graduation according to income, no differentiation and no allowances for children. The only possible reason why the rates are levied in their present form is because they have been levied in that way for hundreds of years.
I suggest to the Minister of Health that here is an opportunity for the present Government to tackle this very large question of the rates with the same courage that the Liberal party tackled the question of the Income Tax. The present system of rating is quite intolerable. We propose that we should define the minimum standard house which will satisfy family requirements. We suggest £8 as a fair figure for a family house, and so that everything up to the minimum standard house should be rated at £8. That means that a man pays 2s. in rates in the slum and when he gets out into the country he still pays 2s. in rates. I ask the Minister of Health to consider whether some such step as that cannot be taken in connection with this forthcoming Bill. I trust that the Government, will deal courageously with this old and unjust system of taxation and remove the serious but purely artificial

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barrier which stands in the way of families moving from the slum areas into the country. I hope they will at long last make an effective beginning in the process of moving the children out of the slum houses into decent houses.
Mr. SAWYER: In rising for the first time to speak in this House, I should like to say that I have long held the opinion that the present rating system is responsible for the terrible housing shortage with which we find ourselves faced to-day. I was much impressed by the remarks of the Seconder of the Motion as to what the Liberal party had done in days gone by to improve the lot of the, people, and I think that, if the Liberal party had continued that policy, instead of running away from it after winning two elections on it, that party would probably be considerably larger to-day than it actually is. I hope that the Mover and Seconder of this Motion, and other Members of the Liberal party, will put pressure upon their leaders to take up that matter where they left it in 1914 and 1910.
The Seconder mentioned that we have spent £1,000,000,000 on the building of houses during the last 10 years, and that the position to-day is no better than it was 10 years ago. Overcrowding is just as bad, and nothing is being done for those whose wages are too low to enable them to pay an economic rent. The present rating system acts as a direct tax on housing. We often hear rates and taxes referred to as a burden on industry. Rates are a burden on the building of houses, and the building of houses ceases to keep pace with the population when the rates reach an excessive level. There are two factors which tend to retard the building of houses, namely, high rates and the high cost of land, and, until something is done in the direction suggested in this Motion, and something is done to make land cheaper, there will be no solution of the present housing problem. At one time, we had a great Colonial Secretary who thought it wise to apply the rating system of this country by putting a direct tax on the huts of West African natives, but the West African natives, instead of paying the tax, pulled their huts down and went to live in the woods. We cannot do that hero, because, in the first place, the
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climate is not suitable, and, in the second place, if people went to live in the woods they would find that the woods belong to someone, and that they were trespassers and violating the law.
I am sure that we shall have the Unionist party with us on this subject, because the Unionist party have brought in a Measure for the de-rating of machinery and agricultural land and factories, which might well be applied also to the de-rating of houses, and, if the Government would be kind enough to carry those de-rating proposals a little further, it would be possible to provide the houses that we need. In all our large towns there is a shortage of houses, and numbers of people are living under conditions which are terrible in the extreme. In the City to which I belong, and a Division of which I have the honour to represent in this House, we have done our best to provide houses for the people, and, speaking from memory, I think we have built more houses during the last 10 years than any other municipality. Our waiting list, however, is as large as it was in 1919, and it does not include newly married couples. We have upwards of 15,000 newly married couples living in rooms, and they are not registered with the Housing Department because they have no children. I have in mind one family that I saw on Saturday night, consisting of a man, his wife, and seven children, who were living in two rooms, one downstairs and one upstairs. The children were like steps, and they all slept crowded together in one room, unable to stretch out and grow, unable to breathe pure air, and thereby doomed to an early grave before reaching manhood. We have been battling against such conditions owing to high rates and high costs of land.
All Governments seem to lean towards the subsidising of the building of houses, but where has all this money gone that was mentioned by the Seconder of the Motion? It has gone into the pockets of landowners and contractors. If £1,000,000,000 has been spent on the building of houses during the last 10 years, it can safely be said that many landowners are millionaires. I hope that the Minister of Health, in considering the future policy of the Government, will extend de-rating to houses. The

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revenue that he will lose in that way he could get, as suggested by the Mover of the Motion, from a tax on land values, but I am sure he will be successful in providing houses. In the City from which I come, and I suppose in others also, if the council want to buy land they have to buy it through a third party. We must not let it be known that it is the council who want the land, because if we do an extortionate price will be demanded, and, therefore, it has to be bought through a third party. The Mover of the Motion mentioned the district valuer, but I have no faith in the district valuer. If you bring him in to arbitrate, he always bases his decision on the price for which the land was sold. A man sitting in New York would be able to give the same decision as the district valuer.
Before I came to this House I was engaged on the railway, and almost every night we had 15 or 16 trucks on the train with foreign tiles in them. We have to buy our tiles from France and Belgium because of the extortionate prices charged for our own materials. These tiles can be bought abroad, giving work to foreigners, more cheaply than slates can be bought in our own country. If the Minister will realise that fact, he will be able to find work for many of our people who are idle to-day. How is it possible for people abroad to provide tiles and send them over here into the Midlands more cheaply than we can manufacture them in our own country? [Interruption.] One of my hon. Friends says that it is because of the subsidy. I hope we shall hear no more of subsidies to these people, because they have not delivered the goods. If the Minister of Health will carry the de-rating proposals just two steps further, he will succeed where other Ministers have failed. He will be able to bring the idle builders to the idle building sites, and we shall soon see an improvement in the terrible conditions that exist in our country to-day.
Sir K. WOOD: I should like to congratulate the hon. Member for Duddeston (Mr. Sawyer) upon the speech which he has just made, many of the sentiments in which, so far as I was concerned, met with a most favourable reception. I was very glad indeed to hear his observa-
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tions on subsidies, to which I will refer in a minute or two. May I say, in the first place, how much I welcome the fact that the hon. Member for Blackley (Mr. P. Oliver) has introduced this Motion? There was a good deal in his remarks to which I cannot assent, but I do congratulate him on having been able to put down a Motion enabling us to secure a discussion in this House on the question of housing. It is a remarkable thing that, owing in no small degree to the ability and cleverness of the Minister of Health, we have been prevented from discussing housing matters in this House for many months. I remember very well that when we came back, and the Labour party, flushed with their success at the polls, introduced the King's Speech, the first thing that the right hon. Gentleman did was to put down a Bill to make further and better provision for housing in this country. It did not make much better provision for housing in this country, but it did effectively prevent discussion for many months, because, as you know, Mr. Speaker, under our Rules we were thereby stopped from raising the question of housing. The only opportunity that we have ever had, until now, of discussing any aspect of the housing situation, was when the right hon. Gentleman brought in a Housing Bill which I think he himself described as only a stop-gap Measure, and the present is the only other occasion on which we have been permitted by the Government to make any observations at all on the housing situation. Therefore, I congratulate the hon. Member for Blackley on his success. He has triumphed where a large number of people have failed, because many of us have been very anxious to discuss the housing situation.
Mr. FOOT: There are only four of you here.
Sir K. WOOD: There are only a very few on the hon. Member's own benches, and I see that even the Seconder of the Motion is not here at the moment. I think it is well that we should discuss the present situation, because things are not at all well at the moment with housing development in this country. The right hon. Gentleman may be able to give explanations later, but it is an extraordinary thing, which I do not think the country has realised, and which I am

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sure hon. Gentlemen opposite have not realised, because otherwise they would have risen to their feet long before now to call attention to it, that, according to the official figures which were given by the right hon. Gentleman a few days ago, the houses completed during the quarter ending in December, 1929, were 14,521, while the number completed during the quarter ending in December, 1928, under the retrograde Tory administration, was 26,858. Therefore, comparing these two quarters, there has been a decrease— [An HON. MEMBER: "Because you stopped the subsidy !"] The hon. Gentleman will, perhaps, give his explanation in a minute or two. No doubt we shall have many explanations, but the fact remains that there has been a decrease, comparing the quarters ending in December, 1928, and December, 1929, of no less than 12,337 houses. Whatever explanation it may be possible to give in this House for the decrease, it gives very little satisfaction to the people who need the houses.
The MINISTER of HEALTH (Mr. Arthur Greenwood): May I ask the right hon. Gentleman whether his figures for 1928 include the houses built under the 1923 Act as well as under the 1924 Act, and whether it is not the case that his Government abolished the 1923 subsidy?
Sir K. WOOD: Certainly. I include in these figures, as I have a right to do, all the houses that were erected under the respective Administrations. I include the houses erected under the 1923 Act, although I remember a speech of the right hon. Gentleman, when he was in Opposition, in which he told me that I ought not to count those houses. I do count them, however, and I compare for this purpose the numbers of houses erected during the Tory and Socialist administrations respectively.
5.0 p.m.
If I look at another important aspect of the housing problem—and this is why I commend the hon. Member for Blackley for bringing forward this Motion—it is not much more favourable. I have referred to the numbers of houses erected, but, if you look at the number of houses authorised, that is to say, the houses which we are to expect in the future, and which have been definitely adopted by the local authorities, the position is not much better. In the month of
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December, 1928, when hon. Gentlemen opposite were so critical, the number of houses authorised was 25,305. In December of last year, under this wonderful Government, the number of houses authorised was 19,829, n, decrease of 5,481. That is a very serious state of affairs. An hon. Member opposite, who will no doubt help to give an explanation later on, said it was something to do with subsidies. I was told, when I talked about subsidies on the last occasion, to look at Scotland, where there was no question of any alteration in the subsidy at all and where there has been no change in the position The last figures that were given in the House, which were for November, were 16,228, and this November the figure had got down to 9,613—a very extraordinary state of affairs.
Mr. OLDFIELD: On a point of Order. Is the right hon. Gentleman in order in continually comparing the figures for last year and this year when we are discussing the effect of the incidence of rating, and when there has, in point of fact, been no change in the incidence of rating since the Rating and Valuation Act 1925?
Mr. DEPUTY-SPEAKER (Mr. Robert Young): I have just come in and I did not hear the right hon. Gentleman's remarks.
Sir K. WOOD: Perhaps I may endeavour to persuade the hon. Member to listen to this very illuminating position. The hon. Member who introduced the Motion dealt at great length with housing development. He quite rightly called attention to the housing needs of the poorer members of the community. Anyone who looks at the housing situation to-day and for some time past is driven to the conclusion that the great necessity of to-day is to get houses at such rents as the poorer paid members of the community can afford to pay. That was the great ambition of the right hon. Gentleman the Member for Shettleston (Mr. Wheatley) when, with great distinction, he filled the office of Minister of Health, and he introduced a Bill for that purpose. I will not dwell too long on that effort because, no doubt, he would not desire me to do so, but the fact remains that, whatever efforts have been made,

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you are bound to come to the conclusion that to a very large extent rent depends upon the cost of the house. According to official figures, there has been a considerable increase in the cost of non-parlour houses. In December, 1928, the average cost of a non-parlour house, according to the statement of the right hon. Gentleman himself, was £338.
Mr. OLDFIELD: May I repeat the point of order that I put a few minutes ago?
Mr. DEPUTY-SPEAKER: I have looked at the Motion, but I am in a difficulty, because I have not heard what the Mover and Seconder said. The Motion is quite definite.
Sir K. WOOD: I think I can submit quite confidently that I am in order, but I will not try the hon. Member's patience much longer on this phase of the matter.
Mr. MacLAREN: It is true that the Seconder of the Motion traversed a pretty wide field and he was not called to order. I am merely intervening in the hope, seeing that liberty was allowed, that the Debate will not be held within too strict limits.
Mr. DEPUTY-SPEAKER: The Motion itself is certainly not very wide, but I think if they dealt with these matters I should let the right hon. Gentleman reply to the Mover and Seconder.
Sir K. WOOD: I am very much obliged to the hon. Member, whom I look upon as a real friend. The increase in the cost of the non-parlour house is £32 for December compared with the previous December.
Mr. OLDFIELD: I really must press my point of order. It is quite a simple one, that because there has been no change in rating in the last few years the right hon. Gentleman is out of order in comparing costs this year and last year and the year before. That was not done by the other speakers.
Sir K. WOOD: That comparison was not made because I do not think the hon. Member had it with him, but he emphasised that the great problem that was facing us was the cost of housing. During the last three months the number of houses erected and authorised has gone down, the cost of housing has increased
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and there are many more thousands of building operatives out of work to-day than there were a year ago.
I now come to the remedies that the hon. Member has suggested, and there I must part company with him. I commend him for bringing the subject of housing before the House, but I cannot say he has chosen two of the best remedies for relieving the present situation. He has, in the first place, chosen street paving, and he has suggested that some alteration should be made in connection with the present rating system so far as new houses are concerned. I was not able to follow him in his complaint with reference to street paving charges. I do not know whether he has followed the exact position of people who suffer from excessive demands in relation to street paving charges, but the position is a perfectly simple one. It is true that a number of people, to my knowledge, have very heavy demands made upon them, but I cannot conceive that for that reason there is any necessity or desire, either on the part of local authorities or the great body of people concerned, to alter the law. When you buy a house the first question you should naturally put is, "What are the outstanding charges?" You have only to go to the local authorities and ask if there are any charges outstanding in respect of street paving, and they will say, "Yes," or "No." They will not give you an exact figure of what the cost will be, but I do not think there is a single local authority which would not give a prospective purchaser an estimate of the cost. If you go to any building society, through which a very large number of these houses are being purchased, they will tell you that the very first thing that has to be considered before they make a loan and authorise a house to be purchased is whether there is any sum outstanding in respect of street paving charges.
That is a matter that has to be taken into account when you fix the price you are going to give for the house. If there is a large sum of money, for instance, £150 or £200, that is a very grave matter which you must have regard to in the price you are paying, but the only class of case I can think of where there is a real hardship is where, through eagerness or ignorance, people have actually purchased a house without making that very necessary inquiry. But that is hardly a

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reason for altering the law. Even when a purchaser is confronted with a very heavy bill in circumstances of that kind I do not know of a local authority which is not prepared to allow the amount to be paid in instalments. Therefore, I cannot congratulate the hon. Member on seizing on street paving charges and saying that is stopping housing development, because it is not. Are you going to say that the old inhabitants of an area are to pay the street paving charges for the newcomers? Surely that is an impossible proposal. Is the hon. Member suggesting that the State should pay it, and has he calculated what the cost will be? If you put the average street paving charges for new houses at £25 apiece, you realise what an enormous burden that would place upon the State, or upon the other inhabitants of the district.
Anyone who looks at this from the point of view, not merely of housing, but of common sense must see that it is not street paving that is hanging up housing development to any extent. It is not a practical proposition to say that the other inhabitants of the place shall pay the street-paving charges of the newcomers, and it is not reasonable that the State should do so. I have thought over this matter on many occasions because when I was engaged in professional work I constantly came across it. The only thing which you can say is unfair is that in a very large number of cases a new inhabitant will be charged the full rates for services which are not really available to him. It is very difficult to think of any system which would differentiate fairly in that respect. Therefore, anxious as I am to see housing progress, especially under present conditions when things are by no means good, I cannot look with any hope upon the suggestion which the hon. Gentleman has made with regard to street-paving charges. I confess that it does not appeal to me.
What is the other proposition? The other proposition has reference to the effect of the present rating system on new houses. I listened to the speech of the hon. Gentleman with the greatest possible interest. What did he tell us should be done in order to bring about the change he desired? He said that there must be a complete change in the rating system, the rating of land values, a local income tax, and a differentiation in rating.
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Even when you consider the position of the right hon. Gentleman the Minister of Health, with all his ability, this is a lot to ask him to do in his new He using Bill. I do not care to prophesy, but I do not think that we shall see in the new Housing Bill of the Government any of these four things. I think that even the right hon. Gentleman would be sufficiently cautious and sufficiently practical to know that housing development cannot be advanced at any quick pace by means of propositions of that kind.
I will address a similar question to the hon. Gentleman which I have already put to him and to the hon. Gentleman the Member for Withington (Mr. Simon) with regard to this suggested differentiation in the rating of the owners of new houses. Who is going to pay for it? Is it to be the other householders? Is it to be industrial property? What is the position at the present time? The hon. Member seemed rather inclined, in connection with this new rating system, to favour the idea that the old inhabitants in a district should pay the rates, thus giving some special concession to the new owners. At the present time, I do not think it is inaccurate to say that the municipal houses which have been erected by the efforts of the local authority and by the State are already costing the ratepayers and taxpayers from £4 to £6. In other words, for every new house that goes up, the average working man who is, we will say, living in an old house, and whose necessities are probably just as great as those of the people who are occupying new houses, is really making a very considerable contribution each year to the owners in the new houses. The only justification for this is the necessity of the housing situation.
It is, however, very difficult from the point of view of justice and fair play to defend a proposition that a working man living in an old house and probably without the amenities and conveniences of a man similarly situated as far as industrial status is concerned, and occupying a new house, should make a contribution in respect of these new houses. As far as I can follow the hon. Gentleman, the proposition is that some further contribution, either from the rates or from the taxes, should be made by these people who are already contributing to the cost of new houses occupiel by other people. I think it may be

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said that perhaps something like 15 per cent. of the rent of the people who occupy what you may call the new houses in the country is already being paid by the taxpayers and the ratepayers, who include a very large number of working men and women. Therefore, I should hesitate very much before I assented to a proposition putting further burdens on a large number of people who are already making their fair contribution.
The hon. Gentleman in his Motion makes no differentiation whatever as to the type of new house, and that is why I cannot see how anyone can accept it. There are all sorts of new houses going up in this country. There are new houses of a considerable value. Does he suggest that there should be some differential rating system for houses of £1,000, £1,500, £2,000, and £2,500? Is that the suggestion? I do not think anyone could assent to that. He does not say in his Motion that these new houses should be occupied by members of the working-classes. It is an impossible situation. He falls back, as one would naturally expect coming from that quarter, upon land values. I want to stand up and protect the right hon. Gentleman the Minister of Health in this matter. Does the hon. Member really expect the right hon. Gentleman in his new Bill to introduce the rating of land values? I hope that the right hon. Gentleman will be wise enough to leave that matter to the Chancellor of the Exchequer who may be foolish enough to do it. Nobody interested in the speeding up of houses would suggest that anything is going to be done by the rating of land values. I have a quotation here which I hope the hon. Gentleman will take home and study. There has been a recent report issued on the finances and financial administration of New York City, where rates are raised by a tax on the capital value of land and buildings. There you have a case where this system is really in operation, and where these theories can be tested. This is a quotation from a report by a committee, which, I contend, we are entitled to respect. They say:
"There is, however, in the community a general conviction that the Real Estate Tax is to a very considerable extent at least shifted to rentpayers, and that in the case of home-owners, the burden of the tax, with assessments at their present level, has
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become so great that it is inadvisable to increase it.
That is practice and not, theory. That is what is actually happening. Therefore, I hope that the right hon. Gentleman will not be tempted by the proposition which has been made by the hon. Gentleman that the quickening of house production in this country can be achieved by the taxation of land values. No, we must look in other directions for the acceleration of house building which is so badly needed in this country. Not only has this Government failed as far as unemployment is concerned, but it has failed as far as housing is concerned. It is a very unfortunate sign of our national life that in two things which matter so much the Government should have proved such an abject failure. Unemployment going up; progress on housing corning down ! You cannot think of anything more disastrous. The best thing for the right hon. Gentleman to do would be to follow the advice and the successful plans of his predecessor in office, my right hon. Friend the Member for Edgbaston (Mr. Chamberlain), whose name will always be associated in this country with the greatest record with housing which we have ever known. The right hon. Gentleman had better turn back. He was warned when be interfered with the subsidy by the right hon. Gentleman the Member for Edgbaston from one point of view, and he was warned from these benches.
Mr. DEPUTY-SPEAKER: I am afraid the right hon. Gentleman is widening the Debate.
Sir K. WOOD: I will content myself by saying that it is not along this path that we should travel for housing, and, also, that it is not along the path which the Government are at present treading, because that path is leading to less house building. I will invite the House to imagine, since I am not permitted to indicate the way, that there is another and a better way to improve the housing accommodation in this country.
Mr. DEPUTY-SPEAKER: Before I call upon another speaker, I should like to say, seeing that there was some misunderstanding in regard to what was said by the Mover and Seconder of the Motion, that I hope hon. Members will keep to the Motion.
Mr. MARCUS: We are much indebted to the hon. Member for Blackley (Mr. P. Oliver) for introducing this Motion and affording the House an opportunity of again discussing this interesting subject. This matter of the incidence of rating has been repeatedly investigated by several Royal Commissions in the past and also by numerous Departmental Committees. This afternoon, I think the House will be in general agreement upon the nature and extent of the disease. Where we differ fundamentally is upon the question of the remedy. The Royal Commission which sat in the year 1896 ventured for the first time to differentiate betwen classes of services in respect of which rates are levied. They created for the first time a division between onerous and beneficial services, and unless we examine the nature of those services, we shall be unable to get down to the fundamental nature of this problem and find a remedy for it.
What is the purpose of a local rate? It is meant to provide in the aggregate for certain services which I have said are of a beneficial and onerous character. What do we mean by that? Onerous services are, of course, services which are connected fundamentally with national or semi-national or Imperial services. They go outside the local area, while beneficial services on the other hand are services which deal entirely and exclusively with local needs in an area. In my judgment, the real problem in regard to this matter is that we must find a new system of rating, if we are to remove the difficulties raised by the hon. Gentleman who introduced this Motion, which will place the assessment of rates in respect of onerous services upon a sounder and more equitable footing. As far as inequality is concerned, it exists almost exclusively in onerous services. If we recognise that fact and are in agreement upon it, we can move to an examination of the suggested remedy. My hon. Friend the Member for Burslem (Mr. MacLaren) will, no doubt, attempt to deal adequately with the device for the rating of land values. I do not propose to deal with that subject, but I wish to concentrate upon the question of local income tax. I should like to say, in passing, that I do not regard the device of local income tax as in any way inconsistent with the con
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ception of the rating of land values. I think that one is the supplement and the complement of the other, and that we could apply the two in a properly balanced rating system.
If I had time this afternoon I should attempt to deal exhaustively with the proposals submitted to various committees by Sir Henry Keith, in the field of local taxation. I am an enthusiastic supporter of his conception of local income tax, although I concede; that his views have been subjected to serious criticism. It has been doubted whether a system of local income tax could be applied in practice, but those critics who look upon the scheme as impracticable must recognise that the present system has reached a stage at which it is impracticable, and is breaking down. It is a burden in every respect and is bankrupt, and because of that fact it is not for us to say that this or that proposal is impracticable, and leave the matter there, but we must try to modify proposals, whether made by Sir Henry Keith or anybody else, with a view to introducing them into local taxation.
What do we mean by local taxation? The system of national taxation recognises the cardinal principle of ability to pay. Unless we recognise that system in any rating system we are entitled to say that that system is bound to fail. It is not merely a matter of checking housing development, of checking agricultural development, or of checking industrial development, but it is a matter of checking every possible social development. In Scotland, and I think also in England, so far as I understand English rating law, the rates are levied exclusively on what are called lands and heritages, houses and shops. In Scotland, and here I am giving official figures, only one-sixth of the total taxable income for national taxing purposes is represented by lands and heritages, houses and buildings, while the balance, five-sixths escapes entirely from the burden of local taxation. The scheme devised by Sir Henry Keith seeks to remove that inequality. It is proposed that some kind of system similar to that operating in national taxation should be introduced which will distribute the burden more equitably and, as a result, remove the burden which weighs far too heavily upon the shoulders of the occupiers of lands and heritages.

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When we make a comparison between the position occupied by the owner of a house and the occupier we must never lose sight of the fact that the owner, even under the most difficult circumstances, has something as an asset; he has something which adds to his income. The gross or net rent, no matter how low it may be, does ultimately add to his income. So far as the occupier is concerned, the opposite is the case. The rent is a liability which has to be paid out of his income, and it is bound to reduce his aggregate income. He is, therefore, in a position which entitles him to demand that he should be dealt with more equitably. I am not concerned with that point at the moment, but I hope that something will be done to deal with it within the range of our rating system.
To get back to the device of local income tax, I would say that while there are numerous difficulties and complexities associated with the application of the principle, I fail to see what is to prevent the Treasury making an addition to the amount of national taxation of so much per pound in respect of local services of an onerous character, of a semi-national or imperial character. Once that addition has been made I fail to see why we should be unable, with all the expert knowledge at our disposal, to divide the revenue derived in that way between the various localities, in accordance with the estimates of expenditure made each year. When I am told that the scheme is impracticable, I reply that there is no substantial scheme for changing any important system ever been submitted to any body of thinking persons that has not been subject to the criticism that it is impracticable. Every new system is, to some extent, impracticable, but we in this House are here specifically because of the fact that certain schemes have to be evolved and hammered out, and the impracticabilities removed. We have to try as far as possible to find a solution for the problems that beset our present rating system.
This Debate has had one really interesting feature, and that is that the Conservative party offer no remedy. They level criticism at the rating of land values and at local income tax, although its chief exponent is Sir Henry Keith, a prominent Conservative in Scotland, the
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ex-Provost of Hamilton, a man who has devoted his life to studying rating problems. The Conservatives offer nothing as an alternative to enable the House to decide on the question now before it. Why is it that when a fundamental question of this kind is being considered, the Conservative party do not feel themselves called upon to submit to the House something practical, something which will reconstruct the whole of the rating system under which we live, and something which will let the people see that they really have practicable proposals to bring forward? They obviously cannot disagree with the conclusions that have been reached by recent Royal Commissions. I propose to deal with one conclusion which was reached by the Departmental Committee on Local Taxation, which sat in 1922. Here is their final conclusion:
"As our fundamental conclusion we express the opinion that the existing system of rating is overburdened and near the breaking-point, and that rigid economy is called for, not only as a measure of financial justice, but to avoid the social Catastrophe which is inevitable if new enterprise in house-building, agriculture and industry continues to be chocked by the undue use of a system of local taxation which relies on rates on land and buildings as its sole fiscal expedient."
If I understand the Conservatives' philosophy aright, one thing to which they are very hostile is social catastrophe. Nearly every Conservative speaker in this House and outside devotes a considerable proportion of his or her speech to an exposition of what he or she regards as social catastrophe, violent revolution and so on. Here is an excellent opportunity for hon. and right hon. Members opposite who constitute the official Opposition to tell us exactly what they suggest as a solution of this intricate problem. I had the privilege of sitting for three years on the Edinburgh City Council just prior to coming to this House. We discussed in that Chamber the whole question of rating, and I am glad to say that in Edinburgh and in other parts of Scotland there is an increasing body of opinion coming round to the conception of local income tax as a new solution of the problem that faces us. It is not the only solution, but it is a step in the right direction and, above all, it recognises the cardinal principle which ought to underlie every rating system, namely, that those who are able to pay should pay their

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share, and that those who are unable to pay should not be called upon to pay a share which is payable by those who have the money with which to pay.
Mr. TRAIN: It is unnecessary for me to claim the indulgence which the House generously gives to one who rises to address it for the first time. I would not have troubled the House on the present occasion had it not been for one or two things which have been said by the hon. Member for Blackley (Mr. P. Oliver), who introduced the Motion. I must congratulate the hon. Member for Dundee (Mr. Marcus) on his adherence to my great friend Sir Henry Keith. We Lanarkshire men all admire Sir Henry Keith. He has sat on every form of local government and has made many attempts to become a member of this House, but the electors would not have him because of his ideas on taxation. I do not disagree entirely with what Sir Henry Keith says about income tax.
The hon. Member for Blackley began by telling us about the cost of street paving. Probably in Scotland we are better off in that respect than those on this side of the border. The hon. Member talked about the owner of a house of the value of £450 having to pay something like £250 for street paving, while the owner of another house had to pay £170. That is beyond my comprehension. The average price of street paving in our part of the country is about £l per running foot in a 40 feet wide street. The owner bears half the cost, which for the street amounts to £2 per running foot. Suppose the site of the house is 40 feet and you are building four houses in a block, the cost is only £20. The hon. Member suggested as a remedy for these paving charges that we should make it a communal burden. I disagree with that suggestion. I think that the ratepayer who is not fortunate enough to be living in a municipal or council house is paying enough for the people who are fortunate enough to occupy those houses. We have in Lanarkshire, as the right hon. Member for Shettleston (Mr. Wheatley) well knows, because he has taken a great interest in housing, a rat" for housing of 10d. in the £ in some districts. In Glasgow the rate is something like 4d. To ask the ratepayers to contribute more towards the cost of the
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houses that more fortunate people are occupying, would be a shame.
I put a question to the Secretary of State for Scotland recently as to the number of people occupying these subsidised houses who drive their own motor cars. He replied that he could not tell me. There are a number in Glasgow who lave had garages built in connection with the subsidised houses, and they ace driving their motor cars to-day. Some of them sold their houses in order to go and occupy a house that had been built by the taxpayers' and ratepayers' money.
Mr. JAMES STEWART: Will the hon. Member give details?
Mr. TRAIN: I could give details. The hon. Member knows them himself.
I come next to the question of taxation. It has always been a great puzzle to me why a man's contribution to social services should be according to the valuation which an assessor puts upon his house. It does not matter whether he has five in family or 10 in family, or no family at all, his payment towards social services is based on the valuation of his house, and I think a great deal can be said for the argument which has been used in the Debate to-night. In regard to the question of slum clearances I had the privilege of reporting on the Addison scheme of 1921, and of turning it down, so that I know something about the question. The sooner our slums are cleared from our great cities the better it will be for the good government of this country.
Many local authorities are finding a difficulty in letting the houses they are building. Hon. Friends of mine who have sat with me on the Glasgow City Council and on the Lanark County Council know that both Lanark and Glasgow are finding a difficulty in letting many of the houses which have been built. What is really wanted is a house of the size and rent which people can pay. It can be done, and it has been done in Lanark and in Glasgow, but there are far too many of the bigger houses built in districts where the cost of transport means an extra 10 shillings or 12 shillings out of the family income. The workman wants to be housed near his work, and I suggest to the Minister of Health that when he brings in his Bill for

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slum clearances he will consider a suggestion which I desire to make. There are many tenement houses in Glasgow with good walls and roofs, and the people who occupy them are helping to pay the rent of those who are more fortunate in living in council houses. A little modernising of these houses, the provision of kitchenettes, bath-rooms, hot and cold water might, be considered. Let me tell the House an experience I had at Alexandra Park—
Mr. DEPUTY-SPEAKER: I do not want to be too hard upon the hon. Member who is making a maiden speech but he is turning away from the subject of the Motion.
Mr. TRAIN: I hope the House will excuse me. I am really speaking what is in my mind, and I must apologise for wandering from the subject. What I want to say is that we must really apply our minds to the housing problem. The Report of 1917 is always brought before us and we are trying to live up to it. Let us benefit by the experience of the past in the matter of housing and do our best to house those people who have been neglected since 1919, even with all the housing that has been done. We must get rid of slums, and in the towns the streets are already made. There is no question of subsidising the landlord by making roads. A landlord should develop his own land and after the road is made then the council should take it over. People should not buy a house without seeing that the road charges are properly discharged. Whatever may be done, I hope that we shall see to it that no further burdens are placed on the people in connection with the building of houses.
Mr. JAMES WELSH (Paisley): My first duty is to congratulate the hon. Member for Cathcart (Mr. Train) on his maiden speech. We shall look forward with interest to his future contributions to our debates, but I may add that probably he will encounter considerable criticism if in his future speeches he takes the line he has taken to-night. The subject which the House is now discussing is one of great importance, and I must add my thanks to the Mover of the Motion for giving us an opportunity of debating it. I was delighted to hear the speech of the
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hon. Member who seconded the Motion, and I can bear testimony to the excellent work he has done in connection with housing reform. My only comment on that is that I wish the enthusiastic housing reformers in the Liberal party would spend a portion of their time in converting some of the Liberals in Scotland. Their idea of a good standard of housing is very different from what we hear is the official programme of the Liberal party. I have given a little study to the question of the incidence of taxation. My attention was particularly drawn to it in Glasgow by the stories we had as to the rents which were being charged in England. We were told that in some districts in England they had managed to build and let houses at 5s. and 6s. per week, and when that story was investigated we found that the incidence of rating had a great deal to do with the rent. Bad as is the system in England it is very much worse in Scotland, probably due to the fact that in Scotland the rates are not paid entirely by the occupier but are divided in varying degrees between the owner and the occupier. There was an idea that by this method the occupier was escaping some of the burden.
Whether that was the case or not previous to the municipal housing development schemes it no longer obtains, because local authorities in building houses and making up their estimates take into account what they as owners are paying by way of taxation and strike the rent with that consideration in mind. The result is that the tenant is paying all the rates in ordinary corporation houses which are let at 14s. 7d. inclusive. I took occasion to work out the incidence of rating as applied to those housing schemes where we were making an attempt to keep down the cast to suit those who were occupying slum dwellings. Taking the average rental paid by the tenants of these slum-clearance housing schemes at £13 10s. per annum or 5s. 2d. per week, or including occupier's rates, 7s. 3d. per week, the net rent which they are paying as occupiers is about 3s. 7d., the difference being the owner's rates. It is quite evident that the element of rates enters into the question of housing to an extent which makes the difficulties of local authorities

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much greater, and also makes it more difficult for those people who want to improve their housing conditions.
From the point of view of improving housing conditions in this country there is no bigger obstacle than the present incidence of rating and any Government that wishes to do something in this matter must tackle this difficult and intricate question as soon as possible. We are all agreed as to the disadvantages of the present system, but when we look for a remedy I am afraid it is not very easy or simple. Personally I should prefer almost any other way of raising money for local purposes than the present method, because the tax on house accommodation is a tax that bears heavily on those who need accommodation and affects the whole of our social problems. If any Government by the taxation of land values can bring in enough revenue to pay for the expenditure of local authorities in this country then the sooner we have it the better. But I am not of that opinion. Whatever contribution we may get from the taxation of land values, it is not going to be sufficient for many years to come to pay for the expenditure of municipal corporations on social services.
I think we should ask the Government, in formulating any new social schemes, to keep this in view, that every scheme which is going to add to the burden of local authorities is going to make the housing problem more difficult. The proposal to raise the school-leaving age to 15 will add to the burden of the local ratepayers of Glasgow £100,000 per year, and if the local ratepayers are to pay up to 45 per cent. of that amount, as is contemplated, it is bound to add not only to our housing difficulties but to the difficulties of local government as a whole. In view of the difficulties of local authorities at the moment the Government should put as little additional burdens as possible on local authorities and every effort should be made to raise money in such a way as not to add to the burdens of the ratepayers.
6.0. p.m.
Mr. LOUIS SMITH: I welcome the opportunity to discuss this important matter, and I congratulate the hon. Member who moved the Motion on his
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success in the Ballot. I cannot agree with his suggestions for a remedy in connection with rating and the cost of the roads. It is rather surprising to hear from the Liberal Benches again the suggestion of the taxation of land values, having in mind the lamentable failure of such an attempt to raise revenue some years ago by the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George). Having regard to the fact that housing was put back by many years owing to the taxation of land values, I cannot think that the Government are likely to adopt the suggestion at the present time. Then we had the suggestion that the cost of the streets should be a communal burden. It is rather surprising that that suggestion should come from the Liberal Benches, because I seem to remember that for many years the right hon. Member for Carnarvon Boroughs has stood definitely for economy, and we should not get much economy if every landowner in the country knew that his streets were to be provided for him, that all he had to do was to build houses, and that the community would provide h m with the means of getting to the houses.
An hon. Member on the Government side of the House said that the Conservative party had no remedy to offer at the present time. If we look back to the history of the two or three years previous to last June we find that more houses, particularly those required by the poorer population—those whom, for lack of a better word, I call the working classes—were built in those years than in the preceding years. It is not for us to suggest a remedy when our record previous to the last election is so excellent compared with the record of previous years. If the hon. Member who made that statement about the Conservative party had spoken to his own Front Bench and had suggested that eight months was rather a long period to elapse before this important matter had had consideration, with the result that at the present time we have more building trade operatives unemployed than previously then—
Mr. DEPUTY-SPEAKER: I would remind the hon. Member that the Motion refers to the incidence of the rating system and to street-paving charges.
Mr. SMITH: I would like to refer to the difficulties that those who have been attempting to clear away slums have had in connection with the cost of rates and streets. I personally have had a good deal to do with the clearing of some very bad slums in the city in which I am living. It was with the greatest difficulty that we could build houses at rents which the poorest section of the population could afford to pay. In the building schemes of the local authorities, the rents, including the rates, amounted to 9s. to 9s. 6d., and it was certainly not possible for those whose income was round about £2 a week and less to pay that sum. It was only through the efforts of a voluntary organisation that was brought into being that £70 a house was found to supplement the cost of these buildings and the cost of streets and drains, etc., and that a rent of 6s. 6d. per week, inclusive of rates, was made possible. Of this 6s. 6d. per week paid by the tenant no less than 4s. represented rates.
The proposer of the Motion to-day suggested that the rates in the case of old houses were approximately 2s. It will be seen, therefore, that the cost of the rates in the case of these newer dwellings was just double that of the older ones. I do not know whether the Minister can influence the local authorities to assess the rates on these workers' dwellings according to the accommodation. I think he will find in many districts of the country that houses of similar accommodation are rated at varying figures. In fact I know that in my own area houses of similar accommodation are being assessed at anything between £11 and £19 a year, which seems a very big variation.
One speaker has said that he was strongly in favour of withdrawing the subsidy. I for one feel that we could help to reduce unemployment very considerably if we could attract the private builder into this trade again. The private builder certainly built a tremendous number of houses in the past, particularly during the years to which I have referred. Every effort should be made by the Ministry to attract the private builder into the trade rather than to depend merely on the houses that are built by direct labour under the municipalities. With regard to the cost of roads, attention should be drawn to the fact that some local authorities are de-
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manding that subsidiary roads, roads that lead nowhere except to the particular dwellings which they serve, should be constructed in exactly the same way as main roads. The cost is far more than is necessary. Sometimes I fear consideration is not given to the purpose for which a particular road is to be used. I have in mind a road which was built to serve seven small houses rated at about £18 per annum. These houses were seven of 15 built on a plot of about two acres. The eight other houses were built on the front and with no expense for road making. The road supplying the seven houses was a dead-ended road with a circle at the dead end for traffic to turn road. The cost of that road was no less than £539.
On the outskirts of a town if such a road had been left with grass around the asphalte of the path, and if the road itself had been made to carry traffic of the kind that would use the road, the expense would probably have been reduced by half. That is a way in which economy could be exercised and builders of small dwellings could be assisted. There ought not to be the great expense of kerbing and channelling and the laying of concrete slabs on every path and the construction of a roadway suitable for carrying eight ton lorries. Such construction is quite unnecessary in the case of a road serving cottage property. One speaker on the Government benches has said that he did not consider wide streets were necessary. I strongly oppose the idea of reducing the width of our main roads, and I hold that even our subsidiary roads should be kept up to the width that is adopted to-day in the majority of our cities. If possible we should go even beyond that width, as is done in several countries of Europe.
I have visited Holland frequently. When the Minister is considering the question of reconditioning houses, such as those to which an hon. Friend referred in an able maiden speech, I think it would be well if one of his representatives visited Amsterdam and The Hague and one or two other cities where big blocks of dwellings have been built. He could study the method of housing the people in those big blocks, and he would possibly learn a great deal of the inside arrangements that could be fitted into the good shells that we have in some parts of the country. These re-conditioned

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houses would provide suitable dwellings for working-class people, who would not be taken away from the centre of the city as far as is now necessary in the case of smaller dwellings in the country districts. I hope that no suggestion for paying the cost of street making out of public funds will ever be considered by the Minister. It seems very strange indeed that Members of the Liberal party should suggest such help for the landlord, for that is what it amounts to. I would urge on the Minister the necessity for clearing a great many of the slums which exist. Such work would help greatly to lessen the numbers of the unemployed. I hope that the Minister of Health will not wait any longer, but will get busy at once on the problem.
Mr. GREENWOOD: I am very glad to have the moral support of the hon. Member who has just spoken on the question of the urgency of the problem to which he has referred. But I find myself in some difficulty regarding this Debate, because up to now it has ranged over a very wide area. It has indeed been, if I may use the expression, a "preliminary canter" in anticipation of the Debate on the Bill which will shortly be before the House. It has raised questions of future general policy which obviously cannot be discussed on this occasion, and it has also been a preliminary to the discussion of my administration, which can be raised at any time by hon. Members opposite on the Estimates of my Department. I have no intention, however, of following certain of the speakers in dealing with questions which are entirely outside the range of this discussion, except to reply to the right hon. Gentleman the Member for West Woolwich (Sir K. Wood) who spoke about the failure of housing administration under this Government. I should not myself have gone into any irrelevant matters if the right hon. Gentleman had not insisted himself on being irrelevant. With his customary carelessness and lack of understanding of common figures, the right hon. Gentleman quoted statistics which he himself knows must create a wrong impression on the minds of people who do not know, how to use them, and I must, in my own defence, say something about the figures which he quoted.
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What was the right hon. Gentleman's case? It was that fewer State-aided houses had been built since the present Government came into office than before. That is perfectly true. But who is primarily responsible for it? The right hon. Gentleman himself. He, in his wisdom, with the right hon. Gentleman the late Minister of Health, decided to drop the subsidy on what are called Chamberlain houses. As I have said before in this House, far be it from me to question the right hon. Gentleman's wisdom on that matter, but the result has been that in the last three months of last year there were no Chamberlain houses built and completed. I am not responsible for that result. But apart from that, in so far as State-aided houses are being built to-day, the numbers are steadily increasing; and if we are to com-pare like with like, we must consider the houses completed under the Act of 1924. The right hon. Gentleman quoted figures for the last three months of 1928 and the last three months of 1929. Let me give the House the really comparable figures—which the right hon. Gentleman would not have ventured to give, because they would not have assisted his case. In the last three months of 1928 the number completed was 12,661. In the last three months of last year the number was 14,507. Therefore, the number of comparable houses, built with State assistance, was increasing. If the right hon. Gentleman says that the private builder who was building under the 1923 Act is not building now, then he misled the House, because he said, and the right hon. Gentleman the Member for Edgbaston (Mr. Chamberlain) said, "When we drop the subsidy on the 1923 houses the private builder, this public-spirited servant, will still continue to build houses." If those houses are not there—and the right hon. Gentleman has not said whether they are or not—the responsibility is not mine, but his.
I am sorry to have been diverted to a matter which is not really appropriate to the Motion before the House. The Motion of the hon. Member for Blackley (Mr. P. Oliver), which he introduced in an interesting, logical, and very sincere speech, is primarily, concerned with the reduction of the cost of houses. The hon. Member drew special attention to two charges—the charge for street paving and

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the incidence of the present rating system. I gather that the Mover suggests further public assistance, whether by reducing the street-paving charges through some additional form of public grant, or by means of de-rating. The point is that what is being asked for is another subsidy. I have never been against subsidies; but I would rather have an honest straightforward subsidy, stated in terms of so many pounds and so many shillings, than what is, in effect, a hidden subsidy. Proposals are continually made for reducing the cost of house building, but in nine cases out of ten the proposal is in effect one for a hidden subsidy. My own view is strongly in favour of an open subsidy, so that the public may know precisely what we are doing out of public funds to assist housing.
The position to-day is that under the Act of 1924 passed by my right hon. Friend the Member for Shettleston (Mr. Wheatley), a subsidy was given which was a substantial contribution to the cost of housing. If we take the existing subsidy of £7 10s. per house per annum, the capitalised value of that subsidy amounts to £129. If we take the subsidy at present operating in agricultural parishes of £11 per house per annum, the capitalised value is £189. At the present time the average cost of State-assisted houses is between £300 and £400—about £350 in the case of non-parlour houses, and £390 in the case of parlour houses—so that at present the State is contributing something like one-third of the cost of the publicly-assisted houses which are being built. I do not mind the House pressing for a further addition if they think it right to do so; but I would rather give it openly and frankly than in a way which savours of what I may call tariff policy.
Attention has been drawn to two special problems, and the first is the question of street charges. I feel that this is a problem into which there ought to be some definite inquiry. It is true that the situation has changed. It is probably true that local authorities are demanding roads which are in excess of requirements. There may be something in that view and I have already promised in the House that that matter shall be investigated. Already discussions have taken place between officers of my Department and some representatives of the Institu-
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tion of Municipal and County Engineers to consider, not merely the cost, but the incidence of the cost. That inquiry I hope we shall pursue, and it is not necessary therefore for me to go further into that question at the moment.
With regard to rating. I have never pretended to defend the present rating system. It is hopelessly antiquated. It is quite out of touch with modern circumstances and requirements, and it leads to anomalies. It does not fulfil the condition which we have been told, the Income Tax more or less fulfils to-day, namely the apportionment of charges in accordance with ability to pay. I am not going to defend the present rating system but I cannot accept the view that the right way out is a local Income Tax. That is far too "chancey" a way of dealing with this problem. I can imagine some secluded village in Sussex, fortunate in having in its midst a multimillionaire, and an equally secluded, equally worthy village somewhere else, with no millionaire; and because of the accident of the habitation of the millionaire, one local authority would have practically no rate to levy on the rank and file, while the other would have to levy a relatively heavy rate. If Income Tax is of any value at all, it is a tax which must be levied nationally, for the income of a person does not necessarily derive from his residence in a particular area. Therefore, I could not subscribe to the theory that Income Tax should be made a locally-administered tax, as a great reform of our rating system. Then we have the proposal that there should be some more de-rating. Last year I said that there was far too much de-rating, and I believe that to be true. We have already de-rated far too many people who ought to bear local burdens. It is not going to help local authorities who today find themselves with restricted resources, to pursue still further this suicidal policy introduced by the late Government.
Sir K. WOOD: And continued by you.
Mr. GREENWOOD: Moreover, as between particular classes of house occupiers, it is not right to de-rate people who happen to be fortunate enough to live in new houses, at the expense of people who live in old houses. The truth is that the problem of rating cannot be

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dealt with as a side-line to the housing problem. Many of these matters it is true are closely related, but the problem of local rating raises far more questions than those affecting the provision of working class dwellings, and it would be no more possible to undertake a drastic reform of the rating system in a Housing Bill than to introduce the Budget in a Housing Bill. I should be only too glad if I could solve all our social problems in the Bill which will shortly be placed before the House. If we could deal with rating and many other allied social problems in one Bill—above all, if we could carry out that famous idea of the one-Clause Bill—nobody would be more pleased than I would be. I would then be able to kill not two birds but many birds with one stone. But in a Bill dealing with the problem of housing one cannot deal at the same time with a large number of other fundamental questions which, while quite appropriate for other Measures, can be no part of a Housing Bill.
We have been asked about rent restriction. Rent restriction has its own code of law and is separate from the problem of the provision of new houses. Bating has its own code of law, and it is something much more far-reaching than can be dealt with in a Housing Bill. At the same time, I think all my hon. Friends on these benches are as dissatisfied with the rating system as are hon. Members opposite, but the point of the Motion is to suggest that the question of street paving charges, which has its own law, its own regulations, and the question of the burden of rates should be added to a Bill which, when it comes before the House, will certainly terrify hon. Members opposite even if it is confined to housing. I submit that it is not reason-able, in a Bill designed to deal with the housing problem as such, that we should be asked to deal with a large number of problems which fringe the housing problem.
Most of us on this side, I think, agree with the substance of the case made by the hon. Member for Blackley and the hon. Member for Withington (Mr. Simon), as regards the incidence of rating and street paving charges, but I would ask the House not to commit itself to this Motion, and I do so be-
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cause it is utterly impossible, in the Bill which will shortly be before the House, to deal with questions which, however important, are really irrelevant to the main issue. We have had an interesting Debate, a Debate which has he-en illuminated by more than one maiden speech—and ail Members are glad to hear such speeches—a Debate which has roamed far and wide, but a Debate which, I believe, shows that in all quarters of the House there is still a genuine interest in this great problem of housing.
I would ask the House to bear with patience such little delay as there might be, to await the Bill which will come before it, to judge that Bill on its merits, to await what may grow out of our present inquiries into street paving charges, and to await a fuller consideration, because of the many implications involved, of the rating system as a whole. I would suggest that this Debate has allowed the right hon. Member for West Woolwich to let off a little steam and has permitted other Members to make speeches—it has had that good effect—and we might perhaps, without dividing on this Motion, agree, whatever may be said about the rating system and street paving charges, that they are problems that cannot be confused with the problem of housing. I hope the same enthusiasm for housing which has been evinced on the benches opposite will be manifested in the House shortly when the new Bill comes before it.
Major NATHAN: The right hon. Gentleman the Minister of Health, in his interesting speech, has spent most of his time in discussing a Bill which is not before the House, and in explaining and excusing, in anticipation, omissions from that Bill. The question which the House is now debating is not the Bill, the details of which, and even the date of the introduction of which, we have endeavoured to ascertain by questions across the Floor from the right hon. Gentleman, but have signally failed; the question is the broad question of policy indicated by the Motion brought forward by my hon. Friends the Members for Blackley (Mr. Oliver) and Withington (Mr. Simon), and I should like to bring the Debate back to its real subject-matter. The right hon. Gentleman knows the contents of his prospective Bill, but we do not, and I, for one shall not be

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horrified by his anticipatory description of his Bill as terrifying. My only fear is that the Bill produced from those benches will not go far enough or deep enough into the problem with which it has to deal.
The root problem towards which my hon. Friends' Motion is directed is the excessive burden of rates, which prevents the rents of houses being brought down to a figure which the ordinary working man or artisan can afford to pay. I do not know if it is realised that, taking the latest figure that I have readily available, the burden of rates spread over the population is no less than £4 2s. per head. Think what £4 2s. per head is, when translated into a burden resting upon a working class family. The rates alone, irrespective of rent, often absorb 10, 15, or even 20 per cent. of the week's earnings of a working class man. There are, in my constituency, hundreds of dwellings where that is the burden that falls upon working class families, and the problem is how to adjust the expenditure in the manner that will inflict the least harm. I myself, like others in this House, believe that much advantage is to be gained by the taxation of site values, but I think perhaps its most enthusiastic adherents are apt to be sometimes a little optimistic as to the time within which and the scale upon which the benefits will accrue. I think the taxation of site values is just and should be adopted, but meanwhile, before it can become effective, there are many alterations to our rating system which can far more easily be carried into effect and which will have immediate results.
The right hon. Gentleman made one statement in particular which, I must confess, struck me with very considerable surprise, when he said that de-rating is a hidden subsidy. The time is not so far distant when Members of the Socialist party stood up in their places in this House to protest against the transfer from the Exchequer to the localities, by the late Chancellor of the Exchequer, of certain burdens which had theretofore been borne by the central Exchequer. They protested, and I think they rightly protested, but does the right hon. Gentleman suggest that those were hidden burdens? So far from being hidden burdens, they were burdens which
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were felt and almost seen and about which the right hon. Gentleman and his friends were justly vocal. If a transfer of burdens from the Exchequer to the rates is not a hidden burden, how can a transfer from the rates to the Exchequer be a hidden subsidy? Indeed, it is along the lines of a transfer from the rates to the Exchequer that, in my view, the solution in some degree lies. We need to reverse the policy of the late Government and to ease the burdens upon localities, with a view to centralising certain items of expenditure which readily lend themselves to centralisation. After all, there are many services the expenditure upon which is laid upon localities, but over which, as a matter of fact, the localities have no control whatsoever. They are mandatory obligations, and they are imposed by Act of Parliament.
I was told only a short time ago by the chairman of the finance committee of one of the county councils in the home counties that there was only 12½ per cent. of local expenditure over which the county councils had any jurisdiction at all; the remaining 87½ per cent. was imposed by Act of Parliament, and could not be modified in any way by the local authorities. Just consider what the services are which fall to be carried out by the local authorities. If I take certain headings in the Ministry of Health Report, I find that they are these: "Education," "Other Health Services," "Housing," and "Poor Relief." Those absorb upwards of 45 per cent. of the expenditure by local authorities. Then upon "Highways and Bridges" they spend about 20 per cent., and the remaining 35 per cent. is made up of what are purely local and administrative services, such as "Sewerage and refuse," "Police," "Fire Brigade," "Miscellaneous and General Administrative Expenses."
Surely the right line of attack is to divide the liability up in the manner in which it naturally opens itself to division, namely, between the central services, the social services, and the administrative services. The central services would naturally be transferred to the central exchequer. The social services, especially those where the locality is under a statutory obligation, which it cannot escape, as regards the whole or at least a great part of them,

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might well be transferred from the localities to the central exchequer, from the rates to the taxes; and I do not think that it is over sanguine to calculate that of the £150,000,000 and upwards which are expended by local authorities to-day out of rates, a third, and perhaps even more, might properly and reasonably be transferred to the Exchequer and thus pro tanto relieve the local burdens. That still leaves a large and important sum in the neighbourhood of £100,000,000, to be expended by the local authorities, and, at a rough calculation, probably that amount might be divided as to two-thirds on social services, and as to the remaining one-third on administrative services. Anyone who looks into the figures will find an adjustment of that nature is approximately right.
Administrative services might be based upon a rate levied on the rateable value of premises according to the present system. Social services, on the other hand, might be levied over a wider area, and there might reasonably be, not a local Income Tax, as the hon. Member suggested—for I agree with the Minister of Health that that is impracticable—but a system of graduation and differentiation which would place the burden where it could most easily be sustained. It is not beyond the limits of ingenuity to devise swiftly and practically a scheme which would answer the problem by shifting the burden to a large extent from the rates to the central exchequer, and I would suggest to the Minister that it is essential, in connection with any proposals for housing, that this problem should be taken into account. Without some solution along the lines which I have sketched—too briefly, but, at least, on practical lines—any scheme for housing will be doomed to failure before it starts. I would ask the Government to prosecute with vigour the inquiry which the Minister has indicated is at present being pursued, with a view to being able, either to incorporate adequate proposals for overcoming this problem in the Housing Bill, or to bring in another Bill designed to achieve that purpose, and to come into operation at the same time.
Miss LEE: I have listened with keen interest to the speech of the hon. Member for North-East Bethnal Green (Major Nathan), because in his remarks were re-
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flected some of the ideas which, I believe, will form a practical solution of the difficulty. Like all preceding speakers, he made no attempt to defend local rating as we have it now. I think that we are in general agreement that a system of rating which discourages, rather than encourages, better houses is indefensible. All modern tendencies are towards making an increasing number of burdens national instead of local. It is very true that when we try to make the Income Tax the basis for local rating, great difficulties arise, but if we get our taxation as much as possible on a national basis there will be no injustice done. I find that, my figure is also 35 per cent. for purely local rates. It would be a tremendous service to the poorest sections of the community if steps could be taken to make the rest of that percentage a national burden. I would remind the House that we on these benches stress that the maintenance of the able-bodied poor ought to be a national charge. I suggest to the Minister that we have there a sure and a practical and helpful step towards relieving this problem of rates, which we might take while we are investigating the difficulties of some alternative system of rating.
Still more interesting in this Debate has been the recognition that even a completely different rating system will not solve the housing problem, with which we are fundamentally concerned, and the recognition that our housing problem has ceased to be merely the need to build new houses, and that the very essence of it is that we should build new houses at rents and rates which the working people can afford. The right hon. Gentleman the Member for West Woolwich (Sir K. Wood) and other speakers from the Conservative benches preened themselves on the housing record of the Conservative Government. We all agree that many houses have been built, and that over 1,000,000 have been erected n post-War times, but all who are interested in studying this problem are almost unanimous that these houses have solved the problem for the middle-class and for the more prosperous section of the working-class, but that the problem of the poorest section of the working-class, the men and women struggling in difficult circumstances to bring up young and relatively large families, we have not even begun to solve.

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At one period, I thought that this Debate was going to develop into a Scottish Debate. That was no accident; it was simply a reflection of the fact that in Scotland we have this housing problem more acutely than in any other part of the British Isles. The right hon. Member for West Woolwich spoke about what had been done to provide houses. I wonder if he is aware that, after all his magnificent effort, he has left 52 per cent. of the population of Scotland in what we call "buts and bens," that is, one or two apartment houses, and that 11 per cent. are living in one-apartment houses? No wonder Scottish Members are here in considerable force! When we turn to England, we find that only 5 per cent. of the population is living in one or two apartment houses, and only 1 per cent. in single apartments. We have still to devise legislation which will bring good houses within the means of the poorest sections of the community, and I hope that we shall tackle our probblem, not along one line, but along every conceivable line, so as to deal with taxation of land values, with profiteering in building materials, and with excessive profits made by building contractors, and have direct labour wherever it is necessary.
Important though these factors are, the chief factor is the interest that must be paid on money for building purposes. Because that is the chief factor, we must come back to some form of subsidy. I heard the Minister of Health state in rather an aggrieved tone of voice that he admitted that subsidies were necessary, and that we should recognise that already the State is paying one-third of the cost of houses. I was interested in that statement, because in the "county in which my constituency lies, there is a desperate and most urgent need for houses. We have whole villages in which there is not even a sewerage system. We have our people living in conditions that would be a disgrace to mediaeval times, but in that county we are granted in some instances 75 per cent. subsidy from the State when we want to build new roads or bridges. It seems absurd that we should be given three-quarters of the cost for roads and bridges and such services, and only one-third of the cost for houses. The Lord Privy Seal wants to know how to employ his men, and I
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suggest that we in Scotland can give him endless schemes for providing work in the building of houses that are so urgently needed, but a necessary condition of that is that we should be given a greater subsidy than ever before in whatever form that subsidy may take.
I was interested in a remark made by the hon. Member for Withington (Mr. Simon), and I would like to be clear about one side of his suggestion. We must get a subsidy in one form or another. Many of us are chiefly concerned with the housing problem of the family with young children, and the hon. Member for Withington suggested that, in order to encourage such families to remove from the slums into a better environment, special conditions should be given to them. He wants some form of rent allowance; but what has always puzzled me is this: If we have two families with an income of £4 each and three children in each family, and find that one family has struggled into a new house, are you going to deny additional assistance to that family, and yet give it to the other family which has identical circumstances and which still finds itself in the slums? I believe that I should be more in agreement with him if he would extend his conception of subsidy so as to include all working-class families or families which financially require assistance in this way.
7.0 p.m.
I would ask the House not simply to take a dutiful interest in this problem of providing cheap houses, but to become excited about it, to recognise that it is one of the biggest tasks that we have to undertake. An hon. Member opposite referred to the houses which he had seen at The Hague. I saw houses in Vienna and in the Ruhr area of Germany, and I came back to Lanarkshire feeling ashamed of what the hon. Member for Dumbarton Burghs (Mr. Kirkwood) describes as "the land of the brave and the free." We find that abroad this problem has been tackled not simply from the point of view of building houses, but of giving houses to people at rentals which they can afford. It has been tackled so in Germany and Austria—the defeated countries; we find there magnificent houses, playing fields for the children, and every modern convenience, and then we come back to the glories of Great Britain, the country which won the War, and find that we are tied down

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by old-fashioned, obsolete, conventional ideas of finance. Those defeated countries, with resources much less than ours, have had the courage to do these things, and I appeal to the Minister of Health and to the Chancellor of the Exchequer that they should consider if necessary new financial methods to deal with this need for cheap houses, and consider the suggestions I have made, that if it is not unreasonable to give 75 per cent. of the cost for roads and bridges, some of which are not desperately needed, they should give at least that proportion or more for the building of houses that are so urgently needed. It is not only a housing problem, it is an educational problem, it is a health problem and what we would be spending on housing we would be saving in health services, in social services and probably in criminal services. At every stage in our life this problem of housing is absolutely fundamental. We on these benches are standing for family life and for all the best interests in our national life. I was glad to hear a Liberal Member say that he was afraid the Ministry of Health Bill would not go far enough instead of going too far. That is a good omen, and I hope an increasing number of Members of this House will demand more and more that we do not delay or make apologies or excuses for ourselves in dealing with this problem, but that we get down to the concrete facts. I have seen children studying for their examinations at school in rooms where there have been wet clothes round the fire, in rooms where there have been younger children playing on the floor, in rooms where there have been older people talking and arguing. Can we say that we are giving them a fair educational opportunity when they are studying under such conditions? In the later stages of life you will find that the young men and women want to have a pride in their homes and want to bring their friends there, but they have to go in the streets and to learn things they otherwise would not, because conditions at home prevent them from entertaining their friends there.
For health, for cultural standards and for all those things that raise the standard of national life, this problem is so fundamental that I hope the Debate to-day is only the beginning
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of extended interest which will be reflected in the Second Reading of the Housing Bill and that the Labour Government, whatever else it may do or omit to do, will at least have the credit of showing that, while the Conservatives built houses for those to whom the rental was a secondary item, we started and went very far on the way to building good, pleasant homes for the working people of this country, especially for the parents struggling with young children, and that we raised in that way to a higher state than they ever enjoyed before the general standards under which our people live.
Mr. MacLAREN: I have listened all the afternoon to this Debate, and I am sure that there are many in this House who will be able to appreciate my feelings as to what has been going on all the afternoon, because I have heard King Charles's head mentioned so often by other people that I was almost becoming jealous of them. The Motion on the Paper seems to me an intimidating factor in the Debate. The major point of the Motion is to call attention to the heavy burden of rates on houses. We can all become extremely eloquent if we like to play on the awful conditions of housing in various parts of the country and to harrow each other's feelings with accounts of what we know and have seen, but in this Motion we have to deal with the burden of rates on houses. I have one objection to make to my right hon. Friend's speech when he spoke about the Bill. It is quite true that it is not the function and that it is not part and parcel of the Housing Bill to incorporate Clauses dealing with rating, but I would like him to remember that, at the same time as you are dealing with the housing problem, you must keep in mind the rating problem. You cannot keep one in a water-tight compartment, and hope to solve it by ignoring the other. That is the major blunder of every Government which has tried to deal with the problems of housing, as if it had nothing at all to do with rating. Their hope to solve it has been made practically impossible. Housing development and the rating problem must go together.
I want to refer to one or two things which I observed this afternoon about the Liberal party opposite. As an old

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Member of that group of Radicals, it was psychologically interesting to me. When I heard the Seconder speak, my mind went back to Alexander Ure, the late Lord Advocate for Scotland, and I wondered what he would have said if he had heard the hon. Member for Withington (Mr. Simon). No amount of sentiment will ever solve this problem, and no amount of tinkering about with charity rates here and charity rates there. When anyone is going to take into account the poverty of a man's pocket as to what he should pay for rent and rates, he is clearly getting away from a scientific adjustment of the whole problem. The Mover said that his solution for the housing burden of rates and houses was the rating of land values and he spoke about the local Income Tax. The hon. Member for Withington left land values out. Is he afraid of them? The third Member of the party opposite, while giving a sort of passive benediction to the rating of land values, seemed to be so far out of date as to consider it impracticable. He then suggested the old Tory remedy of removing rates from the local authorities and adding them on to the taxation of the country in the hope that you are doing something. It is no remedy of an economic problem to pass the rate from the ratepayer on to the taxpayer, because the working classes will have to bear it all the same.
Boil this whole matter down. Shred it of all the ornamentation we have heard in the Debate this afternoon, and what is the task before us? We in this country are suffering to-day from antiquated laws. "1601" should be in large figures above the gallery here so that we can all see it. This country in 1930 is trying to operate a rating system based on a rating law established in 1601 in this country. What is that rating law? I have said it before, and I hope the House will forgive me if I repeat it. It has been referred to by hon. Members opposite this afternoon. The assessors under the rating law are instructed to levy a rate upon the property at the price it will let from year to year in its present condition, with the result that if it is a good house, a house new to that local authority with modern equipment, it will let for more than a poorer house, and, naturally, the rates under the existing law must be
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higher. No amount of sentimental appeal to the Government that if a man spends most of his time in producing infants, he is to have no rates, or the sentimental suggestion to put people with families in houses, while people with no families who may be equally hard up must pay for the others, will affect the position. No amount of that sentimentality is any good. You have to change your rating. Put the rates on the property according to what it will sell for from year to year, the property in that case being the land alone and not the building. Take the rates off the building entirely.
While I was watching the right hon. Member for West Woolwich (Sir K. Wood) this afternoon I was wondering how ho was going to deal with the proposition of changing the rating system to land values. He is extremely careful not to touch it, and I thought this afternoon that the right hon. Gentleman would be shrewd enough to keep clear of it. But before he resumed his seat he was gallant enough to come forward and draw the dagger upon the proposal of my hon. Friend. He made a quotation from New York. I should like to verify that quotation. If he had understood the thing criticised he would have known even from the quotation, even if it is possible under the rating and valuation system of New York, for the landowner to pass the tax on to the tenant, that the land valuation in the first instance must have been a wrong valuation or that between this year's and last year's valuation the land value has risen so that the tax can be absorbed by passing it on to the tenant. I shall not go into that now, because it is a technical matter. The joviality which showed itself on the right hon. Gentleman's face when he let that slip seemed to show that he was convinced in his heart that once for all he had destroyed that proposition.
I would like to correlate another point. In dealing with housing you have got to keep in mind any handicaps of taxes and rates which tend to make rent higher than it ought to be. There is also another question, that of wages. We have heard complacent speeches this afternoon that houses should be built for the working-class man—as they are pleased to term him—and references to his having a non-parlour house and his living near his work. Those are phrases of the age of

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Queen Victoria. The working men in this country are beginning to appreciate the fact that the house is their tabernacle, that it is the main centre of their communal life, and there is no reason why they should be robbed of a parlour or the other appurtenances of a modern house any more than the man with a higher income. My point is this, and it brings me to my proposal this afternoon about local Income Tax. It should be the canon of rating law, as it should be the canon of taxation, that taxation should be not merely predatory, it should not be merely a question of rating or taxing a person who can well afford to pay, as the saying is. That is a fallacious idea. Taxation and rating should follow the principle that the basis on which you levy your rate and tax should be such a basis as would not in any way endanger the production of wealth or the production of houses, and would at the same time have an economic effect in society at large. The local Income Tax proposal would not have any economic effect any more than the national Income Tax now has. You have increased the national Income Tax greatly beyond what was ever dreamed of in its earlier days, but you have not affected the economic relationships between man and man in society.
The same thing would happen if you imposed a local Income Tax. The Minister of Health rightly pointed out the difficulties that would arise if you attempted to pursue the policy of a local Income Tax, because you have always got the old difficulty. A man is quite entitled to ask, "If you are going to put a local Income Tax upon me, are you going to put it on the place where I am employed, where I make my money, or where I live?" You would have half a dozen local authorities quarrelling as to which of them should absorb the local Income Tax. No, it will not do. You try to get round corners, and yet allow antiquated laws to remain in force. The burden of rates upon houses to-day is making housing an impossibility. One Commission after another has been set up to inquire into the question; the party opposite were responsible for the most important inquiries ever held in this country. They said, and quite rightly, that if the present antiquated rating system were maintained there would come
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a time when housing would become an impossibility, and that is the position in which we find ourselves to-day.
The better we build houses, the higher become the rates upon them; as soon as we improve old houses, new assessments are made; and then we ask ourselves why we have a housing problem! Go on taxing and rating men for building houses and you will assuredly be faced with a housing problem ! The introduction of de-rating showed that the Conservative party were recognising that the burden of rates upon industry was tending to stop industry. Eloquent speeches were made by the late Chancellor of the Exchequer to show how the rates levied on industry were merged into prices and how these increased prices were hindering our competition in foreign markets. In order to save the industry of the country, the Conservatives came forward with a de-rating Bill, but the farce of it all was that the sums they de-rated from the rates were passed on to the taxes, and so we are just as we were. So it would be if we adopted the local Income Tax. This country is more heavily rated per capita than any country in the world, despite even the de-racing Act.
Another interesting feature, of this Debate has been the reminder that the sum of £1,000,000,000 has been spent on housing subsidies. I do not know what influence I may have with the Minister of Health, but I implore aim to turn away from this vicious idea of subsidies. Subsidies do not solve the problem. If I were a landowner and knew that the Government were committed to paying subsidies for years to come, I should rub my hands with pleasure, because I should know that I had a first charge on them. If I were interested in promoting the production of bricks and mortar and other building materials, and knew there were subsidies, again I should rub my hands; because we know from experience that these subsidies inflate the price of materials and encourage landowners to hold land out of use until they can get a pretty fair price for it. Subsidies do not solve the problem and never will, and I have but little patience when I hear this see-saw argument between the two sides of the House as to which gave the more in subsidies. Let us make the penalty fall upon the man who withholds land from use, let us make it economic-

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ally impossible for land to be withheld from use, and encourage local authorities to put every ounce of energy they can into the production of houses. I only wish the late Government had recognised that the production of houses is perhaps the greatest producing industry in this country and had derated that as much as they derated agricultural land. But this is all by the way, Mr. Speaker. You will be saying to yourself that the Member for Burslem is having a night out; and many hon. Members will be saying that the satisfaction which I seem to get out of this comes to me but very seldom.
I join with the speaker who preceded me in saying that the housing question is perhaps the most important we have. If I believed subsidies would solve it, there would be no more enthusiastic supporter of subsidies. If I believed that some paternal form of adjustment and graduation of rates would solve the problem, I would support that also. Because I know from actual experience, and by studying the relationship of rating and taxation to production, that this vicious system of rating has brought us to the pass in which we are; because of the encouragement of the withholding of land from use, which creates unemployment, and keeps wages low whereby men cannot even pay for the houses we are building to-day; because of these things I am driven to a stronger belief in the faith with which I am identified in this House. Unrate the houses of this country, levy your rates upon the value of the land. I have got one hope, and that is that the Chancellor of the Exchequer will be the man who will fulfil the promises he made before he got into the position which he now occupies; and I think that will be the turning point of all the housing and other economic difficulties in this country.
Mr. GOULD: It is not my purpose to follow the most interesting speech of the hon. Member for Burslem (Mr. MacLaren), though I would like to deal briefly with his argument that if we transfer burdens from the rates to the national exchequer we drift the burdens back on to the working classes. If the logic of that were carried far, it would
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nullify the basis on which we have instituted the great national services which come to the aid of the sick, the unemployed and those who are in receipt of old age pensions. I regret that the terms of the Motion have been too narrowly drawn. To my mind we are not facing up to the real problem in dealing simply with the burden of rates on new houses. However much we may regard this discussion as academic, the problem of rating will be forced more and more on the attention of this House and a solution of it will be demanded by the mass of the people. There have been three stages in this growth of opinion. The Rating and Valuation Act, 1925, and the quinquennial valuation of property have brought valuation into the arena of discussion among the working classes. There are anomalies in assessment values. I know of new council houses where we have an annual value of £12 fixed for a house with three bedrooms and bathroom, and the annual value of a similar house in the same assessment area is around £26. In the same area you have a worker paying rates on an assessment of £16 or £18 net, and the same class of toiler, with the same income, and deriving the same benefit from the public services, rated on the basis of £8 or £10 for the same type of house.
In 1928, the Local Government Act brought the mass of the people up against the problem of the burden of rates. They felt that if it was a good thing to de-rate industrial properties and agricultural land there was a case for dealing with the burden of rates on the dwellings of the people. This Motion is, therefore, very opportune, because it does give the House an opportunity of facing up to the very real problem of housing those people whom it is most difficult to house on account of their economic circumstances. One point on which there is general agreement is that we should consider the classification of burdens in order to see how far we can make national services a national charge and put local burdens on to local shoulders. I have here figures which give a picture of the problem as it is in my own union. In 1909 road charges amounted to £2,847 and in 1927 they had risen to £32,925.

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This road problem is creating heavy local burdens. The roads are becoming more national in their use, and we have had contributions from the Road Fund, in spite of the regrettable inroads made upon it by the late Chancellor of the Exchequer; and the House must take the view that in the main the cost of these roads ought to be lifted from local rating. That we should go to a woman with a family of children and say to her, "Because you want a house with three bed-rooms you must pay a bigger share of the cost of this national service of road maintenance," is an anomaly which no one can defend. Take the cost of asylums. There you have almost the whole cost of mental cases thrown on the local rates, with the exception of an antiquated State contribution—dating back hundreds of years. The same sort of thing is seen in connection with education, although there some progress has been made in making education a national charge.
It is an essential thing that the public services of the country shall be apportioned on the basis of national charge-ability and local changeability—the latter where the services can be regarded as purely local. I have no desire to prevent hon. Members opposite getting a Division on this Motion, although I feel that it is too limited to be of much value, because it does not deal with the problem as it exists to-day, and I regard the new Bill referred to by the Minister this afternoon as one which would bring us closely against the problem of housing. The problem in the rural districts has not been solved by any Measure promoted so far. Further, I hope the incidence of rating and the anomalies in the assessment values of existing properties arising from the Rating and Valuation Act will be inquired into by the Ministry and that we shall get equity.
Question put, and agreed to.
Resolved,
"That this House views with regret the excessive burdens placed upon the occupiers of new houses by the incidence of the present rating system and by street-paving charges, and the detrimental effect of such burdens upon future housing development, and urges the Government to consider proposals for the reduction of such burdens in connection with any future legislation dealing with the question of housing."

POSTAL, TELEGRAPHIC, AND TELEPHONE SERVICES.
Mr. RAMSBOTHAM: I beg to move,
"That, in the opinion of this House, the condition of the postal, telegraphic, and telephone services calls for action in regard to the present working of these services with a view to rendering more efficient, extended, and satisfactory facilities to the public; and accordingly it is desirable that a committee of inquiry, consisting principally of business men, be constituted without delay for the purpose of reporting upon the administration (including finance) of the postal, telegraph, and telephone services, and also as to whether it would be for the public advantage that all or any of these services should be transferred from the Post Office to an ad hoc public corporation and under what conditions."
This Motion raises a matter of very great public importance. It deals with a matter of vital importance not only to my own constituency, but also to every constituency in this country. I hope the question will not be dealt with on party lines. I am not going to suggest that the Post Office functions better or worse under one Administration than under another or better under one Postmaster-General than another, and I am hopeful that the advocates of nationalisation will not resist the Motion because it does not bolster up their pet theories. I desire on this Motion to criticise the Post Office, but my criticism will be a criticism of a system and not the personnel. I shall not criticise the Postmaster-General or any of his supporters, and perhaps I may be allowed to say that I do not expect the Postmaster-General to come here garbed in a white sheet of repentance, much less garbed in a coat of mail bags.
I want to deal with the accounts of the Post Office for the year ending 31st March, 1929. It so happened that on 30th January I tried to get the accounts for the current year. Ten months elapsed, and then the accounts of the Post Office were printed. I notice that the Order of the House of Commons for printing the accounts was issued on 19th November, and it was two months after that date before they got into the hands of Members of this House. The Post Office seems to be a tied house to the Stationery Office, and I just mention that fact to show some of the handicaps under which we suffer. Why should it take 10 months to get out these accounts? The American

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Telephone Company, which employs 100,000 more men than we employ and has double the capital invested, gets out its accounts within three months of the close of the financial year. There is a good deal of information which we should like to have in these accounts, and their publication ought to be expedited. Now we have the accounts, and they show a profit of over £9,000,000, I think that is a matter upon which we should congratulate the late Postmaster-General, and yet I do not sec any sign of public admiration offered to him on this account. There has been within the last six months a crescendo of indignation on the part of the public in regard to the various points connected with the postal services, and that has not been diminished in any way by the fact that large profits have been earned. That is only natural, because postal charges are another form of indirect taxation, and, therefore, it is small wonder if the public does not enthuse over them. The Postmaster-General, in a speech delivered a short time ago, said:
"The public enjoy criticising the Post Office, not because the Post Office is inefficient, but because it belongs to the public, and they have a right to criticise what is their own."
I commend that to every chairman of a public company who has to face criticism from the shareholders. The chairman of a company may tell the shareholders that the company is their own, and they have a right to criticise what is their own and enjoy doing it, and, if he allays the annoyance of the shareholders, I shall be somewhat surprised. I am not going into details, but I should like to mention an incident which occurred to myself. On the day on which I was elected as a Member of this House, I received, as other hon. Members received, telegraphic congratulations from some of my friends. One of them was from my Noble Friend the late Assistant Postmaster-General, and all the telegrams reached me safely except that sent by my Noble Friend. Incidentally, I may remark that this Motion will give the Postmaster-General an opportunity of replying to the damaging indictment which appeared in the Press under the signature of the Noble Lord the Member for Aldershot (Viscount Wolmer).
Another matter I wish to raise is in regard to registered letters. I believe I am right in saying that up to December,
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1917, there was an individual check kept on those letters. They were transferred from hand to hand, and in the Post Office advice from the office of origin to the office of destination each letter was individually specified. After Christmas, 1917, what was called the bulk system was instituted, and under this system the office of destination only knows the number of letters that it is going to get and not the office of origin of each. The effect is that if a letter is lost the Post Office know nothing about it until a member of the public complains. This is naturally done to save money, and the Post Office claim that they have saved £20,000 a year by it, but it is done at the expense of public convenience. It pays the Post Office to pay up compensation rather than institute what after all is the proper system. If I may say so, the motto of the Post Office in this respect appears to be "Pay up at Mount Pleasant." A learned judge has described this system as similar to the consignment of sacks of potatoes. It is not merely a question of money, but, after all, it is not fair to the public, because not only money may be lost but important communications may get into the wrong hands and may not be traced in time. Moreover, it is not fair to the staff.
With regard to mail bags, I have not the latest statistics, but I gather that during the last two or three days none have been missing. Prior to August, 1927, each individual mail bag was checked, and then this precious bulk system was reintroduced under which the office of destination merely knows the number of bags that it has to receive. If a bag goes astray and is lost, it may take hours before the office of destination knows anything about the loss until perhaps it is picked up in the street or returned in a perambulator.
With regard to the telegraphs, the accounts show a loss of £728,533. Since 1870, when the Post Office took over the telegraphs, £45,000,000 has been lost, and since 1914 there has been a loss of £20,000,000, which has been reduced" recently by small surpluses. I hope the Postmaster-General will tell us whether the loss this year is less than the loss last year. Comparative figures in the United States for telegraphs show very large profits. The charges are the same, but the operators of the United States get

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70 per cent. more pay than our operators, and they also get a bonus on profits which I do not think our operators get. The Postmaster-General is, of course, well aware of the contents of the Hardman Lever Report. I will quote only one paragraph from that report which shows that in the minds of those eminent business men who considered the subject one of the main defects of the Post Office was the fact that it was compelled to work under Civil Service standards and by Civil Service methods. On page 20, paragraph 46, of the Hardman Lever Report the Committee say:
"46. Dealing now with the question of revenue, a deficit would probably remain under the present tariff even under business management if the Inland Telegraph Service is considered by itself, and under Post Office management, hampered by Civil Service conditions with an established staff, the deficit must be substantial."
It is very disquieting to the public to read a recommendation like that made by responsible business men who have spent a considerable amount of time in investigating the subject. I should like to ask the Postmaster-General, if he replies, to let the House know which of the recommendations of the Hardman Lever Committee have been carried out. I know one that has not been carried out. The report recommended that a competent engineer with administrative experience should be appointed for the telegraph system, and, as far as I know, there has been no such appointment, and I understand that the reason is that they could not get a man to serve at the salary offered, because all that they can offer is the Civil Service standard. Before I pass from that report, there is one point which the Committee lays stress upon, and it is the high ratio of administrative and supervisory expenses. I should like to know if that has changed in any way.
I come now to the telephones, the story of which is a long and a sorry one. In 1912, the National Telephone Company paid in royalties to the State about £300,000 a year, and they made a very substantial profit. They were then taken over by the Post Office, with deplorable results to the national balance sheet, for, since then, the Post Office have succeeded in losing £2,000,000 on the telephones. In the case of the National Telephone Company, the ratio of working expenses,
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in the last year for which I have the figures, was about 63 per cent., while in the case of the Post Office it was about 75 per cent. Last year, I understand, the Post Office made a profit, on the telephone portion of their work, of about £500,000, but, if any hon. Member has the curiosity to compare this with the gigantic profits made in the United States under the Bell system, he will be astonished at the disparity. I have a table here showing the figures, but I will not weary the House with it. It is not merely a question of profits a; compared with population; the profits are 10, and in some cases 15 times the profits made by our telephone system. In the United States the system is far larger. The American Telephone and Telegraph Company has a capital three times as large as ours. The cost per telephone in the United States is about £44, as against £76 in this country. Impartial observers, when they compare the two system", and see what an appalling difference there is between our results and those of the United States, must feel great anxiety.
With regard to the question of costs, I am informed, on what I think is good authority, that our urban costs are about twice as high as those of Continental towns in Switzerland, Italy, Belgium and Sweden, and nearly, if not quite, twice as much as those in Denmark, Germany and Norway. Why should that be? As for our rural telephones, the condition of affairs cries to Heaven for redress. The farming community is positively starved of the telephone communication that it should have, and I would commend to the Minister of Agriculture the suggestion that he should try to persuade the Post Office to do something more in this matter for the agricultural interest. If you live a mile from the Exchange, the cost of the service is three times what it is in Denmark, twice what it is in Sweden, and four or five times what it is in Australia and Canada. What is the reason for that? One main reason is the high cost of installation. In this country, under the Post Office system, it costs £80 to put up a mile of poles, but we have figures to show that the landlord can do it for about £40. I have been reading another Report which deals with the question of telephones—the Report of the Evelyn Cecil Committee—and I was very much struck by a suggestion in that Report, which

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almost amounted to a recommendation, that in these rural areas, which are rather sparsely populated, the farmers should be allowed to make their own telephone connections, and cut their own poles in their own plantations. What is the alternative? It is that they cannot get telephonic communication at all, because the installation is far too expensive. The Post Office get a lot of their poles from Sweden. They are sent to Southampton to be creosoted, and are lorried all over the country at great expense. Why cannot the Post Office use English larch?
I do not want to weary the House by describing the statistical position in detail, but I cannot refrain from reminding them of the position which we occupy among telephone-using countries. Our place is the tenth on the list—a deplorable position for a country of the industrial magnitude and wealth of ours. In the United States there is one telephone to every six people, in Denmark one to every 10, in Sweden one to every 13, and in this country only one to every 25. It may be said that one might just as well say that in the United States there is one motor car to every five or six people, whereas in this country there is only one to every 20 or so, and yet that would not prove that English motor car manufacturers are inefficient. It is forgotten, however, that in the United States the taxation of motor cars is about five and a-half times less than it is here. Moreover, that comparison does not apply in the case of Denmark and Sweden. With regard to the case of cities with a population of over 100,000, what position does London—the so-called metropolis of the world—occupy with regard to telephones? It is 27th in the list of cities. That is almost scandalous. I think we are ahead of Tokio, Buenos Aires, Vienna, and perhaps one or two others, but every other city of any magnitude is better.
What are the conclusions that I would ask people who are not in any way biased in favour of one particular system, and who are willing to keep nationalisation out of their minds, to draw from these facts? In the first place, the Evelyn Cecil Committee, a body of competent people who examined the situation exhaustively, were convinced that the telegraph and telephone services should be separated from the Post Office itself, and carried on under a separate administra-
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tion— a public administration, if you like, but, anyhow, separately. A short time ago the London Chamber of Commerce sent a resolution to that effect to the Prime Minister, and I believe that business people generally all over the country are demanding that something of that sort should be done, in order to bring this country more on a plane with other civilised countries. I would suggest that that should be one of the subjects to be inquired into by the committee of business men which in my Motion I ask the House to appoint.
The second matter to which I would draw attention is this: It is very difficult for the Post Office to function under present conditions. That is not the fault of the Postmaster-General; it is not the fault of a single one of his staff; but under Civil Service conditions and methods it is almost impossible to run a great business, and I should like to see this point inquired into also, so that business people might consider how best what is essentially the biggest concern in this country can be run. The Postmaster-General—I say so without intending any discourtesy to him—is a bird of passage. If he were to remain Postmaster-General all his life, he would be absolutely disheartened. His real merit, and that of his very valuable assistant, is not thoroughly recognised. Neither of them is, if I may say so without disrespect, a business man in the common sense of the word. They do valuable service in the House of Commons and outside, but in some senses they would be described commercially as "guinea-pig directors."
The head of the Post Office, the Permanent Secretary, is a Civil Servant of very great distinction and experience, but he is a Civil Servant who has not had business experience. He has not had to make both ends meet, he has not had to fight competition, he has not had to worry as to how long he can keep the show going and find employment for his people. Even so, look at his position. He is a responsible for a concern, the exact capital of which I forget, but I think it is about £150,000,000, employing 230,000 persons, and he receives a salary of £3,000 a year. A man in a similar position outside would get £10,000, £15,000 or £20,000. I know that £500 a year is quite enough to live upon in the opinion of hon. Gentlemen opposite, particularly on the Treasury Bench.

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Again take the case of the Engineer-in-Chief. He places contracts and is responsible for work of the value of something like £10,000,000 per annum, and he receives £1,500 a year—rather less than a municipal or county engineer would get, and certainly not sufficient to tempt a younger man with the best brains into the business. In business the great necessity is for the best brains, and we still have, under our capitalistic organisation, to pay for the best brains, because they can earn it.
With regard to the staff, such researches as I have made show that there is precious little incentive for many of them to pull their weight and do their best. It is not their fault. I am told that a London sorter enters at the age of 18½ and it is 30 years before he can get his first promotion, which I imagine is his last. The average age of promotion in the case of London sorters is 52. What a hope! What chance is there of getting the best men in a business like that, when their position is such that, however hard they work, they have to wait 30 years for their first step? Then there is the question of outside control, and here again the unfortunate Post Office is hampered at every turn. For its building construction it has to go to the Office of Works. In fact, I read a statement the other day—I do not know whether it is right or not—to the effect that the Engineer-in-Chief could not buy an office table without going to the Office of Works for sanction. It has to go, as I have said before, to the Stationery Office for all its printing. It cannot, as I or any one of us could, put it up to tender. It is a tied house. The Stationery Office can charge it satisfactory prices, and get out its accounts any old how and at any old time. Finally, there is the Treasury. Treasury sanction has to be obtained for all its expenditure. Imagine the position of people in business if they had to go to some outside authority—not an expert in their business, because, valuable and clever as Treasury officials are, they can hardly be said to be experts in postal matters—for sanction to spend money. With checks such as these—the Office of Works, the Stationery Office and the Treasury—how is it possible to carry on such a business on commercial lines?
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I hope I have said enough to show the House that there is good cause for an inquiry. It need not be a party matter; we are all interested in the efficiency of the Post Office, and want to get a move on and get matters put right. It seems to me that Civil Service methods and standards, while they may be admirable in the case of the Inland Revenue, the Customs, and so on, are quite the reverse in the case of a business concern which is interested in making profits, even if those profits go to the Treasury. It is a little unfortunate for any business firm if it cannot retain the profits that it makes, and every penny that the Post Office makes goes to the Treasury. It does not go back into the business, and it does not go to the staff. I see, from the report of the Bell telephone system for the year 1928, that they have systems of benefit, investment encouragement systems for giving cheap stock to the employés, and so on, under which £9,000,000, or 8 per cent. of the pay-roll, went back to the employés. I do not say that we could approach such figures in this country, but we could do a great deal more for the staff if all the profits of the Post Office were not "milked" by the Treasury. I appeal to the House to treat this question in a non-party way, in the hope that we may get a committee of inquiry with business men in charge—because it is a commercial business concern—and that they may discover some way, perhaps by reference to an ad hoc corporation as suggested in the Motion, but anyhow some method which will release the Post Office from the shackles of Civil Service standards, and enable it to function more efficiently and with greater satisfaction, not merely to the public, but to the employés of the Post Office themselves.
Mr. MOND: I beg to second the Motion.
8.0 p.m.
I wish to make it clear at the outset that, like my hon. Friend, I do not propose to criticise the permanent officials of the Post Office whose arduous duty it is to carry on this great national service but I propose to criticise the system under which it is carried on, and I think the system lays itself open to very considerable criticism indeed from every point of view from which it can be examined. The head of the Post Office

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is the Postmaster-General. He is a Member of the Government, sometimes a Cabinet Minister. That in itself is the greatest criticism perhaps that could be passed on the Post Office and the system under which it is run. There have been in the last 30 years 16 Postmasters-General, and this great business has been perhaps the greatest single business organisation in the country. It is supposed to be carried on by a series of kaleidoscopic individuals who seldom really remain in office on the average as long as two years. I have had some experience in industrial matters. I have been all my life connected with those who have had very considerable experience, and I do not know one of them who would even pretend to begin to understand the rudiments of his job in taking over a great concern of that kind in a matter of two years. It is quite impossible. There is no human being, were he gifted with all the wisdom of Solomon and all the business knowledge and experience of Rockefeller, who could make a success of the job under those circumstances. I have not yet noticed that the office of Postmaster-General is as a rule offered to those individuals in Governments—I say this without any offence to the right hon. Gentleman opposite—who are at the height of their power and influence and prestige in the Government of the day. The head of this great system is neither selected for his administrative ability nor for his political sagacity but for other and various reasons which it is no part of this Motion to enter into.
What we have to consider, and what I propose to direct attention to, is the result on the Post Office of the system under which it works. The result has been a sort of helplessness, and, as an institution, it wanders about with a sort of vacuous hopelessness in the modern world of scientific invention and rapid development, dropping mailbags at the least pretext, longing for the return of the old mail coach and the old days so that it could have a really good hold-up instead of having to push mailbags out on to the pavement in order to get the necessary stimulus. In days gone by in the wild West of America, the sanctity and safety of the mail was the yardstick of civilisation, and, measured by that yardstick to-day, this country does not
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stand very high. I have attended within the last few weeks more than one discussion with serious men who, in dealing with the question of whether information or figures should be circulated by post, have said, "No, if you post a letter to-day you never know who it is going to reach or where it will eventually arrive."
But I have very considerable sympathy with the Postmaster-General. He may be a Postmaster, but he is not master in his own house. He is under a great many disabilities. He is under the dead hand of Treasury control. He cannot do any of those things that the head of a business can do which make him the successful head of a business. He is deprived of all those rights. [Interruption.] He cannot amalgamate, because he has a monopoly. That should be more or less obvious even to hon. Members opposite. He is not allowed to build his own buildings. The First Commissioner of Works does that. He is not allowed to have his own printing done. That is done by the Stationery Office. He is not allowed to fix the charges for his own services. He is not allowed to fix the price at which he will sell his goods. That is done by the Treasury, and many political considerations enter into it. They are not business but purely political considerations. He is not allowed to retain his surplus income. That is grasped by the Chancellor of the Exchequer, who takes it into his Budget for other purposes, so he has no opportunity of building up those reserves which are essential for any progressive or progressing business.
He is not allowed to embark upon any new type of expenditure without the approval of the Treasury, partly because of the instances which I have just quoted and partly because of the system, so that he is deprived of initiative in the real sense of the word, and his capital expenditure is definitely limited. If you deprive a man of all those powers, I cannot for the life of me see what good he can really do at the head of an institution which is run on a commercial basis. The money that may be spent on the development of telephones has been limited to £12,000,000 a year. That was not based on the real necessity for the expenditure on telephones. That was a Treasury decision, and I have not any doubt that the

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Postmaster-General had a considerable argument with the Treasury as to how much he might be allowed to spend, and that was the result of some kind of compromise and settlement with the Treasury, as these matters usually are.
Most serious of all, he has no real control over his own staff. The staff are civil servants. They are promoted according to Civil Service regulations. If ever there was a dead hand put on the building up of a first-class scheme to run an industrial organisation, the Civil Service method would be the biggest handicap that could be imposed. The Civil Service organisation is very good for the Civil Service, but the Post Office is not in the ordinary sense a Government Department. It is one of the greatest business enterprises in the country, and, in order to make it successful, a team has to be built up to run it. I should say, owing to the size and complexity and the difficulty of this business, it would require at least five years to build up a good team on a strictly competitive basis, with rapid promotion on nothing but a competitive basis, but the Postmaster-General is debarred from taking any such action. He cannot adopt a policy of that kind. It is not within his power, and, therefore, under all these disabilities, it is impossible for the postal services as a whole to achieve any of the success which I am certain could be achieved under any of the ordinary commercial methods practised by a great many different concerns.
The Postmaster-General has resented the criticism that has been put forward by the Noble Lord the Member for Aldershot (Viscount Wolmer). He has accused him of half truths and inaccuracies, and even of political rancour, in criticising this matter. The Noble Lord is quite right. Judged by the purpose of its being, the Post Office is one of the least efficient Departments in the State, unable to cope with the mail, and losing it with great frequency. It ought to give up the unequal task of trying to deal with the telephones, because there it fails even more completely. Very few figures suffice to prove to any business man how hopelessly inadequate the telephone system is. In the United States, there are 165 subscribers to every 1,000 inhabitants. In Canada, there are 138,
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in Sweden 79, in Germany 47, and in this country, the leading industrial country in the world, employing more people to every square mile than any other nation on the earth, that great industrial land Great Britain, there are 39. That does not seem to me to reflect much credit upon the Post Office. It does not seem to me to reflect much credit upon the ability of the people who are charged with its administration, but I would not reflect upon their ability. I should rather reflect on the system under which they have to work, because I am certain they would be much more successful if they were freed from that System.
One of the reasons why we stand so low in the number of telephones is the bare question of cost. The capital expenditure per instrument in this country is nearly twice as high as in Sweden. In Sweden the figure is £31.6, and in this country it is £77.31. The Swedish figure does not include land and buildings, so that our figure is not quite twice as much. In the United States, where costs are very much higher than in this country, they are still able to do their telephone capital expenditure per instrument a great deal lower than we are, the figures being £46.7 and £77.31. Subscription costs, as a result, are very much higher, but the capital expenditure does not account for the whole of the increase in the subscription cost. In England, they are about 150 per cent. higher than in Stockholm. Stockholm is a very small city compared with London and, obviously, there must be something desperately wrong. No one can defend the figure. There is something wrong with the system or the administration. Any business man faced with those figures would be most disturbed, and so the country ought to be. It is the privilege of the country to criticise the Post Office, and it ought to criticise it, and it does criticise it often. Trunk calls in England cost practically six times as much as in Sweden.
The return on capital affords another significant figure. In the five years to 1927 the average profit earned on the capital invested in Sweden was 6.4 per cent.—quite a decent return. In this country, with the great opportunities that are presented, the capital return is only 3.1 per cent. Sweden is a thinly-populated country with very severe climatic conditions and a geological structure

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which makes the laying of cables and the drawing of lines a very difficult matter. That adds all the more to the great case that is being built up, not only in this House to-night but outside, and which will continue to be built up against the whole system under which the Post Office functions. Similar comparisons could be made with other countries—Germany, Denmark, United States. It is clear that the earning capacity of the Post Office, the telephone system in particular, is enormous. It is only because it is under a type of administration which makes it impossible for it to run successfully that the whole of this earning capacity is thrown away and the public fails to get the benefits which it might get. In the last couple of days comments have appeared in the Press on this matter, and there have been two letters in the "Evening Standard" which have mentioned that, when you dial for an operator on the new automatic telephones, you fail to get any response, even if the house is on fire or if one of your family is dying.
Under this new system you are entirely cut off. You have not even the satisfaction of jigging the receiver to try and attract the attention of the operator. You simply get a blank lack of reply. On the automatic telephone, it seems to be more essential than ever that a system should be devised whereby really urgent calls should, at once and immediately, be replied to. You have the case of a lady in a burning hotel who dialled the operator, and who shouted "Fire —" and "Fire Brigade —" several times and received absolutely no reply. The following day you have a similar type of letter, a case of severe illness, which shows again that this automatic telephone has not been organised on such a basis that the ordinary citizen who pays for a telephone installation and expects to receive certain benefits from it, can depend upon getting those benefits. On the contrary, he can depend upon nothing of the kind. That is the reason why the present annual increase of subscribers is only about 120,000.
There is no doubt that under a properly organised system you could, without any difficulty, get up to a couple of hundred thousand new subscribers a year. All that would mean more employment. It would mean that navvies would
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be required to dig trenches, and workmen to erect lines and factories, to make plant, instruments, wires and cables. I can imagine, for instance, the Lord Privy Seal as chairman of a company administering the telephone service of this country, freed from the dead hand of Treasury control and running the matter on business lines, making a great success of it. There is one thing alone which shows the extraordinary inability to respond to modern conditions. It is, I think, a fact—although I am quite open to correction, and I hope that I shall be corrected if I am wrong—that the little wooden boxes which are fixed on people's walls and contain the electrical apparatus which rings the bell consist of imported timber and cost about 10s. each, whereas in the United States they do not consist of imported timber, but are stamped out of steel, which we can make in this country, and cost 1s. 6d. each. How can you possibly hope to be in the same range and in the same position in the telephone service with the rest of the world if you are as far behind as that? There is every opportunity of giving employment under an extended telephone service, and for that engineers are required.
I have one point of real praise for the telephone service. I have been associated with well-deserved and well-merited praise to the engineering staff of the Post Office telephone service, who have to my knowledge done most excellent and most admirable work on more than one occasion. Their work has been quick and beautifully done. It has been everything that anybody could possibly ask or expect. What does the Postmaster-General do? What does he do with these good servants, the one part of his Department of which he can really be proud? He sacks them. He has reduced them by 850 in 1929, and he is not getting any more. He is not encouraging that branch and finding more work for them to do. No, he is getting rid of them. I think that is most unfortunate. It is really lamentable. Here you have an opportunity to creat more employment, to do more work to provide the public with a service which it urgently and really needs, and what is the Government Department doing? It is getting rid of the engineers, highly-skilled, highly-trained men, who might be the nucleus

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of a very much larger organisation to provide this country with the type of telephone service that it really needs.
I do not like to refer to personal matters, but I must refer to one thing within my personal knowledge as it affects me. It relates to the question of oversea telephony, that great and remarkable development in modern science which has now become a commonplace and an ordinary matter of modern life. I am in New York, and I want to telephone to London. Nothing very surprising happens. They put you on. The operators are extraordinarily good and very, efficient, and so they are in this country. But the Post Office itself is lost in wonder and amazement that this thing should be. It is staggered. I put a call through from my house in the country to New York, and I received this very remarkable document. In the first place, it is addressed to "Sir Henry Mond." I was not aware that the Postmaster-General had the prerogative of conferring the honour of knighthood. But, while I am obliged to him for the compliment which he has paid to me in that direction, I should like to inform him that I prefer the privilege of sitting in this House of which he has deprived me. The letter says:
"The District Manager begs to forward herewith an account in respect of your recent Trans-Atlantic telephone call. In view of the exceptional nature of this service "—
After a matter of two years, what is there exceptional about getting hold of an American service and ringing up America? It is the most ordinary thing in the world. Why is there anything exceptional about it?
"I shall be obliged if you will favour me with an immediate settlement."
The Post Office are well-informed and know the advantage of pressing for immediate settlement on matters of ordinary routine. Perhaps my credit does not stand sufficiently high with them. If that is the case, I withdraw any complaint against the Post Office, but, if they are satisfied that I am good for the sum of £9 or £10, then I think that they are not encouraging the use of the telephone by dunning their customers very rapidly, almost immediately, with bills for what ought to be a perfectly normal
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and ordinary thing. There is nothing marvellous or strange about it now. Scientifically, it is a miracle, but, as far as the Post Office are concerned, you can take up an instrument anywhere in England or America and ask for the other side of the Atlantic, and make perfectly certain that you will get it and get a good line too. Very often it is quicker to telephone to America than to telephone from London to Hammersmith. There have been a lot of complaints in the past about the decrepitude of British industry and the antiquity of some of the directors who sit upon those Boards. Here you have the case of a national monopoly which is becoming decrepit, without getting old. Antiquity it cannot claim, but decrepitude it has in plenty.
One has only to turn to the telegraphic service to realise the big deficit which has been accumulating. My hon. Friend who proposed this Motion referred to it. Business men of distinction have been called in to report upon this position. I may say that some of them are old colleagues of mine. They have reported and reported with no uncertain voice. In fact, I have here somewhere an extract of what they said:
"The Committee are not satisfied that the present service gives the speed which is essential. The fact that the telegraphic service has come to be regarded as a diminishing business has introduced an atmosphere of inertia, and the resiliency which should be found in a progressive business is lacking. The Committee are of opinion that the present deficit can be attributed to a considerable extent to the foregoing causes, coupled with the factors of Civil Service conditions, together with redundancy of staff, rotation of duties and grading of work."
That is only one short quotation taken from the Report, but it is fair to say that it expresses the general feeling and opinion that runs throughout the Report. In view of the complaint in the Report, and its importance, and the importance of those who were called on by the Government to give their services on this national service, I made so bold as to ask the Postmaster-General whether he would state what effect had been given to the Hardman Lever Committee's Report. That question was put down last Thursday, for a reply on Monday, but up to the present time I have not received a reply. I thought he would have been able to let me have an answer before this Debate, and that he would not have

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avoided replying to me. He must have been aware that I was going to second the Motion.
So far as the postal service is concerned, the advantages of the penny post have been often advocated, and I will not deal with that question now, but I do think that the penny post would be of great advantage to the postal service, if the service were put upon a business basis. It would not be of any advantage under the present conditions. It would certainly not be of any advantage to the Post Office under the present administration, although it would be of advantage to the business community. The real question is the type of control under which the Post Office ought to be. An Amendment to the Motion makes reference to the Post Office as a national institution, subject to the control of Parliament. Of course, it is a national institution, and it will always be and is bound to be. As to its being subject to the control of Parliament, of course, it will always be subject to Parliamentary control. But what kind of control? That is the point. I do not mind its being subject to the control of Parliament as are utility companies, railway companies, or gas companies, but it need not be subject to the control of the Treasury.
What really needs to be done with this service is to treat it for what it is—one of the greatest business undertakings in this country, to bring its management into line with that of the management of every modern commercial undertaking, to get rid of the political influence which is bound to creep in if it is directly under the charge of a responsible Cabinet Minister, to get rid of Treasury control, and to put at the head of the Post Office a business man with a free hand, with the knowledge that he will be undisturbed, whatever political changes take place, whatever the situation in Parliament may be, and that he will be in charge of the concern for a sufficiently long period to plan great reforms, and to see them through to the end in such a way as any effective head of any business concern in the country would do.
Mr. BOWEN: I beg to move, in line 1, to leave out from the word "That," to the end of the Question, and to add instead thereof the words:
"whilst this House will welcome any improvements in the postal, telegraphic, and
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telephone services, it declare" that the continuation of the present high standard of these services is dependent upon the maintenance of the Post Office as a national institution subject to the control of Parliament."
I think many hon. Members will agree with me when I say that, if the case against the Post Office rested upon that which has been put up by the Proposer and Seconder of the Motion, there is very little that one can criticise, because there is nothing to reply to. [Laughter.] The hon. Member may laugh, but I have not quite finished. One would imagine from the speech of the Seconder of the Resolution that all was well in the business world, that nothing ever went wrong in the business world, that nobody ever had any losses, and that no one could put their finger on any little thing and find fault with it. The Mover and the Seconder have been very careful readers of recent articles in the "Times" and the "Morning Post," which have been written by the Noble Lord, who was the late Assistant Postmaster-General. They do not seem to have assimilated all that was contained in those articles. I will lend them the articles if they would like to refresh their memories. The Seconder of the Motion, in roving about the world to find fault with the telephone system, went to Sweden, but he did not appear to have read the articles sufficiently clearly to have found out that in Sweden the telephones are State-owned. If there is something wrong with the telephones in this country, they can be put right equally well under State management without bothering outside business enterprise.
I have yet to learn that in regard to this national undertaking, one of the greatest business undertakings of this country, the best thing we can do is to let it be run by those business men who have been so successful in all their endeavours. The Mover of the Resolution outlined a proposal for a director with a salary of £10,000, £15,000 or even £20,000. A magnificent opportunity for those people who are looking for jobs in the Post Office —
The Mover of the Resolution reviewed the position of the staff in regard to promotion, and the terrible position in which they find themselves; and to that extent I agree with him, but what guarantee is there that the proposed new form of control would improve them, or

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that the better conditions in outside industry would be applied to them? One would imagine that in all these big national institutions everything is going like clockwork, that everybody has a post at the top and need not worry about anything else. Some reference has been made to mail bag robberies. I think that cheap jokes on that subject do not come well from either the Proposer or the Seconder.
Mr. WOMERSLEY: It is not a joke for the public.
Mr. BOWEN: I know that. Nobody in the Post Office desires for a single instant that these things should happen, or that they should not be prevented, if possible. What did I see in the "Evening News" to-night? I saw there an article saying that burglars have been very busy in some districts and also in the City during last year. It refers to the great increase in the "smash-and-grab" crimes and the consequent loss to the insurance companies, and the damaging of women's dresses and fur coats. I want to suggest that it is cheap gibing at the Post Office to refer to these lamentable happenings. They are occurring in other parts of the country. There is a lot of thieving going on, and, if there is any reflection on the Post Office, there is also a reflection on every institution in the country which cannot prevent it; and probably they include some of the institutions to which the hon. Member for East Toxteth (Mr. Mond) belongs.
The Mover and Seconder of this Motion have tried to imbibe the wine which the Noble Lord the late Assistant Postmaster-General has been giving them in the newspapers, and perhaps it would be better if I came to the arch villain himself. The Noble Lord has made a complete study of what he conceives to be the weaknesses of the Post Office. If there are weaknesses, it is not for hon. Members on this side to defend them. For 40 years I have been pointing out the weaknesses in the Post Office, but the mentality of hon. Members opposite has prevented those weaknesses being cured. They have been in charge of the Post Office for the last half century. Their opportunities existed long before there was a Labour Postmaster-General. The hon. Member who moved talked about unemployment and the possibility of finding jobs in the
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Post Office. I remember when we pleaded with hon. Members opposite for more employment in the Post Office and the prevention of discharges from the Service, we were told that the Post Office had to exercise the strictest possible economy in every possible direction. When the Committee under Sir Eric Geddes was set up, he was told to walk into the Civil Service and find out where he could wield his axe, but in the Post Office he found that he had been forestalled; the administrative chiefs had done the work for him. It is not necessary to get you big business mind into this job. The Post Office has been running for 70 years without the assistance of your big business mind and has done very successful work indeed. The Noble Lord has said:
"In whatever direction we look, we find there is well-founded public dissatisfaction with the services of the Post Office."
It just depends where you look. There is hardly a national institution which is the subject of so much captious criticism as the Post Office. What can be more captious than the criticism of the hon. Member for East Toxteth when he talks about the puny little boxes which should be made of steel instead of wood?
Mr. MOND: This matter will amount to some millions of pounds a year, and I have some considerable knowledge of it, because it was put before me. It is not a puny matter, but a most important matter.
Mr. BOWEN: As a business proposition, the hon. Member will agree that neither the Post Office nor any institution would be justified in buying steel, if wood would do, on account of the expense.
Mr. MOND: Steel is very much cheaper.
Mr. BOWEN: These small pettifogging objections do not do justice to the hon. Member. When he went on to speak of other things he disclosed an entire ignorance as to how the Post Office is conducted. When you look round the Post Office, you do not observe its efficiency for the simple reason that you do not look for it. But it is there, a silent efficiency, so efficient that the public do not realise that they have a Post Office until they find some trivial thing going wrong. The hon. Member spoke about a telegram which the late

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Assistant Postmaster-General is supposed to have sent him. The possibilities are that the Noble Lord did not send it. I do not know the facts, but the story is on record that the Noble Lord did try to send a telephone message but failed because he did not understand the instrument.
When we talk about a service of this description, we are entitled to look more deeply into the matter than has been the case in the speeches of the Mover and Seconder of this Motion. The Noble Lord also said that he thought it was not too much to say that the public would get an infinitely better service if they kept the politicians and civil servants out of the Post Office and had it administered by professional business men. He stayed for four years in the Post Office, and still lives to tell the tale. I am rather encouraged to ask whether his attitude towards the Post Office was in complete agreement with that of his chief. If the efficiency of the Post Office is in question, I must point out that any possible loss of millions, as has been stated, to the taxpayer can be set off by the fact that during the last 17 years ending on the 31st March, 1929, the surplus, after charging interest on capital on the whole of the Post Office services, has amounted to over £74,000,000. Last year, the surplus was £9,500,000; a very attractive proposition to the business mind.
Mr. MOND: On what capital?
Mr. BOWEN: If there is a loss on telegraphs, it is said to be due to inefficiency. If there is a profit on the other side, it is said to be due to the fact that the Treasury insists on there being a profit. The Treasury can equally insist on there being a profit on the telegraphs if they desire.
Mr. MOND: You cannot get it.
Mr. BOWEN: You could get it by the decision of this House. This House controls the Treasury policy in this respect; and what is the good of saying that the dead hand of the Treasury will not allow the Postmaster-General to rule. The fact that the Treasury is there is due to hon. Members opposite, who have imposed the system on the country. For good or ill there it is. We are told that no institution in the country stands in
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greater need of rationalisation than the Post Office. That is the statement of the Noble Lord—that no institution stands in greater need of rationalisation than the Post Office. We knew what rationalisation was in the Post Office before the word was coined for use in industry outside. We always knew it; we knew it by the phrase "adjustment of staff to traffic." Redundancies that are talked about in the Hardman Lever Report are nothing in comparison with the great service that 230,000 people have to give.
One aspect of rationalisation we must take into account, because it is a, fact that in the Civil Service, in the matter of the employment of labour-saving machines for example, the Post Office is in the van of progress in this country. In the Post Office Savings Bank there is a complete up-to-date machine system which saves something like £100,000 a year under a recent scheme of rationalisation. I am sure that that would warm the heart of the Seconder of the Motion. It is just the type of thing that the business man would do—to introduce machines, and let the human factor in industry not be very much considered. In its motor service, we find expansion in the Post Office to the extent that at the present time there are 2,000 postal motor vehicles. The engineering department has 1,500, the Post Office being the largest motor transport owners in the country. Incidentally, in the process of introducing these machines the Post Office has dispensed with 1,700 full-time posts since 1924 and has created 800 part-time jobs. If hon. Members opposite want to do a good job, let them assist those of us who are looking after the staff interests. You do not want a business man to do that.
Mr. MOND: Ask your trade union leaders.
Mr. BOWEN: Our trade union friends on this side are quite competent to show the Post Office where weaknesses lie, as we have pointed them out over and over again to Conservative Postmasters-General. This policy was introduced by a Conservative Postmaster-General— [Interruption.] Hon. Members opposite cannot blame me if I feel a little bit warm about the sacking of these men, the kind of thing suggested by the Hard-man Lever Report—" Clear these people

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out of the service. Let us have machinery, which is speedier, and all the rest of it." Hon. Members opposite may be satisfied that that is good for the business of their side, but it is not good business if it is mixed up with finding more employment in the Post Office.
I think that the present agitation against the Post Office is very largely political. The Post Office is oftentimes quoted on one side of the House as a possible example of what nationalisation could be like. On the other side, it is condemned for its inadequacy as a nationalised service. You must have a nationalised service with a real Socialistic spirit behind it before you can get a socialised servie. We have had to put up with a service with a bureaucratic, Conservative spirit, which has dragged at its heels for a century. That is what we are putting up with to-day. Hon. Members oposite smile, but they smile too soon. Let me suggest that, in spite of all these handicaps, the Post Office has succeeded as a nationalised institution.
Mr. MOND: And a strict monopoly.
Mr. BOWEN: Let it be a strict monopoly. It is a national business under national ownership. Let hon. Gentlemen opposite point out where there is real wastage of money in the Post Office and where money can be saved. The noble Lord the Member for Aldershot (Viscount Wolmer) has tried to do so, and time will not permit me to answer all his points. He has said that the Post Office has invariably been unsuccessful where it has tried to compete with private enterprise, for instance in the case of the parcels post, life insurance, and cables. With regard to life insurance, the Post Office was never allowed to compete; its business was not allowed to develop, for the simple reason that when it was pointed out by the large private monopolies, the big insurance companies, that the Post Office was competing, those responsible for the policy of the Post Office stopped the push in regard to life insurance. When the Post Office developed the beam wireless service and made a wonderful success of it, when it competed successfully with the cable companies and secured a lowering of the rate throughout the world,
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what happened? The business mind came in and took off a most profitable block of the service. It cannot be said that the service was not successful. It was killing the cable companies' competion, and that was the beginning of the end so far as the Post Office was concerned, because those influences which have connection with the cable companies, the Marconi and other companies, brought themselves together and exercised an influence on the Government of that day to the extent of pinching from the Post Office an instrument which had been so profitable.
Now the same policy is showing itself. The same agitation is being worked up because the Post Office is steadily making a success of wireless telephony. We have the same influences complaining, and exercising themselves to such an extent that they are attacking the Post Office, as we gather from the "The Times," in the hope that they can add this service also to their Imperial Communications Company, Limited, service for private purpose. The Post Office surplus last year was nearly £150,000.
Reference has been made to the telephones and the difficulty about rural areas. The question must arise whether in rural areas any business company would introduce a service which would not pay. Let me put it to those who have spoken from the benches opposite—would either of them introduce a business in rural areas, knowing full well that it could not pay?
Mr. MOND: Yes, with a monopoly.
Mr. BOWEN: Then why do you want to change the monopoly If you are satisfied with the monopoly, I put it that the Post Office monopoly is far safer than the monopoly which is proposed in the Motion. Incidentally, it would appear that either the Mover and Seconder of the Motion have swallowed the Yellow Book or that something else has happened, because the Motion was originally divided. There has been a blending of colour, and it has produced a nasty one.
Mr. RAMSBOTHAM: I can make arrangements with the Liberal party just as well as the hon. Member's party.
Mr. BOWEN: The hon. Members have gone absolutely wrong in their references

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to the development of telephones. Time will not permit me to go into many details, and in any case the Postmaster-General can deal with them better than I can. What we are up against, in this matter of the supply of telephones, are the habits of the British people. Does the British business man want his telephone at his office, in his sitting-room, in his dining-room, in his bedroom and in his bathroom? Does he? They want them in America, and they have them. If hon. Members think that more telephones mean the laying down of more cables and that sort of thing, they have to bear in mind this—that even to-day the Post Office is feeling the effect of the War, like a good many other institutions. When the National Telephone Company's plant was given up, it was obsolete from top to bottom, and the Post Office has had to go through the process of steadily renewing that plant and laying down new cables in all parts of the country. Cables are being laid down now to deal with any number of telephones, and I understand that there can be no question of more employment in that connection. What you want to do in this country is to create the same type of telephone mind as that which exists in America—if you are going to compare with America—and no business mind can do that.
Mr. MONO: It is the business mind which has done it.
Mr. BOWEN: It is for the business mind in this country to make the demand for this service, and, as far as we can discover, the demand is not there. The telephone density in the United States in 1912 was, per thousand of the population, nearly six times as great as ours, and the United States population per telephone was 11, while that of Great Britain and Ireland was 64.7. That was the position before the Post Office took over the National Telephone Company in 1911. On 1st January, 1929, the telephone density in the United States was only four times as great as ours, and the population per telephone was 6.6 as compared with 25.8 in Great Britain. The first point which emerges from these figures is the question of whether any real comparison in telephones can lie between this country and the United States. I do not think that such a com-
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parison can lie, and I regret that time does not permit me to go into further details on that point. Coming to the question of surpluses in regard to telephones, the late Postmaster-General has declared that, while surpluses are accruing, they have been decreasing in value for some years. He has pointed out, however, that this is not due to any fall in revenue; that, on the contrary, the revenue is increasing, and that it is due partly to the policy followed, where possible, of reducing rates and even more to the development of the service. Again, our telegraph service is compared with America, and attention is called to the deficit created by the telegraph service. There has always been a deficit on the telegraph service. The Post Office had to take it over in 1868 at a very high cost, and it has had to bear the burden of a charge amounting to a good sum every year for all that time.
Viscount WOLMER: The hon. Member surely knows that that cost was written off and does not affect the position to-day.
Mr. BOWEN: I do, but the Noble Lord has referred to this deficit. I am pointing out that we cannot take the responsibility for it in these days, and that he must not blame the telegraphs. The late Postmaster-General gave the answer to this point—his statement must have been an answer to his own Assistant Postmaster-General who criticises the telegraph service, talks about the deficit, and makes comparisons with private companies in America. This is what the late Postmaster-General said in the House:
"The existence of a deficit on this portion of the Post Office work is not a phenomenon which is singular to Great Britain. On the contrary it is the common experience of practically every Government in Europe. They take the view that an efficient telegraph service confers such advantage on the citizens in general and in the amelioration of conditions of life in general, that it is worth while running even if it be run at a loss. There is much to be said for that and it ought to be borne in mind by some of those who are always rushing off to America for comparisons with regard to telegraph work in order to draw conclusions derogatory to State management …. The real truth is that the conditions of physical geography in America and the large distances between centres materially contribute to help telegraphic developments."

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He also said about the work:
"In the towns of America the telegraphic service is very much worse than our own and in the rural parts of America it ceases really to have any pretensions to be a telegraphic service at all. In Germany the ordinary telegraphic service is much slower. They have a system of urgent telegrams at triple the ordinary rate and a lightning service at 30 times the ordinary rate. Our best service in this country compares favourably with the best American practice and with the German lightning service. Our average normal speed of telegraphic operations is certainly up to that of any other country in the world, and is, I think, a great deal better than most of them. Indeed I believe it is true to say that it is better than any other."—[OFFICIAL REPORT, 12th July, 1928; col. 2501, Vol. 219.]
9.0 p.m.
I am compelled to read to hon. Members opposite the views expressed by their own Postmaster-General in the late Government. Finally, I submit that in the suggestion which has been made as to public utility companies, there is the danger that many people will be trapped into the belief that it is better to remove from the control of this House a big State service like the Post Office than to retain it under Parliamentary control, and that the public can get a better service in this way. The experience of the past condemns that idea. The old National Telephone Company was subject to endless criticisms, and it was, as the result of complaints from business men, that the State took control of it. Precisely the same thing happened in regard to the telegraphs in 1868. The private companies were working only where they could get the cream of the traffic and were not bothering about the cheaper areas. It is only an institution like the Post Office under State control which can cater for the community as a whole. The community as a whole is entitled to every consideration, and it is not good that the places with the greatest density of population should always have the best service. They ought to help to pay for a great national and general service. I cannot conceive that any service of that kind can be given except by an organisation controlled and owned by the State such as the Post Office. No other kind of service would come up to the standard I have indicated, and, therefore, I ask the House to support this Amendment which will be a declara-
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tion by the House of the view that we can interfere too much with the existing Post Office service to the damage of something which has stood the test for half a century.
Mr. H. W. WALLACE: I beg to second the Amendment.
In looking at this Motion, I am inclined to say, as the late Postmaster-General said about the Hardman Lever report, that it lacks definiteness. There is nothing definite in this Motion, and in the speeches from the Benches opposite we have not had a single definite charge brought against the efficiency of the Post Office. The Mover and Seconder of the Motion referred to the theft of registered letters and the loss of mail bags the suggestion being that the Post Office was responsible in every case for the loss of the mail bags. That, of course, is not so, because there are occasions on which the Post Office could not possibly be held responsible for the loss of a mail bag. The Seconder of the Motion made various suggestions on the question of a penny post, but it remains to be seen whether there will not be a great demand in this country for a share of the surplus of £9,000,000. We are asked to-night to appoint a committee of business men—presumably to go into matters such as I have mentioned. I suggest that there is no need to appoint a committee of business men to inquire into these comparatively trifling matters.
The suggestion has also been made that at the head of the divided Post Office service there should be a business man. Who is to be the business man? What are the qualifications of this business man? Where is this committee of business men to come from? Are we to get them from the mining industry, from the cotton industry, from the financiers, from the bankers? Who are these efficient business men? Judging by what has been happening in the City recently, in the cotton industry, in the coal industry, in the iron and steel industry, I suggest that the business man to-day does not stand in that position in which the public would trust him to inquire into the administration and efficiency of the Post Office. For the last 30 years committees of business men have been inquiring into one aspect and another of the administration of the Post Office, but not one

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of those committees has produced one jot of evidence to show that the Post Office is not efficiently managed. Take the Geddes Committee. He, I understand, held that committee as a super-business man, and you could hardly find a business man with greater qualifications. They inquired into the administration of the Post Office, and what was the wonderful recommendation that they made? That £80,000 a year could be saved. How? By robbing the postman of a pair of trousers and a coat every year. What community would want to pay for a committee to inquire into that sort of thing? Look at the economy of that proposition. They robbed the postman of a uniform and sent up the sick leave in the Post Office, which costs actually more. So much for the business man.
Reference has been made to the commercial accounts. I want to know of any institution besides the Post Office that publishes such a statement for the benefit of the public. The Mover of the Motion practically ignored all the valuable information contained in this commercial account, and said he was disappointed because it took so many months for it to be delivered. I will leave the Postmaster-General to deal with that point, but let us take these commercial accounts for a moment. They show that wages and salaries are down from 48.73 per cent. for 1927 to 46.79 per cent. for 1928, or a reduction from £32,554,519 to £32,265,464. Does that disappoint the business men?
Major SALMON: What about the increased turnover?
Mr. WALLACE: The percentage has fallen, and therefore the turnover does not count. The total operating expenditure is down from 82.00 per cent. for 1927 to 80.07 per cent. for 1928. The surplus for the year 1927 was £7,670,348, and for 1928 the surplus was £9,012,764. From 1912–13 to 1928–29 the community has secured from the Post Office a sum greater than £100,000,000. Show me any private business concern that has done as well. On each of those points I submit that the Post Office has given a good account of itself, and from the standpoint of the efficient business man, not one argument has been adduced here to-night to justify taking away the control of the Post Office from the Postmaster-General.
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Reference has been made to the deficit on the telegraphs. My hon. Friend the Member for Crewe (Mr. Bowen) has dealt with that question, but the deficit is a diminishing quantity, and I suggest that if the House of Commons in the past had not been so generous to private interests, that deficit would not have been as great as it has been, but it is now, happily, being steadily reduced. Under the Telegraphs Act, 1868, there was a subsidy to the Press of no less than £200,000 a year. What private business is going to do that? The right was conferred by the Telegraphs Act of 1868 on railway companies to send free telegrams on railway business. What private business is going to do that? The reduction of rates in 1865 was through a Private Member's Motion, which was carried by the House of Commons against the advice of the Administration of that day. I want to point out that the telegraphs really have been a successful proposition for the country as a whole, and when you take the balance-sheet and point to a deficit, the fact is that that deficit exists because of the generosity of this House in the past in making gifts to the Press and other concerns in this country.
There is one item in these accounts which I do not like. I find that the Post Office in 1927 paid nearly £3,000,000 for rent, and in 1928 just a little over £3,000,000. I would like to suggest that it is time the Post Office found out a way of securing premises without paying that great tribute every year in the shape of rent. Its idea! ought to be to own, not to hire, and I hope the present Postmaster-General will give that matter his very serious attention. If he does, I think he will be able to increase the Post Office surplus.
The Post Office is an organisation which enters into our social services. Through old age pensions, widows' and orphans' pensions, and national health insurance, it touches the homes of the people at every point. What is the value of those services? On old age pensions, for example, more than £98,000,000 is paid out. What private business is going to handle that, and in what way can a business man improve upon the present position in that respect? Take a post office counter. Go to the branch post office within a few yards of this building and watch the business performed there. The

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innumerable services granted to the public are such as to show the very complexity of the organisation which makes it possible to give those services, and that you cannot possibly measure those services by the ordinary standards. I am reminded that in one small town that I visited there is one post office, with one postmaster, with a turnover of thousands upon thousands a year, and in the same town there is a similar turnover, and it is handled by five bank managers. It has never yet been proved that the banker as a banker is more efficient than the Postmaster-General. As a matter of fact, the criticism at the present moment goes to show that the bankers are rather too generous and too easy-going.
It is true there has been very little public praise because there has been a surplus, as the public are accustomed to get a surplus, but, if there had been a deficit, the Press campaign would not have been very different from the campaign brought about by the Hatry crisis. In the Post Office there has been rationalisation. It is only in the last few years that this country has been giving any attention to rationalisation, but it is not new in the Post Office; it has been going on for years. The Noble Lord the Member for Aldershot (Viscount Wolmer) is reported as having said that the Post Office has invariably been unsuccessful when it has tried to compete with private enterprise. He knows that the Post Office has a motor service, and that not one of these vehicles is put on the road unless it has competed with private enterprise. No Post Office motor vehicle can take the road until it has beaten the private competitor. That is the Treasury condition, and the Noble Lord knows that every one of the 2,000 vehicles have come successfully through that test. I venture to say, and I feel that the Noble Lord knows it, that in the matter of motor cars, private enterprise cannot beat the Post Office.
With regard to the question of carrying parcels, the railway companies are under private enterprise. A written statement to the Royal Commission on Transport, presented on behalf of the London Chamber of Commerce by Sir Geoffrey Clarke, a former Director-General of Indian Posts and Telegraphs, and now deputy-chairman of the council of the London Chamber of Commerce, stated:
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"The difference in time for delivering taken by the railway and Post Office services respectively is so marked as to justify the assumption that, with better organisation by the railway companies, a very great improvement could be shown in this respect."
In cross-examination, he said that the statement was based on the experience of many members of the Chamber of Commerce. It was their opinion
"that the railway parcels service generally cannot compare with the postal parcels service for speed."
And the Post Office parcel traffic is going up. My hon. Friend has referred to the transfer of the beam and wireless service. I do not propose to dwell upon that matter, except to say that some of us have anticipated this smooth and sweet suggestion that the telegraph and telephone services should be transferred like wireless to another body. We know that the Press campaign will go on, and that hon. Gentlemen opposite will seek to find arguments to justify that transfer; and the reason for the transfer is the simple one that private enterprise sees in it a profitable field of exploitation.
It would be useful if I mentioned the history of the transfer of the telephone service, because the argument is that these changes should be made to help the business man, and that we ought to go back to the time when the telephone service and telegraph service were under private enterprise and under the control of business men. When the telephones were run by private enterprise, there were continuous complaints. The Associated Chambers of Commerce passed a resolution in favour of Government-control of telephone communication. In 1895, the agitation against the National Telephone Company grew strong, with the result that the Government in 1896 appointed a Committee, which recommended that local authorities should be licensed to undertake telephone services. In 1899, the Treasury received a deputation from Chambers of Commerce who asked the Government to acquire the National Company undertaking and to work it as a branch of the Post Office. In the Debate in the House of Commons on 9th August, 1905, the hon. Gentleman the Member for West Birmingham (Sir A. Chamberlain) said that experience had
"proved that competition did not secure a cheap and efficient service."

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The late Postmaster-General, speaking at Croydon Constitutional Club on 11th March, 1929, as reported in the "Croydon Advertiser" of 16th March, said:
"The future of the telephone was settled in 1911 with universal consent after many and long complaints, largely due to the chief commercial centres having the best attention. Places that did not pay were left out or neglected by the National Telephone Company."
That is the testimony of the late Postmaster-General. On the question of the habits of business men, here is the testimony of Mr. O'Brien, an American business man:
"After all is said and done, it is probably true that there are other reasons than the question of Government or private operation There is the matter of fundamental difference in methods of business in different countries—some rapid, some easy going."
Perhaps he means the man who works five days a week and goes to his golf at week-ends, or perhaps he means the guinea pig director who was spoken of by the right hon. Gentleman who usually sits on the Benches opposite. He goes on:
"My experience in England has been that there is no great pressure anywhere at any time. Probably that is one of the strongest reasons why England is still at the foot of the ladder of the telephone development."
I assume that this gentleman imagines that we on this side go slow and go easy, and that we do not like to be bothered by the telephones. What is the use of saying that in America one person in six has a telephone. Why do not hon. Members opposite put this simple test: How many workers in this country would have a telephone if they were paid the wages that would enable them to afford one? The Noble Lord the Member for Alder-shot has dismissed a plea that big savings accrued to telephone users by the rate reductions in 1922. The late Postmaster-General did not agree with him. He said that the savings to users of the telephone between 1922 and 1927 were £3,000,000. I should be glad to see how the Noble Lord disposes of the argument of his late chief.
Viscount WOLMER: The saving was related to the year before.
Mr. WALLACE: At any rate, there was a saving. Speaking in the House on 14th July, 1926, the late Postmaster
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General, dealing with the reduction in the telephone surpluses, said:
"This is not due to any fall in revenue. On the contrary, the revenue is increasing. It is partly due to the policy, where possible, of reducing rates, and even more, it is due to a development of the service which entails the carrying of what I have before in this House called a large and growing uneconomic fringe of business. If you want to develop the service, it entails laying down plant which cannot immediately begin to be profit-bearing."—[OFFICIAL REPORT,14th July, 1926; col. 437, Vol. 198.]
I put it to the House that if this Post Office business were under private control, the chief object would be the earning of profits and not the giving of service.
We come to the telegraphs. In the same way the telegraphs were transferred from private control for the simple reason that the Chambers of Commerce of that day were complaining. In support of what I have just said about the object of private enterprise being profit, let me quote the evidence given when an inquiry was being conducted into the transfer of the telegraphs from private to public ownership. In giving evidence before the Select Committee on Telegraphs in 1868 the representative of one of the companies when questioned about the opening of new offices, said:
"Of course, it would be very desirable to open one for the public good, but it would not be desirable for us, because it simply would not pay."
Later on he said:
"We always look first to profits and then to the public interest."
The same representative said:
"Yes, I give my evidence with reference to the company's interest, and with reference to paying a dividend. That is my business."
The question put to him was:
"And as large a dividend as possible? "
To this he replied, "Quite so." Practically all the Chambers of Commerce of that time petitioned in favour of State purchase with cheaper telegrams. The position at the moment is that we have a Postmaster-General who represents the public, who are the users of the Post Office. Alongside the right hon. Gentleman there sits a committee of business men. I have not heard one of those gentlemen quoted in the Debate to-night in support of this Motion. I feel that the staff, those who work in the Post

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Office and who have earned and created a surplus of £9,000,000, ought to be invited to sit alongside and to give advice on the development of the service. The consumer and the producer in this case are embodied in the civil servant, and he does accept the point of view that this service exists for the benefit of the public. It is not true to suggest that the workers in the Post Office seek to run it for their selfish ends. I submit that in that way is to be found a new line of advance.
In the development of the Post Office the goodwill of the staff is essential. The Mover of the Motion spoke of the Bell Telephone Company handing back a sum of something like £9,000,000 to the staff. I could wish that in this country the Postmaster-General had done the same thing. I am amazed to hear such a speech coming from the benches opposite because in the case of the late Postmaster-General his reward for the staff was to endeavour to reduce their wages. True, the surplus was going up and he had thousands of people starving, and servants coming into the dock in the police courts arrested for thieving who were in receipt of wages which gave them a standard of living lower than that provided by the Poor Law authorities. The only contribution he could make to the goodwill of the staff was to endeavour to reduce their wages. I do not think the present Postmaster-General is likely to take that line.
My last word is that this is not a business matter as such. At the head of the Post Office we want an efficient man. I believe we have an efficient man in the present Postmaster-General. It is not a committee of business men we want. We want a Postmaster-General who will use his powers and insist upon developing the Service in the interests of the community. I should like to say to him that if the Treasury stand in the way of his developing that Service, let him come to this House and let the House help him to put the Treasury in its proper relation to the Post Office. We do not want a committee of business men to tell us that, but simply a Postmaster-General who will take his courage in both hands. The Noble Lord opposite was Assistant Postmaster-General to his late chief, and although they knew the Post Office was
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labouring under all these evils, not a word was said in this House about Treasury control. I charge, them with neglecting the development of the Post Office, and I hope that the present Postmaster-General will take his courage in his hands and be prepared to develop this Service.
Viscount WOLMER: I think the whole House is under an obligation to my hon. Friend the Member for Lancaster (Mr. Ramsbotham) for raising this matter this evening in a very interesting speech. It is a matter which, in my view, urgently requires discussion in this House, and the time at our disposal on a Wednesday evening is hardly adequate to cover such a big subject, or to enable all Members who are interested in it to give expression to their views. Therefore, I shall be as brief as I can within reasonable limits. I had hoped that the Postmaster-General would have spoken earlier in the Debate, and I have risen now only because I understand that the right hon. Gentleman intends to insist upon his constitutional right of winding up the Debate. When I raised this matter publicly in the newspapers, I was making no attack upon the right hon. Gentleman at all, but he was good enough publicly to accuse me of making mis-statements and uttering half-truths, as he called them. I think he also accused me of rancour. With the exception of one small detail in regard to the Sheffield exchange, he has not shown, in a single one of the statistics I have given publicly, any inaccuracy or untruth. I was hoping that the right hon. Gentleman would have replied and dealt with these statements, which he says are inaccurate, in such a way to-night as to give me some opportunity of replying to him, but as I have not that opportunity, I take note of the fact that the right hon. Gentleman has, apparently, no comment on the facts to which I have given publicity which he can make in front of my face so that I can reply to him. I raised this matter not as an attack upon the right hon. Gentleman, and not as a party question, but because I came away from that great Department convinced that the men and women working in it were not getting a fair chance and never would get a fair chance as long as it was organised in the way it is organised, and that the industry of this country, which is dependent

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upon the Post Office for means of communication, would never get the service it requires until that reform took place.
The difficulty I am up against in this Debate is the atmosphere, if I may say so without offence, which surrounds my hon. Friends opposite. They regard a proposal of this sort as something so wrong as to be almost indecent. I will endeavour to argue this matter with them in as dispassionate a way as possible, facing the facts together as colleagues rather than as antagonists. To show the House the frame of mind in which some hon. Members opposite approach this question I will quote the speech of the hon. Member for East Walthamstow (Mr. Wallace) who has just sat down. He told the House a few minutes ago that a number of Commissions had inquired into the Post Office and that not one of them had been able to bring any evidence of inefficiency against the Department, and that the Geddes Committee had only been able to recommend a reduction of £80,000 in the expenditure of the Post Office, to be saved at the expense of the postmen. I have here the Report of the Geddes Committee. May I read to the House a summary of what the Geddes Committee recommended? The first recommendation is that a regular and systematic check between traffic and staff should be instituted for the postal services.
Mr. BOWEN: It was already in existence.
Viscount WOLMER: The hon. Member is mistaken. It was not in existence then. This Report was delivered in 1922. The Committee pointed out that there was no regular check between traffic and staff. The matter was considered by the Secretary's office at Saint Martins-le-Grand for two years after the publication of the Geddes Report before any action was taken. In 1924 the readjustment first commenced, and a very valuable reform it has proved. Over a million man-hours annually have been saved in that item alone, although it was only possible to bring the scheme into effect in 60 per cent. of the offices. I give that as the first instance. The second recommendation of the Geddes Committee was: The cost of the indoor force can be reduced to the extent of £150,000; the cost of the outdoor force can be reduced to the extent of £200,000; the cost
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of the telephone and telegraph staffs can be reduced by £40,000; and the provisional estimate of £59,300,000 can be reduced to £56,500,000. The hon. Member for East Walthamstow told the House that the Geddes Committee had only been able to recommend a reduction of £80,000. In fact, the Geddes Committee recommended a reduction of £3,000,000. I merely give that as an example of the terrible incapacity, if I may say so, that hon. Members opposite have of facing the facts.
Mr. WALLACE: I was meeting the statement that there had been a charge of inefficiency against the Post Office. True, a suggestion may have been made which has resulted in a reform, but nothing has been produced yet, even by the Noble Lord, to show that there was a charge of inefficiency.
Viscount WOLMER: In addition to the Geddes Committee there was the Hard-man Lever Committee; and there was also the Report of a Select Committee of this House on telephones in 1922, of which Sir Evelyn Cecil was Chairman and on which there were two very well known Members of the Labour party. This Committee delivered a unanimous report in which the first recommendation is that a more businesslike reorganisation of the Post Office should take place. In the instances I ventured to give publicly I gave 16 sets of figures which, I say, have not yet been challenged in any particular, except in regard to the one detail. Let me put this to hon. Members. Are they really satisfied with the position in which we find ourselves in regard to telephones? They say that the United States of America does not provide a fair comparison, that the habits of the people are different, that conditions are easier, and that the people are wealthier. But it is not only the case of the United States of America. There is the United States of America, then Canada, then New Zealand, then Denmark—Denmark has three times as many telephones per head of the population as has this country—then Hawaii, then Australia, then Sweden and Norway, Switzerland, Germany, Iceland—and then Great Britain! Are hon. Members really satisfied with our position?
Take the cities of the world. Cities like Montreal, Baltimore, Copenhagen, Hamburg and Berlin have far more telephones

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per head of the population than London. I ask them whether they are satisfied with that? What is their reply? Their reply is, first, that the National Telephone Company was not a success. That has been said to-night. Why was the National Telephone Company not a success? For all I know it may have been badly managed. I am not in the least concerned to defend the National Telephone Company. I never had anything to do with it. But just consider the conditions under which that company had to work. The Post Office owned all the trunk lines and in the 'eighties and the' nineties the Post Office were afraid of the telephone service, thinking it was going to kill the telegraphs. Throughout the whole of the existence of the National Telephone Company the Postmaster-General of the day—all parties were involved—used his powers to thwart and impede the National Telephone Company and the municipalities who had their own telephones. You had not co-operation, or even competition, but a sort of dog-in-the-manger policy between those two organisations which absolutely prevented telephone development in this country. It is quite unfair to say that either private enterprise or Socialism had a chance.
Since the system was taken over in 1912 we have had 17 years of experience of the management of the telephones by the Post Office, and I say that the result of that 17 years is not good enough. Let me appeal to hon. Members to try to get out of their heads the idea that this is primarily a question of private enterprise versus Socialism. What we are asking for is that there should be an inquiry into the present organisation of the Post Office in order to see whether that organisation can be improved and whether the service can be improved. [An HON. MEMBER: "You managed it for five years, why did not you reform it?"] The hon. Member opposite asks why I did not reform the Post Office. What I am now suggesting is that the Post Office should be handed over to a public utility company, and in my opinion you will never get a maximum of efficiency until you have done that. Hon. Members opposite are attacking the late Government for not having done that. May I point out that we did with regard to the beam service, and hon. Members have never ceased to attack us for doing
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so. In one breath they are attacking us for not having carried out the remedy which I am arguing for, and in another breath they attack us for doing the very opposite.
I come back now to the question of a comparison with America. Hon. Members must really face the facts in that respect, and it will not wash in argument to say-that the conditions in this country are so exceptional and difficult that, of all the countries in the world, ours is the only country where telephones cannot be maintained on an economic basis. We have been told that the working men of America can afford to have the telephone in their houses, and that the working men of England cannot afford it. May I point out that the working men of Sweden are not better off than the working men of this country and the telephone is brought to them. The same is true of Denmark and Switzerland, where the telephone is brought to them much more cheaply than in this country, I know there are always some difficulties in regard to comparison, but I should like to give what I think is a very striking example between two telephone areas which are well known, and I think a very good comparison can be made between them. It is only a small example, but it is an exceedingly instructive one. I wonder if the House knows that up to 1923 the telephones in Jersey were controlled by the Post Office, whereas those in Guernsey were run independently. There is no difference in the conditions of the population between Jersey and Guernsey, and no one can point out any differences either racial, occupational, geographical or economic. The only difference was in the management of the two telephone services. What was the result in 1923? In the Guernsey area, with an independent service, the number of persons per telephone was 13, while at Jersey, which was run by the Post Office, the number was 31 per telephone. That shows that there were two and a-half times as many telephones in Guernsey as in Jersey, which was run by the Post Office. When I asked for the official reason for this discrepancy, no explanation was forthcoming and I merely cite that as an example. We cannot be expected to be satisfied with that state of affairs.
Mr. BOWEN: I am sure that the Noble Lord does not desire to make a misstate-

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ment. Does the Noble Lord know of the exceptional circumstances in regard to the desire of the Jersey people to have control of their own telephone arrangements and what arrangements were made for the transfer? Can he give any published figures?
Viscount WOLMER: I am not surprised that the people of Jersey wished to have their own telephones. In 1023 an arrangement was come to under which they were given their own telephones, and since then they have increased their telephone density by 100 per cent., and they have already gone a long way to catch up to Guernsey, having one telephone per 15 persons to Guernsey's 10.
Mr. BOWEN: Can the Noble Lord tell us what is the difference in the pay of the staff between Jersey and this country?
Viscount WOLMER: Not without notice, but I do not think that particular point affects this question. The hon. Member raises the question of the staff, and I want to say a few words on that question. I think it is a pathetic spectacle to see the representatives of the staff standing up for a system which is prevented by its inefficiency from expanding as it ought to expand. The staff are the greatest sufferers by this state of affairs. The position of the staff in the telegraph service is one which must evoke the sympathy of every one of us. The operators in America are holding their own against the telephone company, and they have a future in front of them. The future which our operators have in front of them is a very different story. I would like to draw attention to a very interesting comparison which I have recently seen between the conditions of the men employed by the Imperial Communications Company—the merger which has taken over the beam wireless system—and the men who remain in the cable room of the Central Telegraph Office. When the Imperial Communications Company took over the beam wireless and the Atlantic cables, hon. Gentlemen opposite strongly advised the telegraphists in the cable room not to accept the terms offered to them—
Mr. BOWEN: Can the Noble Lord give us the reference?
Mr. SPEAKER: The hon. Member has already made his speech, and I think he
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might allow the Noble Lord to complete his argument.
Viscount WOLMER: I intend to answer the hon. Member. He asks me for evidence, and I will read to him a letter that appeared in the November issue of "The Overseas Telegraph," the Journal of the Union. This letter was written by one of the men who is now working in the Cable Room at the Central Telegraph Office. He wrote:
"My representatives had been unable to recommend the final terms offered by the new company "—
and, accordingly, he and a number of his colleagues declined to take service with the new company which has taken over the beam wireless and the cables. He went on to say in his letter that he had been to see some of his friends who had taken service with the company, and he found that they were not only getting very much better pay than the men who remained at the Central Telegraph Office, but also that they were very much more contented. He writes:
"I put the obvious question to them, 'Are you sorry you transferred?' and their laughing and emphatic negatives dispelled all doubts from my mind. I did not find one man who would return to the Cable Room, hut all were very bitter that the Department had allowed them to leave without so much as a letter of appreciation of the services which they had rendered to the Post Office."
[HON. MEMBERS: "Who was in charge?"] The present Postmaster-General was in charge when those men left.
The POSTMASTER-GENERAL (Mr. Lees-Smith): I must interrupt the Noble Lord. I sent a letter of appreciation on the day of the transfer.
Viscount WOLMER: Unfortunately, these men do not appear to have received it. Perhaps it was lost in the post. The letter concludes:
"I returned from my visit with conflicting thoughts. I wondered if it were possible to create the spirit of success in the Cable Room that I felt in the Beam Section at Radio House; if that desire for the company's success could be engendered in the Cable Room for the Room's success; and I realised, as never before, the wisdom of men like Ford, the motor magnate, in granting good treatment to their staffs, and demanding good work in return."
The representatives of the men are doing their constituents an ill service in this

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matter. For years past the cable companies have paid their operators better than the Post Office has paid its operators. Hon. Members opposite know that, and cannot deny it. The wages paid by the telephone and telegraph companies in America are infinitely better than the wages paid by the Post Office, and hon. Members opposite know it. [Interruption.]
Mr. KIRKWOOD: Why did you not make them better when you were in charge?
10.0 p.m.
Viscount WOLMER: The point is that you do not serve the interests of the men by obstructing schemes of rationalisation. In order to rationalise, it is no doubt first, necessary to economise, and it may mean the initial dismissal of a large, number of men, but, if the rationalisation is carried through properly, and the result is that you can produce the article more cheaply, so as to lead to an expansion of your business, in the end you are able to pay far better wages, and far more in wages, than you were paying before. That has been the experience under every scheme of rationalisation, and yet the hon. Member for Crewe (Mr. Bowen) is taking credit to himself for having opposed and obstructed the rationalising schemes which were inaugurated by my right hon. Friend the Member for South Croydon (Sir W. Mitchell-Thomson). If the Post Office were efficiently managed, then, ultimately, the staffs would not only be better off, but the development of the telephone and telegraph services and of the postal service would give opportunities for far greater employment and far better prospects of promotion for the staff than they can hope to have at present. We have heard a good deal about statistics to-night, but there is one figure among those which have been given on which I would like to lay particular stress. The average cost per telephone in this country is £77, and the average cost in America is £47. There is nothing that the Postmaster-General can say to dispute that fact, and it really is the acid test in regard to the whole question of the telephone service. The reason why our charges cannot be reduced is that our costs are nearly double those in America, in spite of the fact that the American wages
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are very much higher than ours. That is due to lack of efficient management at St. Martins-le-Grand. I am not attacking the Postmaster-General; I am not attacking anyone; I am merely saying that the system is impossible. It is impossible to have a great industry like this, employing nearly a quarter of the number of people employed in the coal mines, one of the greatest industries of this country, under the nominal charge of a politician who on the average changes every two years. He has to leave the Department by the time he has really got to know it. Moreover, none of his advisers have had any business experience, and They are paid such low salaries that it is impossible to get any leading technician or business administrator in from outside. It is most unfair that the engineers of the Post Office should be paid far less than engineers outside, and it makes it very difficult to get in new blood from outside. [Interruption.] If hon. Members had done me the honour of being here at the beginning of my speech, they would know that I then pointed out that my proposal was that this great industry should be taken away from Civil Service conditions altogether, that it should be taken away from the control of ephemeral politicians altogether, and should be treated as a public utility service, like the great organisation that has taken over the beam wireless and the cables.
Mr. KIRKWOOD: Is it not the case that the ex-Prime Minister reproved the Noble Lord for using that same expression, and that his mother sent him away for a holiday as a result of that reproof?
Viscount WOLMER: My Leader very properly reproved me for making a speech without taking the precaution to find out whether reporters were present. It was a most indiscreet thing to do, and I hope that my hon. Friend will never do it himself. [Interruption.] Really, this is not a laughing matter. The interests of this country are vitally concerned, and the interests and welfare of this great staff, who are dependent on the Post Office for their livelihood, are at stake. It is not a question of Socialism or anti-Socialism that we are discussing; it is simply a question of common sense, business organisation; and if hon. Members opposite are not afraid to face the facts, they ought to welcome a com-

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mittee of inquiry. We want a committee of inquiry, and we want its terms of reference to be as wide as possible. "We want the inquiry to be undertaken as soon as possible, and we want to ensure that its report is not-pigeon-holed. There have been in the past many sectional reports on the Post Office, and to a large extent their recommendations have been pigeon-holed. That has happened because it has been impossible to graft the methods of efficient business on to the organisation of a Government Department. A Government Department is not intended to function as a business; it is intended to administer politically. Its organisation is designed to that end, and, if you try to apply a machine designed for one purpose to a different purpose, you will not get efficient results. In that inefficiency, not only will the trade and industry of this country suffer, but also the men and women who are dependent on the industry for their livelihood.
Mr. G. MIDDLETON: If I had the will to attack the Post Office, I hope I should be able to make out a very much stronger case than we have heard from the other side, but I find myself in the extremely difficult position for the moment of defending where I have been accustomed to attack. The Noble Lord said that the staff of the Post Office had a good deal to be dissatisfied with, and I think I could endorse that as well as a great many other criticisms that might be levelled against the administration. But when he and his friends seek to remedy matters by taking the control away from the House of Commons and, under the guise of a public utility company, placing it in the hands of a board of directors who would manage this huge business from behind closed doors, the 230,000 people who look to the House of Commons for protection have a right to expect anyone who speaks on their behalf not to attack the Postmaster-General but to defend the Post Office from such a proposal.
The Noble Lord had an excellent opportunity for four and a-half years of putting some of the theories that he has preached to-night into operation. It would have been an easy thing for a Conservative Administration, when the telegraphists went over to the Communications company, to increase the wages of those who were left behind and were doing com-
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parable work to the same level, but he waits until the Administration has gone out and the Labour Government comes in, and in the first few days he launches a new attack against the Post Office. I have suggested to him before that it is a bad thing to go about crying stinking fish. I think he, as an ex-Minister, ought to try to encourage a pride of possession in the Post Office. It is the greatest national asset of its kind. It is the greatest institution of its kind in the world. The hon. Member for Crewe (Mr. Bowen) pointed out that it runs so smoothly that people only find out that there is a Post Office when something goes wrong. The great outcry that we have had lately about the loss of mail bags did not make itself heard during the time of the Conservative Government. It might be useful to point out that the loss of mail bags was greater under the Conservative Administration than under the Labour Postmaster-General. There were 41 lost in 1928, and the number dropped to 27 in 1929, and I believe the drop took place synonymously with the coming in of the Labour Government. As the Noble Lord is very fond of statistics, I should like to point out that, under his chief, the percentage of mail bags lost was 00006, which dropped when the Labour party came in to 00004.
Viscount WOLMER: What does the hon. Member mean to infer by that—that thieves are busier now?
Mr. MIDDLETON: The moral is that the expensive system of insurance which is being preached by many newspapers would mean that protection would have to be afforded to mail bags out of all proportion to the risks, and I understand that in the business world these things are worked out on very fine lines so that you make your protection costs cover the actual risks. I think anyone who has studied the question will agree that the loss under the present system is as low as anything could reasonably be. Similarly with registered letters. Every time a banker loses a registered letter, it is used as a new means of launching an attack on the Post Office. Taking this State asset as a whole and comparing it with public companies, such as railways, the comparison is all in favour of the Post Office.
We are asked to decide between the Motion and the Amendment. The House

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would make a fatal mistake if it listened for a moment to counsels which have for their object the transfer of the Post Office from the House of Commons to closed doors where it would be managed by a board of directors. I am surprised to find hon. Members below the Gangway supporting a Motion which is designed in the interests of big business, which is part of a scheme to create a public opinion which would enable some parts of the Post Office service to follow the beam service and be transferred to private enterprise. The Communications Company have already taken away from the Post Office the only paying part of the telegraph service, and now, if I read the signs aright, they are anxious that the latest greatest commercial development, the beam telephone, shall follow the beam telegraph. I want to warn the House that all these things are part of a carefully-woven plan to take away from the public one of its greatest assets. The Post Office makes enormous profits. There is no guarantee that under private enterprise those profits would be maintained, and there is every likelihood that the conditions of the staff would be worsened and that what goes into the Treasury at present in profits would go into the pockets of private persons.
Viscount WOLMER: Will the hon. Member mention a single company doing the same kind of work which pays worse wages than the Post Office?
Mr. MIDDLETON: The Noble Lord gets me on a raw spot when he talks about the wages of the Post Office. They are disgracefully low, and I hope, now that we have a Labour Government and a sympathetic Postmaster-General, we shall be able to look forward to an improvement in the conditions of postal workers. But I agree that it is a disgrace that the Post Office should make £9,000,000 profit a year out of the sweated labour of its employés, and, if we were discussing that question tonight, I should certainly desire to beat the Noble Lord in the competition to improve conditions. But the issue to-night is what the Noble Lord rejects. It is private enterprise versus Socialism, and it is on that issue that I hope the House will vote.
Mr. MANDER: It seems to me that in this Debate to-night we have had a curious reversal of the ordinary state of affairs, because the stern and unbending conservative attitude has been indicated from the other side, and I find myself in the unusual, but at the time time very agreeable, position of being in association with the radical and revolutionary reformers who sit above the Gangway. The issue to-night, to a very large extent, has been misconceived. The issue is not whether we should have nationalisation or private enterprise. That was decided a very long time ago. With regard to the Post Office itself, I believe that within its present limits it is run very well, with great ability, supported by a most loyal and devoted body of servants all over the country. I believe that to the full. The only point seems to be this: Have we said the last word with regard to forms of nationalisation? Have we learnt anything in the last 50 years? Is it not possible that we may be able to find some method of nationalisation keeping the various parts of the Post Office under public control, but in such a form as would give better results, better financial results, better wages, better employment, and greater efficiency all round? I would point out in this connection that the German Post Office, the German railways and the Belgian railways are run under the very kind of system which is being suggested in this Motion to-night.
Mr. SANDHAM: Why not start with the Army and Navy?
Mr. MANDER: I should like to make it quite clear in anything I am saying that I am speaking solely for myself. It is not being treated as far as I know—I hope not—as a party matter, but simply from the point of view of what is the best method of dealing with this problem. I do not think for a moment that there ought to be any change in the mail side of the Post Office; that is best left as it is. With regard to telephones and telegraphs, there is a good case for inquiry to see whether some alternative method of nationalisation and public control would not be more effective from the point of view of hon. Members on the opposite side who want to get the best results from any scheme of nationalisation which may be put into operation.
Mr. SANDHAM: Including the Army and Navy.
Mr. SPEAKER: If the hon. Member wishes to remain in the House, he must not interrupt.
Mr. MANDER: In this connection I should like to point out as rapidly as I can that there is an enormous variety of different systems in this country under public control and nationalisation. I do not know whether it is generally realised that there are concerns with a capital of something like £4,000,000,000, all of which are under some form of public or semi-public control. I would like to give the House some examples. National undertakings operated by the Central Government, in addition to the Post Office, are dockyards, war manufacturing departments, the Office of Works, the Royal Navy, Crown Lands, the Stationery Office, the Carlisle State Management Scheme, and the Ministry of Transport, which deals with roads that have a replacement value of £1,300,000,000; national undertakings operated by officially appointed ad hoc bodies—the British Broadcasting Corporation, the Central Electricity Board, the Forestry Commission; local undertakings operated by local authorities, with a revenue earning plant of £700,000,000—gas, electricity, water, trams and housing; local undertakings operated by officially appointed ad hoc authorities—docks and harbours—and 20 of the chief of these have a capital of £100,000,000, Port of London Authority, Mersey Docks and Harbour Board, Clyde Navigation, the Tyne Improvement Commission, and, in addition we have the Water Boards with a capital of something like £75,000,000. In London there are further examples of indirectly-elected ad hoc bodies—the Metropolitan Water Board, the Metropolitan Asylums Board, the Port of London Authority, the Thames Conservancy and other bodies of that kind.
Then there are different schemes operating under the Building Society Acts, and the Industrial and Provident Society Acts; and there is the co-operative movement as well. We have the Ecclesiastical Commissioners—that is not a private enterprise—who deal with property of the value of £50,000,000. The controllers of colleges, universities and schools deal with property worth some-
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thing like £100,000,000, and the Charity Commissioners deal with property of the value of £250,000,000. I mention these facts to show the wide variety of methods of control, and to point out that we have a wide choice. It may be that in the years that have gone by we have learned something and have got ideas that may be very effective in dealing with this particular problem.
A great many figures have been given in regard to the telephone service of this country, showing how backward we are compared with other countries. I will not repeat any figures that have been given, but I will mention certain figures that have not been dealt with. Let us take the number of telephone communications per head. In 1927 we were thirteenth on the list. Our average was 28.6 conversations per head, compared with 221 in Canada. Take the number of telephones in London as compared with New York, cities with more or less the same population. In 1028 the number was 578,000 in London and 1,600,000 in New York. Take the case of Leeds and Minneapolis, cities of approximately the same population, and we find Leeds with 19,000 telephones and Minneapolis with 122,000. There must be some very good reason for that state of things.
In regard to the capital that is put into the telephone business every year in the way of development, we find that in this country it has come down to an average of something like £10,000,000 a year for the last four years. The increase that has been brought about by the Lord Privy Seal, in order to find work, is very small. While the amount spent for development in this country has only averaged £10,000,000 a year, the amount spent in America in the development of their telephone system is estimated this year to amount to £140,000,000 compared with £110,000,000 last year, or more than ten times as much as we spend in this country. That is very largely due to the fetters and manacles that are put upon the telephone system in this country by the Treasury, which prevent a great development of expenditure in these directions. There is a vast opportunity for development of the present system, but we cannot take advantage of it owing to these restrictions. By a proper system of propaganda and advertisement it would be possible to get

559
business all over the country, by persuading people to install telephones, which they do not know about or do not appreciate at the present time.
I am glad to have an opportunity of saying a word from these benches, although I may be the only speaker. I do urge that this question should not be looked upon as a division between Socialism and private enterprise, because it is nothing of the kind. It is an attempt to find out, by a non-party inquiry, whether there is not some alternative method of nationalisation that will give better results. This does not necessarily involve any criticism of the Post Office servants, very able men and women who conduct the affairs of that great national industry. They are doing their best within the limits of the existing system. We want to make the system more elastic and wider so that they can give still better results under happier conditions. I support the proposal for an investigation, because I believe that it will do something to give more employment in this country, to give a more efficient system, to raise money for the State, and to give those engaged in the telephone industry far wider opportunities of advancement and better wages than they can possibly hope to have under the existing system.
Mr. LEES-SMITH: We have had a valuable and a very friendly Debate, and I wish to thank the Mover of the Motion for giving the Post Office one of the rare opportunities it has of figuring either in questions or in debate in this House.
Viscount WOLMER: Parliamentary control!
Mr. LEES-SMITH: A great number of points have been raised, and while I do not think I shall be able to deal with all of them I will endeavour to deal with the larger proportion of the criticisms which have come from hon. Members opposite. In doing so I am justified in giving the warning which seems to have aroused some indignation in the Mover of the Motion, that the fact that there is great public discussion and criticism of the Post Office is not in itself a proof that the Post Office is inefficient. The public have the right to criticise the Post Office because, unlike a private company,
560
it is their own property. When hon. Members opposite wish to hand over the Post Office to some kind of profit-making company I must say that if the great staple industries of this country, like cotton, iron, steel and coal, had had to stand up for the last 50 years to the day to day criticisms and the bombardment in this House which the Post Office has had to face, I am perfectly sure that they would not have stood the test as well as the Post Office. And they would have been saved from a good deal of that self-satisfied individualism which in the absence of criticism, has largely helped to lead them to their present position, a self-satisfied individualism which was not entirely absent from the speech of the Seconder of the Motion.
Hon. Members have made a number of references to the recent discussions on the loss of mailbags in the care of the Post Office, and I think it will be valuable if I take this opportunity of making a few observations on this matter. The number of mailbags lost and tampered with in the year 1927 was 57, in 1928 it was 76, and in 1929 it was 56, and that is about the average. The number has rather diminished during the period I have been in office, but I notice that since the Labour Government have been in office the loss of one mailbag occupies a much greater space in the newspapers than all the mailbags lost in a year under the last Government. In order that this matter should be regarded with some sense of proportion let me point out that although 56 mailbags were lost during last year 40,000,000 were carried in absolute security. As a matter of fact, if you take the proportion of losses to the value of goods carried, the losses now are less than they were before the War, and they are undoubtedly less in the Post Office than in the railway companies or any other outside organisation. As I have said I think that the public, nevertheless, have a right to complain, and they have that right because they have learnt to expect a higher standard from the Post Office than from the outside transport organisations. That high standard will be maintained.
Mr. GRANVILLE GIBSON: Has the right hon. Gentleman any idea of the financial losses in these mailbag thefts?
Mr. LEES-SMITH: Yes, I have, but for certain reasons I put it in this way:

561
Out of every £1,000,000 carried there is a loss of £50. That shows why it is the case that, as I understand, insurance companies consider it so negligible that the insurance rate is nominal. I would take this opportunity of explaining to the House what is the nature of the new problem with which the Post Office is confronted on this question. The new problem is arising from the methods which bankers are using for the purpose of sending their remittances. Before the War, when we had a gold currency, bankers sending their remittances from bank to bank and from head office to branches sent them in gold under their own protection and at their own risk. Now that we have a currency of paper notes they put notes worth thousands of pounds into an ordinary envelope, they register it for 3d., and they leave the Post Office to do the rest.
As a matter of fact the Post Office is now called upon to perform services for which it was not originally organised. It has not been expected hitherto to be the carrier of currency on a stupendous scale. This, of course, entails an extraordinary temptation to the Post Office staff, who know very well what these envelopes contain—a temptation which, I am glad to say, they have resisted. The losses are not due to the Post Office staff. The losses are due to the fact that this new development in Post Office duty is attracting the professional thief into the adventure of Post Office robbery. That confronts us with a problem which certainly had not faced us before. The Committee which was appointed by my predecessor has gone into this subject and has lately made its recommendations. I do not propose to take the House into my confidence as to what those recommendations are, but they include a number of precautions and securities which, I trust and believe, will prove effective. I may say that these precautions have necessitated the co-operation of the bankers. We have met the bankers and the banks are willing to undertake the trouble of the precautions which the new system necessitates.
I pass to some of the general criticisms which have been made against our Post Office system. Those criticisms, I notice, deal more with telephones than with the ordinary postal service which is, after all, the main business of the Depart-
562
ment. A great many figures have been given comparing our telephone rates with those of the United States, Denmark, Italy and, particularly, Sweden. Like other hon. Members I have spent a good deal of time in considering these comparative telephone rates of different countries, and on this point I have come to the same conclusion as my predecessor, namely, that these rates have such different meanings in different countries, they are given for such different kinds of services, and the conditions under which they are given vary so much, that very few useful results can be obtained from these comparisons at all. I take one instance because it has been the most frequently quoted in this Debate—the comparison with Sweden. I would point out that the Swedish rate which has been quoted is the ordinary rate, but that in Sweden, if you want to be sure that your message will go immediately, you have to pay a priority rate, which is twice the rate we have heard quoted here. [Rural rates in Sweden have also been quoted more than once; but in this country we establish a rural exchange if eight subscribers can be obtained, whereas in Sweden unless they can obtain 50 subscribers, those who wish to establish an exchange have to provide equipment, provide junction lines to the exchange, and pay the operators. Sweden has been quoted to us as an example of the method of developing rural telephones, but the fact is that, if we applied Swedish conditions to this country, the greater part of our rural telephone development would be wiped out.
A number of comparisons have been made between telephone development in this country and telephone development in the United States. Those comparisons seem to me to have little meaning. This is a small congested island. The United States is a vast continent, sparsely populated. I have been challenged by two or three speakers on a figure which seems to have got firmly into their minds. I have been told that the average capital cost of a telephone in the United States is £47 and that in this country' it is £76; and I have been told that that is the acid test of the relative efficiency of the two countries in this respect. But the House must take this into account, that undoubtedly the original capital

563
cost is greater in this country than in the United States, largely because the United States has a material part of its system above ground, whereas six-sevenths of our telephones are underground, and the initial cost is very much higher. I would point out, however, that we get the advantage of that initial increased expenditure in smaller depreciation costs and our operating costs are less, so that if you take the all-in annual cost, allowing for depreciation and interest, of a telephone in the United States and a telephone in this country, it works out at £9.17 in this country and £10.97 in the United States.
But, as I say, these comparisons cannot take you very far, and what is the fact of the matter, which every Member of this House knows is the case? The demand for telephones is partly, of course, a matter of habit and temperament, but apart from that it depends upon the population of a country and upon the income of that country. The population of the United States is double ours, and their income is a great deal move than twice that of ours. If you take any article in which the demand depends upon income and population, you will get much the same result by comparing the United States with this country, as in the case of motor cars.
I came into this House some weeks ago and listened to a Debate about electricity, and I found that hon. Members were making exactly the same speeches about electricity as they have been making to-night about telephones. I found them pointing out that we stood at such and such a place in the list of the countries of the world. I found them comparing the number of units of electricity used per head in this country with the number used in the United States, Sweden, and the other countries quoted to-night, and I listened to the answer, which was given by the late Minister of Transport, speaking from that box. This is what he said:
"We in this country are behindhand in electrical development …. I do not think it is the fault of any body in particular, though perhaps it is partly the fault of our national characteristic of individualism. Each and all of us like to carry on our business in our own way … and we do not, so quickly as other nations, combine together for mass enterprise, whether
564
it be municipal, national, or under private auspices."—[OFFICIAL REPORT 11th December, 1929; col. 508, Vol. 233.]
We have been attacked by a number of Members to-night on the whole ground of the system of telephone finance. You have to look at these questions not by-taking the telephones by then selves, but by comparing them with the other industries of the country, and if you do that, you find that our telephone finance has been a great deal sounder than the finance of most of the staple industries of this land. Look at the position of telephones. They are an expanding industry, an industry with an increasing demand, an industry which is bound to develop. An industry in that position a few years ago, if it had been in private hands, would undoubtedly have suffered from over-capitalisation. Take the cotton industry, with the re-flotation of mills and the over-capitalisation, for which it is paying the penalty to-day. Take even the motor industry. Although the technique of the motor industry has been quite progressive, the finance of the motor companies is, on the whole, most disappointing, because of the over-capitalisation which followed in the boom years immediately after the War.
The telephones, on the other hand, have been subject to the same temptation; they have been given the same advice. They are given that advice in the newspapers this morning by the Telephone Development Association; they are given it in the Liberal "Yellow Book," but they have not given way. They have steadily expanded about 8 per cent. every year; they have expanded more rapidly than any other country in the world except Australia, but they have done so continuously, steadily and evenly, without those booms and slumps which have been the curse of industry. I should take the opportunity of saying that the reason that the telephone industry has not made the same mistakes as other industries in the same position is because Postmasters-General have accepted the advice of their administrative advisers, those men who, as has been frequently said to-night, have not business ability.
I am defending the postal and telephone administration, but I do not wish it to be thought that, because I am now defending them against attack, I say that the Post Office is without any faults at all. I do not say that. What I do say is that,

565
so far as faults are revealed in the Post Office, the Post Office system enables us to correct those faults more readily than faults are corrected in private industry.
A good many references have been made to these Post Office commercial accounts. They show a surplus of £9,000,000, the highest surplus ever made in the history of the Department, and it is worth while remembering the simple fact that that surplus is going to the public benefit, instead of to increase those big profits which the Noble Lord has been pointing out to the commercial organisations whom he has addressed. It is important to point out, however, how these profits have been secured. They have not been secured by the increase in the revenue of the ordinary postal services, which are, so to speak, the easy money which the Post Office secures. They have been secured by a saving of £500,000 in the deficit on the telegraphs, in the saving of which almost half has come from improvements in administration, organisation and technique. Almost another £500,000 has come from the increased revenues on the telephones, an increase which has been due to a lowering of engineering costs and an improvement in engineering standards. Here you have an example of the fact that whatever criticisms are directed against the Post Office, those criticisms are being met by the present Post Office system. But compare these remarkable results with the other industries which are held up to us as an example. Compare them with the coalmining industry.
Mr. PYBUS rose—
Mr. SPEAKER: The hon. Member must not remain standing unless the hon. Gentleman gives way.
Mr. PYBUS: I do not want to interrupt, but is it quite fair to compare a monopolistic industry with one which is subject to world competition?
Mr. LEES-SMITH: I will deal with that point. To illustrate my argument, in an industry like the Post Office when reforms are needed, they can be carried through because there is a central authority able to force them through, but when you come to the coal mines, the cotton trade, and the iron and steel trades, which are not monopolistic, then, although they suffer from evils of internal organisation, those evils cannot be cor-
566
rected, because the interest of each individual firm is not necessarily that of the whole. The larger part of one Session of this House is taken up in doing for those industries, through State action, what they cannot do for themselves.
The Noble Lord made certain references to myself, and I do not intend to make any lengthy reference to him. I will only say that if he had been an official in the cotton industry, or the coalmining industry or the iron and steel trade, he would have been able to paint just as black a picture as he has of the Post Office to-night. Supposing he had been one of those officials and had become dissatisfied, and, nevertheless, had not lifted a finger to remove any of the evils which he found, and supposing he kept his position until he was turned out, then went and attacked his firm in the Press with the information he had obtained while in his official position. I venture to say he would have been able to draw a far blacker picture than any he has been able to draw of the Post Office.
There is one last thing about this Debate which I have noticed. It has been concentrated on telephones. Very few criticisms have been directed against the postal service, and I am convinced that if you took the opinion of foreign observers they would not agree with many of the criticisms in this Debate. In my first few weeks of office I found the Postal Union Congress sitting in London, representative, I think, of every country in the world, and I could not help being proud of the supreme position, the supreme prestige, which the British Post Office occupied; it showed that the foreign representatives there did not share the views of the Noble Lord. I am also glad to notice that when other States, such as South American Republics like Peru, want an administrator to come in from outside to control and reform their post office system they come to the British Post Office and do not go to the United States or any of those other countries for which the Noble Lord has an admiration so much greater than for our own service.
Sir CHARLES OMAN: I wish to take up and to deal with for two minutes the challenge of the right hon. Gentleman the Postmaster-General. He said that nobody had criticised the postal service to any great extent. I will give him a

567
criticism which I think is crushing. Before the War telegrams cost 6d. and letters were carried for 1d. A telegram now costs 1s. and the postage on letters is l½d. As the prices have been raised, surely the amenities and conveniences ought to have been proportionately raised; but the very reverse is the case, and we have in fact a very much worse service. I represent here a town of 70,000 inhabitants. It had seven posts a day before the War and now has only four. It had a post at 7 in the evening and another post at 10 o'clock in the evening; it now has no post after 4 o'clock in the afternoon. I know a cathedral town in the south of England which has no post after 2 o'clock. Do you call that efficiency? You charge a
great deal more for a much worse service. A letter to me posted in Sussex Square, London, at 11 o'clock on Saturday morning did not reach me until 8 o'clock on Tuesday morning. A letter posted in a village 19 miles from Oxford on Friday afternoon was not delivered in Oxford until Monday morning. Only 19 mile away ! Do you call that efficiency? saw know nothing less efficient than British Post Office at the present mom In regard to the delivery of letters, I that the efficiency of the British Office since the War has decreased, decreasing and ought to be improved.
Question put, "That the words proposed to be left out stand part of the Question."
The House divided: Ayes, 51; Noes, 187.

Division No. 158.]

AYES.

[11.0 p.m.

Acland-Troyte, Lieut.-Colonel

Gower, Sir Robert

Ross, Major Ronald D.

Albery, Irving James

Greene, W. P. Crawford

Salmon, Major I.

Atkinson, C.

Gretton, Colonel Rt. Hon. John

Samuel, A. M. (Surrey, Farnham)

Baillie-Hamilton, Hon. Charles W.

Gunston, Captain D. W.

Sandeman, Sir N. Stewart

Beaumont, M. W.

Heneage, Lieut.-Colonel Arthur P.

Simms, Dr. John M. (Co. Down)

Bevan, S. J. (Holborn)

Hennessy, Major Sir G. R. J.

Sinclair, Col. T. (Queen's U., Belfst)

Bourne, Captain Robert Croft.

Hudson, Capt. A. U. M. (Hackney, N.)

Skelton, A. N.

Bowyer, Captain Sir George E. W.

Kindersley, Major G. M.

Smith, Louis W. (Sheffield, Hallam)

Bracken, B.

King, Commodore Rt. Hon. Henry D.

Smith, R. W.(Aberd'n & Kinc'dine, C.)

Brown, Col. D. C. (N'th'l'd., Hexham)

Leighton, Major B. E. P.

Titchfield, Major the Marquess of

Butler, R. A.

Little, Dr. E. Graham

Todd, Capt. A. J.

Crichton-Stuart, Lord C.

Llewellin, Major J. J.

Ward, Lieut.-Col. Sir A. Lambert

Crookshank, Capt. H. C.

Mander, Geoffrey le M.

Warrender, Sir Victor

Erskine, Lord (Somerset, Weston-s.-M.)

Morris-Jones, Dr. J. H. (Denbigh)

Wolmer, Rt. Hon. Viscount

Ford, Sir P. J.

Nathan, Major H. L.

Womersley, W. J.

Forestier-Walker, Sir L.

Oman, Sir Charles William C.

Gault, Lieut.-Col. Andrew Hamilton

Penny, Sir George

TELLERS FOR THE AYES.—

Gibson, C. G. (Pudsey & Otley)

Roberts, Sir Samuel (Ecclesall)

Mr. Ramsbotham and Mr. Mond.

NOES.

Adamson, Rt. Hon. W. (Fife, West)

Clarke, J. S.

Hardie, George D.

Adamson, W. M. (Staff., Cannock)

Cocks, Frederick Seymour

Hartshorn, Rt. Hon. Vernon

Alpass, J. H.

Compton, Joseph

Haycock, A. W.

Ammon, Charles George

Daggar, George

Hayday, Arthur

Arnott, John

Dallas, George

Hayes, John Henry

Aske, Sir Robert

Dalton, Hugh

Henderson, Thomas (Glasgow)

Attlee, Clement Richard

Davies, Rhys John (Westhoughton)

Herriotts, J.

Ayles, Walter

Denman, Hon. R. D.

Hirst, G. H. (York W. R. Wentworth)

Baker, John (Wolverhampton, Bilston)

Dickson, T.

Hollins, A.

Baldwin, Oliver (Dudley)

Dudgeon, Major C. R.

Hopkin, Daniel

Barnes, Alfred John

Dukes, C.

Johnston, Thomas

Batey, Joseph

Duncan, Charles

Jones, Morgan (Caerphilly)

Beckett, John (Camberwell, Peckham)

Ede, James Chuter

Jowett, Rt. Hon. F. W.

Benson, G.

Edwards, C. (Monmouth, Bedwellty)

Jowitt, Rt. Hon. Sir W. A.

Bentham, Dr. Ethel

Edwards, E. (Morpeth)

Kelly, W. T.

Bevan, Aneurin (Ebbw Vale)

Elmley, Viscount

Kennedy, Thomas

Bowerman, Rt. Hon. Charles W.

Foot, Isaac

Kinley, J.

Broad, Francis Alfred

Forgan, Dr. Robert

Kirkwood, D.

Bromfield, William

Gardner, B. W. (West Ham, Upton)

Knight, Holford

Brooke, W.

Gibson, H. M. (Lancs. Mossley)

Lansbury, Rt. Hon. George

Brothers, M.

Gill, T. H.

Lathan, G.

Brown, C. W. E. (Notts. Mansfield)

Gillett, George M.

Law, A. (Rossendale)

Buchanan, G.

Gossling, A. G.

Lawrence, Susan

Burgess, F. G.

Gould, F.

Lawrie, Hugh Hartley (Stalybridge)

Buxton, C. R. (Yorks. W. R. Elland)

Graham, D. M. (Lanark, Hamilton)

Lawson, John James

Caine, Derwent Hall-

Groves, Thomas E.

Lawther, W. (Barnard Castle)

Cameron, A. G.

Grundy, Thomas W.

Leach, W.

Carter, W. (St. Pancras, S. W.)

Hall, F. (York, W. R., Normanton)

Lewis, T. (Southampton)

Charleton, H. C.

Hall, Capt. W. P. (Portsmouth, C.)

Logan, David Gilbert

Chater, Daniel

Hamilton, Mary Agnes (Blackburn)

Longden, F.

Lovat-Fraser, J. A.

Paling, Wilfrid

Smith, Ben (Bermondsey, Rotherhithe)

Lowth, Thomas

Palmer, E. T.

Smith, Frank (Nuneaton)

Lunnn, William

Parkinson, John Allen (Wigan)

Smith, H. B. Lees (Keighley)

Macdonald, Gordon (Ince)

Perry, S. F.

Smith, Rennie (Penistone)

MacDonald, Malcolm (Bassetlaw)

Pethick-Lawrence, F. W.

Smith, Tom (Pontefract)

McElwee, A.

Phillips, Dr. Marlon

Smith, W. R. (Norwich)

McEntee, V. L.

Picton-Turbervill, Edith

Snell, Harry

McKinlay, A.

Pole, Major D. G.

Snowden, Thomas (Accrington)

MacLaren, Andrew

Potts, John S.

Sorensen, R.

Maclean, Neil (Glasgow, Govan)

Price, M. P.

Stephen, Campbell

McShane, John James

Pybus, Percy John

Stewart, J. (St. Rollox)

Malone, C. L' Estrange (N'thampton)

Quibell, D. J. K.

Strachey, E. J. St. Loe

Marcus, M.

Ramsay, T. B. Wilson

Strauss, G. R.

Marley, J.

Richards, R.

Sullivan, J.

Marshall, Fred

Richardson, R. (Houghton-le-Spring)

Sutton, J. E.

Mathers, George

Ritson, J.

Taylor, W. B. (Norfolk, S. W.)

Matters, L. W.

Romeril, H. G.

Tinker, John Joseph

Maxton, James

Rosbotham, D. S. T.

Toole, Joseph

Messer, Fred

Rowson, Guy

Townend, A. E.

Middleton, G.

Salter, Dr. Alfred

Turner, B.

Mills, J. E.

Sanders, W. S.

Viant, S. P.

Milner, J.

Sandham, E.

Watkins, F. C.

Morgan, Dr. H. B.

Sawyer, G. F.

Watson, W. M. (Dunfermline)

Morley, Ralph

Scrymgeour, E.

Wellock, Wilfred

Morrison, Herbert (Hackney, South)

Scurr, John

Welsh, James C. (Coatbridge)

Mort, D. L.

Sexton, James

West, F. R.

Mosley, Sir Oswald (Smethwick)

Shepherd, Arthur Lewis

Whiteley, Wilfrid (Birm., Ladywood)

Muff, G.

Sherwood, G. H.

Whiteley, William (Blaydon)

Muggeridge, H. T.

Shield, George William

Williams, David (Swansea, East)

Murnin, Hugh

Shiels, Dr. Drummond

Williams, T. (York, Don Valley)

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

Shillaker, J. F.

Wilson, R. J. (Jarrow)

Oliver, P. M. (Man., Blackley)

Simmons, C. J.

Palin, John Henry

Smith, Alfred (Sunderland)

TELLERS FOR THE NOES.—

Mr. Bowen and Mr. Wallace.

Main Question, as amended, put, and agreed to.

Question proposed, "That those words be there added."
Several hon. Members rose—
It being after Eleven of the Clock, Mr. SPEAKER proceeded to interrupt the Business.
Mr. LEES-SMITH rose in his place, and claimed to move, " That the Question be now put."
Resolved,
"That whilst this House will welcome any improvements in the postal, telegraphic, and telephone services, it declares that the continuation of the present high standard of these services is dependent upon the maintenance of the Post Office as a national institution subject to the control of Parliament."

ORDERS OF THE DAY.

  ESTIMATES.
  Ordered,
  "That Mr. Foot be discharged from the Select Committee on Estimates and that Major Nathan be added to the Committee."—[Mr. T. Kennedy.]

CONSOLIDATION BILLS.
Ordered,
"That Mr. Shakespeare be discharged from the Joint Committee on Consolidation Bills and that Mr. Philip Oliver be added to the Committee."—[Mr. T. Kennedy.]

POOR LAW BILL [Lords].
Read a Second time. Bill committed to a Committee of the Whole House for To-morrow.—[Mr. T. Kennedy.]
The remaining Orders were read, and postponed.

POOR LAW BILL [Lords].

  ADJOURNMENT.
  Resolved, "That this House do now adjourn."—[Mr. T. Kennedy.]
  Adjourned accordingly at a Quarter after Eleven o'Clock.

  CHINA (BRITISH MINISTER).
  CHINA (BRITISH MINISTER).
  SLAVERY.
  SLAVERY.
INDIA.
  AGRICULTURAL SERVICE.
  AGRICULTURAL SERVICE.
  LABOUR ADMINISTRATION, MALAYA.
  LABOUR ADMINISTRATION, MALAYA.
  EDUCATION.
  EDUCATION.
  WAR GIFT.
  WAR GIFT.
  GRENADA (POLICE FORCE).
  GRENADA (POLICE FORCE).
  WEST INDIAN SUGAR COMMISSION (REPORT).
  WEST INDIAN SUGAR COMMISSION (REPORT).
  MALTA (POLICE FORCE).
  MALTA (POLICE FORCE).
  HONG KONG (WOMEN AND GIRLS).
  HONG KONG (WOMEN AND GIRLS).
EMPIRE MARKETING BOARD.
  ADVERTISING.
  ADVERTISING.
  EXPENDITURE (CONTROL).
  EXPENDITURE (CONTROL).
POST OFFICE.
  WIRELESS STATION, CUPAR.
  WIRELESS STATION, CUPAR.
  TELEPHONE RATES.
  TELEPHONE RATES.
ROYAL NAVY.
  HYPROGRAPHIC WORK.
  HYPROGRAPHIC WORK.
  CEREBRO-SPINAL MENINGITIS, GIBRALTAR.
  CEREBRO-SPINAL MENINGITIS, GIBRALTAR.
  NEW CONSTRUCTION.
  NEW CONSTRUCTION.
  OFFICERS' PAY.
  OFFICERS' PAY.
  PERSONNEL AND MATERIAL (GREAT BRITAIN, UNITED STATES AND JAPAN).
  PERSONNEL AND MATERIAL (GREAT BRITAIN, UNITED STATES AND JAPAN).
  TUG "ST. GENNY."
  TUG "ST. GENNY."
  GENERAL MESSING SYSTEM.
  GENERAL MESSING SYSTEM.
  ESTABLISHED MEN, DOCKYARDS.
  ESTABLISHED MEN, DOCKYARDS.
  ANIMALS (SLAUGHTER).
  ANIMALS (SLAUGHTER).
  AVIATION (FATAL ACCIDENTS).
  AVIATION (FATAL ACCIDENTS).
  ROYAL AIR FORCE (FATAL ACCIDENTS).
  ROYAL AIR FORCE (FATAL ACCIDENTS).
  RICHMOND PARK GOLF COURSE.
  RICHMOND PARK GOLF COURSE.
  ROTTEN ROW (RIDING, CHARGE).
  ROTTEN ROW (RIDING, CHARGE).
  EXPORT CREDITS.
  EXPORT CREDITS.
  LAPSED ASSURANCE POLICIES.
  LAPSED ASSURANCE POLICIES.
  ALCOHOLIC LIQUORS (EXPENDITURE)
  ALCOHOLIC LIQUORS (EXPENDITURE)
  AFFORESTATION, LENNOX MOOR.
  AFFORESTATION, LENNOX MOOR.
  CONTRIBUTORY PENSIONS.
  CONTRIBUTORY PENSIONS.
  NATIONAL HEALTH INSURANCE.
  NATIONAL HEALTH INSURANCE.
HOUSING.
  INTERIM DEVELOPMENT ORDERS (APPEALS).
  INTERIM DEVELOPMENT ORDERS (APPEALS).
  TOWN PLANNING, BROMLEY.
  TOWN PLANNING, BROMLEY.
  SCOTLAND.
  SCOTLAND.
PUBLIC HEALTH.
  CANCER.
  CANCER.
  MENTAL CASES (TREATMENT).
  MENTAL CASES (TREATMENT).
UNEMPLOYMENT.
  CLIFF RESTORATION, PAIGNTON.
  CLIFF RESTORATION, PAIGNTON.
  PSITTACOSIS.
  PSITTACOSIS.
  DIPHTHERIA.
  DIPHTHERIA.
  CHATHAM, ROCHESTER AND GILLINGHAM.
  CHATHAM, ROCHESTER AND GILLINGHAM.
  REGENT'S PARK.
  REGENT'S PARK.
  SAFFRON WALDEN AND HALSTEAD.
  SAFFRON WALDEN AND HALSTEAD.
  ANCIENT RUINS (EXCAVATION).
  ANCIENT RUINS (EXCAVATION).
  ROAD REPAIRS.
  ROAD REPAIRS.
COAL INDUSTRY.
  COLLIERY WORKERS (HOLIDAYS).
  COLLIERY WORKERS (HOLIDAYS).
  FIFE AND CLACKHANNAN.
  FIFE AND CLACKHANNAN.
  ROYALTY RENTS, DURHAM.
  ROYALTY RENTS, DURHAM.
  HOUSE OF LORDS.
  HOUSE OF LORDS.
TRANSPORT.
  ROADS, WHITE LINES.
  ROADS, WHITE LINES.
  LONDON TRAFFIC SCHEME.
  LONDON TRAFFIC SCHEME.
  PROPOSED ROAD BRIDGES, TAY AND FORTH.
  PROPOSED ROAD BRIDGES, TAY AND FORTH.
  TRAMCARS (DANGER SIGN).
  TRAMCARS (DANGER SIGN).
  STATIONARY VEHICLES.
  STATIONARY VEHICLES.
  BRITISH MOTORISTS, FRANCE (REGULATIONS).
  BRITISH MOTORISTS, FRANCE (REGULATIONS).
  RAILWAY REBATES (POTATOES).
  RAILWAY REBATES (POTATOES).
  RELIABILITY TRIALS, SEVENOAKS.
  RELIABILITY TRIALS, SEVENOAKS.
INCOME TAX.
  RELIEF WORKS GRANTS.
  RELIEF WORKS GRANTS.
  COLLECTION, WEST HAM.
  COLLECTION, WEST HAM.
  RESIDENCE ABROAD.
  RESIDENCE ABROAD.
  IMPERIAL COMMUNICATIONS ADVISORY COMMITTEE.
  IMPERIAL COMMUNICATIONS ADVISORY COMMITTEE.
Preamble
The House met at a quarter before four of the clock, The LORD CHANCELLOR on the Woolsack.
CLACTON-ON-SEA PIER BILL. [H.L.]
Read 2a, and committed: The Committee to be proposed by the Committee of Selection.

BUSINESS OF THE HOUSE.
EARL BEAUCHAMP: My Lords, I desire to ask the noble and learned Lord the Leader of the House if he can give us any information with regard to business for the next day or two?
THE LORD PRESIDENT OF THE COUNCIL (LORD PARMOOR): My Lords, in reply to the noble Earl I may say I had a letter a short time ago, and I understand a communication has been received by the Clerk of Parliaments stating that it is not convenient for the noble Earl, Lord Birkenhead, to move to-morrow the Motion of which he has given Notice [regarding relations with the Soviet.]. Reasons which I quite understand make it difficult for him to be present. I understand that the noble Earl has asked that his Motion should be put down for February 20. I do not think that will affect the Paper for tomorrow in any other way, but I thought your Lordships ought to know that.
PONTARDAWE RURAL DISTRICT ELECTRICITY ORDER, 1929.
GREAT YARMOUTH ELECTRICITY (EXTENSION) ORDER, 1930.
HORNSEA AND SKIRLAUGH DISTRICT ELECTRICITY ORDER, 1929.
TORQUAY ELECTRICITY (EXTENSION, ETC.) ORDER, 1929.
THE PARLIAMENTARY SECRETARY OF THE MINISTRY OF TRANSPORT (LORD PONSONBY OF SHULBREDE): My Lords, I beg to move the Motion standing in my name on the Paper.
Moved, That the Special Orders as reported from the Special Orders Committee
536
on Thursday last be approved.—(Lord Ponsonby of Shulbrede.)
On Question, Motion agreed to.
CHORLEY GAS ORDER, 1929.
BARRY GAS ORDER, 1930.
SPALDING GAS ORDER, 1930.
KENDAL GAS ORDER, 1930.
LORD MARLEY: My Lords, I beg to move the Motion standing in my name.
Moved, That the Special Orders as reported from the Special Orders Committee on Thursday last, be approved.—(Lord Marley.)
On Question, Motion agreed to.

RAILWAY MANAGEMENT.
LORD MONKSWELL LORD MONKSWELL rose to ask His Majesty's Government whether, in their endeavours to deal with unemployment and improve the industrial efficiency of this country, they have considered a report which appeared in the Evening Standard of 28th December, 1929, in which it is stated that Sir Henry Thornton, President and Chairman of the Canadian National Railways, said that "the present British system of managing railways, in his opinion, caused inefficiency, insubordination and disloyalty, and that conditions among railways could not be much improved until this was altered"; to call attention to some of the obstacles which stand in the way of reform; and to move for Papers.
The noble Lord said: My Lords, at a time like the present when the very existence of this country appears to depend on our ability to increase production all matters bearing on this question are of vital importance, and not one is of greater importance than the efficiency of our transport system. In these circumstances, I am sure your Lordships will be interested in the very outspoken remarks of Sir Henry Thornton, which have lately been reported in the Evening Standard and elsewhere. He is reported as saying that:—
"the present British system of managing railways, in his opinion, caused inefficiency, insubordination and disloyalty, and that conditions among railways could not be much improved until this was altered."

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As your Lordships are aware, Sir Henry Thornton is one of the most prominent railwaymen in the world. He is President and Chairman of the Canadian National Railways and was formerly General Manager of the Great Eastern Railway so that he is well acquainted with conditions in this country. I may say at once that I am personally unacquainted with Sir Henry Thornton and have never had any communication with him. On the other hand, I have on various occasions ventured to put before your Lordships facts which have convinced me that the present system of managing railways is extremely defective. I am therefore naturally interested to find that so great an authority as Sir Henry Thornton seems to be of much the same opinion as I am and I hope the Government will let us have their views with regard to what he has said.
The defects from which the railways of this country suffer are, I think, well known to any one who has had the time and the inclination to study the question, but the railway managements are an extremely strongly entrenched vested interest. So far they have been able by a simple process of boycott to resist most of the attempts to infuse a new and better spirit into their administration. They are so absolutely assured that no one can bring any pressure worth speaking of to bear upon them that they simply ignore all attacks, no matter how detailed. Boycott is their only weapon, and indeed their last chance. Before proceeding further, I wish to make it plain that in saying what I shall have to say of British railway managements in their corporate capacity I am making no attack upon any individual. I am particularly anxious to make this clear, not only because I do not wish to pillory any individual, but because I regard the harrying of individuals as the most fruitful meant of wasting time and obscuring the issue. Unfortunately, when one has to make an attack on any sort of organisation, one may very easily be taken as attacking the man who is the nominal head of it or the man who has performed some action complained of. Though it is impossible to avoid alluding to individuals in this way, I wish to say at once that, whether I am speaking of persons in the railway service or of those outside it, I regard the system as entirely responsible and I attribute no incapacity
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or want of rectitude to the gentlemen whose identity may be apparent.
In many great organisations the machine, that is to say the system that has grown up through the years, is so rigid and so powerful that no individual can make headway against it. This is particularly the case with regard to monopolies, and a more complete monopoly than is constituted by the railways in this country I do not know. For generations they have been left free to devise agreements among themselves to restrict progress until they have so entangled themselves in the net they have laid that no real reform is possible unless it is imposed by some outside agency. Probably the whole of the railway service, with the exception of a few fossils, would welcome reasonable reform, but the system has struck its roots so deep that no reform from inside is possible. I do not suggest that the individuals composing the railway managements are worse than their colleagues outside the railway service—I do not imagine that there is any difference—and I do not suggest that reform need be accompanied by any considerable infusion of new blood. No doubt a certain number of persons who have been entirely atrophied by the system should in the public interest be removed, but that is a comparatively small matter. The real trouble is the system. Until the system is first of all laid bare and then suitably dealt with, no effective action is possible.
It is, therefore, in no censorious spirit towards individuals that I bring forward my Motion. I happen to be one of that small band of persons who have made a study of railway management, and I have already on various occasions ventured to set before your Lordships some of the matters in which reform is urgently needed. No serious attempt has been made by any one to refute either my facts or my conclusions. The whole matter has simply been boycotted in accordance with the invariable practice, the invariable policy, of the railway managements. "What cannot be answered can be suppressed." It is just this question of boycott that lies at the root of the whole matter, and it is obvious that the boycott must be extremely efficient and most carefully arranged and maintained for the managements to place im-

539
plicit trust in it as they do. I therefore propose shortly to examine the methods by which the boycott is enforced.
There are three more or less distinct sets of people who might give trouble to the railway management. They are the public, the shareholders and the Government. Steps must be taken to muzzle all three. For the public to take any effective action, that is to say for a strong public opinion to arise, it is necessary that the facts should be frequently and clearly stated. For all practical purposes there is one way and one way only in which that can be done, and that is through the newspapers. If the Press can be induced to refuse to publish more than occasional criticism's and odds and ends of complaints, then it is absolutely certain that no pressure will be exerted by public opinion. What do the managements do to secure the support of the Press? It is the simplest thing in the world. A high official of the North Eastern Railway has lately stated that, apart from other advertising expenditure, the North Eastern Railway pays almost £500 every day of the year for newspaper advertisements. This for the London and North Eastern Railway alone works out at £180,000 a year, paid direct into the pockets of the newspaper proprietors by officials who are in a position to stop payment at any moment they please. If the payments on the part of all the groups are on the same scale, the yearly amount paid to the newspapers in this country is £600,000.
In these circumstances, though the editors are usually glad to publish the facts, the advertising managers absolutely refuse to allow any attack upon the railway managements to be continued long enough to have any practical effect. Again I do not wish to pillory any one, but that there may be no doubt that the purpose of the payments is fulfilled I am ready to give His Majesty's Government in private particulars of cases within my own knowledge in which very important newspapers have suppressed matter displeasing to the railway managements. I have been myself asked for matter for publication which, when furnished, has simply been suppressed, obviously because the advertising manager of the newspaper in question was afraid that it would offend his clients. In this way the public is put out of action.
To render the shareholders impotent is an equally simple matter. The number of shareholders is very great; there are about 90,000 in the Southern Railway and twice that number in the London and North Eastern Railway. The immense majority are totally ignorant of railways and they have no sort of organisation. On account of the expense of communicating with so great a number of people and the large amount of explanation necessary, the task of organising the shareholders for the purpose of looking after their own interests is next door to an impossible one for any single person or unofficial group. The people whose plain duty it is to organise the shareholders are the managements. A confused mass of bewildered and ignorant shareholders, trying to exist in a world in which the railway servants and predatory politicians are organised to the last button of the last gaiter, is necessarily an easy prey. If the managements in their relations with their shareholders, had any sense of loyalty, the absence of which Sir Henry Thornton deplores, the first thing they would do would be to organise their shareholders. So far from doing this, they vastly prefer to deal with an unorganised and impotent rabble, whom they can and do treat with contempt, and they stick at nothing to defeat any effort on the part of their shareholders to obtain any voice in the management.
I happen to know a good deal about this, for some friends of mine recently tried to get proxies from the shareholders of one of the great groups. We found ourselves obstructed at every turn. To begin with, any person or committee that endeavours to secure any concerted action on the part of the railway shareholders has to pay the whole of the expenses thereby incurred, whereas the managements can use the companies' money (that is to say the shareholders' money) to any extent they feel inclined. On the occasion of which I speak, up-to-date lists of the shareholders were refused, all information with regard to the amounts of the shareholders' holdings—that is to say their voting power—was refused, and the management claimed and exercised the right to count proxies themselves and refused to allow the results to be checked. When it came to voting, the Chairman did everything he possibly could to get things settled by a show of

541
hands, obviously having no confidence in the figures with which his officials had supplied him. When eventually figures were forced from him, they were enormously in his favour. It is obviously contrary to reason to suppose that he would have done, as he did, everything in his power to avoid giving these figures if he had had confidence in their accuracy. The whole thing was a pure farce. The managements are so strongly entrenched that it is utterly impossible for the shareholders to obtain any voice in the management.
With regard to the muzzling of the Government, by far the most important period was when tie Railways Bill was prepared and passed into law in 1921. Then there was a real chance that something might be done to put the railways on a better footing and that the power of the official clique might be broken. The official clique were not caught napping. By hook or by crook they contrived to get, one of their own men appointed Minister of Transport and, so that there might be no mistake, they got others of their own men appointed to the posts of his principal assistants. At that time the whole of the higher official ranks of the Ministry of Transport were composed of an unbroken phalanx of railway officials; and they produced the Railways Act, under which this country has ever since been groaning. The Railways Act involved the abandonment of the interests of the shareholders and of the public in return for preposterously favourable conditions for the railway servants and the managements. The railway managements did a deal with the Government. In return for the consolidation of their dominant position, they agreed to bleed the shareholders aid the public so as to continue to pay to the railway servants rates of wages that had foolishly been granted them at a moment when one of the most unjustifiable strikes that had ever taken place, the railway strike of 1919, was breaking down.
I do not suppose that, of all the troubles that have afflicted this country since the War, there has been a worse one than this settlement—a permanent bleeding of industry so as to pay to the members of certain powerful trade unions wages that in the circumstances were absurd. I say "in the circumstances." I am all for paying men the highest wages they can earn and I think that, if the
542
railways were properly organised and satisfactorily run, it might be economically justifiable to pay them what they now receive. But in the actual circumstances of the case the whole country is bled to pay wages which the men receive but are not allowed to earn. In return for this surrender of the interests of the country, the managements were allowed to dictate terms for themselves. They were allowed to hand on to their customers any increase in charges which this surrender made necessary.
The only pretence of safeguarding the public was a vague condition that the right to impose these increased charges should be subject to "efficient and economical working and management" in the opinion of the Railway Rates Tribunal. As no attempt was made to define efficient and economical working and management and no procedure was laid down, the whole thing was an insult to the intelligence. The pretended safeguard meant absolutely nothing, but it is the only sentence in the Act in which the efficiency of railway management is even distantly alluded to. On this one supreme occasion, when there was a real opportunity for imposing reasonable reform, the managements triumphantly hoodwinked the Government in the same way as they hoodwink the public and the shareholders.
But though, at this disastrous juncture, the Government of the day hopelessly failed to safeguard the national interests, it is, for the reasons I have given, the Government alone that is in a sufficiently powerful position to act with effect. Such pressure as has in the past been exercised upon the railways has usually been due to the Government. It was the Government that enforced the adoption of safety appliances, such as block signals and continuous brakes, and there is nothing at all at the present moment to prevent the Government from proceeding at an accelerated pace down the path of coercion that they have never entirely abandoned. Even quite lately they have done something to overtake the neglect into which the railways have fallen. It was the Government that appointed the Bridge Stress Committee and published their findings. It may come as a shock to some of your Lordships to learn that a number of locomotives in use in this country are balanced in such a way that

543
each driving wheel is, at high speeds, lifted clean off the rail once in every revolution. The Committee have thoroughly investigated this matter and have informed the railway companies that all new engines must be more satisfactorily balanced. That is in the Report. To set your Lordships' minds at ease, I may add that it is perfectly possible entirely to eliminate defective balance.
That is just a single example of what ought to be done to improve the efficiency of British railways. There are, of course, quantities of other things. I have on various previous occasions set forth a good many of them, and I should not have asked your Lordships to-day to listen to any further remarks on this subject if it had not been for the very strong line taken by the Government during the recent proceedings upon the Road Traffic Bill in insisting upon the independence of the questions of speed and dangerous driving. I am in complete agreement with the Government attitude on these questions, and I note that almost precisely the same considerations apply on the railways. Just as the enormous improvements in motors have been primarily due to constant tests of these vehicles at the highest possible speeds continued for long periods, so is the stagnation in railway development primarily due to the boycott of high speeds by the railways. As on the roads so on the railways, there is no test of material in any way comparable with the test of high speed. Motors are constantly being subjected to this test, and I need not point out the revolutionary improvements that have followed. On railways the boycott of high speeds has enabled the managements to neglect all kinds of desirable improvements leading to increased economy and safety.
Speed, in itself, no matter how high, is safe so long as the conditions are suitable. What must be avoided is dangerous driving. With suitable rolling stock running over a strongly-built main line there is for all practical purposes no limit to safe speed, and all points such as sharp curves where reductions of speed are necessary are well known and can, if it is thought desirable, be protected by automatic appliances. The way in which dangerous driving occurs on railways is almost entirely from unpunctuality. Safety appliances, though
544
pretty good, are not, and never are likely to be, perfect, and on crowded lines punctuality is the sheet anchor of safety. Directly a train is out of its proper place the chance of an accident is enormously increased. Some of the worst recent accidents have been due to this cause. Anything more farcical than the way in which the railway managements handle this question could not be imagined. They boycott high speed, but all, except the Great Western Railway, who I am glad to say have listened to me, actually encourage dangerous driving by refusing to issue any instructions to their drivers on the principal remedy for unpunctuality, the making up of lost time.
What I want to point out is that until the system under which the railway companies of this country are managed is broken up, no real reform is possible, and so great an authority as Sir Henry Thornton appears to be quite as much dissatisfied as I am. The public and shareholders are, for the reasons I have given, impotent. Government interference is the only chance of reform. I suggest that the Government should do what they have done before in the matter of enforcing the use of safety appliances and the proper designing of locomotives—that they should now and at any subsequent times when it may be desirable draw up a list of reforms, and should require the railways, if necessary by Act of Parliament, as they have done before, to carry them out within a specified time. In conclusion, I hope we shall not be told that a Royal Commission on Transport is sitting, and that nothing can be done before their final Report is received. I have been a witness before that Commission, and I know that most of the things which I have mentioned have not been before them at all, so it is extremely unlikely that they will express any opinion about them. I beg to move.
LORD NEWTON: My Lords, those who have sat in this House for some time must by now be familiar with the annual entertainment provided by the noble Lord on the Cross Benches at the expense of the railway companies, and I confess that, to a certain extent, I feel in sympathy with him, because up to now, so far as my memory goes, he has never succeeded in extracting anything from any Government except an expression of

545
thanks for the valuable debate which he has initiated. That is a barren form of compliment with which many of us are familiar and which becomes less acceptable as time goes on. Year by year the noble Lord surveys the railway horizon and invariably finds it vile. I might say that he finds it viler every year. I gather from him that he is firmly convinced that Governments, Ministers of Transport, directors, managers and shareholders of the railway companies, and the Press—no doubt instigated by the malign influence of the railway companies—are banded together to prevent the British public enjoying the facilities which they should enjoy with regard to transport; and in fact that everything is done to dissuade the British public from travelling at all.
Not only that, but everybody appears to be deaf to his warnings and exhortations. I gather that the railway boards do not desire his co-operation, that the Commissions and inquiries do not respond readily to the suggestions which he occasionally makes to them, and which no doubt are admirable in themselves, and that an unappreciative Press, with one notable exception, usually refrains from publishing his contributions. On the whole I think that in that respect he is certainly deserving of sympathy. Hitherto the noble Lord has waged a gallant but unequal fight against all these combined bodies and authorities, and I do not think he has obtained any support hitherto unless, if I may term it so, the crusading Press, in endeavouring to resuscitate the British Empire by introducing a larger form of railway truck, is an exception. Now the noble Lord is able to present some tangible evidence of support in the person of Sir Henry Thornton. He is a gentleman of high reputation, an American by birth, I believe, but now a British subject, and he was brought over here by the late Lord Claude Hamilton, I think, in 1914. He remained with the Great Eastern Company until 1922. It is obvious that he had not a very prolonged experience of British railways under their ordinary conditions.
The speech to which reference has been made, and in which the opinions that have been quoted were delivered, was made in this country last December, and I cannot help thinking that it conveys in some respects a very wrong impression.
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I refuse to believe that a person of Sir Henry Thornton's reputation would have consented to continue his duties if the state of things were really as bad as might be inferred from the remarks which he made. I have had an opportunity of reading that speech. It was delivered on a festive occasion and, as was appropriate, the greater part of it consisted of high compliments to this country generally and to the management of English railways. The expressions quoted by the noble Lord, that "the present system of managing British railways, in his opinion, caused inefficiency, insubordination and disloyalty" refer only to one particular practice which he deprecated—namely, that panels of directors interfered with the technical management. I absolutely refuse to believe that anything of the kind goes on at all. I do not believe that any railway director who is here present would admit that statement for a single instant. My opinion of railway directors is not particularly exalted. It is a better one than that of the noble Lord on the Cross Benches, but I entirely decline to believe that railway directors, who know nothing whatever about the technical details of the business, interfere with the work of experts. I should say that if they are like the ordinary human individual they are only too glad to leave details of that kind to the people who are competent to deal with them, and that they confine themselves—as I believe is the case—merely to questions of general policy.
In any case, I do not think that the noble Lord on the Cross Benches could really claim Sir Henry Thornton as a genuine ally. One of the numerous grievances of the noble Lord, if I have understood him correctly, is that the ordinary railway director is an incompetent dummy, who never opens his mouth at all, and takes no part in the management. Sir Henry Thornton's ideal of a director is a man who is continually silent, and who takes no part at all in the transaction of business. These two views are obviously totally incompatible. But for my part, without wishing to be disrespectful to Sir Henry Thornton, I fail to see why he should be regarded as a sort of infallible authority. His experience over here was not a very long one, and I have reason to believe that he was not looked upon as a brilliant or conspicuous success. Nor do I believe

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that he is considered a brilliant and conspicuous success even in his own country. If I am not mistaken, the ordinary shares of the companies which he controls pay no dividends at all, and though the noble Lord no doubt has a great admiration for Canadian methods of railway management, his trains do not for a moment approach in rapidity the rate of the railways over here. I believe that Sir Henry Thornton's show train is only able to boast a record of something like 43 miles per hour, as compared to the English rates which I will deal with presently. It is only charitable to assume that Sir Henry Thornton, who left this country some eight years ago, has not familiarised himself with the present conditions, and that upon this occasion he expressed views on a subject with which he was not thoroughly acquainted.
To return for a moment to the noble Lord on the Cross Benches, I think I may say without fear of contradiction that any person who was not in the habit of frequenting this place, and who came here, as new arrivals, for instance, come, and listened to the noble Lord, would certainly conceive the idea that of all countries in Europe this was the one that was worst served by its railways. I do not think I am of an insular frame of mind at all. I have travelled by rail, I think, in every country in Europe, Soviet Russia included, and I have not the smallest hesitation in asserting, without professing to be an expert, that the railway traveller and the railway public generally are much better treated in this country than in any other European country. I have looked up some of the noble Lord's speeches in the past, and the grievance which is always rankling in his mind is that the railways in this country do not run fast enough. I think I am correct in saying that every big town in this country has a London service once a day which approximates a rate of between fifty and sixty miles per hour, including stops. But that is not nearly enough for the noble Lord.
I observe that in an interview which he accorded to a newspaper the other day, he expressed the opinion that railway trains ought to travel as fast as aeroplanes; in other words, that railway trains ought to travel at between 200 and 300 miles per hour. Who wants to do that? The noble Lord may want to
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do it himself, but I can hardly think that he would find many persons of the same frame of mind; and I should have thought that, if anybody did want to travel at that sort of pace, it would be very much simpler to travel by air. Even the risk, not to speak of the discomfort, would certainly be less in the circumstances. Not only are the express trains in this country faster on an average than those in any other European country, but they are infinitely more comfortable, and they are infinitely safer. Incidentally, I may say that I personally long ago abandoned the practice of undressing in a French train, because it almost invariably happened to me that I was turned out in the small hours of the morning in consequence of an accident of some kind or other.
Let me recapitulate the advantages which we enjoy in this country over other European countries. In this country—and I do not think even the noble Lord will contradict me—we enjoy greater safety, greater speed, greater attention, and greater honesty, apart from other advantages. In this country, if you wish to engage a seat in a train you can do so, and you can obtain it. In other countries it is highly probable that you may have to pay blackmail to a hotel porter, or hairdresser, or someone of that kind; and even then you may find yourself defrauded in the end. In this country, if you send goods or property by train, it is long odds that you do receive them safely, or, at all events, only an infinitesimal part may occasionally be missing. But that is not the case in other countries which I will not mention. You are extremely lucky there if you ever receive your property at all. And finally, if you are unfortunate enough either to lose your property or to suffer an accident in your own person, you will be certain to receive fair compensation.
These are not inconsiderable advantages, and I think that they are appreciated by the vast majority of the public. And upon the whole, considering the enormous difficulties which the British railways have to face, in various forms which I will not enumerate at the present moment, I think that we may consider ourselves distinctly fortunate in possessing the advantages which we do. In conclusion I would venture to mention a very trivial experience of my

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own which confirms me in the opinions which I have expressed. During the General Strike, strange though it may sound, I acted as a stationmaster myself, and I may say quite honestly that I do not think anybody here present was more unfitted for that position than I was; and yet, in spite of these facts, no accident of any sort occurred on the railway whilst I was nominally in charge of that station. That is only a small instance, but it has confirmed me in the good opinion I have always held as to railway efficiency in this country.
LORD BANBURY OF SOUTHAM: My Lords, I am not now in any way connected with a railway but I was for twenty years a director of the Great Northern Railway and for the last six years of that period I was Chairman, so that I have had some experience of the management of English railways. I read the speech of Sir Henry Thornton with considerable interest. But I observed that the noble Lord, Lord Monkswell, having stated that Sir Henry Thornton had decried the methods under which English railways were managed, left Sir Henry Thornton's speech altogether. He did not inform your Lordships what were the actual mistakes to which Sir Henry objected, but devoted himself, as far as I could make out, to a long attack generally upon the officials and the directors of the English railways. One point he made, as I understood it, was that the London and North Eastern Railway, of which a noble friend behind me is now a director, spent something like £180,000 a year on advertisements; I think that was the figure. I am informed by the authorities of the Great Western Railway, which is a very large railway, that their annual expenditure on advertising is £12,000 a year. Therefore, I am rather inclined to think that the noble Lord must have made some little error and probably added a nought or two when he talked about £180,000 a year.
What was it that Sir Henry Thornton said? Sir Henry Thornton objected to the management of the English railways because he said that there were sub-committees of the board, each of which had a chairman, which looked after certain departments of a railway. That is true; at least it is true with regard to the Great Northern Railway. When I
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was a director of that railway there were four or five sub-committees of the board. There was the locomotive committee, consisting as far as I remember of four or five directors and a chairman; there was the way and works committee, and there were the hotels committee, the traffic committee and the horse committee. Each of those committees consisted of four or five members of the board with a chairman, and the Chairman of the board was ex-officio a member of all of them. Naturally, those committees, especially the chairmen of them, saw a good deal of and were in consultation with the official who was responsible for the work of the department concerned. Taking for instance the locomotive committee, the locomotive engineer, no doubt, was constantly in touch with that committee and with its chairman. The same was true of the other committees.
What Sir Henry Thornton said was that as a result the locomotive engineer thinks more of the chairman of the locomotive committee than he thinks of the General Manager. The result of that is that there is disloyalty and so on as stated in the Motion, and the General Manager is put in a difficult position. Sir Henry Thornton is in America, and there is or there was—I do not know so much about American railways now—a great deal of difference between the management of American railways and the management of English railways. I was Chairman of the committee which successfully rearranged the Central Pacific Railway of America and I have some knowledge, therefore, of American railway methods. In America—and this I think was the object of Sir Henry Thornton's remarks—the board of directors, at any rate at the time I knew them, was a nominal body. They knew nothing and they did nothing. They were figure-heads. The whole management of the railway was in the hands of the President, and the President resembled the Chairman and the General Manager of an English railway rolled into one. He had supreme command and did everything. That is very different from the practice in England where the directors, the Chairman especially, take an active part in the management of the company, not in the details of the actual working of the company—they do not go into a signal box and direct the signal-men how to pull the

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levers—but they have a general supervision over the general policy of the company.
In my opinion that is a better way of managing a railway than the American way, and for this reason. First of all, there are the directors who are, I think I may say, and always have been, men of position, who do not become railway directors to make a living out of it but because they are interested in the railway and desire to do what they regard as a public duty. They are mostly business men who have had some business experience and are capable of dealing with general principles, with finance and questions as to whether or no there should be an extension, what amount should be spent on dividend and what amount on the fares, etc., during the year, without interfering with the actual management of the railway. Sir Henry Thornton does not like that. He wants the General Manager to be supreme and that, no doubt, would be followed by the appointment of a President as in America.
I think I am correct in saying that the breath of scandal has never touched the railway directors of this country. It has never been said that they have used their position, in the vulgar phrase, to feather their own nests. Is that always true of America? Let me point out what at any rate thirty or forty years ago was supposed to be a not uncommon practice in America, by which a railway President, who had everything in his own hands, was enabled to make a considerable sum of money. We will say fur the sake of argument that a railway is paying 6 per cent. on its ordinary shares. It must be remembered that in America railway shares pass from hand to hand. They are not registered as in England. You do not have to make a transfer of them; so that it is very difficult, if not impossible, to know whether the President of the railway is a large shareholder, a small shareholder, or not a shareholder at all. As I say, the railway is paying 6 per cent. on its ordinary shares. The President increases that to 8 per cent. In order to do that he does not spend any money, or spends an insufficient amount of money, on the maintenance of the property, on renewals of locomotives and carriages, on the maintenance of the permanent
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way and so on; consequently, the railway itself gets into a rather depreciated condition.
That goes on for some little time. The public seeing that the shares are paying 8 per cent. buy a considerable number of them. The President, who bought some himself or whose friends bought before he raised the dividend from 6 to 8 per cent. sells when the shares have got pretty high, and rumour has it that he sells what they used to call "short"; that is to say, he sells a little more than he has got. He then pays no dividend at all and says that the profits have to go into the railway, that the railway really must have some locomotives, that the permanent way must be put into better order and so on. Consequently, the shares go down to very little. This goes on for three or four years. The public do not in the least know who the directors are. The directors are merely nominated, and they do not know what is going on. The public do not know what is going on. They get no dividend and they sell their shares. In the meantime the railway is being put into excellent condition by the net earnings being spent on it—what they call in America "betterment." The President then buys a large number of shares at a low price, takes advantage of what has come about from the net earnings being spent in betterment, and in subsequent years pays dividends. The result is he has done very well for himself.
I was at one time Chairman of the Mexican National Railway, and I could have done the same thing if I had wanted to—that is always provided the board of directors here would have allowed me. Therefore, I had some interest in knowing what was done in America in those ways. We must remember that Sir Henry Thornton s idea is that these committees interfere with the power of the manager, because that is what he objected to, and that is what the noble Lord has left entirely on one side. If his idea were carried out here, and the directors became merely nominees and the General Manager became President and controlled the whole railway, what is to prevent something of that sort happening here? You must, of course, in a General Manager, have a professional man, because he must know all about the working of a railway. But do you want to

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put the management of the railways entirely into the hands of professional men who go there, in order to make a living out of them? Is it not far better that the management should remain as it is at present, when we have professional men but they are subject to the board of directors, against whom, as far as I know, there has never been a breath of scandal raised in any kind of way. It has never been suggested against them that they have used their position, not to encourage and maintain the interest of the railways and the shareholders, but to feather their own nests. Sir Henry Thornton, as an American, prefers his own way, but I do not think it would suit this country.
Perhaps what I say may have a little more weight with the noble Lord who raised this question if I tell him I was strongly opposed to the amalgamation of the railways, and moved the rejection of the Bill in the House of Commons on Second Reading. At that time I was Chairman of the Great Northern board, and I did all I could, backed up by others, to stop amalgamation of the railways. I thought it was a mistake and said so at the time. Perhaps, therefore, the noble Lord would look upon me a little more favourably, as I understand he does not approve of the amalgamation of the railways.
There is one other matter that I should like to deal with for a moment. I understood the noble Lord to say that the railways had put one of their own people upon the Ministry of Transport. I presume he was alluding to Sir Eric Geddes—I do not know, but I presume so. But the railway companies did not put Sir Eric Geddes there. I should have said that a. good many of the railway companies did not want Sir Eric Geddes there, and would have much rather he had not been there. They certainly did not put him there. I do not know where the noble Lord got that impression from. As a matter of fact, as far as I remember, the London and North Eastern Railway paid Sir Eric Geddes £50,000 to go, which does not look as if they were very keen about having him in any other position. I do not know what views the Government will have, but of this I can be quite certain, that nothing could be more fatal to the railways than Government interference. During the years of the War
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the Government did interfere with the railways with very disastrous results.
LORD PONSONBY OF SHULBREDE: My Lords, I have had the pleasure to-day of hearing for the first time the noble Lord who put this Motion down on the Paper. I understand your Lordships have heard him on this subject before, but so as not to be handicapped in any way for this debate I have read through all his speeches, and also his evidence before the Royal Commission on Transport. I have emerged from my studies rather confused, but I quite recognise that the noble Lord is a great student of this question and has had very great experience. My memory goes back to about thirty years ago when the noble Lord and I were both clerks in the Foreign Office. I think he was just coming in, and I was just going out, and rumour declared in those days that his chief devotion and his great interest was rather for the locomotives on the metals than for the more complex and perhaps less satisfactory machinery of diplomacy, but in any case rumour was correct, for the noble Lord has pursued his studies since then with such ardour as to be the author, I understand, of a series of debates in your Lordships' House.
I would respectfully say that I rather deprecate the form in which this Motion on the Paper is placed. To advertise and give such great publicity to an extract from an evening paper in which one sentence is torn from a speech, and that a sentence which makes very grave charges against the British railways, seems to me rather an unfortunate way of raising the subject in this House. I am not here, of course, to defend the railway managements or the railway companies. On the other hand, I have neither the inclination nor would it be my duty in any way to join in such strong criticism against them. My experience as an individual, and I have travelled in a good many countries, including the United States, is such that, although in other countries one may see here and there details which might be copied, on the whole I prefer travelling in my own country to any other, and, therefore, when one sees such very grave charges, one has a sort of misgiving that there is some mystery behind it all.
In studying the noble Lord's speeches I find it very difficult to know what it is

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he is attacking; his line of attack is so extremely broad that one does not detach the particular point upon which he wants to concentrate. Sometimes it seems to me to be the Managers, then there is that class which is roughly called the officials, then there are the shareholders, then the engine drivers and the employees, and lastly there is the Government. The noble Lord jumps from one to the other, and it is very difficult to ascertain what exactly it is that he complains of. The noble Lord who has just preceded me, who speaks with very great authority on railway management, has replied to the noble Lord, Lord Monkswell, on the question of the management of railways, and it certainly is not the business of His Majesty's Government to go into that question at all. As to whether they suppress criticisms by a sort of bribe by advertisement or not I do not know. Why should they? It is unlikely, it seems to me. I notice from time to time in the newspapers that complaints about travelling are aired like complaints on any other subject.
Now as regards the control by shareholders. There again I find the matter rather difficult. The noble Lord in some of his utterances seems to want to have greater control by the shareholders, but in the interview which he gave to the Evening Standard—the noble Lord will see how carefully I have followed all his sayings on this question—he said that shareholders do not know one end of an engine from another, so I do not see that their further control of the railways would be very advantageous. My business is to reply to his criticism so far as the Government are concerned. I am not going back to 1921. His Majesty's present Government are not responsible for what happened then, nor for the advent of Sir Eric Geddes and the various railway officials who accompanied him. That is past history and I think the noble Lord has told us about it on several previous occasions. But I would assure him that in so far as there is any Government control it is exercised judiciously, and there are occasions on which improvements can be suggested and advice can be given.
Not only is the Royal Commission on Transport sitting, before which the noble Lord himself has given evidence, but there is the Automatic Train Control Committee, appointed by the last Government,
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which has been sitting for the last two years and is about to issue its Report. That Committee has been examining appliances and inventions and is going to make practical suggestions within a very short time. Then the present Government have set up a Committee to examine the question of main line electrification, and the Standing Committee on Mineral Transport has under consideration at this present time the question of increasing the capacity of wagons used for coal traffic to twenty tons. In addition to that, in connection with the schemes which the Lord Privy Seal has been drawing up, some of the railway companies have come forward with projects for further development, and they will accordingly get financial support from the Exchequer for those schemes. Therefore touch is kept not only by the Railway Rates Tribunal but by these various Committees between the Government and the railways.
But I think it should be recognised that the railways have gone through a very serious time since the War. The advent of the very keen competition of motor traction has undoubtedly made a very serious difference to the railways. If they were on the down grade, perhaps we might listen to the noble Lord who introduced this Motion with greater attention and feel that some great move ought to be made; but I think it may interest your Lordships if I give a very few figures to show that there is not any cause for grave apprehension so far as the railways themselves are concerned. The falling off in the number of passengers has been checked, but at the same time the receipts from passengers have dropped. This is due to the fact that there has been a very great increase in cheap tickets. Two-thirds of the passengers carried in 1929 travelled at specially reduced fares. In 1929 for the first time the receipts from specially reduced fares exceeded those from ordinary fares. An indication of activity on the part of the railway companies is that the number of passenger train miles run by the railways in 1929 exceeded those of previous years. Perhaps I may be allowed to give the figures because they are of some significance. The number of train miles on all railways during the year 1929 was 427,000,000 odd whereas the previous highest figure in 1928 was 416,000,000.

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That at any rate shows an endeavour on the part of the railways to do all they can not only to serve the public interest but to see if the keen competition of motor traffic can be met.
The noble Lord always brings out in his speeches the question of speed. Well, I do not pretend to be an expert on that question, but I have a friend who is an engine driver as well as a Member of Parliament and I have very closely questioned him on this point of speed. I have also other sources from which I can get some sort of information. I can assure the noble Lord that he is labouring under a misapprehension if he thinks that in a very short space of time British railway express trains can be made to run at from 80 to 100 miles per hour on the average. There would have to be many adjustments with regard to rails, with regard to bridges, with regard to the capacity of engines and the weight of trains, and even if all that were done—this is a point which seems to be frequently forgotter—the layout of the railway lines in this country is very different from that in any other country. Not only are we a very small country, but we are very highly industrialised, and every twenty or thirty miles you have sidings where freight trains and merchandise and minerals obstruct the way. Even if it were desirable, I do not think it would be practicable and I hope that in his future speeches the noble Lord will drop that part of his programme. I myself believe that this mania for speed by which humanity is seized at the present moment will pass away. I dare say it may not pass away in our generation, but it will in a generation or two, because I am perfectly convinced that humanity will soon recognise that being projected from one part of the country to another, or from one part of a town to another, in a very short space of time is injuring our nerves and preventing our capacity for accomplishment.
Another point which the noble Lord has raised is a technical point, that of making up time. He is convinced that it should not be left to the discretion of engine-drivers to make up time, but that there should be regulations issued by the management telling engine-drivers that time must be made up between various points.
LORD MONKSWELL: Subject to all proper speed restrictions, of course.
LORD PONSONBY OF SHULBREDE: Subject to all proper speed restrictions. Well, my information is that if there were any regulations to that effect they could not be carried out, that suddenly making a locomotive go at a greatly increased speed, feeding the engine with additional coal very rapidly, would not only mean great extra cost but might produce a sediment of clinker in the fire box that would very likely prevent the engine from going at the pace at which it was going. I see that the noble Lord laughs at what he thinks is my very inexpert way of treating this matter.
LORD MONKSWELL: The noble Lord must forgive me, but after all I have been studying the question all my life.
LORD PONSONBY OF SHULBREDE: I quite recognise that the noble Lord has been studying the question all his life, but my information comes from a man who has been driving an express train most of his life.
LORD MONKSWELL: But does he know anything about the designing of an engine?
LORD PONSONBY OF SHULBREDE: I should think probably he did.
LORD MONKSWELL: Is he just an engine-driver?
LORD PONSONBY OF SHULBREDE: He is an engine-driver.
LORD MONKSWELL: We might leave it at that, I should think.
LORD PONSONBY OF SHULBREDE: I will not enter into controversy with the noble Lord, because I am sure that, with his expert knowledge, he would defeat me. But I think he is waging a battle quite alone when he says that British express trains should be driven at an average of 80 or 90 miles an hour. I should not have embarked upon this had it not been so frequently referred to in the noble Lord's speeches. His real charge, which I am here to answer, or rather his chief charge against the management of British railways is that the organisation is wrong and that no reform from inside, as he said just now, is possible.
Perhaps there may be arguments to be brought against the present form of man-

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agement. I am very reluctant to embark on the great principle which really underlies this debate, but perhaps I may be allowed to say a passing word on the subject. I think that undoubtedly, as time goes on, it will be proved that a great national service of this character should be under public control. I think that will be recognised in time to come. I speak of public control, not meaning bureaucrats, officials, Members of Parliament, Ministers and Governments, but in the sense in which my hon. friend the Minister of Transport put it the other day in another place when he said that it should be made accountable to the nation, but that the day-to-day management of the undertaking should be left in the hands of a limited number of first-class business men, employed by the community and encouraged to run the concern with all the vigour of a commercial and business enterprise. I think that we shall possibly find, in a shorter time than some imagine, that this will be the proper way to manage the great railway services of this country. When that step is taken and when the proposals are made in your Lordships House from this Box, I hope that the noble Lord who moved this Motion will feel that his efforts have not been in vain and that his great ambition has been achieved, and I hope that he will give us his very hearty support.
LORD MONKSWELL: My Lords, I do not want to keep your Lordships. If I began talking I should go on talking all night, so I shall be as quick as I can. With regard to Sir Henry Thornton, I never made the slightest pretence that I was in communication with him or knew anything about his speech except what I read in the Evening Standard. I put it in my Motion that the words of Sir Henry Thornton to which I wished to draw attention were quoted from the Evening Standard and I simply left it at that, but if the Evening Standard have got them wrong I am sorry. I must leave it to the Evening Standard to fight it out with Sir Henry Thornton. I simply wished to draw your Lordships' attention to these words, which, on the face of them, expressed extremely strong dissatisfaction with the present management of British railways. Beyond that I know nothing. They were certainly very largely in accordance with a great number of things which I have myself
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noticed and have previously ventured to put before your Lordships' House.
It is rather difficult to know how to treat the Government in this matter. The noble Lord gets up and says that my views are so immensely wide that it is impossible to deal with them. The fact of the matter is that there is a great deal that is wrong, and it is not very much use drawing attention to small particulars. I cannot ask your Lordships to come here and listen to a debate on one particular subject. The fact of the matter is that the railways made an exceedingly good start. From about 1825 to 1850 they went ahead, just as the motor industry has been going ahead up to the present time. About 1850 stagnation settled down. The railways found that they were so immensely superior to every other means of transport that they could put their heads together and say to one another: "We will do as nearly as possible nothing for ever and ever." That is what has been going on. I have several times said that what it really means is that, in the last eighty years, from 1850 onwards, the progress effected by the railways is perhaps reasonably sufficient for thirty years. That leaves about fifty years' progress that simply has not been made at all.
I am sorry that the Government completely refuse to listen to what I say. I am perfectly ready to talk with the noble Lord privately if he will listen to what I say, or I will do anything I can. The fact of the matter is that the thing is being boycotted. I have come here and have given your Lordships in the fullest possible detail all kinds of facts about the safety of trains and other matters, and I have expressed myself ready to do anything that I can. All that happens is that the representative of one Government after another gets up and says that they are not going to have anything to do with it. No doubt the noble Lord who replied to me to-day is at a disadvantage. He appears to have a friend who is an engine-driver. If he has one friend who is an engine-driver, I have probably fifty, and not only engine-drivers but a lot of engineers who do the actual designing of engines, a lot of inspectors, and all sorts of other people. I have read every technical book about the subject, and when I venture to speak about these things I know what I am talking about. I do not think I really need take seri-

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ously what the noble Lord said on the subject of speed, of making up time and that sort of thing. If I got into that subject it would take a very long time. I have done it before and I hardly feel that I can take up any more of your Lordships' time, so I will leave it at that.
There are one or two little points that I should like to touch upon. I noticed that the noble Viscount (Viscount Churchill) said "Hear, hear" when I said that I was going to stop. I should like to say one thing to him. It is a curious thing that he comes and listens to me time after time, but the only time that he got up and said something for himself was four or five years ago when I raised this subject. One of the questions that I raised was why railway companies did not provide third-class sleeping carriages. The only thing that the noble Viscount ever told your Lordships was that the railways could not provide third-class sleeping carriages because they cost too much. I think that was in 1925. In 1928 the Great Western Railway, in common with the other railways, introduced third-class sleeping carriages, the one thing the noble Viscount told us could not be done. I will not say anything more about that. Within three years third-class sleeping carriages were there.
Perhaps I might be allowed to remind the noble Viscount of what this railway has done, because, frankly, the Great Western Railway is streets ahead of any other railway. Their new train from Swindon is quite a good train. I do not think I shall be betraying any confidence if I say that I have practically been officially informed by the Great Western that in consequence of what I said they issued orders to their drivers to make up time, of course under the strictest possible measures of safety. That has been done, so really, to a very great extent, I am in accordance with the noble Viscount and I am very glad indeed that he has taken so many progressive steps.
With regard to the remarks of the noble Lord, Lord Banbury, I have the greatest
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possible regard for him. I believe in about nineteen cases out of twenty, in politics and everything else, we see practically eye to eye. I do not think I have anything to complain about with regard to what the noble Lord told us. He told us a great many interesting things about directors, but, although they were interesting, and we are grateful for the information, they had no real bearing upon what I said. I have reason to believe that in certain respects even in regard to railways Lord Banbury and I see eye to eye, and therefore I do not think that there is a great difference between us.
As to the remarks which fell from the noble Lord who answered on behalf of the Government, and from other noble Lords who have spoken, they really only amounted to skating round the question and did not touch upon the important points raised by myself. As to the question of £180,000 a year, which I stated was spent by the North Eastern Railway on advertisements, I got those figures from a report of a lecture printed in a paper called Modern Transport. It was a lecture delivered by the General Manager of the North Eastern Railway. As to the Great Western spending only £12,000 a year, I do not know anything about it. I merely calculated upon a proportional basis for other railways, but it was definitely stated in Modern Transport that the North Eastern Railway Company was paying £180,000 a year in newspaper advertisements, quite apart from the wonderful posters which we have seen. If desired I can give the reference. I beg leave to withdraw my Motion.
Motion, by leave, withdrawn.
PORTSMOUTH CORPORATION BILL. [H.L.]
SHOREHAM HARBOUR BILL. [H.L.]
FALMOUTH WATER BILL. [H.L.]
PORTSMOUTH WATER BILL. [H.L.]
Committed: The Committees to be proposed by the Committee of Selection.
House adjourned at twenty-five minutes past five o'clock.