Sitting of 6 March 1934

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

PRIVATE BUSINESS.
Private Bills (Standing Orders not previously inquired into complied with),
Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That in the case of the following Bills, referred on the Second Reading thereof, the Standing Orders not previously inquired into, which are applicable thereto, have been complied with, namely:
London Midland and Scottish Railway Bill.
Southern Railway Bill.
Bills committed.
Private Bills [Lords] (Standing Orders not previously inquired into complied with),
Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That in the case of the following Bill, originating in the Lords, and referred on the First Reading thereof, the Standing Orders not previously inquired into, which are applicable thereto, have been complied with, namely:
Somersham Rectory Bill [Lords].
Bill to be read a Second time.

ORAL ANSWERS TO QUESTIONS.
  TRADE AND COMMERCE.

    SHIPPING INDUSTRY.
    Lieut.-Colonel MOOREasked the President of the Board of Trade if he can give any details of the Government scheme for subsidising tramp shipping?
    Mr. CRAVEN-ELLISasked the President of the Board of Trade if he is yet in possession of the information required by him from the shipping indus-
    1626
    try to enable the Government to decide upon a policy which will free British shipping from the competition of foreign shipping subsidies?
    Mr. STOREYasked the President of the Board of Trade if he has considered the joint recommendations of the Chamber of Shipping and the Liverpool Steamship Owners' Association; and if he can now state what steps he proposes to take to assist British shipping to meet uneconomic competition?
    The PRESIDENT of the BOARD of TRADE (Mr. Runciman): The position of British shipping is under the consideration of the Government in consultation with the shipping industry and I cannot at present add to the replies I have already made on the subject.
    Lieut.-Colonel MOORE: Would the right hon. Gentleman say if there is no truth in the statement which has been made in the Press that £3,000,000 has been granted by the Government to the shipping industry?
    Mr. RUNCIMAN: No, Sir, nothing has been said.
    Mr. CRAVEN-ELLIS: Could the right hon. Gentleman give us any indication as to how long the shipping industry will have to wait before some view of the Government is given as to the position of the industry?
    Mr. RUNCIMAN: I am afraid my hon. Friend has got it the wrong way round. The shipping industry is not waiting on the Government; the Government are waiting for the last reply of the shipping industry to inquiries which have been made.
    Mr. HERBERT WILLIAMS: Will the right hon. Gentleman consider the use of coercive tariff measures before a subsidy?
    Mr. KIRKWOOD: Do the Government intend to subsidise tramp shipping?
    Mr. RUNCIMAN: I cannot announce any decision on that point.
    Mr. SPEAKER: The hon. Member has had the reply.

    TRADING AGREEMENTS.
    Lieut.-Colonel MOOREasked the President of the Board of Trade whether

    1627
    the Trading Agreements hitherto concluded, and conditionally imposing an increased purchase percentage of British goods, have been in every case fully carried out by the countries concerned?
    Mr. RUNCIMAN: Coal is the only article for the purchase of which from this country a definite percentage has been laid down in the Trade Agreements. On this matter I would refer my hon. and gallant Friend to the reply given on the 6th February to a question by the hon. Member for South Bradford (Mr. Holdsworth).

    MERCHANDISE MARKS ACT.
    Captain STRICKLANDasked the President of the Board of Trade what was the conclusion arrived at with regard to the reversal of the operation of the Merchandise Marks Act as a result of the further consideration given by him to this matter?
    Mr. RUNCIMAN: The question is still under consideration.
    Captain STRICKLAND: If I put down another question in a week's time, will the right hon. Gentleman be able to give me some reply?
    Mr. RUNCIMAN: I am afraid I cannot make any promise.

    FOREIGN SHIPPING (BRITISH WATERS).
    Mr. ALBERYasked the President of the Board of Trade (1) what, if any, are the regulations governing the use of British ports by foreign tugs operating in the neighbourhood of our coasts;
    (2) what, if any, are the regulations governing the salvage of foreign vessels within British territorial waters, with special reference to the employment of British or foreign tugs?
    Mr. RUNCIMAN: There is nothing in the United Kingdom law and regulations to prevent a foreign ship which is in difficulty off our coast from calling for the assistance of any salvage ship or tug, British or foreign; there are no regulations which restrict the operation of foreign salvage ships or tugs in our waters, provided that any provisions of the Aliens Order which may apply are observed.
    Mr. ALBERY: With reference to Question No. 5, may I ask whether there
    1628
    has been any consultation with the Home Office as to the question of foreign ships using British ports to obtain employment in British waters contrary to the "Aliens Order"; and, with regard to Question No. 6, whether the right hon. Gentleman is aware that in some foreign countries a different attitude has been taken up in dealing with this matter?
    Mr. RUNCIMAN: I am afraid that the attitude taken up by foreign countries with regard to operation in their waters is not one that we are necessarily prepared to follow. With regard to Question No. 5, the Home Office are responsible for the administration of the Aliens Order and I have no reason to believe that they are not watching the administration carefully.

    FRANCE (BRITISH COAL IMPORT QUOTA).
    Colonel ROPNERasked the President of the Board of Trade whether he can make any further statement with regard to the expressed intention of the French Government to impose a further cut on the British coal import quota?
    Mr. RUNCIMAN: I am informed that an announcement has been issued by the French Mines Department to the effect that the proposed cut of 10 per cent. in the quota for United Kingdom coal has been suspended in view of the negotiations between the two Governments which are in contemplation.

    AUSTRALIA (PRIMAGE DUTY).
    Mr. MALLALIEUasked the President of the Board of Trade whether he is aware that under the new Australia-New Zealand Trade Agreement goods from New Zealand entering Australia are exempt from the payment of primage duty, while competing British goods are subject to the duty; and whether, in view of the terms of the Ottawa agreements, he will say what action he proposes to take?
    Mr. RUNCIMAN: There is nothing in the Australia-New Zealand Trade Agreement which is contrary to the terms of the agreements concluded by this country with the two Dominions at Ottawa. The Commonwealth Government undertook at Ottawa to reduce or remove the primage duty on United Kingdom goods as soon as the finances of Australia would allow, and they have already taken a substantial step in this direction.

    AUCTIONEERS' LICENCES.
    Mr. HALL-CAINEasked the Secretary of State for the Home Department whether he is aware that excise licences are granted to auctioneers without any inquiry; and whether he will consider establishing definite conditions to ensure the issue of such licences to suitable persons?
    The SECRETARY of STATE for the HOME DEPARTMENT (Sir John Gilmour): I am aware that there is no power under the existing law to refuse an actioneer's licence to any applicant who tenders the amount of the duty. It would require legislation to impose conditions on the issue of such licences and I have not sufficient evidence before me to indicate that legislation for this purpose is necessary or desirable.
    Mr. HALL-CAINE: Does not the right hon. Gentleman realise that the laxity in granting these licences leads to mock auctions which are defrauding the public, and will he not take some action?

    IRAQ.
    Captain CAZALETasked the Secretary to the Overseas Trade Department whether he will consider the appointment of a Commercial Attache to the Embassy at Bagdad in view of the increasing importance of the trade between the Kingdom of Iraq and Great Britain?
    Lieut.-Colonel J. COLVILLE (Secretary, Overseas Trade Department): As my hon. and gallant Friend will be aware from the answer to his question on the 28th February, it has been decided to transfer the present Commercial Secretary to His Majesty's Embassy at Bagdad to Haifa, as Commercial Agent in Palestine, as from the 1st April. Adequate arrangements will be made at Bagdad whereby commercial work in Iraq will be continued, but owing to financial exigencies it is not proposed to fill the post of Commercial Secretary at that Embassy.
    Captain CAZALET: Is the hon. and gallant Gentleman aware that the trade which was done between this country and Iraq last year was equal to the trade between this country and Persia and Turkey combined, and can he say whether it is the Treasury which is holding up this appointment?
    Lieut.-Colonel COLVILLE: I can only say, in answer to what my hon. and gallant Friend asks, that the commercial interests are not being lost sight of in this matter.
    Brigadier-General Sir HENRY CROFT: Would it not have been wiser for my hon. and gallant Friend to have asked his questions before we left Iraq rather than now?
    Lieut.-Colonel COLVILLE: Our interests will be represented in Iraq by the consular officer.

    DYEING AND CLEANING INDUSTRY (PETROL DUTY).
    Mr. DUNCANasked the Chancellor of the Exchequer (1) whether there would be any administrative difficulty if a rebate of tax were allowed in respect of the petrol used by the dyeing and cleaning industry;
    (2) the estimated loss to the Exchequer if a rebate of 100 per cent. were allowed in respect of the tax on petrol used in the dyeing and cleaning industry?
    The FINANCIAL SECRETARY to the TREASURY (Mr. Hore-Belisha): The administrative difficulty of guarding the revenue against the possible abuse of such a rebate as my hon. Friend suggests would be considerable. In any event it would be impossible to justify allowing it to the dyeing and cleaning industry and not to the numerous other industries that use petrol. I regret that official figures are not available to enable an estimate to be made of the cost of such a rebate.

    SUBSIDIES AND FINANCIAL ASSISTANCE.
    Mr. MAINWARINGasked the Financial Secretary to the Treasury if he will provide a return giving a complete list of all industries and/or processes separately receiving financial aids or subsidies, either directly from the Treasury or from one or other of the State Departments, together with the amount of the assistance thus granted in each case, separately, and for each of the last three years?
    Mr. HORE-BELISHA: With the hon. Member's permission I will circulate the answer, which is necessarily a statement in tabular form, in the OFFICIAL REPORT.
    Following is the answer:

    STATEMENT showing the Industries or Processes receiving financial aid or subsidy from the Exchequer and the approximate amounts so received in each of the financial years 1931–2, 1932–3 and 1933–4:

    Industry or Process.

    Financial Year.

    1931–2.

    1932–3.

    1933–4.

    Grants under Part I of the Development (Loan Guarantees and Grants) Act, 1929:

    £

    £

    £

    Railway Companies

    …

    159,000

    449,000

    429,000

    Dock Companies

    …

    500

    500

    500

    Canal Companies

    …

    1,000

    9,500

    17,000

    Gas Companies

    …

    41,000

    78,000

    44,500

    Water Companies

    …

    10,000

    18,500

    12,500

    Electricity Companies

    …

    6,000

    13,500

    29,500

    Light Horse Breeding

    …

    25,000

    10,500

    —

    Mechanical Transport

    …

    15,000

    4,500

    3,000

    Civil Aviation

    …

    395,000

    398,000

    402,000

    Slate Quarry

    …

    —

    9,000

    4,000

    Grants made by the Department of Scientific and Industrial Research to Research Organisations of the following Industries:

    Automobile Engineering

    …

    1,250

    2,500

    1,875

    Boot, Shoe and Allied Trades

    …

    1,070

    1,100

    1,200

    Cast Iron

    …

    3,960

    3,000

    3,000

    Cocoa, Chocolate, Sugar Confectionery and Jam Trades.

    …

    2,330

    1,400

    1,270

    Cotton

    …

    13,680

    10,000

    10,000

    Artificial Silk

    …

    1,990

    1,860

    1,870

    Cutlery

    …

    50

    30

    —

    Electrical and Allied Industries

    …

    15,620

    11,000

    7,300

    Flour Milling

    …

    1,620

    1,500

    1,000

    Food Manufacture

    …

    2,170

    475

    490

    Laundering

    …

    1,830

    1,680

    1,720

    Leather Manufacture

    …

    2,510

    2,200

    1,620

    Linen

    …

    3,060

    1,550

    800

    Non-Ferrous Metals

    …

    8,750

    5,760

    5,360

    Paint, Colour and Varnish Manufacture

    …

    4,200

    2,200

    1,200

    British Refractories

    …

    2,490

    1,200

    1,000

    Rubber Manufacture

    …

    1,530

    1,900

    1,100

    Scientific Instruments

    …

    7,950

    7,400

    7,000

    Silk

    …

    380

    300

    —

    Wool

    …

    6,750

    5,000

    5,500

    Iron and Steel Manufacture

    …

    4,030

    6,150

    4,200

    Colleries (Hydrogenation of Coal)

    …

    340

    —

    —

    Beet Sugar

    …

    2,135,000

    2,356,000

    3,350,000 (estimate)

    Field Drainage

    …

    25,000

    11,000

    4,000

    Agricultural Marketing Boards:

    Hops

    …

    —

    550*

    —

    Pigs

    …

    —

    —

    8,370

    Milk

    …

    —

    —

    22,250*

    Scottish Boards

    …

    —

    —

    1,330

    Loans to Co-operative Marketing Societies

    …

    3,000

    —

    —

    Flax Development

    …

    14,000

    1,000 (net receipt)

    600 (net receipt)

    * Since repaid.

    NEW AND EXTENDED FACTORIES.
    Mr. ROBINSONasked the President of the Board of Trade the total number of new factories set up in Great Britain during 1933; what extensions
    1632
    have been made to existing factories; what has been the total increase in employment as the result of these developments and extensions; and what has been the estimated increase in total wage payments?
    Mr. RUNCIMAN: A survey of factories opened, extended and closed during 1933 is in course of preparation and, it will I hope be completed by the end of April. The survey will contain information as to the amount of employment afforded by new factories but the information asked for in the last part of the question is not available.

    INDIAN RAW COTTON.
    Major PROCTERasked the President of the Board of Trade if he is now in a position to make any statement as to the proposals of His Majesty's Government to increase the use of Indian raw cotton in the textile industry in Lancashire?
    Mr. RUNCIMAN: As I have previously informed my hon. and gallant Friend, the consideration of proposals to promote the greater use of Indian cotton in this country was undertaken by the Lancashire-Indian Cotton Committee.
    Major PROCTER: May I ask when the Government will be able to report to the House as to what is being done, not what is being considered, in relation to this matter?
    Mr. HAMMERSLEY: Is it not the fact that already, as a result of the activities of this committee, there has been a considerable increase in purchases of Indian cotton by Lancashire, and that at the British Industries Fair there were many examples of cotton cloths made from Indian cotton on exhibit for sale? Is it not clear therefore, that Lancashire is taking a much greater interest in this matter?
    Mr. RUNCIMAN: I have no reason to be dissatisfied with the work which has been done by the Lancashire-Indian Cotton Committee, and I may inform my hon. Friend that a good deal of the decorations at the British Industries Fair was done through Indian raw cotton.

  BRITISH ARMY.

    TANKS.
    Brigadier-General NATIONasked the Financial Secretary to the War Office what is regarded as the normal life of a tank in the Army, and how many tanks eight years old and over still form part of the tank units of the Army at the present time?
    The FINANCIAL SECRETARY to the WAR OFFICE (Mr. Duff Cooper): I do not think that it would be in the public interest to publish this information.

    REMOUNTS.
    Mr. HALL-CAINEasked the Financial Secretary to the War Office what is the approximate number of remounts at present maintained by the British Army; and what proportion of these were bred elsewhere than in Great Britain and Northern Ireland?
    Mr. COOPER: As regards the first part of the question, I would refer my hon. Friend to the information given on page 15 of Army Estimates for the current year. I regret that the information asked for in the last part of the question is not available.
    Mr. HALL-CAINEasked the Financial Secretary to the War Office, what steps are taken by his Department to ascertain whether it would be possible to obtain the entire supply of Army remounts within Great Britain and Northern Ireland; and whether any changes have been made in this respect during the past two years with a view to ensuring that the maximum proportion of British horses is obtained for this purpose?
    Mr. COOPER: The policy of the Department is based on experience. We endeavour to encourage the farmer breeder both in Great Britain and Northern Ireland, but we keep in touch with the Irish Free State, Which provides a valuable auxiliary market. The only recent change in the position is a decision to re-introduce a Government subsidy in aid of light horse breeding.

  SCOTLAND.

    EDUCATIONAL ENDOWMENTS.
    Lieut.-Colonel MOOREasked the Secretary of State for Scotland whether his attention has been called to the objection in Scotland to schemes prepared by the Educational Endowments Commission, in view of the tendency of the schemes to set at nought the wishes of testators; and whether he will consider amending this Act in order to ensure that greater effect can be given to the wishes of local interests in adhering, as far as possible, to the original schemes of testators?
    The UNDER-SECRETARY of STATE for SCOTLAND (Mr. Skelton): I am aware that certain of the schemes prepared by the Endowments Commissioners have evoked criticism of the nature indicated. It must be borne in mind, however, that, before any scheme can come into operation, the approval of my right hon. Friend, as responsible for the Scottish Education Department, has to be given. With regard to the second part of the question, my right hon. Friend does not consider it to be necessary to amend the Act in the direction indicated. The present Act, based on the unanimous recommendations of the Committee presided over by Lord Mackenzie, enjoins that special regard should be paid to the spirit of the intention of the founders. Further, existing conditions, both social and educational, have to be kept in mind. These legislative directions appear to afford sufficient guide for the preparation and approval of schemes.
    Lieut.-Colonel MOORE: If my hon. Friend is not prepared to introduce legislation to amend the Act of 1928, what other method is there by which the Educational Endowments Commissioners can be curbed in their activities in preventing any testator from disposing of his money as he pleases?
    Mr. SKELTON: I have already informed my hon. and gallant Friend of the fact that schemes have to be approved by the Department before coming into operation, and there is further procedure to which I shall have to refer in answer to a subsequent question.

    WESTERN ISLES (AIR AMBULANCE SERVICE).
    Mr. KIRKWOODasked the Secretary of State for Scotland what progress has been made regarding the scheme for an air-ambulance service for the conveyance of patients in need of urgent treatment from the Western Isles to the Glasgow infirmaries?
    Mr. SKELTON: The Department of Health have come to an arrangement with the County Council of Argyll under which urgent cases nominated by the local medical officers (i.e., the patients' family doctors) will be conveyed to hospital by aeroplane. The charges for the hire of the aeroplane, so far as not met by patients, are shared by the County Council and the Department of Health. These arrangements will apply to any part of
    1636
    the county, island or mainland, where the service can be operated. The possibility of assisting a similar service elsewhere in the Highlands and Islands is being kept in view.

    HOUSING.
    Mr. KIRKWOODasked the Secretary of State for Scotland what action has been taken by the Stirlingshire County Council and the Department of Health to provide better housing accommodation for the inhabitants of Stand-burn, Stirlingshire, who lodged a petition under the 1930 Act against the failure of the Stirlingshire County Council to provide them with good houses?
    Mr. SKELTON: A public local inquiry into the housing conditions in Standburn was held on the 15th and 16th January, and the Commissioner inspected the houses on the 29th January. His report has now been submitted, and is under consideration.
    Mr. KIRKWOOD: Is not this Commission taking far too long to make its report, seeing that it is a month since it sat, and that that time it was horrified—the Chairman used that expression—at the conditions which prevailed?
    Mr. SKELTON: The Commissioner, as I have stated in my answer, has submitted his report, and that report is now under consideration. I may add that there will be no unnecessary delay at all in the matter.
    Major Sir ARCHIBALD SINCLAIRasked the Secretary of State for Scotland whether he has considered the communication from the Association of County Councils in Scotland expressing the view that private enterprise cannot under existing conditions provide houses in Scotland to be let to the working classes at reasonable rentals, and that the provisions of the Housing (Financial Provisions) Act, 1933, will not enable local authorities to supply the houses needed; and whether he intends to introduce proposals to amend the Act, or in any other way to encourage the erection of houses to be let at rentals within the means of low-paid wage-earners?
    Mr. SKELTON: The answer to the first part of the question is in the affirmative. With regard to the second, the Housing (Financial Provisions) (Scotland) Act, 1933, did not become law until the build-

    1637
    season for 1933 was well advanced, and while its effect in stimulating private enterprise has so far been slight, further experience, in my right hon. Friend's view, must be gained before it can be said that it will prove ineffective for that purpose, or that private builders cannot supply houses for the working classes at reasonable rents. The question of instituting further measures to abate overcrowding, for which subsidies are provided under the Act referred to, and under the Act of 1930, is at present receiving the attention of the Government.
    Sir A. SINCLAIR: When are we likely to have a decision on the point, in view of the urgent need of more houses for low-paid wage-earners?
    Mr. SKELTON: I cannot add to the statement that I have made.

    MARR COLLEGE, TROON.
    Mr. KIRKWOODasked the Secretary of State for Scotland if he is aware of the dissatisfaction in the country with the opposition of the Marr Trustees to the scheme of the Education Endowment Commissioners for the control of Marr College, Troon; and if the Scottish Education Office intend to take early action to have the college made available for public education?
    Mr. SKELTON: I am not aware that the Marr Trustees are offering objections to the amended scheme which has now been adjusted between the Commissioners and the Department. The scheme as thus adjusted was advertised on 16th February, 1934. The hon. Member will recollect that the Statute requires from that date a period of two months during which the Department will receive any objections to the scheme made to them in writing. If at the conclusion of that period the Department approves the scheme, the Statute requires a further period of two months before the scheme is submitted to His Majesty in Council for final approval. That period is to give objectors an opportunity of petitioning that the scheme should be laid before Parliament. The hon. Member will thus see that, owing to the elaborate procedure laid down by Parliament, the Department's powers to expedite the opening of the Marr College are strictly limited, but I can assure him that no action by the Department will in any way
    1638
    prolong the period which must elapse before that opening takes place.
    Lieut.-Colonel MOORE: Is my hon. Friend aware that this college has been empty for three years now; and will he bear in mind that if, in spite of the fact that the place has an endowment, four months more are to elapse before any action can be taken, for that period children will be kept out who, otherwise, might be taking advantage of this education?
    Mr. SKELTON: That is true, but I am afraid that I cannot alter the statutory procedure. It is rather rash of me to say so, but I think I am safe in saying that there is no particular reason to anticipate that there will be any extraneous cause of further delay.

    PLASTERERS' DISPUTE.
    Mr. BURNETTasked the Secretary of State for Scotland if he can give any information with regard to the plasterers' strike, and the effect which it is likely to have upon the provision of houses and the payment of subsidy?
    Mr. SKELTON: The first part of the question should be addressed to my right hon. Friend the Minister of Labour. As regards the second part, my hon. Friend will readily understand that the continuation of the strike would postpone the completion of houses not yet plastered. Subsidy becomes payable on completion of the houses.

    ILLEGAL TRAWLING AND SEINING.
    Mr. BURNETTasked the Secretary of State for Scotland if he will state the number of convictions for breach of the law committed along the East Coast of Scotland, respectively, for illegal trawling and for illegal seining during the last three years?
    The SECRETARY of STATE for SCOTLAND (Sir Godfrey Collins): In 1933 the number of convictions for illegal trawling was seven, for illegal seining nine. The corresponding figures for 1932 were three and ten, and in 1931 none and 17 respectively. These figures relate to the East Coast of Scotland, including the Moray Firth but excluding Orkney and Zetland.
    Mr. THOMAS RAMSAY: Is the right hon. Gentleman aware that the number

    1639
    of recorded convictions constitutes less than 1 per cent. of the boats engaged in illegal operations, having regard to the reports made from time to time about offenders which have been seen but escaped by concealing their names and numbers?
    Sir G. COLLINS: I am afraid that I have not made the arithmetical calculation that the hon. Member has in his mind.

    ROAD COMMUNICATIONS, HEBRIDES.
    Mr. T. RAMSAYasked the Secretary of State for Scotland if he is aware of the petitions and correspondence that have been put before the Department of Agriculture for years by the inhabitants of Strond and Borrisdale, Harris, requesting the construction of a road for vehicular traffic to connect them with the highway at each end of the townships; that a patient died while being conveyed from his home, which could not be reached by an ambulance either by land or air; and when will a road be provided for these townships and the people of South Harris?
    Sir G. COLLINS: The answer to the first part of the question is in the affirmative. I have no information as to the incident mentioned in the second part of the question. As I informed the hon. Member in my letter of 10th February, the initiative in the matter of providing a road rests with the county council to whom it would be open to apply for a Grant-in-Aid of the cost of constructing the road.
    Mr. T. RAMSAY: Is the right hon. Gentleman aware that when applications are sent in for the construction of township roads the Department of Agriculture, as a rule, leaves the initiative with the county council who generally take the view that the responsibility for constructing township roads lies with the Department of Agriculture who created the settlements; is he also aware that the almost invariable reply of the Department of Agriculture when definitely asked to construct such roads is "no funds available"; and will the right hon. Gentleman, therefore, get the money by pressing the Treasury for grants?
    Sir G. COLLINS: As the cost of maintaining these roads must rest on the
    1640
    county council in the future, the hon. Member will see that the initiative in constructing the road must rest on the shoulders of those who have to maintain them.
    Mr. RAMSAYasked the Secretary of State for Scotland if he is aware of the petitions and correspondence that have been put before the Department of Agriculture for years by the inhabitants of Lochportain, Cheesebay, and Hoebeg, North Uist, requesting the construction of a road for vehicular traffic to connect them with the highway about four miles distant; if he is aware that 32 holdings were created there by the Department eight years ago; and that the present means of communication with Lochmaddy is by sea, and when the sea is rough it is impossible to summon doctors or nurses in case of illness and cattle cannot be sent to market without loss; and when will a road be constructed to complete the settlement of these townships?
    Sir G. COLLINS: As I have already indicated to my hon. Friend, the initiative in this matter must rest with the county council.

    PIER, LOCHMADDY.
    Mr. T. RAMSAYasked the Secretary of State for Scotland if he is aware of the dangerous and badly lighted condition of the pier at Lochmaddy and of the fatal accident that occurred at the pier; and what he intends to do in order to provide a safe, enlarged, and well-lighted pier for the convenience of the inhabitants of North Uist?
    Sir G. COLLINS: I am aware that certain improvements at Lochmaddy Pier are desirable. There is, however, no evidence that the regrettable drowning accident to which my hon. Friend refers was due to any defect in the pier. As the pier is private property, no assistance can be given from public funds for its improvement.
    Mr. KIRKWOOD: Has the time not arrived when the Government should step in and when these piers should be owned by the State instead of being privately owned?
    Sir G. COLLINS: When the matter was inquired into, it was stated that there was no evidence that the accident was due to any defect whatever in the pier.

  COAL INDUSTRY.

    COSTS.
    Mr. DAVID GRENFELLasked the Secretary for Mines whether he will state the cost per ton of the miners' welfare levy, mining royalties, wayleaves, local rates, taxes, and workmen's compensation, respectively, for 1931 and 1932?
    The SECRETARY for MINES (Mr. Ernest Brown): In 1931, the average cost per ton of saleable coal raised of the miners' welfare levy was 1.00d., of royalties and wayleaves, including the rental value of freehold minerals where worked by the proprietor, 5.56d., of local rates 0.94d., and of workmen's compensation 3.35d. The corresponding figures for 1932 were 1.00d., 5.53d., 0.82d. and 3.56d., respectively. Similar information with regard to taxes is not available.
    Mr. BATEY: Do not those figures prove that, instead of the Government making an attack on the welfare levy, they should attack the mining royalties?
    Mr. BROWN: The hon. Member would be wrong in drawing that deduction.
    Mr. GODFREY NICHOLSON: Is the hon. Gentleman aware that, as far as Workmen's Compensation is concerned, there is a discrepancy between his figures and those of the Home Office?
    Mr. BROWN: If the hon. Member will examine the two figures, he will find that they are not on the same basis.

    PIT-HEAD BATHS.
    Mr. D. GRENFELLasked the Secretary for Mines the number of mines in which pit-head baths have been provided; the number without pit-head baths; and the estimated cost of providing suitable pit-head bath accommodation at all mines in the United Kingdom?
    Mr. E. BROWN: At the end of 1933 159 mines employing about 190,000 wage-earners had been provided with pit-head baths. In addition, building had been commenced or grants made for baths at 48 mines employing about 58,000 wage-earners, making a total of 207 mines with 248,000 wage-earners. There remain some 532,000 wage-earners without pit-head baths. To provide all these with baths, including canteens, would cost between 7½ and 8 million pounds.
    1642
    The hon. Member will realise, however, that there are a number of cases of small mines, or mines with only a short life ahead, where the construction of pit-head baths would not be a reasonable proposition. Apart from these cases, I estimate that approximately £7,125,000, the total which will be made available during the next 19 years under the Bill now before the House, will be sufficient to complete the programme.
    Mr. BATEY: As there are 540,000 miners who still need pit-head baths, does the Minister not consider that we should continue the levy and not reduce it?
    Mr. BROWN: No. There is a big advantage in the present Bill, because, instead of a short period of five years, it makes provision for 20 years and a programme that can be planned ahead. Further, the hon. Member must understand that the technical staff available for the work is limited.
    Mr. BATEY: Does the Minister suggest that the miners should wait for 20 years before they get pit-head baths?

    WELFARE LEVY.
    Mr. D. GRENFELLasked the Secretary for Mines whether he will state the figures showing the number of mines which have been closed as a result of liquidation since 1920, with the number in which arrears of miners' welfare levy had not been reclaimable?
    Mr. E. BROWN: I am unable to give the number of mines concerned. The number of undertakings which have been wound up since the inception of the fund to 28th February, 1934, and from which arrears of welfare levy have been irrecoverable, is 785. In addition, 79 undertakings are in course of being wound up, and the amount due is likely to be wholly or mainly irrecoverable.
    Mr. GRENFELL: Do not the figures clearly indicate that the so-called bad debts of the levy arise from the liquidation of very small mines?
    Mr. BROWN: Whether the mine is small or not, the difficulty is great for the individual.
    Mr. GRENFELL: Is it not clear that the percentage of arrears is very small?
    Mr. BROWN: That is another issue.

    OVERTIME.
    Mr. GEORGE HALLasked the Secretary for Mines whether he is aware of the increasing and unnecessary overtime worked by a number of miners at the River Level Colliery, Aberdare; and, in view of the large number of unemployed miners in this district, will he take immediate steps to deal with this matter?
    Mr. E. BROWN: Inquiries are being made into this matter, but are not yet completed. I will let the hon. Member know the result if he will put the question down again on Tuesday next.
    Mr. HALL: In the inquiries that are being conducted, will the hon. Gentleman see that representatives of the workmen are consulted by the person holding the inquiry?
    Mr. BROWN: The hon. Member must understand that this is a matter of management, but I will consider it.

    ABANDONED COLLIERIES, SOUTH WALES.
    Mr. EDWARD WILLIAMS (for Mr. DAVID DAVIES)asked the Secretary for Mines whether his attention has been drawn to the danger arising from the accumulation of water resulting from the abandonment of collieries in South Wales; and what steps he proposes to take to deal with the matter?
    Mr. E. BROWN: This problem receives the close attention of His Majesty's Inspectors and appropriate action in particular cases is taken whenever necessary, and I have no reason at present to apprehend that the safety of any mine worker in South Wales is endangered by accumulations of water in abandoned collieries. I should like to give careful consideration to any information on this point that the hon. Member can give me.
    Mr. WILLIAMS: May I ask whether the hon. Member is considering any scheme in connection with this matter?
    Mr. BROWN: The hon. Member is now raising a wider issue. The point in the question is that of danger; and I have given an answer. I shall be glad if he will put his further question on the Paper.
    Mr. D. GRENFELL: Is it not the case that the inconvenience and expense caused through the accumulation of
    1644
    water is due to the failure to achieve unified control in this coalfield?
    Mr. BROWN: I do not admit any danger; that is the purport of my answer?
    Mr. E. WILLIAMS (for Mr. DAVIES)asked the Secretary for Mines the number of collieries that have gone out of production in the South Wales coalfield since 1926 to date?
    Mr. BROWN: Since 1926, 287 coal mines in South Wales and Monmouth have been abandoned. Of these, 56 were new mines opened during this period.
    Mr. SMITHERS: Can the hon. Member say to what extent the abandonment of these mines is due to the restrictions imposed by the Coal Mines Act?
    Mr. BROWN: I do not apprehend that it has any relation to it.

    STONE DUST.
    Mr. E. WILLIAMS (for Mr. D. DAVIES)asked the Secretary for Mines the number of stone dust samples taken by his inspectors at the coal mines of this country during the years 1932 and 1933, and give the number containing matter which, if inhaled, would be injurious to the health of the mine workers?
    Mr. E. BROWN: The materials used for stone dusting in coal mines have been used for that purpose for many years and, their general character and composition being already known from past experience, the inspectors are in a position to deal with the matter at the collieries without taking repeated samples for analysis. The dusts from hard silicious rocks are known to be injurious, and are not allowed to be used for this purpose.
    Mr. WILLIAMS: Is the hon. Member aware that there is a strong body of opinion which believes that stone dust is the cause of silicosis, and will he inquire into the matter?
    Mr. BROWN: I could not answer that question in a supplementary reply. There are a number of inquiries going on, and there is a good deal of difference of opinion among experts.

  AGRICULTURE.

    AUSTRALIAN BUTTER (PRICES).
    Mr. LAMBERTasked the Secretary of State for Dominion Affairs if he is aware that the wholesale and retail prices of butter in Australia are 99s. 4d. per cwt., and 1s. 4d. per 1b., respectively, while the same quality butter is sold in London at 71s. per cwt., and 8d. to 9d. per 1b.; whether such a situation was contemplated by the Ottawa Agreements; whether the Australian Government has been informed that such subsidised exports have to be met by British subsidies to home-produced milk products; and, if so, what has been the reply?
    The UNDER-SECRETARY of STATE for DOMINION AFFAIRS (Mr. Malcolm MacDonald): During the period from approximately 29th January to 17th February—the latest period for which information is available—the wholesale price of what is known as "Kangaroo" butter was 98s. per cwt. (Australian currency) in Melbourne and the retail price there was approximately 1s. per 1b. I understand that the present wholesale price of the same quality of butter in London ranges from 68s. to 69s. per cwt. and that while the retail price varies in different districts it averages approximately 10d. per 1b. The variation between the prices in London and in Australia, therefore, is not as great as the figures given by the right hon. Member would suggest, even allowing for the cost of shipment, etc., and when allowance is also made for the difference between the value of Australian currency and of sterling. Price differentiation already existed at the time of the Ottawa Conference, and is not inconsistent with the Ottawa Agreement. The reply to the last part of the question is in the negative.
    Mr. LAMBERT: Is it not somewhat ridiculous that the British taxpayer should be called upon to subsidise milk production in this country in order to meet subsidised milk products from Australia?

    MILK PRODUCTS (IMPORTS).
    Mr. DREWEasked the Minister of Agriculture the amount of milk products, other than butter and cheese, imported from foreign countries in 1933; and how many gallons of milk this amount represents?
    The MINISTER of AGRICULTURE (Mr. Elliot): I am circulating in the OFFICIAL REPORT a statement giving the desired information.
    Mr. DREWE: Can my right hon. Friend give an answer to the last part of the question?
    Mr. ELLIOT: 83,000,000 gallons.
    Following is the statement:

    Imports of certain Milk Products from Foreign Countries during 1933.

    —

    Cwts.

    Fresh Milk Equivalent in 000's of gallons.*

    000's.

    Cream

    61,193

    4,161

    Condensed Milk:

    Sweetened, whole

    117,504

    3,196

    Sweetened, "separated or skimmed.

    1,833,216

    58,846

    Unsweetened

    247,039

    6,719

    Milk Powder:

    Unsweetened

    87,091

    10,329

    Sweetened

    177

    14

    Preserved Milk:

    Other kinds (Unsweetened).

    656

    55

    83,320

    * These figures show the approximate quantities of milk that would be required to manufacture the products in this country. The conversion figures are those used in the Report of the Reorganisation Commission for Milk (page 214).

    IRISH CATTLE (IMPORTS).
    Mr. DIXEYasked the Minister of Agriculture whether the Government will further restrict the imports of fat cattle from the Irish Free State after 31st March?
    Mr. ELLIOT: The question of imports of fat cattle from the Irish Free State after 31st March is at present under consideration.
    Mr. DIXEYasked the Minister of Agriculture how the numbers of cattle that have arrived in this country from the Irish Free State in January and February, 1934, compare with the numbers in the same period of 1933?
    Mr. ELLIOT: Exactly comparable figures are not available, but I am circulating in the OFFICIAL REPORT a table showing for January and February, 1933,

    1647
    the recorded exports from the Irish Free State to the United Kingdom and for January and February, 1934, the imports recorded in connection with the Cattle (Import Regulation) Order.
    Following is the table:

    —

    Jan. and Feb., 1933.

    Jan. and Feb., 1934.

    Fat cattle

    30,427

    13,096

    Store cattle

    36,993

    57,479

    Dry cows and bulls for slaughter.

    *

    2,437

    Milch cows

    2,015

    3,653

    Springers

    258

    589

    Calves

    8,167

    373†

    Total

    77,860

    77,627

    * Separate figures not recorded in 1933; probably included under "Store cattle."

    † This figure in 1934 represents only calves of six months and under. Calves over six months are included as Store cattle in 1934.

    BACON PRICES.
    Dr. HOWITTasked the Minister of Labour whether he will give the retail prices of bacon to the public at the present time, and comparable prices in the years 1929, 1930, and 1931?
    The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. R. S. Hudson): At 1st February, 1934, the latest date for which information is available, the average retail price of bacon, as ascertained by the inquiries which are made for the purpose of the official cost of living index number, was 1s. 1¾d. per 1b. At the corresponding dates in 1929, 1930 and 1931 the average retail prices per 1b. were 1s. 3¾d., 1s. 5½., and 1s. 0½d. respectively. The particulars collected relate as a rule to streaky bacon, but in some localities prices are obtained for other cuts which are more representative of local consumption.
    Mr. MANDER: Is it not a fact that the price to-day is threepence above what it would be if the Government had not forced the price up?

    CATTLE IMPORT REGULATIONS (SEIZURES).
    Mr. DIXEYasked the Financial Secretary to the Treasury if he will state what is the percentage of seizures by His Majesty's Customs at the various ports of landing of fat cattle shipped as stores from the Irish Free State?
    Mr. HORE-BELISHA: Information in the form asked for by my hon. Friend is not available, but I may say that in the period from the 1st January when the Cattle (Import Regulations) Order, 1933, came into operation, to the 24th February, the total number of seizures of fat cattle at all ports was 185 representing one-third of 1 per cent. of the total number of cattle imported.

  POST OFFICE.

    GLASGOW CENTRAL OFFICE (DATE INDICATORS).
    Mr. LEONARDasked the Postmaster-General if he will take immediate steps to instal, for the use of the public using the Glasgow Central Post Office, a date indicator or calendar?
    The ASSISTANT POSTMASTER-GENERAL (Sir Ernest Bennett): Arrangements have been made to instal four date indicators at the public counter in the Glasgow Head Post Office.
    Mr. LEONARD: Is the hon. Member aware of some of the promises which were made on the 18th March last year, and will he see that this promise is acted upon?
    Sir E. BENNETT: I have just informed the hon. Member that I have given him more than he has asked. He asked for one, and I have given him four.
    Mr. LEONARD: Seeing that we waited one year for one, we might have to wait four years for four.

    FACILITIES, GATESIDE, FIFE.
    Mr. HENDERSON STEWARTasked the Postmaster-General if, in view of the evidence submitted to him and the petition signed by 124 householders in Gateside, Fife, he will now agree to making special inquiries into the complaints regarding the postal service in that district?
    Sir E. BENNETT: I have received the petition in question and will write to my hon. Friend when I have made the necessary inquiries.
    Mr. STEWART: Will the Minister consider convening a public meeting of the petitioners which might be met by his representative end the whole matter discussed openly and grievances expressed, and, I hope, redressed.
    Sir E. BENNETT: I am afraid that I cannot add to what I have told the hon. Member, namely, that I have received a petition and am looking into the matter.

    JUSTICES OF THE PEACE (REMOVALS).
    Mr. MANDERasked the Attorney-General the number of magistrates removed from the bench during each of the last three years and the reasons therefor, whether age, at their own request, or for other causes?
    The ATTORNEY-GENERAL (Sir Thomas Inskip): In 1931 four Justices of the Peace were removed from the Commission of the Peace following convictions for criminal offences, and in 1932 two for the same reason. There were no removals in 1933. Three Justices in 1931 and 1932 respectively and one in 1933 were permitted to resign in view of misbehaviour. I regret I am unable to give the hon. Member the number that have resigned for other reasons, as no records are kept of resignations other than resignations in view of misbehaviour.
    Mr. LOVAT-FRASER: Can the right hon. and learned Gentleman say how many magistrates there are over the age of 90?
    The ATTORNEY-GENERAL: I cannot tell my hon. Friend.
    Mr. MANDER: Can the right hon. and learned Gentleman say whether any of those magistrates were women, or whether they were all men?
    The ATTORNEY-GENERAL: That information is not recorded.
    Viscountess ASTOR: If they were all men, does not it show the necessity of having more women?

  UNEMPLOYMENT.

    UNEMPLOYED MARCHERS (POLICE).
    Mr. CRAVEN-ELLISasked the Home Secretary if he can state the estimated cost for police protection and control in respect of the unemployed marchers?
    Sir J. GILMOUR: If the hon. Member will repeat his question in a week's time, I hope that it will then be possible to give him an answer.
    Mr. CRAVEN-ELLIS: May I ask if the attention of the right hon. Gentleman has been drawn to a speech which was made by one of the leaders of the hunger marchers on 25th February, in which he said that this was a magnificent revolutionary demonstration?

    UNEMPLOYMENT BILL.
    Mr. MARTINasked the Prime Minister if he will consider the immediate appointment of a commission to inquire into the effects of unemployment on the industrial population of the country, with particular reference to the children, so that they may issue a report and make recommendations which could serve as a guide to those who will be charged with the duty of administering the Unemployment Insurance Bill when it becomes an Act?
    The PRIME MINISTER (Mr. Ramsay MacDonald): Having regard to the sources of information which are already open to the Government, and which will be at the disposal of those charged with the duty of administering the provisions of the Unemployment Bill, I do not think that it is necessary to appoint a special commission of inquiry.
    Mr. MARTIN: Will the Prime Minister consider issuing some paper collecting and collating those sources of information?
    The PRIME MINISTER: I am perfectly willing to consider the suggestion of my hon. Friend, but I doubt its utility.
    Mr. GRAHAM WHITEasked the Chancellor of the Exchequer what action he proposes to take to protect local authorities from loss in the event of the coming into operation of the financial provisions of the Unemployment Bill being delayed?
    Mr. HORE-BELISHA: No contributions will be required to be made by local authorities until the provisions of Part II of the Unemployment Bill with which they are concerned come into operation, and no question of loss can, therefore, arise.

    TWENTY-FOUR HOUR TIME SYSTEM.
    Mr. WHITESIDEasked the Home Secretary whether he intends to give effect to the recommendations of the

    1651
    Home Office Committee in 1919 for the adoption, for official and other purposes, of the 24-hours' system of expressing time?
    Sir J. GILMOUR: In the absence of any evidence of general public demand for the change indicated, His Majesty's Government does not feel justified in taking any action. I am informed that the British Broadcasting Corporation have decided in the near future, as an experiment, to adopt the 24-hour system for all purposes; and His Majesty's Government will await the result of that experiment before giving further consideration to the matter.
    Mr. WHITESIDE: Will the Minister say whether it is a fact or not that this system has already been adopted by the Services, and by the Post Office?
    Sir J. GILMOUR: Certainly not by the Post Office. It was, of course, adopted by the Services during the War.

    SUGAR INDUSTRY.
    Mr. E. WILLIAMSasked the Minister of Agriculture, having regard to the draft scheme for the marketing of sugar, whether he will state what is the present composition of the general committee of the sugar industry and what are its functions?
    Mr. ELLIOT: The General Committee of the United Kingdom Sugar Industry consists of representatives of the 15 companies operating beet sugar factories in England and Scotland and seven sugar refining companies. The committee was set up by the industry with the object of promoting agreement in the industry as a whole and of submitting agreed reorganisation proposals to the Government.
    Mr. MALLALIEUasked the Financial Secretary to the Treasury what would have been the revenue derived from duties upon sugar and molasses manufactured from beet grown in Great Britain in 1933 if duties had been levied upon them at the rates chargeable upon sugar and molasses imported from foreign countries and from Empire countries, respectively?
    Mr. HORE-BELISHA: Precise figures relating to sugar and molasses manufac-
    1652
    tured from beet grown in a particular year are not available but the approximate amount of duty which would have been paid on sugar and molasses manufactured from home-grown beet delivered for home consumption in 1933 had duty been charged at the rates applicable to sugar and molasses imported from foreign countries and Empire countries respectively is as follows:

    £

    From foreign countries

    4,602,000

    From Empire countries

    2,107,000

    WEST INDIES AND BERMUDA (NAVAL BASES).
    Mr. DONNERasked the Prime Minister whether, in view of the apprehension in Bermuda, the Solomon Islands and the West Indies, he will give an assurance that, under no circumstances whatever, will His Majesty's Government agree to a settlement of war debts as between this country and the United States by ceding territory or any portion of the British Empire?
    The PRIME MINISTER: It is, I think, self-evident that there could under no circumstances be any question of such an arrangement.
    Mr. DONNER: While thanking the right hon. Gentleman for his reply, may I ask him whether he discussed with the Government of the United States the question of dismantling our naval bases in the West Indies and Bermuda?

    AIR DEFENCE (NAVAL BASES).
    Mr. LAMBERTasked the Prime Minister whether the Imperial Defence Committee has considered the vulnerability of the naval bases of Chatham, Sheerness and Portsmouth to aerial attack; and what have been the conclusions reached?
    The PRIME MINISTER: The answer to the first part of the question is in the affirmative. It would not be in the public interest, however, for details of the conclusions reached or the measures taken to be disclosed.
    Mr. LAMBERT: Are there no means whereby we may obtain some information on this matter, which is causing legitimate anxiety?
    The PRIME MINISTER: I am afraid I cannot add to what I have said.
    Mr. D. GRENFELL: Is it not the case that there are no means of rendering invulnerarble the places referred to?
    The PRIME MINISTER: I am not a military authority.

    UNIVERSITY OF DURHAM (ROYAL COMMISSION).
    Mr. MARTINasked the Prime Minister the composition and terms of reference of the Royal Commission to be set up to inquire into the affairs of Durham University and its constituent colleges?
    The PRIME MINISTER: As my right hon. Friend has already announced, the Chairman of this Royal Commission will be Lord Moyne. The other members will be:

    The Countess Grey,

    Sir Ross Barker,

    Major A. G. Church,

    Dr. H. R. Dean,

    The Rev. F. Homes Dudden,

    Dr. T. F. Sibly and

    Mr. W. Spens.

    The Terms of Reference are:
    "To inquire into the organisation and work of the University and its three constituent colleges and into the relation of the University to those colleges, and to report in what respects the present organisation can be improved and what changes if any are desirable in the constitutions functions, and powers of the University and its three constituent colleges."

    IMPORTED MOLASSES (DISTILLATION).
    Colonel ROPNERasked the Chancellor of the Exchequer whether he is aware that molasses is being imported into this country for the purpose of distilling alcohol from it, and whether Excise Duty is charged on such alcohol and at what rate; whether he is satisfied that the steps being taken in this direction are adequate to protect the revenue in view of the fact that this alcohol is being mixed with motor spirit and used as a substitute therefor?
    Mr. HORE-BELISHA: I am aware that alcohol is and for many years has been distilled in this country from imported
    1654
    molasses; such alcohol when made into power methylated spirits and when used for industrial purposes generally is expressly exempted by statute from the Excise Duty on spirits; the matter is kept under careful observation, but I do not consider that any action is called for at present.

    EMPIRE EXCHANGES (STABILISATION).
    Mr. CRAVEN-ELLISasked the Chancellor of the Exchequer whether it is the intention of His Majesty's Government to take early action to give effect to the declaration of the Empire delegates to the World Economic Conference on the desirability of stabilising exchanges between Empire countries?
    Mr. HORE-BELISHA: I would refer to the reply given to my hon. Friend the Member for Kidderminster (Sir J. Wardlaw-Milne) on the 1st February.
    Mr. CRAVEN-ELLIS: Is the hon. Member aware that the delay on the part of the Government in regard to the stabilisation of exchanges is handicapping the recovery of international trade?
    Mr. HORE-BELISHA: I do not follow my hon. Friend. Except for Canada, all the important Empire currencies, whether Dominion, Indian or Colonial, are linked with sterling and have not fluctuated in the terms of sterling since July.
    Mr. CRAVEN-ELLIS: I referred to international currency.

    REGISTRAR-GENERAL'S STATISTICAL REVIEW.
    Mr. H. WILLIAMSasked the Financial Secretary to the Treasury if he can arrange for future issues of the Registrar-General's statistical review to be presented to Parliament as a Command Paper?
    Mr. HORE-BELISHA: I am unaware of any reason why a less economical arrangement should apply to the issue of this particular publication than to other non-parliamentary publications.
    Mr. WILLIAMS: Is the hon. Member aware that the Minister of Health in answering a question made reference to this document, instead of quoting

    1655
    statistics? In these circumstances, how can hon. Members obtain information if Ministers decline to furnish it and also decline to publish the document?
    Mr. HORE-BELISHA: Any hon. Member can obtain a copy on demand. What the hon. Member is asking is that every Member of Parliament should be automatically supplied with this expensive publication.
    Mr. WILLIAMS: Is it not a fact that Ministers in answering questions decline to furnish statistics unless those statistics are contained in a paper presented to Parliament?
    Mr. HORE-BELISHA: The hon. Member cannot expect me to answer that question. He must address it to the Minister concerned.

    MANCHURIA.
    Mr. MANDERasked the Secretary of State for Foreign Affairs whether, in view of the ceremonies at Tokio in connection with the elevation of Pu-Yi to the imperial throne of Manchuria, any special instructions have been sent to the British Ambassador at Tokio to abstain from taking any action which may imply recognition?
    The LORD PRIVY SEAL (Mr. Eden): I have nothing to add to the reply which my right hon. Friend gave to a similar question put by the hon. Member for Normanton (Mr. T. Smith) yesterday.
    Mr. MANDER: Are we to understand that there is no question of extending official recognition to this puppet Emperor, set up by Japan?
    Mr. DONNER: In view of all the circumstances and the possibilities there are of obtaining extensions for trade, does the hon. Member not think that it is to our interest to take action?
    Mr. EDEN: The position is covered by the Resolution of the Assembly, and I have no reason to doubt that those who signed the Resolution will carry it out.
    Mr. DONNERasked the Secretary of State for Foreign Affairs whether, in view of the coronation of the Emperor Pu-Yi, His Majesty's Government will now consider the extension of official recognition to Manchukuo?
    Mr. EDEN: The attitude of His Majesty's Government towards the question of according recognition to the existing regime in Manchuria continues to be governed by the terms of the League of Nations Resolution of the 24th February, 1933.
    Sir BASIL PETO: In the interests of opening up trade in this country, is it not as important for us to be first in a territory of that kind as it is that we should have equal rights with other countries in regard to trading with Soviet Russia?
    Mr. MANDER: Can the hon. Member say whether so far every country has observed the conditions of the Assembly Resolution?
    Mr. EDEN: So far as I am aware all those who are parties to it have done so.

    TOWN AND COUNTRY PLANNIN ACT.
    Mr. MANDERasked the Minister of Health whether the advisory committee in connection with the operation of the Town and Country Planning Act will be enabled by its terms of reference to give consideration to the question of national parks; and whether this will be borne in mind in selecting the personnel?
    The PARLIAMENTARY SECRETARY to the MINISTRY of HEALTH (Mr. Shakespeare): It will be competent to the advisory committee to consider the question of national parks in connection with planning schemes. When the personnel of the committee is announced, my right hon. Friend feels sure that the hon. Member will be satisfied that this aspect of planning has not been overlooked.
    Viscountess ASTOR: In considering the question of national parks and houses to be built, will the Minister consider the advisability of placing the houses a little further back from the national roads, thereby saving the lives of hundreds of children?
    Mr. SHAKESPEARE: Those powers are already possessed by local authorities under the Town and Country Planning Act.

    TUBERCULOSIS.
    Captain ELLISTONasked the Minister of Health what percentage of all deaths from tuberculosis are caused by the bovine type of bacillus; how many children die annually from this cause; how many fresh cases of bovine infection develop each year; and what immediate steps can be taken to protect the public against the danger of tubercle infection through milk?
    Mr. SHAKESPEARE: The best available information on the subject is contained in an official Memorandum on Bovine Tuberculosis in Man, a copy of which I am sending to my hon. and gallant Friend. As regards the last part of the question, local authorities already have powers for stopping the supply of milk infected with tuberculosis and a committee of the Economic Advisory Council is now considering measures for reducing the incidence of bovine tuberculosis and improving the milk supply.

BUSINESS OF THE HOUSE.
Mr. ATTLEE: May I ask the Prime Minister how far he intends to go this
evening in the event of the Motion to suspend the Eleven o'Clock Rule being carried?.
The PRIME MINISTER: The Government are moving that Motion simply as a precautionary measure. We want to get the first three Orders on the Paper, and would also like to go on with the County Courts (Amendment) Bill, Second Reading, and the Committee stage of the Money Resolution; the Committee stage of the Money Resolution in connection with Overseas Trade [Guarantees], and the Money Resolution in regard to the British Sugar Subsidy; but only in the event of the first three Orders being dealt with before 11 o'clock. The items that must be done are the first three on the Order Paper.
Motion made, and Question put,
"That the Proceedings on Government Business be exempted, at this day's Sitting, from the provisions of the Standing Order (Sittings of the House)."—[The Prime Minister.]
The House divided: Ayes, 248; Noes, 45.

Division No. 142.]

AYES.

[3.36 p.m.

Acland-Troyte, Lieut.-Colonel

Colville, Lieut.-Colonel J.

Gillett, Sir George Masterman

Adams, Samuel Vyvyan T. (Leeds, W.)

Conant, R. J. E.

Gilmour, Lt.-Col. Rt. Hon. Sir John

Albery, Irving James

Cook, Thomas A.

Gluckstein, Louis Halle

Allen, Lt.-Col. J. Sandeman (B'k'nh'd.)

Cooke, Douglas

Glyn, Major Sir Ralph G. C.

Allen, William (Stoke-on-Trent)

Cooper, A. Duff

Goldie, Noel B.

Anstruther-Gray, W. J.

Craddock, Sir Reginald Henry

Goodman, Colonel Albert W.

Applin, Lieut.-Col. Reginald V. K.

Cranborne, Viscount

Graham, Sir F. Fergus (C'mb'rl'd, N.)

Astor, Viscountess (Plymouth, Sutton)

Craven-Ellis, William

Grattan-Doyle, Sir Nicholas

Barclay-Harvey, C. M.

Croft, Brigadier-General Sir H.

Graves, Marjorie

Beaumont, Hon. R. E. B. (Portsm'th, C.)

Crooke, J. Smedley

Gretton, Colonel Rt. Hon. John

Beit, Sir Alfred L.

Crookshank, Col. C. de Windt (Bootle)

Guinness, Thomas L. E. B.

Bennett, Capt. Sir Ernest Nathaniel

Crookshank, Capt. H. C. (Gainsb'ro)

Gunston, Captain D. W.

Bernays, Robert

Crossley, A. C.

Guy, J. C. Morrison

Birchall, Major Sir John Dearman

Cruddas, Lieut.-Colonel Bernard

Hacking, Rt. Hon. Douglas H.

Blindell, James

Culverwell, Cyrll Tom

Hammersley, Samuel S.

Borodale, Viscount

Davies, Maj. Geo. F. (Somerset, Yeovil)

Hanhury, Cecil

Boulton, W. W.

Davison, Sir William Henry

Hanley, Dennis A.

Bowyer, Capt. Sir George E. W.

Denman, Hon. R. D.

Harbord, Arthur

Broadbent, Colonel John

Despencer-Robertson, Major J. A. F.

Hartland, George A.

Brocklebank, C. E. R.

Dixey, Arthur C. N.

Harvey, George (Lambeth, Kenningt'n)

Brown, Ernest (Leith)

Donner, P. W.

Harvey, Major S. E. (Devon, Totnes)

Browne, Captain A. C.

Drewe, Cedric

Haslam, Sir John (Bolton)

Bullock, Captain Malcolm

Duckworth, George A. V.

Headlam, Lieut.-Col. Cuthbert M.

Burgin, Dr. Edward Leslie

Duggan, Hubert John

Heligers, Captain F. F. A.

Burnett, John George

Duncan, James A. L. (Kensington, N.)

Henderson, Sir Vivian L. (Chelmsford)

Butler, Richard Austen

Dunglass, Lord

Heneage, Lieut.-Colonel Arthur P.

Caine, G. R. Hall.

Eady, George H.

Hepworth, Joseph

Campbell, Sir Edward Taswell (Brmly)

Elliot, Rt. Hon. Walter

Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

Caporn, Arthur Cecil

Elliston, Captain George Sampson

Hope, Capt. Hon. A. O. J. (Aston)

Castlereagh, Viscount

Elmley, Viscount

Hore-Belisha, Leslie

Cayzer, Sir Charles (Chester, City)

Emmott, Charles E. G. C.

Horsbrugh, Florence

Cayzer, Maj. Sir H. R. (Prtsmth., S.)

Emrys-Evans, P. V.

Howitt, Dr. Alfred B.

Cazalet, Thelma (Islington, E.)

Evans, Capt. Arthur (Cardiff, S.)

Hudson, Robert Spear (Southport)

Cazalet, Capt. V. A. (Chippenham)

Everard, W. Lindsay

Hurd, Sir Percy

Christle, James Archibald

Fleming, Edward Lascelles

Hurst, Sir Gerald B.

Churchill, Rt. Hon. Winston Spencer

Ford, Sir Patrick J.

Jackson, Sir Henry (Wandsworth, C.)

Clarke, Frank

Fox, Sir Gifford

James, Wing-Com. A. W. H.

Clarry, Reginald George

Fuller, Captain A. G.

Jamleson, Douglas

Clayton, Sir Christopher

Gault, Lieut.-Col. A. Hamilton

Jesson, Major Thomas E.

Collins, Rt. Hon. Sir Godfrey

Gibson, Charles Granville

Jones, Lewis (Swansea, West)

Ker, J. Campbell

Oman, Sir Charles William C.

Soper, Richard

Kerr, Hamilton W.

Ormsby-Gore, Rt. Hon. William G. A.

Sotheron-Estcourt, Captain T. E.

Lamb, Sir Joseph Quinton

Palmer, Francis Noel

Spencer, Captain Richard A.

Lambert, Rt. Hon. George

Patrick, Colin M.

Spender-Clay, Rt. Hon. Herbert H.

Law, Richard K. (Hull, S. W.)

Peaks, Captain Osbert

Stanley, Rt. Hon. Lord (Fylde)

Leckie, J. A.

Peters, Dr. Sidney John

Stanley, Hon. O. F. C. (Westmorland)

Leech, Dr. J. W.

Petherick, M.

Stewart, J. H. (Fife, E.)

Leighton, Major B. E. P.

Peto, Sir Basil E. (Devon, Barnstaple)

Stones, James

Lewis, Oswald

Peto, Geoffrey K. (W'verh'pt'n, Bilst'n)

Storey, Samuel

Lindsay, Kenneth Martin (Kilm'rnock)

Pownall, Sir Assheton

Stourton, Hon. John J.

Lindsay, Noel Ker

Procter, Major Henry Adam

Strauss, Edward A.

Locker-Lampson, Rt. Hn. G. (Wd. Gr'n)

Raikes, Henry V. A. M.

Strickland, Captain W. F.

Loder, Captain J. de Vere

Ramsay, Capt. A. H. M. (Midlothian)

Stuart, Lord C. Crichton-

Loftus, Pierce C.

Ramsay, T. B. W. (Western isles)

Sueter, Rear-Admiral Sir Murray F.

Lovat-Fraser, James Alexander

Rawson, Sir Cooper

Tate, Mavis Constance

Lumley, Captain Lawrence R.

Reed, Arthur C. (Exeter)

Taylor, Vice-Admiral E. A. (P'dd'gt'n, S.)

Mabane, William

Reid, Capt. A. Cunningham-

Thomas, James P. L. (Hereford)

MacAndrew, Lt.-Col. C. G. (Partick)

Reid, William Allan (Derby)

Thorp, Linton Theodore

MacAndrew, Capt. J. O. (Ayr)

Remer, John R.

Titchfield, Major the Marquess of

MacDonald, Rt. Hon. J. R. (Seaham)

Rickards, George William

Todd, A. L. S. (Kingswinford)

McEwen, Captain J. H. F.

Robinson, John Roland

Touche, Gordon Cosmo

McKie, John Hamilton

Ropner, Colonel L.

Train, John

McLean, Major Sir Alan

Rosbotham, Sir Thomas

Tryon, Rt. Hon. George Clement

Macpherson, Rt. Hon. Sir Ian

Ross Taylor, Walter (Woodbridge)

Tufnell, Lieut.-Commander R. L.

Maitland, Adam

Ruggles-Brise, Colonel E. A.

Ward, Irene Mary Bewick (Wallsend)

Makins, Brigadier-General Ernest

Runciman, Rt. Hon. Walter

Ward, Sarah Adelaide (Cannock)

Manningham-Buller, Lt.-Col. Sir M.

Runge, Norah Cecil

Wayland, Sir William A.

Margesson, Capt. Rt. Hon. H. D. R.

Russell, Alexander West (Tynemonth)

Wedderburn, Henry James Scrymgeour-

Martin, Thomas B.

Russell, R. J. (Eddlsbury)

Whiteside, Borras Noel H.

Mayhew, Lieut.-Colonel John

Rutherford, John (Edmonton)

Whyte, Jardine Bell

Meller, Sir Richard James

Salmon, Sir Isidore

Williams, Charles (Devon, Torquay)

Mills, Major J. D. (New Forest)

Salt, Edward W.

Williams, Herbert G. (Croydon, S.)

Milne, Charles

Samuel, Sir Arthur Michael (F'nham)

Willoughby de Eresby, Lord

Mitchell, Sir W. Lane (Streatham)

Sandeman, Sir A. N. Stewart

Wills, Wilfrid D.

Molson, A. Hugh Elsdale

Savory, Samuel Servington

Windsor-Clive, Lieut.-Colonel George

Moore, Lt.-Col. Thomas C. R. (Ayr)

Shakespeare, Geoffrey H.

Wise, Alfred R.

Moss, Captain H. J.

Shaw, Helen B. (Lanark, Bothwell)

Womersley, Walter James

Muirhead, Lieut.-Colonel A. J.

Shepperson, Sir Ernest W.

Wood, Rt. Hon. Sir H. Kingsley

Munro, Patrick

Simmonds, Oliver Edwin

Worthington, Dr. John V.

Nation, Brigadier-General J. J. H.

Skelton, Archibald Noel

Nicholson, Godfrey (Morpeth)

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

TELLERS FOR THE AYES.—

Nicholson, Rt. Hn. W. G. (Petersf'ld)

Smithers, Waldron

Sir Victor Warrender and Sir Frederick Thomson.

Normand, Rt. Hon. Wilfrid

Somerset, Thomas

Nunn, William

Somerville, Annesley A (Windsor)

NOES.

Acland, Rt. Hon. Sir Francis Dyke

Hall, George H. (Merthyr Tydvil)

Milner, Major James

Attlee, Clement Richard

Hamilton, Sir R. W. (Orkney & Zetl'nd)

Paling, Wilfred

Banfield, John William

Holdsworth, Herbert

Parkinson, John Allen

Batey, Joseph

Jenkins, Sir William

Pickering, Ernest H.

Cape, Thomas

Johnstone, Harcourt (S. Shields)

Rea, Walter Russell

Cocks, Frederick Seymour

Jones, Morgan (Caerphilly)

Roberts, Aled (Wrexham)

Cripps, Sir Stafford

Kirkwood, David

Samuel, Rt. Hon. Sir H. (Darwen)

Daggar, George

Leonard, William

Smith, Tom (Normanton)

Davies, David L. (Pontypridd)

Logan, David Gilbert

Thorne, William James

Davies, Rhys John (Westhoughton)

Lunn, William

Tinker, John Joseph

Dobbie, William

McEntee, Valentine L.

White, Henry Graham

Edwards, Charles

Maclean, Nell (Glasgow, Govan)

Williams, David (Swansea, East)

Foot, Isaac (Cornwall, Bodmin)

Mainwaring, William Henry

Williams, Edward John (Ogmore)

George, Major G. Lloyd (Pembroke)

Mallalieu, Edward Lancelot

George, Megan A. Lloyd (Anglesea)

Mander, Geoffrey le M.

TELLERS FOR THE NOES.—

Grenfell, David Rees (Glamorgan)

Mason, David M. (Edinburgh, E.)

Mr. Groves and Mr. G. Macdonald.

Bill read a Second time.

ORDERS OF THE DAY.

  INDIAN PAY (TEMPORARY ABATEMENTS) BILL.
  Order for Second Reading read.
  3.45 p.m.
  The UNDER-SECRETARY of STATE for INDIA (Mr. Butler): I beg to move, "That the Bill be now read a Second time."
  The purpose of the Bill is to continue an emergency cut in the pay of those servants whose pay is protected by Parliament, for a further emergency period until 1st April, 1935. The House will remember that the original 10 per cent. cut in the pay of these servants made by Parliament was imposed as a result of the economic crisis in September, 1931. The cut was reintroduced at a lower rate of 5 per cent. in April of last year, and the necessary authority of Parliament for the imposition of the cut was given in the Indian Pay (Temporary Abatements) Acts of 1931 and 1933. When I introduced a similar Bill to this last year I explained to the House that this legislation affected only officers appointed by the Secretary of State before 1919. In 1931 the cut was imposed upon the whole range of officers in India, the whole range of Government servants; it was thought invidious then that this small class of protected officers, whose pay could not be reduced except with the consent of Parliament, should escape.
  Since it has been found necessary, as I shall explain, to reimpose this cut for a further period, it has been thought that this Bill should be introduced to deal with the class of officers whose pay on the whole is higher than that of the others, that they should not escape, and that all should be treated alike. When the Bill was brought in last year it was sincerely hoped that it would be possible to avoid continuing the cut for a further period. It was hoped that finances might have improved sufficiently to render unnecessary the introduction of a Bill of this sort. Unfortunately, owing to the continuation of the world economic depression it is necessary to introduce this Measure. The Government regret that they see no alternative to introducing the Bill and continuing the cut, even if it be at the reduced rate of 5 per cent.
  1668
  Since the economic depression the Government of India have never slackened in their efforts to achieve and maintain financial stability. They are approaching the Budget of 1934–35 in the same exemplary spirit. In order to avoid a deficit it has been proposed to raise an extra £4,000,000 by taxation and other measures. The House will see, therefore, that if we did not introduce this Bill the amount would have to be substantially increased. In the case of the Provinces, there are several in which there are special circumstances calling for continued economy. For example, special help is necessary from the central Budget to meet a deficiency in Bengal. There is also provision in that Budget for a grant to Bihar, where the colossal earthquake has made the financial position especially difficult. The House will see that it is impossible to save the necessary £2,500,000, which is the sum that would be required were the cuts to be removed in toto. That sum comprises the money necessary to relieve the cuts on all the services in India including the railway service. Therefore, I think hon. Members will agree that there is no alternative to continuing this cut.
  It has been represented that the mere fact of having come to this House would undermine the security which the services felt in the fact that their pay could not be cut except with the consent of Parliament. I would rather envisage this procedure, which is necessary before this pay can be cut, as being an example of the special safeguard enjoyed by the Secretary of State's services in India. This Debate gives Parliament a satisfactory opportunity of discussing the matter and is a proof of the reality of the safeguard. The Government however desire to make it clear that the continuance of the cut for another year in no way implies that the present deduction in the pay of existing servants in India is other than temporary, as the terms of the Bill itself indicate. The restoration to the services in India of their full pay at the earliest possible moment is still the fixed determination of the Government and it is with the greatest regret that they have found it necessary to postpone the fulfilment of their earnest desire. It may be apposite to quote some words used by Sir George Schuster in proposing the Indian Budget to the Legislative Assembly. Having

  1669
  said that the finances of India bore comparison with those of any country in the world he used these words:
  "We seem to have touched the bottom. If the tendencies which have recently been apparent continue, there is good hope that there will be a margin next year large enough, not merely for the restoration of the cuts but for the relaxation of other burdens."
  He added:
  "Neither India nor any other country is yet out of the wood and a cautious outlook is still necessary."
  I sincerely hope that the services will accept the unfortunate necessity of continuing the cut. Even though it be at a reduced rate, to many of them it may seem obnoxious, but I am sure they will accept the necessity with the same good sense as they did on the previous occasion. It is largely due to the loyal determination of the services that an improvement in the Indian position has been seen during the last 12 months. To an officer on small rates of pay every rupee counts, and the House must realise that if we are to "emerge from the wood" it means demanding additional sacrifice from some of the most devoted servants of the Empire. If this improvement in the general position is to continue, it will again demand the loyal co-operation of the members of our services in India and of their families, living, perhaps, in some post where absence from home makes his burden all the more serious. I am sure that our Indian officials and service men can look with confidence to the sympathy of this House, and I am sure that this House will show that it is appreciative, despite the regrettable necessity of the Measure which I am obliged to introduce.
  3.55 p.m.
  Mr. ATTLEE: It is only necessary for me to say a few words on behalf of the Members on this side of the House. This Bill is really a continuation of a policy which has been laid before us previously and is, of course, merely consequential on what has been done in India. In India it has been decided that cuts should be made in the pay of the Civil Service there, and I think that the civil servants in India themselves would be the first to resent any difference being made between one section and another, where sacrifice has been asked from all, merely because certain services hold a privileged position. As the Government of India
  1670
  has decided that certain cuts should be made in the pay of their services, it is only right that this House should take action to see that among all those civil servants the sacrifice is alike. We all recognise the hardship imposed by cuts. We all hope that cuts will soon come to an end in India and in this country, but in the meantime we cannot do anything but support this Measure.
  3.56 p.m.
  Captain CAZALET: May I express my regret that the Under-Secretary of State for India has been under the necessity of bringing this Bill forward once again this year. Had it not been for the sudden and unexpected fall in the prices of certain commodities and the disaster which occured in a certain part of India, one hoped that it would have been possible to have had these cuts restored fully this year. I regret the necessity for continuing the cuts and I do so on two grounds. First there is the question of principle. I regret that it was thought necessary a few years ago to break a contract with certain servants of the Crown. I believe that the same results would have been obtained on a voluntary basis. I regret, too, that this precedent has been set up, because it is one which may possibly be appealed to and quoted in the future. Secondly, I regret this Measure because of what it entails and has entailed to a large number of officers in India.
  The pay of junior officers—indeed of those up to the ranks of major and colonel—in India, is none too generous under existing conditions. A few months ago I made some investigations as to the actual pay received by certain officers and the expenses necessarily incurred by them. I do not think hon. Members realise the difference between the standard of living which an officer has to support in India and that which has to be maintained anywhere else in His Majesty's Dominions. The argument is often used that the British officer in England has had to suffer a cut of 11 per cent. whereas the officer in India has only suffered a cut of 5 per cent. But in England the 11 per cent. cut has come slowly and step by step and has been accompanied by a definite reduction in the cost of living, whereas in India the cut came suddenly and it has certainly not been accompanied by any decrease in

  1671
  the cost of living there. In India it is impossible for an officer to alter his standard of living or to reduce the standard of wages of the servants whom he has to employ.
  In addition, there has been during the last two years and even in the last year a great increase in the duties and the surtax put upon imports which an officer in India has to buy for his own and his family's use. For instance I was informed that in certain messes bacon is no longer served for breakfast owing to the peculiarly high duty placed upon imports of that commodity. The amenities available for these officers in many parts of India are few and far between. Club life which is almost essential for social intercourse out there, has nearly ceased to exist, very largely because of the increase in the cost of living and the decrease in the pay of officers. Side by side with these officers there are the members of the Indian Civil Service, who far be it from me to say are overpaid, who, however, do receive better pay and better allowances than officers living more or less under the same conditions and of the same age. Although I quite appreciate the difficulty which the Government have had in facing this problem this year, and, it may be, even the impossibility of restoring these cuts, I hope and trust that next year, in fairness to these most deserving servants of the Crown, the Secretary of State and the Government of India will see their way to restore the full cuts.
  4.1 p.m.
  Captain FULLER: Whatever our views may be with regard to this Bill, I think that we must all associate ourselves with the remarks of the Under-Secretary when he expressed his regret at the necessity of once again coming to the House and asking for this Bill to be passed. This is the third time of asking, and I think we all hope that it will, as in another case, be the last time of asking. I think that in introducing the Bill the hon. Gentleman did not quite do justice to his own case. He has introduced a paradox, if I may say so, into the situation, because he based his case on what is essentially the dark side of the financial situation of India, whereas we in this House, and the country and world at large, have been invited in the last few
  1672
  days by the Finance Member of the Government of India to look upon the rosy side of the finances, as he sees them, and as he saw them when he introduced the Budget.
  I am bound to say that if the case for this Bill rested upon the condition of the finances of the Central Government, I would be inclined to oppose it, because we have been told, and it is the fact, that the budgetary position in India for the last few years is that all outgoings have been met from revenue, and there has been, in addition, a very considerable sum—some eight crores—set aside for debt reduction. I think that is a state of affairs for which the Finance Member is entitled to be justly proud and with which few other countries in the world can compare. In the same Budget there has been, as the hon. Gentleman mentioned, quite a large appropriation for earthquake relief, a matter over which no one, unfortunately, has any control, but which we are entitled to think might have been applied to the alleviation of the situation in which these cuts have occasioned if the earthquake had not occurred. We must not forget, in considering the favourable position of the finances of the Central Government, that there has been a very large saving in expenditure, due once again to the efforts of the British taxpayer, because we have been told that a very large reduction in military expenditure has been due to the grant which this country is making—some £1,500,000 towards the military expenses of India.
  While we are entitled to take note of this state of affairs in the Central Government, we must also, when we are considering the Bill on its merits, consider the state of affairs in the Provinces as well, because it is in the Provinces that I imagine the bulk of the servants affected by this Bill work, and on whose budgets the incidence of the salaries fall. The hon. Gentleman has rightly called attention to the case of Bengal, and there is the case of Burma, whose budget, I think, has a huge deficit, and for the balancing of which recourse has had to be made to borrowing. I think that in connection with the Bill itself, so far when this matter has been discussed we have considered the general principles underlying it, and we have not concerned

  1673
  ourselves, so far as my memory serves me, with the contents of the Bill.
  It is an insignificant enough looking Bill of two Clauses. The second does nothing more than call attention to the contents of the Bill itself, but there is one thing in connection with Clause 1 and the Preamble to the Bill, to which I would like to draw attention. The Bill refers entirely to the question of pay. If I may be permitted for a few moments, I would like to explain what the general term "pay" means in India. It is not quite the same as it is in this country; in fact, the pay of the public servant in India may consist of one, or it may consist of three or four types of pay. In the first place, you may have an officer who is drawing only one pay, a basic rate of pay. Then you may have another officer who, in addition to this basic rate of pay, is drawing extra duty pay for some duty on which he may be employed. You may also have another officer who, in addition, will be drawing staff pay, so that it is frequently the case that an officer may be drawing three types of pay for appointments which he may be holding which would all come within the meaning of the term "pay" in this Bill. That generic term includes these three elements of pay.
  There is, however, another aspect which affects this question materially, and that is the aspect of allowances, which the great majority of officers in India draw. There is, in the first place, the question of marriage allowances, which are paid to officers 30 years of age and over. Then there is the question of lodging allowance, which is payable to all officers, whether married or single, except in the case of those who are provided with quarters. There is also another form of allowance, which, I think, is payable almost exclusively to those who are stationed in the great Presidency towns which represents a compensatory allowance to provide for the great increase in cost of living which prevails in those cities. So that, in addition to the pay pure and simple, nearly everyone is affected by one or other, or perhaps all, of the allowances which I have enumerated, and, in fact, those allowances are not part of the pay at all. They are recognised in the financial
  1674
  instructions of the Government of India not to be part of pay. Pay includes basic pay, staff pay and extra duty pay, but it does not include allowances such as those which I have mentioned.
  The point I wish to make is that, under the provisions of this Bill and the corresponding enactments in India on which this Bill is based, the abatement in pay has been applied not only to pay but to these allowances as well, and although I am not a lawyer, I have been long enough in this House to realise that most Bills that are introduced mean something quite different from what they say, and I would like to ask the right hon. Gentleman if it is the case that, under the terms of the Bill, allowances do not come within the provisions of the Bill. If I am right in this, some Amendment will obviously be necessary in the Committee stage.
  There is one other point I would like to bring to the notice of the right hon. Gentleman. With regard to the compensatory allowances which are paid for the increased cost of living not only to civil but to military officers, while that allowance has been subject to the 10 per cent. cut up to last year, in spite of the fact that the Bill of last year reduced the cut from 10 to 5 per cent., the higher rate of 10 per cent. was applied to the Rangoon compensatory allowances at any rate up to October of last year, and refunds have only just been made. I recognise, of course, that that is an administrative error. At the same time, I would suggest that, in view of the fact that every rupee is needed by these officers, it is an error of a somewhat careless nature, and perhaps the right hon. Gentleman will be good enough to bring it to the notice of the requisite authority. There is nothing further I wish to say except that I agree with all that the hon. and gallant Member for Chippenham (Captain Cazalet) said in regard to the difficulties under which officers are serving, but I recognise that the Bill is absolutely necessary, and, in consequence, I shall support it.
  4.12 p.m.
  Sir REGINALD CRADDOCK: I have very few observation to make, as the year before last and last year I said all that could be said from my point of view as a retired member of one of the Services. I only hope that this Bill, which, I am afraid, shows signs of becoming a

  1675
  hardly annual, will at least after this year fade away, and that these cuts which the Services have suffered will then be restored. There is, however, one point which I would like the right hon. Gentleman to make clear in his reply. Last year, on the day that the second Bill was in the House for Second Reading, I received a telegram from the Services Association to the effect that the Madras Government had restored the cuts. I have never yet heard whether that was actually the case or not, but it does raise one issue upon which a reply by the right hon. Gentleman would, I think, be very useful. The point I wish to make is this: Does the restitution of these cuts depend upon the finances of the particular province in which the officer is serving, or does it depend upon the condition of the Central Government? All these officers whose pay has been cut are of an all-India Service, and therefore they have a claim upon the Central Government which does not equally apply to those officers who belong to provincial Services.
  On the other hand, if the test is whether the particular province in which the officer is serving can afford to restore the cuts, then it seems to me that the position may become one of difficulty, because the province concerned has imposed the cuts on provincial and subordinate Services, and while the rest of India may be sufficiently flourishing to have the cuts restored, the officers in that particular province may be subjected to this constant reduction in their salaries on the ground that that particular province cannot restore them to their former position. I should very much like that point to be elucidated by the Secretary of State. For the rest, I know—and the speeches that have been made to-day confirm it—that the House views with sympathy the position of these Services and recognises the loyalty with which they have sustained this continued reduction in their emoluments, as has been explained, at a time when, to them at least, the cost of living has risen rather than fallen. The Services will, therefore, appreciate the feeling of the House in respect of their interest and of the loyalty with which they have continued to carry out their duties.
  4.16 p.m.
  Mr. BUTLER: I rise with the permission of the House to answer, quite shortly, the points that have been put by the hon. Members who have taken part in the Debate. I notice that all hon. Members who have spoken share the regret of the Government that these cuts have been continued, and, therefore, I may take it that the House will agree that it is only with regret that we are obliged to consider this Measure. The hon. Member for the English Universities (Sir R. Craddock) raised a specific point to which he desires an answer. The position in Madras is that the cuts on the Provincial services have been restored. The all-India services all over India are treated in exactly the same way. The hon. Member said that he hoped that this matter would be gone into and also that it would not be necessary to introduce this Bill again another year. We certainly share his last wish, and if the Bill is not introduced again, we sincerely hope that difficulties such as he mentioned will not become acute. I think it is impossible at this stage to lay down any general principle, except to repeat that the members of the all-India services in India, as I said in my original remarks, are treated alike in this matter, and that the position does not depend on the exact financial position of each particular Province.
  The hon. and gallant Member for the Ardwick Division of Manchester (Captain Fuller) raised some points about pay and the question of what pay actually means. He is steering into rather deep water when he wishes us to consider all the intricacies of the definition of pay, compensation allowances, and so forth, of which he is himself so great a master. I would only say that I understand that compensatory pay, both civil and military, is not cut, but that duty pay and all that that entails is cut. That is the position, broadly stated, and I think that on this occasion of the Second Reading it would be wiser to leave the matter in that sense. The hon. and gallant Member for Chippenham (Captain Cazalet) raised precisely the sort of difficulties which I envisaged in my original remarks, and I fully sympathise with all that he said about the difficulties which some of our officers in India have, to make both ends meet. It is for these reasons that we particularly hope the position will be such next year that it will not be necessary to

  1677
  reintroduce this Measure. With these few remarks, I sincerely hope the House will allow us to have the Second Reading of the Bill.
  Bill committed to a Committee of the Whole House, for Monday next.—[Sir S. Hoare.]

  SUPPLY.
  Considered in Committee.
  [Sir DENNIS HERBERT in the Chair.]

  INDIA OFFICE AND SERVICES.
  Motion made, and Question proposed,
  "That a Supplementary sum, not exceeding £1,501,100, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for a Contribution towards the Cost of the Department of His Majesty's Secretary of State for India in Council, including a Grant-in-Aid, and a Grant-in-Aid of the defence of India."
  4.21 p.m.
  The SECRETARY of STATE for INDIA (Sir Samuel Hoare): This Vote deals with very complicated questions that have for half a century imposed an immense amount of work upon Whitehall and Delhi and that have excited suspicions and recriminations that ought long ago to have been allayed. The questions that are covered are not only controversial, but they are very intricate, and, this being so, I think I had better give the Committee as clear a picture as I can of the main features of the problem. They will bear with me, I feel sure, if I deal at some length with these questions. As I say, they are very intricate, and, unless the Committee fully understand them, they will fail to follow the effects of the award of the tribunal.
  Two principal issues emerge from the mountains of detailed controversy that have been piled up behind this question. The first is the issue of the so-called capitation grant, and the second is the issue of the Imperial contribution to India. I will take these two issues in order and begin with the capitation grant. The capitation grant is the
  1678
  amount paid by India to the Imperial Treasury, for what are called the home effective charges in respect to British troops serving in India. India, it will be remembered, pays the entire cost of its own military defence, including the maintenance of all units, British and Indian, serving in India. The figure of this expenditure is about £35,000,000 a year, as compared with a total Budget expenditure of £92,000,000. But the cost of the maintenance of the Indian garrison does not complete the Indian obligation. India pays the full cost of the British units, and obviously account must be taken not only of their maintenance in India, but of the proportionate cost due from India for their subsistence, training, and equipment in Great Britain. These are known as the home effective charges, and in recent years they have been paid at a rate of about £1,500,000 a year. The first question to be decided is whether the payment of £1,500,000 a year is a fair payment or not. The second main issue cannot be dissociated from the first. Should or should not an Imperial contribution be made towards the cost of Indian defence, owing to the advantages which Great Britain obtains from the existence of the Army in India? The claim has been made that these advantages are so considerable as to wipe out, and more than wipe out, the Indian obligation to pay for the home effective charges.
  The Committee are now, I hope, in possession of the two main questions in controversy. Let me give them in a few sentences the history that led up to the appointment of the tribunal to settle them. For 40 years or more there has been an interminable controversy as to the fairness of the capitation figures. Some of the best brains in Whitehall and Delhi have devoted their rival ingenuity to calculations as to what exact percentage of recruiting and training expenses ought to be charged to the British and Indian Treasuries. An almost metaphysical battle of words has been joined on these complicated and sometimes imponderable issues. As long ago as 1896 Lord Welby's Commission on the finances of India attempted to solve the question, another committee under Lord Justice Romer in 1907 made a similar attempt, while since the War, when new complications were added to the controversy, there has been a continuous and con-

  1679
  certed demand from Whitehall to get the question finally settled. I am glad to see my right hon. Friend the Member for Epping (Mr. Churchill) in his place. I feel sure that he has come down to support whole-heartedly this Vote, but I think I shall be right in saying that he himself, whether as Secretary of State for War, whether as Secretary of State for Air, or whether as Chancellor of the Exchequer, took constant interest in, and was throughout his long period of Ministerial responsibility strongly in favour of, an arbitral decision.
  Mr. CHURCHILL: I shall be very glad if the right hon. Gentleman will refresh my memory on that point. I have always been opposed to the reopening of this question, from the Exchequer point of view.
  Sir S. HOARE: My right hon. Friend, of course, will correct me if I am misstating his position, but surely—it is a fact of public knowledge—it was when he was Chancellor of the Exchequer that the decision was taken and that the offer was made to the Government of India to refer these questions to a tribunal for decision.
  Mr. CHURCHILL: No. The case then was exactly the reverse of what has now taken place. The War Office claimed that India was not paying a sufficient charge, and, a prima facie case being established to the satisfaction of that Cabinet, the matter was referred to Lord Cave, who gave his opinion thereupon.
  Sir S. HOARE: I hope my right hon. Friend will refresh his memory. I think, if he does so, he will find that there were two questions at issue. There was the question at issue connected with the sea transport charges for the Army. That was certainly referred to Lord Cave's arbitration, but there was the wider question of the capitation grant and, connected with that, the wider question of the Imperial contribution. I feel certain that if my right hon. Friend will refresh his memory, he will find that it was when he was Chancellor of the Exchequer that the decision was taken, with his full approval, to refer, not the issue of the sea transport question—an issue that had been referred already to Lord Cave—but the two broader issues of the capitation grant and the Imperial contribution. Perhaps he will deal at greater length with
  1680
  that question when he comes to address the Committee later on. I was certainly under the impression that, so strongly was my right hon. Friend in favour of this action, the tribunal would actually have been set up before the Government of which he and I were Members went out of office, but for the unfortunate state of affairs which resulted in hon. Gentlemen opposite coming into office in our place.
  Then came a period of the Socialist administration. There again, so far as I can judge from the papers, there was a unanimous desire in both the Service Departments and the Treasury, and in the Government as a whole, to get these difficult issues settled by an arbitral body. I understand—and I hope I shall be corrected if I am misstating the position—that the tribunal would actually have been set up had it not been for the fact that the Statutory Commission presided over by the Foreign Secretary was on the point of reporting, and it was felt that the Government before taking action had better wait to see how far the report of that commission reacted upon the issues of the capitation grant and the Imperial contribution. I come now to the ground for which I am most responsible, namely, the time when I went to the India Office during the first National Government. There I found this general demand from Whitehall and the general acceptance in India of the contention that this question had much better be settled by an impartial arbitral body, and I immediately took what action I thought necessary to set up as strong and as impartial a body as I could possibly find anywhere in this country or in the Empire.
  I hope that the Committee will agree that the Government were not unsuccessful in setting up a very strong tribunal. The chairman of it was one of the most distinguished Empire and constitutional lawyers in the Empire, Sir Robert Garran, formerly Attorney-General of Australia. The British representatives were two of our most highly respected Law Lords, Lord Dunedin and Lord Tomlin, and the Indian representatives were two of the best known and highly respected Indian judges, namely, the Chief Justices of Lahore and Allahabad. The tribunal went with great care into the two main issues and the details surrounding them. I tell the Committee without any breach of confidence that the British and Indian cases were exhaustively argued by some of the ablest

  1681
  barristers in Great Britain. It is all the more satisfactory to note that the tribunal was unanimous—that is to say, the Australian chairman, the two British judges and the two Indian judges—upon the two main issues. As to the capitation grant, they unanimously agreed upon a business-like formula that has been accepted by the Service Departments in London and by the Government in India. This formula, put shortly, means that the War Office will in future receive somewhat less than they received in the past from India, and that the Air Ministry will receive somewhat more, and that the gain and loss, generally speaking, will balance. In view of the unanimity of the tribunal and the general acceptance of this part of the award, I do not think I need delay over the complicated details. Hon. Members will find them set out very clearly in paragraphs 25 to 64 of the report of the tribunal.
  The Committee will, however, wish to hear more about the first part of the award, namely, the part dealing with the Imperial contribution. The tribunal was required to examine India's claim that a contribution should be made from Imperial revenues towards the military expenditure from Indian revenues, and to report the basis upon which any contribution should be assessed. The tribunal came unanimously to the conclusion that India's claim to a contribution must be accepted. As to the basis on which any contribution should be assessed, there was a difference of opinion between the two Indian members of the tribunal and the rest. The majority, that is to say, Sir Robert Garran, Lord Dunedin and Lord Tomlin, came to the view, to quote their own words, that
  "the grounds in respect of which a contribution should be made are the following two only:

  (1) That the Army in India is a force, ready in an emergency to take the field at once, which does not exist elsewhere in the Empire, which is specially available for immediate use in the East, and which has on occasion been so used.

  (2) That India is a training ground for active service such as does not exist elsewhere in the Empire."

  The two Indian members of the tribunal, Sir Shadi Lal and Sir Shah Sulaiman, while
  "concurring with the two grounds stated above, think that certain further grounds should be added which in their opinion would
  1682
  very much broaden the basis of the contribution."
  The Committee will therefore see that there was unanimity in the tribunal as to India's claim for a contribution, but a difference of opinion as to the factors to be taken into account in the assessment. When, therefore, it came to recommending an actual amount, the tribunal refrained from any specific expression of opinion.
  Mr. CHURCHILL: Will my right hon. Friend explain, because this is very important? This £1,500,000 is not the award of the tribunal. It is the action taken by His Majesty's Government after having read the report of the tribunal.
  Sir S. HOARE: If my right hon. Friend had allowed me to finish my statement, he would have seen that that is a part of the question to which I am now coming, and before I sit down I think he will see that have made the position as clear as I can. It devolved in fact, as my right hon. Friend has presumed, upon the British and Indian Governments to enter into a discussion as to the amount, the amount not having been laid down by the tribunal. Here, obviously, there was a wide field for difference of opinion. On the one one hand there was the Indian claim made upon a variety of contentions. I will give the Committee two or three instances illustrating India's point of view—that contributions should be based upon a fixed percentage of India's total expenditure on defence, say, one-half, or about £18,000,000 per annum, a figure suggested by some members at the first Indian Round Table Conference; or, alternatively, some lower percentage; or, again, the extra cost of maintaining the British troops in India over the cost of maintaining a corresponding number of Indian troops, a figure estimated at £10,000,000; or, again, the existing defence expenditure of India relating to the cost of British troops, say £16,000,000, or, alternatively, a percentage; or, lastly, the excess of Indian defence expenditure over a certain percentage of Indian assessable revenue. These are illustrations of the points of view expressed by certain sections of Indian opinion.
  I come now to the case put forward from certain sections of British opinion. There was the view represented before the tribunal on behalf of the War Office

  1683
  and the Air Ministry that, so far from any contribution being due to India, the amounts already paid by India were inadequate. In between these rival claims emerged the unanimous view of the tribunal that account must be taken, first, of the actual help that India has been able to give in the past in Imperial emergencies and is likely to give in future; and, second, of the practical value of India as a training ground for British troops. In assessing these claims, it should be remembered that an expert inquiry into the problem of Indian defence in 1931 had come to the conclusion that military forces in India are maintained on a basis no greater than is required for the defence of India and the maintenance of internal security, and that they are adequate for this purpose but cannot be reduced.
  Accepting this conclusion—and the Government does accept it—there is no reason to doubt that the Government of India will be willing and able to assist the home Government in the future as in the past. The effectiveness of the help given by India in the past—in the Great War for instance, India contributed over a million men—cannot be questioned, but the help must be subject to conditions that have always prevailed as to the ability of India to spare help on any given occasion. It will be seen from this general description that in both the Indian and the British case there are several imponderable facts. The British Government, therefore, came to the view that it was impossible to draw up an exact balance-sheet setting out item by item the figures of an Imperial contribution. They took rather the main factors into account, namely, the great value to Great Britain of an army ready in any emergency to take the field at once and of India's habitaual readiness to help in times of emergency; and the value of India as a training ground not only for the regimental units of the British Army, but for the whole of our military machine.
  Taking these facts into account, the Government decided that in their view a contribution of £1,500,000, including what is called the sea transport subsidy, was a fair sum. I hope I have said enough to justify this Vote. I claim that a very strong tribunal has made an award founded, as the members of the
  1684
  tribunal themselves say, on justice and not on generosity, on merit and not on politics, and on the axiom that defence is not a luxury but a necessary protection, particularly for India, and has to be paid for; and I claim that it is an award that, in their words, is a fair, just and equitable settlement. I claim, further, that the sum of £1,500,000 conforms both in the spirit and the letter with this award. I greatly hope that whilst the award, in the nature of things, does not give full satisfaction to either party, its substantial justice will end a long and unfortunate controversy, and will dissipate suspicions and recriminations which have been rife for the last 50 years.
  4.46 p.m.
  Major MILNER: I am sure the Committee have noted with pleasure the return of the right hon. Gentleman the Secretary of State and are pleased to see him in good health once more. We are further indebted to him for the explanation he has given of this Supplementary Estimate, but there is one matter to which he did not refer, though to me it seems a very important one. The whole of the sum which we are now asked to pass is in respect of military expenditure, but we are at present discussing a Civil Vote, "India Office and Services," and I think I ought to ask your ruling on this point, Sir Dennis. Presumably military expenditure ought to be borne upon the War Office Vote, and I think I am right in saying that the £130,000 in the amount now asked for has in the past been so borne. I desire to ask how far it is competent for the Government to put military expenditure under a Civil Vote.
  The CHAIRMAN: To the best of my knowledge and belief it has always been the practice for Indian military expenditure to be dealt with under the India Vote. The particular item to which the hon. and gallant Member refers was in the nature of a contribution, as I understand it, in respect of War Office expenditure to the Indian Government, and that is why it appears as a payment by the War Office, but that is quite a different matter from a contribution which will come under Indian expenditure.
  Major MILNER: May I deal with the item of £130,000 a year? As I understand it, that is a contribution which for many years past has been made by the British Government to the Indian Government in part payment—one half, I think—of the transport charges of troops from this country to India. Hitherto, that has been borne on the War Office Vote. It is now sought to place that particular item, with the additional sum of £1,500,000, on the India Vote, and I call attention to the fact that this Vote is headed "India Office and Services." I think I am right in saying that hitherto it has been headed only "India Office," the words "and Services" being added presumably to seek to cover this particular point. In my submission it is not in order, without the permission of this House, for the Government to put a matter of military expenditure on a civil Vote.
  The CHAIRMAN: The hon. and gallant Member is mistaken. The arrangement of these accounts is a matter for the Executive Government and not for the House at all.
  Mr. MORGAN JONES: I understood you to say a few minutes ago that you rather held that this was in accordance with past practice. May I submit that this £1,500,000 is now being paid as a result of an arbitration held some time ago. This £1,500,000 now falls to be found by Britain because, as I understand it, the tribunal deemed the services provided for by the £1,500,000 to be in respect of Imperial Defence and not specifically Indian Defence. The point which my hon. and gallant Friend puts to you is whether, since this is in respect of Imperial Defence and not specifically Indian Defence, it ought not to be on the War Office Vote rather than on the India Vote.
  Mr. MOLSON: Is it not a fact that the arrangement of the Estimates depends upon what Minister is responsible for the expenditure of the money, and that the expenditure on Indian defence comes under the Secretary of State for India and not under the War Office?
  The CHAIRMAN: The arrangement of the form in which the Estimates are presented to the House is entirely a matter for the Government, and not for this House.
  Major MILNER: I accept your Ruling, Sir Dennis, but I think this is a matter which calls for extremely strong comment. Hitherto the sum of £130,000 has come under the War Office Vote and has been paid by the War Office. In the future that sum is to come under the India Office, and to that extent the expenditure of this country on imperial military matters will be reduced; and similarly in regard to the sum of £1,500,000. If, as in my submission would have been the proper course, that sum had been borne on the War Office Vote that Vote would have been by so much increased, and the step now taken by the Government leads to the whole position being disguised, so to speak, and to a contribution being made to military expenditure by the Government of this country which is not going to be shown on the War Office Vote. I quite agree that this is not going to involve an increase in armaments to the extent of £1,500,000, but it will present a false position to the country and the world as to the amount being found by this country for Imperial military expenditure. I know that my party feel strongly that this is an expenditure which ought to be borne on the War Office Vote and not brought in by a subterfuge on an India Office Vote headed "India Office and Services," the words "and Services" being apparently inserted to cover the precise point I am putting before the Committee.
  I would draw attention, further, to the note on page 16 of the Supplementary Estimate to the effect that the expenditure will not be accounted for in detail to the Comptroller and Auditor-General. I would ask my hon. Friend the Financial Secretary to the Treasury how it is going to be accounted for, and by whom, and what information will be put before Parliament year by year regarding this expenditure, because I take it there is no question that this sum of £1,500,000 will be a recurring item year by year, that we have now decided—I do not know whether for all time, but certainly for the present year—to make this contribution from Imperial revenues towards military expenditure in India.
  On the general question of the Estimate, while we have had a somewhat long and, so far as it goes, clear statement from the right hon. Gentleman he really has not told us precisely how the

  1687
  sum of £1,500,000 has been arrived at. He spoke about imponderable things, and so on, but surely there must have been something in the minds of the India Office and the War Office in arriving at this sum. The tribunal were unanimous in the decision or the recommendation that a contribution should be made from Imperial revenues to this military expenditure of India. It is true that they added that it was in respect of certain limited matters only. The right hon. Gentleman quoted from the Committee certain formulae which had been submitted to that tribunal by the India Office, but he did not indicate which, if any, of the formulae had been adopted or on what basis this sum had been arrived at. It seems to me it has been arrived at purely at large, on a sort of rule of thumb arrangement between the War Office and the India Office.
  I do not know how far authorities in India were consulted. We are not given information on which we can judge whether the sum is too large or too small. It may be that some of us think it too small, but, whilst I am not dogmatic on the point, I am inclined to think that, on a fair construction of the whole of the facts in the tribunal's report, it is probably too small. However, we are not given information on which to judge, and I hope the right hon. Gentleman will be more precise and indicate to us the basis on which the sum was arrived at. Or was it merely a bargain come to between the War Office and the India Office under which one or the other has given way? The sum bears no relation to any of the much larger sums mentioned by the right hon. Gentleman or appearing in the tribunal's report, and we shall be glad of information in a more precise form than has hitherto been vouch-safed to us. I would like to ask in particular if and to what extent the training of recruits has been borne in mind by the Government. The report of the tribunal puts the matter in this form:
  "The question at issue is: who shall pay the cost of the recruit's training. The answer, we think, is: the country in which he gives his service; and, if he serves in both, then both countries on a 'time' basis. We think that the whole of his normal service—with the Colours and in the Reserve—should be counted for this purpose."
  To what extent has that recommendation be borne in mind and what portion
  1688
  of the £1,500,000 is attributable to the training of recruits? The Committee are surely entitled to some information on that point. Then, something was said by the right hon. Gentleman regarding the contribution of £130,000, which he referred to as the sea transport contribution, a contribution made by the British Government for a good many years in respect of the transport charges of soldiers proceeding from this country to serve in India. One would have thought that that sum of £130,000 would have been included in the Estimate in addition to the round sum of £1,500,000. It seems curious that the arrangement or agreement should be for a round sum of £1,500,000, and that that sum should be held to include the sea transport contribution of £130,000. It is understood that we have to make a contribution of £1,500,000. As one versed in the law, I approach the matter in an endeavour to obtain satisfaction for my client, and I naturally desire to have all the items in. I should be glad to know—I am sure that the Committee would also welcome the information—how it comes about that the sum of £130,000 is apparently included in the agreed total contribution of £1,500,000.
  The only other question I desire to put to the right hon. Gentleman is as to whether the Committee are to understand that this contribution is now more or less fixed by agreement for all time, or whether it is subject to reconsideration year by year. The right hon. Gentleman pointed out that the question of the claim made by India to a contribution from Imperial revenues towards her expenditure had been a source of constant trouble for the past 40 years. The Government are to be congratulated that at long last they have come to some sort of conclusion in regard to it. It is impossible for us to decide whether this is to be considered a satisfactory settlement, since we have only the information vouch-safed in the statement which is before the Committee and in the remarks of the right hon. Gentleman. The tribunal to which representations were made unanimously held that it was right and just that a contribution should be made from Imperial revenues, and it is obvious that during the whole of the 40 years India has not received the contribution which has now been held to be fair and just. I presume that the Government

  1689
  will say that that is now a matter of history, but it is a fact which ought to be borne in mind by the Committee in discussing the question. I wish to ask how far this settlement is a final one.
  5.3 p.m.
  Mr. CHURCHILL: I beg to move to reduce the Vote by £130,000.
  I cannot feel that there is any very great validity in the complaint of the hon. and gallant Gentleman that this new charge of £1,500,000 a year is to be included on the Army Vote, and the explanation he gave of his grievance certainly made the worst possible out of it. What is the object of the hon. and gallant Gentleman? He would like to add £1,500,000 to the accounting of the Army audits, so that he and his friends can point to the terrible increase of military expenditure and to the bloated armaments which are rolling up at a time when all the world is seeking for disarmament, knowing all the time that, whatever way you look at it, it is merely a matter of bookkeeping.
  Major MILNER: On the contrary. I pointed out that it did not matter on which Vote this sum was put, because it would not result in an increase of armaments. I made that perfectly clear, and the right hon. Gentleman the Member for Epping (Mr. Churchill) is quite wrong in his interpretation.
  Mr. CHURCHILL: Nothing could be more misleading than to increase the nominal total of the Army Estimates by this £1,500,000 a year. The Government are justified in being candid with the public, but it is perfectly clear, as the hon. and gallant Gentleman admits, that it in no way involves an increase of armaments of any kind. I am very glad to see my right hon. Friend the Secretary of State for India in his place. I trust that he has not unduly strained the permission of his medical adviser by coming here. I very much regret if, in the course of my remarks, I should be involved in controversy with him, and he should not be in the very best of health. My right hon. Friend sometime ago accused me of hitting the Government and hitting its Members. I can assure him that that is a complete delusion, especially in his case. It is not the sinner that I hit but the sin. That rule is general in his case, on this as upon other matters.
  1690
  The right hon. Gentleman had no right to try to claim me as a supporter of his policy in this matter. I notice that His Majesty's Government are inclined to claim my protection from time to time. Even the Prime Minister seemed to go out of his way to drag me in when I was sitting most inoffensively in this corner. I cannot accord to my right hon. Friend the protection that he desires in this matter. We have been associated for many years, and he must know perfectly well—though I am not entitled to make any relevation in regard to those days any more than he is to refer to my opinions of those days—that he has heard me on many occasions and in different places express consistently, over many years, the view that the balance of charge between India and the War Office was unfairly adjusted against this country. That has been the view that I have consistently held for a great many years. To suggest that the Chancellor of the Exchequer, or any Chancellor of the Exchequer in the last 25 years, would have been responsible for putting down a vote of £1,500,000 for a new grant-in-aid for India in perpetuity—and to do so in these hard times of crushing taxation and grinding economy—is altogether at variance with the known facts and with the ordinary processes of human reason. The right hon. Gentleman must stand on his own feet in this matter.
  I make no complaint of the particular form of the tribunal, though I am certainly not saying that it was a wise thing to set up this tribunal. We are not concerned with the tribunal—or only very indirectly. It is not an award as the right hon. Gentleman says; it is a report. It is not an award of a judicial tribunal by which we are bound; it is a report of a body of gentlemen, a committee of very able gentlemen, to the Government, and on their report the Government have decided to take £1,500,000 per year out of the pockets of the taxpayer and to present it to the Government of India. I am certain that that would never have been allowed and would never have been agreed to by any of the Governments which have held office in the last 25 or 30 pears. We had discussions following upon the Welby Commission and the Romer Commission. There were long discussions between Lord Haldane and Lord Morley, which I perfectly remember, in which the matter was threshed out in

  1691
  great detail by men whose Liberalism and whose desire to deal equitably with India were undoubted. They arrived at what they considered to be a fair working arrangement.
  During the recent Conservative Administration the late Sir Laming Worthington Evans, who was then Secretary of State for War, felt very acutely the injustice to which the British taxpayer was subjected by the cost of maintaining the service of the Indian Army, and he pressed very strongly upon the Government of that day that there should be an inquiry into one specific point, the question of sea transport charges. That was agreed to, the matter being raised on the initiative of the War Office. That fact shows that the Government of the day felt, as I know that they did, that there was a prima facie case for the diminution of the burden on the British taxpayer in respect of Indian Army costs. So far from the right hon. Gentleman quoting that as a means of trying to bring me to his rescue, and to cast my aegis over his manoeuvres, if it proves anything, it proves the reverse of what he set out to show.
  I want to make it clear that Parliament is free to decide in this matter. The Committee have an absolutely free hand. We are not dealing with a judicial award, but with a proposal put forward by a Minister of the Crown, on the responsibility of our own Government at home, to add to the public burden. This is a matter in which the Committee ought to take some interest. The Chancellor of the Exchequer is distributing his surplus very early this year. I hope that it is a very large and ample surplus, but it is quite remarkable when we consider the conditions under which this Government were appointed, and the tremendous insistence upon ruthless economy at the time, that there should be so much money about, and that £1,500,000 can be pulled out and brought forward on an afternoon like this, not as an amount only for the year, but as a continuing service for all time. The figure may not be quite accurate, but I think that the capital value of that sum will represent pretty nearly £40,000,000. That is what we are asked to do, and we ought certainly to look into it very carefully. I am very glad that the hon. and gallant Gentleman
  1692
  opposite has taken interest in it. Public money ought not to be splashed about in this manner without very grave, just and searching examination by this Committee of the House of Commons.
  I have read the able report of this able committee—or tribunal if you like to call it, but it is no more a tribunal than any other committee similarly appointed to make recommendations—to the Government about this question. It seems to me that the committee were very hard put to it, to find any reason for an increased contribution from Great Britain with respect to the British Army in India. On pages 8 and 9 of the report they give an account of their search for some reason, and apparently they looked at a great many promising resting places for their argument, but, upon consideration, they found that one after another would not bear the weight of any conclusion. It is not until we get to page 15 that they have at last found a foothold for this new imposition upon the British taxpayer. I hope that the Committee will look at page 15. When tribunals give decisions and do not give reasons, it is very difficult for anyone to form an opinion. But, when a tribunal or committee gives its reasons, even ordinary laymen can form their own views on them. Just let us look at the two reasons which are given on page 15. My right hon. Friend read them, but they are very important, and, if the Committee will bear with me, I will read them again. They are:

  "(1) That the Army in India is a force, ready in emergency to take the field at once, which does not exist elsewhere in the Empire, which is specially available for immediate use in the East, and which has on occasion been so used.

  (2) That India is a training ground for active service which does not exist elsewhere in the Empire."

  I do not say that there is nothing in these two statements, but there is not very much, and to a large extent they are not true. Take the first—that the Army in India is a force ready in an emergency to take the field at once, which does not exist elsewhere in the Empire. That is only true in the sense that the British troops in India are up to full war strength, whereas in this country it is necessary to call out the reserves in order to mobilise our battalions and other units. Apart from that, it is not true to say that the troops in India are more readily

  1693
  available or are ready in an emergency to take the field at once, because, if you consider the time it takes to prepare transport, the probably much quicker location of masses of shipping in this country, and the need for furnishing special equipment in India for the various contingencies that might arise, you would not find in many cases that they would be ready any sooner, or even, possibly, so soon. Certainly they were not ready so soon in the great instance that we had in the Great War, when our Expeditionary Force had been fighting for, I think, two months before these excellent troops from India could be brought on to the scene. This first of the two reasons, therefore, on which £1,500,000 of British money is to be expended, is really capable of considerable canvassing and modification in regard to its validity.
  As regards the second reason—that India is a training ground for active service which does not exist elsewhere in the Empire—again I do not wish to underrate the manly and gallant life of our troops on these vast plains of India, but I doubt whether you can say that experience in frontier wars is any special guide in, shall I say, the great struggles of the Continent of Europe. I remember often hearing the late Sir Charles Dilke argue to the contrary, and point out how, in the war of 1870, it was considered that the French suffered by having such a large proportion of Colonial generals who had been advanced from small fightings in their Colonial possessions to high positions in the Army, instead of having men at the summit who had based their views on broad scientific study of the greatest operations of war. And the Germans, let me point out, had no India, they had none of this advantage of training their troops on a great training ground such as India. Their Army was entirely a home-trained army, trained in Europe; and I have yet to learn that they did not give a very good account of themselves in the Great War. Certainly, judged by the most awful and unanswerable test, they killed between two and three men for every one of themselves who was killed, and that without any of the advantages detailed in the second reason for which we are invited to spend £1,500,000 a year for all time.
  These are fairly flimsy pretexts, found after such a very long search by this
  1694
  very able Committee, considering the burden which is to be placed upon us. At any rate, whatever you may think of these reasons, there is nothing new in them; there is nothing in these two proposals which has not been perfectly obvious and well known and recognised as common ground for the last 30 years in all the endless discussions between the India Office, calling itself India—"she"—and the War Office; in all those endless discussions these facts have been perfectly well known. Why should they now be given such extraordinary prominence at the present time? That is the question that we have to investigate. Before I attempt to do so, I would like to say that against these two reasons which are given on page 15 there are other considerations which might well be studied if you are going to survey the whole relationship of the British Army in India to the Exchequer and the English taxpayer. If you are going to do that, there are other considerations which far outweigh the two set forth here. I will mention two of them to the Committee now, neither of which is referred to at all in the report. I am astonished that the representatives of the War Office did not bring them to the notice of the Committee, if in fact they did not.
  To begin with, the first great consideration which must be set forth is the enormous effort and sacrifice imposed upon the British nation in maintaining an army of 60,000 men permanently under the conditions of life and service in India for generation after generation. That is holding out the dumb-bell at arm's length; it is a tremendous strain. A seven years' slice is taken out of the lives of these young men. You call it short service, but by every standard in Europe it is a very long service. Seven years are taken out of their lives, some five of which are passed under all the fierceness of the Asiatic sun, they are exposed to the trying effects of the Indian climate, and they are exposed to the temptations which naturally follow to young soldiers in that country. As we well know, the statistics of venereal disease and the general effects upon our young men sent out to serve in the Army in India are by no means negligible. I do not wish to put it too high; I make great acknowledgment of the efforts

  1695
  which have been made to improve the hygiene and conditions of the troops; but to suppose that you are not subjecting a body of 60,000 of your men, the flower of your youthful working-class manhood, to a long strain, and taking from them five or six years of the time during which they might be fitting themselves into the industrial field, to suppose that you are not taking from these men's lives something which is extremely important and which they may never get back again, is altogether to underrate the character of the effort which Britain makes to maintain an army in India.
  It is our duty to make this effort, because, if we did not do so, if we did not maintain this Army in India, India would fall immediately into anarchy and civil war, and, after a brief period of turbulence and disorder, the probabilities are that history would see another conqueror, either from across the seas or through the mountains. [Interruption.] I will not pursue the topic further, except to submit to the Committee that this great strain and effort made by Great Britain for so many generations to preserve the peace, order and security of India should count at least as an equal, and I consider as an overriding, consideration to match against this second item that India is a training ground and that they get good practice at manoeuvres out there.
  Let us look at the next consideration. We could, of course, have a very much cheaper military arrangement if we had only ourselves to consider. I remember often hearing Sir Charles Dilke explain the great advantages that would accrue to our military system if we divided the Army, making India pay the whole cost of a long-service Army for India, while we ourselves had a short-service Army here, with, we will say, two years with the Colours and 10 in the Reserve. Such an Army would rapidly build up a very large, flexible, homogeneous force at no greater, and probably at a less, cost than we are now put to by having to adopt the system of seven years with the Army and five with the Reserve. It is a great mistake to suppose that our Army arrangements are not gravely complicated and burdened, as anyone who has studied the matter knows them to be, by the need of rendering this great service
  1696
  to India; and I think that this second counter-consideration ought to have been placed against, and might well be placed against, the reason of the Committee that we have some troops there ready in an emergency. I say that there is not much validity in either of these reasons, that there is nothing new in either, and that undoubtedly far stronger points can be raised on the other side.
  Then there is the reservation on the last page, by Lord Dunedin and Lord Tomlin, on the question of sea transport. I agree with the hon. Gentleman that this is a matter well worthy of our attention. Here are these two great legal authorities, dealing, not with any of those imponderabilia which played such a large part in every sphere in which the committee worked; they are dealing with a question on which they are absolutely competent to express an opinion, namely, whether there is a case in equity and in contract for the continuance of the £130,000 subsidy in aid of sea transport. They both come to this conclusion:
  "We, therefore, though reluctantly.… are driven to the conclusion that there is no ground for the subsidy…."
  But that does not affect the Government at all. In this mood of generosity which has swept across them, and for which usually we search in vain, they have not hesitated to act against the opinion of these two eminent legal authorities dealing with a matter on which they are perfectly competent to pronounce. In order to bring matters to an issue, therefore, I propose, if it can be fitted in with any other Motion—I am not sure whether there is a Motion from the other side to reduce the Vote—to move to reduce the Vote by £130,000, in order to point out that the policy of the Government in this respect at any rate should be brought into line with the definite rulings of these two eminent Law Lords, who are themselves so friendly to the aspirations of India in other respects. If I get an opportunity, I shall also vote against the grant of £1,500,000 as a whole.
  To return to the question that I mentioned a moment ago, why His Majesty's Government decided to convey this new grant-in-aid to India, or rather to the British Government in India, at this particular time, no doubt we shall be told that it has nothing to do with the White Paper Constitution and nothing to do With the grave financial expense and con-

  1697
  fusion in which the attempt to extend the pleasures of democratic electioneering to the Indian masses is likely to involve the Indian Government. Those who wish to deceive themselves will believe that it has nothing to do with it. I am told that the right hon. Gentleman even referred to the possibility of money from this source in one of his answers before the Committee, but I have not the reference, and, if that is not so, I will stand corrected. We shall be told it had nothing to do with it, just as we were told that the retrocession of the Bangalore Cantonment had nothing to do with the desire to make Mysore into a federal system, or that the new arrangements made about the Nizam's sovereignity over the Berars had nothing to do with any desire to include that great Indian State in Federation. It seems to me, and I believe it to be true—I regret to say it—that this extra payment of £1,500,000 which is being engineered and might slip through the House without the public attention being drawn to it is part of that elaborate crochet work which my right hon. Friend, I am sorry to say, has too often mistaken for statesmanship. Let the Committee contrast this strange liberality with the attitude of the Government and the Treasury when the question is discussed of the difference between two and three shillings in the children's allowance. Then a very different mood prevails. Then the Government are adamant. Then the Chancellor of the Exchequer is the emblem of financial austerity.
  Something has happened in regard to the Indian matter which puts it in a different category, and I will tell the Committee what in my opinion has happened. When a Cabinet Minister gets into a difficulty with a policy on which the Cabinet is bent and to which it is largely committed and they do not see their way clearly through it, the money has to be found and the Chancellor of the Exchequer has to face the burden.
  "Not once or twice in our rough island story"
  the line of least resistance has been found through the pocket of the taxpayer. Do not let the Committee delude itself with the idea that this sop—for it is no more—is or will be accepted as a settlement. India, that national entity which you are endeavouring to call into being and the nucleus of the British
  1698
  bureaucracy will not accept it. You have only to see the proposals which the India Office put forward. Our Secretary of State hopefully put forward five or six proposals which would have added enormously to our charges. He put them forward as matters which should be considered so that, when it came to splitting the difference, there would be a very good chance of their getting a large slice of the money of the British taxpayer. Of course, what you are doink now will be brought forward by the Indian Home Rule Government as soon as it is constituted. They will say: "You have admitted the injustice. What about the arrears of all these years?" They will press not only for the different concessions which the Secretary of State and the India Office have put before the Committee. They will take these as a starting point and will press forward much larger demands, and that will be the first phase of the new Government when it is created. This is only the first heavy drop of the thunder shower. It is only the first of the deprivations and repudiations to which we are to be subjected if the policy to which my right hon. Friend is committed is carried out. If you have so much money as all this, if you are in such a giving mood, if you are resolved to persist in the policy of giving federal home rule to India, you should have kept this £1,500,000 a year carefully as a means of guaranteeing the pensions of the British officials who have so faithfully served you and served their country and whose anxiety you might so easily thereby have allayed.
  5.37 p.m.
  Earl WINTERTON: I have listened with the greatest interest to the right hon. Gentleman's speech. As one who is a great admirer of him as a student of military policy, I should like to have heard him elaborate more the interesting theories that he put forward on the subject of the training of troops. I think there is much to be said for the view which he attributed, rightly no doubt, to Sir Charles Dilke, though I seem to remember certain passages in his own writings, both in regard to India and to the River War in the Sudan, which to some extent conflict with the views of Sir Charles Dilke. The right hon. Gentleman, as is usual when the House or the Committee has the advantage of being addressed by him, has put forward what

  1699
  superficially, at any rate, appears to be a most powerful case, yet I believe there is a complete answer to all that he said. I will not attempt to make it in full. That is for the Government. The first question which arises on which the Committee is entitled to have the fullest discussion is the question whether or not the tribunal should ever have been set up and whether it was a proper instrument for deciding this question.
  The right hon. Gentleman has told us, confirming what was said by the Secretary of State, that this is a very old question. It goes back to years long before the War. He truly told us that he himself had in 1920 raised the question of the capitation grant. It was during the period of the now historical Government of which the right hon. Gentleman was a great ornament and I was a humble Under-Secretary—the Coalition Government of 1918. I believe it would not be possible without getting special sanction to quote any decision which the Cabinet readied, but, as I was not a Member of the Cabinet but merely an Under-Secretary whose business it was to carry out Cabinet policy, I can tell the Committee that the Cabinet agreed in February, 1929, to the setting up of this tribunal the report of which is under consideration to-day. If the right hon. Gentleman is to convince the Committee of the strength of his case, he has to give reasons why, having agreed to the tribunal being set up, he disagrees with the acceptance of the award given by it.
  Mr. CHURCHILL: It has not made any award. I made it clear that the £1,500,000 is the direct proposal of the Government.
  Earl WINTERTON: The right hon. Gentleman is quite right. May I put it this way. He will have to give reasons why he disagrees with the Report. He does not deny that they made a report. It is true that the actual implementing of the decision to set up the arbitral board was not reached until after the 1924 Government had ceased to hold office, but it is, nevertheless, the case that the principle was accepted by the previous Government, and the right hon. Gentleman rather slurred over that portion of his speech. He would not deny that he agreed to the general question of the charges that fall either upon the Indian
  1700
  or the British taxpayer as the case may be being submitted to arbitration. There can be no question about it because the facts are on record. That question, at any rate, seems to be disposed of as far as the right hon. Gentleman is concerned. He went on to talk about the composition of the tribunal. I was not clear what his views were. He might, of course, argue that they were not suited to arbitrate on this matter, though he would know that men of the type who formed this tribunal have always been asked to arbitrate on questions of even greater importance than this. They were Sir Robert Randolph Garran, a very distinguished legal authority, Lord Dunedin and Lord Tomlin, two men whose names are household words in this country and who have high judicial capacity, and two very distinguished Indians both of whom have held high judicial office in India, Sir Shadi Lal and Sir Shah Muhammad Sulaiman. So I do not think that any member of the Committee ought to object to the composition of the tribunal. What made a definite impression on my mind was that the right hon. Gentleman proceeded to criticise the recommendations that the Committee had reached from the standpoint of a very acute student of military affairs. There I do not profess to be in a position to enter the lists with him. He may be quite correct, but, as he asked us to look at the pages of the Report, let me also refer him to a passage:
  "A majority of us accept the view placed before us by counsel for the War Office of the general division of responsibility between India and the Empire on the basis of protection against the minor and the major danger. But none of us thinks that this disposes of a question of contribution."
  That is very definite. They go on as the right hon. Gentleman said to give their two grounds. Number one is
  "that the Army in India is a force ready in an emergency to take the field at once, which does not exist elsewhere in the Empire, which is specially available for immediate use in the East and which has on occasions been so used."
  In the contention that he put forward he seemed to suggest that it was not true to say that this was a force ready in an emergency to take the field at once which does not exist elsewhere in the Empire. I am afraid I must say I think he is wrong, because he and I would be in entire agreement with most of my hon. Friends that we deplore

  1701
  that there is not in this country a force immediately ready in an emergency. The right hon. Gentleman quoted the case of 1914. I must not go into that matter at length, or you, Sir Dennis, would check me. Whereas we had in 1914 a most efficient small military instrument for an expeditionary force which had a preponderating influence on the War, can any one say that we have such a force to-day? It is notorious that we have not. You cannot compare the pre-War expeditionary force and the British Army as it exists in this country to-day. There is no comparison between the two. The relative value of the Indian Army is much greater to-day than it was in 1914.
  Mr. CHURCHILL: Surely, my Noble Friend might use his argument in the sense that this £1,500,000 might be used to improve our Forces in this country?
  Earl WINTERTON: Certainly that is a perfectly fair interruption, but I should be called to order if I pursued it. I should be prepared to support the right hon. Gentleman or any right hon. Gentleman in demanding a larger sum for the British Army, but that is another question altogether. At any rate, he must admit that you cannot draw a comparison between 1914 and to-day. I admit that the Indian expeditionary force in 1914, as anyone of us who saw it at the front would agree, was not wholly suited to the purpose for which it was used and which was not the purpose for which it was intended. I should be surprised to find that the lessons of the War had been entirely lost and that if it were necessary to send an expeditionary force from India, composed partly of British and partly of Indian troops, that force would not be far more effective to-day than the force which was sent before. I cannot admit the contention put forward by the right hon. Gentleman that it is correct to say that the finding of this very distinguished tribunal was a wrong one. I think it was a perfectly accurate one.
  I do not want to enter into controversy with the right hon. Gentleman, but I was rather sorry that he spoke in the way he did upon the effect of India on the health of the troops and the spread of venereal disease. It really does not seem to have very much bearing on the case. The health of the Army in India is astonishingly good; the improvement is beyond all belief. It is not very helpful to suggest that going to India has this effect
  1702
  upon men. I should have thought that the right hon. Gentleman would have been the last to say anything of this kind, in view of the delightful book of reminiscences which he wrote about his own personal Indian experiences. I should say that most young men, whether in the ranks or holding commissions in the Army in India look upon their stay in India as one of the most enjoyable experiences in life, and not from the point of view of which the right hon. Gentleman seemed to think.
  When people talk about the conditions of India, they must have regard to the Indian side of the question, and the Committee should remember that, after all, taking one thing with another, the contribution which India has always made in men and in money for the general defence of the Empire, is infinitely greater than that of any part of the Empire, except Great Britain. Taking their contribution towards the Navy, the troops which they have sent overseas, and the assistance given by the Indian people, taking the thing as a whole, you will find that what I have just enunciated is absolutely true. Moreover, in many respects they have been treated more harshly than otherwise. They have been made to pay for defence while some of the wealthier Crown Colonies, and, indeed Crown Colonies in general, have never been asked to do so. In the old days it is an historical fact that when British troops were kept in Canada and in other Dominions the Dominions were not asked for any contribution. Therefore let us approach the matter fairly, and remember that India in this connection is rather a special case.
  The last question which I want to ask is whether or not the decision which the Government reached as to the amount of money to be paid, is a just one? I hope I have disposed of the idea that it is wrong to set up the tribunal, anyhow as far as the right hon. Gentleman the Member for Epping is concerned. Is it right, in view of the report which the tribunal gave, to make the contribution which is being proposed to the Committee this afternoon? The right hon. Gentleman mentioned that the figures had been put forward by the India Office: "A fixed percentage of India's total expenditure on defence, say one-half, about £18,000 per annum. The extra cost of maintaining a correspond-

  1703
  ing number of Indian troops, estimated at £10,000,000," and other figures like that. He seemed to be rather scornful of that having been done. Of course, it was the duty of the India Office to represent the views of the Government of India in this matter. Had he been Secretary of State for India he would have taken exactly the same course as the right hon. Gentleman. It was his duty to do so. He has to represent the point of view of the Government of India.
  Mr. CHURCHILL: Surely, it is not the duty of the Secretary of State, the circumstances being what they are, to put forward a demand for an additional payment of £18,000,000 to India?
  Earl WINTERTON: It is the duty of the Secretary of State before the tribunal to represent the views of the Government of India. The right hon. Gentleman cannot have it both ways. He and his friends outside this House are always talking about abdication and surrender, and when the India Office put forward a thing on behalf of India which is not surrender, he takes exception. He cannot have it both ways.
  Mr. CHURCHILL: I know which way that is.
  Earl WINTERTON: I am afraid that I did not catch the right hon. Gentleman's remark, but I have no doubt that it was a very interesting one. My point, therefore, is not whether or not the Secretary of State for India was right in putting forward those figures. The fact is those figures were put forward, and the Government have adopted a very much lower figure. I hope that those who are going to support the right hon. Gentleman will answer this point. If you accept it as right that a tribunal should be set up and you do not accept their report of the lower figure, what figure would the right hon. Gentleman support?
  Brigadier-General Sir HENRY CROFT: As one of those who are going to support the right hon. Gentleman, may I ask the right hon. Gentleman the Member for Horsham (Earl Winterton) if he accepts, or thinks that it would be right, to accept the decision of the Simon Commission?
  Earl WINTERTON: I might discuss all sorts of questions with the hon. and gallant Gentleman. Does he think it right to carry out a raging, tearing propaganda
  1704
  throughout the country? But those concerns do not arise on this Vote, though I should be pleased to discuss them with the hon. and gallant Member on a more appropriate occasion which will probably arise in the Autumn. I am sure that the hon. and gallant Gentleman knows the rules of the House and would not wish to draw me into conflict with the Chair in regard to the Simon Report, which cannot arise on this Estimate.
  Sir H. CROFT: The Noble Lord was asking if we were bound in this House to accept anything a tribunal put before us. I merely ask him, what about the Simon Commission?
  Earl WINTERTON: I was not putting the hon. and gallant Gentleman in quite the same category as the right hon. Gentleman the Member for Epping because he has no responsibility, direct or indirect, for setting up the tribunal. I was referring at the moment to the right hon. Gentleman the Member for Epping. The right hon. Gentleman suggested that the Government, and the Secretary of State in particular, had brought the question forward at the present time because it had some sort of connection with the constitutional changes in India. I think that it is a very far-fetched suggestion, in view of history, and the fact that this matter has been under consideration almost for a generation, and that the right hon. Gentleman himself has taken great interest in times past in the question, although he has not always accepted the view put forward by the Government, and in view of the fact that the tribunal was set up in 1929 before any question of the Round Table Conference arose.
  Mr. CHURCHILL: What tribunal?
  Earl WINTERTON: This tribunal. In fact, taking all these things into consideration, I must say that it is a farfetched conclusion to say that they brought forward this matter at the particular moment because of some constitutional changes going on. It is for the Government to answer, but for the Committee to form conclusions on the suggetion which the right hon. Gentleman has made. I hope that they will agree with my view. I submit that it has nothing whatever to do with the White Paper or with the question before the Government. I hope they will further agree that this is on the whole a very

  1705
  fair and reasonable settlement of an age-old question, which has caused a good deal of ill-feeling at different times between two Governments, and that it does not place an intolerable burden upon the British taxpayer as the right hon. Gentleman seemed to think.
  5.56 p.m.
  Major-General Sir ALFRED KNOX: I hope that the Committee will listen to a few words from one who served in India for many years, who has also been on the other side of the Afghan frontier and in Russia, and who, therefore, may be thought to know something of this subject. It is true, as the Noble Lord the Member for Horsham (Earl Winter-ton), has said, that this has been an age-long controversy. In the subordinate position which I held in India and in serving the War Office at home, I only heard from time to time that this question was being discussed between the India Office and the War Office. The first actual statement or the subject which I happened to see was when reading and toiling through the evidence of the right hon. Gentleman the Secretary of State before the Joint Select Committee. I think it was after Sir Malcolm Hailey's statement of the financial situation as regards the White Paper had been put before the Joint Select Committee, and the Secretary of State was trying to give some crumb of comfort regarding the rather difficult financial situation in which India would be. I have not looked it up, but I remember that he said, "There is just a hope—I will not put it at more than a hope—that the tribunal which is now sitting may afford the taxpayer in India some measure of relief." Undoubtedly the Secretary of State did not then know how much money was going to be given by the British taxpayers in this country for the relief of the taxpayers in India, or, as I contend, for oiling the wheels by which the White Paper policy will be introduced into India. He could not tell then, but he knew perfectly well when he said that the recommendations of the tribunal, because the date of the report of the tribunal was 4th January, 1933, though it was not printed until December, 12 months later. No doubt at the time the right hon. Gentleman the Secretary of State was discussing this matter he was urging on the Government to make a generous contri-
  1706
  bution towards India's need, or towards the implementing of this new system of democracy in the East.
  I agree with the Noble Lord the Member for Horsham that it is perfectly true there is nothing to be said against the fact that this tribunal was set up, though as a soldier, it seems to me rather extraordinary that you should have five legal gentlemen to decide on a question which, in its essence, is purely military. I am told that very eminent counsel on both sides argued the question in front of this legal tribunal, and no doubt the Secretary of State and the India Office put up their best case. But the question is purely military in its essence. I should like to ask whether India is not indebted to Great Britain for the large number of men maintained continually in India, like a dumb-bell held at arm's length, as the right hon. Gentleman the Member for Epping (Mr. Churchill) said on our organisation at home? I remember that Sir Charles Dilke was in favour of a scheme of short service of 10 years in the Army, two years with the Colours, and eight years with the Reserve at home, which would have given us a large Reserve at very small cost to meet our commitments in Europe and in the West. The whole of that scheme had to be scrapped owing to the necessity of finding the troops for India. India cannot pay for the transport of frequent drafts under any real system of short service.
  Our Army in India has a three-fold task to perform. In the first place, it has to defend the North-West Frontier of India against a major attack, say, by a European Power. Secondly, it has to be prepared to defeat a minor attack by any of the tribes on the North-West Frontier of India, and, thirdly, and most important of all, it has to maintain internal order all through India. Lord Kitchener foresaw the danger of a Russian advance through Afghanistan and he regrouped the Indian army so that it would be immediately available to repel a Russian advance from the North-West Frontier. Since those times, we have had the revolution in Russia and the whole problem as regards Russia has completely changed. There is not the same danger from Russia in the military sense, as in the old days. A single propagandist passing through the Hindu Kush could do

  1707
  far greater harm than a large invading army. Astute people like the present rulers in Russia would never think of sending a million men through the passes of the Hindu Kush.
  Although the danger of a Russian attack on the North-West Frontier has been removed, we have to face increased danger internally in India where the Bolshevik enemy, if it attacks us, will operate by undermining public confidence in India. Therefore, more British troops are required to maintain internal order in India. On the other hand, a tribal rising on the frontier can be met by India's present resources, the British Army allied to the Indian troops at present there. They do not require reinforcement from this country. In the great rising in 1897 in Tirah, there were no reinforcements sent from this country to any large extent.
  Certain processes have been going on in India lately which have increased the need of British troops in that country. It is ridiculous for anyone who knows that enormous country to think that the small handful of British troops there, 58,000, can really control by force, a population of 353,000,000. They never did. We have always held India by prestige. Certain features of the policy of the Government of India and of our own Government during the last few years have tended to lower our prestige, and for that reason British troops are far more necessary in India now than they were five or six years ago. As a soldier I look upon it as absolutely impossible to imagine that any large proportion of our troops in India could be sent to China or Hong Kong or anywhere else in the East where they might be required. If the Committee of Imperial Defence looked into that question they would find that our troops are tied down to India. Communal riots have enormously increased since the promise of democratic reform in India, and in communal riots British troops are essential to put down the rioting, if possible, without bloodshed.
  It is part of the new policy in India to go in for what we call Indianisation. A certain number of units have been in process of Indianisation for several years. That process is depriving those units gradually of British officers and re-
  1708
  placing them by Indian officers. We know now that a whole division has been handed over to this process of Indianisation. The process of Indianisation is decreasing, as it goes on, the fighting value of those units. If you hand over a whole division of the Indian Army to Indianisation, you will reduce the fighting value of the Indian Army for many years by a whole Indian division. There is, therefore, all the more reason why India should draw troops from this country in order to help her to maintain order and to preserve her strength on the Frontier.
  There are many ways in this country in which we could use the £1,500,000 which is proposed in this Vote. Take our own Army. Have we had proper manoeuvres year after year? What about the Territorial Army? Is it not discouraging when one attends territorial dinners to learn how difficult it for the handful of officers to get recruits, and also to learn how the Territorial Army is being starved by the Government? Yet, in a fit of open-handedness, the Government are handing over £1,500,000 in perpetuity to India. I hope that the Committee will take into consideration some of the points raised by the right hon. Member for Epping and that they will think twice before they tie down this country to contribute £1,500,000 annually to India in the way proposed.
  6.6 p.m.
  Sir BASIL PETO: I should not presume to address the Committee if I had not wished to bring forward one particular point and to ask a question, which was touched upon at the end of the right hon. Gentleman's speech. It was not referred to by the Noble Lord. The point that I wish to make is this: Why are we discussing this Vote on a Supplementary Estimate now? The Secretary of State told us that directly he went to the India Office he determined to set up this committee or tribunal to try to find a solution for what had been in controversy for 40 years. If this question has been awaiting settlement for 40 years, and if the whole question of the settlement of the future of India is about to emerge, when we are allowed to see the Government of India Bill which is about to be introduced, why is it not an appropriate part of that Bill to settle the future contribution from this country

  1709
  to the defence of India? That question requires an answer.
  I should like to put a further question. The sum of £1,500,000 is not recommended in the report. It is a sum that has been arrived at, quite fortuitously so far as we can tell, by the Government. We have not been informed what was the basis of their decision. One thing only is perfectly clear, and that is that this sum will not satisfy Indian aspirations and Indian demands. On page 15 of the report, in the demand put forward by the India Office, representing the views of India, as to what they ought to have as a contribution towards defence, the figure varies from £10,000,000 to £18,000,000—a very different figure from £1,500,000. Therefore, are we not really providing a bone of contention by voting something which clearly will not satisfy India, and putting it forward within a few months of the time when this House will be asked to go into the whole question of India's future? Why is this particular item put forward to-day?
  If I had no other grounds for believing that I can support the right hon. Member for Epping (Mr. Churchill) in the stand that he has taken it would be the ground that, clearly, whether £1,500,000 or some other sum is the appropriate amount that ought to be contributed, over and above what this country already contributes and has contributed for many years to the defence of India, it is not to-day that that proposal ought to be put before the House; it ought to be part of the settlement of the whole of this question which we understand is to be put before Parliament as a result of the three Round Table Conferences and of the recommendations of the committee which has been sitting for so many months on the subject.
  6.10 p.m.
  Mr. MORGAN JONES: I do not propose to enter into the controversy between the right hon. Member for Epping (Mr. Churchill) and the Government. I content myself by saying that I am sorry that on an occasion like this, opportunity should have been taken to examine, as it were, in a very broad way, the general policy of the Government in relation to India. I want to take strong exception to what is being conveyed through the medium of this Vote. As a result of the finding of the committee or tribunal the question has been examined
  1710
  between the War Office and the India Office as to what would be an appropriate amount to allow in relation to Imperial defence. The decision arrived at has been that £1,500,000 is an appropriate sum. It is very difficult to know upon what basis that sum has been arrived at, and I should have been very glad if the Secretary of State had taken us more into his confidence on that point. We do know something of the general principles on which the decision was arrived at, but exactly why, we are not informed.
  Why has this sum of £1,500,000 been fixed? Because the committee or tribunal came to the conclusion that there is a certain amount of money which can properly be called money spent on Imperial defence. This sum of £1,500,000, therefore, is expended upon Imperial defence. It has nothing to do with India. It has something to do with Army expenses but nothing to do with the expenses of the India Office. I take the strongest exception to putting a Vote of £1,500,000 on to the Vote of the India Office, when in point of fact it properly belongs, according to the decision of the tribunal itself, to Imperial defence.
  The right hon. Member for Epping twitted my hon. and gallant Friend the Member for South-East Leeds (Major Milner) with a desire to get the £1,500,000 put on the Army Vote so that we might go to the country and say that the Army expenses were £1,500,000 more. That may be good from the right hon. Gentleman's point of view, but my hon. and gallant Friend was quite honest about it. He admitted that if this sum of £1,500,000 was put on the Army Vote it would not represent any more armaments. It would, however, give an exact picture of the amount of money expended upon Imperial defence in respect of the Army. That is our point. It ought not to be put upon a Civil Vote. It ought to be put upon a Defence Vote. We object very strongly to this sum of £1,500,000 being taken, as it were, out of sight and removed from the Defence Vote Services, and put, quite wrongly, upon the India Office Vote. Some of us have been appointed to sit on the Public Accounts Committee and when the time comes we shall examine this particular point with meticulous care and may have something to say about the propriety or otherwise of the procedure adopted by the Government in this matter.
  6.16 p.m.
  Viscount WOLMER: I associate myself with my right hon. Friend the Member for Epping (Mr. Churchill) in the protest he has made against this Supplementary Estimate. I do not believe that any any other Government we have ever had would have made itself responsible for this proposal in this form. I listened with great interest to the speech of the right hon. Member for Horsham (Earl Winter-ton) in defence of the Vote, but there was one question to which he never addressed himself throughout the whole of his remarks, and that was whether we are in a position to afford this extra expenditure, an expenditure not merely for one year but for ever. This amount of money represents the interest which the British Government would have to pay for a loan of between £40,000,000 and £50,000,000. It is a big item of expenditure, and when the right hon. Member for Horsham was reciting the ancient history of this matter, he entirely omitted to deal with the great financial stringency which we have been facing in all departments of our national life since 1931. At a time when we have had to cut down the vital defence services of the country below the danger point, at a time when many hon. Members feel that the allowances to the unemployed and to other social services are inadequate, what justification have the Government for putting this huge burden on the British taxpayer before these other national vital interests have been met, and in a form to which no other previous Chancellor of the Exchequer has agreed?
  I am astonished at the attitude of the Labour party on this matter. They do not appear to realise that this £1,500,000 is to be for ever withdrawn from the use of the British taxpayer, from our own defence services, and our social services, and from the hundred and one purposes for which the money is so urgently required to-day. I suggest that the first question to which the Government ought to address themselves is whether we are in a position to afford this very large sum. I would remind hon. Members that there is absolutely nothing new at all in the contentions which have been put forward in the Committee to-day. These arguments have been advanced for the last 40 years, and have been rejected by every Chancellor of the Exchequer during the last 40 years. Every Chancellor of the Exchequer has weighed these considera-
  1712
  tions, and they have been turned down and rejected by every previous guardian of the nation's finances; and for us to admit that they are valid now, at a time when this country is suffering so much from a shortage of money, is, to my mind, to go back entirely on the decision of all previous Governments and all previous Chancellors of the Exchquer who have considered the matter.
  You admit that for 40 years at least we have been exacting £1,500,000 too much from the people of India. It will inevitably bring a claim on this country for arrears. When a previous Government attempted to come to a financial adjustment with Mr. de Valera he sent in an account dated from a period which occurred shortly after the Norman Conquest. We are going to have the same thing on a small scale in regard to India; and I hope that no hon. Member imagines that we are going to get any sort of settlement by this Vote. The right hon. Member for Horsham spoke of a settlement. What sort of a settlement is this? The report of the committee is really only a chairman's report; every member of the tribunal has a dissenting minute. The Indian members of the tribunal have repudiated responsibility for the sort of settlement which the Government are now proposing, and the India Office, voicing Indian public opinion, have also repudiated completely the sort of settlement which is proposed in this Vote. Therefore, there is no settlement. You merely admit that for 40 years you have been taking £1,500,000 too much out of the people of India. That is not going to do our prestige in India any good. That is not going to improve the feelings between India and this country. It must inevitably lay the foundation for further claims against the taxpayers of Great Britain.
  These considerations, of course, would not count very heavily if I thought that the claim was just, but I oppose the Vote because I think the claim is unjust. If you consider what England has done for India and what India has done for England, then India is enormously and incalculably in our debt, and not the least of the great services we have rendered India is to maintain, at a great strain on this country, an army there which is absolutely essential for the preservation of law and order. I think that in demanding that the people of India should pay the cost of that army, we are only doing

  1713
  what is fair and just both to the people of India as well as to the people of England. For these reasons I deplore the decision of the Government to mortgage the financial resources of this country to a capital amount of between £40,000,000 and £50,000,000, in perpetuity, at a time when we cannot possibly afford such an expenditure and in a manner which is not going to bring us a word of thanks from the political agitators in India. You are going to have this flung back at you, just as you will have the White Paper flung back at you. You are not going to win any friends by this concession; you are merely going to impose a burden on the taxpayers of this country which is going to stand in the way of social services and national defence, and in the way of every cause which at the present moment is being starved for lack of money. If my right hon. Friend the Member for Epping goes to a Division I shall, for these reasons, support him in the Lobby.
  6.24 p.m.
  Sir JOHN WARDLAW-MILNE: I was delighted to hear the right hon. Member for Aldershot (Viscount Wolmer) say so clearly that the considerations which he has been putting before the Committee for the last few minutes will not weigh with him at all against the one cardinal question as to what is the justice of the case. It was vitally important that he should have made that statement, because it is easy to raise prejudices and ask whether we can afford this or that; it is easy to say that capitalised this charge represents an enormous outlay for the country. That argument can be used in the case of every expenditure which this House is asked to consider. There is not a single Vote which we pass that cannot be capitalised and magnified into an enormous charge—it may be correct in some cases—upon the people of this country for all time. It is true that this is a burden on the taxpayer; every Vote we pass is a burden on the taxpayer. The argument has really very little to do with the question. It is not a question of whether we have to pay out of the pockets of the taxpayer or at the expense of other services; that argument carries us nowhere. The real point is, what is the justice of the case? Are we right in making a contribution to the cost of the British Army in India, or are we wrong? Are we entitled to refuse to make such a contribution? If we are not entitled to
  1714
  refuse, if it is a just claim, then there is no point in raising questions of prejudice about the burden on the taxpayer, and all the rest of it. I say that there is no other matter for consideration except the bare question of the justice of the case.
  I am not very much interested in the suggestion that if we give this money now we shall immediately be asked for payment for all the years—40 or 50 or 100 years—that we have not paid. I doubt very much whether whatever happened in the case of the Irish Free State has any bearing on this question. There may be something to be said for the contention that we should have paid before; it is possible that an argument on those lines can be raised, but to say that we will not consider the question because we ought to have paid before, and that we do not want the person to whom we owe money to know that we owe the money, is very much like saying that as the person to whom we owe money has forgotten, we will take good care not to remind him. That is an argument which, to my mind, should not appeal to an Assembly of this kind. Dealing only with the question as to whether we are right in refusing to make any contribution, I know nothing beyond the report of the tribunal itself. I know that this has been a matter of controversy for many years, but of the rights and wrongs of the controversy I know nothing except what I see in the report. Here we have a report by very eminent legal authorities which gives a very definite answer to the question. I invite the attention of hon. Members to a paragraph in the report which says:
  "We think that the answer to the question, whether a contribution should be made from Imperial revenues towards military expenditure from Indian revenue is: Yes, but in respect of certain limited matters only."
  There we have a very definite answer, and I would suggest also that it is not right to say that this is a military question. Surely, the question of paying a contribution is not a military but a legal matter. This is a very definite answer from a tribunal which every Member of the Committee has joined in agreeing is eminently suitable to give us an authoritative reply. Their reply is that a contribution should be made. There is then only the question as to what that contribution should be. A great deal of play has been made by the right hon. Mem-

  1715
  ber for Epping (Mr. Churchill) and others with the fact that the tribunal laid down no figures. That is true. But it laid down the basis on which this contribution should be made, leaving the actual figures as a matter for the British Government, or possibly they had in view some arrangement between the two Governments concerned. The grounds on which a contribution should be made are also set out in paragraph 22, namely, that the Army in India is a force ready to take the field at once, and, secondly, that India is a training ground for active service.
  Although we know nothing, and the Secretary of State did not give us any basis on which he had built up this figure of £1,500,000, still I can look at it in this way: The total expenditure of India as set out here is something like £36,000,000. The contribution which we are asked to agree to is, therefore, roughly about 4 per cent. of the total expenditure, or 8 per cent. of the expenditure on the British Army alone. The whole question therefore is, do we agree with the recommendation that a contribution of some sort should be made, are we willing to accept the tribunal's decision on that point, or are we not? if we are willing there is only one other question, what is to be the amount of the contribution? Is 4 per cent. of the total military expenditure or 8 per cent. of the British military expenditure too much or is it too little?
  It is extremely difficult for anyone who has not followed this controversy, which has gone on for years, to give an opinion on that point. I do not feel qualified to do so. But I feel bound, very unwillingly—just as unwillingly as any Member of this Committee could possibly feel when it means an expenditure of public money—to accept the advice of this tribunal that a contribution should be made and that it is our duty to make it, and if I accept that advice I am faced with the question of the amount. I wish that the Secretary of State could have given us a little more information as to how the figure of £1,500,000 was reached. In the absence of that information it does not at first sight seem to me that 4 per cent. of the total expenditure of India is a very large amount for us to pay. It is impossible to go further than to say that as the matter stands, accepting this
  1716
  recommendation, I am prepared to accept the 4 per cent. but I would have liked to have known how the figure was reached, whether the Government of India had agreed to it and was satisfied with it, and generally on what the figure was based.
  6.35 p.m.
  Mr. J. JONES: There is a saying that, "Fools step in where angels fear to tread." I hope that I am neither a fool nor an angel. All of those who have been taking an active part in agitating for a continuation of British rule in India will be very proud to read some of the speeches delivered here to-day. It will be balm of Gilead to them to know that some people in this country are afraid to make a contribution towards the maintenance of the British Army in India. So far as I am concerned—I am speaking for no one but myself—I say that we are not maintaining an Army in India for the good of India, but are maintaining it in order to preserve the integrity of the British Empire. Let us be frank about it. Empire means domination, and if we mean to maintain supremacy in the affairs of the world we must have a strong Army, a powerful Navy and all the other concomitants. The majority of our soldiers in India are there to preserve the integrity of the British Empire. I was sorry to hear one of our ex-Ministers, one who has loomed very large in the public eye, practically suggest that our recruits, the young men who defend the Empire, cannot be trusted in India very far. He says that they are led astray and lose all their Christian virtues when they mix with Hindus and Moslems.
  A good deal has been said about the £1,500,000 that this proposal will cost. Shall we be told by the other side what we get out of India, what tribute the people of India are paying for the privilege of living under British rule, what control the people of India have over their own lives and welfare, or what political liberty they have? All this money that we are paying out is not money to protect India against some foreign Power that may be involved against us on some future occasion. What we are doing is paying an insurance policy to maintain our supremacy in India. I am not interested in the amount of money. I am interested in the principle. In so far as

  1717
  the Government are promising to do something to give the Indian people more control over their own affairs, to give them a bigger slice of self-government, I am willing as one man to give them as much liberty as possible, consistent, of course, as others would say, with the supremacy of us, who are so clever as against the Indians. They are a younger people than we are in the sense of democratic control. They have been in existence thousands of years only, compared with our hundreds. They, of course, are a young people compared with us in the matter of democratic rule.
  But democracy is now out-of-date Some of those on the opposite side of the Committee have been denouncing democracy in this country. So long as they have a majority they are democrats, but as soon as they begin to lose power they become autocrats and want to maintain the supremacy of the so-called governing classes. That is what they are doing in India. The Noble Lord the Member for Aldershot (Viscount Wolmer) tried to bring tears to our eyes when he talked about the cuts. He was one of the thickest supporters of the cuts in this House when they were brought forward. He goes to the other end of the earth to cut a workman's wages but never to cut a landlord's rents. All the time and every time he stands up for the privilege of his class. I only wish the working classes were half as conscious of their interest as right hon. and hon. Gentlemen opposite have been in these events. So far as we are concerned we can say what we like and do what we like, because we cannot do much. So far as India is concerned we say that this is only conscience money, which the Government of this country are offering to India in an effort to get a kind of compromise settlement in the dispute between India and England. It will not satisfy the people of India. The better organised they become and the more they understand the situation, the more dissatisfied they will be with the present condition of things.
  Consequently, in spite of all the experts who have spoken, I, as an ordinary onlooker, am pleased to see this family quarrel this afternoon, and, being an Irishman, I wanted to butt in. Noble Lords, right hon. and hon. Gentlemen talk about India. All the time the only
  1718
  thing they never mentioned was the condition of the people of India. All they thought about was the economic position of England, our financial position and our position from a military point of view. The condition of the people of India did not matter. I say frankly that the thing that really matters in India as well as in England is the condition of the people, and until hon. Members get down to that they will solve none of our problems. This is merely an attempt to throw oil on the troubled waters. Of this £1,500,000 not one brass farthing, not a jingle on a tombstone, will go to the workers of India. We are told it is £40,000,000 capitalised. The working people of India will not get a penny-piece of it. It will all go to the satraps, the Ahabs and the nabobs. Expressing an individual opinion I say that the Government can get on with the job. It is their funeral, and not ours.
  6.40 p.m.
  Mr. MOLSON: The hon. Gentleman who has just spoken made it a reproach against those who have spoken earlier that they did not deal with the economic condition of the masses of the people of India. The reason previous speakers have abstained from dealing with that particular matter is not that they have not the interest of the Indian masses very much at heart, but that the question does not arise on this particular Vote. The speech of the Noble Lord the Member for Aldershot (Viscount Wolmer) dealt first of all with the question whether this country is able to afford the payment proposed in this Vote, and, secondly—I agree with the hon. Member for Kidderminster (Sir J. Wardlaw-Milne) that this was the really vital part of his speech—that it was not fair that this country should be called upon to make this contribution towards the cost of the Indian Army. The Noble Lord's opinion is entitled to the greatest respect, but upon this point the tribunal of five very distinguished lawyers was quite unanimous in declaring that there was a moral and justifiable claim on the part of India for a contribution to be made by this country. That being so, at whatever inconvenience to ourselves it is our duty to pay our debts.
  The general gist of the speeches from the Opposition to-day, especially the speech of the right hon. Member for Epping (Mr. Churchill), was a suggestion

  1719
  that the whole question of a contribution towards the cost of Indian defence has only been raised by the National Government for the express purpose of enabling India to afford the luxury of a Constitution on the lines of the White Paper. I was surprised that that line should be taken by those speakers, who are frequently referring this House to the Simon Report and appear to regard the Simon Report as almost verbally inspired. If I may weary the Committee for two or three minutes I would like to prove that the Simon Commission itself was clearly of opinion, without expressing any final conclusion on the matter, that some contribution from this country was morally due to India. In their reference to the creation of an Army in India, which was to be under the control of the British Government, all that India was to do was to pay a fixed contribution towards it. At page 173 of the second volume of the report the Simon Commission say:
  "The North-West frontier is not only the frontier of India: it is an international frontier of the first importance from the military point of view of the whole Empire. On India's frontier alone is the Empire open to any serious threat of attack by land, and it must be remembered that such attack might be delivered not on account of any quarrel with India, but because a dispute between the Empire and a foreign Power had arisen in quite a different part of the world."
  They point out that the defence of the Indian frontier is not merely a local problem of India but one which affects the question of the defence of the Empire as a whole. They refer to the fact that the whole question of capitation payments was under consideration at that time, that is 1928–1929, and one would suppose that the right hon. Gentleman the Member for Epping would have been aware that the matter had then been raised. They say:
  "However it may be decided, both as regards the principle of liability and the actual amount it is only one of the considerations which, as it seems to us, enter into the more general issue."
  They proceed to give some arguments which could properly be put forward on the other side, as showing to what extent India has benefited from the support given by this country, just as they had shown how this country benefits by the existence of an army in India. In their final recommendations, in proposing that
  1720
  the defence of India should be undertaken by the Imperial Government and that India should pay a contribution towards it they say:
  "And of course it would involve an equitable adjustment of the burden of finance, which we do not attempt to prejudge, but which would perhaps most naturally take the form of an agreement to provide from Indian revenues an annual total sum, subject to revision at intervals, and with the opportunity of sharing in economies."
  The words "the opportunity of sharing in economies" prove conclusively that the contemplation of the Simon Report was that at any rate some part of the cost of the defence of India should be borne by the Imperial Revenues. The right hon. Gentleman the Member for Epping frequently quoted the Simon Report against the Government and when I heard him speak upon this subject and make no reference to that vital recommendation in the Report I was reminded of the way in which the right hon. Gentleman always treats the Report. He treats it very much as little Jack Horner, who sat in the corner treated the pie. He selects plums and pulls them out whenever they happen to suit his argument and I think it was not irrelevant in this afternoon's Debate to draw attention to the fact that so far as this question is concerned the recommendations of the tribunal are in accordance with the proposals of the Simon Commission.
  The right hon. Gentleman said that this was not a tribunal but a committee. Well it was set up by the Government who called it a tribunal and I am not going to quarrel about words. It was, if the right hon. Gentleman likes to call it so, a committee, but it was a committee of very distinguished men who approached the matter from a judicial point of view. The hon. and gallant Member for Bournemouth (Sir H. Croft) said that the Simon Commission's recommendations were not accepted and asked why should the recommendations of this tribunal be accepted? I suggest respectfully that there can be no parallel between the two. The Simon Commission was asked to deal with political issues and to put forward proposals for this House to consider. In the case of the tribunal the matter was investigated, if not strictly from a legal point of view, at any rate with an attempt to arrive at what was fair and equitable as between

  1721
  the two countries, having taken duly into account the claims put forward by the two countries through their representatives—the learned counsel who appeared before the tribunal.
  The right hon. Gentleman the Member for Epping has, I understand, actually moved a reduction on this Vote of £130,000 which is the sum in respect of sea transport. He referred to the opinion of Lord Dunedin and Lord Tomlin as a "ruling." That is the word which he used, perhaps unwittingly, because I noticed particularly what he said. But even if he only meant to say that it was an expression of opinion and not a ruling, at any rate it is remarkable that he should attach so much importance to the recommendations of those two learned law Lords when they were in a minority, yet when they agreed with the other three members of the tribunal in saying that there was a moral claim for a payment from this country to India, the right hon. Gentleman suggests that we should not accept their opinion. The reproach has also been made that the sum of £1,500,000 was not actually laid down by the tribunal, and the hon. Member for South-East Leeds (Major Milner) made the criticism that no explanation had been given of how that figure was reached. I submit that it is possible for a tribunal, without arriving at an exact mathematical figure to lay down considerations to be taken into account, and a technical matter of this kind must obviously be a subject for negotiation between the India Office and the War Office.
  One point which I do not think has been brought out in this debate is the distinction drawn between the two elements in the case put before the tribunal. There were certain matters like capitation allowance and sea transport, in which it was possible for the tribunal to arrive at an exact conclusion upon a certain sum of money, and to tell exactly what was, in justice, the amount payable. It is upon one of those issues, that of the sea transport, that the proposal has been made to reduce this Vote. The other part of the case which was referred to the tribunal was the broad matter of equity, the general contribution to India taking into account the respects in which this country benefits by the existence of an army in India, and what the extent of the payment ought to
  1722
  be. Having regard to the unanimous decision of the tribunal that some payment is due to India in that matter, I hope and believe that the Government will have taken a generous view of our liability. I was surprised that the right hon. Gentleman in protesting against the generous interpretation which the Government put upon the debt of honour which this country owes to India in this matter, should have quoted the case of the children's allowances. I am glad to know that he reads the newspapers because if my memory serves me rightly, he has not attended any of the Debates in this House upon the Unemployment Bill. He rather reminds me of a long departed and more eminent statesman who only once referred to the conditions of the working classes in this country and that was when he sought to justify the continuance of slavery in other countries.
  I feel it remarkable that those who so frequently claim that there should be no transfer of responsibility to the shoulders of the Indian people, and who on these occasions indulge in perorations about the trusteeship which we owe to India, should now be unwilling to allow an independent impartial tribunal to decide what payment we should make to those for whom we are trustees in respect of the cost of the British Army which is maintained in India.
  6.55 p.m.
  Sir H. CROFT: I do not propose to delay the Committee long, because I feel that the right hon. Gentleman the Secretary of State who has come down to the House specially to-day in connection with this matter, has already been subjected to a considerable strain, and we all appreciate the fact that he has come here to give us his advice on this question. Without following the hon. Member for Doncaster (Mr. Molson) into a long dissertation on the difference between the report of the Simon Commission and the report of the tribunal, I would remind him that, in the references which he has quoted, the Simon Commission had regard to the fact that we were staying in India as the ruling race responsible for government at the centre and no comparison can be made between the position to-day and the conditions under which the Simon Commission was reported. The whole issue can be summed up in this way. This Government was returned by an overwhelming majority

  1723
  with an unmistakable mandate, demanding the most rigorous economy and claiming from all citizens extraordinary sacrifices—not sacrifices confined to one class, but sacrifices which went through the whole community. Now the Government ask us to accept a decision that the taxpayers of this country, just at a time when we are considering giving up the responsibility of government in India for all time, should pay £1,500,000 towards the expenses of the defence of India, although it was always pleaded, when we had full control and when we were not giving any form of government to that country, that those expenses were borne by the Indian people themselves. That is the issue and I submit that it is unfortunate that this very remarkable decision should be come to, just at a time when the whole Indian question is in the melting pot. It would have been better to have waited until the Select Committee had reported, and the ultimate legislation on which the Government decides was before this House, before proposing to hang this millstone round the necks of the people of this country.
  6.57 p.m.
  Mr. PALING: The right hon. Gentleman has already been asked how this figure was reached. I should like to ask him further, is there any possibility, if this £1,500,000 is granted, of any retrospective claim being made in respect of it? Inquiry into this question has been going on for nearly 40 years, and this is the first time that any decision has been arrived at. Have the Government any reason to suppose that this payment will be satisfactory to the Indian people? If there is no claim for retrospective payments, are they satisfied that there will be no future claim for payments over and above this sum? I am in some difficulty as to how I shall vote on this question. I do not like to add £1,500,000 to our expenditure, particularly for such a purpose. It may be that, because the army in India does serve purposes other than purely Indian purposes, some payment towards the expense is due from us. There is another consideration which has not been mentioned. The army in India performs another service. The army has been maintained in India mainly for the protection of the interests of the bondholders. It may be that we are entitled to pay something from that
  1724
  point of view, but, as I say, I do not like adding this sum to our expenditure for military purposes at this juncture. That is my case against the Government.
  Frankly, however, I cannot fall in very closely with the critics of the Government. I have been surprised this afternoon. One would imagine, from what was said by some of the speakers, that they were the champions of expenditure on social services in this country. Their main argument against this expenditure is that if we spend £1,500,000 on the Indian Army in this way, it will not be possible to give back the cuts to the persons who have undergone them and to the social services. The specific case of the 3s. for the children was mentioned. I am interested in that remark, coming from hon. Members opposite—the late Chancellor of the Exchequer and the Noble Lord the Member for Aldershot (Viscount Wolmer). I wonder what they would have done in that direction, and what they are going to do in the future? I shall watch their votes with great interest and shall hope, when this question comes up in the future, that we shall have the right hon. Gentleman the Member for Epping (Mr. Churchill) and the hon. Member for Aldershot in the Lobby with us, and also raising their voices in the House on behalf of the oppressed working people and in favour of increased expenditure on social services. After hearing both cases. I am almost in the position of saying, "A plague on both your houses."
  7.2 p.m.
  Mr. ATTLEE: I rise to make two points on what fell from the hon. and gallant Member for Bournemouth (Sir H. Croft). Some of his remarks were not quite in accordance with the facts, particularly his argument in regard to the Statutory Commission. When the Statutory Commission were making their inquiries, it was brought to their notice that there was a long-standing controversy. They considered the evidence. They did not go into details, because the matter was under arbitration, but they found that it actually was a matter in which they could consider the rights between the parties financially, and they had nothing to do with any conclusion at which they might ultimately arrive on the constitutional question. The only other thing I wish to say is that I have always regarded the hon. Member for Bournemouth as the high priest

  1725
  of Imperial sentiment. Nevertheless, I understood him to say that whenever this self-government is given to a part of the British Commonwealth of Nations, we should then divest ourselves of the obligations of defence. I am surprised at the hon. and gallant Member advising that course.
  7.4 p.m.
  Lieut.-Colonel Sir WALTER SMILES: I wish to speak only for a minute or two on one aspect of this case. I have heard this matter debated by a great many Indians during the last 14 or 15 years, and for all I know it may have been debated before that. The average Indian politician feels very keenly on this matter. What we are doing to-day is to assess the value of the British soldier and the British Army in India. It is very difficult to assess that value. A policeman may at one time be merely a good-looking man in blue, and at another time he may be the means of saving your life. It is very difficult to assess the value in millions of pounds of the British Army during the last Afghan War. I am, however, anxious to get the matter settled and out of the way, and I consider the present an opportune moment to do so.
  I am one of those people who have very grave fears of what may happen in India when responsibility is relinquished at the centre. I have voted against the Government on various occasions, but on this occasion I propose to vote with the Government. I consider that this is a reasonable proposal to carry out, and that in many ways £1,500,000 will be cheap. It will certainly be cheap if the Indians are satisfied. As regards the arrears of payment, I cannot visualise any future Government considering them. The British Army in the past has been of more value to India than the British Army will be in the future—at any rate, I hope it has, if the Indians are to be capable of governing themselves. I have heard it said to-day that the Army in India is readier for war than the Army at home. I hope that we do not have a repetition on any future occasion of the medical arrangements of the Indian Army in Mesopotamia. It was not the Indians who were responsible for those arrangements; it was the British medical service which let the Indian Army down on that occasion. With that in my mind, and also the value of the Indian Army to us in the War when they fought for us
  1726
  in Tanganyika, on the Suez Canal and in Mesopotamia. I look upon this sum as a debt of gratitude to the Indian Army, and have much pleasure in supporting the Government to-day.
  7.6 p.m.
  Sir S. HOARE: I am very much obliged to my two hon. Friends, the right hon. Member for Epping (Mr. Churchill) and the hon. and gallant Member for Bournemouth (Sir H. Croft), for their friendly personal allusions to myself. I appreciate in particular the observation of the right hon. Member for Epping that he disapproved of the sin though he was friendly to the sinner. I was glad to hear him make that observation, because it shows that, however much one may differ politically from one's hon. Friends, one's personal relations remain very much the same.
  I own that at the end of this Debate I am somewhat disappointed. I had hoped, as I said at the beginning, that once in the long history of Indian discussions we were to have the right hon. Member for Epping on our side. On the contrary, he and his friends have shown great ingenuity, energy and eloquence in developing what appears to be a very formidable case against us. Indeed, as I listened to some of the speeches this afternoon, I was reminded—if I may be pardoned for using the illustration—of a very well-known bass song in the Italian opera, "The Barber of Seville." Those hon. Members who are in the habit of going to the opera will remember how the monk in the Barber of Seville develops in a bass song the growth of a small rumour, some insignificant fact, into a great indictment that shakes credit and undermines character. I thought to-day, as I listened to some of these speeches, how very closely akin to the development in that song was the development of the case which I heard made against me to-day.
  A tribunal makes an award; it makes an award at a very sinister moment, just when an iniquitous, weak-kneed Government is considering a constitution for India, and is touching that accursed thing the Indian Federation. As a result of that award, the Secretary of State for India comes down with a proposal to this Committee to devote £1,500,000 of the tax-payers' hard-gained money to the

  1727
  support of Indian finances. At this moment it is also worth noting that Indian finances, like the finances of most of the great countries of the world, are in a difficult situation. It is worth noting that the gift of £1,500,000 will be extremely useful to the revenues of India in this emergency, and that it will be extremely useful to the revenues of India if and when the Federal Government comes into existence. In view of these sinister facts, is this not evidence of another plot of the Government to go behind their public declarations and to hoodwink the Committee into a Vote which while ostensibly for the purpose of carrying out the decision of the Defence Tribunal, is really a cryptic way in which to assist the Indian Federation? What a formidable case that may appear to be upon the surface: these people are going to waste the taxpayers' money.
  "Not once or twice in our rough island story,"
  as my right hon. Friend reminded us, has the line of least resistance been found through the taxpayers' pocket. My right hon. Friend was Chancellor of the Exchequer for a good many years, and can speak with greater authority upon the verity of that quotation than I can hope to speak. This iniquitous Government are subjugating Imperial interests to Indian political clamour. Here is another example—again I quote my right hon. Friend's purple passage—of
  "the crochet work which the Secretary of State for India mistakes for statesmanship."
  I have never attempted to be a great statesman; indeed, I have always agreed with that very wise observation of the late Mr. Bonar Law, "If I am a great statesman, all great statesmen are frauds." I content myself with a much humbler role.
  I have tried, since I have been at the India Office, to face the facts of a series of very difficult situations. I have attempted to face those facts without any foolish feeling that my opinion might be infallible, and I may have made a whole series of mistakes. One of those facts which I have attempted to face is the fact connected with this Tribunal and with its award. My Noble Friend the Member for Horsham (Earl Winterton) was perfectly right when he emphasised
  1728
  the depth of Indian opinion upon this question of financial expenditure. Rightly or wrongly, Indian opinion has for many years past felt deeply upon this issue. Indians have seen that out of the Indian Budget, some £90,000,000, a sum of about £36,000,000 sterling is allotted for defence. They find, unlike the Dominions and the Crown Colonies, that they are spending this large sum; they have thought that they were spending too much on defence, and they have thought also that the military defence of India was excessive.
  As to that second suggestion, I claim that if hon. Members take the trouble they can read a whole series of public statements made by me to show that the expenditure on defence in India is not excessive. India, on the ground of history and of geography, is particularly vulnerable, and no charge can be substantiated that the money spent on Indian defence is excessive or that we keep in India a garrison larger than is necessary for defending the frontiers of India and maintaining India's internal security. But having said that, there is the fact, which nobody can deny, that there are few political questions that have so disturbed Indian opinion as the questions connected with expenditure upon military defence. That is a fact that cannot be ignored, and because of that fact I welcomed the opportunity to refer the big issue of the Imperial contribution to what I believed to be, manifestly, an impartial body. As long as I had to answer for India here, as long as any British Minister had to answer for India here, India would continue to think that our views were biased, and on that account it seemed to me that there was everything to be gained by accepting a proposal that had been agreed to by the two previous Governments, a proposal in which my right hon. Friend the Member for Epping concurred on his own personal responsibility, namely, that these questions should be referred to an impartial tribunal.
  When I heard some of the criticisms that were made of the tribunal's report, I wondered very much whether those criticism's would have equally been made against the tribunal if it had reported the other way. After all, we cannot have it both ways; if we were all agreed that much the best way to settle the con-

  1729
  troversy was to refer it to an impartial body, we cannot agree that the decision arrived at is a decision that ought not to be accepted. Let me reassure the critics of the report this evening that the various contentions, particularly those urged by my right hon. Friend the Member for Epping, that this or that aspect of the problem ought to have been taken into account by the tribunal—the heavy burden, for instance, that it imposes on our man-power and so on—every one of those contentions was argued in great detail before the tribunal, every one of them was argued with the help of the best legal opinion in London, and the Committee, taking all those facts into account—the War Office claim and the Air Ministry claim—came to the view that a contribution of some kind was just.
  Mr. CHURCHILL: Of some kind.
  Sir S. HOARE: Of some kind. I now come to the amount of the contribution. The hon. and gallant Member for South-East Leeds (Major Milner) and subsequently the hon. Member for Wentworth (Mr. Paling) asked me to give some indication as to how we had arrived at the figure of £1,500,000. It is interesting to note that those two hon. Members seemed to take somewhat different views as to what the figure should be. If I understood rightly the hon. and gallant Member for South-East Leeds, he was doubtful as to whether the figure was not too small. The hon. Member for Wentworth, on the other hand, was doubtful as to whether it was not too big. That is the kind of difficulty that faced the tribunal and also faced the Government. When I am asked what was the basis of the figure recommended to the Committee, I will say quite candidly how it was that we arrived at £1,500,000. We took into account the occasions in the past when India had been of material assistance to Great Britain and to the Empire in times of national and Imperial emergency. I have here a list of those occasions, spread over the last 50 or 60 years, culminating in the immense assistance that India gave to us in the Great War—when I suppose it would be fair to say that, without the assistance of India, both in men and money, the result of the War, if it had not been different, at any rate might well have been considerably postponed—and ending in the period of
  1730
  Chinese crisis in 1927, when India sent a mixed brigade to Shanghai. These facts we took into account.
  As to the future, of course, one can only make surmises, but we see no reason to justify the suspicions that have been expressed this evening, namely, that India in the future will not be able to give us the same kind of assistance that India has given us in the past. Secondly, we took into account the value to the British Army of India as a training ground. There again it is very difficult to assess that value in pounds, shillings, and pence, but the Government here came definitely to the view that it did involve a substantial value to the British Army. You may say that these are rather general bases for the actual figures.
  Mr. CHURCHILL: Hear, hear!
  Sir S. HOARE: The right hon. Member for Epping evidently thinks that, but I am equally sure that if he goes into greater detail, he will find that they are in practice the only effective bases upon which you can go.
  Mr. CHURCHILL: I can quite see that, but why do they afford grounds for a figure of £1,500,000? Why not £1,000,000 or £3,000,000? How can these matters be brought to such a mathematical computation?
  Sir S. HOARE: That is the difficulty. They must be brought to a mathematical computation if the contribution is to be given. The Departments here chiefly concerned—including, of course, the Treasury—and the Government of India, after long discussion and after interchanging views on the one side and on the other, have come to the view that, setting the debit side against the credit and the credit side against the debit, £1,500,000 was a fair figure; and I think I am justified in saying that the course of the Debate has rather tended to show that it is a just figure. Some hon. Members who have taken part in the Debate holding the view that it ought to be greater and some that it ought to be less, I am inclined to think that that rather justifies the figure at which the Government have arrived.
  Then my right hon. Friend the Member for Epping attacked the item connected with sea transport. Indeed, he has gone so far as to move a reduction of the Vote which would cover the

  1731
  £130,000 involved in this charge. He asked why it was that we did not accept the view of the two British Law Lords, namely, Lord Dunedin and Lord Tomlin. I can give him the answer in a single sentence. We came to the view that the fair course to take in dealing with an award of this kind, where there was no unanimity, was to take the Majority Report of the Committee, and with that in mind we took the Majority Report of the Committee in the case of the definition of the bases of contribution—that is to say, the two British members and the Australian member against the minority of the two Indian members. I put it to the Committee that it would not be fair to take the Majority Report in one case and not to take it in the other case, when it so happens that the two Indian Judges are a part of the majority.
  Lastly, let me deal with what I believe to be the real gravamen of the criticism of my right hon. and hon. Friends this evening. The suspicion, like King Charles' head, is always before their eyes that, although we may be talking about the award of the military defence tribunal, we are really using devious methods to bring about Indian federation. My right hon. Friend elaborated his criticism, and it was repeated by others of my hon. Friends. I hoped I said enough at the beginning of this Debate to show that there is no foundation whatever for this suspicion. This Government did not create the arbitral body. The arbitral body was accepted by my right hon. Friend's Government in February, 1929, when my right hon. Friend the Member for Epping was Chancellor of the Exchequer; it was accepted again by the Socialist Government; and if it had not been, as I said, for the General Election and the subsequent publication of the Report of the Statutory Commission, this tribunal would have been appointed, and should have been appointed, years ago. There is no foundation whatever for suggesting that either the setting up of this tribunal, its award, or the Government's acceptance of the award has anything whatever to do with federation or with the Government's White Paper proposals.
  I hope I have now said enough to bring the Committee back to the real subject of our discussion. I hope I have said enough to show to the Committee that
  1732
  there is everything to be gained by getting this thorny and controversial question settled once and for all. I would say to the hon. Member for Wentworth, who asked me a question upon this point, that there is no question whatever of making this award retrospective. This award is for the future, and assuming that the considerations upon which it is based remain the same, namely, that India remains available for giving Great Britain and the British Empire help in times of national emergency, and, secondly, that India remains available as a great training ground for the British Army, this award, I hope, will be adopted, and I hope it will bring to an end a controversy instinct with suspicion and bitterness that has too long compromised the relations between India and this country.
  Sir B. PETO: Can my right hon. Friend answer one question which I put to him? Can he state why, if this question has been open for 40 years, it cannot wait for a few months more until we have the whole of the Government's policy with regard to India?
  Sir S. HOARE: For the very simple sreason, I should say, that the tribunal, when once it was appointed, was master of its own procedure, and could obviously make its report when and how it thought fit.
  Mr. MORGAN JONES: Why is the right hon. Gentleman's Department answerable to this House for what is, after all, an item of Imperial defence?
  Sir S. HOARE: This is in accordance, as I think the hon. Member will find if he looks further into the matter, with the habitual procedure in Parliament, namely, that in questions of this kind in which a Dominion, or Colony or Dependency is involved, the Department that is responsible for the administration of the Dominion, Colony or Dependency asks for the Vote.
  Mr. JONES: I am still not quite clear. We are asked to vote £1,500,000 which, according to the tribunal, is incurred in respect of Imperial defence—not the defence of one Colony or Dominion, but for Imperial defence. Why is that expenditure not put upon the Army Vote but on the India Vote?
  Sir S. HOARE: The answer really is, first of all, that the Secretary of State

  1733
  for India, being responsible for Indian administration, is responsible to this House for the expenditure of the money. The second answer is of a different kind, namely, that from the point of view of bringing the whole question to the notice of the House, this is the most effective way to do it. Suppose we had put it into the War Office Vote, I think that no hon. Members could have identified the items of expenditure. They would have been spread over the whole of the War Office Vote, and if we did not disclose the amount it would have been extremely difficult to discover what the amount was.
  Mr. JONES: It could have appeared as a single sub-head.
  Sir S. HOARE: I am informed it could not be covered by a single sub-head. It would cover a whole variety of details which it would be almost impossible to identify. I claim that on account both of precedent and convenience this is the best way to do it.
  Question put, "That a sum, not exceeding £1,371,100, be granted for the said Service."
  The Committee divided: Ayes, 34; Noes, 289.

  Division No. 143.]

  AYES.

  [7.34 p.m.

  Acland-Troyte, Lieut.-Colonel

  Davison, Sir William Henry

  Perkins, Walter R. D.

  Agnew, Lieut.-Com. P. G.

  Emmott, Charles E. G. C.

  Peto, Sir Basil E. (Devon, Barnstaple)

  Applin, Lieut.-Col. Reginald V. K.

  Everard, W. Lindsay

  Rawson, Sir Cooper

  Balfour, George (Hampstead)

  Fuller, Captain A. G.

  Sandeman, Sir A. N. Stewart

  Bevan, Aneurin (Ebbw Vale)

  Gretton, Colonel Rt. Hon. John

  Somerset, Thomas

  Bracken, Brendan

  Hartington, Marquess of

  Taylor, Vice-Admiral E.A. (P'dd'gt'n, S.)

  Broadbent, Colonel John

  Jesson, Major Thomas E.

  Wayland, Sir William A.

  Buchanan, George

  Keyes, Admiral Sir Roger

  Weymouth, Viscount

  Cape, Thomas

  Knox, Sir Alfred

  Wise, Alfred R.

  Churchill, Rt. Hon. Winston Spencer

  McGovern, John

  Wolmer, Rt. Hon. Viscount

  Croft, Brigadier.-General Sir H.

  Marsden, Commander Arthur

  Daggar, George

  Nicholson, Rt. Hn. W. G. (Petersf'ld)

  TELLERS FOR THE AYES.—

  Mr. Donner and Mr. Raikes.

  NOES.

  Acland, Rt. Hon. Sir Francis Dyke

  Collins, Rt. Hon. Sir Godfrey

  Gillett, Sir George Masterman

  Adams, Samuel Vyvyan T. (Leeds, W.)

  Colville, Lieut.-Colonel J.

  Gluckstein, Louis Halle

  Allen, Lt.-Col. J. Sandeman (B'k'nh'd.)

  Conant, R. J. E.

  Glyn, Major Sir Ralph G. C.

  Allen, William (Stoke-on-Trent)

  Cook, Thomas A.

  Goldie, Noel B.

  Anstruther-Grey, W. J.

  Cooper, A. Duff

  Gower, Sir Robert

  Aske, Sir Robert William

  Cove, William G.

  Graham, D. M. (Lanark, Hamilton)

  Attlee, Clement Richard

  Cripps, Sir Stafford

  Graham, Sir F. Fergus (C'mb'rl'd, N.)

  Baillie, Sir Adrian W. M.

  Crooke, J. Smedley

  Grattan-Doyle, Sir Nicholas

  Baldwin, Rt. Hon. Stanley

  Crookshank, Col. C. de Windt (Bootle)

  Greaves-Lord, Sir Walter

  Banfield, John William

  Crookshank, Capt. H. C. (Gainsb'ro)

  Griffith, F. Kingsley (Middlesbro', W.)

  Barclay-Harvey, C. M.

  Croom-Johnson, R. P.

  Griffths, T. (Monmouth, Pontypool)

  Barrie, Sir Charles Couper

  Cruddas, Lieut.-Colonel Bernard

  Grigg, Sir Edward

  Beauchamp, Sir Brograve Campbell

  Culverwell, Cyril Tom

  Grimston, R. V.

  Beaumont, Hon. R.E.B. (Portsm'th, C.)

  Davidson, Rt. Hon. J. C. C.

  Groves, Thomas E.

  Bennett, Capt. Sir Ernest Nathaniel

  Davies, Edward C. (Montgomery)

  Guest, Capt. Rt. Hon. F. E.

  Bernays, Robert

  Davies, Maj. Geo. F. (Somerset, Yeovil)

  Guinness, Thomas L. E. B.

  Birchall, Major Sir John Dearman

  Denman, Hon. R. D.

  Gunston, Captain D. W.

  Borodale, Viscount

  Dobbie, William

  Guy, J. C. Morrison

  Boulton, W. W.

  Drewe, Cedric

  Hacking, Rt. Hon. Douglas H.

  Bowyer, Capt. Sir George E. W.

  Duckworth, George A. V.

  Hamilton, Sir R.W. (Orkney & Zetl'nd)

  Braithwaite, Maj. A. N. (Yorks, E. R.)

  Dugdale, Captain Thomas Lionel

  Hanley, Dennis A.

  Braithwaite, J. G. (Hillsborough)

  Duggan, Hubert John

  Hannon, Patrick Joseph Henry

  Brass, Captain Sir William

  Duncan, James A. L. (Kensington, N.)

  Harbord, Arthur

  Brocklebank, C. E. R.

  Dunglass, Lord

  Hartland, George A.

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

  Eady, George H.

  Harvey, Major S. E. (Devon, Totnes)

  Brown, Ernest (Leith)

  Eastwood, John Francis

  Haslam, Sir John (Bolton)

  Browne, Captain A. C.

  Eden, Robert Anthony

  Headlam, Lieut.-Col. Cuthbert M.

  Burghley, Lord

  Edge, Sir William

  Heilgers, Captain F. F. A.

  Burgin, Dr. Edward Leslie

  Edmondson, Major A. J.

  Henderson, Sir Vivian L. (Chelmsford)

  Burnett, John George

  Edwards, Charles

  Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

  Burton, Colonel Henry Walter

  Elmley, Viscount

  Holdsworth, Herbert

  Butler, Richard Austen

  Emrys-Evans, P. V.

  Hope, Sydney (Chester, Stalybridge)

  Campbell, Sir Edward Taswell (Brmly)

  Entwistle, Cyril Fullard

  Hore-Belisha, Leslie

  Campbell-Johnston. Malcolm

  Essenhigh, Reginald Clare

  Horsbrugh, Florence

  Caporn, Arthur Cecil

  Evans, Capt. Arthur (Cardiff, S.)

  Howitt, Dr. Alfred B.

  Carver, Major William H.

  Evans, David Owen (Cardigan)

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

  Cayzer, Sir Charles (Chester. City)

  Evans, Capt. Ernest (Welsh Univ.)

  Hume, Sir George Hopwood

  Cayzer, Maj. Sir H. R. (Prtsmth., S.)

  Fermoy, Lord

  Hunter, Dr. Joseph (Dumfries)

  Chamberlain, Rt. Hn. Sir J.A. (Birm., W.)

  Fleming, Edward Lasceiles

  Hunter-Weston, Lt.-Gen. Sir Aylmer

  Chapman, Sir Samuel (Edinburgh, S.)

  Foot, Dingle (Dundee)

  Hurd, Sir Percy

  Christie, James Archibald

  Foot, Isaac (Cornwall, Bodmin)

  Hutchison, W. D. (Essex, Romf'd)

  Clarke, Frank

  Ford, Sir Patrick J.

  Inskip, Rt. Hon. Sir Thomas W. H.

  Clarry, Reginald George

  Fox, Sir Gifford

  Jackson, Sir Henry (Wandsworth, C.)

  Clayton, Sir Christopher

  Fremantle, Sir Francis

  James, Wing-Com. A. W. H.

  Cochrane, Commander Hon. A. D.

  Gault, Lieut.-Col. A. Hamilton

  Jenkins, Sir William

  Jennings, Rolands

  Muirhead, Lieut.-Colonel A. J.

  Somervell, Sir Donald

  kerr, Lieut.-Col Charles (Montrose)

  Munro, Patrick

  Somerville, Annesley A. (Windsor)

  Kerr, Hamilton W.

  Nation, Brigadier-General J. J. H.

  Soper, Richard

  Kirkwood, David

  Nicholson, Godfrey (Morpeth)

  Sotheron-Estcourt, Captain T. E.

  Lamb, Sir Joseph Quinton

  Normand, Rt. Hon. Wilfrid

  Southby, Commander Archibald R. J.

  Lambert, Rt. Hon. George

  Nunn, William

  Spears, Brigadier-General Edward L.

  Law, Sir Alfred

  O'Connor, Terence James

  Spencer, Captain Richard A.

  Law, Richard K. (Hull, S. W.)

  Ormsby-Gore, Rt. Hon. William G. A.

  Spender-Clay, Rt. Hon. Herbert H.

  Leckie, J. A.

  Palmer, Francis Noel

  Spens, William Patrick

  Leech, Dr. J. W.

  Parkinson, John Allen

  Stanley, Rt. Hon. Lord (Fylde)

  Leighton, Major B. E. P.

  Patrick, Colin M.

  Stanley, Hon. O. F. G. (Westmorland)

  Lewis, Oswald

  Peake, Captain Osbert

  Stewart, J. H. (Fife, E.)

  Lindsay, Kenneth Martin (Kilm'rnock)

  Pearson, William G.

  Stones, James

  Lindsay, Noel Ker

  Peat, Charles U.

  Storey, Samuel

  Llewellin, Major John J.

  Percy, Lord Eustace

  Stourton, Hon. John J.

  Llewellyn-Jones, Frederick

  Petherick, M.

  Strauss, Edward A.

  Lloyd, Geoffrey

  Pickering, Ernest H.

  Strickland, Captain W. F.

  Locker-Lampson, Rt. Hn. G. (Wd. Gr'n)

  Pybus, Sir Percy John

  Stuart, Hon. J. (Moray and Nairn)

  Loder, Captain J. de Vere

  Radford, E. A.

  Sueter, Rear-Admiral Sir Murray F.

  Loftus, Pierce C.

  Ramsay, Capt. A. H. M. (Midlothian)

  Summersby, Charles H

  Lovat-Fraser, James Alexander

  Ramsay, T. B. W. (Western Isles)

  Sutcliffe, Harold

  Lumley, Captain Lawrence R.

  Rankin, Robert

  Thomas, James P. L. (Hereford)

  MacAndrew, Lt.-Col. C. G. (Partick)

  Rea, Walter Russell

  Thompson, Sir Luke

  MacAndrew, Capt. J. O. (Ayr)

  Reed, Arthur C. (Exeter)

  Thomson, Sir Frederick Charles

  Macdonald, Gordon (Ince)

  Reid, James S. C. (Stirling)

  Thorne, William James

  MacDonald, Rt. Hon. J. R. (Seaham)

  Reid, William Allan (Derby)

  Tinker, John Joseph

  MacDonald, Malcolm (Bassetiaw)

  Rhys, Hon. Charles Arthur U

  Todd, A. L. S. (Kingswinford)

  Macdonald, Sir Murdoch (Inverness)

  Rickards, George William

  Train, John

  McEntee, Valentine L.

  Roberts, Aled (Wrexham)

  Tree, Ronald

  McEwen, Captain J. H. F.

  Roberts, Sir Samuel (Ecclesall)

  Tryon, Rt. Hon. George Clement

  McKie, John Hamilton

  Robinson, John Roland

  Tufnell, Lieut.-Commander R. L.

  McLean, Major Sir Alan

  Repner, Colonel L.

  Turton, Robert Hugh

  Maclean, Nell (Glasgow, Govan)

  Rosbotham, Sir Thomas

  Wallace, Captain D. E. (Hornsey)

  Macmillan, Maurice Harold

  Ross Taylor, Walter (Woodbridge)

  Ward, Irene Mary Bewick (Wallsend)

  Magnay, Thomas

  Runge, Norah Cecil

  Ward, Sarah Adelaide (Cannock)

  Mainwaring, William Henry

  Russell, Hamer Field (Sheffield, B'tside)

  Wardlaw-Mline, Sir John S.

  Mander, Geoffrey le M.

  Rutherford, Sir John Hugo (Liverp'l)

  Warrender, Sir Victor A. G.

  Margesson, Capt. Rt. Hon. H. D. R.

  Salmon, Sir Isldore

  Wedderburn, Henry James Scrymgeour-

  Martin, Thomas B.

  Salt, Edward W.

  Wells, Sydney Richard

  Mason, Col. Glyn K. (Croydon, N.)

  Salter, Dr. Alfred

  White, Henry Graham

  Mayhew, Lieut.-Colonel John

  Samuel, Rt. Hon. Sir H. (Darwen)

  Whyte, Jardine Bell

  Mills, Major J. D. (New Forest)

  Sassoon, Rt. Hon. Sir Philip A. G. D.

  Williams, Edward John (Ogmore)

  Milne, Charles

  Savery, Samuel Servington

  Williams, Dr. John H. (Llanelly)

  Milner, Major James

  Shakespeare, Geoffrey H.

  Willoughby de Eresby, Lord

  Molson, A. Hugh Elsdale

  Shaw, Helen B. (Lanark, Bothwell)

  Wills, Wilfrid D.

  Monsell, Rt. Hon. Sir B. Eyres

  Shepperson, Sir Ernest W.

  Wilson. Lt.-Col. Sir Arnold (Hertf'd)

  Moore, Lt.-Col. Thomas C. R. (Ayr)

  Simmonds, Oliver Edwin

  Windsor-Clive, Lieut.-Colonel George

  Morgan, Robert H.

  Simon, Rt. Hon. Sir John

  Winterton, Rt. Hon. Earl

  Morris, Owen Temple (Cardiff, E.)

  Sinclair, Maj. Rt. Hn. Sir A. (C'thness)

  Wood, Rt. Hon. Sir H. Kingsley

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

  Skelton, Archibald Noel

  Worthington, Dr. John V.

  Morrison, William Shepherd

  Smiles, Lieut.-Col. Sir Walter D.

  Moss, Captain H. J.

  Smith, Bracewell (Dulwich)

  TELLERS FOR THE NOES.—

  Mr. Blindell and Mr. Womersley.

  Question put, and agreed to.

  CLASS VI.

    FISHERY BOARD FOR SCOTLAND.
    Motion made, and Question proposed,
    "That a Supplementary sum, not exceeding £1,085, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for the Salaries and Expenses of the Fishery Board for Scotland, including Expenses of Marine Superintendence, and a Grant-in-Aid of Piers or Quays."
    7.46 p.m.
    The UNDER-SECRETARY of STATE for SCOTLAND (Mr. Skelton): I do not think there is need for much to be said by me in presenting this Supplementary Estimate, which arises as a result of extra expense incurred in the Fishery Board's patrol of the coast of Scotland to put down illegal trawling. Last summer it
    1736
    became apparent that one of the fishery patrol boats reputed to be a speed boat had so lost its speed and sea-worthiness as not to be of any service this winter, and a substitute had to be provided. The opportunity was taken of instituting as an experiment a new form of patrol—the hiring of a certain number of drifter fisher boats concentrated at various strategic points where illegal trawling was most feared and did most damage. That policy has, I think it may be said, been a success. The Supplementary Estimate of £1,010 represents the part of the cost of the hiring for which extra money has to be provided. The total cost was £2,040, but the balance has been obtained out of various savings on the general Vote. It is a clear advantage that the patrol boats engaged on police work against illegal trawling should be, as far as possible, indistinguishable

    1737
    from other boats that are keeping the sea at the same time. This is in peace time a small but successful application of the "Q boat" principle. Without going further into the matter I merely repeat that the experiment has been successful, so successful, indeed, that when, as I hope, we shall be able to renew the general fleet of fishery cruisers we shall adopt a principle of making the new boats also "Q boats." I do not think that I need say more than that at this stage.
    7.48 p.m.
    Sir ROBERT HAMILTON: I wish to congratulate the Scottish Office on having adopted a scheme which I ventured to suggest many years ago—
    Mr. SKELTON: Hear, hear!
    Sir R. HAMILTON: —but which was then received with, I will not say contempt, but with coldness. It was perfectly obvious to all of us who are interested in illegal trawling that in order to catch illegal trawlers we must have a constable who is disguised, so to speak. In any attempt to catch illegal trawlers with a vessel which can be seen and identified miles and miles away the chances of success are very small indeed, and it is clear that the fishery patrol will have a very much better chance not only of catching offenders, but of stopping illegal trawling if high-power trawlers, which are able to keep the sea and have a good turn of speed, are employed. I would like to ask my hon. Friend how many trawlers this Vote covers, and for how long they have been chartered? The second point to which he referred is also one of great importance—that the vessels employed on this service should be based on the area in which they are to be employed. When the old fishery cruisers were employed a great deal of their time was occupied in going down to Leith, or wherever their station was, to coal, and then go north again. When we put questions as to the time thus occupied we were told that they could do a certain amount of patrolling work on the way to and fro, but, as far as my own constituency is concerned, the fact remained that when a vessel went to Leith she was away for many weeks.
    I am very glad that the Scottish Office have now definitely entered on a new method of dealing with the difficulties with which they have to contend. The
    1738
    difficulties are very great. First, there is the difficulty of identifying a trawler who covers her marks and number; second, the difficulty of getting evidence that she was inside the three-mile limit; and, third, the difficulty of getting information to the Fishery Board in order that they may be able to instruct a patrolling boat to get there in time to catch the offender. Of course, the other boat is away long before that can happen. It has been disheartening to inshore fishermen to be told that what they ought to do was to communicate in the first instance with the Fishery Board, for by that time the boat they had seen trawling inshore in the early morning or late at night was—goodness knows where. With the new method of having patrol boats based on the area in which they are to operate, and boats which will be more or less disguised, so that they cannot be recognised as patrol boats until they are on the spot, I think we may hope not only that offenders will be caught, but that would-be offenders may be prevented from offending in future.
    7.52 p.m.
    Sir IAN MACPHERSON: I would like to associate myself with what has been said by my hon. Friend the Member for Orkney and Shetland (Sir R. Hamilton). My hon. Friend is to be congratulated on what is being done. I do not say that everything which we should like is being done, but I think the introduction of these new drifter boats for police and patrolling purposes will be effectual. This morning I had a letter from a very well known fisherman in the Moray Firth, and I would like to draw the attention of my hon. Friend to his complaint. It is not so much a complaint of illegal trawling as of seine net fishing. In the past the cruisers have been used for the purpose of stopping boats which were using the seine net. In some parts of the Moray Firth the seine net is just as abominable to the line fishermen as the illegal trawlers, and this fisherman tells me, and I have no reason to doubt his word, that the seine net fishermen watch the cruiser or drifter, and the moment that she has, quite legitimately, gone to another part to watch the white line nets the illegal seine net boats come in and destroy the livelihood of the line fishermen in the upper reaches of the Moray Firth. I refer particularly to the ports of Avoch,

    1739
    Cromarty, Balintore and Portmahomack, and they even go as far as the constituency of my hon. Friend whom I see sitting on the other side of the House. I, therefore, hope that now that the Department have started the good work they may second—I think that is the proper word—one of these new drifters to that part of the upper regions of the Moray Firth. I am very glad to be in a position to support this Estimate. I think it is one which shows that the Fishery Board of Scotland and the Scottish Office are doing their level best to secure fair play for the line fishermen.
    7.55 p.m.
    Mr. BURNETT: There were one or two points in the speech made by the Under-Secretary about which I was not perfectly clear. One of them was as to the purpose for which these drifters were to be hired, whether they were required, as the right hon. Member for Ross and Cromarty (Sir Ian Macpherson) has said, in connection with seine net fishing or, as the hon. Member for Orkney and Shetland (Sir R. Hamilton) said, for illegal trawling. Everyone will be agreed that efficient policing is necessary, and I think there will be equal agreement among all who have read the reports in the last few years that the policing which has existed was not efficient. We have a number of steam cruisers varying from 25 to 40 years old, and they are continually out of commission undergoing repairs. The repairs bill is out of all proportion to the value which they are, and by the use of drifters or a hydroplane we could accomplish a great deal more than a large number of steam cruisers are doing just now. The Under-Secretary stated that these drifters were required on account of repairs which had been found necessary to one of the boats, but in the Vote it states that the reason is the increased prevalence of illegal fishing. So far as the East Coast of Scotland is concerned I can speak for the constituency from which the bulk of the trawling in Scotland is done, the base from which about three-quarters or more of the trawlers of Scotland set out, and I think I can say that it is true of Abereen that the amount of illegal trawling by vessels from that port is quite insignificant.
    I have heard it said, and I have no reason to doubt it, that the number of
    1740
    skippers who go in for illegal trawling might be counted on the fingers of one hand. Yes, five altogether. According to the figures given in the last three reports there were something like 38,000 sailings of trawlers from the port of Aberdeen, and the total number of convictions during that time was 14, which, I think, is a very small number, taken over three years. Chiefly, it is three trawlers which are repeatedly brought to my notice—three convictions which took place lately. Those certainly were cases of illegal trawling, but they happened after a long period of stormy weather. There is no doubt that most of the illegal trawling which has been done has been the work of men who were "down and out," following a long period of stormy weather. These skippers had sold most of the furniture in their houses, and could not get food for their families, and they did go trawling illegally. I am not excusing illegal trawling, but merely accounting for what happened in the three cases upon which charges against Aberdeen are usually based. I am certain that the amount of illegal trawling along the East Coast is small; but when we pass to the question of seine net fishing it is a different question.
    I asked a question in the House as to the number of convictions for seine net fishing. I cannot give the exact figures, because I could not hear them, and have not got the written reply, but from what I heard there is no doubt that the convictions for seine net fishing during the past three years are very much more numerous than the convictions for illegal trawling on the East Coast. I am told that the seine net boats are smaller and do not make the same comparison. Trawlers vary from about 90 feet to 140 feet, but the smallest trawler is not very much larger than the largest seine net boat. But in any case punishment is not usually inflicted by the foot in the measures which have been taken against illegal trawling and illegal sailing. With reference to the Fisheries Board of Scotland which is considering these policing matters, I should like to know what is the representation of the trawling interests.
    The DEPUTY-CHAIRMAN (Captain Bourne): The hon. Member must postpone that question for the main Estimates.
    Mr. BURNETT: I apologise if I have gone beyond the point, but I thought that that was a question which might concern policing. In the circumstances I submit to your Ruling. There is another point I would like to raise. I raised it in my main question, and it was as to certain trawlers which had been challenged when they were four or five miles from land and were said to have been ordered to heave their gear, and to put out farther to sea. The answer which I got was that these trawlers were not ordered to heave their gear and to proceed to sea, but that occasionally trawlers which were slightly outside the limit were warned, in cases where they were getting too near, and were in danger of getting within the three-mile limit. That hardly meets the question of two cases which have been reported to me, and possibly the Under-Secretary will have them looked into. In one case, a ship called the "Tina Nutting" was fishing at 5 a.m. on 9th September. She had gone six miles east-north-east of Aberdeen, and the distance from land was five miles. She was hailed by a cruiser and ordered to heave her gear and put to sea. She obeyed. The other case is that of the "William Hastie," which was four miles from Stonehaven at 8 a.m. on 11th November. Her skipper was informed that he was too close to the three-mile limit and he was ordered to proceed to sea. The skipper refused, but was not prosecuted. Those are cases where something might have been done to allow the skipper to board the fishery cruiser in order to check his bearings. It is always more difficult for the skipper of a trawler to take his exact bearings than for the officer of the fishery cruiser, because, for one thing, he is not accustomed to the sextant.
    The DEPUTY-CHAIRMAN: It appears to me that the hon. Member is again trying to raise matters which arise on the main Estimates.
    Mr. BURNETT: In those circumstances, perhaps I had better postpone any further remarks which I have to make upon this subject. I hope that the Under-Secretary will consider the points that I have raised. As far as the east coast is concerned, the illegal trawling which is done is insignificant. What we have to consider is the Moray Firth question, and the amount of seine net fishing. It is generally recognised that seine net
    1742
    fishing is a much more destructive form than trawling, and I hope that the result of the effort which the Scottish Office are making will be to put down illegal seine net fishing and that they will not brand trawl fishermen with illegal fishing. I am quite certain that the number who indulge in that practice is extremely small, and is negligible.
    8.4 p.m.
    Mr. BOOTHBY: The hon. Member for North Aberdeen (Mr. Burnett) seemed to be asking as one of the main points in his speech for representation of the trawl fishermen upon this policing commission. He might just as well ask for a representation of burglars at Scotland Yard. He said that there were only few cases of illegal inshore trawling, by a few men who are down and out.
    Mr. BURNETT: From Aberdeen and upon the east coast.
    Mr. BOOTHBY: Yes, but I can only reply to the hon. Member that those fishermen are not so down and out as the inshore fishermen whose sole means of livelihood they have destroyed systematically, month after month and year after year, during the last three or four years. They have become worse and worse. During the last nine months their operations have reached scandalous proportions. They come right in and fish under the noses of the wretched inshore fishermen, and it is not the slightest good the inshore fishermen attempting to complain, because by the time a complaint has got through to the Fishery Board of Scotland, the boats are miles away. One of the worst parts for this sort of thing is that portion of the coast 40 miles or 50 miles north of the constituency of the hon. Member for North Aberdeen, from Aberdeen Bay to Rattray Head. It is one of the best bits of coast for inshore fishing that I know, and I am sure that the right hon. and gallant Gentleman the Member for Caithness (Sir A. Sinclair) would entirely agree with me in that. It is exceptionally good for inshore fishing, and the trawlers come in, on their way back from the main fishing ground in the north. They come right up, almost within 100 yards of the coast, and they sweep the whole of the white fish out of that particular stretch. The hon. Member for North Aberdeen seems restless. Does he want to interrupt me?
    Mr. BURNETT: I should be glad to know whether the hon. Member could

    1743
    bring forward any evidence to prove what he says. Judging from the convictions, there have been very few cases of that kind. With regard to the men being down and out, I am certain that the trawling skippers who have recently been convicted are just as much down and out as any seine net fisherman.
    Mr. BOOTHBY: I do not want to enter into a competition as to which class of fishermen are more down and out, but I think that the trawl-net fishers have suffered less than any other section of the fishing industry during the last two or three years. I can give the hon. Member the evidence of many of them. I can give him the evidence of 5,000 inshore fishermen from the North coast of Scotland to say what the trawl fishermen had been doing. Because of the increased prevalence of this evil, and the hopelessly inadequate means of bringing illegal trawlers to book, I believe that this measure is not only vitally necessary but very much over-due, and I ask the Under-Secretary of State for Scotland whether he will give special attention to the parts of the coast which I have mentioned and which I know have been very inadequately defended. I agree that Moray Firth requires protection too. There is a particular stretch which is very near to Aberdeen, and for that reason the defences may have been more neglected. Upon that stretch there has been very inadequate protection. I ask the Under-Secretary to consider the possibility of placing one of the drifters at Aberdeen itself, Peterhead or Fraser-burgh. From that section of coast the drifter could easily work round to Moray Firth.
    8.8 p.m.
    Captain McEWEN: I congratulate the Under-Secretary of State for Scotland and his Department upon the success of the steps which they have taken to mitigate the evil of illegal trawling. Just for the sake of clearness, I would like to put one question to him. Is this new system, of an agglomeration of drifters at certain points, merely a temporary expedient to bridge over the period between now and the time when further protection vessels have been provided?
    8.9 p.m.
    Mr. HENDERSON STEWART: As we all seem to be staking a claim for Q boats, I feel I must enter mine also.
    1744
    The important part of the coast which I have the honour to represent can certainly make its claim. It is a good claim. In the Firth of Forth at this time there is constant illegal trawling, daily and nightly. It goes on throughout the year, though it is limited in area. The illegal trawling there is intense, and it deserves attention. I should like to put a suggestion in the form of a question. The Under-Secretary has been considering an addition to the number of Q boats; will he consider a proposal to have one or two smaller fast motor boats placed along the coast? This is merely an alternative way of arriving at the same end instead of, or in addition to, the others.
    At the present moment, even with the new drifters, disguised and numerous as they are, there is still a difficulty of getting into touch with them when a case of illegal trawling becomes evident. In the Firth of Forth there have been countless cases of fishermen seeing the boats. They have then had to go to the Fishery Office in Anstruther and the officer there has had to make up his mind whether it was a proper case. That takes him a long time. Then he has had to ring through to Edinburgh with a request for the "Brenda" and by that time the trawler has disappeared. It would be worth while considering the other method of small fast motor boats as an additional means of overcoming the nuisance. While we congratulate the Under-Secretary and his Department upon the steps which they have taken, we must not for a moment imagine that enough or nearly enough has been done to remove this pest from our coasts.
    8.12 p.m.
    Mr. BUCHANAN: I must once more make a statement in regard to what I have been hearing here to-night from hon. Members who represent the sea coast parts of Scotland. The fish supplied by the trawlers has some relationship to the big towns. I have no objection to the Supplementary Estimate, but I hope that it will not be taken for granted that those of us who represent industrial towns, for which an abundant supply of fish is necessary, are consenting to anything further being done outside the three-mile limit. From what I can hear, this Supplementary Estimate is to provide a more effective means of catch-

    1745
    ing the so-called illegal trawlers. The Government are entitled to carry out the law, but, so far as the big towns are concerned, without the trawlers, I am informed, the great mass of the people who consume fish in Glasgow could not be supplied. I am informed that without the supplies which come from the trawlers, the market would to a large extent be ruined and that prices would soar. The consequence would be that the working people would be greatly affected. While there is no objection to the Government carrying out the present law in a more effective way—I suppose that that is the object of the Government—we must not be taken as consenting to anything being done to extend the limit, because that would affect the supply of fish, which is a practical necessity of life to the industrial towns.
    8.15 p.m.
    Mr. SKELTON: My hon. Friend the Member for Orkney and Shetland (Sir R. Hamilton) asked how many drifters were hired, and for how long the Supplementary Estimate kept them. Two were hired from the 1st December, and two in January, and the Supplementary Estimate covers their hiring until the end of the financial year. With regard to these drifters, and also to the various questions which have been raised about seine net fishing in the Moray Firth and so on, I am a little unwilling to state exactly where the drifters are at the moment, because I think that that would be rather a mistake, but I have no hesitation in saying that one of them is on the East Coast at present, and I think it is not incapable of casting an eye on the Moray Firth.
    With regard to the question put by my hon. Friend the Member for East Aberdeen (Mr. Boothby), as to whether these drifters were meant to deal with seine net fishing as well as with illegal trawling, the answer is that they certainly are, and that applies also to the West Coast. I will not give the figures, because they were given to-day in answer to a question, as to the convictions for illegal seining and trawling. I think my hon. Friend knows now that the convictions during the last three years for illegal seining were more numerous than for illegal trawling. I must not, however, be held to convey that anybody could deduce from that fact that there is
    1746
    more illegal seining than illegal trawling. It only means that the seiners are easier to catch.
    Several of the other questions raised seem to me to be, if I may say so, rather beyond the scope of the Estimate, but with the hon. Member for Gorbals (Mr. Buchanan), who raised the question of the general fish supply, we are entirely in agreement, and there is nothing in the policy of maintaining the law which will in any way reduce the fish supplies available for town and country. There is ample room in the sea for the trawler, the seine net fisher, and the inshore lining fisher. The object of this Supplementary Estimate, to the limited extent to which it applies, and for the limited period for which it applies, is to give fair play and a fair place to all the people concerned in the industry.

    POST OFFICE.
    Motion made, and Question proposed,
    "That a Supplementary sum, not exceeding £10, be granted to His Majesty to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1934, for salaries and expenses of the Post Office, including Telegraphs and Telephones."
    8.20 p.m.
    The POSTMASTER-GENERAL (Sir Kingsley Wood): I do not think that the explanation of this Estimate will take more than a few minutes. I saw a paragraph in a newspaper describing the Estimate under the heading "£10 required for the Post Office," but I cannot contend that that is in fact the case, because I shall welcome any contributions. The purpose of the Estimate is to obtain Parliamentary authority during the current financial year for certain expenditure in relation to Post Office publicity, as described in the Paper which is in the hands of hon. Members. The matter arises in connection with a certain form of Post Office publicity, namely, the exhibition of films. As many hon. Members know, while we go in for publicity in the form of newspaper advertising, which we find to be very satisfactory, we also make use of films, and for some time, while the Empire Marketing Board was in existence, we employed their film unit to make some films for the Post Office. When the activities of the Board ceased, it was considered—and this is one of the purposes of the

    1747
    Estimate—that it would be to the advantage of the Post Office to take over the unit, together with the film library. As hon. Members will see from the Estimate, the cost of the whole thing is very small, and the effectiveness of this kind of publicity has been amply demonstrated from the Post Office point of view. The film library was also operated by the Empire Marketing Board, but many of the films were the property of Dominion Governments, and I am glad to say that I have been able to arrange, at any rate for the period covered by the Estimate, that the Post Office shall be able to use the film library, which, with its pictures of life in Great Britain and so many parts of the Empire, affords excellent material for a special series of films depicting those postal, air mail, and telephonic services by which communications are maintained within the United Kingdom. I would only say, in conclusion, that the results which the Post Office has obtained by these methods have been eminently satisfactory, as I think have the improvements that have been made in many of its services. For all these reasons, I ask the House to let me have this Estimate.
    8.23 p.m.
    Mr. MACQUISTEN: I hope that the films to which my right hon. Friend has referred will include a picture showing a cable-layer laying a cable to the Western Isles—to Islay and Mull. A huge population goes there in the summer, and these people are marooned and cannot get in touch with their business. The new steamers are enormously successful in taking that very large population there, and it is essential to business men who go there that they should be able to have telephonic communication with the mainland during their holidays. I prophesied that the steamboat service would pay, and I am told that it is paying, and, if the Postmaster-General would establish a telephone service to Islay and Mull, it would be one of the most fruitful sources of trunk calls in his whole system, because there is no other method of communication. I hope, therefore, that he will endeavour to do that.
    Resolutions to be reported To-morrow; Committee to sit again To-morrow.

  SUPPLY.
    REPORT [5th March].
    Resolutions reported;
    CIVIL ESTIMATES, SUPPLEMENTARY ESTIMATE, 1933.

      Class I.
      1. "That a Supplementary sum, not exceeding £700, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for the Salaries and Expenses of the Department of His Majesty's Most Honourable Privy Council."
      2. "That a Supplementary sum, not exceeding £600, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for the Salaries and Expenses of the Charity Commission for England and Wales."
      3. "That a sum, not exceeding £642, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for the Salaries of the Office of the Lord Privy Seal."

    CLASS III.
    4. "That a Supplementary sum, not exceeding £10, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for the Salaries and Expenses of the Office of Land Registry."
    CLASS VIII.
    5. "That a Supplementary sum, not exceeding £20,000, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for Superannuation, Compensation, Compassionate and Additional Allowances and Gratuities under sundry Statutes; Compassionate Allowances, Gratuities and Supplementary Pensions awarded by the Treasury and, under the Government of Ireland Act, 1920, by the Civil Service Committee."

    CLASS II.
    6. "That a Supplementary sum, not exceeding £272,000, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for sundry Dominion Services, including certain Grants in Aid, and for expenditure in connection with Ex-Service Men in the Irish Free State and for a Grant in Aid to the Irish Free State in respect of Compensation to Transferred Officers."
    7. "That a Supplementary sum, not exceeding £30,000, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for a grant to the Empire Marketing Fund, including a Grant in Aid."

    CLASS VI.
    8. "That a Supplementary sum, not exceeding £10, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for the Salaries and Expenses of the Ministry of Transport under the Ministry of Transport Act, 1919; Expenses of the Railway Rates Tribunal under the Railways Act, 1921; Expenses under the London Traffic Act, 1924, and the London Passenger Transport Act, 1933; Expenses in respect of Advances under the Light Railways Act, 1896; Expenses of maintaining Holyhead Harbour, the Caledonian Canal, Crinan Canal, and Menai Bridge; Advances to meet Deficit in Ramsgate Harbour Fund and for Expenditure in connection with the Severn Barrage Investigation."

    CLASS II.
    9. "That a Supplementary sum, not exceeding £10, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for the Salaries and Expenses of the Department of His Majesty's Secretary of State for Foreign Affairs."
    10. "That a Supplementary sum, not exceeding £9,000, be granted to His Majesty to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for a Contribution towards the Expenses of the League of Nations and for other expenses in connection therewith, including British Representation before the Permanent Court of International Justice."

    CLASS VII.
    11. "That a Supplementary sum, not exceeding £28,000, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for the Salaries and Expenses of the Office of the Commissioners of His Majesty's Works and Public Buildings."
    CLASS VI.
    12. "That a Supplementary sum, not exceeding £450,000, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1934, for a Subsidy on Sugar and Molasses manufactured from Beet grown in Great Britain."

    CIVIL ESTIMATES (EXCESSES), 1932.
    13. "That a sum, not exceeding £7,366 15s. 7d., be granted to His Majesty, to make good Excesses on certain Grants for Civil Departments for the year ended 31st day of March 1933:

    Amount to be Voted.

    £

    s.

    d.

    CLASS III.

    Vote 7. County Courts

    10

    0

    0

  COUNTY COURTS (AMENDMENT) BILL [Lords].
  Order for Second Reading read.
  8.30 p.m.
  The ATTORNEY-GENERAL (Sir Thomas Inskip): I beg to move, "That the Bill be now read a Second time."
  This is a Bill to prepare the way for a consolidation Bill by removing a number of difficulties in the law pertaining to county courts. There has been no consolidation Bill since 1888. Experience has revealed a number of difficulties, and legislation concerning county courts has produced a certain number of anomalies all of which it is necessary to remove before the desirable consolidation Bill can be prepared. It is not intended to put this Bill into immediate operation. Its operation will be suspended in order that its provisions may be included in the consolidation Bill and in that way brought into force. It contains 36 Clauses, and it covers a great variety of points. I may, perhaps, give one or two illustrations of what may be called the major points dealt with. One is the question of the transfer of proceedings either from the High Court to a county court or from a county court to the High Court. New provisions are made facilitating what in practice it is often convenient and necessary in the interests of justice to do. Another matter dealt with is the form of actions for recovery of land. At present there are two, or perhaps three, forms of proceedings and the Bill simplifies them. The Bill has received the approval in the main of the county court judges, the Law Society, and other representative bodies, and, if the House sees fit to give it a Second Reading, it will proceed in due course to enactment, as it has passed in another place.
  8.32 p.m.
  Major MILNER: I merely rise to give a tentative blessing to the Bill on behalf of those who sit on these benches. I gather that it is really a preliminary Measure with a view to clearing up anomalies and obscurities in the present law and that it is the intention of the Government at a later date to introduce a Bill consolidating the law relating to county courts. That, of course, is a much needed reform, and, while I have not had an opportunity, nor have other Members of my party as yet, of examining the Bill in detail, we must reserve any comments or Amendments to it. Generally I think it should meet with the approval of all parties and be passed into law as soon as possible with a view to the much needed consolidation Bill being brought before the House.
  8.34 p.m.
  Major LLEWELLIN: I wish to give my support to the Bill, which I think is a very good one, and I am particularly glad to hear that it is going to be followed by a Consolidation Bill. It is especially good, it seems to me, in conferring extra jurisdiction in small equity matters on County Court Judges. There is one point on which I should like it to be further extended. Clause 7 gives power to a County Court Judge to act in the administration of the estate of a deceased person. I rather doubt whether those words will cover the construction of a will which only leaves a very small amount, and I would suggest the addition of the words "the construction of a will." It will make a great difference if in these small matters the County Court Judge can not only act in the administration of the estate but also construe the will upon which the final administration of the estate may rest.
  There is a further small point on Clause 19. I should like to see the registrar of the County Court given jurisdiction in small cases under £10 whether the approval of the County Court Judge is obtained or not, as long as the consent of both parties to the action is obtained to the matter being tried by him. There are one or two of our County Court Judges who are very keen on trying all matters themselves, and they keep parties, although they have consented to go before the registrar, at the bottom of the list for a long time.
  1752
  It seems to me that in small matters where both parties consent, the approval of the Judge should not be a necessity before the matter goes before the registrar to be dealt with.
  Another point to which I would like to refer is the new provision in the First Schedule which allows the County Court Judge no discretion to give immediate, or more or less immediate, possession in a case where he is giving judgment for a house or land in respect of non-payment of rent. He cannot give a less order than four weeks from the date of the order. There is much to be said for making the statutory notice in cases of small tenants, who, for obvious reasons, pay their rent week by week, because their wages are received week by week, a fortnight or four weeks' notice before they are turned out of their houses. I think that in general cases that might mean an amendment possibly of the general law, but to give it only as we are doing now in this Bill, where the tenant has not paid his rent and is therefore failing in one of the obligations of his tenancy, seems to be moving in advance of the general law. There may be some cases where, although the action is brought because of the non-payment of rent, there are other circumstances which may make it better that the County Court Judge should make a more immediate order than the four weeks. After all, it is giving time to the tenant—
  Mr. DEPUTY-SPEAKER (Sir Dennis Herbert): The hon. Member may refer to these points concerning the Committee stage of the procedure, but he must not argue a matter which is merely a point for discussion in Committee.
  Major LLEWELLIN: I bow to your Ruling, Mr. Deputy-Speaker, but I understood that on the Second Reading of a Bill we were allowed not only to comment on what was in the Bill, but what, in our view, should be in the Bill.
  Mr. DEPUTY-SPEAKER: That is allowed, and it is common practice by rather stretching the rule to permit hon. Members to call attention to points which they would desire to have amended in Committee. But if the hon. and gallant Member wishes to labour those points with arguments in support of them, it is better that such a debate should take place in

  1753
  Committee. I am only calling attention to the fact that, although he may mention these points, he must not bring forward arguments to support them or anticipate arguments against them.
  Major LLEWELLIN: Of course, I bow to your Ruling. I think I have already made the point I wished to make on this provision in the Schedule, and with regard to the two or three points I have raised, I hope that I have been able to bring them to the notice of the learned Attorney-General. In the main, I think that the Bill must have the general support of Members. It brings up-to-date various points of the law which need amendment, and it gives an extended jurisdiction in small matters in the county court, which, I think, all will agree the judges of those courts are quite fitted to administer, and with those words I beg to support the Second Reading of the Bill.
  8.40 p.m.
  Mr. ISAAC FOOT: As far as I have been able to read the Bill and to consult with my hon. Friends, manifestly it ought to have a Second Reading, although I suppose that in Committee upstairs there will be consideration of the several Clauses. Nothing is raised here of a very contentious nature. Inasmuch as the Measure deals with some points with which the profession has been concerned for some time, the profession will welcome the introduction of the Bill, and wish it a speedy passage through the Committee.

  COUNTY COURTS (AMENDMENT) BILL [Lords].

    COUNTY COURTS (AMENDMENT) [MONEY].
    Considered in Committee under Standing Order No. 69.
    [Sir DENNIS HERBERT in the Chair.]
    Resolved,
    "That, for the purposes of any Act of the present Session to amend the County Courts Acts, 1888 to 1924, and certain other enactments relating to county courts, it is expedient to authorise—

    (a) the payment out of moneys provided by Parliament—

    (i) of such remuneration as the Lord Chancellor may, with the approval of the Treasury, determine to be payable to deputy judges and deputy registrars;

    1754

    (ii) of such contributions as may be made under the said Act by the Commissioners of Works to the expenses of local or public authorities for the purpose of providing court-houses, offices, and buildings for holding and carrying on the business of county courts;

    (b)the payment out of the Consolidated Fund—

    (i) of such sums as may be necessary for making good failures or defaults of the Accountant-General of the Supreme Court in respect of moneys received by him, or securities vested in him, under the County Courts Funds Rules;

    (ii) of such sums as may be necessary to enable the National Debt Commissioners to pay or credit any amount which they are required to pay or credit under the County Courts Funds Rules;

    (iii) of such sums as may be payable under the said Act out of the Consolidated Fund to persons whose accounts have been closed under the County Courts Funds Rules;

    (c) the payment into the Exchequer of any sum by which in any year the aggregate amount of the interest on money invested by the National Debt Commissioners under the County Courts Funds Rules exceeds the aggregate amount of interest due to be paid or credited in respect of that year on money placed to accounts under the said rules. (King's Recommendation signified.)—[Mr. Jamieson.]

    Resolution to be reported To-morrow.

  OVERSEAS TRADE [GUARANTEES].
  Considered in Committee under Standing Order No. 69.
  [Sir DENNIS HERBERT is the Chair.]
  Motion made, and Question proposed,
  "That it is expedient to amend the Overseas Trade Acts, 1920 to 1930, by extending to the thirty-first day of March, nineteen hundred and forty, the period within which new guarantees may be given under those Acts in connection with export transactions, and by extending to the thirty-first day of March, nineteen hundred and fifty, the period during which guarantees so given may remain in force."—(King's Recommendation signified.)—[Lieut.-Colonel colville.]
  8.45 p.m.
  Sir GEORGE GILLETT: I should like to ask whether in the Bill that will be introduced on this Financial Resolution there will be any Amendment with regard to the Export Credits Guarantee Department. I have always wished that when the period was being extended advantage might be taken of such a Bill to extend the valuable benefits that industry has obtained for the purposes of their

  1755
  export trade by means of the Export Credits Guarantee Department. I never could understand why it is limited to our export trade. I would remind the Committee that in the earlier stages, when the first scheme of this kind was introduced, it came in among a number of other Measures with the object of relieving unemployment. The scheme has been gradually enlarged and has become a permanent factor and seems likely to continue not merely for giving help to the unemployed but to help industry in a very direct and practical way.
  I should like to congratulate my hon. and gallant Friend the Secretary of the Overseas Trade Department on the innovation that has been made in regard to guarantees that are now being given, not for special transactions brought forward by firms, which they specially wished to secure because they are rather doubtful whether the payment will be made when it becomes due, but under which the Department is prepared to enter into an arrangement with firms practically guaranteeing 75 per cent. of the whole of the export credit. This new innovation is one which ought to be more widely known among business men. When we consider the great difficulties that industry has to-day with its export trade, not only in regard to the question of exchanges but the financial stability of the firms with which the British houses have been doing business on the Continent, it is a great pity that this branch of the Overseas Trade Department is not more widely used. In that respect I should like to suggest to my hon. and gallant Friend that it might be possible to advertise rather more largely than the Department are doing at the present time. I notice in the statement of accounts that a sum of about £1,300,000 was transferred to the general funds of the nation from the Export Credits Department. A few thousand pounds from that large sum might very well have been used in making the work of the Department more widely known. I wish the Minister could have persuaded the Treasury to devise a financial statement about his Department so as to make its work absolutely distinct, and enable those interested in the Department to see what the exact position is.
  Perhaps I might explain very briefly what happens now under the rules laid
  1756
  down by the Treasury, which virtually ensure the payment of certain liabilities. The firms pay certain premiums and those premiums, which amount to a considerable sum, are taken at the end of the financial year by the Treasury and used in the general cash resources of the nation, the Treasury on behalf of the nation taking the liability that may sometime accrue through the failure of the overseas importer to meet the payment when it becomes due. In one year you may get a seemingly large inflow of money from the Department. I submit that the premiums ought to be set aside for the purpose of meeting any deficit that may accrue eventually. At the present time we have a system of accounts which the ordinary man in the street would find it very difficult to follow. Anyone interested in the Department hardly knows what is going on. I cannot help thinking that it is a great pity that the financial statement has to be made on those lines. If my hon. and gallant Friend could persuade the Treasury to allow us to have this Department treated in the same way that any financial concern would treat payments in and out of that kind, I think it would be for the general advantage of those who are interested in the work. I am very glad that the Government are going to continue the Department for another five years. I only hope that its very valuable work will become much more widely known in the country and that many more firms and business men will take advantage of it.
  8.50 p.m.
  Lieut.-Colonel J. COLVILLE (Secretary, Overseas Trade Department): This Resolution does not ask the Committee to approve any further expenditure of money, but to agree to the introduction of a Bill which will extend the powers conferred upon the Board of Trade by the Overseas Trade Acts, 1920 and 1930, for a further period of five years. A White Paper has bean available since an earlier hour of to-day explaining briefly the reason for the introduction of this Financial Resolution. The Overseas Trade Acts empower the Board of Trade, with the consent of the Treasury and after consultation with an Advisory Committee appointed for the purpose, to give guarantees in connection with the export of goods wholly or partly manufactured in the United Kingdom, other than muni-

  1757
  tions of war. They contain a proviso that the amount of guarantees outstanding at any time shall not exceed £26,000,000. It is not proposed to alter that limit, which has, in fact, never been approached.
  The sum required to finance the Department's operations is voted annually by the House, and I would draw the attention of hon. Members to the fact that for the fourth year in succession we have presented an estimate for a token sum, the receipts from premiums and elsewhere having been sufficient to cover our expenses. There is a widespread belief that the Department exists mainly to finance business with Russia, and that the fact that this Financial Resolution is moved now shortly after the conclusion of the Russian Trade Agreement might suggest that these two things have some connection with each other. That is not the case. The Department does business all over the world, and it is a coincidence that the Financial Resolution should arise at this time. I mention that fact to avoid any misunderstanding. The Russian Trade Agreement stipulates that business with Russia shall be considered for facilities on the same grounds as trade with other countries, each application being considered on commercial and financial grounds only.
  Guarantees are given on the recommendation of an Advisory Committee, of experts in banking, insurance and industry, and the Government, in common with its predecessors owe a great debt to the disinterested skilful and arduous work performed by the committee. Such complaints as are made against the committee are that they take too conservative a view of their responsibilities. This may be due in part to a misunderstanding as to the objects of the scheme. It is not a relief scheme, and the committee are not concerned with employment except in so far as it is promoted by the encouragement of normal trading. In this respect their policy is entirely consistent with that of His Majesty's Government, which, as the Prime Minister reminded the House last week, is directed to the restoration of normal industrial activity.
  While the Committee have set their faces against the use of these facilities for wild cat schemes, they have recommended the Department to go to what they have regarded as the utmost limits
  1758
  of prudence in giving guarantees for reasonably sound business. During the last seven years the guarantees given have covered £47,000,000 worth of exports. Up to the end of December last these guarantees had involved payment of about £350,000, and nearly £100,000 has been recovered from defaulters. The commercial accounts of the Department up to the 31st March, 1933, will be found in the annual volume of trading accounts which has just been published. This shows that as regards the current scheme, which began under the auspices of the Executive Committee on 1st April, 1930, the Committee have been able to show a balance in hand of £1,359,000, which represents a trading result of which I think the Department have no reason to be ashamed. Having regard to the fact that the outstanding liabilities at that date were some £8,000,000, I do not think that we have been excessive in our caution in charging a reasonable premium in order to have some funds in hand. I appreciate what the hon. Member for Finsbury (Sir G. Gillett) has said, and I will bear in mind the points he has raised. I think that the House is in agreement with him when he says that the work of the Department should be more widely known because the help it can give to our export trade is considerable. We are now proposing that it shall go on for a further period of five years so that its work may be continued.
  Resolution to be reported To-morrow.

  BRITISH SUGAR (SUBSIDY) [MONEY].
  Considered in Committee under Standing Order No. 69.
  [Sir DENNIS HERBERT in the Chair.]
  Motion made, and Question proposed:
  "That it is expedient—
  (a) to authorise payment by the Minister of Agriculture and Fisheries, out of moneys provided by Parliament, in respect of sugar and molasses manufactured in Great Britain during the period of 11 months commencing on the first day of October, nineteen hundred and thirty-four, from beet grown in Great Britain of a subsidy at the rates and subject to the conditions hereinafter mentioned, that is to say:

  1759
  Sugar: subsidy to be payable in respect of each cwt. of sugar at the rate at which subsidy would have been payable under the British Sugar (Subsidy) Act, 1925, in respect of that sugar if it had been manufactured during the month of September, nineteen hundred and thirty-four;
  Molasses:

  (i) if the average market price per cwt. of raw sugar for the last quarter of the year nineteen hundred and thirty-four, as certified by the said Minister, is not less than six shillings—no subsidy to be payable;

  (ii) if the said price as so certified is less than six shillings but not less than five shillings and sixpence—subsidy to be payable in respect of each cwt. of molasses at a rate equivalent to one-sixtieth part of the subsidy which would have been payable under the said Act of 1925 in respect of that molasses if it had been manufactured in the month of August, nineteen hundred and thirty-four, multiplied by the number of one-tenth parts of a penny by which the said price as so certified falls short of six shillings;

  (iii) if the said price as so certified is less than five shillings and sixpence—subsidy to be payable in respect of each cwt. of molasses at the same rate as the subsidy which would have been payable under the said Act of 1925, in respect of that molasses if it had been manufactured in the month of August, nineteen hundred and thirty-four;

  (iv) it shall be a condition that the rate of the subsidy payable under the said Act of 1925 in respect of any molasses manufactured during the month of September, nineteen hundred and thirty-four, shall be calculated in the manner prescribed in the preceding paragraphs with respect to molasses manufactured during the eleven months commencing on the first day of October, nineteen hundred and thirty-four;

  (b) to make such incidental provisions, including provisions for the making of advances in respect of the subsidy on molasses pending the certification of the average market price of raw sugar, as are necessary or expedient in relation to the matters aforesaid."—(King's Recommendation signified)—[Mr. Elliot].
  8.59 p.m.
  The MINISTER of AGRICULTURE (Mr. Elliot): I am sure that the Committee will desire that I should say a word on the Motion, particularly in response to the points which were raised last night with great Parliamentary ingenuity by the right hon. Member for
  1760
  Darwen (Sir H. Samuel). My right hon. Friend spoke particularly of the committee of inquiry which was proposed to be set up and asked how far it had proceeded and whether the House would have the advantage of the report of the Committee before being asked to vote further sums of money. The sum which we are now asked to vote for a year is in order to allow the committee of inquiry full time to report. The negotiations with which the Government were concerned, first, in connection with the Lausanne discussions and subsequently with the Ottawa Agreements, precluded the possibility of personal attention being given by the Chancellor of the Exchequer and other Ministers to the problem of the beet sugar subsidy, and, consequently, when we came to the period when the growers would say, "What are you going to do" and the House asking "What are you going to do," and there was a danger of some hasty or ill-considered decision being arrived at, the Government decided to carry on for another year and allow, first, the negotiations within the industry to take place, secondly, to allow the results of that inquiry to be appreciated and, thirdly, to give time for the committee of inquiry to be set up and examine the position as it was after the negotiations within the industry had been completed rather than before.
  The CHAIRMAN: I am afraid that the right hon. Gentleman is now getting beyond the Supplementary Estimate. He is dealing with matters which will require legislation and in answer to an inquiry which the right hon. Member for Darwen (Sir H. Samuel) managed to make, but, while I do not think that I can object to what the right hon. Gentleman has said so far, the question must not be debated.
  Mr. ELLIOT: I was only saying that owing to the remarkable celerity of the Committee this evening it has passed the Report stage of that Vote and is now upon the Committee stage of the Financial Resolution, which is to authorise the new legislation which the Government will introduce if, as I hope, the Committee passes the Resolution.
  The CHAIRMAN: I must apologise to the Committee. I am afraid that I have

  1761
  been troubled with one or two problems at the same time and forgot for the moment exactly where we were.
  Mr. ELLIOT: I am sure that if you told us that it was eight o'clock in the morning when it was eight o'clock in the evening we should hesitate very much before challenging your Ruling. In connection with the committee of inquiry the Chancellor of the Exchequer said:
  "As to what is to happen when the present Subsidy Act expires in 1934 I am not at present in a position to express an opinion, but with a view to receiving guidance on this and other matters the Government have further decided to appoint a committee to inquire into the conditions of the United Kingdom sugar industry as a whole, including production, refining and distribution, and to ask this body to report to them before the present Subsidy Act expires."—[OFFICIAL REPORT, 19th April, 1932; col. 1435, Vol. 264.]
  The reason why we are asking for the present temporary Act to go on for another year is to give an opportunity for the committee to be appointed and to deliver its report upon the subject. There has been no waste of time whatsoever. The sugar beet industry, the factories, and the refining interests, have taken full advantage of the time that has been at their disposal. They have come together and have fulfilled the undertaking for which I asked—namely, that they should co-operate in submitting, as soon as possible, a marketing scheme under the Agricultural Marketing Act and would be prepared to co-operate in due course with the growers of sugar beet in the promotion of a scheme. That was the undertaking for which I asked when I announced the policy of this Measure to the House before it rose for the Summer Recess last year—and the industry has fulfilled that undertaking. It has put forward a scheme and that scheme is now going through the statutory procedure which is required under the Act.
  Sir HERBERT SAMUEL: Without any committee of inquiry?
  Mr. ELLIOT: Oh, no. The final responsibility for the acceptance or refusal of the scheme remains, of course, with the House, and the long-term policy of the Government will of course be affected by the results of the committee of inquiry. The industry is taking advantage of the statutory procedure open to it under an Act which has been on the Statute Book since 1931. That we are all, including
  1762
  the right hon. Member for Darwen, I hope, very glad to see them do. They are not wasting time, but are proceeding with the organisation of the industry by the industry, which is obviously more desirable than the organisation of the industry by the Government. The growers of sugar beet also, I understand, have reached an advanced stage in the preparation of a scheme to regulate the marke
  ting of their products. It is hoped that it may be possible for this scheme to be put into operation for the control of next year's crop. If these two schemes are in operation it will be possible to promote a development scheme under the Agricultural Marketing Act of 1933, and so the whole sugar industry will be organised as a unit. That, of course, does not affect in any way any assistance given by the Government to the industry or the terms under which that assistance may be given.
  Having in view the circumstances of the case and the technical nature of the questions which must arise, the Government have decided to limit the personnel of the committee of inquiry to three, and I am pleased to be able to announce that the Government have been fortunate enough to secure the distinguished services of Mr. Wilfred Greene, K.C., as chairman. I hope to be able to announce the names of the other two members very shortly. This committee of inquiry will have a highly important duty. It will inquire into the conditions of the sugar industry of the United Kingdom, including both home-grown beet sugar and imported sugar, and its inquiry will cover production, refining and distribution. It will be asked, having in mind the changes in the structure of the industry which would follow reorganisation under the Agricultural Marketing Acts, to make recommendations as to the future conduct of the industry, and, in particular, as to the application of State aid in so far as this may be considered necessary. My right hon. Friend the Member for Darwen will see, therefore, that before the Government comes to determine its future policy with regard to sugar, it will have the advantage of the report of an impartial committee which will cover all the aspects of the problem.
  I do not wish to go into details on the general question of the sugar industry. No doubt a more fitting opportunity for

  1763
  that will be found on the Second Reading. But as to the point which the right hon. Member for Darwen particularly stressed, that it was desirable to have as early as possible a commission of inquiry, and to have the terms of the inquiry, I am in a position to say that a chairman has been appointed and that the names of the other two members may be expected very shortly, and that the terms of reference are wide and cover the undertaking that we have given the House. I do not think the House or the country will regret that for a year the question of the future of the sugar industry in this country is to be held over, in view of the historical importance of this industry, its practical importance to the agriculture of this country, its enormous importance to the agriculture of our sugar-growing Colonies, and its importance in world economy, to which the World Sugar Conference now sitting in London bears witness.
  9.10 p.m.
  Mr. ALED ROBERTS: I find myself in agreement with one or two things that the right hon. Gentleman said towards the end of his speech. He said that he did not intend to detain the Committee long because a more suitable opportunity would probably be found on the Second Reading of the Bill to go into most of the arguments. But on the Liberal benches we cannot let a Financial Resolution of this importance and magnitude to pass by without registering the strongest possible protest against the continuance of this subsidy. The right hon. Gentleman has told us what the Government are going to do in regard to the committee of inquiry and why it has not been done before. I do not want to put it too strongly. I have heard some lame arguments in this House from time to time, but, really, to ask the Committee to believe that because the Government were busily engaged at Lausanne and Ottawa it was impossible for them, for a period of about 18 or 20 months since April, 1932, to get even as far as they have got in nominating the chairman of the inquiry, is asking us to swallow quite a lot.
  The Government do not seem to have any real appreciation of the enormous amount of money involved in this matter, and the very great interest which is being taken in it all over the country. This is
  1764
  not a small matter by any means. The money might amount to £30,000,000 or £40,000,000, and if we are to go on the assumption that it does not matter if we leave over the matter for another 12 months, I would like to know what the delay in appointing the committee is to cost the country by way of subsidy. If it carries us on only a year it will cost something like £2,000,000 or £3,000,000 for what might be described as culpable negligence on the part of Ministers. It really is coming to something if the country has to pay £3,000,000 because some Ministers cannot "get down to it" and fulfil the promise made by the Chancellor of the Exchequer in April, 1932.
  If we follow the right hon. Gentleman's statement a little further, we find that we are to have a committee of three and that in the meantime the sugar industry is preparing schemes and reorganising itself so that it may become one unit, as he said. By that means, I assume, we are getting on very rapidly towards a monopoly of the sugar industry, which will enable all the beet growers to recoup, by exploiting the consumer, any losses they may suffer in future from the withdrawal of the subsidy. It is clear that someone has to pay for the continuance of a bounty to the sugar-beet industry, and that if the subsidy is to be stopped arrangements are to be made by which the price of sugar will put the matter right. I find it very difficult to understand how the Government can come along with a scheme like this in this casual way without the most extreme protest having been made, not once at odd times, but year after year, and we make a protest again to-night, not as a matter of form, but because we feel the importance of this thing as a matter of principle and because of the financial cost to the country.
  Some of the strongest protests ever made against this subsidy have been made by the right hon. Gentlemen who are now members of the present Cabinet. Indeed it is only a short time since I was amazed to hear the strength of the language employed by some of them in the Debate on this particular Resolution in 1927. However strongly I felt that I could speak, I know I could not say anything stronger than what one of the Ministers, the present President of the Board of Trade, said on that occasion. He said

  1765
  that the figures were really staggering. At that time they were £10,000,000. He said it was no use our shutting our eyes to the fact that we could not afford to pay subsidies on this scale, and, what was more, we could not afford to pay them in this way. It is when we come to those last few words that our main grievance is reached. The Government of the day were told that in 1927 and we have been asking ever since that some committee should be appointed to let us know in what way this matter would be dealt with. We were told at that time that we could not afford to pay this amount at all and that we could not afford to pay it in this way; but Government after Government have gone on since then paying it in this way, and inquiry has been postponed and postponed again.
  I hope, after what the Minister of Agriculture has said to-night, that the Government are going to "get a move on" in this matter. Perhaps when the opportunity arises, the right hon. Gentleman will tell us whether there is to be any representative of the consumers on this committee of inquiry; also whether the committee will be able to hear evidence from interested parties apart from those actually engaged in the industry. He might also tell us whether the final report will be completed and in the hands of Members long before we hear any more about the renewal of this subsidy either by way of Supplementary Estimate or in the ordinary Estimates of a future year. The present President of the Board of Trade made another remark in 1927 which is as true to-day as it was then. He described this as the worst example of crazy finance he had ever seen. To-night we have heard from the Minister of Agriculture of the extraordinary way in which the Government has dealt with this matter in the last two years, and we are entitled to say, in view of the figures which were brought up last night, that most people if they were honest on the subject would admit that this is a crazy financial scheme, and that the sooner we get to the bottom of it the better.
  9.20 p.m.
  Sir FRANCIS ACLAND: I am not sure that I agree with everything that has been said by my colleague on this subject. I look at the matter from an agricultural point of view. The part of the country
  1766
  from which I come has not had much advantage out of the beet-sugar subsidy. It is not particularly adapted to the growing of sugar-beet and it is a long way from the nearest factory and consequently my friends and I have been for some time trying to work out a similar scheme for the growing of another crop, which is not wanted but which would give a great deal of employment not only in the agricultural industry but in other ways. The delay which has taken place in connection with this matter encourages us to hope that we may be able to work out our scheme and place it before the nation long before Parliament is invited by the Government to come to a final conclusion on the beet-sugar subsidy. Judging by the pace at which the Government are proceeding in this matter I think we are justified in entertaining that hope.
  It has taken the Government 22 months to select one member of a committee. One hopes, from our point of view, that they will take another 22 months to select the second member, and a further 22 months before they select the third member, and that possibly a still further period will elapse before they agree on the terms of reference. The scheme which we are working out is that of growing bananas. Banana growing has this advantage over sugar-beet growing that practically the whole of it has to be done artificially and therefore it employs a great deal of extra labour. Not only does it employ agricultural labour at one time of the year, as is the case in sugar-beet growing, but it will also provide employment in an industry on which we require to concentrate more than anything else, namely the coalmining industry. Our colliery districts are extraordinarily slack, and unemployment is extraordinarily prevalent in that industry. Bananas cannot be grown without coal—constant supplies of coal, coal every day—while as regards the iron and steel industries it is necessary to build large furnaces. In addition to coal and anthracite various other things would have to be brought from South Wales and other districts.
  The CHAIRMAN: May I ask the right hon. Gentleman whether the bananas which he proposes to grow will produce sugar and molasses? I am afraid he is outside the terms of this Resolution.
  Sir F. ACLAND: I am referring to this as an alternative product. Bananas are

  1767
  grown from June to December in hothouses which means more consumption of coal and more employment of labour. It is all being worked out and, as I say, we hope in a few years to be able to put a scheme properly before Parliament and the country. The two crops could be grown, if we only got enough in the way of subsidy—bananas for half the year and sugar cane for the other half of the year.
  The CHAIRMAN: I do not think the right hon. Gentleman can have read the
  Resolution. If he does so he will find that it is confined to sugar made from beet.
  Sir F. ACLAND: Perhaps I may be able to return to the subject on another occasion as it is a matter of great interest. My only point is that with a subsidy of 19s. 10d. per banana we would be able to—
  The CHAIRMAN: Order.
  Question put.
  The Committee divided: Ayes, 201; Noes, 30.

  Division No. 144.]

  AYES.

  [9.24 p.m

  Acland-Troyte, Lieut.-Colonel

  Essenhigh, Reginald Clare

  Monsell, Rt. Hon. Sir B. Eyres

  Adams, Samuel Vyvyan T. (Leeds, W.)

  Everard, W. Lindsay

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

  Agnew, Lieut.-Com. P. G.

  Fleming, Edward Lascelles

  Morrison, William Shepherd

  Albery, Irving James

  Ford, Sir Patrick J.

  Muirhead, Lieut.-Colonel A. J.

  Allen, Lt.-Col. J. Sandeman (B'k'nh'd)

  Fox, Sir Gifford

  Nall, Sir Joseph

  Anstruther-Gray, W. J.

  Fremantle, Sir Francis

  Nation, Brigadier-General J. J. H.

  Aske, Sir Robert William

  Fuller, Captain A. G.

  Normand, Rt. Hon. Wilfrid

  Baldwin, Rt. Hon. Stanley

  Gault, Lieut.-Col. A. Hamilton

  Nunn, William

  Balfour, Capt. Harold (I. of Thanet)

  Gibson, Charles Granville

  Oman, Sir Charles William C

  Banks, Sir Reginald Mitchell

  Gillett, Sir George Masterman

  Ormsby-Gore, Rt. Hon. William G. A.

  Barclay-Harvey, C. M.

  Gluckstein, Louis Halle

  Palmer, Francis Noel

  Beauchamp, Sir Brograve Campbell

  Goldie, Noel B.

  Pearson, William G.

  Beaumont, Hon. R. E. B. (Portsm'th, C.)

  Graham, Sir F. Fergus (C'mb'rl'd, N.)

  Peat, Charles U.

  Bennett, Capt. Sir Ernest Nathanld

  Granville, Edgar

  Percy, Lord Eustace

  Blindell, James

  Greaves-Lord, Sir Walter

  Perkins, Walter R. D.

  Boulton, W. W.

  Greene, William P. C.

  Peters, Dr. Sidney John

  Bowyer, Capt. Sir George E. W.

  Guest, Capt. Rt. Hon. F. E.

  Petherick, M

  Braithwaite, J. G. (Hillsborough)

  Guy, J. C. Morrison

  Procter, Major Henry Adam

  Broadbent, Colonel John

  Hammersley, Samuel S.

  Pybus, Sir Percy John

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

  Hanley, Dennis A.

  Radford, E. A.

  Brown, Ernest (Leith)

  Hannon, Patrick Joseph Henry

  Raikes, Henry V. A. M.

  Browne, Captain A. C.

  Harbord, Arthur

  Ramsay, Capt. A. H. M. (Midlothian)

  Burghley, Lord

  Haslam, Sir John (Bolton)

  Ramsay, T. B. W. (Western Isles)

  Burgin, Dr. Edward Leslie

  Headlam, Lieut.-Col. Cuthbert M.

  Rankin, Robert

  Burnett, John George

  Heligers, Captain F. F. A.

  Reed, Arthur C. (Exeter)

  Campbell, Sir Edward Taswell (Brmly)

  Henderson, Sir Vivian L. (Chelmsf'd)

  Reid, Capt. A. Cunningham-

  Campbell-Johnston, Malcolm

  Hepworth, Joseph

  Reid, David D. (County Down)

  Carver, Major William H.

  Hope, Sydney (Chester, Stalybridge)

  Reid, James S. C. (Stirling)

  Chamberlain, Rt. Hon. Sir J. A. (Blrm., W)

  Hore-Belisha, Leslie

  Reid, William Allan (Derby)

  Chapman, Sir Samuel (Edinburgh, S.)

  Horsbrugh, Florence

  Remer, John R.

  Christle, James Archibald

  Hunter, Dr. Joseph (Dumfries)

  Rhys, Hon. Charles Arthur U.

  Clarry, Reginald George

  Hunter-Weston, Lt.-Gen, Sir Aylmer

  Rickards, George William

  Clayton, Sir Christopher

  Hurd, Sir Percy

  Roberts, Sir Samuel (Ecclesall)

  Cochrane, Commander Hon. A. D.

  Inskip, Rt. Hon. Sir Thomas W. H.

  Robinson, John Roland

  Colville, Lieut.-Colonel J.

  Jackson, J. C. (Heywood & Radcliffe)

  Ropner, Colonel L.

  Conant, R. J. E.

  James, Wing.-Com. A. W. H.

  Rosbotham, Sir Thomas

  Cook, Thomas A.

  Jennings, Roland

  Ross, Ronald D.

  Craven-Ellis, William

  Jesson, Major Thomas E.

  Ross Taylor, Walter (Woodbridge)

  Crooke, J. Smedley

  Kerr, Lieut.-Col. Charles (Montrose)

  Russell, R. J. (Eddisbury)

  Crookshank, Col. C. de Windt (Bootle)

  Lamb, Sir Joseph Quinton

  Rutherford, John (Edmonton)

  Crookshank, Capt. H. C. (Gainsb'ro)

  Lambert, Rt. Hon. George

  Rutherford, Sir John Hugo (Liverp'l)

  Croons-Johnson, R. P.

  Law, Sir Alfred

  Salt, Edward W.

  Crossley, A. C.

  Leckle, J. A.

  Sandeman, Sir A. N. Stewart

  Cruddas, Lieut.-Colonel Bernard

  Leech, Dr. J. W.

  Shakespeare, Geoffrey H.

  Davies, Edward C. (Montgomery)

  Leighton, Major B. E. P.

  Shaw, Helen B. (Lanark, Bothwell)

  Davies, Maj. Geo. F. (Somerset, Yeovil)

  Lewis, Oswald

  Shaw, Captain William T. (Forfar)

  Denman, Hon. R. D.

  Llewellin, Major John J.

  Simmonds, Oliver Edwin

  Dickie, John P.

  Loftus, Pierce C.

  Simon, Rt. Hon. Sir John

  Drewe, Cedric

  Lovat-Fraser, James Alexander

  Skelton, Archibald Noel

  Duckworth, George A. V.

  MacAndrew, Lt.-Col. C. G. (Partick)

  Smiles, Lieut.-Col. Sir Walter D.

  Dugdale, Captain Thomas Lionel

  MacAndrew, Capt. J. O. (Ayr)

  Smith, Bracewell (Dulwich)

  Dunglass, Lord

  MacDonald, Rt. Hon. J. R. (Seaham)

  Somerset, Thomas

  Eady, George H.

  McEwen, Captain J. H. F.

  Somervell, Sir Donald

  Eden, Robert Anthony

  McLean, Major Sir Alan

  Somerville, Annesley A (Windsor)

  Edge, Sir William

  Macquisten, Frederick Alexander

  Soper, Richard

  Edmondson, Major A. J.

  Magnay, Thomas

  Sotheron-Estcourt, Captain T. E.

  Elliot, Rt. Hon. Walter

  Margesson, Capt. Rt. Hon. H. D. R.

  Spencer, Captain Richard A.

  Ellis, Sir R. Geoffrey

  Mayhew, Lieut.-Colonel John

  Spens, William Patrick

  Elmley, Viscount

  Milne, Charles

  Stewart, J. H. (Fife, E.)

  Emmott, Charles E. G. C.

  Mitchell, Harold P. (Br'tf'd & Chisw'k)

  Stones, James

  Strauss, Edward A.

  Tufnell, Lieut.-Commander R. L.

  Windsor-Clive, Lieut.-Colonel George

  Strickland, Captain W. F.

  Turton, Robert Hugh

  Wise, Alfred R.

  Sueter, Rear-Admiral Sir Murray F.

  Ward, Sarah Adelaide (Cannock)

  Womersley, Walter James

  Summereby, Charles H.

  Wardlaw-Milne, Sir John S.

  Wood, Rt. Hon. Sir H. Kingsley

  Tate, Mavis Constance

  Warrender, Sir Victor A. G.

  Worthington, Dr. John V.

  Thompson, Sir Luke

  Whiteside, Borras Noel H.

  TELLERS FOR THE AYES.—

  Thomson, Sir Frederick Charles

  Whyte, Jardine Bell

  Captain Austin Hudson and Commander Southby.

  Todd, A. L. S. (Kingswinford)

  Wills, Wilfrid D.

  NOES.

  Acland, Rt. Hon. Sir Francis Dyke

  Foot, Isaac (Cornwall, Bodmin)

  McEntee, Valentine L.

  Adams, D. M. (Poplar, South)

  George, Major G. Lloyd (Pembroke)

  Mainwaring, William Henry

  Banfield, John William

  Graham, D. M. (Lanark, Hamilton)

  Parkinson, John Allen

  Batey, Joseph

  Griffith, F. Kingsley (Middlesbro', W.)

  Samuel, Rt. Hon. Sir H. (Darwen)

  Buchanan, George

  Hall, George H. (Merthyr Tydvil)

  Sinclair, Maj. Rt. Hon. Sir A. (C'thness)

  Dagger, George

  Hamilton, Sir R. W. (Orkney & Zetl'nd)

  Tinker, John Joseph

  Davies, David L. (Pontypridd)

  Holdsworth, Herbert

  Williams, David (Swansea, East)

  Davies, Rhys John (Westhoughton)

  Jenkins, Sir William

  Williams, Edward John (Ogmore)

  Dobbie, William

  Lawson, John James

  TELLERS FOR THE NOES.—

  Edwards, Charles

  Llewellyn-Jones, Frederick

  Mr. Aled Roberts and Mr. Walter Rea.

  Foot, Dingle (Dundee)

  Macdonald, Gordon (Ince)

  Question put, and agreed to.

  Resolution to be reported To-morrow.

  EDUCATIONAL ENDOWMENTS (SCOTLAND).
  Motion made, and Question proposed, "That this House do now adjourn."—[Commander Southby.]
  9.32 p.m.
  Sir I. MACPHERSON: I had on the Paper to-day a Prayer—Ross and Cromarty Educational Trust Scheme, 1933—but I understand that under the Rules of the House I am not able to discuss that Prayer, because it is not Eleven o'clock at night. I propose, however, to discuss one or two other points, and one of them is the administration of the Educational Endowment Commissioners in Scotland. As the House will remember, in 1928—
  9.33 p.m.
  Major Sir ARCHIBALD SINCLAIR: If the hon. Gentleman will pardon me, might we have a Ruling on that point? It is rather important to a number of us in this House. The Endowments Commission is considering endowments in all parts of Scotland, and it may fall to the lot of any of us to ask to bring before the House a Prayer for the rejection of a scheme. It would be very important for us to know whether, in fact, we are not allowed to bring a Prayer forward except after Eleven o'clock at night, even though it were on the Paper and Members may have come here for the purpose of hearing the discussion and of voting.
  9.34 p.m.
  Mr. SPEAKER: There would be nothing to prevent the hon. Member from moving his Prayer before Eleven o'clock if it were reached on the Order Paper. It has, however, not been reached on the Order Paper, and consequently it could not be discussed now.
  Mr. BUCHANAN: On that point, would it not have been possible, if the Adjournment of the House had not been moved and other items had been open to discussion, for the Prayer to be moved?
  9.35 p.m.
  The PARLIAMENTARY SECRETARY to the TREASURY (Captain Margesson): Perhaps I might say a word. If the Adjournment had not been moved by the Government when it was, it would have been a fact that all the Private Bills, starting with the Public Meeting Act (1908) Amendment Bill and going down to the National Industrial Council Bill, would have been discussed between now and Eleven o'clock. As hon. Members interested in those Private Bills have had no chance of being here either to take part in the discussion of to vote on them, it would not have been fair on the House to discuss them. Consequently, the Government had to move the Adjournment after the Government business.
  Sir A. SINCLAIR: Ought not the Prayer to have been put in a position in which it could have been properly discussed? Surely it is not the same thing to be able to have a discussion on a Motion for the Adjournment as to be

  1771
  able to have it on a Prayer, which Members may be asked by their constituents to move in this House.
  Captain MARGESSON: I think the hon. Baronet misunderstood my point. I was not suggesting for a moment that a discussion of a Motion for the Adjournment was the same as on a Prayer. I was answering the hon. Member for Gorbals (Mr. Buchanan), who asked why the Prayer could not be taken to-night instead of the Government moving the Adjournment, and I had to point out why the Government had to move the Adjournment at that juncture.
  9.36 p.m.
  Sir I. MACPHERSON: I appreciate the point raised by my right hon. Friend the Member for Caithness and Sutherland (Sir A. Sinclair). It is a fact that the administration of the Endowments Commission is causing a good deal of disquietude in all parts of Scotland. My Prayer dealt particularly with the constituency which I have the honour to represent, but I propose, with the indulgence of the House, to raise one or two points outside that Prayer. I was saying that in 1928 Parliament appointed a University Endowments Commission and gave that Commission almost unlimited powers to deal with educational endowments and trusts all over the country. Many of us had very grave misgivings at that time in connection with the powers which were given to this Commission, and we have found, as a matter of fact, that the Commissioners have ridden in many cases roughshod over local and national sentiment. I have no desire to lay the blame at the door of the individual members of the Commission, who have had these powers granted to them by Parliament. I know they are public-spirited men, well known all over Scotland, but my one regret is that they have not paid so far more attention to local sentiment and to the interests of the localities where these various endowments and trusts were established.
  It is clear that in the Act of 1928, though they had these unlimited powers, they had also a certain amount of discretionary power. It was made plain to them that, when they were dealing with these trusts, whether they intended to abolish them or to alter them, they had to
  1772
  do three things: They had to pay attention to the spirit of the founders of those trusts and their intentions; they had, secondly, to pay attention to the interests of the locality; and, thirdly, they had to pay attention to the way in which the trusts had been administered. It is clear that it was not the intention of Parliament at that time that, if those trusts were faithfully administered in accordance with the wishes of the testators, if they were efficiently administered by the existing trustees, and if they were not overcome by the dead hand, that is to say, if they were being utilised for the purposes for which they were meant, the Commissioners should act as they have been doing and interfere with these trusts.
  So far as my own constituency is concerned, I must not discuss that, but I regret to say that I have very serious cases to raise before Parliament. It is not my constituency alone. It is the whole of the country, and I have been astonished to find that in all cases, from the remotest part of Orkney and Shetlands, I believe, to the Butt of Lewis, and from the Butt of Lewis to the Mull of Galloway, there have been cases brought to the attention of Members of this House in which the localities, the communities, have been in one way or another aggrieved by the action of the commissioners. It is well known in this House that, whatever else may be said of Scotland, education has always been a noble rage in Scotland, and anything that interferes with education in any shape or form is apt to be resented unless it is for the benefit of that education. It is not Members of Parliament who attack the commissioners. Recently in the Court of Session we had two most distinguished Judges making observations about the administration of the commission, which I think ought to be brought to the attention of this House. First of all, there was the Lord President of the Court of Session, who said that in many cases the schemes of the commissioners had roused a great deal of public and local indignation. And Lord Sands, whose death we all deplore, who was one of the most distinguished Scotsmen of our time, and whom some of us remember as a Member of this House, said that wherever the commission locate themselves, they disturb the peace of mind and the happiness of

  1773
  the community, and that if Carnegie had foreseen their arrival, there never would have been a Carnegie Trust in the Scottish Universities.
  It is not merely local sentiment that has been aroused, but national sentiment, I feel, has been flouted on more than one occasion. Take, for example, Glasgow University, the principal of which has been writing a protest against the work of the commission. You find no fewer than 11,200 students of all the Universities in Scotland protesting against the disregard of the commissioners for local sentiment, and you have a distinguished educationist like Professor Hector Macdonald, of Aberdeen University, a brilliant scholar, saying:
  "Benefactors expected their wishes to be respected as long as it was possible to do so. If this natural desire is not to be granted, they will devote their wealth to other purposes which are not educational, with the disastrous result that the provision of bursaries for the higher education of the youth of the country will come to be classed with Poor Law relief, or what is euphemistically called 'public assistance.'"
  The strictures of the distinguished Principal of Glasgow University have been more powerful than that, for this is what he said:
  "An acceptance of the contention that bursaries have been rendered unnecessary by the provision of eleemosynary assistance would often render the manse and the schoolhouse ineligible for help. The columns of the 'Dictionary of National Biography' show how much Scotland and the Empire owe to the education of sons of the schoolhouse and the manse. … If a private trust is not to be employed to supply a public need, there are few objects for which benefactions can be made. The effect of the policy of the commissioners must be to decrease, or even to reduce to vanishing point, the number of future endowments for educational purposes. Their action has created the impression that educational endowments are useless and that there is no probability that they will be employed for the purposes designated by the donor or testator. It is matter of common knowledge that testamentary dispositions have already been modified by cancelling provisions for educational endowments."
  Indeed, I heard the other day that one endowment of £25,000 has been alienated from educational purposes because of the presence in Scotland of this commission. This is much more significant. The principal goes on to say:
  "The psychological effect of gaining a bursary is quite different from that of receiving an allowance. If the commissioners
  1774
  are permitted to have their way, they may succeed in increasing the rates, but they will do so by the sacrifice of a great Scottish tradition, and they will render it impossible for necessitous and deserving students of the type to which I have referred to enjoy what has for centuries been the birthright of every Scotsman."
  It is not only that they have disturbed trusts all over the country to the detriment of the education of the particular locality to which these trusts were directed. They have done something else. They have now made it impossible for a boy or girl in any part of Scotland to compete for a scholarship in the place where that scholarship has in the past been competed for, namely, in the locality where the trust was endowed. Every boy or girl, whether from the Butt of Lewis, or the Orkney and Shetland Islands, or from the Mull of Galloway, or the remotest isle, whatever the expense to that poor person, must go to one of the university towns in order to compete for that scholarship. I regard that as a crying shame. As Principal Rait points out, there is a great psychological distinction between the boy who has won his scholarship and the boy who gets what is called a dole from public funds—for it is nothing else—from the county authorities, with or without an examination as the case may be. There is no objection at all to the boy being examined for a local scholarship and these scholarships ought to go by competition to the most meritorious boy or girl.
  We say that the system which has existed in the past is the right system. We have no desire to interfere with the standard which the Education Department in Scotland cares to set up. If they care to set up a high standard in many places, well and good, provided they get boys to reach the standard, but that is not their system at all. There may even be under these endowments which have been left to the Endowment Commissioners, a scholarship, let us say, open to boys in Stornoway in the Island of Lewis. In the past those boys would go to a nearby institute and sit for the examinations without any expense to their parents. You are not dealing with boys who are going to Eton, Harrow or Winchester. You are dealing with poor men's sons under these trusts. You are not dealing with men who are going to have travelling scholarships or big things of that kind, but with the youth of the country who for the first time are

  1775
  attempting to get on the first rung of the ladder in an honourable education. Very often people of this kind in the remote islands are sons and daughters of the very poor, where every penny is carefully hoarded so that in the long run, when the day comes for the boy or girl to go to the university, he or she can go with the feeling in the father's mind that the son or daughter is getting a chance in life which he himself never had. A sum of £10, £15, or £20 to send a boy or girl to Aberdeen is a fortune to these people. Why should they be asked by any Endowment Commissioners or by the Education Department in Scotland to depart from the old system which makes Scottish education from the public school and the secondary school to the university the finest in the world?
  Why should that tradition be broken? It is all because the commissioners come in and say, "We must alter all this." Alter it for what? They cannot point a finger to any secondary school in any part of the Highlands or in any part of Scotland where the education which is given is not first class. Take their leaving certificate. In comparison with any other schools it is as good, if not better. Why compel a boy to go to Aberdeen? If he gets his local scholarship, what happens? He is psychologically feeling a better boy because in open competition with his fellows he has acquired that scholarship. Having acquired it, he has an impetus, along with the help that his parents can give, to go to the university. But what are you asking him to do? Before he gets that first scholarship to which he is entitled in his local school, as has been the case for three centuries in some cases and for a century and a half in others, why should you compel him to go to Aberdeen? The answer is, I suppose, that it gives him a chance to get another scholarship. The boy who has got the psychological feeling that he has conquered in one sphere gets a greater chance of success in conquering another, and, if you are going to say it is necessary for him in order to get a university education that he should not attempt to get a scholarship in a local school, I have nothing more to say to a Department that puts forward such an idea.
  If boys were allowed to have these competitions, as in the past, in the local schools all over Scotland, we should have
  1776
  acquired some success in the machine, but I understand that there may be in the minds of the Scottish Office some objection to it. I fail to see what the objection is. It is said that county councils can give scholarships to boys all over their counties. Far be it from me to say that anything should be placed as an obstacle in the path of the poorest boy on the road to the university, but I was remarkably impressed by a statement by one of the principals of the Scottish University, who said that the boys who were coming up now without any competition practically from the counties were not the same class of boys who came up after competition in the past. If that be true, I say the whole system—or rather the proposed system, for I cannot believe that Scotland will tolerate this new system—is not in accordance with the history of Scottish education.
  Mr. SKELTON: My right hon. and learned Friend said that his view is that the boys coming up from county council scholarships are educationally not of the same class—
  Sir I. MACPHERSON: Not necessarily scholarships; the county councils have the power to give without competition grants for secondary education. My point is this, that the university principal made it perfectly plain that boys who proceed to the university so equipped are not in the same street as the others who have themselves acquired their own scholarships by open competition with their fellows in their local schools. I think I have said sufficient to make it plain that this condition of affairs cannot very much longer exist in Scotland. There is a feeling of indignation in the hearts and minds of everybody with whom I have come into contact, rich and poor alike, a feeling that this is a blow at the great system of Scottish education, a blow at the pride of the boys and girls. They have been content in the past to have their open competition with their fellows and win their way honourably to the university and to distinguish themselves there, and I am certain that if a free vote of the House were taken to-night or if a free referendum were taken in Scotland there would be an overwhelming majority against the proposed system under which education is to be worked by the commissioners, and a glad return to the old days where the man with brains

  1777
  had no obstacle in front of him and could fight his way to the top of the tree.
  9.57 p.m.
  Sir A. SINCLAIR: After listening to the eloquent speech of my right hon. and learned Friend I feel that I have come here to-night all unprepared for what I feel is the task which rests upon some of us who appreciate the invaluable services which have been rendered to Scottish education by the Educational Endowment Commissioners. I am afraid I am all unprepared to fulfil that task and adequately to answer my right hon. and learned Friend. I come unprepared because we had understood that what we were going to discuss to-night was not the whole sphere of work of the commission, but the particular prayer which the right hon. and learned Gentleman was going to move dealing with particular problems affecting mainly his own constituency and, partly, those of other constituencies adjoining. But I feel it my duty at once to join issue with the right hon. and gallant Gentleman on the view which he takes of the work done by the commission in Scotland, and, if he will forgive me for saying so, it struck me that he delivered his speech after a rather more careful study of the criticisms which have been levelled against the work of the commission than of the defence which is to be found for their work.
  Sir I. MACPHERSON: I saw only one defence, and it was the right hon. and gallant Gentleman's.
  Sir A. SINCLAIR: That confirms my suspicion; and the fact that the right hon. and learned Gentleman was cheered by several Members behind him confirms my suspicion that a great deal of the criticism of the work of the Commission is based upon imperfect information about the principles upon which they are working and the results which they have achieved, a lack of information which is really not excusable, because it can be obtained from the very able reports which have been published by the commission themselves and which, I suggest to the House with respect, are deserving of the study of every hon. Member. I would suggest that hon. and right hon. Members should study those reports and read them before they take part in this controversy. My first point is that the right hon. and learned Gentleman's speech was really directed not so much
  1778
  against the work of the commission or of the Act of Parliament under which they are operating as against the Act of 1918, because it was under the Act of 1918 that the obligation was placed upon the local authorities to provide these bursaries. My right hon. and learned Friend may hold very strongly, and express to the House very eloquently, the view that there is something derogatory in a child accepting a bursary provided for him by a local authority—
  Sir I. MACPHERSON: I never said anything of the kind. I said there was a psychological distinction—to the boy.
  Sir A. SINCLAIR: I do not know what is meant by that psychological distinction, but it certainly implies that there is something not so noble or inspiring in accepting a bursary from a local authority as in accepting a bursary from a charitable endowment.
  Sir I. MACPHERSON: After competition.
  Sir A. SINCLAIR: After competition. I do not take that view. But whether that be so or not, the point is that this obligation was laid upon the local authorities by the Act of 1918 and not by the Act which set up the Endowment Commission, and not by anything which the Endowment Commissioners have done. There was another misapprehension in my right hon. and learned Friend's speech. He said that under the Act which set up this commission they were given unlimited powers. So far from that being the case, they have not the power to alter one single endowment in Scotland, not one. Not one single endowment can be altered unless my right hon. Friend, who is the Vice-President of the Committee of the Privy Council for Education in Scotland, approves the report and issues an Order, and if objection is taken to the proposal of the Vice-President to make an Order giving effect to the report, of course he can only make that Order after it has previously been discussed in this House.
  Sir I. MACPHERSON: I have in my hand the scheme about which I entered my Prayer, and the endowment and the trust are altered beyond all recognition in that scheme. The point my right hon. and gallant Friend is making is that that can be done only with the approval of

  1779
  the Secretary of State, and my right hon. and gallant Friend can see from to-night's proceedings how difficult it is to get any disapproval of the Secretary of State's action or any opportunity of altering a scheme once it has been drafted and laid on the Table of the House.
  Sir A. SINCLAIR: I did not interrupt my right hon. and learned Friend at all, but he has already interrupted me twice in the course of the first five minutes of my speech, though I am very glad he did if there was any misunderstanding, because this little discussion must have made it abundantly clear to every Member that whereas my right hon. and learned Friend stated that the Educational Endowment Commission have unlimited power, this shows that they have not the power to alter one single endowment. The document which my right hon. and learned Friend is holding in his hand is a draft scheme. That draft scheme has to be submitted to the Scottish Education Department and considered by them. They have to give further opportunities to objectors who may be affected by it to make their objection known. Two months are allowed for that purpose. Then, no Order in Council can be obtained unless that scheme is approved by the Scottish Education Department and by the Secretary of State for Scotland; and even after that, if they are prepared to approve it, they again have to allow a further period of two months, and again the objectors have the right to come before this House and have this scheme discussed here. Therefore, no scheme drafted by the commissioners can obtain sanction and come into force without the approval of the Scottish Department of Education, of the Secretary of State for Scotland and of this House.
  Then my right hon. and learned Friend spoke—this is one point which, I think, ought to be referred to—of an obiter dictum of Lord Sands in relation to a particular endowment which has been discussed in the Court of Session, and in which it was stated that if Mr. Andrew Carnegie had known that there was to be a Commission which would use endowments this way, he would never have left his money to educational endowments. My right hon. Friend did not say that that assertion had been very effectively answered by a close and intimate friend
  1780
  of Mr. Andrew Carnegie, to whom Mr. Carnegie entrusted the administration, as chairman, of the endowments which he left to Scotland and of his great charitable bequests. That was Lord Elgin. Lord Elgin quoted a letter which Mr. Andrew Carnegie had written to him bequeathing to him those great resources for public purposes in Scotland. In the letter, Mr. Carnegie referred to the necessity of constantly keeping up-to-date the methods employed for the useful expenditure of the resources and for meeting, by means of those resources, fresh needs as they arose.
  My right hon. and learned Friend referred to some anonymous benefactor who, on account of the intromissions of this Endowments Commission, had decided not to leave a particular sum of money for educational purposes. Obviously it is everybody's right to criticise any policy when they think it wrong, and I should be the last person, and it would ill become me, to object to criticism, but I think that it is undoubtedly fair to say that if any benefactors have been frightened off, it is by a great deal of criticism of the rather ill-informed and reckless kind which has been levelled at the Educational Endowments Commission. The same kind of criticism was levelled against the Commission which was appointed by the House in 1882 to do the same work, which they carried out in the same way. That Commission acted in exactly the same way as the present Commission by interfering with a lot of old trusts, and resources which were under the control of those trusts they released for new purposes. They met exactly the same kinds of criticism in carrying out that work, but the time passed and much of the criticism was disproved and much was forgotten, and the flow of endowments started afresh.
  I have no doubt that benefactors, when they look back upon this Commission and its work in co-operation with the Secretary of State for Scotland, the Educational Department and this House, will see that there is, in the work of such a Commission, a guarantee that money will not be allowed to be wasted in trusts which are positively forgotten. Money has been lying in trusts about which nobody has known, lying unused because it was devoted to purposes which are met from State funds. For example, there

  1781
  was a great deal of money which had been left to provide free schools, which of course the State has done, and now there is money which is no longer required for bursaries which it is an obligation, under the 1918 Act, of local authorities to provide with the help of the State. There was in 1882, and there is now, a need for a Commission to go round to release resources which, under the terms of a will, have to be devoted to purposes which are no longer required, and to apply those resources to the fresh educational needs which we all know exist in Scotland.
  Such was the recommendation of Lord Mackenzie's Committee, and such was the case which was made here in this House for the appointment of the Commission. In the work which the Commissioners are doing they are only carrying out the recommendations of Lord Mackenzie's Committee and the directions which they received from this House. My right hon. and learned Friend referred to what is the main thing which we have to keep in mind when we are discussing this matter, the interest of the children. He said that it was the birthright of children to obtain a university bursary, and he contrasted that—here I have a phrase which I had forgotten when the right hon. and learned Gentleman interrupted me before—with what he described as "the dole from public funds."
  Sir I. MACPHERSON: It is not a phrase of mine.
  Sir A. SINCLAIR: The right hon. and learned Gentleman used it. I do not see anything derogatory in a child obtaining what I should prefer to call a bursary from public funds. That, at any rate, is the law of the land, under the 1918 Act. Every local authority has to submit a scheme to the Scottish Education Department to provide those university and other bursaries, and that scheme has to be approved by the Scottish Educational Department as an adequate scheme. Under the Act, and under such schemes, the amount devoted to bursaries has risen from—I cannot charge my memory with the exact figures—£90,000 odd in 1920, to £230,000 odd in 1932, a sum no less than three times the total amount of money available for this purpose from endowment funds, as reported by the Mackenzie Committee in
  1782
  1927. That is the main source from which these children can obtain their university bursaries, but there are special kinds of bursary for which there is great need.
  The right hon. and learned Gentleman referred to the poverty of some of these children. Many of the bursaries that are given by local authorities are not enough for the child. I know of one case in which there were several children who could have had a bursary, but who had to be passed over because they could not afford to pay and to live in the University away from their homes. That is where the Endowments Commission comes in. They say "We will apply this bursary money in order to give a larger bursary where necessary, and in order to enable a deserving boy to go to a University." There are cases in which a boy's parents may have a certain amount of money which is too much to entitle that boy to a bursary from the local authority, and yet the boy may be very hard put to it when he tries to maintain himself at a University. The Commission allow bursaries to be applied in that case. In nearly all their schemes, provision is made for the payment of University bursaries at the discretion of the governing body, and also in nearly all their schemes there is representation on the governing body for at least one of the Universities concerned.
  The right hon. and learned Gentleman says that he knows of such a case as a trust created in favour of boys of a particular name in a particular village, but I believe that the children of Scotland as a whole, and the parents of Scotland as a whole, do not think that that is altogether a good system in these days. It is not right and fair that special advantages should go to boys of a particular name in a particular village, when alongside that village there are other boys, just as good and perhaps better, who cannot get similar educational facilities. On the one hand, as I have said, these University bursaries can be obtained now from public funds, but, on the other hand, there are numerous cases, which are now recognised, of real educational need for which no adequate provision is made by local authorities—for example, playing fields, travelling scholarships, and many other things which are referred to in the Report of Lord Mackenzie's Committee, which was before the House when we set up this

  1783
  Commission, and to which we instructed the Commission to give effect. It is not for us now to complain if the Commission come back to us and say that they have given effect to the instructions which we gave to them in the terms of Lord Mackenzie's Report when the Commission was set up.
  I concede most warmly to my right hon. Friend what I have stated publicly before, namely, that it is most important that the Commission should make every effort to meet reasonable criticism. Many weighty criticisms have been brought against these draft schemes in different parts of the country, but that is hardly a matter for surprise. There are 1,410 of these endowments which are being examined by the Commission. The task is one of enormous complexity. In some cases the trust is moribund; it is not being administered for the purposes for which it was set up; it is extremely difficult even to get information about it; and in the case of many of these trusts, which are very important, very complex factors have to be taken into consideration. Parliament foresaw that, and made arrangements for an elaborate procedure allowing for the review of these commissioners' draft schemes at successive stages. There are public inquiries into the schemes. The objectors first of all get the draft scheme; then they have an opportunity of appearing at a public inquiry; then they are told the result of the inquiry after the scheme has been submitted to the Scottish Education Department; then they are given facilities for making their representations to the Scottish Education Department; then they have another two months; and, if they are still not satisfied with the decision of the Scottish Education Department and the Vice-President, they can ask their Members of Parliament to bring the scheme to this House.
  It is certainly important that the commissioners, at the different stages at which they are in charge of these proceedings, should give every consideration to reasonable criticism and to the many weighty objections which inevitably have to be brought against these schemes. Lord Mackenzie's Committee—which I have quoted several times already, because it is the very basis of the work which the commissioners are
  1784
  doing—warned the commissioners, in anticipation, that the judgment of Scotland on their work would depend upon the discrimination which they showed in the exercise of their powers and in meeting reasonable criticism; and certainly I hope that they will make, and I have every reason to believe that they are making, in the case of the majority of schemes, every effort to do that. An immense amount of work has been done by the Commission, quietly, without objection, Without attracting hostility and therefore publicity, and I am sorry that my right hon. Friend did not pay tribute to that uncontroversial work. I feel sure that any Debate in this House, if it calls the attention of the commissioners to the importance of carrying public opinion with them—and I am sure that that criticism which is best informed will carry the most weight with the Commission—will be helpful to them in carrying out their tasks, and will enable them, in co-operation with the Scottish Education Department and the Vice-President, to complete a work which is fraught with promise for the future of education in Scotland.
  10.20 p.m.
  Mr. THOMAS RAMSAY: I was rather surprised at the trend and the tone of the right hon. Baronet's speech. We are always proud in Scotland to have bursaries which have been given for certain localities and to certain names by people who have been very fond of the district in which they were born, and who made up their minds that their names should be perpetuated in that noble way. Yet the right hon. Baronet tells us "Why should you leave money? Posterity will come along and confiscate it. It can do what it likes." I am sorry he has moved so far along the path of Socialism. I do not agree with that doctrine. If a man snakes a trust deed, leaving his money in a particular direction, he has the hope that future generations should respect his wishes. In my constituency there is a high school called the Nicholson Institute, which was provided by two or three members of the family of Nicholson. It is one of the finest secondary schools in the United Kingdom, and there are two bursaries attached to it of which the people in the Western Isles are extremely proud. Yet, according to this scheme, these boys have to go to Glasgow, Edin-

  1785
  burgh, Aberdeen or St. Andrews, whereas provision is made for them locally under the Department of Education examinations. If these examinations have been deemed sufficient in the past, why should they not be deemed sufficient in the future?
  The right hon. Baronet made a point of the democratic nature of the new scheme. I fail to see it. On 25th November the Lewis District Council sent a letter to the Scottish Office protesting on these very grounds which I am bringing forward of the high cost involved for these students. In many cases it takes away half the first year's bursaries, so great is the expense. For boys to go from Lewis to Glasgow, Edinburgh, Aberdeen, Dundee or St. Andrews the cost is very heavy. Yet this is called a democratic system. I fail to see where the democracy comes in. These objections that I am making were made to the Scottish Office three months ago, and I do not know what is in the mind of the Scottish Office to this day. I protest most strongly against the scheme.
  10.25 p.m.
  Sir PATRICK FORD: The right hon. Baronet would almost have persuaded me that he had an excuse in being taken unawares had I not observed the sheaf of notes from which he was speaking.
  Sir A. SINCLAIR: The hon. Baronet is at liberty to examine them. He will find that they refer to nothing but the remarks made by my right hon. Friend. I ask him to accept my assurance that I have made no notes.
  Sir P. FORD: I am perfectly prepared to accept that but, from the length at which he spoke, I should have thought he had primed himself upon the subject, as indeed it was his duty to do. What was it that he was arguing? The right hon. and learned Gentleman the Member for Ross and Cromarty (Sir I. Macpherson) very properly objected to any system that was going to supersede a scheme which some pious benefactor had laid down in which intelligence, enterprise and energy played a part. I believe that we got a much better type of scholar under the regime to which the right hon. and learned Gentleman referred than under that which the right hon. Baronet appears to prefer. I understand his passionate defence of the chairman of the Commission of the same political com-
  1786
  plexion as himself, but I have always been told that retrospective legislation is bad, and that secondary legislation is dangerous. I do not care what Government did it, but for a Commission to be entitled to go back upon the well-considered wishes of private benefactors and to turn them down and mould them to their heart's desire is retrospective legislation. It is not done by an Act of Parliament. It is secondary education carried out by the powers foolishly entrusted to that Commission. You have retrospective and secondary legislation in this case.
  What is it they are doing? Suggestions are made by whoever approves these schemes which are entirely different from the desires and wishes of the people who want to encourage those of their own name, parish and district to get certain facilities for their better education. Absolutely in opposition to all that sort of thing, the Commission come along and say that it is obsolete and out of date, and that they will turn those things on to research and to things which they like. I do not think the right hon. Baronet could deny that in the west and the east of Scotland it is drying up the fountain of benefaction for higher education in Scotland, a higher education not for people of aristocratic origin or of wealth, but of people who, irrespective of their wealth or social position, show that they have the faculty for making good the opportunities they have received. This is all to be driven out as a dead letter by a dole from the funds of the local authority. If that does not work, then the funds left by the pious founder for the purpose of education is to be given over to research or something of that kind. It is ridiculous—I do not know why the House ever did it—and I certainly hope that as a result of this discussion to-night Scottish Members will rise up and say that when this Commission comes to an end it shall not be renewed. It is a preposterous thing that a certain number of gentlemen, however good their intentions, and whatever their political complexion may be, should be able to do that against which we protest. When a person has left his money for certain purposes, reasonable in themselves, if they are hopelessly out of date, by all means do something about it. But we have the Marr College, which has been absolutely held up. The right hon. Member for Caithness

  1787
  and Sutherland (Sir A. Sinclair) says:
  "That rests with the Education Department. It is an affair of the Scottish Office."
  What can the Education Department or the Scottish Office do? They can remit back to the Commission the draft of a scheme. They cannot say, "We want you to adopt this or that." If the Commissioners are recalcitrant, they can send back perhaps an amended scheme but one that is quite impossible. So the thing goes on indefinitely, and the whole benefaction is held up indefinitely. To may mind, it is a travesty of democracy, a travesty of the real interests of Scottish education. We used to be proud of our Scottish education, but in recent years we have been compelled under a succession of Governments, to admit that perhaps we are rather below the English standard, whereas we used to boast, perhaps vain-gloriously, that we were above the English standard. I appeal to my Scottish friends to reject the spurious argument of the right hon. Member for Caithness and Sutherland and to support the argument of the right hon. Member for Ross and Cromarty.
  10.32 p.m.
  Mr. JAMES REID: There is no doubt that Scotland as a whole is strongly against the kind of thing that has been going on recently. The right hon. Member for Caithness and Sutherland (Sir A. Sinclair) is in a smaller minority in his views on this question than he is on his views on other political questions. Do let us put the blame in the right place. The blame does not rest primarily upon the Commissioners but upon us in this House. We were stupid and misguided enough at the beginning of this Parliament, at the instigation of the right hon. Member for Caithness and Sutherland, to pass a thoroughly bad Act. Let us admit it and get it off the Statute Book.
  Sir A. SINCLAIR: I should be delighted to stand up to that responsibility as far as it is mine, and I fully accept every bit of it. I do not wish to get out of one scrap of it, but when my hon. Friend says, "Let us be quite certain about the responsibility," I think it is only right to point out that the Commission was appointed originally by the Conservative Government in, I think,
  1788
  1928 or 1929. It was appointed in accordance with the Report of Lord Mackenzie's Committee.
  Mr. REID: The point is that the enormity of the Act only becomes apparent in operation. When the Act was passed it looked a fairly inoffensive Act. It is true to say in mitigation of the right hon. Gentleman's advocacy of the second Act that even at that time things had not developed to the extent that they have now, and it was still possible to argue that the Act was going to be inocuous. For that reason a number of us, who ought to have been more wide awake, let it go through, and the result of that is becoming more alarming every day. Therefore, the real blame rests upon us for passing an ambiguous Act which we thought would be all right, but is not. The blame does not rest with the commission, who have been doing their best in extremely difficult circumstances to carry out what they think is the true intention of the Act. If the Act is ambiguous it is our fault. Nobody can suggest that the commission have not been trying to give their view of what the Act means. Do not let us blame the Scottish Office too much, for so long as an Act of Parliament is on the Statute Book it is the duty of the Scottish Office to carry it out according to their view of its meaning. I sincerely hope that their view of its meaning does not coincide with the commission's view. I am not sure that it does. Do not let us discuss the schemes which are not yet confirmed, because it may be that the Scottish Office take a different view of the meaning of the Act than the commission have taken.
  I want to add my word to that of the hon. Member for North Edinburgh (Sir P. Ford). Let us, at the first opportunity, get this out of the way; in any event do not prolong the Act at all when it comes to an end, let it come to an end, and, when the term of office of the commission comes to an end, let them go out of existence, they should never have been there at all. In that case the Scottish Office would be left in charge and there would be an appeal to the Court of Sessions, who take a reasonable view as to how testators' intentions are to be carried out. It is all very well for the right hon. and gallant Member for Caithness to put forward the Socialist idea that a testator's money can be taken

  1789
  away from the purpose for which he left it. In the same way that Socialism in the wider sphere would dry up the sources of wealth so in this sphere Socialism would dry up the sources of wealth of testators. I hope that the Government will take the first opportunity of getting rid of this Act and, while thanking the commission for their services—I am not speaking ironically, as they have done their best in difficult circumstances and we must give them credit for it—in this way get rid of the whole thing.
  10.40 p.m.
  Mr. SKELTON: Much has been said in criticism of the commission, and my first word must be to say that the proper target for criticism is the Scottish Education Department and the Secretary of State and myself who are responsible for the policy of the Scottish Education Department. As there is a division of work between the Secretary of State and myself and as the Secretary of State has given me the work of dealing with the administration of the Education Department, the only proper target therefore for criticism is the Minister responsible for the Department which has the duty of considering and approving the draft schemes of the commission or of remitting them back to the commission on points where we think they have gone astray. Therefore, the attack should be made upon the Minister concerned, and I should not therefore, as a result of this Debate, have to defend in detail a commission whose work it is my own duty to criticise, to consider and inspect, from time to time.
  There is, however, a more important reason why the responsible Ministers should be the target of criticism. The commission is the child of Parliament. It was set up by Parliament, and its duties were clearly set out in the Act. Therefore, to criticise it is clearly a case of the bullet going to the wrong billet. A number of draft schemes framed by the commission have been the subject of some criticism. With the possible exception of the Marr College scheme none of these schemes have yet been approved by the Education Department. Many of them are schemes that raise difficult questions. At this particular moment we are engaged in discussion with the com-
  1790
  mission as to alterations, amendments and all the rest of it. I beg the House not to regard a draft scheme in its first form, as this is, as a finished article.
  One other general observation I will make. As the House knows, any petitioner can petition this House to have a scheme considered by the House. Up to date there have been passed no fewer than 89 schemes, and in the case of only three have there been petitions for the House to consider. [An HON. MEMBER: "That shows how difficult it is."] It does not show how difficult it is. It is perfectly easy to bring the matter before Parliament. There may be technical difficulty as to the time when the Prayer discussion can be taken, but there is no difficulty in bringing the scheme before Parliament, because two months are allowed under the procedure for that to be done. As to the functions of the commission, I would point out that this is the second commission to be appointed. The function of the first, appointed in 1882, was in the same way to revise the existing educational endowments. It was to see that the then educational endowments were applied to what then seemed to be up-to-date purposes. The main purpose at that date was the furthering of secondary education.
  A great many of the bursaries which are now being dealt with by the commission, or some of them, were in fact brought into being by the previous commission. One of its other functions was to provide what in Scotland are called hospitals, that is to say institutions in which poor children were maintained and educated. Many of these bursaries, whose age-long characteristic has been eloquently described to-night, were the child of the first commission. The work of the commission as set out in the Act is mainly to bring educational endowments up to date. What are the new objects for which endowments are being given? They are such things as hostels into which children go from the rural areas, and where they can be properly looked after. I can hardly imagine anything more likely to add to the value of secondary education, and to add to the safety of rural children going for the first time into a town, than that at the age of 14 or 16 they should be properly looked after in these hostels. Then there are such things as the provision of playgrounds, and of travelling scholarships for those going into agricul-

  1791
  tural work. I cannot imagine anything more likely to enlarge the outlook of a young man going into modern agriculture than that, after leaving the secondary school, he should get from the local education authority a travelling scholarship in order that he may see the work being done in Denmark, or Holland or further afield.
  The objects to which the money previously spent on bursaries is now in many cases being devoted by the Commissioners, are objects which really bring these educational endowments into line with modern educational purposes. The general form of the Commission's scheme is not to lay down hard and fast rules under which the endowment money can be used. The general form of the scheme is that the local education authority should frame a scheme for the use of the money, and the Commission only lays down a wide variety of subjects for which the endowments can be used. That scheme again has to be approved by the Education Department. So far as I can judge the main advantage of that system is that it gives the necessary elasticity. I am convinced that educational requirements change from generation to generation and from decade to decade and it is of importance that the money should not be bound in irons, under hard and fast rules but that there should be elasticity in the use of these most valuable endowments. That elasticity is almost invariably secured. The general course of the speeches this evening would suggest that bursaries have been entirely swept away by the Commissioners but that is not so. In the very scheme which my right hon. Friend would have dealt with in more detail had opportunity offered, no less than 18 bursaries are maintained for children going to the universities.
  The general principle is that where endowments are given specially for the poor they must be used under the commission's scheme for the poor, but they need not be kept in the form of bursaries. Since the Act of 1918 it has been the duty of education authorities to see that no poor child is deprived of further education on account of want of means and as my right hon. Friend has said £230,000 a year is spent in Scotland in that way. Where the bursary is of a kind which is not confined to the poor but is a general competitive bursary, that bursary is not
  1792
  swept away by the commissioners, and as I say there are 18 of these under the Ross and Cromarty scheme. My right hon. Friend made a reference to competitors having to go to the universities "to sit the examinations" as we say in Scotland. That does not apply of course to bursaries for the poor. It applies to these competitive bursaries. The scheme provides that if no competitor is of a sufficiently high standard in a given year the bursary is not awarded. That provision, I think, is right because it tends to raise the level of education. But competitors have now to sit the examinations in the university because thus and thus alone can any real standard of competition be arrived at. Every young person sitting for a bursary examination in a university has an opportunity of also gathering in, if he is lucky, another bursary or if he is still luckier, picking up one of the bursary plums of a Scottish university.
  In general, where you have a definitely competitive bursary, where the main object is not to give a poor person a bursary but to pick out the best person and, if you do not get a sufficiently good person, not to award a bursary, then there is, in the interests of education, an immense amount of force in the view that these examinations should be conducted at universities where the bursary is to be held, and that successful competitors for a bursary should compete not merely against the people of their own districts, but against the competitors for all the competitive bursaries. It was by no oversight on the part of the Department of Education that that feature of the scheme was confirmed. We did it, because we believed that it was in the interests of university education and of boys and girls who were going to the universities.
  Let me conclude by saying that if this provision or any other provision in a scheme turns out in practice to be unsatisfactory when the stage of the Commission is closed—at best it will clearly be over in the course of a year or two—as soon as the Commission's work is over it becomes the function of the Scottish Education Department thereupon to make any necessary alteration in the scheme. If in the course of a year or two this criticism or that criticism turns out to be well founded and our judg-

  1793
  ment in approving a scheme turns out to have been fallacious, the scheme can be altered. There is nothing there hard and fast or ironbound. It was neither from oversight nor from any desire to do anything but what was best in the interests of education that we considered that the provision with regard to examination at universities was a sound provision.
  Sir I. MACPHERSON: Is there a single body of administrators of any importance in any part of Scotland who agree with that view?
  Mr. SKELTON: I could not answer that question immediately. My right hon. and learned Friend will recollect that the subject he was going to discuss to-night was one scheme only; the general discussion of the commission's policy, and the whole situation has been brought forward owing to the circumstances of the Debate. I will certainly make inquiries on that point. My own view is—and many hon. Members must support the proposition—that if you have competitive bursaries there must be true competition. If you have maintenance bursaries, where poverty is a chief qualification, all you want is a standard.
  Sir I. MACPHERSON: My hon. Friend raised the case of two bursaries which were specifically allocated to the Nicholson Institute, Stornoway. Stornoway is in the Island of Lewis, across the Minch. The proposal is that 20 boys and girls in competition for those two bursaries should not sit for them in Stornoway but should go to Aberdeen to sit for them.
  Mr. SKELTON: As I understand it, the bursaries for which competitors will sit an examination in a university are confined to bursaries which will be held at that university. If my hon. or right hon. Friends think that a bursary can be held at the Nicholson Institute and is to be competed for in Aberdeen or elsewhere, they are wrong.
  Mr. T. RAMSAY: Are these bursaries, as in the past, to be awarded on the results of examinations set by the Department of Education?
  Mr. SKELTON: That is exactly the question with which I am dealing. All that was necessary for apparently competitive bursaries was that a certain standard should be obtained. By send-
  1794
  ing competitors to compete in the bursary examination at the university they will be going in for a really competitive examination.
  Sir I. MACPHERSON: I do not think my hon. Friend appreciates the point. These two scholarships are limited to pupils of Nicholson Institute, Stornoway. They are not scholarships open to the whole university. If that be true, the only people who can compete for those scholarships are pupils of Nicholson Institute, Stornoway, and the only competition which can take place should be in the Nicholson Institute.
  Mr. SKELTON: I am sorry if I have not completely covered this technical point. If it were necessary that the bursaries should be awarded each year, then the argument of my hon. Friends would prevail, but in fact the bursary is a competitive bursary and need not be awarded, and therefore it does not follow that every year, under a proper competitive system, two boys or girls at Nicholson Institute will get the bursary. They must come up to a bursary standard, and the bursary need not be awarded. That is the importance of a competitive examination. If indeed you had bursaries which must be awarded to people at particular schools, it would not be worth while to place them.
  Mr. T. RAMSAY: Is not the examination of the Department of Education competitive?
  Mr. SKELTON: No, it is not a competitive examination, in the same sense, because all that is required for the ordinary bursary is that a certain standard of leaving certificate should be attained, which is quite a different thing from the success which an applicant may obtain in a proper bursary examination conducted by a university. The university has to report to the county council whether they regard the applicant for a competitive bursary as having a sufficient educational standard to deserve it. That is an entirely different case from obtaining two, three, or four passes in a leaving certificate. The new system will be competitive, and I believe that it is of great importance that early in their lives—as the right hon. Member for Caithness and Sutherland (Sir A. Sinclair) said, let us regard this from the point of view of the children, and I do

  1795
  not think the House would think otherwise—young people of striking abilities, from whatever part of the country they may come, should early have the opportunity of being successful in an examination which is competitive for a large range of people of their own age.
  My hon. Friends are interested in the future of these bursaries. Believe me that the successful attaining of one of these bursaries now, after a proper competitive examination in a university, will set a hall mark upon a successful competitor which the mere attainment of a certain number of passes in a leaving certificate could not do. It is, therefore, in the interests of education, which is a
  1796
  matter of quality and not of quantity, that we approve of the provisions with regard to these particular bursaries. I am sure the principle is sound and right, but on the whole matter I should like to conclude, as I began, by saying that we are the proper targets of criticism, and not the Commission, who cannot reply for themselves in this House, and for whom I am loath to reply because I often, in the course of ordinary Government business, find myself seeing not absolutely eye to eye with them. Let us be attacked, and I think we shall be able to defend ourselves.
  Adjourned accordingly at One Minute before Eleven o'Clock.

  FOREIGN GOVERNMENTAL LOANS (BRITISH CREDITORS).
  FOREIGN GOVERNMENTAL LOANS (BRITISH CREDITORS).
  LAND DRAINAGE, SCOTLAND.
  LAND DRAINAGE, SCOTLAND.
  DUTIABLE STORES, PASSAGE SHIPS.
  DUTIABLE STORES, PASSAGE SHIPS.
  UNEMPLOYMENT (LANARKSHIRE).
  UNEMPLOYMENT (LANARKSHIRE).
  CO-OPERATIVE SOCIETIES (TAXATION).
  CO-OPERATIVE SOCIETIES (TAXATION).
  CUSTOMS AND EXCISE STATISTICAL OFFICE (ARMISTICE DAY).
  CUSTOMS AND EXCISE STATISTICAL OFFICE (ARMISTICE DAY).
  MUNITIONS (EXPORT).
  MUNITIONS (EXPORT).
  PIGS (TRANSPORT).
  PIGS (TRANSPORT).
Preamble
The House met at a quarter past four of the clock, The LORDCHANCELLOR on the Woolsack.
DYESTUFFS (IMPORT REGULATION) BILL.
Brought from the Commons; read la and to be printed.
SHEFFIELD GAS BILL. [H.L.]
Read 2a.

SCOTTISH BORDER, ELECTRICITY ORDER, 1934.
THE EARL OF LUCAN: My Lords, on behalf of my noble friend the Earl of Plymouth, I beg to move the Motion respecting the Scottish Border Electricity Order, 1934, standing on the Paper in his name.
Moved, That the Special Order, as reported from the Special Orders Committee on the 22nd of February last, be approved.—(The Earl of Lucan.)
On Question, Motion agreed to.

GREAT YARMOUTH ELECTRICITY (EXTENSION) ORDER, 1934.
THE EARL OF LUCAN: My Lords, on behalf of my noble friend the Earl of
2
Plymouth I beg to move the Motion relating to the Great Yarmouth Electricity (Extension) Order, 1934, standing on the Paper in his name.
Moved, That the special Order, as reported from the Special Orders Committee on the 22nd of February last, be approved.—(The Earl of Lucan.)
On Question, Motion agreed to.

DISEASES OF FISH BILL. [H.L.]
Amendments reported (according to Order).

TRADE AGREEMENT WITH RUSSIA.
LORD PHILLIMORE LORD PHILLIMORE moved to resolve, That this House, taking cognizance of the Trade Agreement recently negotiated between His Majesty's Government and the Union of Soviet Socialist Republics, desires to press upon His Majesty's Government that this opportunity should be taken to make representations to the Russian Government for a wide amnesty of political prisoners and the return to their homes of those in forced labour camps.
The noble Lord said: My Lords, I rise to draw attention to the recent Temporary Commercial Agreement entered into with the Soviet Government and to move a Resolution. It is an unusual thing for this House, or for Parliament, to have the opportunity of

3
discussing anything in the shape of a treaty before it has received ratification. I hope your Lordships will agree with me that we appreciate this concession by His Majesty's Government, and I think we may attribute it to the great interest that is taken in the country, if not in this House, in all commercial agreements or treaties entered into with Russia. The departure is a novel one and there are certain features in this Agreement which are in themselves very novel and very important. There has been a considerable lapse of time since the denunciation from our side of the last Commercial Agreement. That time has no doubt largely been spent in hard bargaining. I think I may say at the outset that I, for my part, should like to congratulate the Government on the result of that bargaining as being at any rate a great improvement on the Agreement that preceded it.
It was as long ago as July 20 that the noble Lord, Lord Mount Temple and I drew the attention of your Lordships to this question. We are here to-day to sing our little duet on the same theme. At that time the noble Marquess, Lord Londonderry, answered for the Government, and we tried to put to him certain conditions regard to which we thought extremely important in the negotiations for the new Treaty, and as to which we were representing a very considerable body of opinion. In the first place we asked that the Soviet Government should recognise the private and public debts owed to our nationals. I regret that no advance can be recorded in this matter. In the second place we asked that the diplomatic immunity with which the Soviet Trade Delegation in this country was privileged should be withdrawn, if only on the ground that it was of no use and that there was no necessity for it, unless it was to cover up propaganda which in its nature was hostile to the institutions of this country. There is no advance to be recorded there.
In the third place we drew attention to the undertaking against propaganda which was contained in the former Agreement. I must confess that I am somewhat relieved to see that there is no mention of this undertaking in the present Agreement. In fact, my Lords, it has plainly come to be regarded as in the nature of what in the Army is called "eye-wash." I think none of us need
4
feel that its omission makes much difference to the situation either one way or the other. At any rate there is no such undertaking in the present Treaty. Then we asked whether export credits were again to be made available for our exports to Russia. They are. I raise no objection to that. If we are to trade with Russia there seems to be no reason why, under the guidance of the Export Credits Advisory Committee, such credits should not be granted. I am thankful that at any rate there is no question of any loan to Russia, but I am astonished that no lien has been placed on Russian property in this country similar to the lien which was arranged in the case of the recent Franco-Soviet Agreement. There it was provided that, whilst the maximum of credit should be 22 months throughout, exporting firms were to draw bills against the Soviet, and those bills in their turn were to be accepted by the Soviet commercial representative in Paris, and secured by a bond on the assets of the Soviet Petroleum Trust. My Lords, if there is a Petrofina in France, there is an R.O.P. in this country, and that company has very considerable pledgable assets.
How was it that we did not obtain the same protection as the French? This is one of the matters to which I particularly drew the attention of the noble Marquess during that debate last July, and I trust that the noble Earl, who is going to reply for the Government, will afford some explanation to-day. I hope he may be able to tell us that paragraph (8) of Article 5 of the Treaty will, in fact, give our exporters the right to have attached—if that is the right word—such property of the Soviet Government as R.O.P. assets, for instance, or other assets in this country. Even if this is so, it will be well for our exporters to be expressly warned that no action will lie in British Courts unless and until the signature of a mysterious person, whose residence in all probability is in Moscow, is first of all obtained to the transaction. It seems that the neglect of any precaution of a financial nature is somewhat odd when one considers the present financial position of the Russian Government. That Government is, if my information is at all correct, I will not say bankrupt, but verging on bankruptcy. It has, I believe, at the present time a debt of some billions of marks to German creditors, with which it has had the

5
greatest difficulty in dealing. Then, as your Lordships are aware who have studied the figures, it has enormously contracted its purchases abroad during the last year, as I am told and have every reason to believe, because it could not afford to pay for larger purchases.
I come next to what we are going to export. Are we going to export the products of our Lancashire and Yorkshire looms, or Northamptonshire boot factories? Are we going to send over to the Russian peasant the bare necessities of domestic use, for which he has been hungering for years? No! my Lords, there is no provision in this Agreement, I regret to say, to give us any more access to the market for consumers' goods in Russia than we have had before. Once again we have allowed the buyer to be dictated to by the seller, because on balance we are very largely the buyer. That is very unusual in business. As a rule it is the buyer who dictates the terms, if anybody does. In this case it is not so. It is said that you cannot dictate to a Government. Then why can the Russian Government dictate to us the terms and methods on which we should trade? I must say it is a great disappointment to me that in this respect there is no advance whatever to be recorded. The Soviet Government can sell to the individual British buyer in this country petrol from its own pump. We have no such contact with the Russian buyer. We have no opportunity of building up good will in the market represented by the huge Russian public.
This Agreement again repeats in almost identical terms the most-favoured-nation clause, a clause which by its very terms is inapposite where a State has a complete monopoly of its foreign trade. There is in addition, unfortunately to my mind, a concession which is rather tucked away at the back of the Agreement, which provides that any country which has entered into a Customs union with the Soviet Government can have this Agreement applied to it; in other words, the Soviet claims freedom to deal outside the most-favoured-nation clause with any country within its Customs union. At the moment that is not important, but it is one-sided, and there seems to be no reason why the same concession should not be given reciprocally to Great Britain. I know it will be said that the most-favoured-nation clause has
6
been modified by the concessions which have been made for the first time in this Treaty. It is true, and I admit it, that the effect of the most-favoured-nation clause has been very much modified by these new terms. At the same time, I fail to see that there was any necessity for including it in the Agreement as it stands.
So far we have not much to be thankful for, but I am grateful that the Agreement is definitely stated in the preamble to be a Temporary Agreement, and subject to six months' notice. In the debate last July the noble Marquess promised very definitely, and we were glad to hear it, that one of the main objects of the negotiations "will be to redress as rapidly as possible the balance of payments." In this respect Article 3, together with the Schedule, provides for a most notable and marked advance. It is satisfactory also to find that British shipping will rank as an export and in that ingenious way obtain the advantages which will accrue through the Russian Government increasing its purchases in this country. But whilst I am on the subject of shipping I should be glad if the noble Earl who is going to reply will tell me whether or not the reservations in the Agreement with regard to coastal trade operate to bar our ships from making voyages and picking up cargoes? I think they are called continuous voyages, but I am not a shipping expert. The sort of case I am thinking of is one in which one of our ships calls in the Sea of Azov and then wants to pick up another cargo at Odessa, and I am not clear whether or not the Russian provisions as to coastal trade debar that,
Lastly, I turn back to Article 2 and the provisions as to dumping. I believe that there is not universal satisfaction at the length of time that must elapse before protests against dumping can take effect. The provision is for a period of three months. It is true that within that period an imminent restriction or prohibition can lead to a good deal of forestalling of the market; but I personally am too thankful that that new principle has been laid down and that practical effect has been given to it, to quibble very much about the length of time, and I am glad to see that the Preferences accorded at Ottawa are in the same way safeguarded. However, though the position of our Dominions and our own position

7
are safeguarded against dumping, no provision has been made to safeguard those foreign countries who most suffer from under-cutting by Russian products, and I refer particularly to that group of northern countries with whom we are doing an important and expanding trade, and whose products are in natural competition with those of Russia. Here I think it is regrettable that we have been able to do so little to protect those friendly countries.
No doubt other speakers will raise other points upon this Agreement. I would pass, if I may, to the Resolution which I have put down, and which deals with an amnesty to the political prisoners, and particularly to those interned in the forced labour camps. You will have seen that I have asked if our Government cannot find it in its heart to make representations to the Soviet Government of a friendly character, representations which I hope may induce them to afford a wide and generous amnesty to their political prisoners, and more particularly to those in the forced labour camps. I am anxious on this occasion to say nothing that is the least provocative, but I am convinced in my own mind—and I wish that I could convince your Lordships and the Government—that this opportunity should be taken. We have, after all, entered again into friendly relations with the Soviet Government, and it is a friendly representation that I am asking for. We have only a few weeks ago made representations for a policy of conciliation and appeasement to the Austrian Government on behalf of their citizens taken with arms in their hands, actively prosecuting warfare against the forces supporting their Government. In the face of that, is it possible for us to say that what is not an unfriendly action in the case of Austria is an unfriendly action in the case of Russia? It passes my imagination how those two positions can be maintained at one and the same time.
This is no small question. I do not think it will seriously be disputed that there are in Russia and Siberia to-day some hundreds of thousands, if not millions, of political prisoners, for the most part condemned to forced labour under the severest possible conditions. It is known to your Lordships that much of the White Sea timber trade is conducted by these means. It may not be so well
8
known to your Lordships that all the recent railway construction and all the railway construction in the Soviet Republics that is now going on is also being carried on by huge camps of forced Russian labour. It is said that in one camp, although I can hardly believe it—we will say one series of camps—alone, the stretch by the Baikal-Amur Railway now being built, there are no fewer than 450,000 prisoners at work. It is a whole nation, or what is the equivalent of a whole nation, that is condemned to prison.
If your Lordships would be good enough to read the Slavonic Review of January, 1934, published by London University, you would see there an article by a Professor Chernavin, a distinguished scientist who lately escaped from Solovetsk Prison Camp, in which he works out, as far as his knowledge goes, the figures of those in camps, and he can account roughly for 1,300,000 prisoners in those camps, and these, to quote his own words, are "undoubtedly much less than the actual figures." These are appalling figures. And it must be remembered that these men are not men who have been caught for the most part with arms in their hands opposing their Government. They are not men—and women too—who have been taking any active part in opposing the present régime in Russia. At the most they are passive resisters of that régime, and the great bulk of them are peaceful peasants whose crime is that they were, shall I say out of sympathy, and perhaps a little bit more, with the agrarian régime laid down by their Government. I do not want to elaborate their piteous tale of suffering to-day. I am sure that there is not one of your Lordships who would not be thankful to see these men and women released. But I would call your Lordships' attention to another and very dangerous and rather gruesome fact, and that is that gradually the economy of Russia is being built up on forced labour. How grateful was the world when Alexander I released the serfs, who, after all, lived peacefully in their own villages. How far back have we gone since that time? Are we going to recognise a state of affairs in the world in which many millions of people are habitually undergoing forced labour as part of the national economy, divorced from their

9
homes, in some cases thousands of miles from their homes?
I have dealt with the point as to whether or not it is open to us to make these representations. The next question is: Will it help the prisoners if we do make these representations? I know many people honestly say it will do them no good. If you have any doubts on this point, my Lords, you will perhaps allow me to read half-a-dozen lines from the same article by Professor Chernavin, who was a prisoner in the Solovetsk Camp. One page is headed "A New Policy":
"The second period began about May,1930. By an Order of Ogpu from Moscow the policy in the concentration camp was radically changed … The campaign—
I am omitting much of it—
"The campaign which broke out against forced labour in the timber trade, which was the principal work of the camp, deprived Ogpu of its chief advantage, currency … but the interest shown abroad in the camps was too strong and too continuous, and the policy of extermination of prisoners was impossible."
Later on, he says:
"Since the spring of 1930 prisoners are no longer beaten, or tortured, or killed for not carrying out their allotted tasks."
Let us be thankful that the Russian Government is apparently susceptible to public opinion as expressed in this country. My Lords, put yourselves in the position of one of these prisoners. Would you think that you would have anything to lose if such representations were made in the friendliest possible fashion by His Majesty's Government? I beg to move.
Moved to resolve, That this House, taking cognizance of the Trade Agreement recently negotiated between His Majesty's Governmenat and the Union of Soviet Socialist Republics, desires to press upon His Majesty's Government that this opportunity should be taken to make representations to the Russian Government for a wide amnesty of political prisoners and the return to their homes of those in forced labour camps.—(Lord Phillimore.)
LORD MOUNT TEMPLE LORD MOUNT TEMPLE had the following Notice on the Paper:—To move to resolve, That in the opinion of this House no commercial agreement, temporary or otherwise, should be concluded between His Majesty's Government in the United Kingdom and the Government of the Union of Soviet
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Socialist Republics, till that Union has taken some steps to liquidate its debts to the British Government and British nationals.
The noble Lord said: My Lords, I am sure we were all very much touched by the moving appeal of Lord Phillimore that His Majesty's Government should do something to lighten the lot of the political prisoners in Russia, and I hope and trust that the noble Earl, Lord Stanhope, when he replies, will be able to say that the Government will consider whether something can be done; but I must ask your Lordships to go back to the far more prosaic hut equally important facts which are embodied in this Agreement. May I first of all, before dealing with the Agreement generally, say a few words on the aspect of the Agreement with which my Motion deals, and with your Lordships' permission I shall read the Motion:
"That in the opinion of this House no commercial agreement, temporary or otherwise, should be concluded between His Majesty's Government in the United Kingdom and the Government of the Union of Soviet Socialist Republics, till that Union has taken some steps to liquidate its debts to the British Government and British nationals."
It seems to me that this question divides itself into two parts: First, what, if any, are the obligations of the Government of this country to look after the interests of our nationals? Secondly, even if they think they can do nothing or ought to do nothing, is it better policy to go ahead for better trade between this country and Russia or to concentrate first of all on trying to get some of the money owing to this country and to British citizens repaid by the Government of the Socialist Republics of Russia?
As to the first point, it seems to me quite obvious that no Government can possibly stand up and say: "We consider we have no duty imposed upon us to try to compel a foreign country to pay its debts to the taxpayers of this country. We will take no responsibility when the property of our nationals is stolen, and we will practically do nothing at all." Yet that is exactly what all Governments in this country have done since the Great War. None of them have ever had any backbone. None of them have really said to the debtors of this country: "Unless you do this we shall be obliged to retaliate upon you." The only exception

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to that was the present Government's action with reference to the engineers who were imprisoned in Russia. There, swift action was taken, and in the end that resulted in the release of the prisoners; but the Government seem now to have sunk back into the laissez faire policy, and all they have done is to write a rather pompous Note to the Russian Government, which was delivered in the spring of last year, saying, in effect: "Remember, we are now going to make a Temporary Agreement with you in which no question of debts arises, yet if and when we ever make a permanent Agreement then you must consider whether you cannot pay us something." Is it likely after that communication to the Soviet Ministers and Ambassadors and Delegates before the negotiations took place—is it likely that the Russian Government are going to pay the slightest attention to any efforts of ours to make them pay their just debts to the taxpayers and private individuals in this country?
The Government having failed to do anything—and they seem rather pleased about it—we are now driven back to consider, and I ask your Lordships' attention for a moment to this, whether it is better policy from the point of view of pounds, shillings and pence for this country to make a Trade Agreement with Russia or to say to Russia: "We will make no Trade Agreement with you until at any rate you have done something, you have paid some small sum, you have made a beginning at liquidating the debts you owe to this country." I submit that the Government are wrong. From the purely commercial point of view—I am not talking about ethics—it would be far better if we concentrated on getting something done in the way of these debts rather than giving them the go-by. What are the sums involved? They are enormous. The Soviet Government at the present moment owe this country over £1,000,000,000 in respect of moneys which the British Government lent to the Russian Government under the Tsarist régime. The Soviet Government said: "We are not responsible for these debts because there has bean a change of régime, and therefore we cannot take on the liabilities of the Tsarist Government." Did your Lordships ever hear a thinner or more absurd argument? We might just as well, se I mentioned a
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year ago in this House, turn ourselves into a Republic and, because we have changed from a Monarchy to a Republic, repudiate all our public debts. It is absurd. Of course, they are liable.
May I remind your Lordships that Viscount Snowden, when Chancellor of the Exchequer, in another place in 1930 said, in answer to a question, that the taxpayers of this country are now paying £45,000,000 per annum because we have to shoulder the responsibility of £1,000,000,000 of debts which should be shouldered by the Russian Government. I would also remind your Lordships that £45,000,000 per annum roughly represents 1s. of Income Tax. We are, therefore, at present paying is. of Income Tax more than we ought to pay because no successful effort has been made to get some of this money from the Russian Government. As to Governmental debts, you may say: "Other countries have repudiated; we ourselves are not free from blame as regards repudiation: and therefore there is something to be said for the Russian Government." I do not say something could not be said for them, but, at any rate, you can understand it is not a clear-cut issue. But the private debts owed to individuals in this country are on a very different footing. There are at the present moment registered at the Board of Trade, no fewer than 5,000 claims of British subjects who had all their property in Russia stolen when the Soviet Government took office. There is no other word for it than "stolen"; they simply appropriated anything that belonged to a British subject, whether it was a company or an individual, in that country.
There is there a clear-cut issue. It may well be that the estimate of £300,000,000, the amount of the claims made by those companies and gentlemen, is an inflated one. I do not know, though it could be ascertained by a duly-appointed Commission of Russian and British delegates. Those hundreds of millions of pounds worth of property was stolen from our nationals and from our companies by the Soviet Government. That is known to everybody; it is not disputed. Surely the Government might, at any rate, have concentrated upon trying to get some redress for these wretched people, many of them reduced to beggary. The Government should have done something for them when they

13
were making this Temporary, which is really a permanent, Agreement, and not given the whole thing the go-by.
Then there is the last item, the Lena Goldfields Concession, small, I admit, in comparison with the other claims, but here there can be no dispute of what the Soviet Government should pay. What is the history? I will give it in half-a-dozen sentences. In 1925 the Russian Government gave a gold mining concession to a company called the Lena Goldfields Concession, which gave that company mining rights over large areas in the Urals for a, great number of years, and included in the provisions of the grant was a statement that any matters in dispute between the two parties should be settled by a neutral tribunal. The nature of that tribunal was indicated. Everything was laid down that could possibly be laid down. Between 1925 and 1930 that company sank £4,000,000 in developing the properties. Directly it became likely that a dividend would be paid the usual thing happened. The Russian Government stepped in and stole the whole thing, imprisoned the Russian employees, and turned out those of foreign birth. The company took the matter to arbitration, as agreed upon by the Russian Government, and the Russian Government refused to appear. An eminent Englishman, an ex-member of the House of Commons, was on that tribunal, and after an exhaustive hearing it awarded £13,000,000 damages to the company. What did the Soviet Government do? It added insult to injury. It offered £1,000,000 to settle all claims when this tribunal, to which the Soviet Government had themselves agreed and which they had outlined in their agreement, had awarded £13,000,000.
Therefore what we have is a liability of round about £1,300,000,000 which the Soviet Government owes to the taxpayers of this country, or to private individuals in this country, and at the present moment—I must stress this fact; I am not saying it on my own authority, I am saying it on the authority of Viscount Snowden as Chancellor of the Exchequer—in addition to being out of that money, we pay £45,000,000 a year, equal to 1s. of Income Tax, because the Government have made no effort to try to get the money which ought to come to the taxpayers in this country. We have that on the debit side, and on the credit side
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we have a nebulous offer of £1,000,000. That is the debit side of what I call the Commercial Treaty question—we are out of that vast sum of money.
What do the Government hope to gain as a set-off against this vast sum? I use the word "hope" because that is about the only thing at present which is not taxed in this country. We are able to indulge in hope, even though the hope may never materialise. The Government hope that in five years' time the balance of trade with Russia will be practically equal. A very good thing if that can be done; but will it happen? The President of the Board of Trade last Thursday in another place said, that in the five years—I beg your Lordships' attention to these figures, because they are important—ending 1932 the imports from Russia into this country were of the value of £124,000,000 and that our exports to Russia were of the value of £50,000,000. Therefore, we were £74,000,000 to the bad; on an average during those five years, £15,000,000 a year to the bad. That is to say, our trade to Russia for the five years averaged £15,000,000 less than the amount sold by Russia to us. Suppose that this Agreement does what is claimed for it, and that we have the adverse balance removed in five years' time. Taking exports to Russia as £10,000,000 a year for the five years, multiply that sum by two and a half, then our exports to Russia will be £25,000,000 by 1938, and parity is reached—that is to say, in order to attain what the Government want, we have in the next five years to raise our exports to Russia from £10,000,000 to £25,000,000.
I would draw your Lordships' attention to the speeches of Mr. Runciman and Colonel Colville, of the Department for Overseas Trade, last Thursday in the House of Commons, They were not enthusiastic that this was going to happen. Colonel Colville, indeed, said nothing about it. He explained a great number of points in the Agreement but did not express an opinion as to whether it was going to be a success or not. What did the President of the Board of Trade say? Mr. Runciman said:
"The development of Russia is sometimes chequered,"—
that is true—
"but, on the whole, it appears during the last two years to have gone ahead. It is possible, as far as we can tell from such in

15
formation as we have, that there will be a considerable extension in the amount and character of the purchases made by the Soviet Government in this country."
Later on he said:
"If the past is an indication of the future, I trust that we shall see considerable extensions of our sales in Russia without any detriment to the importing interests of this country."
In view of what the President of the Board said, I think I may say that if we take the exports of goods from this country as increasing two and a-half times in the next five years, the most enthusiastic advocate of the Trading Agreement can only claim that in five years' time the adverse trade balance will be wiped out by increased exports to Russia.
I turn to another source of information to see whether that is likely to eventuate or not—the Soviet Press. I do not know whether your Lordships have read this, but I think it came from the Riga correspondent of The Times and other sources. He said that the Soviet Press was recently congratulating itself that the decreased imports in 1933, to which Lord Phillimore referred in his speech, proved that there was no longer urgent need for imports, nor was the Soviet Union so dependent on foreign markets as previously. But admit for the sake of argument that exports to Russia will increase two and a-half times; that is only £15,000,000 more than at present. If we get £15,000,000 more export trade, which is the utmost that we can possibly get on the figures officially given, how much of that will be profit? I do not know, but I assume that I shall not be far off if I say that one-third of the amount of money received for the goods sold will be profit. If you take one-third of £15,000,000, what is the possible gain from this Agreement in net profit to this country? Only £5,000,000. I should like the noble Lord who answers for the Government to deal with that, because after all that is the material point. This is a Commercial Agreement, and if it is not going to bring much profit to the people of this country, is it worth having at all?
I shall not keep your Lordships very much longer, but I want to deal with one or two items in the White Paper which contains the Agreement. I am profoundly glad—or rather I was very glad until I read the report of the debate in another place—to find that there is no clause in
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this Agreement about propaganda. In every Trade Agreement since the War there has been inserted, at the instance of the Government of this country, a clause in which the Soviet Government declared that it would not carry on any subversive propaganda in this country against the Constitution and against the Monarchy. Of course they have always carried on a great deal of propaganda, and though we knew that they did carry on propaganda, as we had no means of enforcing the Agreement none of our Foreign Secretaries went any further than writing rather rude letters to the Soviet Minister, which did no good and only made us the laughing-stock of the world. To insist upon a clause being inserted in an Agreement and then frankly to acknowledge that you cannot punish a person who does not carry out that clause, is not good policy and makes one look ridiculous.
But I was very much struck—and I should like the noble Earl who answers to give me information upon this point—by what occurred at the very end of the debate in another place last Thursday. In the OFFICIAL REPORT I read the following:
"SIR N. STEWART SANDEMAN: Will the hon. and gallant Member"?
that is the Secretary of the Overseas Trade Department—
"say a word on the question of Russian propaganda?
"LIEUT.-COLONEL COLVILLE: The Agreement, which is a purely Commercial Agreement, does not include propaganda, but we have an undertaking on the subject of propaganda which holds good, and we think that we have sufficient power to see that the undertaking is regarded."
That just happened to come out by chance, and I am rather surprised that more publicity has not been given to the fact that the Government have an undertaking from the Soviets that they will not carry on propaganda and that the Government think that they have power to see that it is carried out. That is most interesting. I most strongly press the noble Earl when he answers to tell us what the undertaking is. The House, I think, is entitled to know what the understanding is, and how, if the undertaking is broken by the other side, we are going to punish them for breaking that undertaking.
Then a sop was thrown to the taxpayers of this country—to those wretched people who have lost their all in Russia. "This is only a Temporary Agreement; when we come to a permanent agreement we will see that your interests are safeguarded and that your money is paid hack to you." I wonder how long this Temporary Agreement will go on? It must obviously go on for five years, because we shall not get to our parity of imports and exports until five years have passed; and if we look at the temporary Trade Agreements in the past, we find that we rather seem to think that a hundred years may well pass before this Agreement is denounced, for this reason. There are two French Treaties, and Commercial Treaties too, one made in 1826 and the other made in 1882. There was provision for three months' notice on either side in both of those Treaties—Treaties of 1826 and 1882; and when were those Treaties denounced? They were denounced only in February of this year. So that we have two Commercial Treaties with our next-door neighbour, one of 1826 and the other of 1882, which were not denounced until one was over a hundred years old and the other was over fifty years old. Therefore it is hardly diplomatically honest to put up the defence that this is only a Temporary Agreement when it cannot be denounced in ordinary circumstances for five years, and when we have the precedents that temporary Treaties containing provisions for three months' notice have lasted for a hundred years and for fifty years.
There is also the clause with reference to diplomatic immunity, which I was glad my noble friend Lord Phillimore also denounced. I am perfectly unrepentant in my opposition to this diplomatic immunity to the Trade Delegation. Of course if you have a Russian Ambassador here he and his staff must have diplomatic immunity, but why in the name of common sense should you give to these delegations, which are trading delegations and nothing else, diplomatic immunity for their chief and for his two chief assistants? It is a well-known fact—it is not and it cannot be denied—that at any rate in the past, until the Treaty was put an end to, substantial sums of money were brought in through diplomatic channels from Russia and other places to carry on propaganda against law and order in this country. In fact the noble Lord, Lord Stonehaven, in 1921,
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when he was Under-Secretary of State for Home Affairs—Irecollect it because I was in the House of Commons at the time—stated that in the opinion of the Home Office, or in the opinion of the Government, there was coming into this country for propaganda no less a sum than £250,000 every year. Those were the official figures. We all know that the amount is now less, not because the Russians have changed their minds, but because they have not got so much money to send abroad for propaganda purposes.
If noble Lords will kindly turn to the bottom of page 4 of the White Paper containing the Trade Agreement, they will see that there is very considerable danger in giving diplomatic immunity to the Trade Delegation, because it will undoubtedly facilitate sending money into this country to carry on propaganda. In paragraph (4) of Article 5 your Lordships will read:
"In view of the fact that the Trade Delegation is acting in respect of trade for and on behalf of the Union of Soviet Socialist Republics, the Government of the latter assume responsibility for all transactions concluded in the United Kingdom by the Trade Representative or either of his two deputies."
That is to say, the Soviet Government will take responsibility for all that the Trade Delegation does. But the paragraph goes on to say this:
"The Government of the Union of Soviet Socialist Republics will not, however, accept any responsibility for the acts of State economic organisations which, under the laws of the Union of Soviet Socialist Republics, are exclusively responsible for their own acts…"
I confess I do not quite know what State economic organisations are, but evidently they are organisations which are going to operate in this country, or they would not have been put into the Agreement. Of course what will happen when money is wanted to be sent into this country for propaganda, is that the money will go in the ordinary trade operations of the Trade Delegation and the actual propaganda will be carried on by the State economic organisation. If the Government of the day then ask: "What about your promise?" the Soviet Government will reply: "Oh, we have no responsibility for State economic organisations. They, under the laws of the Union, are exclusively responsible for their own acts." It seems to me that a little more explanation should be given by the noble

19
Earl who replies as to these economic organisations and how he is going to deal with them if they act in the way I suggest.
Finally, I will invite those of your Lordships who have the White Paper in your hands to turn to page 2 because I think a protest ought to be made against the involved language in the first paragraph. I will read it to your Lordships and I would like to prophesy that not one of you, unless yen have read it carefully several times before, can make head or tail of what it means. There are sixteen lines and seven commas before you come to a full stop. This is how the first sentence of that paragraph reads:
"For the purpose of developing and strengthening trade relations between the United Kingdom of Great Britain and Northern Ireland and the Union of Soviet Socialist Republics, the Contracting Parties agree that, without prejudice to any other provisions of this Agreement according more favourable treatment, all facilities, rights and privileges, which in the United Kingdom and the Union of Soviet Socialist Republics respectively are or may be accorded with respect to trade to the subjects or citizens of any other foreign State or to juridical persons including companies constituted under the laws of such State or to the preperty of such subjects, citizens or juridical persons including companies shall be extended to citizens of the Union of Soviet Socialist Republics or juridical persons including companies constituted under the laws of the Union of Soviet Socialist Republics and to British subjects, British-protected persons or juridical persons including companies constituted under the laws of the United Kingdom respectively and to their property."
Is it not really an insult to this House, and to the House of Commons, that such a sentence should be flung at our heads? Is it really necessary that we should have a very highly-paid and highly-trained and highly-examined Civil Service to turn out such things over the signatures of John Simon and Walter Runciman? I do think it might be made more easy for us to understand these very complicated trade agreements, and that it is not necessary to introduce these long sentences for our mystification and to bother us.
LORD PONSONBY OF SHULBREDE: My Lords, I have listened to the two speeches introducing two Motions that have just been delivered by the noble Lord, Lord Phillimore, and the noble Lord, Lord Mount Temple. As I listened to them I tried to visualise the two
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noble Lords conducting negotiations for a treaty in the Foreign Office with Soviet representatives. I wondered what they would make of it and if they would ever arrive at any sort of conclusion whatsoever. I do not think there is anything more fatal in diplomacy than trying to introduce extraneous subjects when you want to concentrate your attention on a particular matter that is under negotiation. I think the Government have been very wise in avoiding all these side issues and devoting themselves to the conclusion of a Commercial Agreement which was so very badly needed. The only criticism I feel inclined to make—for we on this side of the House welcome this Treaty—is the fact that it has been rather long delayed. If we could investigate behind the scenes the reason of that delay, I think it might be found there that it was caused by the introduction of certain extraneous matter.
The noble Lord, Lord Phillimore, by his appeals and the noble Lord, Lord Mount Temple, by his threats, want to make the Soviet Government do what they wish them to do. I will take first the argument of the noble Lord, Lord Phillimore, with regard to the Motion he has on the Paper. I do not intend to discuss the Treaty itself except on one point which I shall come to later. The Motion of the noble Lord clearly suggests that we should make an appeal to the Soviet Government on this occasion with regard to their prisoners and the so-called "forced labour." The noble Lord made a very moving appeal on the subject and we may all certainly wish that conditions of that sort did not exist. But in the world as it is to-day, if we are going to set ourselves up as an agency for appealing to the various Governments of the world not to treat prisoners with severity and brutality, not to have concentration camps, not to have imprisonment without trial, not to have torture, not to have absolutely unmerited punishment, I am afraid we shall find ourselves very busy. Not only that, but we should be in the very unenviable position of placing ourselves in the world on a pedestal and saying: "What a pity it is you are not all of you more like ourselves." I do not think that attitude of mind is conducive to good relations between nations. I feel convinced, my Lords, that any approach to the Soviet Government at this time with regard to practices that may

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be going on there—I personally do not know about them—would be the greatest possible mistake, and I do not think any good purpose would be served, just when we have come to an amicable arrangement on a matter-of-fact commercial subject, by the introduction of any extraneous matter of this sort.
With regard to the noble Lord, Lord Mount Temple, his Motion, as he recognises, is a little out of date because an Agreement has been concluded.
LORD MOUNT TEMPLE: It has not been ratified.
LORD PONSONBY OF SHULBREDE: No, but it has been concluded and "concluded" is the word in the Motion. The noble Lord wishes that something should have been put in with regard to debts and claims. If the Government had been so ill-advised as to put in, either by way of a clause in the Agreement or by way of a declaration when affixing their signatures, any declaration that these debts and claims must be settled before the Agreement is made permanent, they would have invited inevitably the reply of the Soviet Government that they also regard their counter claims against us as still binding and that they also should be settled. The result of these two declarations would have been very likely to nullify the goods effects of the Agreement. This question of claims and debts, both private and national, in One with which I had very close acquaintance at one time. It is nearly ten years ago now, and they are still outstanding, but I do not think that the method which the noble Lord, Lord Mount Temple, would adopt in negotiating a treaty would be successful. There are people, and from the opinions voiced in another place in the debate on Thursday I am inclined to think they are not far wrong, who say that private individuals who invest money in foreign countries, or who have property in foreign countries, must take the risk that if a revolution occurs they may lose all.
LORD MOUNT TEMPLE: This is very interesting. Do I understand the noble Lord to stand for the fact that if I engage in trade in France, and the French Government steal my goods, he would do nothing to protect me?
LORD PONSONBY OF SHULBREDE: It depends on what has happened in
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France. lf, as happened in Russia, a Government comes into being with surprising rapidity, which nationalises the whole country and takes over everything in that country as its own property, one is apt to suppose that the repudiation of liabilities will follow. However that may be, I would like to see the noble Lord, Lord Mount Temple, try to conduct these negotiations with the Soviet emissaries, and I think he would make perhaps a worse failure than any of those who have hitherto tried. I claim that the method that I adopted while I was conducting negotiations in 1924, and which was eventually turned down, was not so unwise as was supposed at the time, because I held out an inducement not in the shape of a loan, or even in the shape of a guarantee of a loan, but in the shape of the fact that the Government would go to Parliament to get a guarantee for a loan, if arrangements were made which were satisfactory to the claimants of the debts. I think that was a good arrangement. It was turned down at the time, in the heated animosity against the Soviet Government. But times have changed, and I should not be surprised one of these days, if these negotiations linger on, if my method were to be adopted again.
At any rate I do not blame the present Government for not having reached a satisfactory arrangement with regard to these debts. It is a difficult question, because we are always confronted with the counter-claims of the Soviet Government, and we also have to take into account their reluctance to pay any of the debts which were incurred under the Tzarist régime. I am very glad that this subject has not been mixed up with the Commercial Agreement. Anything more foolish or undiplomatic, or more calculated to endanger the relations, which are improving, between this country and Russia, cannot be imagined, and I am only thankful that Lord Mount Temple is not at the Foreign Office.
With regard to the Agreement itself, I do not take the disappointed view taken by the two noble Lords who have spoken with regard to the prospect of trade in the future. On the contrary, I think the Agreement will give a great fillip to trade between the two countries, and it is obvious that these vast areas are in need of the very articles that we can best

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manufacture here. Transport in Russia is in a deplorable condition. It has not been developed, and rails and locomotives are needed, and can be supplied in this country, not to speak of agricultural implements and all the machinery that we can best manufacture. I think the prospect is good, and I more especially welcome the Treaty because I think that it is gradually putting an end to the animosity which has existed for so long between this country and Soviet Russia. You get just a voice or two like that of Lord Mount Temple, that seems to carry one back ten years, but most other people who have thought this question out have come to the conclusion that, however much we may disapprove of the régime in Russia, they are endeavouring, in a great experiment, to rehabilitate their country, and that therefore it is as well that we should be on friendly terms with them.
You have only to compare the articles which appeared in the leading newspapers in this country in the days when the first Agreement was concluded—I think in 1921 between Mr. Lloyd George and Mr. Krassin—the tremendous outbreak of abuse there was in those days and the demand that no intercourse should be carried on with the Soviet Government at all, with the language used in the last few weeks with regard to this Agreement, and you will note a very great improvement in the tone adopted towards Russia in this country. My Lords, it is not often that I am in a position, on behalf of those with whom I am associated here, of being able to congratulate the Government, but I certainly think they have been wise in concluding this Agreement, and that it will be advantageous to the peace of the world.
There is only one other point, which I thought the noble Earl might be able to say a word about in reply. It is an important point, because it is closely connected with the Agreement and the trade between the two countries. It is the excessive cost of guaranteeing credit on goods exported to the Soviet Government; that is to say, under the export credits scheme. I still do not quite understand, although I read the discussion in another place very carefully, why it is that the present rate of premium for the insurance of these facilities is in this country 6 to 7 per cent., which is more than two or three
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times as much as that charged in other countries on their export credits to Russia. That is one point which I would ask the noble Earl to take into account. Otherwise, I regard this Agreement as a great step forward, and one which I hope will lead to an improvement in trade, and a fall in the unemployment figures in this country.
THE MARQUESS OF READING: My Lords, I desire to detain you for only a few minutes, but I cannot let this opporunity pass of expressing on behalf of those with whom I am associated on this side of the House, some views in regard to both the Resolutions which are now before your Lordships. I will deal first with the speech of Lord Phillimore, leaving aside for a moment his observations with regard to the Agreement, which have not, as it seemed to me, any real bearing upon the purpose of the Motion which he was putting, however relevant they may be to other considerations. We naturally sympathise very much with the observations which he made with regard to political prisoners and the forced labour camps. Anything that can be done in the direction of alleviating the misery of those persons would be welcomed by us, as I am sure it would be by all your Lordships. The difficulty I see is how representations of this character are to be made, and what precedent there would be for us to make representations of the kind desired to the Soviet Government.
I do not think that the case of Austria is quite analogous, indeed I do not think there were representations, in the correct sense of the term, to Austria. But obviously there are opportunities of expressing to representatives of a foreign country views that may be heard here that do not take the form of representations to the Government. If any means could be found of bringing home to the Russian Government that a wide amnesty of political prisoners and those in the forced labour camps should be granted, and that it would make a good impression in this country, and if that could have any effect with the Russian Government, I am sure we should all be very pleased, but I cannot see how this formal Motion could be made in any sense effective. That, however, is a matter with which no doubt the noble Earl who replies for the Government will deal in a more official way than I can do.

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With regard to the Motion of Lord Mount Temple, I confess I have been puzzled, as I listened to him, to understand exactly what it was that he wanted your Lordships to affirm. As the Motion stands, it would mean that we should have no dealings with Russia until it has paid its debts, or rather come to a settlement with regard to the debts, because I do not suppose any human being imagines that it will pay the debts, or anything like the amount, to which the noble Lord referred. What is it that he wants? Are we to stand still and boycott a country for the purpose of enforcing the payment of debts? That is a very ineffective course unless it is made general, and even then I doubt whether it succeeds in getting the payment of debts. And it must be remembered that when the noble Lord says we should not make an agreement until there is a settlement of the debts, that means that we shall suffer, as we have suffered for some time in our trade, through not having the ordinary relations with Russia. What we have to consider in the present condition of things is: Have we anything to gain? How can we get Russia to come to terms with us on these very large debts, mostly Governmental debts? The noble Lord included private debts as well, but the large amounts are Governmental debts. How can he expect that we should be able to arrive at a settlement of that kind if we adopted the course he advocates, and said: "We will make no agreement with you and will keep away from you entirely until you settle these debts"?
I understood the noble Lord to say that we should retaliate. I do not quite know how we could retaliate. We should have been very glad if we could retaliate in such a way as would result in payment of even a small portion of the debts, but we have no means of retaliating. The whole question is whether we are to make an agreement with Russia by means of which we increase the trade of our country, and redress the adverse balance of trade when we get the opportunity, subject to certain conditions, or are to say: "We will have nothing whatever to do with you and we will allow this trade to pass by us and go to other countries."
LORD MOUNT TEMPLE: I should act in the same way as we did—and very
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effectively—in the case of the Metropolitan-Vickers engineers.
THE MARQUESS OF READING: The noble Lord takes me into another field in which I should be very glad to meet him at an appropriate opportunity. But it seems to me there is absolutely not the faintest analogy between that case and this. That was a case of some of our nationals in Russia with regard to whom we took certain action, as we ought to do, for the purpose of insisting that they should get a fair trial according to the procedure of the country, and of bringing all the pressure that we could to bear upon the Soviet Government. But it is a totally different thing when you are talking about the payment of £1,300,000,000 of debts and questions of other claims, like that of the Lena Goldfields Company. How is it proposed to get debts from countries that cannot pay them for the moment? How can you enforce them? To say that because of that you will not trade with them, and will hot enter into better relations with them, which is the effect of trading, seems to me rather an absurd attitude for us to take. The Government have not given up any rights of enforcing a settlement of debts. The Government have not even in the slightest degree failed to adopt the best attitude they could. They have made their declaration and reserved all rights with regard to the debts; and in order to enforce the settlement of the debts they have refused to make more than what is called a temporary or transitional Agreement, because it cannot enter into a permanent Agreement until some settlement of those claims has been made. The noble Lord says, and I think with justice, that, after all, there is nothing very much on the face of the Agreement to show that it is not permanent, judging from the experience of other Treaties. It is true it is made for a certain number of years, but there is in it a clause which enables you to put an end to it at the expiration of six months, if necessary. It is declared to be purely temporary, and for that reason. I agree with the noble Lord in saying that that is not very effective, but at least it is, I think, as much as the Government could do, if they wanted to enter into trade relations and at the same time

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to preserve such rights as they had against Russia.
In regard to the Lena Goldfields Company, of course that is a very real difficulty. There have been attempts at settlement, and I think, as a result of the discussions which have taken place, the offer which has been made to the Lena Goldfields was double that which had originally been made before there was any question of the Agreement. At the present moment, as I understand—I speak only from what I see in the newspapers—there are some further negotiations going on between the Soviet Government and the Lena Goldfields. I cannot see why it should be more difficult for the Lena Goldfields to settle with the Soviet Government because we have come to an Agreement as a result of which we enter into better relations with Russia. I should have thought it would have made it better and easier for them to come to a settlement than it would be if the two countries remained at arm's length.
The whole position is this. During the five years from 1929 to 1932, inclusive, there has been a trade in which Russia has exported to us £124,000,000 worth of goods, and all that we have been able to export during those years is £50,000,000 worth. The noble Lord is quite right; with the invisible exports it amounted to £50,000,000. If that is so we want, if we can, to redress the balance. That is what we are attempting to do, and in the present condition of things throughout the world, where balance of trade is so important, I should have thought it was eminently practical, and that the Government are quite right, in trying to arrive at a solution of this question, to enter into this Agreement. I do not wish to go into the details of the Agreement, but the intention is to proceed to approximate year by year the exports from this country to Russia to the exports from Russia to this country, so that by 1938 what is hoped for and what is provided by the Agreement is that the ratio of trade shall be one as against one and one-tenth—that is to say, that in 1938, if everything goes well, Russia will be sending us one and one-tenth as against one, which is the nearest approximation you can get to equality.
I think for my part that the Government are to be congratulated on arriving
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at a solution of this character. I know that there are provisions in the Agreement which may be difficult, for instance with regard to 7½per cent. in one year being made up in another year; but, whatever the provisions are, there is the object of the Agreement and, given as we may hope and I think expect, that there is good will and good faith on the part of Russia in carrying out this Agreement, I cannot but think it will be an advantage to this country, it will be an advantage to our trade, it will be an advantage to the recovery of trade, and consequently to the economic revival which we are all seeking. It would be lamentable if the Government, for the sake of the questions which have been introduced by the noble Lord, Lord Mount Temple, were to abstain from making an Agreement of this character. I consider it is a right step, and I trust that steps of this character may be continued, because as far as I can see it is the only way of redressing the adverse balance of trade.
EARL PEEL: My Lords, I regret to say that I find myself in the rather unusual position of differing to some extent from both my noble friends on this side of the House who have addressed your Lordships. But I think it rather hard of the noble Lord, Lord Ponsonby, who so vigorously attacked them and said that neither of them, or both combined, were capable of making an agreement with Russia. I do not know the ground for that attack. If my memory serves me—it may be faulty —the noble Lord himself was once dealing with a Treaty with Russia. I think he told us he is rather proud of that Treaty. I am very glad he is proud of it, because I do not remember anyone else who was proud of it, and it had an exceptionally unfortunate effect on the fortunes of his Party; but that is a painful incident which he has long forgotten, and he has now idealised the Treaty after ten years. I want to refer to one other observation made by the noble Lord because it represented a very interesting doctrine. It was the question of the right of a State to repudiate its debts. He gave the instance of France, and said that we may expect repudiation when there has been a very rapid revolution in a country. The right of repudiation seemed to depend on the rapidity with which the revolution

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was effected. I do not know whether that is a correct interpretation, but I think it is exactly what he said. I think that on reflection the noble Lord will probably be more convinced of the "inevitability of gradualness."
The question which has been raised by Lord Mount Temple is an important and serious one—namely, whether or not, considering the position in which Russia has left us as regards debts, we are wise in concluding a Temporary Trade Agreement with that country. I sympathise with a great deal of what the noble Lord said about Russian treatment of these large debts on capital account, but I do not feel quite so confident that until these debts have been recognised we should not make an arrangement on trading account with Russia. I doubt whether our refusal to make an agreement on trading account would have the required effect of making Russia pay up on these debts. If you want to exercise any pressure on that country I should have thought it is much more important to say there shall be no trading with Russia because, of course, trading is going on at the present time, and what this Agreement does is not much more than (shall I say?) to regulate the trade already going on, and to try and introduce some improvement into the arrangements for that trade.
The noble Lord suggests further that we may be in some sense condoning the repudiation of these long-term debts by Russia if we make this arrangement on trading account, but I think their position is safeguarded, because it has been laid down, according to the statement made in another place, that we have directly reserved that right, and we by no means give up any claim that we have on capital account if we make this trading arrangement with the Russian Government. I am not sure it is not rather the other way. Hitherto we have been told: "What is the good of trying to obtain payment of these large sums from Russia? The country is positively bankrupt, ruined—it cannot pay." Now we hear, and I hear, from many political friends of the noble Lord opposite that Russia, far from being unprosperous, is becoming very prosperous. We are told that the five-year plan has been extraordinarily successful, and that they have reached a greater degree of prosperity than was ever attained in that unfortu-
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nate Tsarist régime which has long gone and that the next five-year scheme is going to be even more successful still. I think then, as regards the repayment of debts, that Russia will no longer be able to plead poverty if the statements of their own newspapers and statesmen are true. There were in the past two pleas put forward. First, dishonesty and then poverty. The old plea of poverty has now fallen away, and if this Agreement has the results hoped for by the noble Marquess, and if it really results in a considerable development of trade with Russia, we shall be strengthened rather than weakened in our power of urging that in the interests of international trade some payment or recognition should be made of these Governmental debts.
But I do wish, if I may, very strongly to press this point on the Government. It is not, of course, a light thing that these international debts should be repudiated. What is the cause of the present suffering in international trade? What is the reason why our shipping trade, as we discussed it the other evening, is in such a deplorable condition? It is because of the lack of international trade. And what is at the bottom of that misfortune? It is that, contrary to the time before the War, you cannot now get investors to put their money into foreign loans, because they see these loans are repudiated; and we know that unless you do have these foreign loans you cannot get the same amount of international trade as before, because you cannot develop those countries which are in need of capital and which produce raw materials which they export to manufacturing countries. Therefore it is not merely a question of saying to Russia: "You pay your debts." It is a matter of great importance, lying at the root of a great many of our international trading troubles. There is no doubt that if you could restore the confidence of investors, which has been lost here, in France and in America, if you could restore some confidence, that the interest would be paid and the capital be repaid, it would do more than all your trade treaties to restore something of that international trade on which we in this country are so immensely dependent. I will add that nothing would give more confidence to the investor than if a country like Russia, which has been notorious for repudiation and has led the way in repudiation, were

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to come to an agreement about the recognition or payment of debts. That, therefore, is one of the reasons why I am a supporter of this Trade Agreement. I think it may make the way easier rather than harder to get some recognition of that kind from Russia.
Before I say a word about the Motion of the noble Lord, Lord Phillimore, may I put one or two questions to the noble Earl who is going to reply? There is one question that I think has been asked already, but I wish to put it in a slightly different form. It is with reference to these people for whom only under some circumstances will the Government of Russia take responsibility. They will not take responsibility for the acts of State economic organisations which, under their laws, are exclusively responsible for their own acts. I think, in the interests of traders, it is extremely important to know what those bodies are. Everybody who is in trade studies this Agreement carefully, but it may well be that they will make a mistake, and think that they are dealing with the Russian Trade Representative or his two deputies when really they may be dealing with these State economic organisations for which, under the laws of Russia—which nobody can be expected to understand here—the State has no responsibility and for which the Government of Russia is in no way responsible. I think it would be extremely useful if my noble friend could make that point clear.
I was going to raise another point to which I did not necessarily want an answer, but I will leave that and go on to my next point. I should like an explanation, if I may have one, from my noble friend about what is called the three months' period of notice for the dumping clause. That has been criticised, and it has been suggested, I think with some justice, that that is rather a long period, because, when you have the whole of the trade in the hands of the State, it can make preparations and organise a raid on the trade of another country, getting ships, accumulating goods, and then hurling a tremendous attack on another country in a way that private traders would find it quite impossible to do. I looked at the answer given by the Minister in the other House, and it seemed to me that if it was satisfactory as regards the three months it was unsatisfactory
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as regards the point he was trying to make. He said, in effect, that you must have three months, otherwise the time is so short that people cannot make contracts. I quite agree that three months is not a very long period for the contract to run, but I think it is inevitable that you will have to make some arrangements about contracts running at a time when notice is given.
What is the procedure here? It is this, that when any of this dumping takes place on a serious scale you give notice and begin conversations. If the conversations fail, then, as it were, you withdraw the privileges from that particular article. But it is quite obvious nobody can know how long those negotiations are going on or whether they are going to fail. They may go on for a couple of months, and then notice may be given, but the Agreement says expressly that the notice dates from the time when the conversations begin. Therefore the time may he very short and contracts will be upset. The answer that was given by the President of the Board of Trade as regards shortening that period seems to me to apply just as much to his own scheme as to the other which he criticised.
One other observation I would like to make is about the Agreement itself. It is rather a peculiar kind of Agreement, because it is really a treaty of barter, a sort of equivalent of goods on one side exchanged for goods on the other. I recognise that, as dealing with a country like Russia, where the whole of the trade is under the power and control of one unit, the State, they could switch off their trade to any other country, and use credits in this country to purchase goods. In a way it may be a useful thing to try to establish equality of trade, but it is not a good principle for most of our trade agreements that you should get absolute equality of trade between two countries. It might to some extent injure third-party trade, but I support it as useful in the particular conditions under which it is made with Russia.
May I ask a further question as regards the export credits? I am not really quite sure what the Article exactly means. It says, as regards export credits, that in considering any given transaction regard should be had to financial and commercial considerations. I am not quite sure whether that is an alteration of the existing situation, whether credits

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have been given to Russia in the past on purely financial and commercial considerations. I quite agree with the provision, but in reading it I am not sure whether it is in reduction or increase of the rates that Russia already has, or alters the practice as regards Russia followed by the Export Credits Committee. I think, but I am not quite sure I am right, that in many of these transactions with Russia there was a longer credit granted than was granted to some other countries. I dare say the noble Earl will be able to tell me what exactly that provision does mean.
There are one or two small points of criticism on detail I wish to make. It is rather remarkable to notice the extraordinary reduction in the scope of the most-favoured-nation clause in Russia. We were told at one time that the most-favoured-nation clause was the sheet anchor of our trade. There has been a good deal of contempt or criticism poured upon that clause during the last few years. If you look at the clause you will see that the arrangements made by a great many countries with Soviet Russia diminish the value of that most-favoured-nation clause. Those countries include China and Japan and Esthonia and all the countries that ring Russia around. You have a pretty good list of big countries, running from Czechoslovakia round to Japan. I only mention that to show what a slippery thing that most-favoured-nation clause is.
The other point of detail I should like to submit to my noble friend is this. There is an elaborate method in the Schedule of trying to compute the amount of the trade we do with Russia and Russia with us. I am not quite sure how that operates. At the end of the year is the sum made up, and is the statement presented, as it were, to the Soviet Government to show the extent to which they have fallen short of the amount of trade that should be done with this country? I am not sure from reading the Schedule what happens or what the procedure is under it. The last point I would mention on this Agreement is this. We are very much too fond, I think, in this country of making treaties and forgetting all about them—that is to say, we do not enforce them. I will give an example. At present we have a Treaty with Turkey on the most-favoured-nation clause, but other countries are getting the
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advantage of that most-favoured-nation clause, and we are being shut out. The Board of Trade does not seem to have the power of enforcing our Treaty in Turkey and giving us the advantages of that most-favoured-nation clause. I would urge on the Government to look to the enforcement—it is not an idle piece of advice—as well as to the making of the Treaty itself.
Just one word, if I may, about the Motion of my noble friend Lord Phillimore. The noble Lord, Lord Phillimore, asked me to say a word in support of his proposition. The support I can give is, I am afraid, of a very feeble character, because I am very doubtful about the wisdom of the advice. I sympathise entirely with him in the feelings he has about the treatment of these unfortunate people, but on the whole I support the idea that it is much better for us to look after our own affairs, and our own affairs are so extensive that it is rather unwise to make representations or to give advice to Governments of other countries. I am to some extent reinforced in this view by the experience of the last thirty or forty years. After all, we have to consider whether we are going to do good or not to the unfortunate people on whose behalf these representations are made. We were extremely unsuccessful in Turkey, because when we made any representations about the Armenians there was almost immediately a massacre of Armenians. I know well, having been a good deal in that country, with what eyes these representations were regarded by the unfortunate people for whose benefit they were intended. I doubt also whether unofficial appeals, such as that made I think by the noble and learned Marquess in the Albert Hall, about the treatment of Jews in Germany, have the effect intended.
That is really the question we have to keep in mind. I am against giving vent to one's own generous emotions at the expense of other people, and I would not advise our Government merely to express our feeling of indignation at the cruelties perpetrated in Russia. I agree that there may be cases where that can be done, and my noble friend gave one or two such instances. All I would say is that if the Government themselves think, with all the circumstances before them, that it would be either right or advisable or in the interest of these un-

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fortunate people to make representations, then certainly let those representations be made. But unless the Government feel assured of that, then, as we cannot enforce any of our complaints by sanctions, I think the Government would probably be wise to be very careful in any representations of that kind that they make to the Government of Russia.
THE UNDER-SECRETARY OF STATE FOR FOREIGN AFFAIRS (EARL STAN-HOPE): My Lords, once again I find myself only in part representing the Department in which I am working. As your Lordships are aware the greater part of this Agreement has been the business of the Board of Trade, and although the Foreign Office has of course been consulted at every turn, nevertheless I cannot pretend to have a very great knowledge of the subject from an inside point of view. I think the best thing I can do is to deal briefly with the Motion on the Paper of my noble friend Lord Phillimore, and then to run through the Temporary Agreement dealing with the points which have been raised as I come to each Article.
My noble friend Lord Phillimore moved that the Government should press the Government of the Soviet Republic to give a wide amnesty to political prisoners. As several of your Lordships have already remarked, that of course is quite contrary to normal international usage and contrary to the general practice of this country. My noble friend referred to the personal representation made by our Minister in Austria and suggested that that was an instance which might be copied. Conditions, however, were entirely different with regard to Austria and the Soviet Republic. As regards Austria, there was a case where there had been a sudden outbreak which was dealt with with great severity by the Government of the day—presumably it was necessary—when feeling would of course run high. It was at that moment, when people in Austria were likely to forget that the whole world was looking at them, that it was thought that our Minister should be authorised to make representations. In the case of the Soviet Republic the situation is entirely different. As my noble friend knows very well, it is a condition which has been going on for a number of years in Russia. Therefore neither the Soviet Government nor anybody in the Soviet Republic can be un-
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aware of the feeling held by many people in this country in regard to their form of government and the way in which they treat their citizens. No representations from our Ambassador in such circumstances would be anything but interference which this country would be the last to deem proper.
As regards the Agreement itself, my noble friend Lord Mount Temple found fault straight away with the first paragraph. The Foreign Office is not responsible for drafting this kind of arrangement. I think that is the business of the legal profession, and as my late chief is looking at me with some severity I am not prepared to make any remark on that matter. The phraseology of Article 1 is the common form of the most-favoured-nation-treatment clause. I agree that the sentence read by my noble friend is particularly long, but at any rate he made no pretence that he did not understand it after having read it two or three times.
LORD MOUNT TEMPLE: May I interrupt my noble friend to say that the only way I got to understand it was by getting the education director of our county council to construe it for me?
EARL STANHOPE: I find that is welcomed in another part of the House. As regards Article 2, that is an entirely new Article such as we have never had in any arrangement made previously. The noble Lord, Lord Ponsonby, seemed critical of the length of time which it has taken to get this Agreement approved, but I think he will realise that there are several things in this Agreement which are absolutely contrary to anything the Soviet Government had ever agreed to before. He will recognise that it took a great deal of negotiation before we were able to get them to approve the suggestions we put forward. Here is one of them. It cuts right through the whole of the most-favoured-nation treatment which the Soviet Government had been accustomed to receive before. Your Lordships will remember the last Agreement we had with Russia. It was made in 1930 and it went on until October, 1932. We denounced it in 1932 chiefly for two reasons. The first was that when trading with a State monopoly the State can merely refrain from buying goods from another country, and therefore make the most-favoured-nation clause

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entirely valueless, simply because they turn off the tap of the trade. That leaves the country concerned in the position of being no longer able to sell its goods but with no right to make any representation, no grievance, no possibility of saying that the most-favoured-nation clause has been not fairly operated. Therefore something different had to be done. The result is that we have Article 2.
There was a second reason for Article 2. Noble Lords know that at Ottawa we made arrangements with Canada that where goods were sold at a price that was so low as to compete unfairly with articles sold by Canada, we should make arrangements to limit the sale of those goods. Your Lordships will recognise as regards this second point that all we need really have done would have been to make arrangements by which, if the price of goods coming from Russia was reduced by the action of the Soviet Government, then we should be entitled to stop those goods if they competed unfairly with Canadian goods, and with Canadian goods only. We have gone a great deal further than that in this Article. We have taken power to stop goods coming in where such prices are being created or maintained by either the Soviet Government or its State economic organisations as are likely to frustrate the Preferences not only to Canada but to the whole of the British Empire, and also to stop goods coming in which detrimentally affect the production of such goods in the United Kingdom itself. That is a provision of very real value, and I think your Lordships will agree that the Board of Trade is to be congratulated upon having succeeded in getting it agreed to.
Several noble Lords raised a point with regard to the three months' notice. The reason for that is this. Obviously the Soviet Government would not get any security for their trade if at any moment we said that the trade in a certain article is to be stopped. Lord Peel suggested that the negotiations would very likely be going on for the greater part of the three months. That is very likely true. We put in "three months," to run from the notice given, in order that the conversations should not be unduly prolonged. Otherwise, as he knows, they are likely to be dragged on interminably, and goods will be coming in all the time.
EARL PEEL: They lasted fifteen months the last time.
EARL STANHOPE: In this case they can only last three, and the trader is to take the risk if the Soviet Government fails to come to an agreement. With a very short notice everything tends to get the conversations reduced to the very shortest possible time, and also to encourage the Soviet Government to come to an agreement with us, in order to prevent our taking action which will stop their goods being sold in this country.
EARL PEEL: Will the noble Earl allow me to ask an additional question on that? It is with regard to consuls. Are you going to take steps to increase our consuls in the big towns?
EARL STANHOPE: We have two consuls in Russia, one in Petrograd and one in Moscow. When you get down to the other parts, I think called the "Federated States of Russia," there we cannot have consuls unless we give a right to the U.S.S.R. to have consuls in other parts of the Empire. We think it is not desirable that they should have consuls in other parts of the Empire, or that we should have consuls in the Federated territories, and so at the present moment we have not the right to have a consul in Odessa. With regard to Article 3, that is an important Article, to which many have drawn attention, as to the balance of trade between our-selves and the Soviet Republic. I think that if you will reduce the balance of trade, as it has been in the last five years, to what it is now, your Lordships will see what an improvement the Article is. The figures have been quoted: In the past five years the balance of trade has been twenty-five to Russia and ten to ourselves. Now it comes down to seventeen to Russia and ten to ourselves, and eventually it will be eleven to Russia and ten to ourselves. As the exports from Russia last year were £17,000,000, we have hopes of selling £10,000,000 of goods and services to Russia this year.
I do not want to mislead your Lordships about that. As you will remember, the figures are made up partly by goods sold to Russia and partly by credits for goods sold previously. With regard to 1934, a very large sum is due to this country on credits for goods previously sold, and therefore when you come to

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look at the export figures for 1934, I am not going to suggest that it will amount to £10,000,000 this year. The trade has to balance out. If there is a shortage of goods sold in any one year it has to be made up in the year following, and next year, 1935, some £12,000,000 of goods and services will have to be bought from this country, supposing that the imports from Russia stop at the same figure as in 1933, and unless they are going to pay in cash a very large amount of goods will have to be ordered this year and paid for in 1935 under the export credits scheme.
EARL PEEL:Before leaving that point will the noble Earl say how that is maintained? Is the bill, as it were, made up at the end of each year, and then presented?
EARL STANHOPE: That appears in the end of the Schedule on page 11 of the White Paper, which says that the Soviet Government will give us information with respect to it at the end of each year.
EARL PEEL: We complain if the figure is not enough?
EARL STANHOPE: Yes, and we are then justified in reducing the imports which we take in the following year, if they do not make it up. Article 4 deals with export credits. I think Lord Ponsonby asked why the premium was put so high with regard to the Soviet Government, as compared with the premium charged by other countries. The reason is that some other countries have schemes of their own which guarantee the export of goods to the U.S.S.R. We have no such special fund here to guarantee exports to Russia, and therefore we have to go on the figure which is the commercial risk for that trade. That is assessed by the Advisory Committee, which is not a Government body but merely an advisory one.
Noble Lords complain with regard to Article 5 that diplomatic immunity is given to the Soviet trade representatives in this country. Of course where representatives are commercial attachés, and therefore part of the Embassy or Legation, they invariably receive the ordinary diplomatic immunity, but those are cases very different from this. They are attachés, like military and other attachés, and they are there to report on the conditions of trade in the
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country where they are serving. As regards the Trade Delegation of Russia, of course, they are actually traders and are doing trade, and they are in an entirely different category to any of the representatives attached either to our own Legations or Embassies abroad, or to foreign Embassies or Legations in this country. Of course it is part of the bargain—I make no pretence about it—that we should give diplomatic immunity to the Soviet Trade Representative and his two deputies, and those only as being the men responsible for doing the whole of the trade of Russia in this country.
My noble friend Lord Peel raised the question as to what was meant by the State economic organisations. They are organisations such as Arcos; and what will happen is this, that if anybody chooses to sell goods to Arcos or to some similar organisation they will see to it that the arrangement is approved of by the trade representatives and countersigned by the person specially authorised in the U.S.S.R.
EARL PEEL: Is there a list of these organisations?
EARL STANHOPE: Yes, there will be a list published, I understand, in the Board of Trade Journal. So I understand it will be perfectly clear to anybody doing trade with Russia what these organisations are. I think those people will readily understand that they must get any arrangement they make with these organisations countersigned by one of these representatives in England, and also by the Soviet representative mentioned at the end of Article 5 (4).
EARL PEEL: The countersigner does not have immunity, does he?
EARL STANHOPE: No, he does not. The diplomatic immunity is confined solely to these three people.
LORD MOUNT TEMPLE: The noble Earl said, I understand, that if a trader in this country sells to Arcos he must get the acceptance of a member of the Trade Delegation?
EARL STANHOPE: Yes.
LORD MOUNT TEMPLE: But then, I think that is not quite so. If the noble Lord will read paragraph (4) he will see it states:
"The Government of the Union of Soviet Socialist Republics will not, however,

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accept any responsibility for the acts of State economic organisations which, under laws of the Union of Soviet Socialist. Republics, are exclusively responsible for their own acts, except in cases …."
where responsibility is taken. It is clear from this Agreement that there will be cases in which no backing by the Trade Delegation is carried into effect.
EARL STANHOPE: Of course, if anybody likes to take a risk of that kind he can, but he will not get any backing under this Agreement if he chooses to gamble in that way. All he has got to do, if he chooses to make an arrangement with Arcos or somebody else, is to see that it is approved of by one of the U.S.S.R. representatives, the Trade Representative or one of his deputies, and to see that he countersigns it.
LORD MOUNT TEMPLE: Can he sue Arcos in the English Courts?
EARL STANHOPE: Then it is accepted by the Soviet Government and comes under the ordinary arrangements of the Agreement.
EARL PEEL: Then it is not countersigned by this specially authorised person in that case; it is final?
EARL STANHOPE: I think it has also to be signed by the special representative.
LORD PHILLIMORE: The special representative is hardly the designation, is it, of the counter-signer? The counter-signer may be a person resident in Moscow, I suppose?
EARL STANHOPE: I think so. I am not quite clear about that point.
LORD PHILLIMORE: At any rate he is not included among the three representatives?
EARL STANHOPE: Oh, no, he is not. I think it has to be somebody specially appointed, probably in Russia, to countersign it there. As regards Article 6, I think I told your Lordships some time ago that we hoped as a result of having something to sell in the British market we should be able to get better terms for our trade and also for our shipping. And in addition to what actually appears in this Article, as noble Lords know, a letter was written to the President
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of the Board of Trade promising to use British shipping more extensively than it has been used in the past. In regard to coastal trade, the point raised by Lord Phillimore, I understand that our ships will be treated on an equality with foreign ships. The law of continuous voyage, I think, does not apply in regard to Russia. I believe I am right in saying that a reservation of the coastal trade does not affect the law of continuous voyage and prevent ships picking up goods at various ports and then going on. Of course, the coastal trade in Russia, where it goes definitely from one Russian port to another Russian port only, is normally confined to Russian ships, but there are occasions when there are no Russian ships available, and then we get the advantage of the most-favoured-nation clause for British ships, enabling them to compete with other ships for that trade, and we hope to get it.
With regard to Clause 7, this enables the United Kingdom to give Preferences, and exclusive Preferences, to Empire countries. That is our side of the question—that we are allowed to give our Empire Preferences without interfering with the most-favoured-nation clause. On the other side the U.S.S.R. are allowed to give special rates to the Baltic Succession States and to any country which is in a Customs union with them. My noble friend Lord Peel suggested that there was not very much of the world left, because, by the time we had put in Japan and China and Persia and Afghanistan and so on, we were left with very little of the world's surface with which to trade. But I think if he reads the Agreement a little more carefully he will see that that is not so, because in Article 7 (2) (c) the right of the Soviet Republic there is limited merely to border States; it relates to local trade between the inhabitants of the frontiers only, which is a very severe limitation.
EARL PEEL: I do not understand what a frontier zone is?
EARL STANHOPE: It is not put with extreme definiteness, but the reference is obviously to trade which goes across the frontier.
EARL PEEL: Merely small transit trade?
EARL STANHOPE: Merely small traffic across the frontier. Then Article 8 extends reciprocal most-favoured-nation treatment to the Empire, but the Dominions are excluded from the whole of this Agreement because they are separate Members of the League of Nations and can make their own arrangements; therefore they are excluded from that reciprocal most-favoured-nation treatment in Russia.
Several noble Lords referred to the fact that this Agreement is only a temporary one, and may be terminated at the end of six months, and Lord Mount Temple suggested that there were Temporary Agreements with France, one of which had lasted a century and another for some fifty years. It looks as if those Agreements had been rather satisfactory to have lasted that length of time. If he thinks that this Agreement is going to last as long as that, I think he ought to have congratulated the Government on having made such a very good Agreement.
Then my noble friend Lord Mount Temple raised the whole question of Governmental and private debts. I listened to him with great attention, and I hoped he was going to tell us how those debts were going to be paid, because I was at a great loss to understand how it could be done. After all, he surely does not imagine that these debts—I think he said £1,300,000,000 was due to this country—could be brought in boxes of gold and deposited in the vaults of the Bank of England. It could only be done by further imports from Russia and by using Russian services, Russian ships instead of British ships, buying Russian goods instead of Empire goods or instead of actually manufacturing our own. I hoped that the noble Lord was going to tell us something about that.
LORD MOUNT TEMPLE: May I ask the noble Earl why, if it is so impossible to get your debts paid, the Government have said that in a permanent Agreement they will insist on their being paid?
EARL STANHOPE: On the contrary, we shall insist on their being recognised, and we hope that over a period of years —obviously it will have to be a very long period of years—these debts will get paid. But to say that we can get
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them recognised when Russia is in a position of having to take goods on credit in order to buy goods, seems to me to raise difficulties in regard to the Trade Agreement which really mean we should have to give up any chance of a Trade Agreement at all. I was not quite clear in my mind as to whether the noble Lord wanted a Trade Agreement or not, or whether he thought this was a way of stopping a Trade Agreement being brought into existence. If he wishes to have a Trade Agreement and to sell more to Russia than we have done since the War, then I think, unluckily and unfortunately, we have to postpone the settlement or recognition of the debts due both to private individuals and to the Government in this country by the Soviet Republic.
I forget whether it was Lord Mount Temple or Lord Phillimore who said that the terms of this Agreement had really been dictated by the Soviet Republic. I hope I have shown that to some extent the terms of this Agreement are such that they were not dictated to us. I can assure both my noble friends that the Agreement is different from anything which the Soviet Government have agreed to with any other country. It was by no means easy to arrange, and they took a great deal of persuasion before they would agree to our proposals. As regards the lien on actual articles, such as oil in France, I am informed that we take the view that this Agreement is very much better from the point of view of this country than is the French Agreement. We have always a chance of taking their imports as they come, and whereas we do not think that the security given by the lien in the French Agreement is a very valuable one, we think that our arrangement, which spreads over a period of years, has very much more value than has the French Agreement. In the French Agreement Russia takes £3,000,000 of goods in return for £6,000,000 taken by France, and the Agreement lasts for one year. Your Lordships will recognise from what I have said that we start off with a proportion of seventeen to ten and come down to eleven to ten. That is a very much better agreement from the British point of view than the French have been able to obtain. Then I was asked with regard to the statement made in another place concerning

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propaganda. I understand that is an undertaking which has existed since 1930 and was made to Mr. Henderson. It has never been abrogated and is therefore still in existence.
LORD MOUNT TEMPLE: May we hear what the undertaking is?
EARL STANHOPE: I am afraid I cannot tell my noble friend that. As he knows it is a long way outside the terms of the Motion on the Paper, and I was not aware the matter was going to be raised. I hope I have answered most of the points raised by your Lordships, and I apologise for any I have left unanswered. This is a matter for the Board of Trade rather than the Foreign Office, and as your Lordships know I am a very new recruit to the Foreign Office and do not pretend to know all about that Department. In conclusion may I express the hope that neither of my noble friends will press his Motion?
THE EARL OF ONSLOW: My Lords, may I ask one question to clear up a point which arose in the middle of the noble Earl's speech when Lord Peel asked him a question about consular representation? As I understood him it has not been thought desirable to ask the Russian Government to agree to consular representation outside Petrograd and Moscow because it would be necessary to accord consular representation everywhere to them. Is it not possible to have a consul appointed, say, at Odessa on the understanding that one additional consular representative should be allowed to them here? It is not necessary if you appoint one to appoint others. After all, the exequatur has to go through and be granted by the Government to which the consular representative is accredited, and each case has to be judged on its merits. I am not sure whether I was right in interpreting the noble Earl when he referred to the British Empire. It does not include the Dominions. I think that is expressly stated in the Agreement.
EARL STANHOPE: There is nothing about consular representatives in the Agreement. If the question of consular representation is going to be raised it will be outside this Agreement. It has
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nothing to do with the balance of trade. I am the first to acknowledge that consuls are an immense value to our trade, but there is nothing in this Agreement regarding them. I cannot answer my noble friend further on this matter, but, if he wishes, I will look into it and communicate with him later.
LORD PHILLIMORE: My Lords, I have to thank the noble Earl for the fullness and courtesy of his reply to the many questions which have been showered upon him, but I am very disappointed with the official reception of my Motion. I understand that the noble Earl rests his case on precedent and that he draws a distinction between making representations in the case of long-continued revolution and hat-foot rebellion. It is a distinction which I fail to understand and, I may add, I hope I shall always fail to understand. I would like to remind your Lordships that the only reason why my Motion is, as it were, tacked on to the consideration of this Treaty is in order to take advantage of a favourable opportunity of entering into friendly relations with this country—that is the connection. I was not at all disappointed with the speech of the Leader of the Opposition. I should never have expected that he would have the same measure to apply to a case like this. From his point of view it was far more important that we should sell the rails which these prisoners would have to lay in the Russian swamps than that the prisoners should be benefited. I am not at all surprised that that is his attitude. I have long suspected that the Labour Party were only interested in the suffering of those who supported them.
LORD PONSONBY OF SHULBREDE: I should like to interrupt the noble Lord. In the first place, I think that on this Motion there is no right of reply, and as he is taking advantage of the last few moments to make an attack on the Labour Party I must protest that it is irrelevant.
LORD PHILLIMORE: I do not know why the noble Lord should protest. He spoke in the name of the Labour Party. With regard to the speech of the noble Marquess, Lord Reading, I should like to express my gratitude to him for his very sympathetic remarks and to assure him on

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the point where he did differ from me that I should have been only too pleased to modify my Motion in any terms which would have been more acceptable from the point of view of diplomatic intercourse, and should only be too grateful if the Government could, in any shape or form, represent to the Russian Government that the time had now come when some hand-
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some step of this kind could be taken by them. It would be useless for me to press the Motion to a Division. I will, therefore, withdraw it with many thanks again to the noble Earl for the fullness of his reply.
Motion, by leave, withdrawn.
House adjourned at twenty minutes before seven o'clock.

AIRE AND CALDER NAVIGATION BILL.
Brought from the Commons; read 1a and referred to the Examiners.
BIRMINGHAM UNITED HOSPITAL BILL. [H.L.]
  CHURCH HOUSE (WESTMINSTER) BILL.
  Reports from His Majesty's Attorney-General received and ordered to lie on the Table.
NEWPORT CORPORATION (GENERAL POWERS) BILL. [H.L.]
  LOWESTOFT CORPORATION BILL. [H.L.]
  The CHAIRMAN OF COMMITTEES informed the House that the opposition to the Bills was withdrawn: The Orders made on the 14th of February and Tuesday last discharged, and Bills committed.
WEST GLOUCESTERSHIRE WATER BILL. [H.L.]
The CHAIRMAN OF COMMITTEES informed the House that the opposition to the Bill was withdrawn: The Orders made on the 22nd of February and Tuesday last discharged, and Bill committed.
SHEFFIELD GAS BILL. [H.L.]
Committed: The Committee to be proposed by the Committee of Selection.

WESTON-SUPER-MARE GAS ORDER, 1934.
Special Order proposed to be made on the application of the Weston-super-Mare Gaslight Company:
Laid before the House (pursuant to Act) for affirmative Resolution and referred to the Special Orders Committee.