Sitting of 14 March 1938

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

PRIVATE BUSINESS.
Bombay Baroda and Central India Railway Bill [Lords],
Read a Second time, and committed.

ORAL ANSWERS TO QUESTIONS.
  INDIA.

    COLLIERY COMPANIES.
    Mr. Dayasked the Under-Secretary of State for India the total number of colliery companies in the coalfields of British India that are British-owned; and the total number of managing officials employed in the same who are Europeans?
    The Under-Secretary of State for India (Lord Stanley): I am not in possession of this information.

    GENERAL BUDGET.
    Mr. Sorensenasked the Under-Secretary of State for India whether he will make a statement respecting difficulties that have arisen out of the recent presentation of the Budget to the legislative assembly?
    Lord Stanley: The legislative assembly rejected all the demands for grants presented in connection with the General Budget, and these have all been "restored" in accordance with the provisions of Section 67A (7) of the 9th Schedule to the Government of India Act, 1935. The assembly, further, rejected the motion for consideration of the Finance Bill whereupon the Governor-General "recommended" the Bill in pursuance of Section 67B (1). The assembly refused leave to introduce the "recommended" Bill, which under the provisions of the same Section is to be laid before the Council of State on 17th March. The action of the assembly is understood to be intended as a protest against a change, consequential on the coming into force of the Act of 1935, by which certain small items of expenditure of the Defence Department previously treated as voteable can no longer be so treated. The Governor-General had already, under the powers vested in him by the Act, given directions which provided the assembly with full opportunity of discussion of Defence expenditure proposals; and, as I explained in reply to a supplementary question by the right hon. Member for Gorton (Mr. Benn) on 7th March, it remained open to members of the assembly to signify criticism of Defence policy by moving a reduction of the vote for allowances of the Governor-General's Executive Council.
    Mr. Sorensen: Has the right hon. Gentleman any information regarding the possible modification of the Assembly's attitude?
    Lord Stanley: No, Sir.

    EMPLOYMENT OF CHILDREN (PROTECTION).
    Mr. Woodsasked the Under-Secretary of State for India whether the Government of India received replies from the provincial governments and administrations to its circular letter regarding the protection of children in certain undertakings not covered by the Factories Acts?
    Lord Stanley: I have no information as to what replies the Government of India have received to the two circular letters which they sent out last autumn, but I will make inquiries.

  SPAIN.
  Mr. James Griffithsasked the Prime Minister whether his attention has been called to the declaration made by Senor Negrin, Spanish Prime Minister, on 26th February, to the effect that prior to the insurgent offensive at Teruel numerous shiploads of aeroplanes and artillery arrived in the insurgent zone from German and Italian ports; and whether he can make any statement on the matter?
  The Under-Secretary of State for Foreign Affairs (Mr. Butler): I am aware that Senor Negrin is reported to have made such a statement, but I have received no reports of this nature.
  Mr. Noel-Baker: Have the Government called for reports from British agents in Spain, and is it not the fact that there has been a great deal more intervention by Germany and Italy in the last few months than ever before?
  Mr. Butler: Naturally, reports come to us, but on this particular question, as the hon. Gentleman will see from my reply, I am aware that Senor Negrin is reported to have made such a statement, but I have received no report of this nature.
  Mr. Noel-Baker: Have the Government called for such reports from British agents in Italy and in Spain?
  Mr. Butler: No reports of this nature have been brought before the Non-intervention Committee.
  Mr. Wedgwood Benn: In that case, will the Government asked Lord Perth to inquire whether there is any truth in this statement?
  Sir Archibald Sinclairasked the Prime Minister whether the acceptance by
  4
  the Italian Government of His Majesty's Government's formula for the withdrawal of foreign combatants from Spain included acceptance of the principle that the withdrawal should be in proportion to the numbers engaged on either side; and whether the reimposition of control at the frontiers of Spain was a condition of the Italian Government's acceptance of the formula?
  Mr. Butler: I would remind the right hon. Gentleman that both the conditions which he mentions formed part of the British plan of 14th July and have already been accepted by all the Governments represented on the Non-intervention Committee in their Resolution of 4th November.
  Sir A. Sinclair: Are we in a position to control when the volunteers are withdrawn? My question is, will the immediate reimposition of control be a condition of the acceptance by the Italian Government of the British Government's formula?
  Mr. Butler: The word "immediate" was not in the right hon. Gentleman's question, and I am referring to the question that was put upon the Paper.
  Miss Wilkinson: Can we have a guarantee from the Minister that no control will be reimposed on the legal Government of Spain until the control of General Franco's forces and supplies is made effective?
  Mr. Butler: That is just one of the questions which is being discussed at the present moment.
  Sir A. Sinclairasked the Prime Minister what answers have been received from the Spanish Government and from General Franco, respectively, to His Majesty's Government's representations that the bombardment of open towns ought to be stopped; on how many occasions since those representations were made bombardments of open towns have been carried out by the Spanish Government air forces and by those of General Franco, respectively; and, in view of the recent repeated bombardments of Barcelona by General Franco's air force, what further action he proposes to take?
  Mr. Butler: As the Prime Minister informed the hon. Member for Llanelly (Mr. J. Griffiths) on 28th February, the

  5
  Spanish Government have accepted in principle the good offices of His Majesty's Government, but the Salamanca authorities have replied that, while they deeply regret the bombardment of open towns, and have avoided on every occasion causing useless ravages, and while they take good note of the intiative of His Majesty's Government, they must nevertheless reserve proper freedom of action in so far as the free development of the campaign is concerned, which necessitates striking at military objectives wherever they may be found. I regret that I have not sufficient information to give an answer to the second part of the question. As regards the last part, as the Prime Minister stated on 9th March, His Majesty's Government and the French Government are still in consultation.
  Sir A. Sinclair: Can the hon. Gentleman say whether any further action is to be taken, seeing that his representations have been agreed to by one side and rejected by the other?
  Mr. Butler: We are still in consultation with the French Government on this important matter.
  Miss Wilkinson: In view of the fact that the Government side have accepted the proposal and that General Franco has refused it, is it not only fair that the Government should at least be allowed anti-aircraft guns in order to protect their own positions?
  Major-General Sir Alfred Knox: Is not the Spanish Government's acceptance absolutely due to the fact that they are weaker in the air?
  Mr. Leachasked the Prime Minister whether his attention has been drawn to the announcement of the Spanish Minister of Defence that German submarines are operating on behalf of General Franco; and will he instruct the British representatives on the Non-intervention Committee to bring this matter up for investigation?
  Mr. Butler: I have received no information regarding such an announcement; nor have I any confirmation whatever of the facts alleged. In these circumstances, the second part of the question does not arise.
  Mr. Leach: May I have the honour to supply the information on this matter so as to make up the deficiencies of the hon. Gentleman's own inquiries?
  Mr. Butler: While I do not accept the inference of the latter part of the hon. Gentleman's question, I will certainly consider any definite evidence he may be able to give me.
  Lieut.-Commander Fletcherasked the Prime Minister when he expects to be at liberty to make a statement regarding the withdrawal of foreign troops from Spain in accordance with the British formula which has been accepted by the Powers concerned; on what date the formula was accepted by the Powers, respectively; and whether he can make a statement as to the number of troops to be withdrawn in the first instance and the estimated expense of such a withdrawal?
  Mr. Butler: I regret that it is not possible for me at present to make a statement regarding any of these questions, in view of the fact that there has been no decision by the Non-intervention Committee to publish this information.
  Lieut.-Commander Fletcher: May I ask the hon. Gentleman whether his inability to make any statement arises from the fact that the Powers that have accepted the British formula have no intention whatever of removing any of their troops from Spain? May I have an answer?
  Colonel Wedgwoodasked the Prime Minister whether information as to men and materials sent from Italy to Spain is one of those questions which are communicated to the Secretary of State for Foreign Affairs by our Ambassador in Rome?
  Mr. Butler: It is the function of His Majesty's Representatives abroad to report as far as possible on all matters concerning the countries in which they reside which may be of interest to His Majesty's Government.
  Colonel Wedgwood: Can the hon. Gentleman say whether, during the last year and a half, the Government have had any information at all from our Ambassador as to the despatch of troops or munitions to Spain?
  Mr. Butler: On a question such as this, we have had reports.
  Colonel Wedgwood: Can the hon. Gentleman say whether such a report comes from British consuls at Italian

  7
  ports direct to our Government or whether it goes to our Ambassador at Rome?
  Mr. Butler: His Majesty's Government are well informed through many channels.
  Mr. Benn: In view of the importance of this question, can the Under-Secretary see that Lord Perth inquires definitely in these conversations whether they are true or not? Will he kindly answer that question?
  Mr. Butler: I confine myself to answering the question on the Paper. It is the function of the representatives of His Majesty's Government to send such information as they can, and I am sure that they do so on every occasion.
  Mr. Benn: Does that mean that it is impossible to instruct Lord Perth to make inquiries?
  Mr. Maxton: If the hon. Gentleman says that the Government are well informed on these matters, does he not think that it is now about time the Government were candid in telling the House of Commons some of the information?
  Lieut.-Commander Fletcher: Can the Under-Secretary say whether the information which has been received by the Government from the Ambassador in Rome corresponds with the statements made by the Italian representative on the Non-intervention Committee?
  Mr. Thurtleasked the Prime Minister the nationality of the British Vice-Consul at La Linea?
  Mr. Butler: Yes, Sir. He is a British subject by birth.
  Mr. Thurtleasked the Prime Minister whether it is the intention of the Non-intervention Committee to make the reimposition of the international control of the Portuguese-Spanish frontier part of the new effort to make the non-intervention plan an effective reality?
  Mr. Butler: Observation on the Portuguese-Spanish frontier is exercised not by international, but by British observers in pursuance of an agreement to this end between His Majesty's Government and the Portuguese Government. The British plan of 14th July and also the resolution which was adopted by the Non-Intervention Committee on 4th November last,
  8
  provided for the restoration of observation on both the land frontiers of Spain.
  Mr. W. Robertsasked the First Lord of the Admiralty the total number of survivors that were rescued by British destroyers from the "Baleares"; and whether he is now in a position to state how many of these were not of Spanish nationality and to what nationality they belonged?
  The Parliamentary Secretary to the Admiralty (Mr. Shakespeare): The total number of survivors rescued by British destroyers from the Spanish cruiser "Baleares" was about 370, of whom three died of their wounds while on board. So far as it was possible to discover during the comparatively short time the survivors were on board, they were all Spaniards with the exception of one rating who stated that he was a German.
  Mr. Thurtleasked the First Lord of the Admiralty whether any protest was made to the insurgent authorities in Spain regarding the attack by an insurgent aeroplane on the "Royal Oak"; and, if so, what answer has been received?
  Mr. Shakespeare: The only attack definitely directed at His Majesty's ship "Royal Oak" took place on 2nd February, 1937, when she was at sea in the vicinity of Gibraltar. Three bombs were dropped by Spanish Government aircraft near the ship, but no damage was caused. A protest was made to the Spanish Government authorities and an apology received, the explanation being given that the ship had been mistaken for insurgent warships. The other two occasions to which I referred in my reply to the hon. and gallant Member for Bournemouth (Sir H. Croft) on 9th March, were incidents which occurred during air raids on Valencia on 23rd February, 1937, and on Palma on 2nd March, 1938, on occasions when His Majesty's ship "Royal Oak" happened to be present. In such circumstances no protest was called for or made.
  Brigadier-General Sir Henry Croft: Can the hon. Member say to whom the air raiders belonged which bombed His Majesty's ship "Royal Oak" while lying at Palma?
  Mr. Shakespeare: Presumably to the Spanish Government.
  Mr. Thurtle: Is it not the fact that the aeroplanes which dropped bombs near His Majesty's ship "Royal Oak" were insurgent planes from Valencia?
  Mr. R. Aclandasked the Prime Minister whether the Italian Government attached any conditions to their acceptance of the British formula for the withdrawal of volunteers from Spain and kindred matters; and whether these conditions have been accepted by His Majesty's Government?
  The Prime Minister (Mr. Chamberlain): I would refer the hon. Member to the reply given to the hon. and gallant Member for Nuneaton (Lieut.-Commander Fletcher) on 3rd March, to which I have nothing to add.
  Mr. Acland: Will the Prime Minister give an assurance that it is not a condition, and that we have not agreed, that there should be a closing of the French frontier at any time other than shortly preceding the actual withdrawal?
  The Prime Minister: I would prefer to refer the hon. Member to the answer given on 3rd March.

  AUSTRIA.
  Mr. Arthur Hendersonasked the Prime Minister whether he will now make a statement on the Austrian plebiscite, in view of Article 88 of the treaty of St. Germain and the Geneva protocol of 1922?
  Lieut.-Commander Fletcherasked the Prime Minister whether he has any statement to make on the situation in Austria?
  Mr. Butler: I hope the hon. Members will be good enough to await the statement which the Prime Minister will make during the Debate later in the afternoon.

  CHINA AND JAPAN.
  Mr. Burkeasked the Prime Minister whether he has any statement to make regarding the assault by a Japanese sentry upon a British missionary; whether representations have been made to the Japanese Government; and, if so, with what result?
  Mr. Butler: I understand that a British subject, Mr. Jowett Murray, was struck on the head by a Japanese sentry on 20th
  10
  February at Tsangchow, a town in Hopei on the Tientsin-Pukow Railway, for refusing to bow when passing the city gate. A complaint was at once made to the Japanese Embassy in Peking. I have no report that any reply has yet been received.
  Miss Wilkinson: Have His Majesty's Government now received the requisite apology from the Japanese Government for having hit a British subject on the head?
  Mr. Butler: As I have informed the House, a complaint was at once made, and I am still awaiting a reply.

  NAVAL AND MILITARY PENSIONS AND GRANTS.
  Mr. Sorensenasked the Minister of Pensions whether he will increase the rates of pension to those ex-service men who are unable properly to follow their employment and who are in receipt of a single man's pension, although they have married since the original grant of their pension?
  The Minister of Pensions (Mr. Ramsbotham): Disability pensions are governed solely by the extent of physical disablement arising out of war service. I have no authority to increase the rates in in-individual cases, on the ground of difficulty in following a particular employment.
  Mr. Sorensen: Does the Minister realise that there are very grave hardships arising from the situation involved in this question, and will he sympathetically consider the matter?
  Mr. Ramsbotham: Many great hardships would arise if the principle were altered.
  Mr. Sorensenasked the Minister of Pensions how many pensioners are still receiving medical or hospital treatment at Roehampton and elsewhere; whether he is aware that many of such patients lose their employment in consequence of constant or prolonged interruptions of employment due to this necessary treatment; whether he will see that the charge of 19s. for treatment at Roehampton is reduced; and whether he will charge patients only up to the day of discharge and not for any period subsequent thereto?
  Mr. Ramsbotham: The number of inpatients in Roehampton and other hospitals (apart from mental hospitals) is 2,128. Arrangements have been made, in conjunction with my right hon. Friend the Minister of Labour by which patients in all Ministry hospitals who are unable to return to their former employment may, a week before their discharge, notify the Employment Exchange of their district and so receive prior consideration for fresh employment. The allowances which are payable in addition to free treatment are, under the terms of the Royal Warrant, at fixed weekly rates and are paid weekly in advance. Adjustments between allowances and pension on a daily basis would not be administratively practicable.
  Mr. Sorensen: Is the Minister aware of the custom that obtains of charging 19s.—a rather heavy amount—for treatment, after the patient has left?
  Mr. Ramsbotham: The 19s. represents not a charge for treatment but maintenance allowance in hospital, and is less than half the cost of maintenance. The hon. Member suggests an increased allowance, for which I see no justification.
  Mr. Sorensen: Does the Minister not realise that that leaves the patient very often in a difficult financial position? Will he make an impartial inquiry into the very serious discontent at Roehampton and other places?
  Mr. Ramsbotham: As far as I know, the position is giving general satisfaction.

  TRAVEL ASSOCIATION (GRANT).
  Mr. Dayasked the Secretary to the Overseas Trade Department the amount of the last contribution made by the Government towards the funds of the Travel Association of Great Britain and Ireland for the purpose of carrying out a national publicity campaign all over the world in order to increase the number of visitors to this country?
  The Parliamentary Secretary to the Board of Trade (Captain Euan Wallace): I have been asked to reply. The grant-in-aid for the purpose of assisting the Travel and Industrial Development Association of Great Britain and Ireland in its normal work, which includes publicity overseas to attract visitors to this country, was £5,000 in the current financial year.
  Mr. Day: In the interests of health will this grant be increased?
  Captain Wallace: That raises another question.

  AGRICULTURE.

    FARM LABOUR.
    Mr. Hopkinasked the Minister of Agriculture whether he is aware of the continued shortage of labour for farm work in West Wales and that this drift of labour makes it impossible in some cases to obtain men to do essential work on the farm; that, in consequence, the value of the produce and the capital value is decreasing; and what he intends doing to deal with this problem?
    The Minister of Agriculture (Mr. W. S. Morrison): While it is true that in parts of the country individual farmers have experienced some difficulty in obtaining an adequate supply of farm labour, I am not aware that, speaking generally, it has been found impossible, in West Wales or elsewhere, to carry out essential farm work.
    Mr. Hopkin: Is it not a fact and in every place where there is a factory put down, it is impossible to get in that district any labour for the farms?
    Mr. Morrison: I am well aware that the competition of industrial undertakings accentuates the difficulty of the farm labour situation, but I would remind the hon. Member that the number of dairy cattle in the three counties has increased by six per cent. between 1933 and 1937.
    Mr. De la Bèreasked the Minister of Agriculture (1) what steps the Government are now taking to enable the farmer to secure such a return for his produce as will allow him to pay wage rates in excess of the statutory;
    (2) what steps the Government are now taking to improve the supply of skilled agricultural labourers, in view of the serious effect to the industry caused by the present shortage.
    Mr. Morrison: I would refer my hon. Friend to the reply I gave to him on 28th October last.
    Mr. De la Bère: Is the right hon. Gentleman aware how grave is the problem of the shortage of skilled agricultural

    13
    labour, that it is almost a national calamity and that if it is not tackled courageously it may lead to discontent, disorder and considerable confusion?
    Mr. Morrison: I am aware of the gravity of the problem, and if my hon. Friend will turn to the answer to which I have referred he will see that there is a statutory undertaking to deal with it.

    POULTRY INDUSTRY.
    Sir Gifford Foxasked the Minister of Agriculture, whether he proposes to introduce legislation during the current Session to carry into effect the recommendations of the Poultry Technical Committee; whether he has now ascertained how these recommendations are viewed by the different sections of the community keeping poultry; and whether in any case he will pass legislation to become operative before the hatching season in the late autumn?
    Mr. W. S. Morrison: This matter is receiving the most careful consideration in consultation with the interests concerned, but I have no statement to make at the present time.
    Sir G. Fox: Is the right hon. Gentleman aware that the loss on adult laying birds in England and Wales is £4,000,000 a year, and that the cost of carrying out the recommendation would be only £110,000 a year? Is he aware that if the matter is not tackled quickly it may very well cost a great deal more than that?
    Mr. Morrison: I am aware of the desirability of tackling this problem as soon as possible, but my hon. Friend will agree with me that it is necessary to have consultation with the interests in order that a suitable scheme may be worked out.

    PRICES.
    Mr. De Chairasked the Minister of Agriculture how much it would cost to supplement current prices, including any existing subsidies, received by growers for each of the following agricultural commodities, separately, by sufficient margins to guarantee the following prices: beef 50s. per cwt., mutton 1s. per lb., pigs 14s. 6d. per score, butter 1s. 6d. per lb., eggs 1s. 6d. per dozen, 12 months average, non-malting barley 37s.
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    per quarter, and wheat 50s. per quarter; and whether he will state the current prices on which his calculations are based?
    Mr. W. S. Morrison: As the reply involves a table of figures, I propose, with my hon. Friend's permission to circulate it in the OFFICIAL REPORT.
    Following is the reply:—
    The sum required to make up, in respect of the output in England and Wales of each of the commodities to which my hon. Friend refers, the difference between the prices he has suggested and current prics, or, in the case of eggs the average price for the last twelve months, including any subsidies already in force, may on certain broad assumptions be approximately estimated at the figures given in the table below which includes the prices used for the purpose of the calculations.

    Commodity.

    Sum required to bring up to designated price.

    Current Price including Subsidy Payments for Cattle and Wheat. (c)

    £ million

    Beef

    …

    0.7(a)

    48s. 9d. per live cwt.

    Mutton

    …

    1.8(b)

    10¼d. per lb. dead weight.

    Pigs

    …

    0.9

    14s. 1d. per score dead weight.

    Butter

    …

    0.6

    1s. 4½d. per lb.

    Eggs

    …

    Nil

    1s. 6½d. per dozen. (d)

    Barley

    …

    Nil

    47s. 4d. per quarter of 448 lb. (e)

    Wheat

    …

    1.5

    45s. od. per quarter of 504 lb. (f)

    (a) Based on total estimated live weight of home-produced beef in 1936–37 excluding cattle not certifiable for subsidy payments.

    (b) Based on total dressed carcase weight of home-produced mutton and lamb in 1936–37 excluding ewe mutton.

    (c) Prices used are those ruling during week ended 9th March, 1938, except where elsewhere indicated.

    (d) Average price of 1st and 2nd quality eggs at country markets during twelve months. March, 1937, to February, 1938.

    (e) Gazette average price for week ended 12th March, 1938, for home-grown barley of all kinds. Prices of non-malting barley are not available.

    (f) Standard price for wheat of millable quality.

  BROADCASTING (MEMBER'S CANCELLED ADDRESS).
  Colonel Wedgwoodasked the Postmaster-General whether it was on his instructions, either particular or in general, that the proposed broadcast by the right hon. and gallant Member for Newcastle-under-Lyme on Thursday, 24th February, was cancelled?
  The Postmaster-General (Major Tryon): No, Sir.
  Colonel Wedgwood: I am circulating a copy of the broadcast to Members of the House. May I ask whether in future the democratic Minister responsible cannot be the one to ban or censor Members of this honourable House, instead of leaving it to the officials of an organisation without our responsibilities, and whose sympathies may well be with the dictators and with Rome?
  Major Tryon: That would alter the practice of successive Governments, and would be contrary to the recent decision of the House of Commons.
  Mr. Leach: If the right hon. and gallant Member in his broadcast had introduced a little delicate smut, would he have got it through?

  POST OFFICE.

    AIR-MAILS.
    Sir John Mellorasked the Postmaster General whether his attention has been drawn to the increase in the total cost of postage experienced by certain firms as a result of the Empire air-mail scheme; and whether he will offer alternative facilities at cheaper rates for letters that are not urgent?
    Major Tryon: I would refer my hon. Friend to the reply given on 3rd February to a question by my hon. Friend the Member for Walsall (Mr. Leckie).
    Sir J. Mellor: In view of the fact that there is much correspondence which is not urgent and which is not eligible for second-class mail, could the right hon. Member offer some different facilities for such correspondence?
    Major Tryon: No, Sir. The whole scheme is based on the plan of having all first-class mails sent by air, and in view of the fact that the reduction on
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    mails sent by air is from 6d. to 1½d., and that the mails go faster by air, I do not think that there is any cause of complaint.
    Mr. Anstruther-Grayasked the Postmaster-General on how many occasions mail for East, South, and Central Africa have been offloaded at an intermediate point and carried on by subsequent aeroplane; and what delay has been caused in each case?
    Major Tryon: I am having inquiry made and will write to my hon. Friend.

  ROYAL NAVY.

    MARRIAGE ALLOWANCES.
    Rear-Admiral Sir Murray Sueterasked the First Lord of the Admiralty Whether he is now in a position to make any statement with regard to marriage allowances for naval officers?
    Mr. Shakespeare: I am pleased to be able to inform my hon. and gallant Friend that the award of marriage allowance to officers of the Royal Navy and Royal Marines has been approved. I should be obliged if, for a more detailed announcement, he would await the Debate on the Navy Estimates later this week.
    Lieut.-Commander Agnew: Can the hon. Member give an assurance that the pay of no section of naval officers will be diminished—that there is no diminishment contemplated?
    Mr. Shakespeare: No, Sir; but I think my hon. Friend had better wait for the full details next Thursday.
    Commander Marsden: Will the statement make it clear that marriage allowances will continue even if an officer is on half-pay?
    Captain Peter Macdonaldasked the First Lord of the Admiralty whether he has reached a decision regarding the question of marriage allowance for officers, warrant officers, and other ranks of the Royal Navy?
    Mr. Shakespeare: My hon. and gallant Friend will be aware from the answer which I gave to the right hon. Member for the Hillsborough Division (Mr. Alexander) on Friday last that it has been decided substantially to increase the marriage allowance of Naval ratings.

    17
    With regard to marriage allowance for commissioned and warrant officers, perhaps my hon. and gallant Friend will await the detailed announcement foreshadowed in the answer which I have just given.

  TRADE AND COMMERCE.

    INTERNATIONAL SUGAR AGREEMENT.
    Mr. Marcus Samuelasked the Secretary of State for the Colonies whether he is aware that the recent very heavy fall in the price of sugar in the world markets has caused great loss to the producers in His Majesty's Colonies and is contrary to the expectations held out to them last spring when the international agreement regarding the regulation of production and marketing of sugar was come to; and are any steps being taken to utilise the powers given to the council to adjust the statistical position to the present requirements of the market?
    The Secretary of State for the Colonies (Mr. Ormsby-Gore): I am aware that there has been a fall in the price of sugar as well as of a number of other tropical commodities in recent months. I have no doubt that this, together with all other relevant factors, will receive the careful consideration of the International Sugar Council, but I am unable to predict what, if any, steps the International Council will take in the matter.
    Mr. Samuel: Is it not a fact that the agreement has not been ratified by Holland, or the United States?
    Mr. Ormsby-Gore: I believe that is so.

    FRUIT PRICES.
    Mr. Parkerasked the President of the Board of Trade whether, in view of the fact that a fifth or less of the price paid by consumers in the United Kingdom for fruits grown in the British Empire goes to the growers, he will make arrangements for the Food Council to carry out an inquiry into the costs of the retail and wholesale distribution of fruits as suggested by the Imperial Economic Committee in 1926?
    Captain Wallace: I would draw the attention of the hon. Member to the observations made by the Food Council on the subject of fruit and vegetables in their annual report for 1936. I feel some
    18
    doubt whether the results of such an inquiry as the hon. Member suggests would be likely to justify the labour and expense involved. I will, however, bring the hon. Member's suggestion to the notice of the Food Council.

    IMPORTED FLOUR (MILLING).
    Mr. Maxwellasked the President of the Board of Trade the quantity of flour imported into this country during each of the last three years, and the quantity of flour which has been milled in Great Britain from imported wheat during a similar period?
    Captain Wallace: During the years 1935, 1936 and 1937 the imports of wheat meal and flour into the United Kingdom amounted to 399,000 tons, 418,000 tons and 427,000 tons, respectively. The returns made in connection with the Census of Production, 1935, show that 756,000 tons of home-grown and 4,858,000 tons of imported wheat were used by grain milling firms whose output of wheat meal and flour was 4,043,000 tons. Comparable figures for 1936 and 1937 are not available.
    Mr. Maxwell: Will the right hon. and gallant Member bear in mind the desirability of encouraging flour being milled in this country so as to increase the amount of offal?
    Captain Wallace: I think the advantages of that are recognised.

  TRADING ESTATES (EMPLOYMENT STATISTICS).
  Mr. Shinwellasked the Minister of Labour how many persons are employed in those factories established on the trading estates; and the numbers of men, women and young persons, respectively?
  The Parliamentary Secretary to the Ministry of Labour (Mr. Lennox-Boyd): I will make inquiries and write to the hon. Member.
  Mr. George Griffiths: Can we, as well as the hon. Member, have these figures?
  Mr. Lennox-Boyd: Certainly.

  ARMAMENT FACTORIES (EMPLOYMENT STATISTICS).
  Mr. Shinwellasked the Minister of Labour the estimated number of persons

  19
  employed in armament and munition manufacture in January, 1936, and January, 1938?
  Mr. Lennox-Boyd: Armament and munition manufacture is not separately distinguished in the statistics of employment and unemployment compiled by my Department, and I regret, therefore, that the information desired is not available.
  Mr. Shinwell: Is it not possible for the hon. Member's Department to procure figures of the number of persons employed in armament factories?
  Mr. Lennox-Boyd: It is almost impossible to define with any accuracy what are and what are not armament manufacture, and therefore any such figures would not be of the least value.
  Miss Wilkinson: Could the hon. Member not refer to the Non-intervention Committee the decision what is and what is not armament manufacture?

  UNEMPLOYMENT (STATISTICS).
  Mr. Shinwellasked the Minister of Labour how many persons were unemployed in February, 1937, and in February, 1938, in the building, textile, shipbuilding and engineering industries, respectively?
  Mr. Lennox-Boyd: As the reply includes a table of figures, I will, if I may, circulate it in the OFFICIAL REPORT.
  Following is the reply:

  Table giving the numbers of insured persons, aged 14–64, in the industries in question recorded as unemployed in Great Britain at 22nd February, 1937, and 14th February, 1938.

  —

  22nd February, 1937.

  14th February, 1938.*

  Building industry

  158,854

  170,236

  Textile industries

  112,395

  220,318

  Shipbuilding and ship-repairing.

  38,761

  34,285

  Engineering industries†

  60,312

  77,933

  * The figures for 14th February, 1938, have been complied in accordance with the revised procedure for counting the unemployed, introduced in September, 1937, under which persons subsequently found to be in employment at the date of the count are excluded from the figures.

  † Including general, marine, electrical and constructional engineering, and the construction and repair of motor vehicles, cycles and aircraft.

  EDUCATION.

    DIFFERENTIAL RATING, CARMARTHENSHIRE.
    Mr. J. Griffithsasked the Parliamentary Secretary to the Board of Education whether he is aware that the Carmarthen County Education Committee still persist in levying a differential education rate, and that such a rate bears most heavily upon the depressed areas in the county, involving an additional rate burden of 2s. and over, and also retards the provision of urgently needed new school buildings in several areas; and whether he will make representations to the authority to levy a uniform education rate throughout the county?
    The Parliamentary Secretary to the Board of Education (Mr. Kenneth Lindsay): My Noble Friend is aware that it has been the practice of the Carmarthenshire County Council to charge capital expenditure incurred by them in respect of the provision and improvement of elementary and secondary schools on the parishes served by the schools, and that this practice has retarded educational developments in several areas. He understands, however, that the county council have recently decided to discontinue differential rating for higher education as from 1st April, 1939, and he hopes that they will, in the near future, extend this decision to elementary education also. The council are fully aware of the difficulties which arise under the existing arrangements, as well as of the views of the board, and my Noble Friend does not think that it should be necessary for him to make any representations to them in the matter now.

    SCHOOL TERMS.
    Mr. McEnteeasked the Parliamentary Secretary to the Board of Education the number of local education authorities who have adopted three and four terms, respectively, in the school year; and whether he proposes to take steps to secure uniformity in the practice of authorities in this matter?
    Mr. Lindsay: Of the 315 local education authorities for elementary education, 154 have adopted three terms and 161 four terms. I should add, however, that in 155 of the latter areas three of the terms end at the same time as the terms in the former areas. The fixing of the

    21
    school terms is within the discretion of the authorities, but the board have called attention in Circular 1457 to the desirability of neighbouring authorities having uniform school terms.
    Mr. McEntee: Can the hon. Member from the experience of the Board say whether there is any advantage for one system as against another?
    Mr. Lindsay: I should not like to dogmatise.

  TERRITORIAL ARMY (RECRUITING).
  Sir Charles Cayzerasked the Secretary of State for War whether he will consider with the object of encouraging Territorial recruiting, the compilation of a list of employers who allow members of their staffs who belong to the Territorial Army to attend their annual camps without prejudice to their pay or their normal annual holiday; and whether he will consider the creation of some form of recognition in some way analogous to the King's Roll of the patriotic action they are taking?
  The Financial Secretary to the War Office (Sir Victor Warrender): A proposal to this effect was previously considered and it was found that it might react adversely on the existing" King's Roll Scheme. My right hon. Friend is quite prepared to reopen the matter.

  PUBLIC UTILITIES (WAR TIME FUNCTIONING).
  Sir J. Mellorasked the Secretary of State for the Home Department (1) whether he will indicate the circumstances which prevented inquiries being made until after 8th March, 1938, into the most effective way of assisting water supply and dock and harbour authorities, respectively, to continue functioning in war time;
  (2) whether he will identify the undertakings that he has consulted with regard to the most effective way of assisting electricity, gas, and railway undertakings, respectively, to continue functioning in war time; and how long consultations have been in progress in each case?
  The Under-Secretary of State for the Home Department (Mr. Geoffrey Lloyd): Inquiries into the highly technical problems
  22
  involved were taken up with the appropriate Departments shortly after my right hon. Friend's announcement of 23rd December. As soon as those inquiries had proceeded far enough to make discussion practicable, the representatives of the industries were taken into informal consultation. My hon. Friend will realise that the measures to be adopted will differ according to the type of utility. On electricity, the Electricity Commission have consulted a number of large undertakings in important industrial areas. Consultation with the railways has proceeded through a Technical Committee appointed by the railway management. In the case of gas, consultation has taken place with representatives of three of the largest producers. In the case of water and docks, discussions have been held with the engineers of the Metropolitan Water Board, the Mersey Docks and Harbour Board and the Port of London Authority respectively. As a result of the help afforded to the Department by these conversations, my right hon. Friend intends shortly to consult the representative bodies in each of the public utilities.
  Colonel Nathan: Can the Under-Secretary say when the Government will be able to introduce legislation as promised dealing with public utility companies?
  Mr. Lloyd: Not without notice.

  EX-SERVICE MEN.
  Mr. Ellis Smithasked the Prime Minister whether he has now considered the reports of the British Legion and the Scottish section of the Legion; has he yet received the joint deputation from these two bodies; and is he now in a position to move for the appointment of a select committee?
  The Prime Minister: As the hon. Member will no doubt be aware, I received a joint deputation from the British Legion and the Scottish section of the Legion on 8th March. The representations then made to me will require careful consideration by the Government, and I am not yet in a position to make any statement in regard to them.
  Mr. Smith: Can the Prime Minister inform us when we shall be able to receive further information with regard to this matter in view of the time he has taken to deal with it?
  The Prime Minister: I promised to give careful consideration to the representations and as soon as possible to make a statement.

  CZECHOSLOVAKIA.
  Mr. A. Hendersonasked the Prime Minister whether, in view of Germany's attitude to Czechoslovakia by reason of the alleged persecution of the German minority in the latter country, His Majesty's Government will propose at the forthcoming meeting of the League of Nations Council that the Czechoslovakian Government be invited to explain and justify the treatment of their German minority, in order that the League Council may ascertain whether the Czechoslovakian Government have fulfilled the requirements of the international treaties relating to minorities and accepted by that Government?
  The Prime Minister: It is open to a minority to initiate action before the League under the procedure established by the Council for dealing with complaints arising under the relevant provisions of the Minorities Treaties. In default of such action I am not satisfied that the course proposed by the hon. Member would in present circumstances serve a useful purpose.
  Mr. Henderson: Is the Prime Minister aware that an official representative of the Czechoslovak Government recently declared that his Government would be ready at any time to appear before the League Council to explain and justify their treatment of their German minority?
  The Prime Minister: That does not seem to constitute initiation.
  Mr. Noel-Baker: In view of the reckless and dangerous propaganda on this subject which is going on, would it not be desirable that the facts should be established by the public and impartial methods of the League?

  CIVIL AVIATION (CADMAN COMMITTEE'S REPORT).
  Lieut.-Commander Fletcherasked the Prime Minister whether he will give an assurance that none of the Government decisions arising out of the report of the Cadman Committee will be put into execution until after the House has debated the report?
  The Prime Minister: No, Sir. The Government have accepted a large number of the recommendations in the Cadman Committee's report, and they consider that there should be no delay in carrying out the recommendations affecting organisation to which immediate effect can be given. They have, in fact, already taken appropriate action.
  Lieut.-Commander Fletcher: Is it not unusual for the recommendations of a committee appointed with the approval of the House to be put into execution before the House has had an opportunity of discussing them, especially as in this case only a week's delay would have taken place?
  The Prime Minister: I do not think there was any reason for a week's delay.
  Lieut.-Commander Fletcher: After years of delay.

  SECRETARIES OF STATE (HOUSE OF LORDS).
  Mr. Lipsonasked the Prime Minister whether he will consider introducing legislation to enable a Secretary of State who is a Member of another House to answer questions and speak in Debate in the House of Commons, but not to vote, on matters affecting his Department?
  The Prime Minister: I am afraid I cannot undertake to introduce legislation for this purpose.

  GREAT BRITAIN AND ITALY.
  Mr. Thorneasked the Prime Minister whether he is aware that the name of the person has been published who gave him the telephone message that came from Italy on Sunday, 20th February; and whether he will now give the man's name?
  The Prime Minister: I would refer the hon. Member to the reply which I gave on 28th February to the hon. Member for Kingswinford (Mr. A. Henderson) to which I have nothing to add.
  Mr. Thorne: Will not the Prime Minister now say that it was not Sir Horace Wilson who delivered the message to him on that Sunday in connection with the Italian formula?
  The Prime Minister: I have nothing to add to the reply.
  Mr. Thorne: Will the Prime Minister say definitely that it was not Sir Horace Wilson?

  TOY CINEMATOGRAPH PROJECTORS (INFLAMMABLE FILM).
  Mr. Dayasked the Secretary of State for the Home Department whether his attention has been called to the danger of fires in the homes of people caused through the use of small imported toy cinematograph projectors which can be purchased from 5s. each, and in which are used highly inflammable celluloid films; and will he consider referring this question to the Departmental Committee which is at present inquiring into the use of celluloid for toys in order that they may consider whether legislation should be introduced requiring that all substandard films sold and used in toy projectors should in future be manufactured of non-inflammable or slow-burning material?
  The Secretary of State for the Home Department (Sir Samuel Hoare): Representations have been made to the Home Office from time to time as to the danger from the use of inflammable film in toy cinematograph projectors and I understand that the matter has already been under consideration by the Departmental Committee to which the hon. Member refers.
  Mr. Day: Have the officers of the Home Department made investigations, and if so, what report have they made?
  Sir S. Hoare: Yes, Sir, we have made investigations, and those investigations are at the disposal of the Departmental Committee.

  FOOTBALL POOLS.
  Mr. McEnteeasked the Home Secretary whether he will take any steps that may be necessary to compel companies or persons profiting from the running of football or other pools to contribute a proportion of their profits to the hospitals of the country, as is done by cinema proprietors who open their cinemas on Sundays?
  Sir S. Hoare: The hon. Member's suggestion would involve legislation, and I
  26
  am not in a position to make any statement about legislation on the subject.
  Mr. McEntee: Is the right hon. Gentleman aware that I have received several threatening letters since this question appeared on the Paper, and in view of that, will he double the police force?
  Sir S. Hoare: Whether that is so or not, I am afraid there is no time for legislation.

  CINEMAS (SUNDAY OPENING).
  Mr. McEnteeasked the Home Secretary how many cities or towns have taken a vote on the opening of cinemas on Sundays; and how many have voted in favour of Sunday opening and how many have voted against?
  Sir S. Hoare: The number of cases in which a poll under the Sunday Entertainments Act has resulted in favour of the opening of cinemas on Sunday is 62. I have no information as to the number of polls in which there was a majority opposed to Sunday opening.

  POLITICAL PROCESSIONS, EAST LONDON.
  Mr. Watkinsasked the Home Secretary whether it is proposed to make any further order under Section 3 (3) of the Public Order Act, 1936, prohibiting the holding of political processions in the East End of London?
  Sir S. Hoare: The previous order prohibiting the holding of political processions in certain areas in East London expired at midnight last night. I should have been glad if I could have reached the conclusion that the time had now come when this restriction might be removed; but after reviewing the situation very carefully, in consultation with the Commissioner of Police of the Metropolis, I was satisfied that it was necessary for the preservation of public order to renew for a further period the prohibition of political processions in these areas. I, therefore, gave my consent to a fresh order under Section 3 (3) of the Public Order Act, 1936, renewing this prohibition for a further period of three months from to-day.
  Mr. Wise: May I ask my right hon. Friend whether he will not consider sparing the eyes and ears of the West End the deplorable processions such as the one we saw yesterday?
  Mr. G. Strauss: Will not the traditional May Day demonstrations be able to take place?
  Sir S. Hoare: It will not be possible to have processions of a political character in these districts.

  METROPOLITAN POLICE.

    ACCOMMODATION AND EQUIPMENT.
    Mr. Kellyasked the Home Secretary what housing accommodation and equipment have been provided for the junior station inspectors in the Metropolitan police?
    Sir S. Hoare: Junior station inspectors in the Metropolitan police force are not provided with any special housing accommodation or equipment.
    Mr. Kelly: Are they permitted to live in section houses?
    Sir S. Hoare: All ranks are entitled either to quarters or rent allowance in lieu, and that, of course, applies to junior station inspectors.

    NEW SECTION HOUSE, PUTNEY.
    Mr. Kellyasked the Home Secretary what has been the cost of the construction and furnishing of the new section house for the Metropolitan police at Putney?
    Sir S. Hoare: It is estimated that the cost of the construction and furnishing of the new section house at Putney, including provision for offices, married quarters, and rooms allocated for the use of nonresident officers, will be just under £90,000.
    Mr. Kelly: Has there been an investigation as to the extravagance that has been engaged upon in the construction of this section house?
    Sir S. Hoare: I have no reason to think there has been any extravagance.

    HOLIDAYS WITH PAY.
    Mr. Kellyasked the Home Secretary the number of days' holiday with pay given each year to the members of the Metropolitan Police Force?
    Sir S. Hoare: Members of the Metropolitan Police Force are granted leave with pay according to their rank on the scale laid down for all forces in the police regulations. I will circulate a table in the OFFICIAL REPORT.
    Mr. Kelly: What number of days per year holiday is given to the constables?
    Sir S. Hoare: If the hon. Member will read the table which I propose to circulate in the OFFICIAL REPORT, he will see those details set out.
    Mr. Kelly: Are the constables given a fortnight's holiday in the year, and further, are they given additional holidays, as was suggested in the House last Tuesday, if they are in camps in the Territorial Forces?
    Sir S. Hoare: The hon. Member had better look at the table, and he will see a number of details.
    Following is the table:

    Chief Constables and Superintendents.—Forty-two days with an additional 6 days in each calendar year after completing 10 years' service in the rank, and also one day's leave in each calendar month.

    Days.

    * Chief Inspectors

    21

    * Sub-Divisional Inspectors, First Class, C.I.D. Inspectors, Station and Junior Station Inspectors

    19

    * Uniform Inspectors and Second Class, C.I.D. Inspectors

    18

    * Station Sergeants, Clerk Sergeants and First Class, C.I.D. Sergeants

    16

    * Uniform Sergeants and Second Class, C.I.D. Sergeants

    14

    * Constables

    12

    * In addition, every inspector, sergeant and constable is granted' a day's leave in each week.

  TRANSPORT.

    TAXI-CABS, CENTRAL LONDON.
    Captain Sir William Brassasked the Home Secretary whether his attention has been called to the recent traffic census taken by the Automobile Association in three Central London thoroughfares in which it was shown that at one census point of 1,157 taximeter cabs which passed 984 were disengaged, at another point of 3,172 which passed 2,365 were without passengers, and at a third point, 8 a.m. to 8 p.m. census, of 3,220 which passed 2,710 were disengaged; and, in view of the congestion caused by those crawling taximeter cabs, he will consider

    29
    issuing orders forbidding this practice; between certain hours of the day in certain of the more congested thoroughfares as an experiment?
    The Parliamentary Secretary to the Ministry of Transport (Captain Austin Hudson): I have been asked to reply. I understand that the figures quoted relate to Oxford Street and Piccadilly. Regulations are already in force prohibiting taxi-cabs from loitering in those streets, but the regulations which prohibit loitering do not prevent the right of empty taxi-cabs to pass along the streets.
    Sir W. Brass: Will my hon. and gallant Friend communicate with his right hon. Friend the Home Secretary to see that the police do their duty in this matter?
    Captain Hudson: In 1937, there were 1,015 prosecutions of taximen for various forms of obstruction. I think the police are doing their best.

    GREAT WEST ROAD (CYCLE PATHS).
    Sir W. Brassasked the Minister of Transport the total cost of the cycle paths on the Great West Road; what proportion was borne by his Department and what proportion by the local authority?
    Captain Austin Hudson: The contract price was £11,286, of which three-quarters was chargeable to the Road Fund and the remainder to local rates.
    Sir W. Brass: Is my hon. and gallant Friend aware that in spite of the fact that this large sum has been expended on these bicycle tracks, they are not used; and is he satisfied that they are safe for cyclists to use?
    Captain Hudson: We are proposing to improve the lay-out of the Great West Road, including the provision of cycle (racks nine feet instead of six feet wide.
    Sir W. Brass: Will my hon. and gallant Friend make sure that these cycle tracks go straight across at cross roads, instead of going down on to the main road as they do at present?
    Captain Hudson: Yes, Sir.

    MOTOR VEHICLES (BRAKE EFFICIENCY).
    Sir W. Brassasked the Minister of Transport whether, in view of the inefficiency of the brakes on some of the older
    30
    vehicles circulating on the roads, he will consider a scheme whereby drivers will be expected to carry quarterly, or half-yearly, brake efficiency certificates issued by reputable garages in different parts of the country in order to show that their brakes have been periodically tested and found in good order?
    Captain A. Hudson: No, Sir. Great difficulties would be involved in a scheme of this kind and there is no evidence that it would have any appreciable effect on the number of road accidents.
    Sir W. Brass: Is my hon. and gallant Friend satisfied that the braking efficiency of cars, generally speaking, and especially the older cars, is satisfactory?
    Captain Hudson: Last year, out of 6,300 fatal accidents, only 38 were attributed to failure of brakes.

  OLD AGE PENSIONERS (PUBLIC ASSISTANCE).
  Mr. Tinkerasked the Chancellor of the Exchequer whether he is aware that the cost of supplementing old age pensions by poor law authorities falls more heavily on some than on others; and will he consider taking steps to take the burden of this extra payment from the poor law authorities by payments to them by the Treasury?
  The Financial Secretary to the Treasury (Lieut.-Colonel Colville): The supplementation of old age pensions is only one of many items which make up a total of public assistance expenditure, which varies considerably between authorities. The hon. Member will be aware that considerable weight is given to variations of local needs and resources in the distribution of the large block grants paid by the Exchequer. The Government are not prepared to adopt the proposal in the question.
  Mr. Tinker: If the right hon. and gallant Gentleman is unable to do what I am asking him in this question to do, will he ask his right hon. Friend the Chancellor of the Exchequer to consider meeting the general case of the old age pensioners through the Budget?
  Lieut.-Colonel Colville: I have answered that question previously.
  Mr. Gallacher: Is the Minister not prepared to make a statement of some kind on this subject, in view of the fact that a deputation is on its way to London in connection with this matter?

  SPINSTERS' PENSIONS.
  Mr. Leachasked the Chancellor of the Exchequer whether he is now in a position to say what is to be the composition of the committee to be set up to consider the question of spinsters' pensions and when it is to be appointed?
  Lieut.-Colonel Colville: My right hon. Friend is not yet in a position to make any announcement on this subject.
  Mr. Leach: If I put down a question a week hence, will it be possible to get an answer?
  Lieut.-Colonel Colville: I could not be certain. The work is proceeding, but if the hon. Member desires I can let him know when he might put down a further question.

  GOVERNMENT CONTRACTS (FIRM'S CLAIM).
  Mr. Parkerasked the Financial Secretary to the Treasury whether Messrs. J. C. Davis and Company, of 94–104, Denmark Hill, Camberwell, S.E.5, are contractors to His Majesty's Government; and will he give particulars of all contracts entered into with that firm?
  Lieut.-Colonel Colville: The answer to the first part of the question is that Messrs. J. A. Davis and Company, of 94–104, Denmark Hill, S.E.5, are not contractors to His Majesty's Government. As regards the second part of the question, no contracts have been placed with this firm since the War. The firm claim that they supplied a number of binoculars to Woolwich Arsenal during the War, but owing to the lapse of time it has not been possible to verify this claim. Even if this claim were substantiated, it would not justify the firm in describing themselves as "Government Contractors," and the firm have been so informed.

  SUPREME COURT (UNCLAIMED FUNDS).
  Mr. Thorneasked the Financial Secretary to the Treasury, what amount
  32
  of unclaimed money is in the Supreme Court pay office; how the money is invested; and who claims the interest on the invested money.
  The Solicitor-General (Sir Terence O'Connor): The amount is £2,603,020 which is made up of £1,410,280 in cash and securities of a nominal value of £1,192,740 representing unclaimed investments which existed before the funds became dormant. Part of the above unclaimed cash is covered by the Consolidated Fund and the remainder of the cash is represented by investments in the name of the National Debt Commissioners. Interest arising from unclaimed funds is eventually treated as cash and dealt with by the National Debt Commissioners under Sections 141 and 145 of the Supreme Court of Judicature (Consolidation) Act, 1925.
  Mr. Thorne: Am I to understand from that reply, that the National Debt Commissioners receive the benefit of the interest on this money?
  The Solicitor-General: It is a little difficult to explain the matter by way of question and answer; but if the hon. Gentleman will look at Sections 141 and 145 of the Act he will see that the Commissioners have accepted responsibility for repayment and are entitled to any surplus which accrues from the investment.

BUSINESS OF THE HOUSE.
Mr. Attlee: May I ask the Prime Minister whether he has any statement to make in regard to the business for to-day?
The Prime Minister: At the request of the Leader of the Opposition, foreign affairs will be debated to-day on the Report stage of the Civil Vote on Account, instead of unemployment as previously announced. Conversations have taken place through the usual channels as to the Report stages of the outstanding Supplementary Estimates, with the result that we have agreed to take only those contained in the second Order. Accordingly, Mr. Speaker, with your permission, I would like to amend the Motion which stands upon the Paper in my name by omitting from it the reference to Reports of Supply of 8th and 9th March.
Ordered,
"That this clay, notwithstanding anything in Standing Order No. 14, Supplementary Estimates may be considered on Report before or after Eleven of the clock, and that the Proceedings on the Report of Supply of 1st, March be exempted, at this day's Sitting, from the provisions of the Standing Order (Sittings of the House)."—[The Prime Miniser.]

SELECTION (STANDING COMMITTEES).
  STANDING COMMITTEE A.
  Colonel Gretton reported from the Committee of Selection; That they had discharged the following Member from Standing Committee A: Mr. George Strauss; and had appointed in substitution: Mr. Davidson.

  STANDING COMMITTEE B.
  Colonel Gretton reported from the Committee of Selection; That they had discharged the following Member from Standing Committee B: Mr. De Chair; and had appointed in substitution: Mr. Hepworth.
  Colonel Gretton further reported from the Committee; That they had discharged the following Members from Standing Committee B (added in respect of the Children and Young Persons Act (1933) Amendment Bill): Sir John Mellor and Rear-Admiral Sir Murray Sueter; and had appointed in substitution: Miss Cazalet and Mr. Lindsay.
  Colonel Gretton further reported from the Committee; That they had added the following Fifteen Members to Standing Committee B (in respect of the Bakehouses Bill): Mr. Banfield, Mr. Chapman, Marquess of Clydesdale, Mr. Fleming, Miss Lloyd George, Dr. Haden Guest, Mr. Guy, Mr. James Hall, Mr. Lloyd, Mr. McCorquodale, Mr. McKie, Mr. Marshall, Mr. George Morrison, Mr. Palmer, and Sir Isidore Salmon.

  SCOTTISH STANDING COMMITTEE.
  Colonel Gretton further reported from the Committee; That they had added the following Ten Members to the Standing Committee on Scottish Bills (in respect of the Registration of Still-births (Scotland) Bill): Sir Thomas Cook, Mr. Cooke, Mr. Crowder, Sir Arnold Gridley, Mr. Hannah, Mr. Haslam, Dr. Howitt, Mr. Liddall, Mr. Magnay, and Marquess of Titchfield.
  Reports to lie upon the Table.

MESSAGE FROM THE LORDS.
That they have passed a Bill, intituled, "An Act to consolidate the Trade Marks Act, 1905, the Trade Marks Act, 1919, and the Trade Marks (Amendment) Act, I937." [Trade Marks Bill [Lords.]
DIVORCE AND NULLITY OF MARRIAGE (SCOTLAND) BILL [Lords].
Read the First time; to be read a Second time upon Monday next, and to be printed. [Bill 101.]
ORDERS OF THE DAY.

  SUPPLY.
  [2ND ALLOTTED DAY.]
  Resolution [28 th February] reported.

  SUPPLY.

    CIVIL ESTIMATES AND ESTIMATES FOR REVENUE DEPARTMENTS, 1938 (VOTE ON ACCOUNT).
    "That a sum, not exceeding £184,760,000, be granted to His Majesty, on account, for or towards defraying the charges for the following Civil and Revenue Departments (including Pensions, Education, Insurance, and other Grants, and Exchequer Contributions to Local Revenues) for the year ending on the 31st day of March, 1939, namely:"
    [For details of Vote on Account see OFFICIAL REPORT, 28th February, 1938; cols. 763–66.]
    Resolution read a Second time.
    Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."

  FOREIGN AFFAIRS (AUSTRIA).
  3.37 p.m.
  The Prime Minister (Mr. Chamberlain): The main sequence of events of the last few days will be familiar to hon. Members, but no doubt the House will desire that I should make a statement on the subject. The result of the meeting at Berchtesgaden on 12th February between the German and Austrian Chancellors was stated by the former to be an extension of the framework of the July, 1936, Agreement. Hon. and right hon. Gentlemen will recollect that that Agreement provided, among other things, for the recognition of the independence of Austria by Germany and the recognition by Austria of the fact that she was a German State. Therefore, whatever the results of the Berchtesgaden meeting were, it is clear that the agreement reached was on the basis of the independence of Austria.
  On Wednesday of last week Herr von Schuschnigg decided that the best way to put an end to the uncertainties of the internal situation in his country was to hold a plebiscite under which the people could decide the future of their country. Provision for that plebiscite is made in the Austrian Constitution of 1934. This decision on the part of the Austrian Chancellor was unwelcome to the German Government, as it was also unwelcome to the
  46
  Austrian National Socialists themselves. Matters appear to have come to a head on the morning of 11th March when Herr von Seyss-Inquart, who had been appointed Minister of the Interior as a result of the Berchtesgaden meeting, together with his colleague Dr. Glaise-Horstenau presented an ultimatum to the Chancellor. They demanded the abandonment of the plebiscite and threatened that if this was refused, the Nazis would abstain from voting and could not be restrained from causing serious disturbances during the poll. The two Ministers also demanded changes in the provincial Governments and other bodies. They required, so I am informed, an answer from the Chancellor, before 1 o'clock in the afternoon. The Chancellor declined to accept this ultimatum, but offered a compromise under which a second plebiscite should be held later, with regular voting lists. In the meantime, he said, he would be prepared to make it clear that voters might vote for his policy but against him personally, in order to prove that the plebiscite was not a personal question of his remaining in office. Later that day, feeling himself to be under threat of civil war and a possible military invasion, the Chancellor gave way to the two Ministers and agreed to cancel the plebiscite on condition that the tranquillity of the country was not disturbed by the Nazis. There seems to be little doubt that this offer was referred to Germany. In any event, the reply which the Ministers returned was that this offer was insufficient and that Herr Schuschnigg must resign in order to be replaced by Herr Seyss-Inquart. It appears that the Austrian Chancellor was given until 4.30 p.m., Greenwich time, in which to reply and was informed that if his reply was not satisfactory, German troops would be ordered to move at 5 o'clock. This fact seems to show that Germany was behind the ultimatum.
  Later in the day a fresh ultimatum was delivered, which appears to have been brought from Germany by aeroplane. The demands made were the resignation of the Chancellor and his replacement by the Minister of the Interior, a new Cabinet of which two-thirds were to be National Socialists, the Austrian Legion to be readmitted to the country and given the duty of keeping order in Vienna, and the total readmission of the Nazi party. A reply was required before

  47
  6.30 p.m., Greenwich time. To these demands the Austrian Chancellor announced, a little later on the wireless, that he had, in view of the German threatened invasion, yielded in order to avoid the shedding of German blood. He said that he wished the world to know that the President and he had yielded to force and that Austrian troops had been instructed to oppose no resistance to German troops if and when the latter crossed the frontier. The subsequent entry of German troops into Austria and the visit of the German Chancellor to Linz will be known to hon. Members.
  His Majesty's Government have throughout been in the closest touch with the situation. The Foreign Secretary saw the German Foreign Minister on 10th March and addressed to him a grave warning on the Austrian situation and upon what appeared to be the policy of the German Government in regard to it. In particular Lord Halifax told him that His Majesty's Government attached the greatest importance to all measures being taken to ensure that the plebiscite was carried out without interference or intimidation. Late on 11th March our Ambassador in Berlin registered a protest in strong terms with the German Government against such use of coercion, backed by force, against an independent State in order to create a situation incompatible with its national independence. Such action, Sir Nevile Henderson pointed out, was bound to produce the gravest reactions, of which it would be impossible to foretell the issue. Earlier that day I made earnest representations in the same sense to the German Minister of Foreign Affairs, with whom my Noble Friend also had two further conversations on that day.
  To these protests the German Government replied in a letter addressed to His Majesty's Ambassador in Berlin by Baron von Neurath. I think I should read the terms of that communication in full. They are as follow:
  "Monsieur l'Ambassadeur,
  In your letter of March 11th your Excellency stated that news had reached the British Government that a German ultimatum had been delivered in Vienna demanding the resignation of the Austrian Chancellor, his substitution by the Minister of the Interior, the formation of a new Cabinet with a two-third majority of National Socialist members and
  48
  the readmission of the Austrian Legion. Should this news be correct the British Government protested against such coercion by force against an independent State in order to create a situation incompatible with its national independence.
  In the name of the German Government, I must state in reply that the British Government is not within its right in claiming the role of a protector of the independence of Austria. In the course of the diplomatic conversations regarding the Austrian question the German Government have never left the British Government in doubt that the form of the relations between the Reich and Austria can only be regarded as an internal affair of the German people which is no concern of third Powers. It is superfluous to recapitulate the historical and political bases of this standpoint.
  For this reason the German Government must from the outset reject as inadmissible the protest lodged by the British Government, even though only conditional. At the same time, in view of the information quoted in your letter that the Reich Government had made demands of the character of an ultimatum in Vienna, the German Government does not desire to omit, in the interests of truth, to make the following statement respecting the events of the last few days.
  A few weeks ago the German Chancellor, recognising the dangers resulting from the intolerable position which had risen in Austria, initiated a conversation with the then Austrian Chancellor. The aim was to make yet another attempt to meet these dangers by agreement upon measures which should ensure a calm and peaceful development in consonance with the interests of both countries and with those of the whole German people. The Berchtesgaden agreement, had it been loyally carried out on the Austrian side in the spirit of the conversation of 12th February, would in fact have guaranteed such a development.
  Instead of this, the former Austrian Federal Chancellor, on the evening of 9th March, announced the surprising decision, taken on his own sole authority, to hold within a period of a few days a plebiscite, which having regard to the surrounding circumstances and in particular the detailed plans for the carrying out of the plebiscite, was intended to have, as it could only have, as its purpose the political repression of the overwhelming majority of the population of Austria. This proceeding, standing as it did in flagrant contradiction to the Berchtesgaden agreement, led as might have been foreseen to an extremely critical development of the internal situation in Austria. It was only natural that those members of the Austrian Government who had taken no part in the decision to hold a plebiscite should raise the strongest protest against it. In consequence there ensued a Cabinet crisis in Vienna, which in the course of the 11th of March led to the resignation of the former Federal Chancellor and the formation of a new Government. It is not true that forcible pressure on the course of these developments was exercised by the Reich. In particular the statement subsequently spread by the former Federal Chancellor—to the

  49
  effect that the German Government had delivered an ultimatum with a time-limit to the Federal President, in accordance with which he was to appoint as Federal Chancellor one of certain proposed candidates and construct the Government in conformity with the proposals of the German Government, failing which the entry of German troops into Austria would have to be contemplated—is pure imagination. As a matter of fact the question of the despatch of military and police forces from the Reich was first raised by the (act that the newly formed Austrian Government addressed to the Government of the Reich, in a telegram which has already been published in the Press, an urgent request that, for the re-establishment of peace and order and for the prevention of bloodshed, German troops should be despatched as soon as possible. Faced with the directly threatening danger of a bloody civil war in Austria, the Government of the Reich decided to meet the appeal then addressed to it.
  Such being the case it is completely inconceivable that the conduct of the German Government, as is stated in your letter, could lead to unforeseeable consequences. A general review of the political situation is given in the Proclamation which the Chancellor of the German Reich addressed at noon to-day to the German people. In this situation dangerous consequences could only come into play if an attempt should be made by any third party, in contradiction to the peaceful intentions and legitimate aims of the Reich, to exercise on the development of the situation in Austria an influence inconsistent with the right of the German people to self determination.
  Accept, etc.,
  Freiherr VON NEURATH.
  That concludes the letter by Frieherr von Neurath in reply to the protest of the British Government. I do not wish to enter into any long argument about the historical narrative of events as described by Baron von Neurath, but I am bound at once to refute his statement to the effect that His Majesty's Government were not within their rights in interesting themselves in the independence of Austria, and that, as in the opinion of the German Government relations between Austria and Germany are a purely internal affair, His Majesty's Government, as a third party, have no concern in them. The interests of His Majesty's Government in this question cannot, however, on any tenable ground be denied. In the first place, Great Britain and Austria are both members of the League, and both were signatories, as was also the German Government, of treaties which provided that the independence of Austria was inalienable except with the consent of the Council of the League of Nations.
  Quite apart from this, His Majesty's Government are, and always must be,
  50
  interested in developments in Central Europe, particularly events such as those which have just taken place, if only for the reason, as I stated in the House only a fortnight ago, that the object of all their policy has been to assist in the establishment of a sense of greater security and confidence in Europe, and that that object, as I said then, must inevitably be helped or hindered by events in Central Europe. Throughout these events His Majesty's Government have remained in the closest touch with the French Government, and the French Government have, I understand, also entered a strong protest in Berlin on similar lines to that lodged by His Majesty's Government. It seems to us that the methods adopted throughout these events call for the severest condemnation, and have administered a profound shock to all who are interested in the preservation of European peace. It follows that what has passed cannot fail to have prejudiced the hope of His Majesty's Government of removing misunderstandings between nations and promoting international co-operation.
  It might seem unnecessary to refute rumours that His Majesty's Government had given consent if not encouragement to the idea of the absorption of Austria by Germany, were there not evidence that these are being sedulously being put about in many quarters. There is, of course, no foundation whatever for any of these rumours. The statement which I have already made shows clearly that His Majesty's Government emphatically disapprove, as they have always disapproved, actions such as those of which Austria has been made the scene.
  The attitude of Czechoslovakia to these events is a matter of general interest, and in this connection I can give the House the following information. The Czech Government have officially informed His Majesty's Government that though it is their earnest desire to live on the best possible neighbourly relations with the German Reich, they have followed with the greatest attention the development of events in Austria between the date of the Austro-German Agreement of July, 1936, and the present day. I am informed that Field-Marshal Goering on 11th March gave a general assurance to the Czech Minister in Berlin—an assurance which he expressly renewed later on behalf of Herr Hitler—that it would be the earnest

  51
  endeavour of the German Government to improve German-Czech relations. In particular, on 12th March, Field-Marshal Goering informed the Czech Minister that German troops marching into Austria had received the strictest orders to keep at least 15 kilometres from the Czech frontier. On the same day the Czechoslovak Minister in Berlin was assured by Baron von Neurath that Germany considered herself bound by the German-Czechoslovak Arbitration Convention of October, 1925.
  The House may desire me to repeat what our position in regard to Austria was. We were under no commitment to take action vis-à-vis Austria, but we were pledged to consultation with the French and Italian Governments in the event of action being taken which affected Austrian independence and integrity, for which provision was made by the relevant articles of the Peace Treaties. This pledge arises from agreements reached between the French, Italian, and United Kingdom Governments, first, in February, 1934, then in September of the same year, and finally at the Stresa Conference in April, 1935, in which the position was reaffirmed, to consult together in any measures to be taken in the case of threats to the integrity and independence of Austria. We have fully discharged the pledge of consultation with both the French Government and the Italian Government, to whom we made an immediate approach when Austrian independence seemed to be threatened by recent events. As a result of that consultation with the French Government, His Majesty's Government and the French Government addressed similar protests to the German Government on the action that had been taken. From the Italian Government we received no full exposition of their views, but their attitude has been defined with great precision in the statement issued on behalf of the Italian Government which appears in the Press to-day.
  It is quite untrue to suggest that we have ever given Germany our assent or our encouragement to the effective absorption of Austria into the German Reich. We have, indeed, never refused to recognise the special interest that Germany had in the development of relations between Austria and herself, having regard to the close affinities existing between the two
  52
  countries. But on every occasion on which any representative of His Majesty's Government has had opportunities to discuss these matters with representatives of the German Government, it has always been made plain that His Majesty's Government would strongly disapprove of the application to the solution of these problems of violent methods. It must have, as I have constantly pointed out to the House, a damaging influence upon general confidence in Europe.
  In appraising recent events it is necessary to face facts, however we may judge them, however we may anticipate that they will react upon the international position as it exists to-day. The hard fact is—and of its truth every hon. Member can judge for himself—that nothing could have arrested this action by Germany unless we and others with us had been prepared to use force to prevent it. I imagine that according to the temperament of the individual the events which are in our minds to-day will be the cause of regret, of sorrow, perhaps of indignation. They cannot be regarded by His Majesty's Government with indifference or equanimity. They are bound to have effects which cannot yet be measured. The immediate result must be to intensify the sense of uncertainty and insecurity in Europe. Unfortunately, while the policy of appeasement would lead to a relaxation of the economic pressure under which many countries are suffering to-day, what has just occurred must inevitably retard economic recovery, and, indeed, increased care will be required to ensure that marked deterioration does not set in.
  This is not a moment for hasty decisions or for careless words. We must consider the new situation quickly, but with cool judgment. I am confident that we shall be supported in asking that no one, whatever his preconceived notions may be, will regard himself as excluded from any extension of the national effort which may be called for. As regards our defence programmes, we have always made it clear that they were flexible, and that they would have to be reviewed from time to time in the light of any development in the international situation. It would be idle to pretend that recent events do not constitute a change of the kind that we had in mind. Accordingly we have decided to make a fresh review, and in due course we shall announce what further steps we may think it necessary to take.
  4.4 p.m.
  Mr. Attlee: The Prime Minister has detailed to us the event in this very serious time, and in his closing words he has put before us very grave considerations. This has been for all of us a week-end of great strain, and I fully appreciate the need on this occasion, on every occasion, to speak with the utmost restraint and with a full sense of responsibility. We are face to face with events grave in themselves, which may lead us far to still graver events. We have first of all to see the passing, or what looks like the passing, of a great historic State, Austria. For the last two decades Austria has survived in a truncated condition and during the last decade has been a pawn in the rivalries of great Powers. She has not been a free agent. Her Government has been influenced now by the dictator of Italy, now by the dictator of Germany. She has been pulled now by one and now by the other of these two great Powers, and she has been torn, too, by rival emotions. On the one side the people have a natural affinity with their fellow Germans across the frontier. On the other hand they had the desire to preserve their great cultural heritage.
  To-day we are face to face with the fact that Austria, with its distinctive outlook, has been absorbed, overrun, by the German Reich. I think there was in Austria a very strong feeling in these last years for independence, despite the dictatorship that existed there. I know that the Social Democrats stood for Austria, and I believe that the hearts of all of us will go out to those who may be imperilled there to-day, or captives, the Catholics, the Socialists and the Jews, or any others who may suffer. I trust that our Government will make representations to whatever Government there may be in Austria, that the world will look very closely on what goes on in Austria and will resent any oppression of the people of Austria. I hope that all possible public opinion will be brought to bear.
  Whatever may be one's views—there have been various views expressed from time to time—with regard to whether Austria and Germany should be one State, there can be but one opinion in deploring the manner in which it has been brought about. There has been a display of naked force at a Government which was prepared to consult the people. Had it been
  54
  certain that that consultation was going to favour the union of Germany and Austria, it would have been allowed to proceed in peace. That force has been taken, in my opinion, against the will of the Austrians. This fact of a forcible alteration in the status of Austria causes widespread alarm throughout Europe. It unsettles the minds of all the neighbours of the German Reich. I must recall to the House that this action was taken at the very time when the Government of this country was pursuing friendly conversations with the German Government; what are called the Hitler-Halifax conversations were being followed up at that very time by a visit of the German Minister for Foreign Affairs. Action of this kind is destructive of all intercourse between Governments. It shows the futility of thinking that you can deal with dictator States on the assumptions that usually prevail in the intercourse of States. The other dictator in Central Europe, Signor Mussolini, as far as I can gather, approved this action. Whether he knew and approved it before, I do not know, but he approves it now.
  When we were discussing but a few weeks ago questions of foreign affairs in this House, we were told that there were States in Europe that had different outlooks from our own, and that these different outlooks were followed by different methods. It seems to me that this event knocks down the house of cards which the Prime Minister has been building. The whole House will recall the Debate on the resignation of the late Secretary of State for Foreign Affairs. I recall that in his statement the late Secretary for Foreign Affairs detailed a series of instances in regard to the Spanish contest in which agreements by the dictator of Italy had been followed immediately by a breach, and he said:
  "We cannot risk a further repetition of these experiences."
  He held that it was impossible to make these approaches towards peace which we all desire on a basis of broken pledges. He said:
  "We cannot consider this problem except in relation to the international situation as a whole.… Recent months, recent weeks, recent days have seen the successive violation of international agreements and attempts to secure political decisions by forcible means."—[OFFICIAL REPORT, 21st February, 1938; col. 47 Vol. 332.]

  55
  It was on that point that he resigned and he has been shown to be right. He was, in fact, stating what we have urged on these benches again and again ever since the rape of Manchuria. Each successive instance of bad faith, each breach of a treaty, each successful act of aggression leads to another. The whirlwind which the Government is reaping to-day springs from the wind sown by the present Chancellor of the Exchequer. Manchuria, Rhineland, Abyssinia, Spain, China, Austria—what next? In this progressive deterioration of the world situation there must come a time when it is necessary to stand firm unless all Europe is to be thrown into the melting pot. We are entitled to ask the Government to-day, what is your policy now? The Prime Minister laid down his principles of foreign policy:
  "The maintenance of peace, and, as far as we can influence it, the settlement of differences by peaceful means and not by force."
  We are faced to-day with the use of force again.
  "The promotion of friendly relations with other nations who are willing to reciprocate our friendly feelings and who will keep those rules of international conduct without which there can be neither security nor stability."—[OFFICIAL REPORT, 21st February, 1938; col. 54, Vol. 332.]
  We are face to face again with a disregard of these rules of international conduct. In my view it has shown that you cannot build peace on a false basis. What we need to-day is not an attempt to build peace by separate bargainings with separate dictators, separate attempts to buy off aggression. We need a return to League principles and League policy. I believe that the Government should ask that the League Assembly be summoned, and that our Government should take the lead in proposing means for preventing a further descent into lawlessness. There must be a collective stand made, not only by France and Great Britain, but by the world and the League, and that stand must be made on principle. If nothing is done this incident may be followed by others, and sooner or later you may be forced into a position where a stand has to be made.
  I want the Government to realise the strength of the League. We hear too much talk of its weakness. There is still great strength in the League; there is
  56
  military strength, there is great economic strength, and, above all, there is great moral strength. Bargaining with Italy will, in my view, do very little to buttress the peace of the world. I think that whatever effective strength is gained materially will be offset by the loss in the morale of the world if we assent to the recognition of the conquest of Abyssinia. I believe that it is only on moral principles that you can rally the world to stand against aggression. I am sure it is only by those means that you can rally this country in these dangerous times. I believe it is only on that appeal for the rule of law in the world that you can rally the Dominions to stand in. I believe that is the only way in which you can get feeling on our side—even though it is only a feeling—in the great United States.
  But we are face to face with an issue which demands something more than a standing firm against further aggression. If the League is to stand firm on its principles, it must stand firm for building up a world of law and a world of justice. I do not think that you can settle the difficulties and dangers of the world by bargainings between one big Power and another. You can only do it by trying to establish, within the League, something like justice. Within the League you can deal with these difficulties between States; you can deal with the economic difficulties which are at the back of so much of our troubles; and I say to-day that, faced with this violent action in Austria, our reply should be, "Back to League principles; back to the support of the rule of law" as the only way to maintain peace. To allow a further degeneration of the situation by the admission of the rule of force all the time is to make war inevitable. I believe that the people of this country would stand firm together for the rule of law for the preservation of the peace of the world.
  4.19 p.m.
  Sir Archibald Sinclair: We are in the presence of events which are formidable in themselves and pregnant with still more formidable significance. For my own part, I have never hidden my disagreement with the Government in their foreign policy, but obviously this occasion is not one for a party speech. If ever there was a time for the House of Commons to resolve itself into a Council of State, a

  57
  council in which all men should speak gravely and tolerantly and, as the Leader of the Opposition has said—and done, may I add—with restraint, but also boldly and frankly, surely that time has come now. For my own part, I speak without any hatred in my heart for Germany, or even for the present German Government. I understand only too well why others hate the German Government, and I hate its intolerance, its persecution of the Jews, Protestants and Catholics, its cruel oppression of political opponents, its destruction of freedom and blind worship of force; but I understand why the German people support it; and, let us make no mistake about it, they do support it. I know that they have been goaded into supporting it by the reluctance of other nations to give them equality of rights and status while they were still a democratic country, by the weakness of their economic position and by the unemployment and impoverishment which were caused in their country by the infection of wealthier countries with the virus of economic nationalism.
  In happier circumstances the Anschluss might have represented the fulfilment of German political aspirations for a generation. Nobody who looks clearly at the situation as it exists to-day can take that view now. Austria has been raped by an army of scores of thousands of men, accompanied by 200 bombing aeroplanes. The Prime Minister has told us to-day that the Government have been informed by the appropriate authorities in Berlin that the question of the despatch of those German forces only arose at the request of the new Chancellor of Austria. Nobody who knows the amount of preparation which is necessary to get forces of this size on the march will be able to accept those assurances. Further, I am assured by Austrians with whom I have been in touch, and whose good faith, at least, I have no reason to doubt, that among the Germans who are coming into Austria now are men with all their instructions ready to take over positions, even quite humble positions, in the administration of Austria as soon as they arrive. There is ample evidence of the long and careful preparation which has been made for the German invasion of Austria. Moreover, these moves have been made in spite of, as the Prime Minister has reminded us, the clear pledge which Herr Hitler gave to Dr. Schuschnigg in July of last year
  58
  and again a few weeks ago at Berchtesgaden, that the independence of Austria would be respected, and in spite, also, of the declaration which Herr Hitler made to the world after the invasion of the Rhine-land. He said then that the immediate aims of Germany had been fulfilled and that there would be no more surprises.
  Now terror reigns in Vienna. Already to-day the Austrian Army is being embodied in the German Army, a process the pace of which is, we must realise, in spite of the necessarily vague announcement which the Prime Minister has made to-day, rather quicker than the process of British rearmament. To-morrow all the resources of Austria will be directed to The reinforcement of the German war machine. Who are the sentimentalists and who are the realist politicians? Those who, like some hon. Members opposite, with some Members of the Government, think that our business is merely to get on with our own rearmament, to refuse to undertake commitments in Europe and to watch the armies and the whole resources of small European States being turned over, as I said on Monday, in the balance-sheet of power from one side of the account to the other? No, the realists are those who have declared that national rearmament alone can give no security to the country against war, but that war can only be averted, and the freedom and independence of all nations, including Britain, be secured, if we strengthen the League of Nations and combine our resources in a system of collective security against aggression.
  Germany, having swallowed Austria, shows no sign of repletion. General Goering declares that German armaments, too, are to be increased. It is true that he has given, as the Prime Minister reminded us, an assurance to the Czechoslovakian Government in Prague that German armaments will not be directed against Czechoslovakia, but we must remember in that context the assurances so quickly disregarded which Herr Hitler gave to Austria. Herr Hitler makes it clear, too, that German support will be forthcoming for Italian aims, and he has expressed in glowing terms his gratitude to Signor Mussolini for his forbearance in this crisis. General Goering has declared that 10,000,000 or 12,000,000 Germans living outside the present frontiers of Germany are part of the German people in whose welfare the German Government is

  59
  actively interested. There are only 6,500,000 in Austria. Herr Hitler and General Goering have declared that Germany will not allow Bolshevism in Spain, and only yesterday General Goering repeated those assurances and declared that the fight against Bolshevism—on that occasion he was not only speaking of Spain, perhaps in Hungary, perhaps in Czechoslovakia, perhaps in France, perhaps elsewhere—will be "pursued relentlessly to the full consequences"—those were his words.
  It would be unfair to the Prime Minister to expect him to be able to re-state his policy at a few hours' notice in the light of these events. More particularly would it be unfair to him if, as I hope, the policy which he eventually states to us is a fresh one. He rightly claimed that he should make no hasty decision and speak no careless words, but I feel sure that the House and the country will not be satisfied unless we obtain from him soon a clear and definite statement, and unless action promptly follows. National rearmament is not enough, and it is not true that there is safety in procrostination and delay. Look back. For many years many of us—I said I was making no party speech, and I do not mean only my hon. Friends round me, but also some of those whom I see sitting on the benches opposite—were begging successive Governments to redress the legitimate grievances of the nations which were vanquished in the war. I see in front of me the right hon. Member for Epping (Mr. Churchill). He is often represented as a man of war. I remember him constantly saying, "Let the redress of the grievances of the vanquished precede the disarmament of the victors," but no Government would listen to him. To revise the Treaties, we were told, was an irresponsible suggestion. Tear up the Treaty of Versailles! Why, that would plunge Europe into chaos. So we went on, and no Government would tackle the question which lay at the root of the peace of the world.
  Then Germany re-armed. Again the right hon. Gentleman the Member for Epping comes forward and tells us of Germany's re-armament and gives us facts and figures about it. The Government present quite a different set of figures showing that it is quite unnecessary
  60
  to take any action of the character and on the scale suggested by the right hon. Gentleman. I am not trying to be wise after the event. I supported the Government against the right hon. Gentleman the Member for Epping. If a Government with their innumerable sources of information give official figures I trust them against those of any private Member however distinguished and however good I know his sources of information to be. Again, inaction was not justified. We had the Minister for the Co-ordination of Defence saying that we had gained great advantage from the delay which had passed, and a few months afterwards warning us of the years that the locusts had eaten. During these recent crises in the affairs of the world many of us have begged the Government to make a stand and to stop the retreat of the Democracies against the advance of the Dictatorships, but hon. Members have shouted: "You want war. You must be careful." So, from Abyssinia to Spain, and now in Austria, we see the Democracies still on the retreat before the Dictatorships. The weeks and months are precious; do not let the Government go on allowing the locusts to eat them.
  Abyssinia was, in my view, the turning point. The Government never really determined that the League should triumph over Italian aggression. Time after time the Prime Minister used to say: "If the League fails." I remember saying at the time—again, I am not merely being wise after the event:
  "Let us then abandon idle talk about the possibility of the League's failure and about putting our shoulders to the wheel and building up a new League, for if the forces of aggression and anarchy break through the defences of the League, civilisation will be engulfed."—[OFFICIAL REPORT, 24th February, 1936; col. 90, Vol. 309.]
  Now we see, through the hail of bombs in China and Spain and the rumbling of the tanks through the streets of Vienna, the tide of anarchy and confusion rising and engulfing civilisation in those countries; and the Prime Minister now declares his disbelief not only in collective security but in the possibility of creating it. So we see in many small countries the fear arising that they will be left unprotected to face the aggressor. Of course we must re-arm; my hon. Friends and I have supported every armament Estimate that has been brought before this House; but rearmament is not

  61
  enough. If we cannot rally against aggression all the forces of the potential victims, they will he sacrificed one by one, till it comes to our turn. Other nations may then shrug their shoulders and say: "Our national interests are not directly threatened." And we are left friendless and alone.
  In Abyssinia, Danzig, Spain, China and Austria force, ruthless and brutal, is mercilessly trampling on law, freedom, justice, decency and order. How remote that speech of the Prime Minister sounds—the Prime Minister who prides himself on his realism—in which he said that international tension was relaxed, and that there was an increased feeling of security in Europe. That speech was made only five weeks ago. Then he received the Italian assurances that they had accepted the British Government's formula for withdrawing Italian troops from Spain. So he threw his Foreign Secretary to the wolves. Now Herr Hitler marches into Austria and the Italian armies—[An HON. MEMBER: "Is this non-political?"]—are they remaining inactive? Not at all. They are marching through the Province of Aragon towards Barcelona. And when the Prime Minister sees the Italian armies enslaving the Abyssinians and securing the mastery of Spain, and thereby of Gibraltar and of our trade routes through the Mediterranean and down the west coast of Africa, to what conclusions do his reflections lead him? That Britain must not pursue a vendetta against Italy. The truth is clear; scores—I am told hundreds—of German aeroplanes of, for the first time, the latest type, are pouring into the field in Spain and are actively co-operating with the Italian Army Corps in the attack upon the Spanish Government.
  I respect the opinions of hon. Members opposite—and I see several of them here to-day—who sympathise with the cause of General Franco. I do not agree with them, but I respect their motives for doing so, as I believe they respect mine for sympathising with the Spanish Government; but I say, let us all unite in opposition to this Italian and German conspiracy to dominate Spain. Austria has gone; I believe it is not Czechoslovakia which is the next victim on the list, but Spain. The events of the past week have proved abundantly how right was the view which the right hon. Gentleman the Member for
  62
  Warwick and Leamington (Mr. Eden) put before the House three weeks ago. Seldom, if ever, in the history of Parliament has resignation from a Government been so quickly justified by the event. Either the Prime Minister is being fooled or he is trying to fool the British people.
  What then should we do? We should first insist that intervention in Spain must be stopped or that the non-intervention policy must be abandoned as a farce. Otherwise, make no doubt about it, the whole resources of Spain, her man power, economic wealth, strategic positions, islands and colonies, will pass over to the credit of Germany and Italy and will be used to reinforce the structure of their war machine. Let us also resolve to support France if she, in the pursuit of her undertakings to Czechoslovakia, finds it necessary to uphold the independence of that country. Let us draw more closely by all means in our power to the Government of the United States of America, and let us not forget the warnings of Lord Balfour against the folly of leaving Russia out of account when we are discussing our relationships with European Powers. Let us remember, also, the vital importance of friendship with Poland. Let us consider our economic and financial resources in our relations with Italy and Germany, and, above all, as the Leader of the Opposition pleaded, let us base our policy firmly on the principles of the Covenant of the League of Nations, and rally to the support of the League all those truly peace-loving Powers who desire to see international relationships based not on force and violence or the shifting sands of power politics, but on the moral law.
  4.41 p.m.
  Mr. Boothby: I shall not detain the House for more than a short time this afternoon, but I would like to say, to begin with, one or two words to the right hon. Gentleman the Member for Caithness and Sutherland (Sir A. Sinclair). I agree with the part of his speech in which he dealt with the situation in Spain, which, I think, gives cause for the greatest anxiety. But I do not think that the right hon. Gentleman lived up to the promise which he made in his opening sentences not to deliver a partisan speech; and I think that the aside, which he did not utter very strongly, and which, I think, he half regretted while he was mak-

  63
  ing it, that the Prime Minister was either fooling himself or fooling the country, was not really intended. The least one can say about the Prime Minister is that no Minister has ever made his policy more crystal clear at every stage, or voiced so frankly to the House of Commons what he was trying to do. The right hon. Gentleman declaimed with eloquence about the mistakes that had been made in the past:
  "Not Heaven itself upon the past has power."
  We can all blame ourselves for what has happened, and the least said about it the better. Every Government has been to blame. We have had opportunity after opportunity.
  There are two main lines along which lie the hopes of peace in the world, political federation—not achieved in the way in which federation has been achieved within the past 24 hours—and economic co-operation. The Treaty of Versailles secured neither of those two objects, and no serious effort was made by any Government in this country or in France, during the 10 years after the making of that Treaty, to obtain either of those two objectives. The fundamental problem which confronted us during those years—that of French security—was not faced by any British Government. That was why, year in and year out, the French Government allied themselves with the forces of darkness and obstruction rather than with the forces of light. I see no use in going once again over that well-worn ground, but I want only to say to the right hon. Gentleman that this party and this side of the House have not the monopoly of blame and discredit. We are all to blame, because Government after Government in this country made no constructive effort to mitigate the severities of the Treaty of Versailles in order to bring about a better situation.
  Whatever hon. and right hon. Gentlemen may say with regard to the present situation, collective security has not yet been given concrete form. I supported the right hon. Gentleman the Member for Caithness and Sutherland in regard to the Hoare-Laval pact; I think that we should have brought every possible pressure to bear upon Italy at that time. I knew that it was the last chance of the League in its old form, and, therefore,
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  I was against the Government of the day, and against the Hoare-Laval proposals. As soon as I realised that sanctions were not being taken seriously by ourselves or by the French Government—and I blame M. Laval much more than I blame the British Government; I do not see why we should always take the blame for everything—I turned right round and said that if we were not to have adequate sanctions let us stop sanctions altogether and try to make friends with Italy while there was yet time. I did not believe in trying to carry on a half-hearted policy of sanctions, which was achieving nothing effective for collective security, but which was alienating Italy and making practically inevitable the events which have taken place during the last 24 hours.
  Although we have not collective security in any concrete form at the moment, and although I think the Opposition parties are fooling both themselves and the country in pretending that we have, fortunately we still have the friendship of France, and that is a very concrete thing. This, at least, we must hold on to. I would go further and say that I believe it would have a stabilising influence in Europe and in the world if the Prime Minister were to reiterate that, if France is involved in a European quarrel which involves her being attacked, we shall go to her support with our armed forces at once. I believe that that would be a very great safeguard for the peace of Europe from now onwards; and from that point of view I would beg the Government to consider very seriously making a substantial addition in the very near future to our first-line air strength. This, I believe, is a subject which is causing great anxiety on both sides of the House. We were not quite satisfied with the Prime Minister's statement the other day that he had ceased, for practical purposes, to measure our air strength in terms of first-line machines against Germany. That is the ultimate test; it is the test which was given to this House, and which we accepted; and I hope that the first announcement the Government will make will be that at the earliest possible moment they intend to raise our first-line air strength to parity with Germany, whatever the cost; even if it involves some form, not of human conscription, but of industrial conscription; even if it in-

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  volves working factories by day and night. I believe that it would have a very stabilising effect on the European situation.
  In conclusion, I come to the point with which I dealt in my opening remarks, that raised by my right hon. Friend the Member for Caithness and Sutherland. I do not think we can expect the French General Staff at this juncture to contemplate with equanimity a Fascist-controlled Spanish Government in their rear, a possible enemy on their right in Italy, and another potential enemy in the North-East. I submit with all respect to His Majesty's Government that in this game of power politics, for that is what we are all playing to-day, although it is against our will, time is of the essence of the matter; and I do not think we ought to delay too long in getting these Fascist forces out of Spain. Here, at least, we have a lever, and a powerful lever, in our hands. We have not so much power at the present moment as many of us would wish; but we can at least say to Italy, "If you want an agreement with us, if you want our support in the Eastern Mediterranean, if you want recognition of Abyssinia, you must withdraw all your forces from Spain, lock, stock and barrel, within a measurable space of time; or, alternatively, we shall raise no objection to the French putting in an unlimited supply of munitions." Then, I believe, we should be nearer to getting a real agreement with the Italian Government than by any other method we can pursue. As the right hon. Gentleman quite truly said, there is only one language in the long run that the dictators, at any rate, can understand, and that is the language of power politics; but it is a language that can be used only when there is adequate force behind it.
  4.49 p.m.
  Mr. Arthur Henderson: The speech of the hon. Member for East Aberdeen (Mr. Boothby) will, I think, take the minds of many of us back to the position that existed in 1914. One would imagine, to listen to his suggestions, that the League of Nations had never come into existence, and that it was essential for this country merely to rely upon its own strong right arm. There are many people in this country who will not accept that view, and who are not prepared to return to the old pre-War system of balance of
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  power and alliances. If we are to be called upon to face up to the inevitability of war, it will only be in resistance to an aggressor and in defence of international law and justice. The hon. Member referred to the fact that all Governments since 1919 were to blame for not mitigating the evils of the Treaty of Versailles. If it were relevant to this discussion, I -should have no difficulty in joining issue with him on that point. I believe that the record of the Labour Government of 1919–31, so far as the Treaty of Versailles itself is concerned, compares very favourably with that of any other Government in this country or in any other country in Europe.
  Mr. Boothby: Can the hon. Member point to one specific qualification in the Treaty that was made by that Government; and is it not a fact that we continued to demand German reparations throughout that period?
  Mr. Henderson: The Labour Government, together with the French Government of that day, were responsible for withdrawing allied troops from the Rhine-land five years before the time stipulated in the Treaty of Versailles. Whether that amounted to much or not, at any rate it received the approbation of the Gorman Government of the day, and they regarded it as a substantial contribution towards mitigating the provisions of the Treaty of Versailles. Apart altogether from that, while there may be a difference of opinion as to what Governments have done or have not done to mitigate the evils of the Treaty of Versailles, we on these benches can, at any rate, claim to have no responsibility at all for that Treaty. The responsibility for the Treaty of Versailles rested with other political parties than the one represented on these benches, and it was not 200 Labour Members of Parliament who signed the telegram to the then British Prime Minister asking him to squeeze the Germans until the pips squeaked. The second point to which the hon. Member for East Aberdeen referred was the failure to save Abyssinia, and he referred to his opposition to the half-hearted policy of sanctions. We on these benches would certainly agree with him in that; the failure was entirely due to the fact that the policy of sanctions was half-hearted. But again the responsibility for that halfhearted policy rests, not with Members

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  on these benches, but with the Government. [HON. MEMBERS: "And with the French Government."]
  I should like to bring the House back to the main issue which we are now discussing, namely, the recent events in Austria. The Prime Minister very briefly referred to the position of Austria under the Treaty of Versailles and the Treaty of Saint Germain. No Member of the House, and certainly no Member on this side of the House, would or could object to a majority of the people of Austria, or of any other country, expressing their right to self-determination and taking a decision to join with another country. But the issue we are facing to-day is not merely the amalgamation of these two countries; what we are concerned with is the method which has been adopted, and the implications which arise as a result of the application of that method. Is it any exaggeration to say that, as the result of what has taken place during the last 48 hours, it is impossible to-day to place any trust in the pledged word of Herr Hitler and his colleagues in the German Government? After all, the German Government, for reasons of their own, in July, 1936, signed an agreement with the Austrian Government, which contained these two main provisions:
  "1. The German Government recognises the full sovereignty of the Federal State of Austria.
  "2. Each Government undertakes to treat the internal political conditions of the other, including the question of Austrian National Socialism, as a domestic concern of that country upon which it will exercise neither direct nor indirect influence."
  If these words mean anything at all, they must mean that the German Government pledged themselves not to interfere directly or indirectly in the internal affairs of Austria. What was the next step? A few weeks ago, on 12th February, there was again an agreement between the two Governments, and, as the House will remember, on that occasion it was agreed both by Herr Hitler on behalf of his own Government and by Dr. Schuschnigg on behalf of the Austrian Government that:
  "Both Governments are resolved to keep to the principles of the agreement of July, 1936, and regard it as the starting point for a satisfactory development of their relations."
  If that be the case, how does Herr Hitler justify his attitude and action during the past 48 hours? The Prime Minister has
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  told us that at least two ultimatums were delivered to the late Austrian Chancellor on behalf of the German Government. We know that, subsequent to the delivery of these two ultimatums, anything up to 100,000 or even 200,000 German troops, accompanied by 300 or 400 German bombing aeroplanes of the latest type, have invaded Austrian territory. It is interesting to note that, in one of the papers which belong to Lord Rothermere, Mr. Ward Price, who is representing the Rothermere Press in Austria, and, apparently, is very well thought of by Herr Hitler, because he has had facilities that no other British journalist has had, refers to the fact that the German troops' entry into Austria is just a friendly visit, and he says that it is to be followed later on by a visit of Austrian troops to Germany. Incidentally, it may also interest the Prime Minister to know that, according to Mr. Ward Price, the German Government regard the British protest as a formality rather than as a serious warning. I feel sure, after what the Prime Minister has said to-day, that that is a grotesque misrepresentation at any rate of the intentions of the British Government, and that what they have done in connection with this protest was a sincere expression of their disapproval of what has taken place.
  It seems to me that there can be no doubt that Herr Hitler has treated his two agreements with the late Austrian Government as mere scraps of paper. We are getting back to where we were in 1914, when we were told by the then German Chancellor that necessity knows no law, and that that was the justification for the German invasion of Belgium. It seems as though Herr Hitler takes the view that he is entitled to break any agreement as it suits his purpose. In 1936, he defended his breach of the Treaty of Locarno on the ground that it was a dictated agreement, and, in a Note that was sent by the German Government to the British Government, dated 24th March, 1936, the German Government made this statement:
  "The following fact must be clear: Lasting agreements between the European nations with the aim of really guaranteeing peace can only be concluded in an atmosphere of sympathetic recognition and consideration of the natural equal vital and political rights of all the nations participating therein. Any tempt to introduce a new system of order

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  in Europe by the old methods of a hate-inspired division of the nations into those with more and those with less rights, into defamed and honourable nations, or even into dictator nations and subject nations, must lead to the same result because it would be begun under the old conditions, which have proved themselves to be pernicious, i.e., the new order will be no better than the old."
  Later on in the Note Herr Hitler's Government made themselves responsible for this statement:
  "Only treaties which have been concluded by parties with equal rights, and of their own free will and free conviction, can claim from both parties the same lasting and sacred respect."
  What is the observation to be made on these statements? Herr Hitler justified his breach of the Treaty of Locarno because, he said, it was a dictated agreement. The two agreements for which Herr Hitler has been personally responsible, and which he made with the Austrian Chancellor, cannot by any stretch of the imagination be said to be dictated agreements, except in so far as Herr Hitler dictated them to the Austrian Chancellor. But they were not dictated treaties from the German point of view. Therefore, we are entitled to point out that, even though the German Government are parties to international arrangements which they have entered into freely, voluntarily and of their own accord, without any pressure from any other Government, they are no more to be relied on to fulfil their obligations than in the case of treaties such as the Versailles Treaty which they regard as a dictated treaty.
  We are told that this occupation is to be followed by a plebiscite. Was there ever such a mockery? Only this morning, the papers informed us that the Germans have formally annexed Austrian territory. They have sent large numbers of troops, artillery and aeroplanes, accompanied by thousands of members of the German secret police, the Gestapo, and it does not require much imagination to realise what are the conditions under which the plebiscite is likely to be conducted, and what little degree of freedom there will exist for the Austrian people to register their votes. I hope that public opinion, of this country at any rate, will not be influenced in any way by the suggestion that Herr Hitler is going to give the Austrian people every opportunity to register their views on the question of
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  Austrian independence, because now it is too late.
  The Prime Minister has made his choice. He has told the country that he prefers to negotiate with the Italian Government without stipulating any conditions. The House was warned by the late Foreign Secretary that that policy was a mistake, that the Italian dictator was so unreliable that it was essential to obtain guarantees before the present negotiations were entered into. The Prime Minister took a different view. I hope, at any rate, that he will also remember that the Italian Government have bound themselves, under three separate agreements, to safeguard the independence of Austria. On the first occasion, the Governments of France, Italy and the United Kingdom agreed to 17th February, 1934, to take a common view as to the necessity of maintaining Austria's independence and integrity. That was reaffirmed by the same Governments in September, 1934. Then there was the Franco-Italian agreement, signed in Rome in January, 1935, in which, according to an official communique, the Governments agreed
  "in view of the necessity of maintaining the independence and integrity of Austria, that from henceforth in the event of this independence or this integrity being threatened, they will consult together and with Austria regarding the measures to be taken."
  That was confirmed at the Stresa Conference in 1935. If words mean anything, the Italian Government are obliged under international engagement to take action, or, at any rate, to consult, with the French and British Governments.
  The Prime Minister indicated dissent.
  Mr. Henderson: The Prime Minister shakes his head. Let me quote. They accept
  "the necessity of maintaining the independence and integrity of Austria."
  and
  "will consult together and with Austria regarding the measures to be taken."
  There is, at any rate, an agreement to consult. Is the Prime Minister satisfied that the Italians have entered into consultation with the French Government, with Dr. Schuschnigg, and with the British Government for the purpose? He knows that they have done nothing of the kind. Here we have another example of the unreliability of the Italian Government in regard to the carrying out of their

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  international obligations. I hope that, not only for the sake of the Prime Minister himself, but for the sake of our own country, he will be very careful in the next few months as to how he allows the Italian Government to deal with him over these negotiations. I agree with the powerful speech made by the Leader of the Liberal Opposition. I believe that the tragedy of the present situation has been very largely produced by the failure of the Governments at Geneva to make the League system effective. The Prime Minister tells us that the League is powerless to protect small nations; but, after all, the League is not an entity of itself; it is merely an international assembly, and if it has failed, the Governments represented there have failed; the British Government has failed, and the responsibility for that eventually comes upon this House.
  What action is this country going to take if Czechoslovakia is the next victim of German aggression? I know that there are those who say that we cannot commit ourselves in advance. There are many who take the view that if this country had committed itself in advance prior to 1914 the Great War would have been averted, or, at any rate, postponed. I suggest that in the event of France fulfilling her League and Treaty obligations, as a result of aggression against Czechoslovakia, and this being followed by invasion or attack upon French territory, this country will be involved, whether we wish it or not. The Prime Minister prides himself upon his ability to face up to realities; I hope he will face up to that, and make it plain where the British Government stand. It is no use allowing the German Government to imagine that if they attack Czechoslovakia, all that the British Government will do will be the same as they have done in the last few days over Austria. We require firmness, even if the Prime Minister wishes us also to be prudent. Firmness tempered with prudence, should govern our policy at the present time. I hope the British Government will realise that, however ineffective the League may have been as a result of lack of moral support on the part of the nations represented at Geneva, that is no excuse for our accepting a return to power politics as inevitable. We can take the choice of hanging together or hanging separately.
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  I should have thought that we could persuade all those nations who are genuinely desirous of building up a peace system to combine together. That does not mean keeping Governments outside because we do not approve of their form of government; it does not mean insisting on dictator nations accepting democracy. What we ask them to do is to subscribe to the principles on which the League is based: first, recognition of the sanctity of treaty obligations—if that had been the case with Austria, she would never have been invaded by Germany in breach of treaties; secondly, peaceful settlement of all disputes; thirdly, disarmament; fourthly, the provision of machinery for the remedying of grievances. What sane person can object to those principles? If the British people and the British Government accept those principles, and other Governments accept them, is it not worth while for these Governments to combine, and say, "We will resist any Government which breaks the peace." It does not mean that we are to make an attack on any country; it means that we are to defend ourselves against attack and to prepare, both unilaterally and collectively, to resist aggression. I ask the Government to employ, before it is too late, all the moral influence we can wield, and give a lead along the lines I have suggested, and ensure that all nations who believe in peace combine together in defence of the principles of peace. As long as they fail to do that, I believe that the militarist nations will repeat what they have done in Abyssinia, in Spain and in Austria. I appeal to the Government to take action before it is too late.
  5.12 p.m.
  Brigadier-General Sir Henry Croft: This is an occasion which I think every Member in every party must feel is one of the utmost gravity. We have listened to a very clear statement from the Prime Minister, telling us the story, and have heard other speeches following. I hope the hon. Gentleman who has just sat down will forgive me if I do not follow him through his various historical references to the situation in Europe. He seemed to think that the Government which his party formed was more successful in keeping the peace of Europe than others that followed. When he was asked in what particular they had succeeded, he replied that they, along with the French, had decided to come away

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  from the Rhine five years before they needed to do so. I suppose that if there had been an unreasonable Opposition at that time, they would have called it "the retreat of the democracies." The hon. Gentleman went on to suggest that we must have firmness tempered with prudence. I am sure we are all united about firmness, but, as one of the oldest Members of this House, I wonder whether this Debate has been altogether prudent. We are considering a terrible event. Whatever the views of Members in the past as to the possibility that in the days to come Germany and Austria would come together, I suppose there is not a Member of this House who does not deplore the brutality of the method which was employed by Germany in the last three days.
  But, while we feel this dangerous shadow over the world, are we being prudent, in accordance with the advice of the hon. Gentleman, to take this occasion, in a Debate which I understood was to deal with Austria, to make many attacks against Italy, and an attack against what may possibly be the emergent Spain—these two countries in the Mediterranean? I remember very clearly how it seemed to me after the War, when, at first hand, I had seen what my countrymen suffered, and I was not quite so ready to regard those events merely as a boxing match, at the end of which the parties shake hands. I cannot forget that, time and time again, those who are attacking His Majesty's Government to-day—when the late Mr. Ramsay MacDonald was Prime Minister I remember him speaking for his party at that bench—told us that Germany was so impoverished that whatever happened we must put her on her feet again. These phrases were used time and time again. That country which was so impoverished, and which it was so necessary to put on her feet again, as far as I can gather has spent some £4,000,000,000 or £5,000,000,000 sterling in rearming the country. I emphasise these facts only to suggest that it ought to be a lesson to us in every part of this House that, as long as human nature is what it is, we have to be strong and have to face the fact that we may have to rely very largely, as we always have had to do in the past, upon our own strength.
  Mr. James Griffiths: The hon. and gallant Gentleman has referred to the action of the late Prime Minister of a Labour Government when he made an appeal to this House that we should help impoverished Germany. He should remember that at that time there was another Government in Germany and there was no evidence that Germany was rearming.
  Sir H. Croft: I do not want to go into the whole story. What is the good? If it was desirable, I think that I could bring the hon. Gentleman evidence that during almost the whole of that time armaments were being hidden away and kept from the Allied Commission in Germany; that an air force was being built up by subterranean methods and thousands of young men were being encouraged to learn the art of flying even by means of gliding clubs and so on. I was in Germany and saw these things going on. I think that we were too ready to assume that we were right in disarming and too ready to go to the country and hold peace ballots and say that we should get rid of armaments.
  The right hon. Member for Caithness (Sir A. Sinclair) made a very eloquent speech. The first part of it was admirable in tone until, because Germany had gone into Austria, he thought it necessary to attack the Prime Minister. He regretted the fact that we have these differences of opinion in this House, and he was very strongly in favour of the democratic government of Barcelona while I am equally strongly in favour of the Nationalists. The right hon. Gentleman has been kind enough to say that I am sincere, and I know that he is as sincere in holding his own views. Why did he have this fear of victory? I do not know whether he thinks that a Spain, possibly under the dominance of Communism, would be more helpful to this country than a Spain under the influence of Italy and Germany. Personally, I think that both these perils are equally grave, but I am an Englishman, and I desire to see Franco win—because I believe there is a danger of Christianity being completely wiped out in a country like Spain. [Interruption.] When before the revolution I saw the wholsale destruction of churches and when I saw, as the "Times" stated at that time, that the law no longer ran and the liberty of

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  man no longer existed, I feel convinced we must hope that the forces of law and order will win in Spain.
  This is not a matter which can properly be dealt with in this Debate, but it has been dragged into it. I am as convinced as any man can be that Franco is a proud Spaniard and that the temperament of the Spanish people is such that they will not allow themselves to go under Fascist domination. I believe that it is as inevitable as the sun will rise tomorrow morning that General Franco will win the civil war, and if he does how unwise it is to make enmity with a future Spain, both sides of which, in my opinion, desire the friendship of this country more than any other country in the world. If at the conclusion there was an attempt to dominate Spain, I for one would be absolutely prepared to go to any lengths in order to say that Spain must be free. [Interruption.] I declare that, and hon. Gentlemen above the Gangway do not seem to approve of it. They are prepared to go to any lengths in any other part of the world: in China, in Abyssinia, in Austria, in Czechoslovakia. If I saw the vital communications of this country threatened, I should be prepared to go to any lengths to defend the liberties of this country, and securing a free Spain.
  I do not intend to keep the House very long, but I want to say a few words with regard to a remark which was dropped by the Leader of the Labour party and by the hon. Gentleman the Member for Kingswinford (Mr. A. Henderson). They endeavoured to make a small point by saying how right the late Foreign Secretary was. The late Foreign Secretary is a friend of mine. I have the greatest admiration for him. He is one of those young Englishmen who know what war is, and he is a statesman also and is not likely to plunge his countrymen into great dangers and difficulties. Could he have altered the events of two days ago? Is there any honest man who believes that Germany would have been deflected from her purpose because the Foreign Secretary had remained in office? If that is so, is it not a little unfair to make a small party point of that kind? [Interruption.] I am sorry if I have given offence to the hon. Gentleman at any time.
  Mr. George Griffiths: Do you never make a small party point?
  Viscountess Astor: That from a member of the Salvation Army.
  Sir H. Croft: I am indeed sorry if I have given offence to the hon. Gentleman at any time, as I particularly want his good will.
  Mr. J. Griffiths: On a point of Order. Is it in order for an hon. Member to make an interjection across the Floor of the House referring to the religious belief of another hon. Member?
  Sir H. Croft: I am very sorry if—
  Mr. G. Griffiths: It was not what the hon. and gallant Gentleman said but what was said by another hon. Member. This is not the first time it has been said. It has been said half-a-dozen times and I have taken it quietly, but I shall not take it quietly much longer.
  Sir H. Croft: The point which has been made from these benches to-day is that, on successive occasions, owing to lack of action, we have been landed in the present situation. Members of both Oppositions have once more declared—and I particularly call attention to the fact that the right hon. Gentleman the Member for Caithness (Sir A. Sinclair) and the leader of the Opposition have done so in ringing terms—that the time has come when the democracies of the world must make a stand. There must be a collective stand—I think that those were the words of the leader of the Opposition. What does that mean precisely in this Debate? Does it mean that the deplorable affair in Austria is one in which the democracies have to take a stand, and, if so, does it mean that an attempt must be made to reverse the situation? The right hon. Gentleman the Member for Caithness says it is too late, and I agree. Therefore, what did the right hon. Gentleman mean when he said that the democracies must take a stand—to link up with collective security in which he still believes? With the immense decisions which may have to be taken in the days to come, is there a man in any party who really believes that the small nations of Europe are prepared to engage in collective security to-day? If you inquire whether they are prepared to sacrifice the lives of their nationals in such a scheme

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  —and I try to keep in touch with distinguished citizens of these countries—you find that not one of them is prepared to put an army, fleet or air force in the field for collective security—not one. I do not want to go back to past history, but, surely, when hon. Gentlemen were criticising His Majesty's Government at the time of the Abyssinian affair—a most expensive experience it was on our part, I agree—was there another country anywhere that was prepared—
  Mr. A. Henderson: The hon. and gallant Gentleman has asked the House a question, whether there is a small country in the world which is prepared to face up to its military liabilities or obligations under the Covenant of the League? Are we not entitled, before we answer that question, to know whether the large countries, including our own, are prepared to face up to them?
  Sir H. Croft: I think that the House will agree that the interruption was not to the point. When the whole question arose at the time of the Abyssinian affair, is there anyone who can now say that the various countries were prepared to sacrifice the lives of their nationals?
  Mr. Noel-Baker rose—
  Mr. Deputy-Speaker (Captain Bourne): The hon. and gallant Member for Bournemouth (Sir H. Croft) is addressing the House, and the hon. Member cannot intervene unless the hon. and gallant Member gives way.
  Mr. Noel-Baker: On a point of Order. The hon. and gallant Member challenged any Member of this House to say which countries would have fulfilled their obligations under the Covenant. I was prepared to give an answer to that challenge. If the hon. and gallant Member will allow me I will give the answer now.
  Sir H. Croft: I have been interrupted by so many hon. Members.
  Mr. Noel-Baker: May I ask the hon. and gallant Member whether he has read the cicular Note issued by the British Government to other members of the League inquiring whether, if Italy took military action against us arising out of sanctions, they would give us military help under the Covenant of the League, and has he read the answer that all the Mediterranean Powers were unanimous to
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  the effect that they would fulfil their obligations?
  Sir H. Croft: I am equally well aware that France was not prepared to mobilise and that not a single one of the nations mentioned by the hon. Member was prepared to move a single ship, or a single battalion, or a single man.
  Sir A. Sinclair: We were not attacked.
  Sir H. Croft: Abyssinia was mentioned. I want the House to consider the position to-day. If it is a fact that there was no general readiness on the part of those nations to offer the lives of their nationals at that time, can anyone honestly say that to-day the world has moved in the direction of collective security and is prepared to mobilise its armies, its navies and its air forces for it? If I am correct in my view, are we really not deceiving the people to say that they can rely upon the armies and navies of, say, Norway, Sweden, Denmark, Rumania, Czechoslovakia, Switzerland, Greece and other countries? To persist in that idea in view of the facts, and faced with the realities through which we are passing is a shame and a fraud against the people of this country.
  Very little has been said about the possible co-operation of the British Empire. I share the views of the Prime Minister that we ought to attempt to make friends with any country with whom we can make friends, and I think it is fatal that in this House we should have daily insults of different countries. Only three weeks ago eight different countries came under the censure of hon. Members above the Gangway. The times are too dangerous for us to allow reports to go out to the newspapers of those different countries, when we want honest friends who will stand by us. That being the case, I suggest that the finest line of policy we can adopt is to get closer and closer to the sister nations of the British Empire. Whilst showing that we are absolutely prepared to stand by France, Belgium and Western Europe in our pledge, the only definite pledge we have, we should get closer and closer to the British Empire. There are 500,000,000 people in the British Empire, and we have great strength behind the Empire. In the last War it was the contributions from the Dominions and the Empire which finally turned the scale

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  This is not the hour to talk about breaking up the British Empire. This is not the hour, because you are afraid of the threats of any dictators, to offer to get rid of our great Colonial Empire, as is suggested by some; still less is it the hour to suggest that in order to try and prevent the happenings of last week we should endanger the strategic position of the Empire by talking about parting with any mandated territories. The time has come when we should call the nations of the Empire into council together once more, in view of the urgent situation of to-day and ask their co-operation in a great scheme to strengthen the cause of peace. Through our strength as a united Empire as a whole, I believe that we should be in a far better position to make our influence felt in the world.
  One thing I think we can all agree upon. I am sorry that I have been deflected from my main point. There is not a man, whatever his position, however much he desires to see new friendship established with Germany, who does not say that we deplore what happened last week. There can never be a better understanding in the world so long as that kind of law is allowed to run against civilisation. I suggest that we should proceed to make stronger friends, stronger links with the Dominions of the British Empire, and that we should consolidate our strength to meet dangers from whatever direction they may come.
  5.36 p.m.
  Colonel Nathan: I share the view of the hon. and gallant Member that the greatest single agency for peace in the world at the present time is the British Empire, and that our efforts should be directed to bringing the British Dominions ever closer and closer together. A common culture and common traditions are links which bind the nations of the Empire together. There is of course the organic link of common allegiance to the Crown. The hon. and gallant Member forgot that there is also independent membership of the League of Nations. The fact that each of the Dominions is an independent nation represented at Geneva gives the greatest opportunity for cementing the common policies of the various units which comprise the British Empire. The argument which the hon. and gallant Member has advanced is an argument for support now and at
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  all times of the League of Nations, in an effort to make it ever more effective for its purpose.
  The Prime Minister made to-day a statement, the gravity of which it is impossible to over-estimate. There were omissions from it, inescapable omissions, as to what view the Government take of their policy for the future. Doubtless, the time will not be long delayed—it is to be hoped it will not be long delayed—when we shall be informed of the results of that fresh review upon which the Government are now embarking in the changed circumstances of the day. It is a sombre picture of the future which the right hon. Gentleman has painted. He used one phrase of which I should like an explanation, a phrase which he might elaborate, a phrase which, in my mind, and in the minds of other hon. Members, has created much doubt as to its meaning. He said that no one could feel himself excluded from the national effort which will be called for. I do not comment upon the phrase and I do not criticise it, but I simply ask, what does it mean? I trust we may be given the information without too long a delay.
  The right hon. Gentleman said that this was no time for careless words. I shall try to keep that behest in mind. But hon. Members would be burking the facts if they were not to realise that the carefulness which is imposed upon us is a carefulness which has by no means been borne in mind by Herr Hitler, Field-Marshal Goering and members of the German Government. Herr Hitler has been very free in his criticisms of the British Press. He has called for restrictions on the freedom of the Press. He has asserted time and again that the British Press has been guilty of mischievous and lying statements. The British Government is entitled to claim that there has been nothing which has been more mischievous, which has been more misleading, nothing that has had more dire results than the statements which have appeared in the German Press during the past few days as to the occasion for the German Government's action in Austria.
  From the sober statement of the Prime Minister we know some of the facts of the position, and we have heard the text of the communication addressed by the German Foreign Office to the British Government, couched in terms which must be

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  unique in the history of this country. I have not observed that any great publicity has been given to that statement in the columns of the German Press. The British Press, despite the upbraidings and the criticisms of Herr Hitler, is performing a vital public service not only to this country but to the peoples of Europe and the world, so long as it continues to give well-considered information, authenticated as far as circumstances will permit. If occasional errors are made in statements, then none is more responsible than the German Government itself, which makes it extraordinarily difficult for accurate information to be obtained.
  In the record which the right hon. Gentleman gave us in his speech this afternoon it is clear how much room there is for difference of interpretation of the facts and even as to what facts have and have not existed. It was suggested, for instance, in the statement of Baron Von Neurath, that the German Government had no intention up to the last moment, until, I think, Friday, or it may have been Thursday, of moving any troops into Austria, and yet we know that 60,000 or 100,000 troops have been moved, with all the accompaniment of artillery and aeroplanes. This House really cannot be asked to believe that a force of that magnitude could be mobilised and put into motion in the period of two or three hours, still less can it be believed that there was no intention to move German troops until the new Chancellor of Austria had sent for them, if he ever did seek that aid from Herr Hitler.
  I suspect that the truth is rather nearer the statement made by Mr. Garvin yesterday in the "Observer." Mr. Garvin is not a great opponent of Herr Hitler or of the other dictators. Mr. Garvin revealed yesterday that on his information, or in his view, the action of Herr Hitler had been taken in order to avoid the disclosure at a State trial, at the instance of the Austrian Government, of the machinations of Herr Hitler and his Government with a view to disturbing the internal situation in Austria. That lends itself to the inference that even from the moment of the meeting at Berchtesgaden Herr Hitler's plan had been in course of mobilisation, and that last week's event was not the beginning but the end of a beginning which started some time before. There can be no doubt that whichever of the suggestions be true, Herr Hitler was
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  motivated by a fear that the plebiscite ordered by Dr. Schuschnigg would give a result favourable to the maintenance of Austrian independence and unfavourable to the insolent pretentions of the Nazis of Austria. Had it been otherwise, does any hon. Member think it likely or even possible that Herr Hitler would have marched into Austria? Of course not. He would have greeted the result as a great triumph for the cause of Nazism and would have said that Austria was joined to Germany by the will of the Austrians themselves. It was because he knew that once the event was put to the test the result would be the contrary, that he took time by the forelock and marched his troops and invaded this defenceless country.
  In the past Herr Hitler has claimed justification for the repudiation of treaties on the ground that they were enforced upon Germany. We in this House may admit, whatever view we may take as to the lawlessness of his proceedings, whatever view we may take of his breaches of international right and the obligations accepted by the German Government under treaties which Herr Hitler says were enforced treaties, that at least these breaches were for reasons which left us a little uncomfortable as to the righteousness and justice of the position in which Germany had found herself. But, said Herr Hitler, in any treaty that we enter into freely and of our own accord our signature is our bond. It was only in July, 1936, that Herr Hitler committed himself to the independence of Austria by a formal agreement between Germany and the Austrian Government. It was only a month ago, in February of the present year, that Herr Hitler reiterated his respect for the independence of Austria. His words have once again been broken. He has forsworn treaties and obligations freely undertaken by himself. It may be truly said:
  "His honour rooted in dishonour stands,
  And faith unfaithful makes him falsely true."
  What a picture must the people of Austria hold before themselves at this moment as to their future. I have been reading the Debate in this House in April, 1933, when Herr Hitler first came to power in Germany. A great and powerful speech was made by the late Sir Austen Chamberlain. It was a prophetic speech. His words have indeed come true. The world has been set by the ears by Herr

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  Hitler. Is the new regime in Austria to be any less oppressive than the Nazi regime in Germany? What is to be the position there of Social Democrats? Are they to be crushed as they were in Germany? What is to be the position of the trade unions and their resources? Are they to be confiscated, as in Germany? What is the position of the Catholic and Protestant churches? Is there to be fresh martyrdom in Austria? What is to be the position of my own co-religionists, for, Jew myself, I feel for my fellow Jews in Austria? Are they to suffer the same dire persecution, the same fate, that has overtaken them in Germany? The signs are bad, the portents are dismal. In the "Times" of to-day I saw a report that a Jew of some distinction seeking to leave Austria had his passports taken away from him, torn in pieces and thrown back in his face. He bore the name of Rothschild, a name not unknown in this House, or in the world outside. Are all passports of Jews to be torn up like this? Is that the sort of thing which unoffending citizens of a country which they have served and fought for are to meet under the new regime in Austria as in Germany?
  I ask whether His Majesty's Government propose to make any representations to the German Government on this score? Representations, do I say? What is the use of representations to a Government which makes the reply we have heard to-day to a recent protest? Hon. Members will believe me when I say that I do not desire, in a matter of this gravity, to embark in the least upon mere party debating points which can be flung across the Floor of this House. I do not desire to indulge in political recriminations. The hour is too serious for that. But I should like to ask the Government whether they can give any information that between Herr Hitler and Signor Mussolini there is a bargain; Hen-Hitler being permitted to carry his troops to Brenner if Signor Mussolini may have in return, what? Is it Spain? Is it Spanish Morocco? Can the Government give any information as to whether there is a bargain, and, if so, what the bargain may be? At the present time there is no German Ambassador at the Court of St. James, and in view of the present situation, in view of the breach of treaties perpetrated by Herr Hitler, in view—I scarcely know how to characterise it, but
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  I will not apply any epithet—of the reply given by Baron von Neurath to the British Government, is it proposed that His Majesty should be advised to receive a German Ambassador at the Court of St. James?
  One thing is clear, and that is that we should proceed—I speak strongly and for myself—with resolution, determination, efficiency, and speed with our rearmament programme—above all, with speed. I do not delay to criticise the past attitude of the Government towards some of the problems with which it has been confronted, but may I underline this? Let not the importance of the home front be overlooked, the importance of air-raid precautions, the storage of food and the conservation of our economic and financial resources in order to meet the dire event. I think the Government have paid far too little attention to the economic and financial situation of this country in the event of war. I believe that I am speaking for others as well as for myself when I say that at a moment such as this, pregnant with such grave possibilities for the future to our own country, to Europe and to the world, we must bring all adherents we can to the cause of the preservation of international law and the rights of nations. It may be that collective security is for the moment a broken reed. I do not agree, I do not admit it, but I will concede that argument to hon. Members if they wish to use it. Let us do our utmost, our best, to make it effective if it can be made effective. Let us arm to make our contribution to collective security and be able to defend ourselves should collective security break down.
  5.56 p.m.
  Mr. Amery: I want in a few words only to appeal to the House, in view of a situation of such gravity as we are facing to-day, to forget the past and leave alone as entirely irrelevant who may have been right or who may have been wrong in our controversies over foreign affairs Hon. Members opposite, I know, hold firmly to the belief that the policy they have advocated, if pursued confidently and with determination and at the cost of risks—which, I must say, they have never themselves been fully prepared to face—might have succeeded. For my part I hold an entirely different view. I believe that the attempt to pursue that policy has been the main cause of the troubles

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  which we have to face to-day. But let that pass. The compromise between two policies which in fact we have followed has allowed us to drift into a situation of terrible danger. Has not the time come for us to face the facts of the present and the future and to close our ranks in face of a common danger?
  Let me remind the House of what has happened. A small nation, standing for something rather unique in the world, the last remnant of that old tradition of a united western Christendom, a super-national State, after the despair of the post-War years, confronted with a tradition profoundly repugnant to itself, had swung round behind two distinguished and remarkable leaders, Herr Dollfuss and Dr. Schuschnigg, in faith in its distinct mission in Europe, a faith which would have been endorsed yesterday, I believe, by an overwhelming majority of the people. That will of the people has been trampled down by brute force. Why? Because whatever they may have wished on behalf of liberty they were not prepared to defend it with their blood.
  If we wish to preserve our liberty in the dark generation which may lie ahead, we shall have to remember that the price of liberty is eternal vigilance, in arms as well as in spirit. Therefore, let us get on as a united nation with whatever preparations may be necessary to make us secure. At the same time let us not forget—and to that extent I agree with hon. Members opposite—that no preparations single-handed can meet the problem in front of us. We have to look to those who will stand with us for the peace of Europe. To whatever extent the existing League can help us in this matter, by all means use it. But let us also not forget the actual facts; the formidable nations who stand outside; the nations in the League who are half-hearted and who are by no means prepared to run risks. Looking at it from the practical point of view, considering those whose help we may be able to secure and those whose neutrality we may be able to secure, I say that, difficult though the situation may be, we must all wish the Prime Minister success in the negotiations he has undertaken.
  We must no longer go on drifting or halting between inconsistent policies. We must have a clear-cut policy one way or the other, or we shall certainly end in war. Austria collapsed because she was
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  not prepared to fight. We all know that Czechoslovakia will fight. What are we going to do about that? One thing that will mean war is for us to go on havering, half encouraging Czechoslovakia, half encouraging France with the idea that we stand behind her, half encouraging Germany to think that we shall run out, and then at the last moment, in a revulsion of sentiment, coming in for what may be the greatest disaster that Europe and the world have known. Let us either make up our minds that we must stand out, and let everybody concerned know it, or let us say to France, Czechoslovakia and Germany, in language as plain and simple as we can make it, that the first German soldier or aeroplane to cross the Czech border will bring the whole might of this country against Germany. Those are decisions of immense difficulty. They require a united nation, and they require a measure of preparation not only in arms, but in policy, such as we have not known hitherto. The Prime Minister has told us that in a very short time he will indicate to the nation what are the measures to which he would wish us to respond. I would only say to him, "Do not be afraid of asking of the nation all that you think right and necessary."
  There is one other word I would add. In re-equipping this country, I ask my right hon. Friend to consider very carefully the central organ with which the Government and the policy of this country are conducted. I had the experience of the breakdown of the ordinary peace Cabinet system in the Great War, and I saw how the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) saved the situation in large measure by creating a more effective instrument of policy in a small policy Cabinet, the members of which were divorced from the routine of departmental responsibilities and were able to meet continuously and to frame a coherent policy over and above the conflicting interests of the Departments. I most earnestly appeal to the Government at this hour to consider whether the emergency is not already with us. I believe it is a fact. I believe that, to meet that emergency, we should go back to the so-called War Cabinet system. I believe that, for that purpose at any rate, the emergency is already with us. I earnestly appeal to the House to consider whether, among our measures of preparation, some small body in the

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  nature of a policy Cabinet should not be set up at once. I would even go further and say that were it possible it should include Members of other parties, besides the party now in office, to make the Government more truly national than it is to-day. I am sure I am speaking for the great body of Members, at any rate of my party, when I say that they would only too gladly welcome such action on the part of the Government and on the part of their political opponents.
  6.5 p.m.
  Miss Wilkinson: The speech of the right hon. Gentleman the Member for Spark-brook (Mr. Amery) is one of considerable importance. Nobody can doubt the very deep sincerity with which the right hon. Gentleman has spoken, but I would utter a word of warning. There is one way in which Germany could dominate this country and defeat this country without moving a ship or a gun, and it would be, not that this country should become politically a vassal state of Germany, but that we should be dominated by German ideas. If that happened, Germany would have won. I was very greatly disturbed by a letter in the "Times" this morning from Lord Lothian, in which he appealed for national service, in words that might have been used by Herr Hitler himself. I cannot help feeling that the suggestion thrown out by the right hon. Gentleman the Member for Sparkbrook regarding a war cabinet and the end of the party system—
  Mr. Amery: I did not suggest that.
  Miss Wilkinson: That is what the suggestion meant.
  Mr. Churchill: He did not mention it.
  Miss Wilkinson: Certainly the circumlocution by which in this House right hon. Gentlemen surround their statements is something which has aroused my wonder since I have been here. The right hon. Gentleman's suggestion means the control of all the people in this country in the interests of the people who are at present running the country. When they speak of national service, let the party opposite remember that we stand for no conscription of the manhood of this country without the conscription of the wealth of this country. There has been a great deal of talk in the Debate about getting above party issues. Lord
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  Brentford once remarked that when he asked people to get above parties, he always meant that they should follow his party. I can well understand that the right hon. Gentleman the Member for Sparkbrook and other hon. Members opposite who have spoken intensely dislike the Debate that we are having today. Why? It is because we are witnessing to-night the complete breakdown of the foreign policy of the Conservative party since 1919. Hon. Members opposite may sneer at the Labour Government and the Labour party if they please, but they cannot avoid recognising that since the signing of the Versailles Treaty, the Labour party has said that if an attempt were made to keep a great nation such as Germany in a strait-jacket and to ring her round with steel, the time would come when there would be an explosion.
  I remember vividly being in Berlin two or three days after the Reichstag fire, and the first terror election under Hitler. I was talking to a man who, I think, is now the German Ambassador in Tokio, on the day on which the Prime Minister of this country made a speech in Rome with regard to the revision of the Peace Treaties, and that German said, "For 11 years, except when the Labour Government was in power, the German democratic statesmen brought back nothing but insults from the Allied statesmen. Hitler has banged the mailed fist and within four days your Prime Minister is talking about the revision of the Peace Treaties. If that speech had been made a year ago, it might have saved German democracy."
  I do not wish to make cheap party capital, but it is a fundamental truth that the Labour party pleaded for an international policy, pleaded for support of democratic Germany, pleaded against the blockade of Germany after the War and the starving of her children, but we were met only with sneers, and worse, from the party opposite. They have had all the power, except for two years and eight months of minority Government, and to-day we see where they have brought us. If there is any responsibility, it rests with the party opposite and not with us. The Prime Minister said—and I am sure he meant it—that he wished to deny the statements that are being made that either he or his Government has given any encouragement to Germany or the German Chancellor with regard to

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  their taking of Austria. But there are all sorts of ways of creating an atmosphere, of indicating a mood. At how many dinner parties given in London where Herr von Ribbentrop was present, in how many aristocratic houses, has the mood been indicated that of course we do not want to stand in the way of Germany, and that if Germany takes Austria there will be no question of any fighting? How much money has been spent in one way or another on the social invitations of the Germany Embassy? A certain atmosphere has been created.
  One has only to consider certain newspapers, such as the "Times" and the "Observer." It was not a Member of our party, but a Member of the Front Bench opposite who said that he read Mr. Garvin's article every Sunday morning to discover what piece of the British Empire that gentleman proposed giving away to Germany that day. The attitude of the "Times" and the "Observer," right up to the last week-end, has been not merely to plead for an understanding with Germany, but to give the impression that certain ambitions of the German Chancellor could be rightfully fulfilled. It is not possible to do that for five weeks, five months or five years without your finding that one week-end they have taken you at your word. The "Times" is regarded abroad—it may not be rightly so regarded—as the almost semi-governmental organ of this country, and it is always quoted as such.
  Ever since the right hon. Gentleman the Prime Minister took office, there has been a change in the atmosphere in this country. It is no use denying that, for we all know it, and hon. Members opposite have hailed it with joy. It was not possible to send an ambassador extraordinary, or whatever Lord Halifax then was, to undertake private conversations with Herr Hitler at a time when there was in power a Foreign Secretary standing for a definite line of policy, as the right hon. Gentleman the Member for Warwick and Leamington (Mr. Eden) did, without giving the impression not only in Germany, but in Paris, Prague and Rome, that British policy was divided. The Premier may say that he did not wish to do that, but when, after a week during which every newspaper in Italy demanded the resignation of the British Foreign Secretary, the Foreign Secretary went, what more encouragement could
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  have been given to the contemptuous attitude which was shown by the letter from the German Government which the Prime Minister read? That letter was intended to have that contemptuous flavour, which the House must have recognised as the Prime Minister read it.
  I would like the Prime Minister to reply to one statement which has appeared in the Press. I do not ask him to deny all Press statements about himself. I recognise that if the Prime Minister of this country were to try to deny all the Press statements made about himself, he would not have any time to govern the country. But there is one statement which is being made in very responsible newspapers to which I wish to draw his attention. I refer to the "Manchester Guardian," the "News-Chronicle" and one or two others. [HON. MEMBERS: "Oh."] Those are two leading newspapers representative of Liberal feeling, which is very much bigger in the country than the Liberal party in this House. I quote from the "Manchester Guardian," in which it is stated that while the Prime Minister lunched with Herr Ribbentrop on Friday and had a long conversation with him, when the French Ambassador tried to see him on Saturday he was not able to see the Premier or Lord Halifax and that both the French and the Czechoslovakian Ministers only saw permanent officials.
  The Under-Secretary of State for Foreign Affairs (Mr. Butler): The French Ambassador did see my Noble Friend the Foreign Secretary on Saturday at the Foreign Office.
  An Hon. Member: Tell that to the "Manchester Guardian."
  Miss Wilkinson: I am very glad to know that that is so.
  The Prime Minister: As far as I am concerned, he did not ask to see me.
  Miss Wilkinson: This is a democratic House and one of the important duties to be performed in a democratic assembly of this kind is to bring such statements before it in order to see whether they are denied or accepted. I wish to make it perfectly clear that I did not make any accusation against the Prime Minister. I quoted two responsible newspapers and asked whether the statement was accepted or not.
  Viscountess Astor: Irresponsible.
  Miss Wilkinson: The Noble Lady, whose husband owns the "Times" and the "Observer," need not talk about that.
  Viscountess Astor: Not the "Times."
  Miss Wilkinson: I think this Debate has made clear what is really the central point of the situation. We may argue on this side or on the other side about the League of Nations, about how we are to deal with Czechoslovakia and about how we propose to deal with events which may arise weeks ahead. But there are certain problems which must be dealt with immediately. They will not wait. One thing on which we must press for an answer from the Prime Minister is whether the events of this week-end have made any difference to his general views and that of his Government with regard to the Non-intervention Committee.
  I consider that the whole proceedings of this House with regard to the Nonintervention Committee have been an encouragement to Herr Hitler and Signor Mussolini. They are both extremely acute gentlemen and they must have realised that, if they could bluff the British House of Commons in the open and crude way in which they have bluffed the Non-intervention Committee, it was an encouragement to them to do almost anything. The right hon. Gentleman the Member for Sparkbrook spoke passionately of defending liberty with blood, and seemed, in some way, to blame us here because this little country of 6,500,000 people did not fight. I would remind the right hon. Gentleman that there is one small country which has fought, and which has shed its blood. It has stood up to Germany and Italy; it has stood up to a subsidised civil war and a terrific barrage of propaganda; it has stood up to the fact that this country organised 29 nations to refuse its legal right to buy arms. I would like to see the right hon. Gentleman giving more assistance to that little country which has carried out, with such heroism, the advice given by him to-day.
  I wish to ask the Prime Minister whether he thinks that the farce of the Non-intervention Committee can go on any longer. I was interested in the speech
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  of the hon. and gallant Member for Bournemouth (Sir H. Croft). We all know the line which he has taken with regard to General Franco, and it is interesting to know that he has been forced to realise that the situation is different now from what it was on Friday last. The Prime Minister knows of the tremendous armaments that have been rushed into Spain recently, and which are responsible for the pounding of the earthworks at Teruel, the pounding of the Republican forces in Aragon and the northern sector. We know what human heroism is capable of, but however you may be willing to sacrifice your blood there are limits to what can be done against heavy armaments. Aeroplanes have been rushed in recently, and, as the right hon. Gentleman below the Gangway has reminded us, for the first time now the very latest types of German aeroplanes are now in Spain. These have come in during these conversations. No heroism can stand against force of that kind. If Germany and Italy pour in sufficient war material within the next few weeks how can the Republican Government stand?
  The right hon. Gentleman below the Gangway, who, rightly or wrongly, regards General Franco as a gentleman, seems to think that when Italy and Germany have won for General Franco—if they do win for him, and even yet, I cannot believe that they will—then General Franco as a proud Spaniard will politely request Germany and Italy to withdraw their troops and leave him undisturbed. Surely that is just politics for infants. I do not suggest that I regard the right hon. Gentleman as an infant politically, though there is something rather boyish about him, but such a suggestion is grotesque. I am sure the Prime Minister himself does not think that that is likely to happen. He knows that if the German and Italian troops put General Franco on a rickety throne, they will remain in Spain. Nobody imagines that Herr Hitler and Signor Mussolini have spent such enormous sums in order merely to say, "Good-bye" to General Franco when they have won. However proud a Spaniard General Franco may be, if he cannot beat the Republican troops whose arms he has taken, how is he going to turn out Germany and Italy with all their armaments? The Prime Minister knows that that is impossible.

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  I put this question to the Prime Minister. When he is considering, as he must, the new situation that has arisen, can he give us some guarantee, first, that there shall be no concession of belligerent rights of General Franco, which would mean, in effect, giving the right of blockade at sea not to General Franco but to Germany and Italy? Secondly, can we have an understanding that there shall be no suggestion of the closing of the French frontier to arms which it is the legitimate right of the Spanish Government to buy? Can we also have some sort of understanding that, at last, we shall get to reality in regard to Spain; and that whatever class issues may have been involved, we shall now say that the interests of this country and the interests of democracy rise above the class interests of certain people in this country, and we are determined that a stand shall be made where we can make it. Before long we may be too late. At least let us make a stand to preserve this small country which, in the language of the right hon. Gentleman opposite, has defended its liberty with its blood.
  6.26 p.m.
  Mr. Churchill: There were a good many things in the speech of the hon. Lady the Member for Jarrow (Miss Wilkinson) with which I felt myself in much more cordial agreement than some of my neighbours did. There were other things in her speech with which I found myself much less in agreement. But I do not propose to trench upon any of the controversial or party or recriminatory grounds which enter into many people's minds, and which might well be exploited upon suitable occasions but seem inappropriate to the grave circumstances in which this Debate is held. The speech of the Prime Minister overshadowed the Debate and dominates all our minds. I do not know when in my lengthening experience of the House of Commons I have heard—certainly not since the War—a statement so momentous, expressed in language of rigid restraint but giving the feeling of iron determination behind it.
  We are to have a further Government statement both on Defence and foreign policy, and for that very reason it is difficult for us to carry the Debate this evening into very close quarters with the great subject involved. But I should like to say, welcoming some of the statements
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  which the Prime Minister made, that I am sure in all quarters of the House we heard with the greatest pleasure his affirmation of the rights and interest and duty of Great Britain in Central Europe. He has said that there must be no hasty decision, and everybody will feel that while our minds are under the immediate influence of this painful and lamentable event is not the best time to take fresh resolves, provided that nothing is lost by delay. But there would be great danger if there were prolonged delay.
  I listened with great pleasure to the speech of my right hon. Friend the Member for Sparkbrook (Mr. Amery). I found myself very ready to respond to the appeal which he made that we should pool our opinions and efface differences as far as possible. Above all, I agree with him in his statement that the policy to be declared, within a reasonably short time, by this country must be clear and precise, so that it can be understood, for good or ill, by all countries and all parties. Everyone remembers the controversy, which has draggled on for many years, about whether we could have stopped the Great War in 1914 if Sir Edward Grey had made plain declarations a week beforehand. I myself am of opinion that he did all that it was possible for him to do in the circumstances, and I doubt very much whether that event would have been averted even if he had made such a declaration. But still there is a weight of historic judgment piling up that in all these matters of international strife and danger it is most necessary that nations should declare plainly where they stand, and of all the nations which should declare plainly where they stand, our country, with her insular characteristics, still partially remaining to her, has an obligation to give a perfectly plain statement of what she will or will not do in certain contingencies when those contingencies approach the threshold of reality.
  Long delay would be harmful. Why should we assume that time is on our side? I know of nothing to convince me that if the evil forces now at work are suffered to feed upon their successes and upon their victims, our task will be easier when finally we are all united. Not only do we need a clear declaration of the Government's policy, but we require to get to work to rally the whole country behind that declared policy, in order that there shall not be shifts and changes, as

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  well as that there shall not be any doubt or hesitation. It will certainly be no easier for us to face the problems with which we are confronted a year hence than it is to-day. Indeed, we might easily delay resistance to a point where continued resistance and true collective security would have become impossible.
  The gravity of the event of 11th March cannot be exaggerated. Europe is confronted with a programme of aggression, nicely calculated and timed, unfolding stage by stage, and there is only one choice open, not only to us, but to other countries who are unfortunately concerned—either to submit, like Austria, or else to take effective measures while time remains to ward off the danger and, if it cannot be warded off, to cope with it. Resistance will be hard, yet I am persuaded—and the Prime Minister's speech confirms me—that it is to this conclusion of resistance to overweening encroachment that His Majesty's Government will come, and the House of Commons will certainly sustain them in playing a part, a great part, in the effort to preserve the peace of Europe and, if it cannot be pre-served, to preserve the freedom of the nations of Europe. If we were to delay, if we were to go on waiting upon events for a considerable period of time, how much should we throw away of resources which are now available for our security and for the maintenance of peace? How many friends would be alienated, how many potential allies should we see go, one by one, down the grisly gulf, how many times will bluff succeed, until behind bluff ever gathering forces have accumulated reality?
  Where are we going to be two years hence, for instance, when the German Army will certainly be much larger than the French Army, and when all the small nations will have fled from Geneva to pay homage to the ever waxing power of the Nazi system, and to make the best terms that they can for themselves? We cannot leave the Austrian question where it is. We await the further statement of the Government, but it is quite clear that we cannot accept as a final solution of the problem of Central Europe the event which occurred on 11th March. The public mind has been concentrated upon the moral and sentimental aspects of the Nazi conquest of Austria, a small country brutally struck down, its Government
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  scattered to the winds, the oppression of the Nazi party doctrine imposed upon a Catholic population and upon the working classes of Austria and of Vienna, the hard ill-usage of persecution which indeed will ensue, which is probably in progress at the moment, of those who, this time last week, were exercising their undoubted political rights, discharging their duties faithfully to their own country. All this we see very clearly, but there are some things which I have not noticed have been brought out in the public Press and which do not seem to be present in the public mind, and they are practical considerations of the utmost significance.
  Vienna is the centre of all the communications of all the countries which formed the old Austro-Hungarian Empire, and of all the countries lying to the South-East of Europe. A long stretch of the Danube is now in German hands. This mastery of Vienna gives to Nazi Germany military and economic control of the whole of the communications of South-Eastern Europe, by road, by river, and by rail. What is the effect of this upon the structure of Europe? What is the effect of it upon what is called the balance of power, such as it is, upon what is called the Little Entente? I must say a word about this group of Powers called the Little Entente. Taken singly, the three countries of the Little Entente may be called Powers of the second rank, but they are very powerful and vigorous States, and united they are a great Power. They have hitherto been, and are still, united by the closest military agreement. Together they make the complement of a great Power and of the military machinery of a great Power. Rumania has the oil, Yugoslavia has the minerals and raw materials. Both have large armies, both are mainly supplied with munitions from Czechoslovakia. To English ears, the name of Czechoslovakia sounds outlandish. No doubt they are only a small democratic State, no doubt they have an army only two or three times as large as ours, no doubt they have a munitions supply only three times as great as that of Italy, but still they are a virile people, they have their rights, they have their treaty rights, they have a fine of fortresses, and they have a strongly manifested will to live, a will to live freely.

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  Czechoslovakia is at this moment isolated, both in the economic and in the military sense. Her trade outlet through Hamburg, which is based upon the Peace Treaty, can, of course, be closed at any moment. Now her communications by rail and river to the South, and after the South to the South-East, are liable to be severed at any moment. Her trade may be subjected to tolls of a destructive character, of an absolutely strangling character. Here is a country which was once the greatest manufacturing area in the old Austro-Hungarian Empire. It is now cut off, or may be cut off at once, unless out of these discussions which must follow arrangements are made securing the communications of Czechoslovakia. She may be cut off at once from the sources of her raw material in Yugoslavia and from the natural markets which she has established there. The economic life of this small State may be very largely strangled as a result of the act of violence which was perpetrated last Friday night. A wedge has been driven into the heart of what is called the Little Entente, this group of countries which have as much right to live in Europe unmolested as any of us have the right to live unmolested in our native land.
  It would be too complicated to pursue the economic, military, and material reactions, apart from moral sentiments altogether, into the other countries. It would take too long, and I would not trespass so long upon the House, but the effects upon Rumania, upon Hungary, upon Bulgaria, upon Turkey, of what has happened now, must be the subject of the closest possible study, not only by His Majesty's Government, but by all who aspire to take part in the public discussion of these matters. By what has happened, it is not too much to say that Nazi Germany, in its present mood, if matters are left as they are, is in a position to dominate the whole of South-East Europe. Over an area inhabited perhaps by 200,000,000 of people, Nazidom and all that it involves is moving on to absolute control. Therefore, I venture to submit to the House that this Nazi conquest of Austria cannot remain where it is, and that a patient, determined, persevering discussion of it ought to take place and to be pushed forward, first of all, no doubt, through the Chancelleries and by the diplomatic channels, but also and ultimately it should be
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  pushed forward in the natural place for such discussions to take place—under the League of Nations at Geneva.
  I wanted to make this point—it is the only point of detail that I shall venture to make—that we are not in a position to say to-night, "The past is the past." We cannot say, "The past is the past" without surrendering the future. Therefore, we await further statements from His Majesty's Government with the greatest possible interest. The serious nature of our affairs is realised and apprehended in all parts of the House. I have often been called an alarmist in the past, yet I would venture to affirm to-night that there is still, in my belief, an honourable path to safety and, I hope, a path to peace. What ought we to do? The Prime Minister to-day has made a momentous declaration upon the subject of Defence. There is to be a new effort of national rearmament and national service. We shall have to lay aside our easy habits and methods. We shall have to concentrate on securing our safety with something like the intensity that has been practised in other countries whose excesses we may desire to restrain. I think the House will be grateful to the Prime Minister for that declaration, and I am certain that he may rely upon all those strong forces in every party throughout the country to second the efforts of the Government to place us in a position where we shall not feel ourselves liable to be blackmailed out of our duties, out of our interests, and out of our rights.
  It seems to me quite clear that we cannot possibly confine ourselves only to a renewed effort at rearmament. I know that some of my hon. Friends on this side of the House will laugh when I offer them this advice. I say, "Laugh, but listen." I affirm that the Government should express in the strongest terms our adherence to the Covenant of the League of Nations and our resolve to procure by international action the reign of law of Europe. I agree entirely with what has been said by the Leaders of the two Opposition parties upon that subject; and I was extremely glad to notice that at the beginning and the very forefront of his speech the Prime Minister referred to the League of Nations and made that one of the bases of our right to intervene and to be consulted upon affairs in Central Europe. The matter has an importance in this country. There must be a moral basis

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  for British rearmament and British foreign policy. We must have that basis if we are to unite and inspire our people and procure their whole-hearted action, and if we are to stir the English-speaking peoples throughout the world. Our affairs have come to such a pass that there is no escape without running risks.
  On every ground of prudence as well as of duty, I urge His Majesty's Government to proclaim a renewed, revivified, unflinching adherence to the Covenant of the League of Nations. My hon. Friend the Member for East Aberdeen (Mr. Boothby) in his speech jeered at the expression "collective security." What is there ridiculous about collective security? The only thing that is ridiculous about it is that we have not got it. Let us see whether we cannot do something to procure a strong element of collective security for ourselves and for others. My hon. Friend, while mocking at collective security urged us to take what I should have thought was a strong and definite step towards it. He urged us to make common cause in self-defence with the French Republic. What is that but the beginning of collective security? I agree with that. Not so lightly will the two great Liberal democracies of the West be challenged, and not so easily, if challenged, will they be subjugated. That is the beginning of collective security. But why stop there? Why be edged and pushed further down the slope in a disorderly expostulating crowd of embarrassed States? Why not make a stand while there is still a good company of united, very powerful countries that share our dangers and aspirations? Why should we delay until we are confronted with a general landslide of those small countries passing over, because they have no other choice, to the overwhelming power of the Nazi regime?
  If a number of States were assembled around Great Britain and France in a solemn treaty for mutual defence against aggression; if they had their forces marshalled in what you may call a grand alliance; if they had their staff arrangements concerted; if all this rested, as it can honourably rest, upon the Covenant of the League of Nations, agreeable with all the purposes and ideals of the League of Nations; if that were sustained, as it would be, by the moral sense of the world; and if it were done in the year
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  1938—and, believe me, it may be the last chance there will be for doing it—then I say that you might even now arrest this approaching war. Then perhaps the curse which overhangs Europe would pass away. Then perhaps the ferocious passions which now grip a great people would turn inwards and not outwards in an internal rather than an external explosion, and mankind would be spared the deadly ordeal towards which we have been sagging and sliding month by month. I have ventured to indicate a positive conception, a practical and realistic conception, and one which I am convinced will unite all the forces of this country without whose help your armies cannot be filled or munitions made. Before we cast away this hope, this cause and this plan, which I do not at all disguise has an element of risk, let those who wish to reject it ponder well and earnestly upon what will happen to us if, when all else has been thrown to the wolves, we are left to face our fate alone.
  6.54 p.m.
  Mr. Bellenger: Whatever I have to say will be overshadowd by the powerful speech which has just been made by the right hon. Gentleman the Member for Epping (Mr. Churchill), but I deem it my duty at this serious time in our affairs to place on record my views while there is yet time to put them. This is not a time for abstract ideas. We are in the presence of concrete realities—I might almost say reinforced concrete. Therefore, I will, however much I may be tempted to reply to some of the speeches that have been made by hon. Gentlemen opposite in partisan fashion, deal only with the main subject of this Debate, namely, the speech of the right hon. Gentleman the Prime Minister. He has given us a realistic view of the events which have taken place. I submit that the hour is too late for us to trouble ourselves overmuch as to how those events occurred. We are concerned to-day with events as they are, and with the right hon. Gentleman's explanation of how he proposes to deal with the future.
  I endorse the remarks made by the right hon. Gentleman the Leader of the Liberal party and re-echoed by the right hon. Gentleman the Member for Epping, that not only is it necessary for the Government to state their views to this House, but it is also necessary in their own interests, if they want that co-operation

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  which they are about to seek, to state those views to the country, for it should not be forgotten that, however powerful the Government's majority in the House is at the moment, the Opposition represents nearly 10,000,000 votes. On those electors the Government will need to depend for their future policy, whatever it may be. The right hon. Gentleman the Member for Sparkbrook (Mr. Amery) has thrown out an idea with which I do not propose to concern myself at the moment, except to say, in answer to the views he expressed about co-operation by the powerful party—because it is a powerful party—which we represent, that we must be clear in our minds where the Government, whatever might be its complexion in future, is going to lead us. I, therefore, welcome the clearly expressed views of the right hon. Gentleman the Member for Epping.
  I can support rearmament in its entirety and I can also advise my constituents, so far as my advice is of any use, to support any Government in facing this terror provided we face it on the correct terms, terms which have been advocated from these benches very often—too often perhaps for some hon. Members on the Government Benches. I desire to follow the lead which has been given to the House and to his supporters by my right hon. Friend the Leader of the Opposition. I think the House will agree that he has stated his views and the views of his party in a very restrained manner, and it behoves every hon. Member to follow the example which he has set. The indications of Germany are clear and definite. Her leaders have expressed them so often that I wonder sometimes that the Government have not paid attention to the lucidity with which they have expressed them. Yesterday, when I listened to Field-Marshal Goering making his statement on a day of remembrance to the dead in Germany, I was struck with the gloating manner in which he made what I can only consider to be a war speech. He showed clearly to all the nations of the world—whether we agree or disagree with his views makes no difference—the direction which Germany proposes to take. In view of those clearly expressed views it would be cowardly for anybody in this House not to state his opinion, which must be the opinion so clearly expressed by the right hon. Gentleman the Member for Epping.
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  I do not wish to take part in this discussion for too long, for I realise that in circumstances such as this it is difficult for any hon. Member to collect his views in a cool, calm and dispassionate manner. I do not want to utter any words against Germany or Italy or any other country that would only increase the difficulties with which the Government will be faced in the immediate future. I would like to say, however, that the mere fact of Italy's acquiescence in this last move that Germany has made in Austria should surely indicate that the price which has been paid for her silence must be a very big one. We can in our private discussions venture an opinion as to what the price is that Germany has paid for Italy's acquiescence. That price might possibly contain a serious threat to British interests and British lines of communication in the Mediterranean. I have spoken on occasions of appeasement for the German people and I have been pleased to hear hon. Members opposite express the same views to-night. But I realise that it is an utter impossibility at present to consider the question of Mandates and other methods of appeasement in the present circumstances. There will, however, come a time, I believe, when these omnipotent rulers of Germany are overthrown, when we shall have to discuss these matters with the German people under a different Government and a different system. When that time comes, do not let us make the same mistake that we made in 1918 and 1919, when we refused to discuss conditions like that and imposed on the German people an unjust treaty.
  It may be thought that Hitler has the entire German nation behind him. I often wonder. I have numerous German friends and acquaintances, and I should view with grave apprehension any possibility of war between the two nations. I realise that in present conditions we have to take a definite and firm attitude against the rulers of Germany, but I separate the people from the rulers. I firmly believe that, although the rulers have a considerable number of the people behind them—I regret to say too many young people who will be called upon to bear the brunt when the time comes—nevertheless I believe that there is coming into evidence among all classes in Germany a feeling that the Government that they have got is one that is leading them to ends which they cannot foresee and do not desire

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  Therefore, if it is possible for our Government, whatever its complexion may be, to make a clear statement and get it to the German people, backed up with the force that we shall have to have behind these things, I believe it will be possible even at this late hour to make an impression upon, at any rate, considerable numbers of German people.
  As to our future policy, I endorse entirely what has been said on the subject of collective security. There can be no splendid isolation for this country such as is described by a powerful section of the Press. There can be only collective security, and if that seems to hon. Members opposite a strange sort of phrase, I ask them what it is that they are going to call an alliance between this country and France, and France's own military allies? Call it what you will—it makes no difference to me—if only you can gather together some nations, even if only half a dozen, bound together by one common object, the Covenant of the League of Nations, I am prepared to support, and I feel that many of my colleagues will also support that cause to the bitter end. When hon. Members opposite ask us to co-operate with them, they cannot expect us to give them a blank cheque. We are not prepared to do it. If the Government desire the cooperation, as apparently they do, of the masses of the people of the country, they must look to those organisations which represent to a very large extent those masses of people, the Labour party, which is the political expression of many of those masses, and the trade unions.
  7.5 p.m.
  Mr. Granville: I agree with a good deal of what he hon. Member has said, and I agree that after we have recovered from the shock of the events of the last two days, the Government and the House have to turn their attention to the future. I saw something of the conditions that led to the bludgeoning of Dollfuss and to the invasion of Austria. There were many friends of Austria, but, when the time came, there were very few who would fight. It seems to me that in recent years there have been only two things that could have saved Dollfuss or Dr. Schuschnigg, and they were money and allies who would have made her the Belgium of 1938. Many democratic countries were not armed and were not
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  ready to face the European war that would have followed if they had taken that action. If it is true that armed intervention would have led to world war, in my judgment we were right to stay our hands, because this country was not ready. We followed for a long time a policy of disarmament while other countries were busy rearming. We delayed rearming for two years. Italy knew it, Germany knew it, and Japan knew it. We have had it proved to us that you cannot face armed aggressors with speeches. The late Foreign Secretary tried for two years at Geneva, without the cards in his hands, to deal with a situation in which he was facing rapidly rearming aggressors when this country had delayed its rearmament for two years.
  From the speeches that we have heard to-night it is clear that it is a very easy matter to be wrong in foreign affairs. As the Minister of Agriculture said a few weeks ago, foreign affairs are a comparatively simple thing provided you have not to deal with the foreigner. In my view those who delayed rearmament for two years were wrong, and we are having to pay for those two precious years that have been lost, and democracy has, in consequence, had to watch the sufferings of the victims of the aggressors' opportunism. As the right hon. Gentleman the Member for Epping (Mr. Churchill) said, in a speech which gave the House a good deal to think about, and a speech with which I found myself largely in agreement, the National Government and the House have to face the situation as it is to-day. Germany over night, despite all the protests that have been made, has established herself as a menace in Europe. It is believed in Germany to-night that the balance of power in Europe has passed into German hands. I have seen something of the country and something of the Nazis. On many occasions they have tried to explain their policy to me. I have tried in every sense of the word to believe and to understand that the ruling class in Germany are desirous of peace, but I have been convinced for some time that the policy of the German Nazis is not Lithuania, is not Trieste, is not Alsace, and is not Czechoslovakia. I honestly believe that the policy of Nazi Germany has been for some time the domination of Europe. Will the demand for Colonies come soon as a bait, as the price of a ten years' pact of

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  appeasement, or shall we not see a continual state of what amounts to a threat to Czechoslovakia, and possibly to Lithuania? Is the ruler of Germany prepared to state the terms for a Four-Power Pact or a pact of ten years of appeasement?
  The Prime Minister some days ago, in reply to an interruption, said that his policy was to settle the grievances of Europe without resort to war. I believe that the first essential is to obtain national unity. If you get a Four-Power Pact, if you get the old Stresa front plus the cooperation of France, plus British rearmament, in my judgment it is not enough, and you will need the backing of the League of Nations' Powers. The Prime Minister also said he would fight for democracy. I believe that if an honest attempt were made to settle grievances in Europe, and aggression still persisted, the people of this country would fight for democracy against aggression, but I believe they would prefer to do it through the machinery of the League of Nations, because the League of Nations is still a moral force in the world, and what other rallying point have you got to-day if you are to abandon that machinery and try to do it through alliances, balance of power or a Four-Power Pact? In addition, I believe the United States still has an antipathy to balance of power and alliances. I had five years' experience of what a right hon. Gentleman once called "the opening and shutting of doors" in the Foreign Office, and I honestly believe that the people in this country, the people in France, and the other democracies came out of the last War with an idea. That idea has found its expression in the League of Nations, and I hope that at this juncture the Prime Minister will see that that is the best machinery which he can employ if he is going to face up to the immediate and the eventual situation in Europe.
  I believe that our immediate policy should be, first, to try to achieve unity in this country upon foreign policy. I believe that is vital to the situation. Second, I believe that we should take every step to strengthen our armaments, to speed up our armaments programme, and particularly the defensive position of the British Commonwealth of Nations. I should like to hear an announcement from the Prime Minister in the near future that we intended to double the Royal Air Force
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  in this country, and I would even go so far as the creation of a reserve for the Royal Air Force on a basis of voluntary national service. I should like also to see the National Government invite hon. Gentlemen opposite, and others, to cooperate on a policy of national concentration with a defined programme, a defined foreign policy, which could be made clear, which could be made precise and which could be submitted to the people of this country and to the League of Nations. I would call the great trade unions into consultation. I would try to get them to give me their views and their agreement on my immediate and my eventual foreign policy.
  In conclusion, I hope that the Government are going to look at this problem in the broadest sense. I hope that they are going to state what is to be the foreign policy of this country to the people of the country, and that it will be put before them in a way which will be understood in every cottage in the land, so that we may know for what we stand.
  Mr. Dingle Foot: It was not at the last Election.
  Mr. Granville: I am prepared to debate that with the hon. Gentleman on any platform at any time he likes. If there is one thing from which the people of this country and other countries are suffering at this time it is perplexity, arising from the headlines in the newspapers, the stories they read, and even, in some sense, what they hear in debates upon the wireless, and I hope that the Government will state their policy on this situation simply, so that it can be clearly understood by the mass of the people in this country. I hope that we shall proceed with a policy of day and night rearmament. When I heard the right hon. Member for Warwick and Leamington (Mr. Eden) making his speech in this House I could not help remembering—and I had had the opportunity of working with him in a minor capacity—that every time he went to Geneva he went there to advocate disarmament, to advocate collective security, to advocate the rule of international law and peace. Members of this House know that he went there on a policy of disarmament, but the nations who were there were paying only lip-service to it, and returned to their countries and carried on a policy of rearmament with the greatest speed. I want to see us get

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  down to realities. I hope the Government will try to obtain unity in the broadest sense of the word, I hope it will try to rally the people of this country behind its foreign policy, and I believe that if we follow the course which was indicated by the right hon. Member for Epping there is still time to save Europe and, perhaps, the peace of the world.
  7.20 p.m.
  Mr. Mander: I venture to think that Herr Hitler has during the last few days done more for collective security than the League of Nations' Union, greatly as I value that body, throughout the whole of its career. The series of speeches in support of it which we have heard to-day are some of the most remarkable and refreshing that I have heard since I have been in the House. We are facing a very grave situation, but it is an intermediate stage, and all we can do to-day is to express hopes as to the policy which the Prime Minister in due course will lay before this House. I join with what has been said by others in hoping that he will put forward a policy which will obtain the support of the great mass of the people of this country belonging to all parties. I believe that can be done, and I am encouraged to think so by some of the speeches made to-day, not only from this side of the House but, more important, from the other. My right hon. Friend the Member for Sparkbrook (Mr. Amery), my right hon. Friend the Member for Epping (Mr. Churchill), and my hon. Friend the Member for Eye (Mr. Granville) have made very remarkable declarations, and if that is the spirit in which the matter is to be approached, it is by no means impossible that we shall obtain a united front on this vital and supreme question. But I think it is generally recognised that that cannot be done purely on a policy of national rearmament. If that is the beginning and end of the policy there will be nothing but bitterness, strife and disunion from one end of the country to the other, and we shall be impotent in the case of war.
  With reference to Austria, what has just happened has surely been foreseen for a number of years. The independence of Austria was lost in 1933, when she turned to the League and asked for support against the pressure from the Nazis, which was then beginning, and was told by this and other countries in
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  the League that they were not prepared to take any action. Austria had to turn to the only friend she could find, and she turned to Signor Mussolini, and ever since then, really her fate has been sealed. It was no surprise; it was merely a question of the date when it would happen, but it was, none the less, abominable that it should have happened, and that it should have happened in the brutal way it has. The Prime Minister made various statements on which I should like to comment. I do not want to do so in a controversial spirit, for I recognise the mood we are in to-day, but I think one is entitled to make certain comments. He said that we gave no encouragement to Germany to make this attack upon Austria. I am sure that he did not do so intentionally, but I cannot help thinking that some of the words he used in the Debate on 22nd February may have given certain impressions in Berlin. For instance, he said with regard to the League:
  "I would have it clearly understood that the League cannot use them"—
  That is, those powers—
  "and cannot be expected to use them, and that the nations which remain in the League must not be saddled with liabilities or risks which they are not prepared to undertake. Nor must other nations expect that the League will provide that security which it was once hoped it would provide."—[OFFICIAI-REPORT, 22nd February, 1938; col. 228, Vol. 332.]
  I should have thought that deductions might easily be drawn from that which have given distinct encouragement, however unintentional, to the events of the last two days. The Prime Minister also said that we had no commitments of any kind with regard to Austria. Really, is that the case? I cannot help remembering that we are signatories of the Covenant of the League of Nations, and that Article 10 binds us to maintain against aggression the territorial integrity and the existing political independence of all States members of the League. And Austria is a member. However difficult in the circumstances it may have been to take any action, it is untrue to say that we have no commitments with regard to Austria in international law. I would further point out that this is the first crisis in international affairs since the War when no meeting of the League of Nations Council has been summoned. Only three weeks ago, just before the late Foreign Secretary resigned, and when there was

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  anxiety over the Austrian question, it was put to him more than once in this House: "Have you considered the possibility of a special meeting of the Council?" and he indicated that that was not at all ruled out. I very much regret that no such step has apparently been contemplated or taken. It is not yet too late to remedy that.
  The Prime Minister, in the same speech, made reference to the hopes that he entertained of the League of Nations as a body exercising purely moral powers. We have seen something of the value of moral powers in the last few days. It is no use using moral pressure with those who have no morality; who do not believe in moral force at all but only in physical force. The only thing they understand is physical force, and it is with physical force, in overwhelming strength, that the democracies and the free States of the world must surround those who have no use for moral force. The trouble in this country in understanding this question is that the British people, in their tolerant, kindly way, cannot believe that gangsters like the Nazi Government really do exist, that they are what they appear to be. It seems incredible that human beings can have ideas or permit a policy of that kind, but the events of the last few days have done much to bring it home.
  There is one comment, which I hope I may be allowed to make without offence, which I would address to the Government and the Prime Minister. I think there are a good many people in this country who have been a little shocked at some appointments recently made by the Government. I do not say anything about them on personal grounds, because that does not enter into it, but appointments to the Government and in the neighbourhood of the Government, have been of a kind which have been very startling and not calculated to reassure those who may have hoped that a more central national policy was going to be pursued. There are Conservatives, and Conservatives. They have many different points of view. Why go to the extreme Right, at a moment like this, when the late Foreign Secretary has gone, in order to find members for the Government? I hope very much in the plans which the Prime Minister has for the future he will bear in mind the point that I am making. I am sure that it has importance even on the Government side of the House.
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  The policy of more arms alone, as I have said, will never do. We may have to have more arms. If that be so, let us have them. But we want more arms that are not wholly ours. It is necessary to look round and to make arrangements with our friends to co-operate in the use of their arms for the maintenance of law and order in the world. The British Empire alone is completely indefensible. We cannot hope to protect it without the assistance of others, and I think it is generally agreed in this House that we must look round and find others who will come in with us. If we are to look round among the people who are qualified and willing to help us, surely they will be found among the loyal members of the League of Nations. That is what it comes to. We may start off on the basis that we do not like the League, and will not have anything to do with it, and go round to find the countries which can cooperate with us, but we shall find that they are the loyal members of the League of Nations. Really, that pathway leads you back to the collective security of the League of Nations.
  The difficult question which is before us, and which must be answered in a few days, is that of the safety of Czechoslovakia, which is very seriously threatened at the present time. Last week-end, the frontiers of Czechoslovakia towards Germany were almost impregnable. They were very highly fortified, but now one large stretch of the frontier, where the Danube flows down, is not fortified at all. The situation is that German troops could pour over that frontier, and the position is very difficult. It is true that Field-Marshal Goering has given assurances to the Czechoslovakian Government that he does not intend any harm to them or to interfere with them in any way, and I am sure that it is delightful for them to have that assurance. He has also given another assurance. He said in his speech that the German air forces and other forces would be used for the protection of Germans in any other State in the world where they might be found. It is very easy to start a story that Germans are being ill-treated in some country into which you want an excuse for bringing German troops.
  If we give an assurance, as I hope we shall, that we shall stand firm against the aggressor anywhere, and particularly

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  in the case of Czechslovakia and of our great friend, France, it will not be for the sake of Czechoslovakia, but for our own sake. We did not go into the Great War for the sake of Serbia; we went in to protect ourselves. If we are drawn in through the collective system, it will be purely for British interests, but if we make a declaration, firmly and clearly, such as has been asked for to-day on the other side of the House, there is no more certain way of making clear that war will not take place. Even the dictators would not face a wall of overwhelming strength. It has been said: "Where could you get assistance now from other countries? "I will indicate a few countries, most of which, I believe, could still be rallied if we went forward in the spirit that has been urged in this House to-day, namely, of co-operation with us in the collective system. Apart from France, there are Belgium, Holland, Poland, the Little Entente, the Balkan States, Turkey, Russia, the Baltic States, Norway, Sweden and Denmark, as well as the States of the British Empire. In addition to those, we could get the good will and co-operation on their own lines, although not through the League of Nations, of the United States of America. America is pushed into isolation only when she sees Europe confused and muddled. If ever America saw Europe following a clear democratic line of freedom and liberty, I believe she has shown herself willing, in her own way, to come in.
  I believe the time is not too late to obtain that unity. It is said that the League is dead, but the League at present is like a motor car without petrol and without a driver. It is there, and you need only to fill the tank and put your chauffeur there and he can at once drive straight ahead. I hope that the suggestion which was made by the Leader of the Opposition this afternoon that a special meeting of the Assembly should be called to put over this new programme is one which will be very carefully considered. I believe that we can get backing from all parts of the country and all parties for a national policy in foreign affairs. Nothing else matters at the present time. All our schemes of social reform are minor compared with that, but that backing can be obtained only on the lines which have been declared this afternoon. If you want the Opposition political
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  parties and the great trade unions, that is the way to secure their support, and I believe they would go to any length in supporting the right policy. The Prime Minister is showing in his great office that power of drive and initiative which the Prime Minister of this great country ought to show. I only hope that, after the events of the last few days, he will show that drive in a manner which will make him feel that he has behind him the overwhelming mass of the citizens of this country.
  7.36 p.m.
  Admiral of the Fleet Sir Roger Keyes: Last Monday, the right hon. Gentleman the Member for Keighley (Mr. Lees-Smith) and the right hon. Gentleman the Member for Caithness and Sutherland (Sir A. Sinclair) delivered a terrible indictment against the Government's Abyssinian policy, but neither of them said one word about what the Government actually did, or mentioned that they collected the whole British Navy from the Seven Seas in that Eastern part of the Mediterranean and kept that Fleet ready for action, practically under war conditions month after month; ready to carry out any duty which the League of Nations might call upon it to do under Article 16 of the Covenant. No other nation moved a man or a ship and it is simply not fair to place upon Great Britain all the blame for the failure of the League of Nations.
  Mr. Foot: Was it not the British Government which first moved to take off sanctions?
  Sir R. Keyes: What other Government would have agreed to carry out military sanctions? We were in a position to do so, but no other Government moved at all.
  Mr. Foot: No Government had been asked to impose military sanctions. A great many Governments, members of the League, were asked to impose economic sanctions, and loyally did so.
  Sir R. Keyes: They were asked what steps they would take to implement the Covenant, and no steps were taken. My right hon. Friend the Member for Spark-brook (Mr. Amery) suggested that we should not go into the past, and I do not want to do so, but it is well to make sure that the lessons of the last War are not forgotten. People who played a great part in bringing that War to a successful

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  conclusion when it was forced upon us, are forgotten and are sometimes ignored. It is well to remember that at the time of the outbreak of the Great War a Liberal Government was in power, bent on keeping the peace almost at any price, and that that did not prevent war. Fortunately, that Government had in it some statesmen who had the vision to see and, in one case at any rate, the courage to act. Lord Haldane foresaw that the Army would have to be greatly strengthened, and it is to him that we owe the Territorial system which was the foundation of that great Army
  "whose hammer blows made the German Army squeal for an armistice."
  Those words are a literal translation of the tribute paid to the British Army by Marshal Foch in connection with the great offensive which the British Army delivered in the autumn of 1918. The Liberal Government to which I have referred had another statesman who had not only the vision to see but the courage to act. I refer to my right hon. Friend the Member for Epping (Mr. Churchill). He went to the Admiralty and took charge of the Navy in one of the most critical times in the history of British sea power. One could talk for half an hour about the things which he did to make the Navy more efficient, but it is sufficient to say that as the result of his three years' administration, the Navy was infinitely more efficient and ready for war than it was when he took office. When the War broke out, and the country was utterly unready in all other respects, the right hon. Gentleman the Member for Epping and the First Sea Lord, Prince Louis of Battenberg, were responsible for placing the Fleet in a strategic position which gave security to our sea communications while armies and munition factories were being organised. In the last year of the War, after his temporary eclipse and when he was Minister for Munitions, he provided everything that the three Services required to an extent which makes the little efforts of to-day seem dangerous and menacingly tragic.
  Another factor which was of enormous value in August, 1914, was that the Conservative Opposition was loyal and patriotic and did all in its power to support the Government of the day. I do not believe that it is too much to ask the Opposition to show the world that all
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  classes and parties in Great Britain are united in their determination to take all measures necessary, whatever they may cost, to speed up rearmament, in order that we may be in a position to cry a halt to the dictators who are determined to get what they want by war and the threat of war, and to whom treaties, conversations and pacts mean nothing, but which they use to gain time and to disarm opposition until they are ready to strike. I should be glad if the Government had the courage to introduce some form of national service or conscription—and I welcome the indication given in that connection by the Prime Minister—and if the Opposition had the wisdom and patriotism loyally to support the Government. That would let the whole world know that we mean business and are determined to fight against aggression. It would incidentally give potential enemies something to think about. They have not forgotten the lessons of the War.
  The utility of the Royal Air Force and the Army for Imperial defence is dependent upon sea power. The Navy has to carry the other Services on its back in the event of overseas operations. Vast sums are being spent on naval rearmament, and vision and foresight are essential to ensure that we are building the best types of ship and of aircraft to enable the Navy to carry out the great responsibilities which will fall upon it. Could not the Prime Minister now enlist the services of my right hon. Friend the Member for Epping, who has vision, foresight, energy, determination and drive, as well as great knowledge and experience in all matters pertaining to preparations for and prosecution of war? His experience and knowledge are recognised as unrivalled. If he were to lend a hand in the great rearmament with which we are faced and upon which the country are determined, it would send a wave of relief throughout the country and would encourage those small States to look to us for protection. I am confident that our Prime Minister will take the strong stand which will bring the whole country and the whole of our race to his support. I beg him to trust the country, and I am certain that he will not be disappointed.
  7.45 p.m.
  Mr. Gallacher: We are facing in this country and in Europe the gravest

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  situation since the evil days of 1914, a situation that demands understanding on many questions, only one or two of which I shall be able to touch upon. It is a situation that demands courage, and it is a situation that demands especially the unity of the peace and progressive forces in this country and in Europe. I am very happy to say that I agree entirely with the concluding remarks of the right hon. Gentleman the Member for Epping (Mr. Churchill)—his remarks about collective security. I can say that with the greater sincerity, because he agreed with me when I put forward the same proposition a year ago. But we are faced with the fact that Austria is invaded, is lying under the jack-boot of German militarism. The right hon. Gentleman the Member for Sparkbrook (Mr. Amery) said that the Austrian people were not prepared to fight. The people of Austria were prepared to fight, but they were left entirely without leadership. Resistance will grow; the Catholics, the Socialists, the Communists will gather more and more together and find some means of asserting themselves; but the thing that has to be understood above everything else, if we are to appreciate what has happened, is that the gates into Austria were opened by traitors within Austria itself. The agents of Germany, traitors to their own country, deserted their people and opened the gates to the invasion of Austria.
  But do not be under any illusion, the invasion of Britain has begun. It is no coincidence that three weeks ago Hitler demanded a change in the British Cabinet; he demanded the removal of the late Foreign Secretary, and the late Foreign Secretary was removed. No one can tell me that the Prime Minister lives in a vacuum. Who were the people around the Prime Minister who persuaded him to the course that led to the removal of the late Foreign Secretary at the demand of Germany and Italy? Not only was the late Foreign Secretary removed, but, when it came to the appointment of a new Foreign Secretary, the Prime Minister did not say, "Messrs. Hitler, Goering, and Goebbels, please tell me who you would have in my Cabinet," but if he had spoken out before the world and asked that question, they would have answered with one voice "Lord Halifax." Then the Prime Minister, to make his subservience completely
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  plain and demonstrated, when he has to add another Member to his Government, selects—whom? He selects a man from those benches whose only qualities in this House have been blatant and brutal support for every atrocity committed by the Fascists. It may be that right hon. and hon. Members treat this as something which is coincidental, but let me put this to them. An emissary from Germany comes over last week. He has many friends in this country, he discusses these matters with them, and he conveys to the German Government what the opinions of those many friends are; and the German Government, in putting forward questions for discussion, puts down as a question for discussion German control of the British Press. Is that correct or is it not? I ask the House whether in this country 12 months ago, 10 years ago, 20 years ago, at any time, it would have been possible to mention such a question?
  The invasion of Austria did not start last week. It started with an invasion of emissaries from Nazi Germany, who conducted a Press campaign to interfere in this direction and in that direction. The same thing is going on here. We have in this country, as they had in Austria, a gang of traitors who will sell the country to Germany. If the working-class movement of this country make an advance, they will open the gates to Nazi invasion. We have had traitors in every country. We have had traitors in Soviet Russia. But in Soviet Russia they have been mighty and strong, and have cut the cancer out by the roots and destroyed it. It has been growing for a long time. It is very important that Members should understand the might and the power and the strength of the Soviet Union. It is very important that they should understand what has been happening, because we have all sorts of people who do not know anything about the Soviet Union. Hon. Members below the Gangway say they supported the Russian Revolution of 1917. Yes the February Revolution, but not the Bolshevist Revolution. The leaders of the I.L.P. —Ramsay MacDonald, Philip Snowden, Brailsford, all their leading spokesmen—
  Mr. Stephen: You did not.
  Mr. Gallacher: The I.L.P. was against the Bolshevist Revolution. We are told in the Press—the "Daily Mail," the

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  "Times" and all those great organs of "revolutions"—how concerned they are about the "Old Bolshevists" who are being done to death. On the 31st October, 1917, seven days before the Bolshevists took power, Lenin wrote a letter to the Central Committee of the party in which he said:
  "I have not had an opportunity of getting this morning's paper, but the message I received on the telephone about Zinovieff and Kamenev's crime is so monstrous that I simply could not believe it."
  He went on to say:
  "It would be a crime if I remained silent because of my past associations with these men. These men are no longer comrades and I will demand and fight for their expulsion from the party."
  Seven days later the Bolshevists took power, and these two gentlemen came crawling back, confessed all their crimes against the party, bared their souls, and the working-class movement—
  Mr. Stephen: Was not Stalin the editor of the paper in which they issued the statement?
  Mr. Gallacher: No. This is an indication of the utter stupidity of those who try to criticise the Russian Revolution. Stalin was a leader on the central committee, and they went into the Menshevist Press with a statement against the party.
  Mr. Stephen: If you read the appendix to Trotsky's book on the Russian Revolution, you will find that what I said was true.
  Mr. Gallacher: What you said is not true; you simply do not know what you are talking about. The working-class movement, however, is very tolerant, and these two men were admitted into the party again. If you read the Press of that time you will see that everybody claimed that the Bolshevists could not hold power for more than a week. After two weeks they were faced with terrible difficulty. Two weeks after the Revolution, Lenin wrote an article to the "Pravda" in the course of which he said that Zinovieff, Kameneff, Nogin, Rykov and the others had resigned because they were incapable of facing the tasks that were before them. These are the men who are presented as the right-hand men of Lenin during the Revolution. If any one cares to read the history of the Revolution, he will find that in 1918—
  Mr. Speaker: The Debate on the Vote on Account is very wide, but there must be some connection between the hon. Member's argument and what is the responsibility of the Government. I hardly see how the arguments which the hon. Member is now using are relevant.
  Mr. Gallacher: I was trying to show that there were traitors in Austria who opened the gates, and that there are traitors in this country who will be prepared to open the gates. I was trying to show that this country has not only a strong ally in France, but a strong and mighty ally in the Soviet Union, which has succeeded in rooting out the traitors and destroying them. I could, of course, follow along the whole course of the Revolution and show that these same men opposed every advance that was being made, but I will leave that question with the observation that it is a most fortunate thing, not only for the people of Russia but for the people of this country, that that rotten cancer has been cut out, has been exposed before the world, and has been destroyed. I do not know if anyone in this House wishes to associate himself with a bunch of hopeless degenerates, for whom nothing can be said, because, even if they claim that they did not commit the offences they were accused of, they cannot in those circumstances justify the statements they have made. I have many faults, I have made many mistakes, but I have never associated myself with the enemies of the working class, against any section of the working class. I happened to have a talk in the Lobby the other day with a representative of one of the Departments, who asked me a question about some matter which had been raised by his Department and which was of some moment to myself, and the hon. Member for Camlachie (Mr. Stephen), who spends most of his time fraternising with the Tories, thought it was an offence.
  Mr. Stephen: I do not fraternise with them half as much as you do.
  Mr. Gallacher: The only case was with a young Under-Secretary.
  Mr. Stephen: What about the hon. Member for Perth and Kinross (Duchess of Atholl)?
  Mr. Speaker: Perhaps the hon. Member will come back to the subject of the Debate.
  Mr. Gallacher: I will come again to the question before the House. What is the answer of the Government? It is that we should have more arms. I remember one occasion when the right hon. Member for Epping spoke of the great hammers, pounding, pounding, pounding night and day in Germany, and said that it was a menace to the world; but the only remedy he could suggest was that we should start the hammers pounding, pounding, pounding here, and, after they had pounded long enough, they would perhaps drown the sound of the pounding there. But the piling up of armaments is not going to provide any solution. Conscription is not. [An HON. MEMBER: "What have they done in Russia?"] Russia has her frontiers to defend, and she has experience of invasion by the great capitalist countries; but Russia understands, and we ought to understand, that armaments are not going to solve the problems that confront us. We have got to ensure the coming together of the peace forces throughout Europe. I would rather a thousand times associate with the hon. Member for Perth and Kinross in her fight for peace than with someone who claims to be a Socialist and is simply a handrag of the Fascists and the Fascist Press.
  Last night I was speaking at great demonstrations in St. Andrew's Hall and the City Hall in Glasgow. Both halls were packed to capacity, and there was a great overflow meeting outside of each. I could feel there, as I have felt going about during the week-end, that the people of this country are shocked. They do not trust the Government. They feel that there is a situation that demands something very definite and clear. I want to appeal, not to the Government, but to this side of the House, to the Labour party. If they are prepared to take the situation in hand and to go to the country and to break through the rules and regulations that are constantly used to hamstring the movement, let them go out to the people and call upon them to rise in their might and put an end to the Government that has steadily destroyed the League of Nations and brought about the unspeakable situation that now exists in Europe; and to put in their place a people's Government. Let the Labour party understand clearly the situation which exists, and what is needed for it, and I am positive that they can get the masses of the people of this country to rally to their
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  cause, and to put an end to the intolerable situation which exists, and to the Fascist gang which sits on the other side and which will betray this country when it thinks its profits are at stake. Let the Labour party go fearlessly out among the people of this country; and in a very short time we can get a Government which, with the Governments of France, Soviet Russia and Czechoslovakia, can build up a peace encirclement of the aggressor States which will change the whole face of Europe.
  8.8 p.m.
  Duchess of Atholl: I would like, in the first place, to support the plea, made by the Leader of the Opposition to the Government, to do what they can to intercede with the Austrian Government for the many loyal Austrians who, I fear, are now in prisons or concentration camps. It may not be easy to make such representations, but I hope the Government will take whatever action is open to them. I would like also to support the plea made by my right hon. Friend the Member for Epping (Mr. Churchill) for an early declaration of the policy of His Majesty's Government. I would like to support the plea which has been made, that we should endeavour not to regard as something that is established, as a fait accompli, this act of aggression, because union has been made between Austria and Germany. I hope that the Government will consider most earnestly what steps should be taken to avoid associating themselves with the terrible crime that has been committed by the German Government. Then, I would urge the great danger that there is of acts of aggression of this kind spreading speedily in South-Eastern Europe, unless some firm and clear line is taken by the Government of this country.
  I believe that the only way to avoid the spread of aggression, which might well mean before long that Germany was in control of a great part of South-Eastern Europe, is for this country to declare, with others, that if any such policy is carried out, and any further act of unprovoked aggression committed on any country, this country will stand with other peace-loving nations in opposition to such a policy. I believe that we should have the unhesitating support of France and Soviet Russia, and I believe that a firm stand by these three countries, with their great resources, would rally to a

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  policy of collective defence a great part of Europe: such a great part as would make even a powerful dictator think very hard before he struck again. I think that the terrible crime which has been committed in the last few days must arouse great fears in South-Eastern Europe, and make some of those countries even more ready than they were to realise how they themselves stand. A journey that I made in that part of Europe a year ago convinced me how great the influence of our country was there, and how much the attitude of the countries there towards the League and collective action might depend upon the attitude of our own country. I cannot help feeling how much more this is the case to-day.
  I would say to my hon. Friends who have been querying whether other countries would be ready to stand by us, and have quoted in support of their doubt that during the Abyssinian crisis, "not a man, a ship or a gun" was moved other than by us, that that statement was made by the present Home Secretary at the time of his resignation. It was subsequent to his declaration, as I understand, that inquiries were made among other countries as to whether they would support us in military sanctions, and there was obtained from the Powers that were queried—Mediterranean countries—a favourable reply. If my hon. Friends quote the statement, "not a man, a ship or a gun," they are confusing the sequence of events. I cannot say what those promises were worth; but a great deal of water has flowed under the bridges since that date—December, 1935—and since then all those countries have been straining their resources to put their defences in a much stronger position.
  I would remind my right hon. Friend the Member for Epping, who expressed doubt as to whether a declaration of that kind, made in 1914, would really have averted war, that there is evidence absolutely incontestable to that effect. I do not think that he is aware of it, from the manner of his reference; but I have been assured, by someone in an indisputable position to give evidence on that subject, that had our Government, before hostilities opened in 1914, made it clear that the Germans would have had to reckon with us if they attacked France, they would not have attacked. I think my right hon. Friend the late Foreign Secretary was of that opinion, because
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  he has referred in much the same terms to the mistake made then, and he has said that the same mistake must not be made again. I believe that the only way that a devastating war can be avoided is by a declaration, made as early as possible, by this country and others that can be rallied to it.
  I would remind this House, and particularly my hon. Friends who have doubts as to whether the system of collective security can be organised, that it is only by collective action that Europe has ever been able to defend her liberties against assaults which have been made on them. Europe has had to defend herself against Powers which sought to take away her liberties at different times, and never have such attacks been defeated by single action on the part of any great Power. It has always depended on a coalition of the countries that could be brought together, making a combined stand. When the last great stand for liberty was made against a would-be dominating Power, the coalition had to extend across the world, from Japan to the United States. It has been the proudest thing in the history of this country, in my opinion, that we have always been the backbone of such coalitions—the backbone of coalition against Louis XIV and against Napoleon for a whole generation. When one Power after another succumbed to Napoleon's military aggression, and for a time perhaps it looked as though the coalition had ceased to exist, it was always indomitable British courage that kept it going and pulled it together again and finally made it triumph over the efforts of the aggressor.
  It is extremely painful to me to hear members of my own party, with whom I am in sympathy with regard to the greater part of our political beliefs ignoring thus the great part which we have played in history, and doubting whether any collective action can be organised. I believe that, as in the past, this country is able more than any other country to rally other countries to the defence of liberty and peace—to the liberty that we all value no less than we all value peace. I would ask the hon. and gallant Gentleman the Member for Bournemouth (Sir H. Croft) to remember that the essence of the League is its collective principle—the principle of collective defence against

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  aggression against anyone. It does not consist of everything that there is in the Covenant. It is obvious that some of the rules of the Covenant, as, for instance, the unanimity rule, are a great impediment at this moment to quick and effective action by the League.
  For that reason I should regard it as more effective if an early declaration could be made by the great League Powers which I have mentioned, and as many other Powers as they could get. It should be a declaration in keeping with the Covenant but something within the Covenant which could be mobilised more speedily than is sometimes possible under the Covenant. We cannot forget that Portugal the other day prevented any effective action being taken on a resolution on which 32 nations were agreed. I see the hon. Member for Derby (Mr. Noel-Baker) looking at me, but I will not stop to argue with him. The great point is collective action, and I do not doubt that many countries would rally to our side and prevent any further crime such as that which has happened in Austria.
  I hear some people say, "Let us have a declaration to stand by Czechoslovakia, if attacked." Most certainly. I think that Czechoslovakia has a special claim on us. She was set up by the Allies and took her independence, so to speak, as a reward for her services on the understanding that her independence would be guaranteed by the League of Nations. We have a special obligation to Czechoslovakia, but do not let us forget that there are other countries beside Czechoslovakia. Hungary stands to-day with her frontier coterminous with Austria, open to the Germany Army if the Dictator chooses to send it there. If Hungary is overrun, as Austria has been, then the plight of Czechoslovakia becomes even more dangerous, and the route will be open towards the oilfields in Rumania, which might be one of the special goals of a dictator seeking to dominate Europe. It would be dangerous for a declaration to be made that named only one country. It must be a declaration on a much wider basis. It should be a basis which covered Europe, so that, if there was the possibility of trouble in Europe, the aggressor would have to reckon with us, and, I believe, the great majority of the countries of Europe.
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  I cannot help asking myself, on what terms has Signor Mussolini raised not a finger to prevent an aggression which constitutes a great threat to his realm? I am afraid that it must be that he has induced his fellow Dictator to send more help to Spain than perhaps he has done in the past. I would emphasise that, in the opinion of a military expert who knows fundamentally more about this subject than I could ever hope to do, the help that Germany has sent to the Spanish insurgents, technical help of the highest value, has been much more effective than the help sent by Signor Mussolini, though the help sent by Mussolini has been more spectacular because it has included large numbers of infantry. It was German aeroplanes and artillery that crushed the Basques, and, as we have already heard this afternoon, there are in Spain to-day the very latest types of German aeroplanes, against which, I understand, the aeroplanes that are being turned out by the Spanish Government's munition factories are finding it very difficult to stand up, in spite of the great gallantry of Spanish airmen. There is German heavy artillery of a much bigger calibre than that of the Spanish Government, and there are German tanks, and, I believe, much German organisation, and all the time Germany is putting her hands deep into Spain's valuable mines.
  It was the increasing armaments of this very formidable character which recently brought about the insurgent recapture of Teruel. And since Teruel has been recaptured, in two days alone there left the Port of Hamburg for insurgent Spain, about a week ago, no fewer than 14 ships, each of not less than 7,000 tons, laden with heavy artillery. The armaments are not yet in the field, but they constitute a great menace to the very gallant forces of the Spanish Republic. I do not think that there has ever been a clearer case than in the Spanish war of the human element being set against a military machine. It seems to me to be the cause of humanity, of very gallant men, who value their liberty above all things, fighting against the terrible and destructive material that modern science has invented and has placed in the hands of rebels against a legal Government. I could say very much more about the gallantry of the men on the Government side, for it seems to me to be terrible that the effect of the non-intervention policy of which

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  we have been very loyal observers should be that these very gallant men, who have come forward in their tens of thousands and hundreds of thousands to fight for a Government which they recognise as the constitutional government of their county, should have never had the arms which their Government were entitled to supply to them. They have been turned down and crushed by the aeroplanes and artillery which Italians and Germans have sent to the insurgents. It is the more tragic because the Spanish airmen have such a wonderful record of prowess. In the last year they have actually brought down three times the number of aeroplanes that the insurgents have brought down, but at the present time they are being simply outclassed by these new German types.
  There have been a great many people who tell us that everybody on the Spanish Government side holds the views which, I understand, are the views of the hon. Gentleman the Member for West Fife (Mr. Gallacher). I think that in foreign affairs, and in what he has said just now about the effort needed in this country and in all countries in standing together for peace. I recognise a great similarity to my own views. Whatever the Government side represent—there are many Liberals and very few Communists—how can we stand by to-day, in view of this crime in Austria, and see a similar crime perpetrated by the same hands in Spain?
  The inevitable result of an insurgent victory would mean that even if not an inch of Spanish territory is given away, Germany and Italy will have the unrestricted use in war time of Spanish ports and bases, and the opportunity of securing from the Spanish mines the raw materials they need for their arms. Whatever General Franco may say, however fairly he may appear to speak, the man who has called in to help him two dictators who have shown themselves to be such great dangers to the peace of Europe, and the man who allowed German guns to be placed in a position in which they would make Gibraltar harbour untenable and the entrance to the Mediterranean extremely difficult for our ships, can be no friend of this country. It is well that we should remember that he has behind him forces and elements which showed themselves definitely hostile to us in the late War, whereas the Government in Spain have with them people of
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  humbler position who, because they are democrats, were friends of the two great democracies, Britain and France, in the late War.
  Many people think that Signor Mussolini sent troops to Spain because he was afraid of the alleged Communist plot which Franco has given as the reason for his rising. It is of interest and importance to know that there is now indisputable evidence that Signor Mussolini pledged himself to help the Spanish monarchists in a rising to restore the Spanish monarchy in March, 1934, two years before Franco rose. At that time the parties of the Centre and Right had just won a general election and there was only one Communist deputy in the Spanish Cortes. He was the only Communist member out of 470 members of the Cortes, and he was not even elected by the votes of his own party, which was very weak, but simply because of his own popular personality. Therefore, there cannot have been the shadow of a reason to fear that Spain was falling under Bolshevist domination when Mussolini gave a promise to help the Spanish monarchists, and gave substantial grants of arms and money to prepare for the rising which finally took place in July, 1936. I have here a photostat of the interview which the Spanish monarchists had with Signor Mussolini on this occasion in the handwriting of the leading monarchist. This promise from the Duce shows what humbug is this talk about Spain becoming Bolshevist. Perhaps hon. Members may be the more ready to believe that it is humbug, seeing that the same story has been told about Austria. It is told about one after another. In these days anybody who is not ready to listen to Fascism or to be neutral towards Fascism is liable to be dubbed a Communist. A great many people have fallen under that stigma or label. The British people are faced with grave peril because of the threat to our Imperial communications, which will unquestionably be the case if the insurgents win in Spain.
  What has happened in Central Europe clearly points out to us the dangers of dictatorships, and justifies us in imploring the Government to throw over the nonintervention policy, which has shown itself so cruelly one-sided. Neutrality is all very well. Nobody wanted to be involved in war over Spain. Our armaments were at a low ebb when the Spanish

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  civil war began, and the policy of nonintervention was an intelligible one, but, as we have seen; it has not been a policy of simple, normal neutrality, but a policy which, on account of the geographical propinquity of the friends of the insurgents, has played into their hands, with results extremely dangerous to us. No friend of ours would have allowed those guns to be placed in their present position commanding the Straits of Gibraltar.
  I implore the Government in the completely new situation that has arisen in Europe to examine most earnestly and speedily their policy in regard to Spain. Can they honestly say that the policy of non-intervention has succeeded in doing what it was intended to do? If it has not, and if it has inevitably played into the hands of the insurgents, will the Government not have the courage to tear it up and to adopt a policy of normal, honest neutrality? In support of this plea I would ask the Government whether they can really look forward to a feeling of confidence with their representative on the Non-intervention Committee sitting side by side with the representative of a Government that has behaved as the German Government has recently done.
  Finally, I should like to support the plea that has been made from Members of my party on the opposite side of the House for a great national effort that will show that this country realises the great danger of the present situation, and that all will put their shoulders to the wheel. In our experience at the beginning of the late War we saw brave men, drilled, waiting for rifles. They were kept here for long periods and they could not go to the front on account of the lack of arms. I shall never forget my own experience. It was my fortune to be in the depot of a brigade which was the most popular for enlistment in the whole of Scotland at the beginning of the War, and I know how terrible it was to see fine men pouring in their hundreds week after week into the regiment, and then having to wait month after month for arms and uniforms. I remember the excitement there was in one regiment of the brigade when the men could don the bonnet, which was the distinguishing mark of their uniform. Because of the lack of equipment they had to be kept here when their presence was urgently needed at the front.
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  In view of those experiences it is terrible to think that we have not made a greater effort for national training. I do not ask for whole-time conscription, but I think we ought to have a system of part-time training for military service for men of military age. I should also like to see a system by which all women of an age to help and able to give effective service should be called upon to prepare themselves in some way for the great effort that may be required. I would particularly refer to air-raid precautions work. This is work which makes a demand on the people of the country, and particularly the women of the country, infinitely greater than was the case during the late War. I should like to see women trained in first-aid work against gas poisoning, which is likely to be much more widespread than any other form of poisoning from the air that we knew in the late War. If we could have a great effort of that kind we should not only be better prepared if the tragedy of war comes upon us, but it would be a very definite and positive contribution to the preservation of peace. May I say to the hon. Member for Jarrow (Miss Wilkinson) who talked about the conscription of wealth, that taxation is a form of conscription but we realise that as the cost of armaments go on mounting up those who are better off will have to pay for it. I do not think she will find that we are afraid to pay or that we have any intention of running away from the burden which these armaments will put upon the country. It is a case of all being ready to help in whatever way they can, and I am sure she will be one of the first to feel how much the women of this country can do if they are called upon to train themselves for some work. I am sure we shall be able to count upon her help and that of her friends, and that they will be willing to place their services at the disposal of the country in a time of danger.
  8.36 p.m.
  Mr. Ede: I do not think the Noble Lady will expect the hon. Member for Jarrow (Miss Wilkinson) to be satisfied with what she has said about the conscription of wealth. After all in conscripting men you take their lives, you take their all, and that is a very different sacrifice to saying that if war comes you are quite prepared to increase the taxation of wealth. The

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  demand for the conscription of men comes before war comes; whereas the conscription of wealth is not to come until war has arrived. I am sure that in any future war no such doctrine will be allowed to pass muster by the people of this country. It is really astonishing this afternoon, after the atmosphere of only three weeks ago, to hear hon. Member after hon. Member on the Conservative side appealing to hon. Members of the Labour party to give their help and form a national front to deal with a situation which we then prophesied would be the inevitable result of the steps they were then defending. I can well understand their indignation with Herr Hitler. He is not a gentleman. He does not give them time to get away with the story they then told the House. Before the words of the Prime Minister have ceased re-echoing round the House he has shown the contempt which he feels for this Government and for the country which is represented by the Government.
  Never in the history of Parliamentary government has a document addressed to this country been read out to this House in the terms of the message that the German office was drafting for presentation to this country at the very moment when the Prime Minister was entertaining the German Foreign Minister in London. Let us put ourselves in the opposite position. We could never have drafted so contemptuous a document unless Germany had suggested that we should hand over Canada to her. I cannot think of any other demand on the part of Germany which would have justified us in using to her (he terms read out to the House this afternoon. It was evident from the gasp which came from Government supporters that they realised at last the plight to which the policy they have been pursuing has brought this country in the eyes of the world and in the eyes of the dictator countries. The Leader of the Opposition three weeks ago said that any day Herr Hitler might be on the Brenner. Within three weeks that prophesy has been fulfilled. What is the use of your private advances to Signor Mussolini when Herr Hitler stands on the Brenner and can send his tanks and his guns into the Italian plains if he thinks that Signor Mussolini is going to doublecross him. The game of trying to split the two dictators has been spoilt by this move of last Friday
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  and we are faced to-day once again with a fait accompli.
  This is not merely the defeat of Austria. I have no great sympathy with Dr. Schuschnigg. The hon. and gallant Member for Nuneaton (Lieut.-Commander Fletcher) and I spent a month in Austria last year. The late Austrian Government is nothing to weep over. It was a dictatorship. I can well understand why Conservative Members feel that they would like a little Socialist support. The crime of Dr. Dolfuss and Dr. Schuschnigg was that they destroyed the Socialist party of Austria, and when the time of crisis came there was no body of feeling in the country which regarded them as a popular Government. I deplore this march into Austria, but I am not weeping over the dead body of Dr. Schuschnigg's Government. The fate of Austria was sealed in the days when the Social Democratic party of Vienna, which had carried through one of the most remarkable Socialist experiments in the history of the post-war period in their great housing and educational policy, was destroyed by the Austrian Fatherland Front.
  I think we should have from the Government some statement with regard to what has been the real history of the past few days. There was a most remarkable article in yesterday's "Observer." One can understand that there are means of approach between the German Government and the editorial pen of the "Observer." There was a most circumstantial account of the events of the last few months. It has already been mentioned by the hon. Member for Central Wandsworth (Colonel Nathan). There was a story that Dr. Schuschnigg had managed to secure evidence that there was to be a German rising to be supported by forces of German arms in his country, and he proposed to bring the persons so engaged to book. I want to read to the House a passage dealing with the discovery of the alleged treason in the headquarters of the Austrian Nazi party:
  "The speedy sequel was to be a trial for high treason in which everything would be brought out,—one of the causes celébres in the political annals of Europe. The Austrian Chancellor sent copies of the dossier to Signor Mussolini. Dr. Schuschnigg thought he held all the cards in his hands, and that publicity would be his triumph. He was and remained exultant until the crash. The case was no doubt not merely a drama but a melodrama of reality. But he mistook the

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  underlying realities. Above all, he failed to reckon with Herr Hitler, who did not think of holding cards in his hands. He held 'iron dice' in his hands. He was prepared to cast them rather than accept open discomfiture, as the Austrian Chancellor counted."
  I think we ought to know from the Government, especially in view of the account of the last few days as given by the Prime Minister this afternoon, whether they accept the story that there was a carefully planned military coup being prepared by the German Government irrespective of the question of the plebiscite, which only hastened it. In dealing with these very circumstantial stories in the Press, I can only do as my hon. Friend the Member for Jarrow (Miss Wilkinson) did, and ask the Government for information. I am sure that the country, after getting information of that nature from a newspaper which has so frequently been used as the mouthpiece for Herr Hitler's views in this country, will want to know whether this action was only precipitated—and that it might have occurred in a few weeks' time, irrespective of any other events—by the fact that the plebiscite was decided upon. I would like also to quote parts of the two concluding paragraphs of the same article:
  "Further issues loom in the distance. Much, perhaps everything in the long run, will depend upon the powers of managing and moderating statesmanship that Herr Hitler may now show "—
  Herr Hitler has shown plenty of managing statesmanship since he took power, but I cannot recall any instance which even the editor of the "Observer" would be prepared to call moderating statesmanship that he has shown during that period—
  "after a stroke in the spirit of Frederick and Bismarck, which will always be remembered as one of the decisive acts of all history. Already, as we note, he calls 'a real plebiscite' in place of Dr. Schuschnigg's rushed and one-sided plebiscite. We hope earnestly and gravely "—
  I ask the House to pay attention to this, as it shows what was the hope, as late as Saturday afternoon, when the article was written, of those people who have been the most ardent supporters of Herr Hitler in this country—
  "that this sequel will secure a federal union between 'the two Germanic States,' with identity of foreign and military policy no doubt; with closer economic arrangements as a matter of course, but with self-government and freedom for Austria in all internal affairs, civil and religious."
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  That was written on Saturday at the latest, and published on Sunday. To-night we read that in this great Catholic country—probably the most Catholic country left in the world—there is blazoned across Vienna, "In Hitler alone is salvation." When one thinks of the history of Hitlerism in relation to civil and religious liberties, and of the sort of people who inhabit Austria—those kindly, gracious people, the friendliest people I have met in the world—when one thinks that to-night thousands of them are being hurried into hastily-constructed prisons and into concentration camps, one wonders why it was that, when my right hon. and gallant Friend the Member for Newcastle-under-Lyme (Colonel Wedgwood) wanted to remind the people of this country of Milton's poem on the Vaudois, he was censored by the British Broadcasting Corporation. Milton and all that for which he stood is no longer allowed to be proclaimed over the wireless to the people of this country. There was a great phrase of Milton's:
  "He that bids a man reign over him above law, may bid as well a savage beast."
  We have seen this week-end the triumph again of the man who claims to live and rule above international law, and sooner or later we in this country, unless we stand firm, shall find, as all the liberal-feeling people of Austria are finding to-night, that we are under the savage beast. When will the Government have the courage to stand by the liberty-loving tradition of the great mass of the people of this country?
  Colonel Ropner rose—
  Mr. Ede: I never imagined that the hon. and gallant Member for Barkston Ash (Colonel Ropner) was one of the people about whom I was speaking. We have seen Austria go down. Can we afford to see Czechoslovakia go down? We understand, and it has not been denied in the House to-day, that two great military nations—I do not know why we should be afraid to talk about the second—are bound by the most solemn treaty obligations to stand by Czechoslovakia if an act of aggression is committed against her. One does not imagine that they could fail in their obligations, because they must be well aware who would then be the next. If France has to go in, we run the risk of seeing France defeated. Can we run the risk of seeing

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  what we have fought against for 600 years—the Channel ports in the hands of the Powers which control Central Europe? Within the next few days, the Government have to make up their mind what their answer is to the problem which Czechoslovakia now presents. Before 11th March, Czechoslovakia was two moves away; now, apparently, she is the next move. If Czechoslovakia is invaded, France and Russia will have to go to her aid, and in that conflict, if we do not again protect the Northern ports of France, not for her advantage, but for our own, we may very well say, with Pitt, "Roll up the map of Europe." We shall have no more interest in it, except as one of the vassal States. The events of three weeks ago come home to roose to-night. Unless the Government are prepared to take a much bolder line than they have taken hitherto in facing the dictators, we shall find that the last four or five years, since the time when we first began to run away from bullies in Manchuria, will have brought us at last to a cul de sac in which we can no longer run away, but where, all our friends having fallen by the way, we are left at the end of the cul de sac to face the bully alone and to take the thrashing that our own cowardice will have well merited.
  8.54 p.m.
  Lieut.-Colonel Sir A. Lambert Ward: The hon. Member for South Shields (Mr. Ede) stated that in Austria to-night thousands and thousands of people are being driven into hastily-constructed prisons and concentration camps. I should like to know whether he has any justification for making that statement.
  Mr. Ede: I read it on the tape as I came from dinner to the House.
  Sir A. Lambert Ward: Does the hon. Member consider for one moment that everything he sees on the tape is accurate? I am not denying the possibility, but I must say that I was sincerely hoping such a thing would not happen. [Interruption.] I thought I knew as much about Germany and Austria as anybody in the House. I was at a German University, and until the War I spent a great part of my holidays in that country. Since the War, I have visited both Germany and Austria every year. I think I can claim, without boasting, to know as much as anybody in the House
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  about the conditions and what has been going on there during the past 20 years, or, even, I may say, the past 40 years.
  One of the most serious facts which has emerged from this Debate is the lack of any constructive suggestion of how to meet the present tragic state of affairs in Europe. Hon. Members say that we must take a firm line, but no one has the courage to say: "Are you prepared to go to war?" That is the logical consequences which must follow if we are to take up a line such as will bring us into conflict with the Powers of Central Europe at the present time. Very little has been said about the state of affairs in Austria prior to the dénouement which has just taken place. Hon. Members opposite appear to forget that the Government of Austria for the last 10 years has been a dictatorship, on the lines of those in Germany and Italy. I admit that it has been a much milder form of dictatorship, but, at the same time, dictatorship was there. Had anybody asked me three or four years ago, what was the position of the parties in Austria, I would have said at once that they were divided approximately equally into the Socialists, the Patriotic Front and the Nazis. But in the last two or three years the Nazi party has been growing steadily. Why it should have grown, it is difficult to say. Its growth was almost entirely confined to the younger generation. University education in Austria is pretty good, and a large number of the young people go to the universities. The graduates of those universities in arts and engineering and other subjects found that there was no work in their own country and they thought—wrongly, in my opinion—that an alliance with Germany would secure them the employment which they lacked.
  For that reason among others, the power of the Nazi party developed. My friends there, the people with whom I used to stay and the older people generally, would have none of it. But the rising generation took a different view. The younger people would say, "Our fathers will have none of it but we know that the Nazi party is growing." That, no doubt, was partly attributable to the fact that Herr von Schuschnigg—foolishly, in my opinion—dissolved the Heimwehr and these young people, discontented as they were, felt that they had to join

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  some organisation, and the only body left for them to join was the Nazi party. Let us not forget that it is 10 years since a general election was held, and it was becoming obvious that, even had this inroad of the Germans into Austria not taken place, a situation might have developed in which a rising of the Nazi party in Austria would have produced a state of revolution and bloodshed similar to that which we see to-day in Spain. I do not suggest that that justifies this inroad of the Germans into Austria. I do not suggest that it is even an excuse for that inroad, but it is better that we should face the facts as they are and look at everything before we form a judgment.
  Herr Hitler has done what he has done. What is he going to do in the future? What is the future of Czechoslovakia? Some time ago I would not have thought that Czechoslovakia was in any danger of an impression similar to that which has taken place in Austria. To-day I am not so sure. One of the constructive suggestions made this afternoon was that of a definite alliance between the Little Entente, France, Czechoslovakia and ourselves. But let it not be forgotten that should hostilities break out between Czechoslovakia and Germany, a quarter if not one-third of the Czechoslovakian Army would at once desert to the German flag. [HON. MEMBERS: "NO."] Yes they will, and that will be due entirely to the fact that for the last 20 years the Czechs have treated like dogs the German-speaking minority who were placed under them. [HON. MEMBERS: "Withdraw."] I speak with some knowledge of Central Europe, and I go further and say that the German-speaking minority in the Tyrol have been treated like dogs by Mussolini. That is one of the hopes for the future, in my opinion. To-day there are between 600,000 and 800,000 German-speaking people in the Tyrol and Northern Italy who have, as I say, been treated like dogs, and who will be looking from one day to another for assistance from the Germans now stationed on the Brenner. That is one of the difficulties which Signor Mussolini and Herr Hitler will have to face it they want to continue their alliance. This matter must be looked into patiently and carefully, and from every aspect unless we are prepared to go to war. We may easily find ourselves manoeuvred into a position from which
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  there is no withdrawal, and although war may not be the evil thing that many people seem to think it is, in my opinion it is the last argument, and not the first argument, which we ought to use.
  Mr. A. V. Alexander: As this is a very important Debate, may I put this point to the hon. and gallant Gentleman? He has challenged us by saying that we have made no constructive suggestion. He has preached to us as an expert on Czechoslovakia, Germany and Austria. Has he a constructive suggestion to offer?
  Sir A. Lambert Ward: My suggestion was in the concluding words of my speech, that war must be the last and not the first argument to be employed.
  9.4 p.m.
  Mr. Buchanan: I do not speak as an expert on foreign affairs. I frankly admit that I have never been outside this country, but in that respect I resemble the ordinary person in this land who, if war is declared, will have to bear the brunt of it. The great body of the people will embark upon it without ever having been outside this country. I agree that this Debate is the most serious that has taken place in this House, probably since August, 1914. Anyone who listened to the speech of the Prime Minister, whether he agreed or disagreed with it, could not fail to be impressed by the seriousness of the situation. I am not going to recapitulate all the forces which have led to the present situation. Some hon. Members have gone back to the Treaty of Versailles and one might go back still further and say that the last War bred the Treaty of Versailles. The minute you went into war, the minute you conquered the Germans, then of necessity the Versailles Treaty was born. So one could go on about what has led up to the present situation.
  Neither am I going to be dissuaded from my task by the speech of the hon. Member for West Fife (Mr. Gallacher), who thought he might detract us by a form of abuse. May I say frankly to him that we did write a letter the other day, in our capacity as Members of the House of Commons, and I hope we are not doing anything wrong in writing a letter similar in many respects to the letter written by the General Secretary of the Trades Union Congress. Our letter was written in courteous, well-thought-out terms. I am not claiming that we were

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  right or that we were wrong. All that I am claiming is the right to put forward our views to another Government at a particular time. If we were wrong, we are not going to be deterred by the hon. Member's abuse or even filth. I have fought him and his friends in the past, and neither his abuse nor his bullying will deter me from my public duty. We have written a letter, and we have done it honestly. We have received no payment for it, and we will not change our view at the behest of any Government or of any paymaster, whoever he may be.
  To come back to the subject now under discussion, to me it is serious from this other angle, that as I heard the Prime Minister's speech, I saw behind it other issues that are not so plain. There are many things on which most people in this House agree to-day, and let me take some of them. First of all, we most of us agree that Hitler has done this thing in defiance of international law and of every decency of any ruler or any State in the past. Most of us also agree that he has overrun a country which in the past, while I have never visited it, I agree with the hon. Member for South Shields (Mr. Ede) has given much to us in literature, art, music, and the nobler things of life. He has overrun that country in the most brutal fashion.,
  Most of us agree that the last Prime Minister of Austria had not a blameless record in his treatment of the Socialists there. He imprisoned them and cruelly, vindictively treated them. He jailed men without trial. I went over to Transport House only a few days ago and watched decent Austrian women shedding tears in remembrance of their husbands and fathers who had been done to death by this same Austrian Prime Minister, in a manner just as brutal as that of Hitler, and no one can defend him or seek to defend him. Most of us are in agreement there, and we are in further agreement that this action, under normal conditions, not only throws open the gateway of Austria, but brings Czechoslovakia in too, and once that gate is open, heaven knows it might be our turn or somebody else's turn next. With these broad generalities almost every one of us will agree.
  Some hon. Members have said that constructive suggestions should be put forward. It was said by the Leader of the Labour party in, if I may say so, a well-
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  reasoned speech, and although I disagree with some things that he has to say, that is not to say that he is a fool or an ape. If he and I disagree, it only means that we are honestly putting forward our views. He said, in effect, Let us get back to the League of Nations and reorganise it against this organised terror. May I ask those who so easily use that argument to recognise—we are told to be realists—the real forces that we are up against? Is Hitler, who has been called in a newspaper "the thug of Europe," going to wait until you call the League of Nations together to beat him? Is he, with all his power and knowledge, going to wait until you have gathered certain nations together to smash him? I do not know but what to-night he is preparing attacks which we can hardly foresee, and certainly he is not going to wait until the League of Nations or some other assembly meets.
  He is a ruthless, cruel man in his own way, as indeed the leaders of nearly every capitalist State in the past have been, and he is no different, as I see it. I could go on to the ruthless cruelty of Britain in her treatment of subject races in the past. [An HON. MEMBER: "What about Stalin?"] I wish sometimes the hon. Member who shouts about Stalin would write to his friend Franco and urge him to show the same decency that some of us would like to see. There is no doubt that the appointment of the Parliamentary Secretary to the Ministry of Labour was a bribe to Franco. What qualities had that man to be Parliamentary Secretary to the Ministry of Labour, which is an important post, one of the most important posts outside the Cabinet? He had minor qualities for a minor post, though not for that post, but he was held out as a bribe to General Franco abroad.
  It will, however, turn from that matter and say that the late Foreign Secretary must have foreseen the events that have happened, because Hitler has not prepared this in a day. Every point, even to the extent of flags flying, must have been prepared months ahead. You do not move an army in a day or in a week. You must plan, and Britain's Secret Service must have informed our own Government of these preparations. They must have known of them to some extent. Behind all this I see worse. I come from simple folk, who have never seen anything but poverty. I remember the

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  first day of the last War, when it broke out. My predecessor in the House of Commons, George Barnes, went down to the humble place that I come from and said just the same thing about the Kaiser that we are saying to-day about Hitler. He said that the Kaiser was the greatest menace to Europe and that he had to be smashed. He told them, "Go up and enlist, and smash the Kaiser, and I will guarantee to you that once you have smashed him, militarism will be dead in Europe for more than two generations." My folk went. They killed and were killed. They left their hellish slums, that they still live in, and out they went, little fellows, many of them, miserable of appearance, but out they went, and bravely they gave all. They fought, and fought, and fought, and won, and came back. Now, 20 years afterwards, the same men are being told the same thing. It is not the Kaiser now, but it is somebody else.
  Is this all that my folk have to be born for? Are they to be told at the end of every day that it is somebody else that they must smash? They know nothing about the great things of life. They do not know anything of the joys of life. All that they know of is poverty. It was said by one hon. Member that the German letter would never have been written a year ago. That is true, but there are things being said to-day that would not have been said a month ago. To-day we have a demand in the House for conscription. Ten days ago no Tory would have thought of raising his voice for it. To-day it is the common currency of conversation. The Prime Minister has told us that he is making a statement in a day or two which will show that the rearmament programme is going on and that we must intensify it. If we do that we must have men behind the arms. The great supply for the professional army comes from the poor. It is not manned by the sons of the doctor, the teacher or the Member of Parliament. It is manned by the men who are driven by hunger and can find little else to go to. To-day some men think that we can go into this war with only a professional army. We are living in conditions in which nobody knows how far his views may be popular or unpopular. I find a terrible conflict going on among honest men—a conflict amounting almost to dishonesty. They
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  want to see Hitler smashed and crushed, but they do not want to go out to do the crushing. It is always the other fellow.
  I come here from a division from which I have never been free in my political life. I saw the last War and saw men go out to fight in it, and I saw them come back and live in poverty again. I am not going back to my division to advocate the coming of conscription and to lead them into another war. I refuse to go back to lead my folk from their terrible poverty into a war which will not solve the great economic problems. The Leader of the Labour party said what I thought was true when he stated that until we understand the economic problems and get to grips with them nothing else matters. I refuse to go back to my native place to lead men into being slaughtered. I refuse to lead folk into a war from which nothing can be gained for the great mass of the people but further disaster and poverty.
  9.20 p.m.
  Mr. Hambro: This is the first time I have ventured to address the House since my return to it after many years. We have listened to-day to one of the most impressive speeches we have heard from that Box since 1914. I could have wished that this Debate had come to an end after the speech of the right hon. Gentleman the Leader of the Liberal party. Things are so dangerous that I would like to have seen, as I saw in 1914, the whole resources of the Opposition given to the Government in the policy which the Prime Minister will give us in a few days. What a help it would be to the Government to know that they had the Opposition at their back to help them through these difficult and dangerous times. We have our own opinions about what is happening in Europe, but it would be a great help to the Government to have that support. I cannot imagine that some of the speeches to which we have listened to-day will really help the cause of peace in Europe. The custom has grown up in the House in the last few years to take more interest in the Governments of Europe than was taken in the past. I would say without offence to hon. Gentlemen opposite that they started it when they took a violent attitude on behalf of Soviet Russia some years ago. I can understand that that attitude has cooled since, but naturally it has led hon. Members on this side of the House to join opposite factions. In regard

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  to the question of Spain, for instance, I do not mind who wins that conflict as long as it comes to an end, but I do not think that either the Government in Spain or General Franco would be a great factor for the peace of Europe.
  If we take more interest in the kind of governments that there are in Europe, it makes it much more difficult to keep the peace of Europe. It is no real concern of ours what governments other countries have. Our concern is to keep the peace of the world, and this House in the past has done it. My right hon. Friend the Member for Epping (Mr. Churchill) talks about the small States in Central Europe being a strong factor when they joined together. History shows, however, that the Balkan States have never joined together; indeed, they were called the powder magazine of Europe. Under the Versailles Treaty they have been split up, and I can only hope that my right hon. Friend is right in thinking that they will ever join together. All of us deplore what happened two days ago in Germany, but we all in our hearts knew, whether we liked it or not, that when the Continent of Europe was carved up, it could not remain the same for all time.
  The Prime Minister has one of the most difficult tasks to perform. The whole of Europe is looking to this country, and it is up to the House of Commons to show the rest of Europe that we mean this country to have a say in its affairs and that we mean to see fair play on the Continent. I should like to see every Member of the House at the back of the Prime Minister until we have heard what his policy is. When he makes his statement, then will be the time to criticise it. At present things are so dangerous that I hope Members will be careful what they say. Everything we say goes abroad and is translated into foreign languages, but what we mean does not always come out in the foreign languages. If the House does not give the Prime Minister full support, I am certain that the vast majority of the people of the country will do so.
  9.27 p.m.
  Lieut.-Commander Fletcher: The hon. Member who has just spoken asked the indulgence of the House for the speech he was about to make. I am sure the House was glad to give him that indulgence and will thank him for the very sincere speech that he has made. I should like to reinforce the plea that has been made to the
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  Government to exercise their good offices in mediating for clemency, should it be needed in the situation that has arisen in Vienna. I feel sure that the Government will respond to any appeal of the sort. Only this morning I received a telephone message from Vienna which emphasised how very helpful it was believed that efforts of that nature on the part of our Government and our Minister there would be.
  In considering the events that have taken place in the last two days I should like to recall one or two expressions of opinion given by the Government Press on the occasion of the recent visit of Dr. Schuschnigg to Herr Hitler at Berchtesgaden and the Austro-German agreement then concluded. The "Daily Express" said—
  "It does not matter."
  The "Daily Mail" went one better in saying—
  "Europe breathes more freely. This will consolidate and clarify the situation in Central Europe … all internal friction between Germany and Austria should now disappear."
  It will. The peace of the concentration camp will see to that. These extracts are an illustration of the wisdom with which the editorials of some of our newspapers are written. But it is not only the newspapers. Members of the Government have been rather good on the same subject quite recently. The Minister for the Co-ordination of Defence spoke at Havant in January and said:
  "When I read that Herr Hitler said in response to the representatives of other countries at his New Year gathering that he hoped for a year of peace and looked forward to working for the peace and happiness of his German people, I think that was something to be accepted at its face value. I am prepared to accept that at its face value and work upon it and build upon it a happier relation between Germany and this country."
  The Prime Minister, who read out to us to-day that contemptuous reply from the German Government, was speaking in his home town of Birmingham on 19th February, when he said:
  "Already we can say that as the result of this new strength Britain is listened to in the councils of Europe where she was not a few years ago."
  This appeared under large headlines "Britain is now listened to in Europe—The Premier." The statement relating to Defence presented to us a few days ago says in the second paragraph in

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  referring to the steps taken in rearmament:
  "They furnish a steadying influence on the present state of international relations."
  How vain and foolish these hopes and aspirations expressed by Members of the Government appear in the light of the events that have taken place over the week-end! The Prime Minister to-day gave a recital of our rights to interest ourselves in European affairs. I thought it was rather an academic recital and that for the Prime Minister to bring in the League of Nations, after his recent speeches darning it with faint praise, gave a very unreal atmosphere to his remarks to-day. To go on to speak of international co-operation after the conduct of his Government in regard to China and Spain and Abyssinia was not likely to carry much conviction. Why should Germany think we would act about Austria when, out of class prejudice and nothing else, this Tory Government is prepared to let Spain go under foreign domination, although the position there is strategically vital to our security? The National Government is very quick either to plead international law when it suits them or to ignore it when it suits them. They read lessons in international law to Japan while at the same time they are denying to the Government of Spain their rights in international law. They always want it both ways.
  Some hon. Members have been asking for assurances about Czechoslovakia. What value would those assurances be? Both Austria and Abyssinia had our assurances over and over again and what use have they been to either country? The fact is that the Conservative party has never shown any real disapproval of these violations of international law, although each in turn has brought danger nearer to our own country. It is no use for hon. Members opposite to ask us, "Would you fight for Abyssinia? Would you fight about Spain? Would you fight about Austria, or about Czechoslovakia?" That is not the question at all. The question is, Will you make a stand for international law? because this Empire cannot exist upon any other basis than that of international law, and if international law is swept away as the result of these constant violations of it, in face of which our Government remains supine, the Empire will go also.
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  When the League of Nations made a stand for international law in the case of Abyssinia the present Prime Minister called that stand "midsummer madness," and through his influence that stand for international law was called off. Now we are seeing the first fruits of the first great effort that the Prime Minister has made in foreign affairs. He sent the present Foreign Secretary to open conversations with Herr Hitler. He sent him to Berchtesgaden as his Rosen-kavalier, but it was the then Foreign Secretary who had to sing the Resignation music. The invasion of Austria is the grand set piece that concludes the Halifax-Hitler episode, and I have no doubt that Spain may provide the setting for the conclusion of the Perth-Mussolini conversations. I think our Prime Minister's brief excursion into power politics has not been very successful, and I think he must be remembering the old fable of the earthen pot which tried to swim with the brass vessel.
  We had a great speech, as usual, from the right hon. Member for Epping (Mr. Churchill). I was very glad to notice his kindly interest in the working classes of Austria. They will feel very grateful to him for suddenly remembering their existence. He recited to us a long catalogue of the obvious results which will follow from the annexation of Austria by Germany. He left one thing out. He forgot to tell us that German stamps will replace Austrian stamps. A great deal of what he told us was in that category. The right hon. Gentleman made some very proper remarks indeed about the League of Nations and about collective security, but what we on these benches would like to know is exactly what the right hon. Gentleman is prepared to do to achieve these objects? In spite of these speeches which the right hon. Gentleman makes to us he remains attached to a party which has abandoned any pretence of believing in the Covenant of the League of Nations or in the doctrine of collective security, and the right hon. Gentleman is powerless to influence the Government party because he does advocate those views in this House, in face of such jeers as he mentioned came from the hon. Member for East Aberdeen (Mr. Boothby) this afternoon. He cannot influence the Government party because he advocates these views about the League and collective security, and

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  he has no influence with those in other parties who advocate these views, because he remains a Member of the Government party. He is in a cleft stick. He has no influence either way. The fact of the matter is, the right hon. Gentleman just sits on the fence in these matters and impartially scolds those on either side of him, and, as ever, he says the right thing but does not do it.
  I noticed in the "Times" to-day a contribution from Lord Lothian, who was so very largely responsible for the opening of the German conversations and for the humiliations which have followed upon them, and I see that Lord Lothian now finds in the invasion of Austria a reason why the Colonial and the Mediterranean questions "can become the subject of negotiations upon equal terms." That is the impression which these events have conveyed to the Noble Lord's mind. But he goes on to show that to bring about this happy state of affairs this nation must show "moral discipline and resolution." Then we shall be able to discuss the Colonial question upon equal terms with Herr Hitler. Lord Lothian's influence has been disastrous, and his policy lies in ruins in Vienna to-day.
  This coup in Austria has been along the usual lines. It has happened at the week-end. On this occasion the German Foreign Secretary was sent over here in advance to give our governing classes a good meal. I noticed the list—all the free fooders were there. And then, while they were either digesting that meal, or away for the week-end, Herr Hitler strikes. We make representations; we are very pained and grieved—just as we are when either Franco or the Japanese blow our ships up; we send a protest; we are giving the situation continuous attention; and the Foreign Office has what is called in a bulletin "a restless night." The right hon. Member for Epping brings into action all his battery of adjectives—" grave," "sombre," "grievous," "formidable," and so on. And there, so far as this Government is concerned, the matter ends with words. What is the use of telling our Ambassadors to make protests? What we ought to do is to tell the Minister in Vienna to take a wreath and lay it on the grave of Austria's independence, for it is a funeral and nothing else. He can go and attend the
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  funeral of Austrian independence, but protests are useless.
  Assurance after assurance has been given in this House and by this Government on the subject of Austrian independence. Herr Hitler has shown himself a very shrewd judge of what those assurances were worth. Democracy has been beaten again, and yet we go on expecting small countries which lie in the path of Germany's next advance to stick to their belief in democracy. Perhaps Austria was bound to go. Perhaps what we are complaining about chiefly is the manner in which the extinction of Austrian independence has been brought about. I agree with other hon. Members that the fate of Austria was decided when the Austrian Government decided to shoot up the workers' movement. I think that only by an adherence to democracy could Austrian independence have been preserved. In spite of that the rulers of Austria preferred to go and sup with the devil of dictatorship, and they had only got a teaspoon to do it with, and that was not long enough. It is very significant that at the last moment, when Dr. Schuschnigg realised that the position was critical, we hear that he tried to open conversations with the representatives of the Austrian workers' movement. He realised at last where his mistake had been and where the true strength of a country lies.
  The events of the last few days exemplify all over again the painful truth that this country is never ready for any international crisis, no matter how plainly its approach has been announced.
  Mr. Magnay: But she never loses.
  Lieut.-Commander Fletcher: It is the latest, but it will not be the last, of the series of humiliating diplomatic defeats which we have had to endure ever since 1931. One humiliation, one defeat after another—the questionnaire to Germany which Germany rejected on the ground that Germany was not doing homework for us, the long humiliation of the Nonintervention Committee. Ever since 1931 there has been a steady diminution of our influence and of our prestige and, what is worse, a steady loss of friends. Who are the friends upon whom we should rely to-day? Is it France, whose Government we always inform but never consult about any step at all, but with whom

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  we are always, of course, in the firmest and closest touch under this Government? The Government and their supporters tell us on these benches that we want to involve the country in a war of ideas. I do not apologise for that. If a man has an idea to hit me on the head, I certainly will fight for the idea of not being knocked on the head, and I try to find some friends who agree that I ought not to be knocked on the head. That is not a contest of political theories; that is common sense, and if that is what is meant by a war of ideas, then I certainly am in with that war.
  Mr. Beverley Baxter: The hon. and gallant Member has asked what friends will come to the assistance of this country. May I speak for one? I speak for Canada—Canada, which is grateful to this country and to this Government for having preserved the peace of Europe so long, for having so faithfully tried to put forward to the world a foreign policy that was in its basis Christian and forbearing and which apparently has failed. I answer for that one country within our own Empire.
  Lieut.-Commander Fletcher: I am sure that the whole House has listened to those remarks with the warmest approval and with the greatest pleasure. I must, however, point out that when I was thinking of countries who are friendly to us I was not thinking of the Dominions, because I always assume that they are friendly. [An HON. MEMBER: "What about France?"] I have just been making a few remarks about France and saying that we shall have to consult France a little more instead of merely informing her of our actions, if we wish to retain her friendship and support. We are all asking what can be done at this juncture. Very little can be done, I think, so long as this Government remain in office. Look at the results since 1931. To begin with we have had four Foreign Secretaries. That does not look very much like success, does it? Then let us remember Abyssinia, China, Spain and Austria, all countries to whom we had obligations and had given assurances, and all attacked; one of them conquered, and one annexed, in defiance of everything for which our Government say they stand. Our position and interests in the Far East have been jeopardised.
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  War in Palestine, the whole strategic position in the Mediterranean threatened by the events in Spain, the League of Nations smashed, many of our friends lost, a vast rearmament race started. The long-drawn-out humiliations of the Nonintervention Committee. The inglorious end of the Halifax-Hitler conversations, those are all the fruits of National Government in the realm of foreign affairs.
  If the Government wish to give proof of sincerity in what they say about the League of Nations and collective security will they take steps to stop Italy and Germany from overrunning Spain? They can do so if they wish, but do they wish? So far their conduct of foreign affairs has been a rake's progress. It is for the country to check that progress before we crash. We must certainly press on with rearmament but unless Europe really knows in advance where we stand on vital matters and unless we work at the same time to re-create a system of collective security and to re-establish the League, to make some friends in Europe, to draw more closely to the United States of America and really to work sincerely with France, rearmament, however large, or conscription, can never save us from a crash.
  9.48 p.m.
  Mr. Vyvyan Adams: One of the most remarkable and enheartening facts which have emerged in the course of this sombre Debate has been the large measure of agreement manifested on all sides of the House in relation to many aspects of the deplorable issue which we are discussing. I even found myself in agreement with the hon. Member for West Fife (Mr. Gallacher) when he implied that he would not put anything past the evil men who rule to-day in Germany. On the other hand, unlike him and the hon. and gallant Member for Nuneaton (Lieut.-Commander Fletcher), I do not desire the downfall of the National Government. The alternative may be red, but it is not rosy.
  As I have listened to every speech that has been delivered in this Debate, perhaps I might be allowed to refer in particular to the two superb speeches which fell from my right hon. Friend the Member for Sparkbrook (Mr. Amery) and my right hon. Friend the Member for Epping (Mr. Churchill). The speech of the right hon. Member for Epping was a sufficient answer to the highly provocative words

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  which fell from my hon. and gallant Friend the Member for Bournemouth (Sir H. Croft) who deprecated any attacks upon Italy. I cannot understand why he should deprecate such attacks. There does not seem to be much amiss in a little gentle criticism of Italy, especially when you consider how that country has torn up treaty after treaty, has reviled this country, and has recently committed one of the most savage aggressions in history. If the hon. and gallant Baronet the Member for Bournemouth had in 1935 been as zealous for the rule of international law as both he and I are for the rule of law and order at home, and if he had raised his voice to a trumpet call in that cause, the world to-day might be a much more orderly place.
  I should like to be allowed to say that I am personally very grateful to the Prime Minister for the full opportunity which has been given to this House to-day to discuss the emergency. Whatever may be happening to-day in the trampling down elsewhere of freedom, democracy and liberty of speech, this Parliament still remains in a peculiar sense the fortress of truth. If, at the time of the Rhineland invasion at the beginning of 1936, the voice of this House of Commons had not then been muffled by the blanket of discretion, the course of European history might have been different during the last two years. No words are strong enough to condemn the action of Germany. Her conduct is obscene and abominable, and the fact that it has been exactly what some of us were expecting does not make it any more venial. This opinion seems general, extending even to pro-Nazi organs of the Press. Even the "Times" newspaper has ceased to canonise Herr Hitler, and I noticed yesterday that the eulogy in the "Observer" was a little less beslavering than usual. What has happened to the pro-German element in this honourable House? They are singularly subdued to-day, almost taciturn.
  We can see how Herr Hitler has been led to assume that Great Britain would be practically indifferent to the fate of Austria. There was, first of all, coming from a great authority, the monstrous question-begging remark made in the summer of 1936 by the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) whom we are all sorry not to see in his place to-day. I understand
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  from an hon. Member beside me that the right hon. Gentleman is ill. If that is so, I am extremely sorry that I made this reference. I did so only because I thought it was extremely indiscreet when he said that the people of England would never fight again in an Austrian quarrel. Then there is the very vocal attitude of the pacifists in this country, represented particularly by the right hon. Gentleman the Member for Bow and Bromley (Mr. Lansbury). That is an attitude which, by anticipation, betrays the entire independence of the small countries who are the neighbours of great expansionist and aggressive States. I wonder if the pacifists in this country, who claim to be growing and expanding in number from day to day, recognise the damage that they are doing to the Rule of Law and to the interests of the small nations who have every bit as great a right as this mighty nation in which we live to maintain their own integrity.
  Beside those two schools of thought there is the savage, stupid, prehistoric cry of the isolationist, best expressed in the phrase: "The independence of Austria and Czechoslovakia are not worth one British life." That statement might proceed out of the jungle, but, as long as it is made in this nation and in other great nations, no progress whatsoever can be made to establish throughout the Continent of Europe or the world the Rule of Law. Nothing can be less patriotic than that line of argument, which might win cheers when delivered upon a platform, but which, if applied in domestic relations, means precisely nothing, and would mean chaos and anarchy to-morrow. I am not concerned primarily with the past. What matters to us is the present and immediate future, and I am not going to avoid the immediate present. However damaging it may be personally to me to say so, either inside or outside this House, I say that we ought to take a stand now upon this issue of Austria. As a pre-condition of any such action we should ask our Government to request a meeting of the Council of the League of Nations.
  In any event, I earnestly beg His Majesty's Government to do two things; first to carry out literally the new pledge which the Prime Minister has given to-day, to accelerate our rearmament programme. On the other hand, it would be

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  wrong, it would be a disservice to the cause of truth, for this country of ours to pretend that it is any longer a relatively weak nation. It is not. Our power is great and growing. Only the other day it was described by the Prime Minister as a terrifying power. It is right that we should use its terror in the right manner. We should use that power to terrify Herr Hitler.
  Much more important, in my humble submission, is the second plea which I now make for something which I have been begging His Majesty's Government to do for the last three or four years. It is that we should join with France and other States members of the League in guaranteeing the independence and the integrity of Czechoslovakia. That would be perfectly consistent with our existing obligations under the Covenant of the League of Nations. It would be no more inconsistent with the Covenant than the obligations which we specifically assumed under the Treaty of Locarno. Hon. Members in all quarters of the House, pacifists as well as isolationists, are entitled to say, if they like, that this course involves its risks. That is true, but the risk of not taking it is greater.
  I am glad that the Prime Minister has now come in, because I would like to make my appeal directly to him, if the House will allow me to repeat my last few sentences. I was saying that I wish the Government would do something which I have been urging them to do for the last three or four years, namely, to join with France and other States members of the League in giving to the free, democratic, Anglophile republic of Czechoslovakia a specific guarantee of its independence and territorial integrity. I pointed out just now, and I hope my right hon. Friend will forgive me if I repeat it so that he can hear, that this course would be perfectly consistent with our existing obligations under the Covenant of the League of Nations, and I went on to say that, while this course has its risks, the risk of not taking it would be greater. The consequence of not taking that course would be, I am quite certain—and I think most hon. Members will agree with me—a procession of aggressions resulting in success for the aggressor Powers and sending those aggressor Powers from strength to strength. If we do not take this risk, the day may come
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  when this country of ours, Great Britain, which every party in this House loves from its heart, will, in virtual isolation, be faced, not only with war, but also with defeat.
  9.59 p.m.
  Mr. Alexander: There is a large number of Members of the House of Commons who will agree with the hon. Member for West Leeds (Mr. V. Adams) that to-day's Debate has been remarkable, in spite of its sombreness, for the fact that so many points of agreement have been submitted from different parts of the House. It is, perhaps, to be expected, when the legislative assembly of a great nation like this comes up against a major crisis in international affairs, which is likely, from our experience of the last two or three years in Europe, to lead to an almost immediate and still greater crisis, that Members of the House will seek to look at the issues involved with the greatest amount both of seriousness and of responsibility, and, in the interests of the nation, will endeavour to find as many points of agreement as possible, while not neglecting their duty of pointing out to the Government of the day what may be the points of difference.
  I have been very interested to observe, having regard to the debates on foreign affairs that we have had since the last General Election, the changed attitude of many hon. Members opposite to-day, as compared with the part that they have played in the debates of the last few years. I agree with my hon. Friend the Member for Jarrow (Miss Wilkinson) in appreciating the sincerity of the right hon. Gentleman the Member for Sparkbrook (Mr. Amery) in his plea to Members on these benches, as well as in other parts of the House, for some measure of unity of action with regard to defensive instruments of force. I wish that the right hon. Gentleman had been as willing to accept our plea for unity on the part of the nation for a constructive policy of peace during the last few years. If, however, it means that the right hon. Gentleman, who may have differed sincerely from our point of view in the past, can now seek a real point on which we can stand together for constructive purposes, as far as I am concerned I shall be prepared to act with him. But I am not prepared to act with hon. Members opposite on the basis of simply asking

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  first for an unlimited programme of armaments backed by unlimited military training, as yet undefined, for the purposes of a major war in Europe in circumstances which are as yet undefined. That is not the position which we on this side of the House have taken all through these debates on foreign affairs, and in the debates, especially, with regard to preparations for defence.
  While I am most anxious to-night not to speak on behalf of my party in the direction of partisanship, but from the point of view of trying to get the largest measure of agreement possible in real constructive effort for peace, I hope the Prime Minister will forgive me if I mention here and there a point in which I think we might have saved some of the difficulties that we now have to face in our constructive efforts for peace. The party for which I speak to-night has never wavered since 1918 in its twofold plea, first, that you should be fair to the victim of defeat in the last War, and should arrange as soon as you possibly could for the economic appeasement of the peoples of the nations who were said to be defeated; and, secondly, that, as soon as the Covenant of the League of Nations had been drafted, assented to and signed by those States who joined the League, the Covenant of the League should be used to the full. At this moment, when we are asked for constructive effort, we have to say to the Prime Minister, not with any feeling of bitterness or hostility, but looking the present crisis in the face, that, if the Government had followed with sincere devotion the wholehearted support of the League of Nations that we have advocated, in the last two years that they have been in office, even if not before, we should not be facing the crisis that we are facing to-day.
  I want the House to realise from a very brief sketch the causal connection between the different events which have marked, during the National Government's two periods of office, the retreat from principle in support of the League. From the moment when we failed to take effective action in support of the League Covenant over Manchuria, the stage was set for the next piece of drift. [Interruption.] I have not interrupted anybody, except to ask one straight question of the hon. and gallant Member who talked about constructive effort, and I hope that in the very short time I have
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  —I want to give adequate time for the Government representative to reply—I shall be allowed to finish my speech. That particular drift led at once, according to those who have had experience in the inner conversations at Geneva, to the incident in connection with the Chaco war. It was immediately said, even by sincere supporters of the Covenant of the League at the Geneva meeting, how could they prevent the export of arms to Paraguay and the other side if no action was being taken with regard to Japan in Manchuria? You had the immediate repercussion of the failure to act in the case of the Chaco dispute, on top of the Manchurian dispute, when you came to the Abyssinian situation. Mussolini expressed his surprise and horror that the principal Powers of the League should dream of taking a policy of opposition to his aggression in Abyssinia, of imposing sanctions and, if necessary, enforcing them, against him by military strength; because, he said, the League had never dreamed of doing that in the case of Japan; it had not even done it in the case of the Chaco war, and how dare they suggest doing it against him in the case of Abyssinia?
  We come to the case, which the Labour party has always put to the Government as being just as justifiable on League principles as any of the others—the case of Spain, which ought to have been treated by the League, within a very short time of the outbreak of hostilities, as a case of invasion by an aggressor. Everybody knows that Mussolini was saying openly that if the Governments who were the principal leaders in the League could have nothing effective to say or do with regard to the completion of the policy of sanctions in Abyssinia, it would be quite safe for him to ignore his pledges under the Non-intervention Agreement and to go on with his plans for making Spain the Western stronghold of Italy for the purpose of making the Mediterranean an Italian lake. That is the cause of the situation we are in to-day, in which Member after Member on that side has to get up and appeal to Members on this side for their support, Yet, during the last few years, directly we mentioned collective security and the enforcement of sanctions, they have always turned and taunted us with being the party that wants war. But the Prime Minister to-day, speaking with a frankness for which we admire him, has brought the

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  House up against a war situation in Europe which has arisen because of the failure to stick to the League. We are now being asked to co-operate with Members on the other side in a policy of national defence, to defend liberty in Europe, with as many allies as we can possibly secure in the immediate circumstances. That is the basis of the appeal.
  I want to put to the Prime Minister, first of all, that I appreciated very much two of the main points in his speech. I appreciated that straight and plain condemnation of the use by Germany of naked force in the destruction of Austrian independence. I felt that that gave us a good deal of hope of a change of mind and heart and action by the Government. I have been reading more carefully in the late edition of to-night's paper the actual words used by the Prime Minister: with regard to the fact that, while he did not want to make hasty decisions—this was not a time for careless words—he might have to ask for a review of the defence policy. I am quite sure that my colleagues on these benches are, in the main, perfectly willing to assist the Government in any real defence measures needed for collective action against an aggressor, but I am certain also that they would ask me to put to the Prime Minister this question: When you talk of the need, in view of the change in the situation, for a review of defence, do you recognise, and will you agree with us on a change in foreign policy? I think that is right. We have felt in the last few weeks that there was a pretty dangerous situation growing up. The Leader of the Opposition said so. The hon. Member for South Shields (Mr. Ede) to-night, I think, drew attention to the fact that the Leader of the Opposition said recently that it might not be long before the German Army was on the Brenner Pass; and that it had happened in three weeks. What I want to say to the Prime Minster is, will he not consider, not merely reviewing the defence basis, but considering at once, and giving a clear statement about it as soon as he has made up his mind with his Cabinet, an entire change in the outlook from that which he showed when the right hon. Gentleman the Member for Warwick and Leamington (Mr. Eden) resigned. It is perfectly clear that, whether they were mistaken or not, the Government were sincere in their point
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  of view that they thought the opportunity had arisen for negotiation which would separate Mussolini from Hitler.
  The Prime Minister indicated dissent.
  Mr. Alexander: I am quite sure the Prime Minister never said that in words; but I am sure also that there is not a student of foreign affairs in this country who has not believed that that was the policy of the Government in recent times. We uttered the warning that, judging from statements made by Herr Hitler in his Sunday speech a few weeks ago, it was unlikely that such a result would be achieved. We have also seen that Signor Mussolini was as much pledged as anyone to safeguard the independence and integrity of Austria. When we see that, we realise that the Leader of the Opposition was correct when he said that the structure of cards that the Prime Minister had erected was knocked down. Will not the Prime Minister see that, on this great issue of trying to secure peace, coupled with the freedom and liberty which our fellow-countrymen have died so often in the past to retain, he would stand a better chance of securing national unity behind that policy if his Cabinet would at once summon the Council of the League, and put it to them, with all the force of leadership that a British Prime Minister can exercise if he will, that every peace-loving nation left in the League should gather together not only to pass resolutions with regard to the maintenance of peace against the aggressor, but to pool now their economic, military, naval and air strength. There is no other way, in my judgment, of preventing the next movement by the dictator in Europe against the peace and liberty of other States in Europe.
  While a great many things have been said with regard to the danger of Czechoslovakia and all that that involves to the future peace and freedom of Central Europe, I agree with others who have pointed out that it is just as likely that the more immediate effect of the events of this last week-end will be still further pressure for completing, as they hope, the conquest of the people's government in Spain. I should hope that at this time His Majesty's Government will be prepared to put to the League the question of collective action in order to prevent a Fascist State being established with the

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  support of Italy and Germany, who would thereafter be able to call the tune in that country in regard to the conflict with these aggressors in the future as between themselves and the League policy.
  I wonder whether the Prime Minister would consider that? I do not suppose that we can expect an answer to-night. It is a very difficult situation for him. I ask him to put that in all sincerity to his Cabinet with a view to action being taken. May I put it from this point of view? The National Government for over two years have had the continuous opportunity of national unity on a League policy. In the course of the dealing with the Abyssinian situation the Trades Union Congress in September, 1935, and the Labour Party Conference in October, 1935, by an overwhelming majority in each case, authorised those who speak for them in this House to put that League policy, and they have authorised us since not only to put that policy, but to say that whatever arms are required for collective security we will vote. You have the opportunity to get national unity on that point, and it depends upon the Government themselves, now face to face with difficulties, which, unfortunately, we foresaw and foretold, having to make the best they can of the situation. I hope, therefore, that the Prime Minister will put that point to the Cabinet and that he will give the lead to the Cabinet, and to the League. What is the alternative to collective action? It is perfectly true that we have an arrangement with France and that France has an arrangement with Czechoslovakia. Here is the position that we are in. We shall probably have no other set ally to look to with regard to the protection of freedom and liberty in Europe to-day unless we can act upon the basis of the League for the actual restraint of the aggressor.
  I appreciated the statement of the Prime Minister repudiating entirely the claim from Germany that the Government were not within their rights in making their protest and in being interested in the position in Central Europe. I think that there again is an indication probably that the Government statement on these matters is more satisfactory. I hope that that means that it is going to lead to much stronger support of the League policy. It depends upon how heartily you are prepared to support the
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  main principle of Article 10 of the Covenant, which was at the base of the separate agreement for Austrian independence, which the Prime Minister quoted in his speech.
  With regard to the question of getting the country behind this policy, I have discussed the matter a good deal in the last few hours with colleagues, and I should be expressing the view correctly on their behalf if I say that when you talk about negotiations and conversations of the kind in which the Government have been interested in the last three or four weeks, the reply which has been given by the demarche in Austria ought to show the Prime Minister that along that way no final peace can be secured. If he wants the support of the great majority of the people of this country for a constructive collective policy, we are right in saying that he cannot expect it by trying to make a separate deal with a crooked person like the Italian dictator. The way in which his promises to Spain and the people of Spain have been broken in the past, and the experience that we have had, shows that the Government cannot expect to get unity in this country on a collective policy if they are going out, first of all, to make a separate and prejudiced deal with one who is not keeping his promises in respect of Spain.
  Let me say a few words about the future. A great number of people who take a general League view, such as I do, and about which I have been speaking tonight, are very much concerned at the way in which at the present time the armaments programme is built up. I have heard a good many arguments tonight about our Defence forces being depleted and neglected in the last few years. If we had been prepared to act on purely League principles in 1931, on the strength that we had then we should have been relatively as strong and able to act as we are to-day in relation to the forces in the world that are against us. We should have been just as well able to act then for the sanctions policy as we are to-day. In other words, unless you are dealing with a policy based upon the whole League and collective security, armaments in themselves will not bring security, because those armaments beget armaments in other countries.
  There is among a great number of my hon. Friends in this party a feeling that while they are willing, on the decision of

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  our party and of the Trades Union Congress, to say that whatever forces are required at this moment for collective security ought to be supported and voted for, they look to the time when, by giving a proper lead and giving proper moral support to the League, great individual national forces will not be required, because we shall have established an international police force. But we cannot hope to get that international police force functioning until we have by a larger number of nations moral adhesion to League principles and a determination to resist the kind of thing that we are facing to-day. Until we have a larger number of nations doing that, we shall not get that agreement which is essential for an international police force. In the meantime, we cannot afford to let the aggressor go on demoralising the position in country after country as is happening to-day. Nevertheless, speaking for myself and for my friends, we feel that such a police force must not be lost sight of. We feel that the situation which confronts us at the moment has not been created by us but to a large extent by hon. Members opposite who have been making speeches for the last four or five years and who have been drifting away from the principle of collective security.
  I want to say on behalf of the Labour party one thing which must be said on such an issue and on such an occasion. It is this: While we hope that the Government are going to stop a policy of drift and by a proper collective system of armed resistance if necessary to an aggressor in Europe, we do not think lasting peace can be built that way. Unless there is going to be a liquidation of those factors which make for constant irritation, anger, strife and jealousy between nations, we cannot hope to have permanent peace even by the action which has been suggested to-night. We know the kind of general policy which Hen-Hitler has in mind in regard to Central Europe. We know the kind of speech that Signor Mussolini made, I think it was, in October, 1930, about the possible ideal of a Fascist Europe. We hardly believe that they are likely to give up that particular line of thought, but they will not live for ever, and we do not ourselves hold any hate for the great masses of working-class people who are Italians and Germans. They have
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  economic rights which ought to be granted. They have a right to equality of opportunity for living a proper life in the world, the same as any other nation.
  We are anxious as a party that the Government should go back to the League and start right away with a collective policy against an aggressor, but we are anxious also that they should start considering agreement upon a larger and wider basis for peace. I am not in favour, nor is my party, of giving away colonies by chunks to a country which happens to be led by an aggressor, but we are perfectly willing to consider, upon the basis of a revision of the Mandates system, a proper access to raw materials and food with any nation in the world by agreement. I believe that if this country, in conjunction with a collective security policy, would give a lead in that direction, it would do a great deal towards the construction of a more permanent and stable peace. The way in which we have criticised the Government to-night may have been strong criticism, but it is not in any way with a desire to be harmful or dangerous, having regard to the situation in Europe. We want the Prime Minister to realise, with regard to collective security, that the Government will get a very great measure indeed of national unity and support.
  There was in the Prime Minister's speech one phrase which caused some anxiety to hon. Members on these benches. In regard to the general requirements for Defence to-day there are those who can make a good case that if sacrifices are to be called for from the people the sacrifices should not be confined to a section of the population. That has always been a basis of principle with the party for whom I speak. Any question of going in for a whole system of conscription for national military service until we have settled what it is for, whether it is for a policy of collective security or not, will require a great deal of examination. Moreover, it would have to be most carefully examined for the purpose of seeing whether it was to be accompanied by sacrifices on other grounds than military service.
  As my hon. Friend the Member for Jarrow (Miss Wilkinson) pointed out earlier in the Debate, if there is to be talk about conscription for military service, there must be conscription of profits.

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  Profits ought not to be made out of war, when there is the suggestion of taking men's lives. Therefore, I hope that the Prime Minister, later on, will be quite clear on that point. If he is going to talk about the extension of military service, we want from him two things: first, we want to know what is the policy to be adopted in regard to collective security and the principle in international affairs to-day; and, secondly, we want to know what are to be the sacrifices called for from other members of the community as well as from those who are to be asked to give military or naval service. All of us hope that the frank expressions of views which we have had in the House to-night may lead to action which will evolve some measure of change of policy on the part of the Government that will lead us back to the League and collective security. We regard that as the only means of avoiding a major struggle in Europe, and we ask the Prime Minister to give it his consideration.
  10.32 p.m.
  Mr. Butler: Hon. Members will not expect me, on behalf of the Government, to make any fresh declaration at this hour, but rather to place myself at their service and to answer any points that have been raised in this very interesting Debate. As the hon. and gallant Member for Bournemouth (Sir H. Croft) said, this is a time for the whole Empire to think calmly, clearly and firmly, and I would be the last to wish that any hasty word of mine should take away from the value of such calm and collective thought at this time. I should like to welcome the very thoughtful and sincere speech of the right hon. Gentleman the Member for Hillsborough (Mr. Alexander). We must acknowledge mat in his approach to the subject he was perfectly sincere, and that he brought a great deal of thought to bear upon the serious difficulties which are before us. I should like to pay the same tribute to the speech of the right hon. Gentleman the Leader of the Opposition. I hope that in any remarks which I make, a similar sincerity may be read, and that if I attempt to deal with some of the difficult problems which hon. Members have raised, they will give me the opportunity of doing so in a thoughtful and calm atmosphere.
  As for some of the other speeches to which we have listened from hon. and right hon. Members, we have heard the
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  old cliché that the speeches should be non-party ones. It is not for me to take advantage of some of the partisan statements made in those non-party speeches. What I have noticed, however, is that even if some of the speeches have been of a party character and extremely partisan, their sincerity has been all the more marked because of the vehemence of the outbursts which they have contained. Having made these few remarks, I do not propose to enter into the somewhat controversial fields over which some of the speeches have ranged. The main subject for discussion before the House this evening has been the unfortunate question of Austria. Out of that terrible incident which has just taken place have been raised several issues concerning the foreign policy of His Majesty's Government, and in particular, their policy with regard to the League. It is to that main subject that I shall address myself.
  In passing, I should like to say that we have observed all the arguments and points which have been put to us on the subject of Spain. I am not, however, prepared to go into that question to-night. If I did so, I could not cover the ground which I have to cover and it would mean leaving the other and more important subject—as we think it is at the moment—which is before the House. But I wanted to mention Spain in order to show the importance which we attach to it and to say that many of those vital points which have been raised are being considered at the present time by the Nonintervention Committee. There was one sentence in the speech of the hon. Lady the Member for Jarrow (Miss Wilkinson) which I think moved all of us. It was that in which she said that no heriosm could stand against machinery and aeroplanes. That is indeed a sinister reflection upon modern warfare and the brutal and forceful methods of to-day, and it leads me to the main point of agreement in this Debate.
  There has been agreement on all sides of the House in deploring and condemning the methods by which Austria's independence has been taken, from her. Those of us who know Vienna—and perhaps my memories of it do not go back as far as those of some hon. and right hon. Gentlemen here—feel that Austria and Vienna had a particular culture and a particular character of their own. When I heard the hon. Lady's remark I could

  163
  not help regretting the machinery and the armaments which are at the present moment rolling over that culture in that land, and I could only hope that that gay character and that culture which we associate with the Viennese would not be completely trampled underfoot. In that connection I wish to inform the House of representations which have been made by our Ambassador in Berlin, first upon the subject of the withdrawal of troops, and secondly upon the subject of the Catholics, Jews and Socialists to whom reference has been made in this Debate.
  It would be impossible for any words of mine to express how solemnly His Majesty's Government feel in this matter and the importance which they attach to the representations in favour of clemency, toleration and moderation that we have made. We have received reports that the German army will be withdrawn after a certain period, when normalcy has been restored; and we have made further representations on that subject, in view of reports which have reached us that the German and Austrian military forces are being amalgamated. I sincerely hope that the assurances we have received will be carried out. We have also authorised our Minister at Vienna to make representations on the subject of the Jews, Socialists and Catholics, and to seek assurances that every effort will be made to ensure a sense of moderation. I am afraid I must leave the subject at that, while indicating that His Majesty's Government have done their utmost to bring these matters to the attention of the authorities.
  Now I come to the requests made by hon. and right hon. Gentlemen opposite on the subject of our policy with regard to the League of Nations. I think it would be valuable if I said, first, that our policy remains as it was stated by the late Foreign Secretary at the hundredth meeting of the Council of the League in January. May I read to the House his words:
  "His Majesty's Government consider that the League, in spite of existing limitations, is the best instrument that has yet been devised for giving effect to the principles of international co-operation, and they are therefore determined to keep it in existence, to give it their full support, to make use of its machinery and procedure to the fullest extent that circumstances permit. Within the limits which they have to recognise, they intend to make it as efficient au instrument as possible."
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  That was the policy as stated at the hundredth session of the Council of the League. To state now that His Majesty's Government frankly recognise the limitations which at present handicap the work of the League does not mean that they are any the less loyal to its principles or less determined to do all in their power to extend its influence. There are those who are reluctant to face facts and refuse to acknowledge the limitations under which the League at present lies owing to its restricted roll of membership. That, I think, will show that our policy in this matter has been consistent.
  I have heard many appeals to-night that our policy should be directed towards making collective security a reality. One of the difficulties about collective security, and what, as the right hon. Member for Epping (Mr. Churchill) said, makes it ridiculous, is the fact that we have not got it, and as I have just stated, it is the general policy of His Majesty's Government to proceed to make it a reality if it can be made so. I will quote some words of my right hon. Friend the Prime Minister on the 2st December last in regard to the policy of the Government. He said:
  "We shall continue to give it (that is, the League) our warmest support, believing that it can still afford the nucleus for the better and more comprehensive organisation which we believe is necessary for the maintenance of peace."—[OFFICIAL REPORT, 21st December, 1937; col. 1810; Vol. 330.]
  That then is the general line of the policy of His Majesty's Government, facing the facts, realising the limitations, and working as far as possible to achieve an ideal which seems to be shared by all sides of the House. This question has been further pursued by hon. and right hon. Members opposite, and we have been asked, first of all by the right hon. Member for Lime-house (Mr. Attlee), whether we would take this question of the rape of Austria's independence before the Council of the League. That subject has been raised by many hon. Members who have spoken in the course of this Debate. At this stage I want, with the sympathy and, I hope, attention of the House, to discuss dispassionately some of the difficulties which present themselves to us in the course which has been suggested to us.
  Mr. Attlee: I did not suggest bringing immediately the particular point of Austria before the League. What I suggested

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  was that the League of Nations should be called together to see that the League shall stand firm against any continuation of this policy of aggression.
  Mr. Butler: I noticed in my notes of the right hon. Gentleman's speech that he referred to the Assembly, but the point of bringing this matter before the Council has been raised, and so I should like to address myself to that first and then address myself to the point of the right hon. Gentleman, that there would be force in the moral gesture to which he referred. First of all addressing myself to the point that has been put in several speeches, that we should bring this particular issue before the League, I am bound to ask myself what would be the difficulties of this position, and from the discussion which we have had with friends of the League we find that there is unanimity that that course would not be conducive either to a realistic solution of the problem or to any satisfactory result, but would probably result in a more humiliating position. If we examine the position of Austrian independence under the Treaty of Versailles or the Treaty of St. Germain, we find in both that there are Articles which state that the independence of Austria shall be inalienable except with the consent of the Council.
  The independence has now been violated, and if we examine the juridical position, we find that it is one that the parties to the Peace Treaty could bring before the League. With regard to the first aspect of the problem, this would necessitate the League considering the alienation of the independence of Austria, broken as it has been, according to these two treaties, on the present occasion. If we adhere to the first point I have put to the House, the only humiliating result would be, if unanimity were reached, that the League might give consent to the alienation of Austrian independence. On the juridical position, the House will readily see that no progress could be made and that there could be no value in following this particular line.
  Let me follow a second line. Would it be valuable to put this question before the League or, to take the right hon. Gentleman's point, the Assembly of the League, at the present time? After the examination that we have been able to give to this question up till now, we consider
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  that any such action would be most likely to prejudice the future of the League and, in particular, its ultimate reconstruction. We consider that no very useful result would be likely to come from referring it to the League at the present time.
  Mr. Attlee: I did not suggest that this particular case should be brought before the Council or the Assembly. My point was that it was time to call the League together to consider the position of the world in view of this action and to avoid possible future actions of this kind.
  Mr. Butler: I appreciate the right hon. Gentleman's correction, which I accept, but I think the position in both cases would be very similar because, if we were to summon the League to consider the general question, it would surely be similar to putting this particular question to the League. To take the third consideration, if the League were to be summoned and this question put before it, the possibility of the use of immediate force in this connection would, I think, be agreed by all sections of the House to be impossible. The result is that the more we examine the possibility of summoning the League at the present moment or putting this particular issue before the Council of the League, as has been suggested, the more we see the difficulties that would arise from this particular solution of the problem.
  Mr. A. Henderson: Is it not possible for the Council of the League, and perhaps the Assembly also, apart from the juridical aspect of this problem, to condemn, if it though fit, the method by which the annexation of Austria has been accomplished?
  Mr. Butler: It is possible to follow the hon. Gentleman's suggestion, but we maintain that in the present state of the history of the League and the limitations of its present position, which I have described, it would not be a valuable course to pursue and would be more likely to prejudice the eventual reconstruction of the League. I am obliged to the hon. Member for enabling me to make my point clearer in this respect. There may be a sincere difference of opinion between us, but I can assure him that, after our consideration of the subject, we do not think that this would be a valuable course to adopt.
  Mr. Churchill: Will my hon. Friend say what he means by "eventually reconstructed"?
  Mr. Butler: My right hon. Friend will be aware that the ultimate policy of the Government in regarding the League of Nations as the ideal method of conducting international relations remains and will remain their ultimate policy. The right hon. Gentleman the Member for Lime-house referred to the possibility of force being the only method of solving this problem at present.
  Mr. Attlee: I would ask the hon. Gentleman not to misquote me constantly. He has misquoted me three times. I stated my position perfectly clearly. What I was envisaging was the position of the world to-day and the question of whether now was not the time to try to draw together all the peace-loving States. I never advocated the use of force at this moment.
  Mr. Butler: I was about to say that the right hon. Gentleman did not accept force as a possibility in dealing with this crisis at the present time. If he had let me finish my sentence I think he would have received the answer to his own question. That leads me to the speech of the Prime Minister, in which he made plain the gravity of the present situation. I have been asked what he meant when he said that no one, whatever his preconceived notions might be, should regard himself as excluded from any extension of the national effort that might be called for. I have been asked whether this signified any intention to introduce some form of industrial conscription or compulsion. The right hon. Gentleman the Member for Hillsborough asked me whether this was intended to introduce any form of military service. I have the Prime Minister's authority for saying that no such intention was in his mind. Indeed, I would remind the House that recently he gave a pledge upon that very point as far as this Parliament was concerned. What he desired to convey was that if the Government decide that an extension or an acceleration of their Air Force programme was necessary, they would, no doubt, have to ask employers and workpeople to accept in the national interest certain inconveniences, and perhaps sacrifices. Obviously any such matters would have to be discussed in the first instance with the accepted representatives of employers and work-
  168
  people. All that my right hon. Friend meant was that in a time when rapid action might be necessary all concerned should abstain from making difficulties and should join in the general patriotic effort. I hope that I have made clear my right hon. Friend's intentions.
  This Debate is, I think, indicative of the determination that lies behind the Government in this crisis. It is impossible at this stage to make any further statement on the subject, because at an hour like this any rapid decision or any hasty words are to be deprecated. Rapid decisions do not always go with the wisest moods. This particular remark about rapid decisions applies, I think particularly, to the questions that have been put to the Government on the subject of Central Europe.
  Mr. Churchill: The Prime Minister said "hasty decisions" not "rapid decisions."
  Mr. Butler: I know that the right hon. Gentleman has a particular power with adjectives and a particular ability in the use of them, and perhaps he can explain to me the difference between "rapid" and "hasty." The decisions of the right hon. Gentleman will always be calculated, and neither of those adjectives could at any time be applied to them. I have had put to me several questions on the subject of our policy in Central Europe. The latest and most succinct statement on this subject was made on 21st February last by the Chancellor of the Exchequer, in reply to a question put to him by the hon. Lady the Member for Jarrow. He said:
  "The obligations of His Majesty's Government towards Austria and Czechoslovakia are those which every members of the League of Nations assumes towards all its fellow members. Apart from these His Majesty's Government have given no special guarantees towards either country."—[OFFICIAL REPORT, 21st February, 1938, col. 8, Vol. 332.]
  I am afraid that I cannot carry the matter further to-night. I hope that the seriousness of the position, as it may be, in Central Europe, will be realised by the determination and the gravity of the speech of the Prime Minister earlier this afternoon, and that that will be an indication of the Government's realisation of the seriousness of the present position and of the dangers which may lie ahead. I think what may have impressed the House more than anything to-night, as was very ably set out in the speech of the right hon. Member for Sparkbrook

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  (Mr. Amery), is the determination in this situation that the nation is ready to be at one in facing any difficulties that may lie before us. Many suggestions have been made towards creating this national unity, and I must again acknowledge the sincerity of the statements in this connection of the right hon. Gentleman the Member for Hillsborough. Perhaps that has been the happiest feature of this Debate—that there is a disposition to look at this problem from a national aspect and to be prepared for a united national effort in case of need.
  I am reminded of some words which were used by William Pitt the Younger, when, in a period not unlike this, he was examining the difficulties and dissensions of politics at the period of the French Revolution. It is rather remarkable that that statement was inspired by the same spirit of non-intervention as inspires His Majesty's Government in the face of another great struggle going on in Spain at the present time. It was in that spirit of earnestness, determination and unhurried reflection, and of a wish for united national effort, that he said in the year 1789—and I think there may be something rather apposite in his remarks in the months that lie ahead:
  "We must endeavour to improve for our security, happiness and aggrandisement those precious moments of peace and leisure which lie before us."
  10.59 p.m.
  Mr. Sorensen: I am fully conscious of the temerity and audacity of daring to speak at this time and in this atmosphere, but however I might desire to remain quiet I must ask the toleration of the House for only a few moments. Whilst naturally I am as deeply conscious as anyone here of the gravity of the situation and can appreciate—
  Mr. Speaker rose—
  Mr. Sorensen: On a point of Order. May I ask whether you have ruled me out of Order?
  Mr. Speaker: The Debate must conclude at 11 o'clock.
  It being Eleven of the Clock, Mr. SPEAKER proceeded, pursuant to Standing Order No. 14, to put forthwith the Question necessary to dispose of the Report of the Resolution.
  Question, "That this House doth agree with the Committee in the said Resolution," put, and agreed to.

  REPORT [1st March].
  Resolutions reported,
  REPORT [1st March].
    CIVIL ESTIMATES AND ESTIMATES FOR REVENUE DEPARTMENTS, AND SUPPLEMENTARY ESTIMATES, 1937.

      CLASS III.
      1. "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, 1938, for the Salaries and Expenses of the Office of the Prison Commissioners and of the Prisons in England and Wales."
      2. "That a Supplementary sum, not exceeding £61,900, 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, 1938, for Grants in respect of the expenses of the Managers of Approved Schools in England and Wales; the expenses of Local Authorities in respect of children and young persons committed to their care; and the expenses of the Councils of Counties and County Boroughs in respect of Remand Homes."

      CLASS VI.
      3. "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, 1938, for the Salaries and Expenses of the State Management Districts, including the Salaries of the Central Office, and the Cost of Provision and Management of Licensed Premises."
      CLASS I.
      4. "That a Supplementary sum, not exceeding £5,000, 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, 1938, for a Grant in Aid of the Government Hospitality Fund."

      CLASS VII.
      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, 1938, for Expenditure in "respect of Art and Science Buildings, Great Britain."
      6. "That a Supplementary sum, not exceeding £7,350, 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, 1938, for Expenditure in respect of Miscellaneous Legal Buildings, including the whole additional cost of a new Sheriff Court House at Edinburgh."
      7. "That a Supplementary sum, not exceeding £81,000, 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, 1938, for the Salaries and Expenses of the Office of the Commissioners of His Majesty's Works and Public Buildings."
      8. "That a Supplementary sum, not exceeding £64,000, be granted to His Majesty, to defray the charge which will come in course

      171
      of payment during the year ending on the 31st day of March, 1938, for Expenditure in respect of sundry Public Buildings in Great Britain, not provided for on other Votes, including Historic Buildings, Ancient Monuments, Brompton Cemetery and certain Housing Estates."
      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, 1938, for Expenditure in respect of Royal Palaces, including a Grant-in-Aid."
      10. "That a Supplementary sum, not exceeding £59,000, 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, 1938, for Expenditure in respect of Customs and Excise, Inland Revenue, Post Office and Telegraph Buildings in Great Britain, certain Post Offices abroad, and for certain expenses in connection with Boats and Launches belonging to the Customs and Excise Department."
      11. "That a Supplementary sum, not exceeding £6,000, 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, 1938, for Expenditure in respect of Public Works and Buildings in Ireland."

      CLASS I.
      12. "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, 1938, for the Salaries and Expenses of the Department of His Majesty's Most Honourable Privy Council."
      13. "That a Supplementary sum, not exceeding £1,850, 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, 1938, for the Salaries and Expenses of the Office of the Lord Privy Seal."

      CLASS III.
      14. "That a Supplementary sum, not exceeding £4,000, 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, 1938, for the Salaries and expenses of the Law Officers' Department, the Salaries and Expenses of the Departments of His Majesty's Procurator-General and of the Solicitor for the Affairs of His Majesty's Treasury, and of the Department of the Director of Public Prosecutions; the Costs of Prosecutions, of other Legal Proceedings, and of Parliamentary Agency."
      CLASS IV.
      15. "That a Supplementary sum, not exceeding £50, 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, 1938, for the Salaries and Expenses of the National Library, including certain Grants in Aid."
      CLASS V.
      16. "That a Supplementary sum, not exceeding £197,000, 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, 1938, for the payment of Old Age Pensions, Pensions to Blind Persons, and for certain Administrative Expenses in connection therewith."
      CLASS VI.
      17. "That a Supplementary sum, not exceeding £50,000, 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, 1938, for Grants to Public Utility Undertakings in Great Britain."
      CLASS VII.
      18. "That a Supplementary sum, not exceeding £308,160, 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, 1938, for Stationery, Printing, Paper, Binding and Printed Books for the Public Service; for the Salaries and Expenses of the Stationery Office; and for sundry Miscellaneous Services, including Reports of Parliamentary Debates."
      CLASS VIII.
      19. "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, 1938, for Superannuation and other non-effective Annual Allowances, 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 for Northern Ireland."
      CLASS VI.
      20. "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. 1938, for the Salaries and Expenses of the Anglo-Spanish, Anglo-Roumanian, Anglo-Italian and Anglo-Turkish Clearing Offices under the Debts Clearing Offices and Import Restrictions Act, 1934."

      REVENUE DEPARTMENTS.
      21. "That a Supplementary sum, not exceeding £900,000, 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, 1938, for the Salaries anl Expenses of the Post Office, including Telegraphs and Telephones."
      Resolutions agreed to.
      The remaining Orders were read, and postponed.

  FOREIGN DEPOSITS (INTEREST RATE).
  Motion made, and Question proposed, "That this House do now adjourn."— [Captain Margesson.]
  11.12 p.m.
  Mr. G. Strauss: I would like to take this opportunity to raise a matter about which I have put several questions to the Chancellor, and to which I have received very unsatisfactory replies. That may not be the Chancellor's fault. I admit that the questions have involved considerable difficulty, and it may not have been possible for the Chancellor, in the course of an answer to a Parliamentary question, to give a reply which was full and satisfactory. But I submit that the point is of substantial importance, and deserves the close interest of the Government, because the financial stability of this country is involved. I maintain—and this view is shared by many experts in the city and many economists of note—that the interest rate paid by the banks, and particularly by the leading bank of the City of London, the Midland Bank, on foreign deposits is having a very serious effect on the balance of payments of this country. The banks of this country, and particularly the bank I have mentioned, pay on deposits which have been put with the bank a very much higher rate of interest than is paid on similar deposits in any other country. On deposits which are placed in Swedish banks one-half per cent. is paid; on deposits in Dutch banks no interest is paid; on deposits in American banks no interest is paid at all for one month, and thereafter only one-quarter per cent.; on deposits placed with Swiss banks a negative interest is actually charged; yet on deposits placed in London, and put with the Midland Bank—because many of the other banks refuse to follow the lead given by this particular bank—interest varying between one per cent. and one and a half per cent. is paid. This money is paid on very substantial sums. I do not know what the foreign deposits of this country amount to—that information is doubtless with the Treasury—but it is unquestionably several hundred million pounds.
  When one seeks the reason why this exceedingly high interest rate is paid on these deposits, one can only come to the conclusion that the Midland Bank is anxious to take the lead in having higher
  174
  deposits than any other bank. Some figures have been quoted with pride of the vast deposits at the Midland Bank. In November, they amounted to over £500,000,000. They have increased since, and there is no doubt that this bank has succeeded in gathering far more deposits within its accounts than any other of the London banks. By doing so it has been doing serious damage to the national interest. It has been doing damage in two respects. This high deposit rate has the effect—not a decisive effect—in attracting to this country foreign deposits which otherwise would not come here; but these foreign deposits necessitate certain actions by the Exchange Equalisation Fund. These actions are sometimes involved, but they invariably lead in the end to raising money on the London market, usually for Treasury Bills, and the taxpayer has to pay the interest on those Treasury bills. The Midland Bank, by paying excessive interest on foreign deposits which come to this country, increases the amount of foreign deposits and necessitate the Exchange Equalisation Fund raising more money thus causing further taxation to be paid by the people of this country in interest on the Treasury Bills raised by the Exchange Equalisation Fund.
  There is something far more important, and I hope the Financial Secretary will deal with this point. The Midland Bank and others who follow their lead pay out on these foreign deposits something in the neighbourhood of £2,000,000 a year which swells the adverse trade balance of this nation at the end of each year. We are paying, roughly, £2,000,000 more than is necessary. If the Midland Bank paid a smaller amount on these deposits, this £2,000,000 would not have to be paid, and the adverse balance at the end of the year would be £2,000,000 less. The action of the bank in this respect is equivalent to reducing our exports by £2,000,000 a year. If it is done as crudely and as bluntly as that, it is quite obvious that this action is having a serious adverse effect on the national interests.
  I do not know with what concern the Government are viewing this matter, but it is being viewed with considerable concern in many quarters in the city. There has been much comment and adverse criticism of this state of affairs.

  175
  Many of the other leading banks of the country have said that they refuse to follow the Midland Bank in this action, and that they consider that the action of the Midland Bank is undesirable and contrary to the national interest. I would like to know whether the Treasury intend using their great influence to bring this state of affairs to an end. If it were in order, one might argue that this action of the bank, which is so obviously contrary to national interests, might be adduced as a very good argument for bringing the whole banking system of the country under public control.
  I am not allowed to advocate legislation on this occasion, but I am entitled to ask the Chancellor of the Exchequer to take such steps as lie within his power, by administrative methods, to bring what appears to me to be a public abuse to an end. No national advantage, no sectional advantage, accrues to anybody by this payment of excessive interest. The bank itself does not gain financially. This additional money which it has to pay out is paid primarily by the customers of the bank, but that is the bank's own affair. I am not worried about that, but I am worried that the action of the bank in this matter is damaging the national interest and increasing our adverse balance of payments by approximately £2,000,000. That is a very serious state of affairs, and one which the Government cannot view with equanimity. We are entitled to ask the Government not only to take action in this matter, but to take action that lies within their power to prevent this bank continuing for its own ends a policy which is doing so much harm to the national interest.
  11.22 p.m.
  The Financial Secretary to the Treasury (Lieut.-Colonel Colville): I followed with interest the questions which the hon. Member asked my right hon. Friend the Chancellor of the Exchequer, and I think I am correct in the assumption, that he desires legislative action, although tonight he said administrative action. There is a different between the two, but at any rate, I am entitled to regard his request as one for direct interference.
  Mr. Strauss: Yes.
  Lieut.-Colonel Colville: First, I think the hon. Member's case is built upon certain assumptions which can hardly be
  176
  justified, according to my information. His first point was that the rate of interest paid on short term deposits is a predominating factor in their location. He indicated that the rate of interest paid by a certain bank or banks was an important factor in attracting deposits to this country. Beyond all question, the most important factor in attracting foreign money here is the confidence felt by persons abroad—
  Mr. Strauss: That was not my case. I said it attracted some little money, but that it is not the dominating factor.
  Lieut.-Colonel Colville: The hon. Member's case was that a certain bank or banks were attracting more money here by giving a certain rate of interest.
  Mr. Strauss: I said it was a factor.
  Lieut.-Colonel Colville: In my view, the predominating factor really is the confidence which foreigners have in institutions in this country including the banking institutions, with which we should be loth to interfere in such a way as to cause a diminution of confidence. Another assumption of the hon. Member is that the high rates of interest, as he termed them, adversely affect our balance of payments. There again, I say that payments of the order of which he was speaking—he has put a figure of his own on them—are relatively small, and could hardly be held to be a serious factor in regard to our balance of payments. In our view, the damage which would be caused by the disturbance of the banking system through direct interference in this case would more than counterbalance any possible disadvantages which there might be in the payment of this money abroad. I am not clear what the hon. Member means by the general term "foreign short-term deposits." Has the hon. Member in mind payments from other parts of the Empire to this country and payments from other countries in the sterling group—it is important to maintain the effectiveness of the sterling group—or has he in mind payments of foreigners' deposits placed with English banks by Dominion banks, or by foreign banks which operate through branches or subsidiaries in London? I do not deny the importance of the complicated questions, of which this is one, which certainly are matters for study by the City authorities. Where I differ from the hon. Member is

  177
  in the emphasis which he lays on this particular factor, and in the need he sees for direct legislative action.
  The general objectives of monetary policy are, of course, a matter for the Government and the central banking authority, neither of whom will hesitate to exercise their influence when and where they deem it necessary. But it is a far cry from this function of general supervision to direct interference, for which I think the grounds on this occasion are not fully proved, in the detailed business of banking, in which I would include not only this, but the choice of assets, the acceptance of liabilities, the structure of interest rates, the rates of different assets to liabilities, and all the other incidents of banking. The sense of direct responsibility under which the British banks
  178
  operate in these matters for the multifarious decisions in their business have made for sound and efficient banking, and I should be very sorry to recommend any step which in any way operated in a reverse direction. Therefore, I say to the hon. Member that I have listened with interest to the points which he has made, that such matters are certainly matters for study by the appropriate authorities, but that I could not recommend on this question a degree of interference which I think would cause more harm than it would do good.
  Question, "That this House do now adjourn," put, and agreed to.
  Adjourned accordingly at Twenty-Eight Minutes after Eleven o'clock.

  INDUSTRIAL DISASTERS (RELIEF FUNDS).
  INDUSTRIAL DISASTERS (RELIEF FUNDS).
  HOLIDAYS WITH PAY.
  HOLIDAYS WITH PAY.
AGRICULTURE.
  POTATOES (STATISTICS).
  POTATOES (STATISTICS).
  HOME-GROWN WHEAT (LEVY ON MILLERS).
  HOME-GROWN WHEAT (LEVY ON MILLERS).
  BARLEY.
  BARLEY.
  VETERINARY SERVICE (AGRICULTURE ACT, 1937).
  VETERINARY SERVICE (AGRICULTURE ACT, 1937).
  HOPS (STATISTICS).
  HOPS (STATISTICS).
  MILK MARKETING SCHEME (ARBITRATIONS).
  MILK MARKETING SCHEME (ARBITRATIONS).
  LIVESTOCK ADVISORY COMMITTEE (WALES).
  LIVESTOCK ADVISORY COMMITTEE (WALES).
CIVIL AVIATION.
  BRITISH AIRWAYS, LIMITED.
  BRITISH AIRWAYS, LIMITED.
  AIR SERVICE, BRITISH WEST INDIES.
  AIR SERVICE, BRITISH WEST INDIES.
TRADE AND COMMERCE.
  COD LIVER OIL IMPORTS.
  COD LIVER OIL IMPORTS.
  WOOD PULP IMPORTS.
  WOOD PULP IMPORTS.
  HIGHLANDS AND ISLANDS (TELEPHONE SERVICE).
  HIGHLANDS AND ISLANDS (TELEPHONE SERVICE).
  WEST AFRICA (NATIVE MINEWORKERS).
  WEST AFRICA (NATIVE MINEWORKERS).
  LOCAL AUTHORITIES, SCOTLAND (TELEPHONE FACILITIES).
  LOCAL AUTHORITIES, SCOTLAND (TELEPHONE FACILITIES).
  PALESTINE (IMMIGRATION).
  PALESTINE (IMMIGRATION).
  CHARITY COMMISSION (RELIEF FUNDS).
  CHARITY COMMISSION (RELIEF FUNDS).
Preamble
The House met at a quarter past four of the clock, The LORD CHANCELLOR on the Woolsack.
GOVERNMENT OF INDIA AND GOVERNMENT OF BURMA ORDERS.

  MESSAGE FROM THE KING.
  THE EARL OF CROMER: My Lords, I have to convey to the House the following Message from the King:
  "I have received your Addresses praying that the Government of India (Governors' Allowances and Privileges) (Amendment) Order, 1938, the Government of Burma (Governor's Salary, Allowances and Privileges) (Amendment) Order, 1938, the Government of India (Adaptation of Acts of Parliament (Amendment) Order, 1938, and the Government of Burma (India-Burma Financial Settlement) Order, 1938, be made in the form of the respective drafts approved by your Lordships' House. I will comply with your request."

AUSTRIA.
LORD SNELL: My Lords, I beg to ask the noble Viscount the Foreign Secretary whether he has any statement to make respecting the position in Austria. I do not propose to run the risk of commenting on those happenings before hearing any statement that His Majesty's Government may be able to make respecting them, and after I have heard any statement that may be made I should wish, in the public interest, to consider carefully before discussing it. At this stage, therefore, I reserve the right on behalf of my noble friends of asking for a debate at a very early date on this most disturbing crisis.
THE MARQUESS OF CREWE: My Lords, before the noble Viscount the Secretary of State for Foreign Affairs replies to the question put by the noble Lord the Leader of the Opposition, I desire to say as few words as possible in what I think has to be considered the most serious situation that has confronted any Government of His Majesty during the last twenty years. I will
46
merely confine myself to saying that I trust confidently that His Majesty's Government will not only, as one feels they are bound to do, continue safeguarding British interests all over the world, but will be prepared—and in this I am sure they will receive the support of all Parties in the country—to maintain so far as is in their power the principles of liberty and of equity all over the Continent of Europe so far as those principles may be threatened in any quarter, and by whomsoever the threat may be made. I agree with the noble Lord in thinking that it would be far better to defer for a short time any fuller discussion of the situation until we have had the advantage of hearing from the noble Viscount opposite—it may not be, I feel, a very great deal—what he is able to tell us to-day.
THE SECRETARY OF STATE FOR FOREIGN AFFAIRS (VISCOUNT HALIFAX): My Lords, I think that the noble Lord opposite and the noble Marquess are no doubt wise in suggesting that it would be more appropriate to defer our debate on the matters before us for a day or two, and I accordingly do not comment at this stage on the general observations that fell from the noble Marquess, which can, perhaps, more properly be examined when we have that debate. The main sequence of events of the last few days will be familiar to the House, but with the permission of noble Lords I will make a statement upon them in fairly full terms. The results of the meeting at Berchtesgaden on February 12 between the German and Austrian Chancellors was stated by the former to be an extension of the framework of the July, 1936, Agreement. Noble Lords will not need to be reminded that that Agreement provided, inter alia, for the recognition of the independence of Austria by Germany and the recognition by Austria of the fact that she was a German State. Whatever, therefore, were the results of the Berchtesgaden meeting, it is clear that the Agreement reached was still on the basis of the independence of Austria.
On Wednesday of last week Herr von Schuschnigg decided that the best way to put an end to the uncertainties of the internal situation in his country was to hold a plebiscite under which the people could decide the future of their country, for which provision is made in the Austrian Constitution of 1934. This

47
decision on the part of the Austrian Chancellor was unwelcome to the German Government, as it also was to the Austrian National Socialists themselves. Matters appear to have come to a head on the morning of March II, when Herr von Seyss-Inquart, who had been appointed Minister of the Interior as a result of the Berchtesgaden meeting, together with his colleague Dr. Glaise-Horstenau, presented an ultimatum to the Chancellor. They demanded the abandonment of the plebiscite and threatened that if this was refused, the Nazis would abstain from voting and could not be restrained from causing serious disturbances during the poll. The two Ministers also demanded changes in the Provincial Governments and other bodies. They required, so I am informed, an answer from the Chancellor before one o'clock in the afternoon.
The Chancellor declined to accept this ultimatum, but he offered a compromise whereby a second plebiscite should be held later with regular voting lists. In the meantime he said that he would be prepared to make it clear that voters might vote for his policy but against him personally, in order to prove that the plebiscite was not a personal question of his remaining in office. Later that day, feeling himself to be under threat of civil war and of possible military invasion, the Chancellor gave way to the two Ministers and agreed to cancel the plebiscite on condition that the tranquillity of the country was not disturbed by the Nazis. There seems to be little doubt that this offer was referred by the two Ministers to Germany. In any event, the reply which they returned was that the offer was insufficient and that Herr Schuschnigg must resign in order to be replaced by Herr Seyss-Inquart. It appears that the Austrian Chancellor was given until 4.30 p.m., Greenwich time, in which to reply and was informed that, if his reply was not satisfactory, German troops would be ordered to move at 5 p.m. This fact seems to show that Germany was behind the ultimatum.
Later in the day a fresh ultimatum was delivered, which appears to have been brought from Germany by aeroplane. The demands made were the resignation of the Chancellor, his replacement by the Minister of the Interior, a new Cabinet
48
of which two-thirds were to be National Socialists, the Austrian Legion to be readmitted to the country and given the duty of keping order in Vienna, and the total readmission of the Nazi Party. A reply was required before 6.3o p.m., Greenwich time. To these demands the Chancellor announced a little later, on the wireless, that he had, in view of the German threatened invasion, yielded in order to avoid the shedding of German blood. He said that he wished the world to know that the President and he had yielded to force and that Austrian troops had been instructed to oppose no resistance to German troops if and when the latter crossed the frontier. The subsequent entry of German troops into Austria and the visit of the German Chancellor to Linz will be known to your Lordships.
His Majesty's Government have throughout been in the closest touch with the situation. I saw the German Foreign Minister on March 10 and addressed to him a grave warning upon the Austrian situation and upon what appeared to be the policy of the German Government in regard to it. In particular, I told him that His Majesty's Government attached the greatest importance to all measures being taken to ensure that the plebiscite was carried out without interference or intimidation. Late on March II our Ambassador in Berlin registered a protest in strong terms with the German Government against such use of coercion backed by force against an independent State in order to create a situation incompatible with its national independence. Such action Sir Nevile Henderson pointed out was bound to produce the gravest reactions of which it would be impossible to foretell the issue. Earlier that day my right honourable friend the Prime Minister made earnest representations in the same sense to the German Minister of Foreign Affairs, with whom I also had two further interviews on that day. To these protests the German Government replied in a letter addressed to His Majesty's Ambassador in Berlin by Baron von Neurath.
I think I should read the terms of that communication in full. They are as follows:
"Monsieur l' Ambassadeur,
"In your letter of March 11th Your Excellency stated that news had reached the British

49
Government that a German ultimatum had been delivered in Vienna demanding the resignation of the Austrian Chancellor, his substitution by the Minister of the Interior, the formation of a new Cabinet with a two-third majority of National Socialist members and the readmission of the Austrian Legion. Should this news be correct the British Government protested against such coercion by force against an independent State in order to create a situation incompatible with its national independence.
"In the name of the German Government I must state in reply that the British Government is not within its right in claiming the rôle of a protector of the independence of Austria. In the course of the diplomatic conversations regarding the Austrian question the German Government have never left the British Government in doubt that the form of the relations between the Reich and Austria can only be regarded as an internal affair of the German people which is no concern of third Powers. It is superfluous to recapitulate the historical and political bases of this standpoint.
"For this reason the German Government must from the outset reject as inadmissible the protest lodged by the British Government, even though only conditional. At the same time, in view of the information quoted in your letter that the Reich Government had made demands of the character of an ultimatum in Vienna the German Government does not desire to omit, in the interests of truth, to make the following statement respecting the events of the last few days:
"A few weeks ago the German Chancellor, recognising the dangers resulting from the intolerable position which had arisen in Austria, initiated a conversation with the then Austrian Chancellor. The aim was to make yet another attempt to meet these dangers by agreement upon measures which should ensure a calm and peaceful development in consonance with the interests of both countries and with those of the whole German people. The Berchtesgaden agreement, had it been loyally carried out on the Austrian side in the spirit of the conversation of February 12th, would in fact have guaranteed such a development. Instead of this, the former Austrian Federal Chancellor, on the evening of 9th March, announced the surprising decision, taken on his own sole authority, to hold within a period of a few days a plebiscite, which having regard to the surrounding circumstances and in particular the detailed plans for the carrying out of the plebiscite, was intended to have, as it could only have, as its purpose the political repression of the overwhelming majority of the population of Austria. This proceeding, standing as it did in flagrant contradiction to the Berchtesgaden agreement, led as might have been foreseen to an extremely critical development of the internal situation in Austria. It was only natural that those members of the Austrian Government who had taken no part in the decision to hold a plebiscite should raise the strongest protest against it. In consequence there ensued a Cabinet crisis in Vienna, which in the course of the 11th of March led to the resignation of the farmer Federal Chancellor and the formation of a new Government.
50
"It is not true that forcible pressure on the course of these developments was exercised by the Reich. In particular the statement subsequently spread by the former Federal Chancellor—to the effect that the German Government had delivered an ultimatum with a time-limit to the Federal President, in accordance with which he was to appoint as Federal Chancellor one of certain proposed candidates and construct the Government in conformity with the proposals of the German Government, failing which the entry of German troops into Austria would have to be contemplated—is pure imagination. As a matter of fact the question of the despatch of military and police forces from the Reich was first raised by the fact that the newly-formed Austrian Government addressed to the Government of the Reich, in a telegram which has already been published in the Press, an urgent request that, for the re-establishment of peace and order and for the prevention of bloodshed, German troops should be despatched as soon as possible. Faced with the directly threatening danger of a bloody civil war in Austria, the Government of the Reich decided to meet the appeal then addressed to it.
"Such being the case, it is completely inconceivable that the conduct of the German Government, as is stated in your letter, could lead to unforeseeable consequences. A general review of the political situation is given in the Proclamation which the Chancellor of the German Reich addressed at noon to-day to the German people. In this situation dangerous consequences could only come into play if an attempt should be made by any third party, in contradiction to the peaceful intentions and legitimate aims of the Reich, to exercise on the development of the situation in Austria an influence inconsistent with the right of the German people to self-determination."
Accept, etc.,
FREIHERR VON NEURATH.
I do not, my Lords, wish to enter into any long argument as regards the historical sequence of events described by Baron von Neurath, but I am bound at once to refute his statement to the effect that His Majesty's Government were not within their rights in interesting themselves in the independence of Austria, and that as, in the opinion of the German Government, relations between Austria and Germany are a purely internal affair, His Majesty's Government, as a third party, have no concern in them. The interest of His Majesty's Government in this question cannot, however, on any tenable ground be denied. In the first place, Great Britain and Austria are both Members of the League, and both were signatories, as was also the German Government, of treaties which provided that the independence of Austria was inalienable except with the consent of the Council of the League of

51
Nations. Quite apart from this, His Majesty's Government are, and must always be, interested in developments in Central Europe, particularly events such as those which have just taken place, if only for the reasons stated by the Prime Minister only a fortnight ago, that the object of all their policy has been to assist in the establishment of a sense of greater security and confidence in Europe, and that that object must inevitably be helped or hindered by events in any part of Europe.
Throughout these events His Majesty's Government have remained in the closest touch with the French Government, and the French Government have, I understand, also entered a strong protest in Berlin on similar lines to that lodged by His Majesty's Ambassador. In the judgment of His Majesty's Government the methods adopted throughout these events call for the severest condemnation, and have administered a profound shock to all who are interested in the preservation of European peace. It follows that what has passed cannot fail to have prejudiced the hope of His Majesty's Government of removing misunderstandings between nations and promoting international co-operation. It might seem unnecessary to refute rumours that His Majesty's Government had given consent, if not encouragement, to the idea of the absorption of Austria by Germany, were there not evidence that these are being sedulously put about in many quarters. There is, of course, no foundation whatever for these rumours. The statement which I have already made shows clearly that His Majesty's Government emphatically disapprove, as they have always disapproved, actions such as those of which Austria has been made the scene.
The attitude of Czechoslovakia to these events is a matter of general interest, and in this connection I can give the House the following information:—The Czech Government have officially informed His Majesty's Government that though it is their earnest desire to live on the best possible neighbourly relations with the German Reich, they have followed with the greatest attention the development of events in Austria between the date of the Austro-German Agreement of July, 1936, up to the present day. I am informed that Field-Marshal
52
Goering on March 11 gave a general assurance to the Czech Minister in Berlin—an assurance which he expressly renewed later on behalf of Herr Hitler—that it would be the earnest endeavour of the German Government to improve German-Czech relations. In particular, on March 12 Field-Marshal Goering informed the Czech Minister that German troops marching into Austria had received the strictest orders to keep at least fifteen kilometres from the Czech frontier. On the same day the Czechoslovak Minister in Berlin was assured by Baron von Neurath that Germany considered herself bound by the German-Czechoslovak Arbitration Convention of October, 1925.

CINEMATOGRAPH FILMS BILL.
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—(Viscount Swinton.)
On Question, Motion agreed to.
House in Committee accordingly:
[The EARL OF ONSLOW in the Chair.]
Clause 1:
Determination of renters' quotas for period beginning 1st April, 1938, and ending 31 st March 1948.
1.—(1) Subject to the following provisions of this Part of this Act, where a renter has, in any renters' quota period, acquired for distribution in Great Britain films which are registered as foreign long films, or has, in any such period, so acquired films which are registered as foreign short films, then unless—

(a) in the first case, …

(b) in the second case, …

the renter shall be guilty of a quota offence, except in a case where either the Board of Trade certify, under the following provisions of this Part of this Act, that his failure to fulfil the relevant conditions imposed by this subsection was due to circumstances beyond his control, or the renter proves that fact to the satisfaction of the court.
(2) For the purpose of paragraph (a) of the preceding subsection, the length of a film shall be taken to be its registered length; but where a film registered as a renters' quota film is also registered as a British long film and also as doubled for the purpose of renters' quota on the ground of its cost, then, subject to the following provisions of this Part of this Act, the length of the film shall be taken for the purpose of that paragraph to be twice its registered length.
LORD STRABOLGI LORD STRABOLGI moved, at the end of subsection (1), to insert "or the Board of Trade has approved, on the advice of the Film Commission, of an order exempting the renter from quota obligations under this Act." The noble Lord said: The Amendment which I have the honour to move to Clause I should be read in connection with the proposed new clause on pages 5 and 6 of the Marshalled List of Amendments and particularly paragraph (g) near the top of page 6. Your Lordships will see that I propose, on page 2, line 31, after a paragraph which deals with the powers of the Board of Trade to make certain concessions to quota renters, to add the words "or the Board of Trade has approved, on the advice of the Film Commission, of an order exempting the renter from quota obligations under this Act." There is little meaning in the Amendment without the further Amendment which I propose after Clause 7. I there propose to insert in the Bill a scheme for a Films Commission. Part of its powers are indicated in subsection (4) (g). I do not mind if your Lordships do not accept my proposal for a Films Commission—the same powers could be conferred on the Board of Trade. Or, if your Lordships would prefer that the Films Council, referred to in Clause 40 of the Bill, should be given these powers, I do not mind at all, as long as I can get this principle into the Bill.
To explain what is in my mind I would draw attention to subsection (4) (g) of the proposed new clause, by which I would empower the Films Commission—or the Board of Trade, it does not really matter for the purposes of my argument—
"to negotiate with any individual renter or group of renters engaged in the distribution of foreign films with the object of drafting a contract for the renting or making of British films, for the approval of the Board of Trade, as provided in subsection (1) of Section one whereby the renter or renters may be exempted from quota obligations under this Act."
The two clauses are knit together, and what I am asking the Government to assent to is the waiving altogether in certain circumstances from year to year of what is known as renters' quota. These circumstances are as follows: That a scheme shall have been agreed whereby these foreign renters, in return for the great privilege of using our market and
54
taking from it in a year between £6,000, 000 and £8,000,000—the second greatest market to them in the world—shall, as we say in Yorkshire, "pay their shot"; that they shall enter into an agreement either to make suitable British films, or to rent for exhibition abroad British films made by entirely British companies. In other words, we get away from all this compulsion of renters' quota and penalties, and we try to make a businesslike agreement with the people who, after all, are the leaders of the cinematograph industry. We in this country have a small promising cinematograph industry, which we are trying to stimulate and build up by this Bill, but it has to be protected; whereas across the Atlantic in particular is a great, powerful, extremely efficient cinematograph industry. If we can come to a suitable arrangement with these highly successful business men who control that American industry to use some of their profits out of the English market for helping our own industry, then I think that would be a very admirable thing.
Your Lordships will notice that this is only permissive. The Board of Trade have to approve, and nothing can be done without their sanction and consent. The two ways in which I suggest that the foreign renting interests might help our industry by agreement are either by making cinematograph films in this country with British labour, or by renting British films to show in their own markets. With regard to the making of films in this country, I would like to see them given a free hand to spend a certain substantial sum of money. Whether they make large pictures or small pictures does not so much matter, as long as there is an honest attempt to make suitable pictures of high quality and high entertainment value. Alternatively, or as part and parcel of the same plan, they could rent suitable British pictures, and really push them in their own markets, and show them in their own theatres, and thus carry British ideas and British art overseas. I believe that something of this kind might be of the greatest value to the cinematograph industry, and you would get away from the idea of penalties and of punishing the foreign film producers for making such attractive pictures for the British public—because that is what it

55
comes to. We have had to have quotas in the past. I think the present Minister for Air was perfectly right in introducing the quota system in the original Bill which we are now amending. But it is not an ideal system. It is rather clumsy and it has had bad effects in the past, as the noble Viscount has himself described to your Lordships; and if we can get right away from it, I think it would be very good for everyone concerned. The exhibitors' quota of course will remain. You have to reserve a certain portion of screen time for British cinematograph films of a suitable quality if you are to give the industry a chance at all. That is untouched. But I believe that this scheme of mine is really worthy of sympathetic attention.
With regard to the way in which I have attempted to draft this far-reaching proposal, I must confess that I did this myself alone a few days ago. I sat up with a wet towel round my head, and I thought the thing out very carefully. I read the old Act and the new Bill and the redrafted Bill, and the wording of the Amendments is mine. If it is not perfect I apologise. I am not a Parliamentary draftsman, but I drew on what experience I had. I think my words do convey the meaning I intended, but if the President of the Board of Trade or the noble Viscount would prefer other words I do not mind a bit, so long as they will carry out what I have in view. This is an attempt to give greater elasticity. It is an attempt to form an alliance with these great, powerful, wealthy interests abroad for the benefit of our own industry in this country. I tried to outline something of this kind during a debate we had in your Lordships' House last April, when I had the privilege of moving a Resolution on the film industry, which your Lordships were good enough to accept. On that occasion I outlined this idea of what I called a trade treaty, and I referred to the same matter on the Second Reading of this Bill. I have therefore had this idea for a very long time in my head, and I think there is something in it. Since I put this Amendment and its allied Amendment on the Order Paper I have had very favourable reactions indeed from prominent members of the British cinematograph industry. They say, "If only we could get something like this it would
56
be most helpful, but it may be too late and it is a pity this was not thought of before." But I have not had any criticism at all. I would particularly ask the noble Viscount not to turn the scheme down holus-bolus. My words may not be the best possible, but in this idea I really think there is the germ of something which may develop into a most helpful scheme for the British industry.
Amendment moved—
Page 2, line 31, at end insert ("or the Board of Trade has approved, on the advice of the Film Commission, of an order exempting the renter from quota obligations under this Act").—(Lord Strabolgi).
THE SECRETARY OF STATE FOR AIR (VISCOUNT SWINTON): I think the noble Lord, in the combination of his speech and the words he has put on the Paper, has made plain what it is he wishes to do. What he wishes to do is in fact to substitute an entirely different Bill for the Bill to which your Lordships gave a Second Reading the week before last. Indeed the noble Lord himself has said that. On the Second Reading he said he had this ingenious idea germinating in his brain, that he thought it was well worthy of consideration, but, he added, "we know it cannot be done in this Bill." I entirely agree with the noble Lord that it cannot be done in this Bill and, frankly, I was rather surprised that he put down an Amendment for that purpose. For observe what it is that the noble Lord is going to ask us to do. The structure of this Bill is a simple one. It is to impose a quota on the renters and a quota on the exhibitors. The renters' quota will always be rather higher than the exhibitors' quota, a very necessary precaution in order to ensure that the exhibitors will always have a sufficiency of films. There are some rather complicated but, I think, wise provisions which enable the renter to count a film of great value as worth more in quota value than a film of smaller value, and there are the provisions which I explained to the House on the Second Reading enabling the renter to acquire the foreign rights in expensive films and to count that as part of his quota obligations.
But observe what the noble Lord is proposing to do. One thing, after all, that has always been laid down with regard to every Act of Parliament is that if you put statutory provisions into a

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Bill you must have certainty. Everybody must know what is the obligations put upon him, what are the rights and what are the duties of a Government Department. Consider what is proposed here. The Bill says, to start with, that every renter has got to satisfy his quota obligation by acquiring a proper and a rising proportion of British films. What the noble Lord proposes is that the Board of Trade, either at its own discretion or on the advice of the Films Committee or Films Council, shall be able to do a deal with a foreign renter to exempt him entirely from any obligation to fulfil his renters' quota by acquiring British films for this country, and to say, "If you make some arrangement by which you will show British films abroad, you shall be exempt altogether from your obligations under the quota." I am not going to argue whether that might or might not be a good thing to do, but I am quite certain that if you carried out that principle the whole of the exhibitors, whose good will is essential to the working of this Bill, would say at once and with one voice—and for once be unanimous—"We do not know where we are under a provision like this. We do not know whether there will be the British films to satisfy our quota, or where they are going to come from."
For these reasons I submit that, while nothing is in a sense out of order in a Bill drawn so widely as this one, it would be utterly without precedent—I would almost say entirely unconstitutional—to give the Board of Trade so wide a discretion as this, defined in no way at all, to put the exhibitors at the risk of not knowing whether there were going to be British films out of which they could fulfil their quota. If I may again quote what the noble Lord himself wisely said on the Second Reading, this may or may not be a good plan, but "it cannot be done in this Bill." Well, my Lords, it cannot.
LORD STRABOLGI: I believe that the noble Viscount began his brilliant career as a debater in the Oxford Union.
VISCOUNT SWINTON: I never spoke in the Union until I had left Oxford.
LORD STRABOLGI: I was never at Oxford myself, but I have also spoken in the Union. His speech was rather
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reminiscent of some of the more brilliant orations I have heard there. I probably said on the Second Reading—I have not looked up my words—that it might be difficult, if not impossible, to put it in this Bill, but I have gone very carefully into the matter and, on looking into the Bill and at the noble Viscount's Amendment on the Paper, I believe it is possible. All I am suggesting is something permissive. The noble Viscount looks at this matter in a much more hostile spirit than I had anticipated, and I am very sorry indeed that it should be so. I was trying to do something constructive, to make the Bill more elastic. I was putting my trust in the efficiency of the Board of Trade. They are capable of knowing what is good for the industry.
What I had in mind is that to-day the only finance available for the industry comes from these same American renters, because they are making a great deal of money. The ordinary channels of finance for British production have dried up. It is no use blinking our eyes to the fact. The ordinary sources of finance have dried up, and the industry is looking for its main sources of finance to these very renters because they have the money. If something of this sort could be arranged, they perhaps could make arrangements with British finance. What is it that people in the City say with regard to British production? "If we were certain there was efficient machinery of production available we would again venture our money." If people who have been tremendously successful in producing films are prepared to put their talent into it, bring their people over here, I think British finance would again be available in conjunction with foreign finance. I am very sorry that the noble Viscount has not seen this. I am certain there is something in it. It would give the elasticity required, and I hope that between now and Report the noble Viscount and his advisers will see whether they cannot find some way of embodying in the Bill what I regard as a valuable I do not propose to press the Amendment now.
Amendment, by leave, withdrawn.
LORD TEMPLEMORE LORD TEMPLEMORE moved, in subsection (2), to leave out "paragraph (a) of." The noble Lord said: This is a

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drafting Amendment, which is necessary to make it clear that both in a case of a long film and a short film the length of the film is to be taken, for renters' quota purposes, as its registered length. Subsection (2) defining the length of a film, refers, as drafted, only to paragraph (a) of subsection (1) which relates to long films. Paragraph (b) of the subsection, relating to short films, is not referred to in subsection (2). By removing the words it is now proposed to delete, the whole of subsection (1) is covered by the definition of length contained in subsection (2), as was intended in drafting the Bill.
Amendment moved—
Page 2, line 32, leave out ("paragraph (a) of").—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE LORD TEMPLEMORE moved, in subsection (2), after "doubled," to insert "or trebled." The noble Lord said: This Amendment and the Amendments on Clause 26 may be considered together because they link up. They are designed to give effect to a promise made in the Standing Committee of the House of Commons to consider giving higher value, for renters' quota purposes, to more expensive films than is done in the Bill as drafted. Thereby the Government hope that films of better quality will be provided. Clause 26 (6) of the Bill as drafted provides that where the total labour costs of a film amount to at least £22,500 and at least £3 a foot it shall count at double its registered length for the purpose of quota. The Amendments add to this principle by providing (within limits indicated later on) that a film with labour costs amounting to £37,500 and £5 a foot shall count at three times its length for the purposes of the renters' quota. An Amendment on much the same lines was moved at the Report stage in the House of Commons, but met with opposition on the ground that it might reduce the number of British films available and therefore make it difficult for exhibitors to meet their quota. It was accordingly withdrawn without prejudice to reconsideration of the matter by His Majesty's Government, and His Majesty's Government have now decided on its reintroduction.
These Amendments provide certain safeguards to meet this contingency. In
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general it may be said that the object is to provide an incentive to those renters who are mainly interested in the distribution of foreign films to acquire as quota against those films British films of high labour cost. This, it is hoped, will assist in the production here of quality films acceptable to the public not only in this country but also abroad to a much greater degree than the less expensive type of film could hope to be. The general idea of the Amendments is supported by the producers in this country and in fact is in their interests. It is a constant complaint against British producers, particularly of the ordinary programme type of film, that they are undersold by the American renters who regard the British films of the ordinary programme type they are required to produce as something in the nature of a tax and have no special incentive to sell them at a profit. To the extent, therefore, that these new provisions induce the American renters to go in for high cost films—and many of them show signs of doing so—this alleged pressure on the small British producer of programme films will be relieved.
It has now been decided that the proposal to grant treble quota in respect of expensive films shall be pursued. The treble quota grant will however be given only in respect of films costing five times the minimum, instead of only four times as was the case when the previous Amendment was moved in another place. A limitation, moreover, is now placed on the degree to which the proposal may operate. This limitation is imposed in order to safeguard the position of exhibitors, who fear that by the operation of the treble quota the number of British films available would be reduced to a serious degree, even though the quality be higher of those films which are made. I might illustrate this proposal by taking the case of a renter who has to acquire 100,000 feet of British film in order to meet his quota obligations. Under the Bill at present in Clause 62 (6), it is possible for him under Clause 3 to acquire the foreign rights of British films with a minimum labour cost of £22,500 up to one-half of his quota obligations. These will be films which are surplus to renters' quota and will, of course, be available to exhibitors through other renters. He could, therefore, by adopting reciprocity, reduce his obligation to 50,000 feet. This obligation he could then meet by acquir-

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ing double quota films of a minimum cost of at least £22,500, and the actual length of film which he can acquire is thus, in the limit, reduced to 25,000 feet, if he acquires all double quota films.
This position will not be disturbed under the Government Amendments dealing with treble quota. The renter will still be able to use the reciprocity clause and in this way reduce his national obligation from 100,000 feet to 50,000 feet. In meeting the remaining obligation of 50,000 feet he can use a combination of single, double or treble quota films in such a way that the actual length of celluloid which he acquires does not fall below 25,000 feet, the minimum which he must acquire under the Bill as it now is. The reduction of the renters' quota period from a year to six months will make it less easy for renters to take advantage of the treble quota concession. It has therefore been provided that whilst the quota must, on the basis of feet of British film to be acquired, be satisfied in each quota period, yet the obligation to provide 50 per cent. of the quota length of British film, by actual physical feet of film acquired may be met in each two renters' quota periods beginning on 1st April. By means of the alterations now made in the original proposal, treble quota will be given to films costing even more than was necessary before—five times the minimum instead of four times—and the total number of feet of films available to exhibitors cannot be less than it might have been under the existing provisions of the Bill. I am afraid I have addressed your Lordships at some length in describing this Amendment, which is rather a complicated one, but I hope I have made it clear to the House. I beg to move.
Amendment moved—
Page 2, line 36, after ("doubled") insert ("or trebled").—(Lord Templemore.)
LORD DARCY (DE KNAYTH): I should like to make clear the position that I and some of my noble friends adopt towards this Amendment. I understand that the desire of His Majesty's Government is to create an incentive for films that should be available to enter the American market. I think I shall not be regarded as being controversial it I state one thing which seems to be quite obvious, and that is that the American market for motion pictures, even to a greater extent than the market in our own
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country, is in fact dominated by American capital, and unless one can get within the orbit of those great American combines it does not matter what value your pictures are, whether they be good, whether they be bad, or whether they be indifferent, they will not be exhibited in that market. Your Lordships may realise after all that where one owns a productive unit in America for the creation of these big pictures, one does not want to make a separate picture solely for the small market in this country; one wants both an Old World and a New World market for the one film; and the slogan "One film, two markets" is a thoroughly effective commercial one, wherever that productive unit is situated.
If one produces a film in this country one wants it to be able to have not only the restricted market of this country but also the other market as well. That is a commercial policy that has led to American capital producing in this country films in excess of the quota cost that is required for this triple quota. There is a film, for instance, now called A Yank at Oxford, which, as far as I can see from the circulars, is attracting an almost complete Cabinet meeting in Leicester Square shortly. I am credibly informed that the cost of that film was £105,000, far in excess of what is required by this quota. I have in my hands a list of twenty-two films produced in the last two years in Britain at that value or at somewhere about that value. They include such things as Rhodes of Africa, Sanders of the River, Catherine the Great, The Ghost goes West, and The Private Life of Henry VIII. I am told that not only are there those twenty-two films, but I am assured that there are a great many more. These are produced actually under the existing system, without any incentive of a triple quota to do it, but only under the commercial incentive of obtaining a double market. There is a further point, that if you encourage the production of these expensive films in this country by people who have not got access to the American market, it means that they are not going to make a success of them, for the simple reason that the restricted market available outside American control in this country is not going to pay for them, and you are encouraging bankruptcies in the industry.
In those circumstances I should like to ask His Majesty's Government in con-

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nection with this Amendment four questions: Why is it necessary to give people privileges to do what they have already an overwhelming commercial incentive to do? Why is it necessary to give privileges to induce people to do what they are already doing without those privileges? Why is it necessary to give privileges to people who are already in such a privileged position that it is necessary to introduce this Bill in order to prevent the complete destruction of the British industry? And why, if you want more pictures produced, do you reduce the incentive to produce them by allowing one picture to count as three? I hope my noble friend will not think I am being captious, but what I do want to say definitely is this: We are anxious about this Amendment, but we think it can be made to work; at any rate we would like to hear what His Majesty's Government have to say about it. We think that it can be made to work by an alteration of the Schedules of this Bill. In those circumstances we propose to ask His Majesty's Government to restore the equilibrium of this Bill, which we think is being somewhat upset. When we come to the Schedules I hope it will not be said, if we do not divide on this Amendment at this stage, that we have conceded the principle and are not therefore to be allowed to raise the matter on Report stage.
LORD MOYNE: I feel it difficult to follow the very complicated calculations which the noble Lord gave us in explaining this Amendment. I do not know whether the limitation of 50 per cent. on the total percentage of footage is going to apply, or whether it is going to be brought down to an even lower figure, but undoubtedly it is an extremely complicated provision. I wish we could have a little more light as to how it is going to work. We were told at an earlier stage of the debates on this Bill that it is very important to keep an exact balance. The quota machinery can be driven to help the foreign producer or to help the home producer. We know that hitherto a very great difficulty in the British film industry has been that under the renters' quota, without any proper safeguard against inferior films, the renter is put against the competition of an uneconomic product which has been sold at a price below the cost of production. I agree with what
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the noble Lord said that it is an advantage if we can induce a greater output of good quota films, knowing that if we do so they are less likely to be sold at an uneconomic price and to depress the market for good British independent films. I am very much afraid that unless we have some adjustment this particular provision is going to throw the whole organisation out of balance.
The President of the Board of Trade said in another place that it was absolutely essential that a balance should be kept in the matter of these quotas, and the noble Viscount the Air Minister told us on the first Amendment this afternoon that if you put statutory obligations into a Bill the one thing you want is certainty. I am afraid that this treble quota is going to introduce a strong element of uncertainty into programmes of the British producers. They will not know until the last moment what demand there will be for independent films. The exhibitors will not know what resources they can call on for fulfilling their quota, and I think it is going to be very unfortunate in its effect on the British producer unless the basic figure which is contained in the Schedules can be put up so as to ensure that the output brought about by the renters' quota is going at least to exceed the requirements of the exhibitors' quota. I do not know whether the noble Viscount can tell us at this stage what he proposes to do on the Schedules, but unless he can correct them and give some readjustment in view of his lowering of the output of the renter, I think we shall have to press very hard, even to the extent of a Division, for better treatment for the producer.
VISCOUNT SWINTON: I sympathise with my noble friend in the inevitable complexity of a clause of this kind. When you try to express in legal language the three times value of something which has to be considered in relation to something else I must admit the finite mind, or my finite mind, gets nearly as confused as it does with my noble friend's questions of privilege with which he bombarded me. But I shall try—I hope I shall do it accurately—to put this in somewhat simpler language. I think we all accepted the point which was dealt with on Second Reading, that it was a good thing that a renter should be able to satisfy part of his quota by films of much

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higher value. In fact, speaking from memory, I think my noble friend Lord Moyne, in the Report of his Commission, actually recommended action along those lines. At any rate I think there was a very strong recommendation that in future legislation we should try to encourage the production of the more expensive film and make as sure as we could that we got away not only from the "quota quickie," which is a despicable animal we all wish to see the last of, but from the very low-priced film in cases where low price connotes a certain lack of efficiency as well as of charm. Therefore I think there was general agreement in the House with the proposal which is in the Bill, that where a film costs three times as much at least per foot to produce as the minimum cost, the renter should be able to count that for something more than the ordinary 7,500 £1 a foot minimum. Therefore there is already in the Bill a provision that where this treble value film is produced a renter may count that twice for a proportion of his quota.
Now I entirely agree with my noble friend that when you introduce a provision like that you do also want to make sure that you are going to have enough films for the exhibitors. I was insistent in my original Bill that you should always keep the renters' quota rather higher than the exhibitors', otherwise you might find that you were defeating your purpose, and that the renters' quota actually fell a little lower than the exhibitors'. But there is already in the Bill the provision that the renter must satisfy at least half his quota by normal lengths. My noble friend will remember that provision. If he will look at the words of the proviso on page 2 of the Marshalled List of Amendments, he will see the words "Provided that a renter," and if he looks on to the end of that paragraph he will see the words "for the purpose of that paragraph, to be the lengths of those films a proportion being less than one-half." That means that the provision is maintained intact to which I alluded on Second Reading, that where those extra value films are being dealt with by renters they must still fill at least half their quota with a normal length of film.
Therefore, if this Amendment is introduced which my noble friend Lord Templemore has moved, it will still be
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subject to the proviso that the renter can only use his extra-value films for half of his quota. Once that basic proviso is understood, it seems to me on the whole to be good sense and good business to say that if a film is produced which costs not three times but five times the minimum value, that should be allowed to be counted by the renter in the other half of his quota for something more than what he can count at three times the minimum value. Your Lordships will see that what is proposed here is that, in order to enable a film of this kind to count for three times its value, it shall not be merely four times the value in cash cost, which was proposed in the House of Commons; it shall be not less than five times that cash cost.
That is, as far as I can appreciate it, a good provision. We all agree that we want to encourage the production of really high-class films. The high-class film inevitably costs, except in very exceptional circumstances, a great deal more money to produce than the ordinary film, and I think that in this way you are giving an incentive to people to produce these high-grade films which will be at least five times the minimum value. That does help to prevent that underselling about which my noble friend Lord Moyne spoke. I feel, therefore, that we are not really taking any risk that the exhibitors will not have enough films to fill their quota under this Amendment. There is still the provision that at least half the quota has to be filled by normal length. But we are—I will not say ensuring, but giving an incentive to, the production of the really high-class expensive film, whether it be by British capital or by foreign capital. For those reasons I think that this provision is sound.
My noble friend put very fairly to me, and I therefore submit it to the House strictly on its merits, the question: If the House agrees to this Amendment, are you going to press us to leave the Schedule of qualities as it is? He is entitled to a perfectly frank answer on that. I think that was involved in my other noble friend's question about privilege, if I followed him aright. I will be, as I always am, quite frank with the House. We do propose, if the House will agree with us, to stand upon the quality Schedules as they are in the Bill. My noble friend is quite entitled,

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if this Amendment is accepted, to advance such arguments as may occur to him—and I have no doubt that they will be forcible—in respect of any Amendment of his to vary the Schedule. But, as at present advised, I have to resist an Amendment of that kind, and I will ask the Committee, on this explanation, which I hope has been reasonably clear, of a complicated matter, to accept this proposal on its merits.
LORD MOYNE: I should be grateful if the noble Viscount would just elucidate those figures a little more, because I am not sure whether we got them quite straight. They seemed to me not quite to fit in with the noble Viscount's very sound principle that the renters' quota should always be a bit higher than the exhibitors' quota. From what he has just told us, only half of the renters' obligation can be satisfied by the triple-counting films; the other half has to be full footage. Therefore, of his obligation there will be half full footage, and one-third of the remaining half will be at one-third I footage.
VISCOUNT SWINTON: Might be.
LORD MOYNE: And the remaining half will be at one-third footage. So you may get a reducing factor on the renters' quota of one-third. In that case the renters' quota, standing in the Bill, as it does, at 15 per cent., goes down to 10 per cent. and is therefore below the exhibitors' quota, which, ex hypothesi and upon the noble Viscount's admission, ought by any sound adjustment of quotas to stand lower than the renters' quota. I do not want to pursue this matter now, but if we let this proposal go by default I trust that the noble Viscount will go into it again and see whether he cannot do something to allay the very serious uneasiness of producers and of exhibitors that this treble quota is going to disturb the whole balance of the Bill and may be disastrous in its effect on British production.
LORD STRABOLGI: This is the most important of the Government's Amendments to the Bill. I therefore rise just to say one word about it, with your Lordships' permission. This is a modification of an Amendment which was moved
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in another place by Mr. Wallace, the Parliamentary Secretary to the Board of Trade, in the absence of the President, who was unfortunately ill. That former Amendment, which was rather different from the one now before your Lordships, was withdrawn, partly because of a tremendous outcry from the independent exhibitors all over the country and partly because of an outcry by the labour unions in the industry. Now the Government have produced this Amendment, which does give a safeguard. As the noble Viscount has explained, half the provision of smaller films remains. Therefore half the quota will be filled with a number of films, the spate of little films, and only the other half can be satisfied by these super-films. Your Lordships will observe that under the Bill already, the so-called double-quota films can be made. This is therefore only an extension, but the same safeguard remains. I should therefore like to congratulate the Government. They have met the situation very fairly. That is borne out by the fact that the exhibitors, who are very well organised, have not attempted, as far as I know, to bring any pressure to bear on your Lordships. They have not made any protest to your Lordships, as far as I am aware, and I am sure that they would have done so. We are not quite so open to pressure from exhibitors, no doubt, as members of another place, but nevertheless I am sure they would have protested if they had not been satisfied—as, in fact, I understand they are.
With regard to the labour objections, I should like again, if I may, to point out that these large films, the triple-quota films, the big, expensive, spectacular films, taking a very much longer time to make, actually will give more employment to labour.
VISCOUNT SWINTON: Yes.
LORD STRABOLGI: I am bound to say that, because on this side of the House we do try, however inadequately, to look after the interests of organised labour, and not least of labour in the film industry. I am convinced, having studied this matter very carefully, that there will be more labour employed in making these large films. Taking the long view, I believe they will do something to raise again the prestige of the British industry, and therefore in the long run will do much

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more to give employment by making the industry sounder and more flourishing. I therefore think we must support the Government on this occasion.
VISCOUNT BERTIE OF THAME: I am not quite sure that the noble Lord opposite is quite correct when he says that more labour will be employed. It seems to me that the stars may get much more pay, and no more labourers will be employed, and they will get the same as they get now.
LORD STRABOLGI: The answer to that question is very simple, if the noble Viscount will allow me to give it to him. It is that the labourer is employed for a much longer time. You can make these little short films in a couple of weeks, but these long films mean months of work. I have seen the actual costing sheets of really large films, big, expensive films, and what is spent on labour is much greater in these long, expensive films. Furthermore, although these long, expensive films only count three for quota, their actual cost is five times as much, so there is plenty of margin for stars.
LORD OLIVIER: If I may, as a mere amateur frequenter of the pictures without knowledge of the operation of studios, say a word with regard to what Viscount Bertie has said, my observation would lead me to suppose that the more stars you employed the more work they would give.
LORD DARCY (DE KNAYTH): I think the noble Lord, Lord Strabolgi, is not quite right in saying that half of the films must be of the type that now count once for quota purposes. The words of the Amendment are: "the aggregate of the lengths which are to be taken, for the purpose of that paragraph, to be the lengths of those films a proportion being less than one-half." The effect of that would be—we will take 1,000 feet as a convenient length—that supposing the quota requirement was 4,000 feet of a particular exhibitor, that could be met without any one-time film. It could be met by two double-times or a three-time and a single time. I would like to say to Lord Strabolgi that I think his point about the extra cost of these films, and the extra labour employed, on the face of it is unanswerable, but in practice it does not work out. It does not work out because
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it is worth while producing a film for two markets if you produce it at all, and these big, expensive films are being made. It is not going to increase the cost or the labour of these films, but fewer of these pictures will be made in this country, and therefore there will be less labour employed.
VISCOUNT SWINTON: I think my noble friend is rather proceeding on the assumption that the whole of the renters' quota is going to be satisfied with these very expensive films. I rather wish I could think so, because it would mean that the whole British industry was going to get on a basis where there was unlimited money, and that very big films would be produced. What will really happen will be that a certain number, probably a small proportion, will be these very costly films, and therefore counting treble for quota, but they will not make very much difference in the aggregate footage available for exhibitors. Therefore, in considering whether there are sufficient films for exhibitors, you do not want to think of one particular renter but of the total output of the whole of the British studios, the whole of which is available for exhibitors. I do not think that in the aggregate there would be the least risk of the total number of renters' films not being materially above the exhibitors' quotas. Always, in fact, the total number of films available has been very much in excess of the minimum requirements in the past. Moreover, the renter has to fill his quota half-yearly, so that is a further insurance to the exhibitors. I am assured that the operation of this provision will mathematically ensure that the same footage of films is available as was available under the Bill with the double value provision in. I am quite prepared between now and the Report stage to go into the interesting mathematical calculation a little more closely, and if necessary to make a statement on Report, but I think this can happen in a sense so rarely, and is so much in the interest of British production and of the exhibitors, who I understand are not opposed to this, that I hope the Committee will accept the Amendment.
On Question, Amendment agreed to.
VISCOUNT SWINTON: The next Amendment is consequential.
Amendment moved—
Page 2, line 39, leave out ("that paragraph") and insert ("paragraph (a) of that subsection").—(Viscount Swinton).
On Question, Amendment agreed to.
VISCOUNT SWINTON: The next two Amendments are also consequential.
Amendments moved—
Page 2, line 39, after ("twice") insert ("or, as the case may be, three times").
Page 2, line 39, line 40, at end, insert—
("Provided that a renter shall be deemed not to have fulfilled the quota conditions imposed by paragraph (a) of the preceding subsection as respects the quota period beginning with the first day of April, nineteen hundred and thirty-eight, or either of the two renters' quota periods falling in the year beginning with the first day of April, nineteen hundred and thirty-nine, or in any subsequent year, if the aggregate of the registered lengths of the films acquired by him in that period or year, as the case may be, for distribution in Great Britain which are registered as British long films and also as renters' quota films bears to the aggregate of the lengths which are to be taken, for the purpose of that paragraph, to be the lengths of those films a proportion being less than one-half.
(3) The Board of Trade, after consulting the Cinematograph Films Council and considering its advice in the matter, may, not later than the end of June in the year nineteen hundred and thirty-eight or any of the eight succeeding years, lay before Parliament the draft of an order directing—
(a) that, in relation to the renters' quota period beginning with the first day of April then next following and in relation to any subsequent renters' quota period specified in the order, this section shall have effect as if for subsection (2) thereof there were substitution the following subsection:
'(2) For the purpose of the preceding subsection, the length of a film shall be taken to be its registered length; but where a film registered as a renters' quota film is also registered as a British long film and also as doubled for the purpose of renters' quota on the ground of its cost, then, subject to the following provisions of this Part of this Act, the length of the film shall be taken, for the purpose of paragraph (a) of that subsection, to be twice its registered length";
(b) that, in relation to the year beginning with the said first day of April and in relation to any subsequent year specified in the order, the proviso to subsection (2) of this section—

(i) shall have effect as if in that proviso for the reference to one-half there were substituted a reference to such other proportion as may be specified in the order, or

(ii) shall have no effect;

and if, not later than the thirty-first day of July next following the date on which the draft of any such order is laid before it, each
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House of Parliament resolves that the order be made, the Board shall forthwith make the order in terms of the draft.
(4) The power conferred by the last preceding subsection to lay in draft before Parliament and to make an order shall be construed as including a power, exercisable in the like manner and subject to the like conditions, to lay in draft before Parliament and to make an order varying or revoking an order having effect by virtue of that subsection.")—(Viscount Swinton.)
On Question, Amendments agreed to.
Clause 1, as amended, agreed to.
Clause 2 agreed to.
Clause 3:
Special provisions with respect to British films rented in foreign countries.
3.—(1) Where, by means of such evidence (including statutory declarations) as the Board of Trade may require, a renter carrying on business in Great Britain satisfies the Board with respect to any film registered under Part III of this Act as a British long film and also as a renters' quota film,—

(a) that the film has been made in Great Britain,

(b) that the total labour costs of the film amount to not less than twenty-two thousand five hundred pounds, and that the quotient derived from dividing the amount of the said total labour costs by the number of feet comprised in the length of the film is a sum of not less than three pounds, and

(c) that in any renters' quota period the said renter has, for a price of not less than twenty thousand pounds, acquired the film for distribution in a foreign country,

the Board may, if they think fit, give directions that the said renter may, for the purpose of fulfilling any relevant quota conditions, count the film as if, at the time when he acquired it for distribution in that foreign country, he had acquired it for distribution in Great Britain, but that the length of the film is to be taken, for the said purpose, to be its registered length; and if and so long as any directions given under this section in respect of a film have effect, no renter shall be entitled to count the film for the said purpose by reason of his having acquired it for distribution in Great Britain:
Provided that if the total length of the films which, by virtue of any directions under this section, a renter is to be deemed to have acquired in any renters' quota period for distribution in Great Britain exceeds half the total length of films registered as British long films which, apart from those directions, he must have acquired for distribution in Great Britain in order to fulfil the relevant quota conditions as respects that period, the first-mentioned total length shall he deemed to be reduced by the amount of the excess.
LORD TEMPLEMORE LORD TEMPLEMORE moved, in subsection (1), to leave out "a renters' quota film" and insert "doubled or

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trebled for the purpose of renters' quota." The noble Viscount said: This series of Amendments to Clause 3 is the outcome of the desire expressed in the Standing Committee of the House of Commons for greater latitude in the provisions for reciprocity or sale of foreign rights. The clause as drafted specifies the total labour costs and the costs per foot which are the criteria for a film to be able to count for renters' quota through the sale of foreign rights. These are, that a film costing not less than £22,500 and £3 per foot in labour may count as equivalent to the acquisition of one renters' quota film on payment of £20,000 for the foreign rights. It is now proposed that whilst, where the film costs at least £37,500 and £5 per foot in respect of labour and/or a payment of £30,000 is made for foreign rights, this will be counted as equivalent to the acquisition of twice the length of the film. As the cost limits mentioned are the same as those for films which under other Amendments on the Order Paper carry respectively double and treble renters' quota through distribution in Great Britain, in accordance with the provisions of Clause 26 (5) as amended, it is simpler to refer in this part of the clause, to films which are available for the reciprocity provisions, as those which are doubled or trebled for the purpose of the renters' quota.
The Amendments include the deletion of condition (a) of subsection (1). Subsection (2) of Clause 26 now more closely defines the meaning of a film made in the United Kingdom. The remaining Amendments are purely drafting Amendments. It is hoped that this Amendment will help the production of quality films which will find a market both here and in America, and lead to American renters arranging with British producers to make such films.
Amendment moved—
Page 4, line 22, leave out from the second ("as") to end of line 23, and insert ("doubled or trebled for the purpose of renters' quota).—(Lord Templemore.)
LORD DARCY (DE KNAYTH): There is one thing I want to ask about this Amendment. In moving it my noble friend did not suggest that this introduced a five-fold quota. I do not suppose that it was intended to do so, but if you look at the Bill and construe it, as far as I can see it can be dissected as follows:
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"Where … a renter carrying on business in Great Britain satisfies the Board with respect to any film registered under Part III of this Act as a British long film and also as a renter's quota film … the Board may, if they think fit, give directions that the said renter may for the purpose of fulfilling any relevant quota conditions, count the film as if, at the time when he acquired it for distribution in that foreign country, he had acquired it for distribution in Great Britain'
and any acquisition of the film by any other renter shall be disregarded. I have tried very hard to get a proper construction of this and I rather think that the word "relevant" must mean relevant to the said acquisition for distribution abroad. The effect of that is that the renter may acquire a film for distribution in this country and count it three times. Then another renter may acquire it for distribution abroad and count it as twice for this country. He himself can do it if he does it through the means of a subsidiary company, but I cannot help feeling that my noble friend does not intend that the Amendment should have this effect. I shall be thoroughly satisfied if he will consult his experts about it, and ensure that that does not take place.
LORD TEMPLEMORE: May I assure the noble Lord opposite (Lord Strabolgi) that every watch and care will be taken on this clause. And may I assure my noble friend Lord Darcy (de Knayth) that what he fears will come to pass is not intended by the Bill. But I will look into the matter.
On Question, Amendment agreed to.
LORD TEMPLEMORE: I beg to move the omission of paragraphs (a) and (b) in subsection (1).
Amendment moved—
Page 4, line 24, leave out lines 24 to 31.—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE: I beg to move.
Amendment moved—
Page 4, line 35, at end insert ("and
"(b) that the said renter has not acquired the film for distribution in Great Britain").—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE: I beg to move.
Amendment moved—
Page 4, line 36, leave out from ("that") to end of line 4 on page 5, and insert ("in determining whether any relevant quota conditions have been fulfilled—

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(i) the film shall (except for the purpose of the proviso to subsection (2) of Section one of this Act) be treated as if, at the time when the said renter acquired it for distribution in that foreign country, he had acquired it for distribution in Great Britain, and

(ii) any acquisition of the film by another renter for distribution in Great Britain (whether before or after the giving of the directions) shall be disregarded.

(2) Any directions given under this section by the Board of Trade shall—

(a) in a case where—

(i) the film to which the directions relate is registered as trebled for the purpose of renters' quota, and

(ii) the Board are satisfied that the price paid or payable by the renter in respect of his acquisition of the film for distribution in the foreign country is not less than thirty thousand pounds,

include a direction that the length of the film shall, for the purpose of determining whether any relevant quota conditions have been fulfilled by that renter in any renters' quota period, be taken to be twice its registered length, or

(b) in any other case, include a direction that the length of the film shall, for the said purpose, be taken to be its registered length.")—(Lord Templemore.)

On Question, Amendment agreed to.
LORD TEMPLEMORE: I beg to move.
Amendment moved—
Page 5, line 7, after ("deemed") insert ("for any purpose").—(Lord Templemore.)
On Question, Amendment agreed to.
Clause 3, as amended, agreed to.
Clause 4:
Exemption in respect of films for which demand is limited.
4.—(1) Upon application made, with respect to a film to which this Act applies, by a renter who has, in any renters' quota period, acquired that film for distribution in Great Britain, or who proposes to acquire it in any such period for distribution in Great Britain, the Board of Trade, if satisfied that the film is a long film and that it has not been exhibited to the public in Great Britain within the twelve months immediately preceding the date an which the application was made, may, if they think fit, direct that, subject to the fulfilment of the conditions set out in the following subsection, the said film shall, for the purpose of determining whether that renter has fulfilled any quota conditions, be disregarded.
(2) The conditions subject to which any directions given under this section in respect of a film shall have effect are that the film must not, in the year beginning with the date of the application upon which the directions are given, be delivered by any other renter to exhibitors in Great Britain for public exhibition therein; or be exhibited to the public at
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more than twelve theatres in Great Britain or at more than six theatres in the administrative county of London, or be exhibited to the public at more than one theatre in Great Britain on the same day; and if the renter delivers the film, after the end of that year, to an exhibitor for exhibition to the public at a theatre in Great Britain, then for the purpose of determining whether any quota conditions have been fulfilled by him, the film shall be treated as if, at the time when he first so delivers it, he had acquired it for distribution in Great Britain.
LORD TEMPLEMORE LORD TEMPLEMORE moved, in subsection (1), to leave out "said film" and insert "fact that he has, before the end of the year beginning with the said date, acquired the film for distribution in Great Britain." The noble Lord said: This Amendment and the next are purely drafting. The clause is designed to meet the case of specialised long films, particularly of Continental origin, which have only a limited circulation here. Subsection (1) provides that a film covered by a Board of Trade direction shall, for the purpose of determining whether a renter has satisfied his quota conditions, be disregarded. The object of the Amendment ment is to make this position more clear.
Amendment moved—
Page 5, line 33, leave out ("said film") and insert the said new words.—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE LORD TEMPLEMORE moved, in subsection (2), after "shall" ["shall be treated"] to insert "(without prejudice to any previous effect of the directions)". The noble Lord said: This Amendment makes it quite clear that, although a renter who at the end of a year of exemption continues to rent the film shall for the future be regarded as subject to quota requirements in respect of the film, yet the necessity to provide quota in the future shall not prejudice the fact of the previous exemption from quota given by the directions issued by the Board of Trade.
Amendment moved—
Page 6, line 6, after ("shall") insert the said new words.—(Lord Templemore.)
On Question, Amendment agreed to.
Clause 4, as amended, agreed to.
Clauses 5 to 7 agreed to.
LORD STRABOLGI LORD STRABOLGI moved, after Clause 7, to insert the following new clause:
Films Commission.
".—(1) With a view to the better organisation and development of the film industry in the United Kingdom, there shall be constituted a Commission to be called the "Films Commission," hereinafter referred to as "the Commission."
(2) The Commission shall consist of a chairman and not less than two or more than four other members who shall be appointed by the Board of Trade. All the members shall be entirely independent of any professional or pecuniary interest in any branch of the cinematograph film industry and shall devote their whole time to their duties as such members.
(3) The functions of the Commission shall be—

(a) to carry into effect and administer the provisions of this Act subject to the overriding authority of the Board of Trade;

(b) to make representations to the Board of Trade and to draft regulations for submission to the Board of Trade in respect of all matters affecting the film industry.

(4) The powers of the Commission shall be—

(a) to make regulations for governing its own proceedings and for delegating so far as may be necessary its functions to certain of its individual members or to its officers;

(b) to prescribe such fees as are laid down in the Second Schedule to this Act;

(c) to hold such inquiries as it considers necessary or desirable, for the discharge of any of its functions;

(d) to recommend to the Minister the initiation of proceedings in respect of infringements of the provisions of this Act;

(e) to set up a viewing panel for the purposes of Section twenty-six of this Act and for examination of films in respect of all applications for registration for renters' quotas;

(f) to recommend to the Board of Trade such alterations or suspensions of quotas as are provided for under Section fifteen of this Act;

(g) to negotiate with any individual renter or group of renters engaged in the distribution of foreign films with the object of drafting a contract for the renting or making of British films, for the approval of the Board of Trade, as provided in subsection (t) of Section one whereby the renter or renters may be exempted from quota obligations under this Act;

(h) to consult whenever necessary with the advisory committee referred to in Section forty of this Act;

(i) to do all such matters and things as are necessary for the exercise of the functions of the committee.

(5) The period of office of members shall be three years subject to re-appointment.
(6) The Commission shall make to the Board of Trade, as soon as may be after the end of the year beginning at the commencement of this Act and each subsequent year, a report of the proceedings of the
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Commission during the year, and a review of the progress of the cinematograph films industry in Great Britain, with particular reference to that branch of the said industry which is engaged in the making of films.
(7) The Board of Trade shall, upon receiving any draft regulations submitted under subsection (4) of this section, forthwith cause the same to be published in the Gazette and in such other manner best adapted to inform the persons affected, a notice of their intention to consider the making of the said regulations. The said notice shall contain—

(a) information of the place where the draft regulations may be inspected and copies thereof obtained;

(b) a statement that the Board are prepared to receive and consider any objection to the proposed regulations which may be made in writing within the period of one month from the publication of such notice.

(8) Within the period of two months from the publication of such notice the Board shall after consultation with the Commission consider any such objections so made and shall make such regulations as they may think proper. All regulations so made shall be laid before Parliament so soon as may be after they are made.
If either House of Parliament within the next thirty days on which that House has sat after there is laid before it any regulation under this section resolves that the regulation be annulled the regulation shall thereupon cease to have effect, without prejudice, however, to anything previously done thereunder or to the making of a new regulation."
The noble Lord said: This Bill is legislating for the British film industry for the next ten years, and I and my noble friends, and my friends in another place, are very disturbed indeed about one part of it, and that is the Films Council mentioned in Clause 40. We support the view of the Moyne Committee that it would be better to have a Films Commission. We think, indeed, that this goes to the very heart of the Bill. The Amendment is in practically the same terms as an Amendment moved in another place by my friends there, with the exception of paragraph (g), which was put in by myself in an attempt to allow for a trade treaty, which the noble Viscount this afternoon declined to accept. So, if the rest of the Amendment were accepted, I would be quite prepared to accept the judgment of the House and cut out paragraph (g). What we have in mind is to have a small whole-time, absolutely independent Committee of men of high position and integrity, who would be adequately paid, and who would give their whole time to their tasks, and their tasks are outlined in my proposals. In

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brief they would administer the Act, watch over the fortunes of the film industry, make reports, make suggestions for future improvements, always under the authority of the Board of Trade and of Parliament. I do not wish to take away any of the powers of Parliament or of the Government Department concerned.
Will your Lordships compare for a moment the British film industry with its great overbearing rival, the film industry of the United States, and see the vast difference between them? In the United States the industry is dominated by eight or nine very large companies who produce films. Some of these great companies, in addition, own great strings of picture houses, some do not, but they all own their own studios, lavishly equipped with the very latest machinery. They therefore start with a solid equity value in this property. They have also got their own renting organisations all over the world. You therefore have these eight or nine large corporations, very well knit together and very efficient and wealthy. They have an organisation in the United States called the Hays Organisation, which is voluntary, and which I understand looks after the censorship in the United States, but it also looks after the general interests of the industry and it imposes a kind of self-discipline on the industry. When the industry wants something from the Federal Government it is the Hays Organisation—Mr. Hays was a very distinguished Senator—which is received by the appropriate Department and puts the views of the industry.
Now what have you here? Compare that with the British industry. You have a number of companies which own cinema studios, which they let out to independent companies for the production of films. The ordinary producing companies have no capital in the form of goods; they have no equity. Some of them have a very small capital. They come into the studios, rent a studio for a certain time, gather together a personnel, and they may be successful or unsuccessful. They do not own theatres. The people who own the theatres in England, broadly speaking, own theatres and nothing else. You have, of course, the great circuits of theatres, and you have two large corporations almost on the American scale, who produce in their own studios, who have their
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own renting organisation, and who have a string of theatres as well. Those are the only two on anything like the American scale of organisation. And then there are other producers going from studio to studio as they can get credits or find space, as the case may be, gathering together their stars and actors as they can. Then you have the independent renters, who are not very strong compared with the American renters, because they have not such a valuable product to offer.
I think the noble Lord, Lord Moyne, and the noble Viscount will agree with me that this smaller and almost infant industry in England is not at all organised as the Americans are. You have no body in this country that can speak for the industry as the Hays Organisation does in the United States. The noble Viscount knows quite well that when this Bill was being drafted, and it was desired to find out the view of the industry, it was most difficult to find out what they wanted. There are five or six conflicting bodies of opinion within the industry diametrically opposed to each other. The President of the Board of Trade in another place, and the noble Viscount here, have said how difficult it has been to get the views of the industry in this country. In this Amendment I and my honourable friends in another place are trying to set up this Commission as recommended in the Report of Lord Moyne's Committee—a small whole-time Commission which will look after the interests of the industry and watch over and study its needs all the time. I hoped that this Commission would have been the people to negotiate across the water with the Hays Organisation and see that British cinematograph films which were worthy had fair treatment in the great United States market and also that the United States industry would co-operate in this country in helping our industry. That is what I hoped, but in any case some such body as this is needed.
Let us see what the Government propose instead. In Clause 40 your Lordships will see they propose this body of twenty-one. I am very glad that some noble Lords on the other side have Amendments on the Paper to cut down this absurd number, this mass meeting, which is proposed. There is to be an independent Chairman. I am glad to see

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that Lord Moyne is proposing a whole-time paid Chairman, and I hope the Government are going to accept that proposal. There is no whole-time paid secretary, but I hope the Government will accept Lord Moyne's Amendment. There are ten other independent members. We do not know who they are. They will come to these Council meetings as and when they like. They have to know nothing about the cinema industry. They cannot do so, because they have to be completely independent of the industry in a peculiar way. They cannot even be shareholders. They are, therefore, the ordinary men and women whom Governments appoint to Committees of this sort—all estimable people, but perfectly useless for the job.
Then we have got ten trade members. Two represent the producers of films, the makers of films. The producing industry in this country is divided into three main camps. First of all there are the people who own studios and let them out. Then there are the people who produce small films, cheap films, "quickies" and so on, to the order of the renters. There are independent producers, who are venturers, who make films, but they are usually small people who borrow to do so from season to season. Over against them you have a third group of very powerful corporations, to which I have already referred, corresponding to the American corporations. They have their own renting organisations, their own theatres, and their own studios. There are two such companies in this country. The interests of these producers are opposed to each other, but these three groups of producers will have two persons on this Council representing them.
Then you have got two people representing the renters. Again the renters are divided. There are the British renters, as they call themselves, who deal in and merchant British films, and there are the renters who deal in and merchant American films. Their interests are opposed, and must be opposed. The renters naturally are opposed in their business interests—they cannot help it—to the producers. They are the middlemen, like the middleman in agriculture, of whom I have heard your Lordships complain. They are also opposed to the exhibitors. Their object is to buy films as cheaply as possible from the producers and sell them as dearly as they can to the exhibitors. They provide two on this
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body. Then there are no fewer than four representing exhibitors. They represent again two different interests, because the exhibitors are divided into the great circuits of, perhaps, one hundred theatres who look at the whole problem quite differently to the small man who owns one, two, or three theatres or manages one, two, or three theatres. You have the independent exhibitors—about 3,000 of them—and the exhibitors who are organised in rings and who represent the remaining 1,000 theatres. Then you have two people representing the persons employed. There are ten representing twenty different sections in this industry opposed to each other. They will be the people who will turn up, of course, at the meetings. Over against them will be the eleven with the eminent Chairman, not even paid. That is the body of twenty-one that is to look after and watch over the interests of a highly-complicated industry which is constantly developing and changing all the time.
That is the Government's proposal—a Council of twenty-one, the mass meeting. What is the Government's case? "Oh, the industry want this Council, and the industry does not want the Commission." I am not so sure. At the beginning, I understand, the producers were in favour of the Commission. I think Lord Moyne will bear me out. I am informed that the producers were in favour of the Commission, and they came into line with others as part of a general bargain to support the Council. I have it all here. Since the noble Viscount stood up at that box on the Second Reading, and informed your Lordships that the whole of the trade was against the Commission proposed by Lord Moyne's Committee, I have made some inquiries and I find they are not all opposed. Many important people in the industry are not opposed to the Commission at all. They tell me that it is possible for the noble Viscount to say these things in the House of Lords because all sorts of people pretend to be speaking for the film industry, and have the ear of the Government, but who in fact do not speak for the film industry but only for their own section of it. They honestly believe they are speaking for the film industry just as the Seven Tailors of Tooley Street believed they honestly represented the people of England. It is not entirely accurate for the noble Viscount—on the advice given to him—to say that

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the whole of the film industry is united against this Commission.
These are the reasons why we think the Commission would be a great advantage over the proposed Films Council. If you like to keep the Council for advisory purposes and hear what they have to say—that is all that will happen in any case—if certain people who have seats on the Council are pleased, let them have their pleasure; but have your Commission and let it he a whole-time body, a small independent body of men of integrity and experience to watch over this industry, which all your Lordships agree is of great importance to the State and of great importance particularly to people of the rising generation. I beg to move.
Amendment moved—
After Clause 7, insert the said new clause.—(Lord Strabolgi.)
VISCOUNT SWINTON: We really have listened to a most astounding speech from the noble Lord who is temporarily leading the Labour Party. What was the burden of his song? These people are small, they are not very rich, so they must not be allowed to come to the Board of Trade. It is only when you get a great plutocratic oligarchy such as you find in the film industry in the United States, able to brief a Senator—it is only a body like that which ought to be allowed to come and advise the Board of Trade and make representations. What a perfectly extraordinary point of view to have expressed from those Benches! With great respect, this matter does not turn on the size or the wealth of the people concerned. It turns on their interest in the business which is their livelihood. The noble Lord said that you have sections in the industry and he described a meeting in which no one member possibly would agree with another. It sounded to me extraordinarily like a meeting of the Labour Party. The noble Lord said that they find it very difficult to agree on a policy. Perhaps that also sometimes happens in other quarters. But quite honestly this is the only thing, it may be, on which they are agreed.
The noble Lord said that he had found some producer who at some stage was prepared to support an independent Commission. I say without any hesitation, on instructions on the information I have received, that after months of negotia-
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tion the one thing on which the industry did present a really united front to the Board of Trade was a plea that they should not be run by a Commission on which they had no representation. As for the story that you cannot get an organisation that represents them, I do not believe it for a moment. I had a good deal to do with this industry when I was framing the first Bill, and I have seen something of it since. If I may take what is far the largest number of these people, the exhibitors, of whom there are something over 4,000 to-day, I never found the least difficulty in getting the views of the exhibitors through the Cinematograph Exhibitors Association. There are also the bodies which came along and represented the renters. But if there be a difference of opinion between one section of renters and another, that seems to me to be a very good reason for having perhaps two renters upon the Board instead of only one. You may get a genuine difference of opinion quite reasonably represented.
Broad and large, what is the proposal? It is that nobody with any interest in or any knowledge of this business shall he on the Council which is to advise the Board of Trade to make the reviews, to say whether the films are coming along satisfactorily or whether the quota ought to be put up or down. I do think that is a most astounding proposal to make. The Board of Trade is to be advised by people who are not only quite impartial but who, by the nature of the case, cannot have any knowledge of the difficulties and the problems of this industry. On the other hand, what the Government propose does seem to me to be a thoroughly practical proposal. It is that you should have a Council with the independent element upon it and also the three interests, producers, renters and exhibitors.
I do not want to say more on this because I dealt with it at considerable length in reply on the Second Reading. Rut I will give just two reasons why I think the Government proposals are absolutely sound. In the first place I think it would be quite unreasonable to have a Committee which, it is true, is not executive but which is to advise the Board of Trade on all the action which it is to take and which is not representative of the industry. I am quite sure that if you had such a body you would

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find there was continual opposition from the industry to this Council, and that would lead to great friction in the working of the Act. You would also find, I am quite certain, that the independent members wanted the advice of the people in the industry, which they will get by sitting together, and if, as is indeed no doubt true, it is very desirable to get independent opinion and independent advice brought to bear upon the people in the industry, you will certainly better do that by having the independent element and the interested element sitting round the table together, facing the problems together and advising the Board of Trade, after such joint consultation, than you will by having an independent Commission merely set up to tell the industry how to do its job. I venture to think that in the Bill we have hit upon a really sound compromise in this matter. I am not ashamed of calling it a compromise, if compromise it be, in that the independent element and the interested element are there together. It seems to me, if I may say so, the only common-sense way of doing it. I hope your Lordships will reject the Amendment.
On Question, Amendment negatived.
Clauses 8 to 14 agreed to.
LORD MOYNE LORD MOYNE moved, after Clause 14, to insert the following new clause:
".—(1) Subject to the following provisions of this section the Board of Trade, after consulting the Cinematograph Films Council and considering its advice in the matter may, not later than the end of June, nineteen hundred and thirty-nine, lay before Parliamet the draft of an Order reducing in relation to long films the proportion prescribed in Part II of the First Schedule to this Act for the year beginning with the first day of October, nineteen hundred and thirty-eight, and if before the end of July, nineteen hundred and thirty-nine, each House of Parliament has resolved that the Order be made, the Board of Trade shall forthwith make the Order in terms of the draft and the Order shall come into operation upon the making thereof.
(2) Subject to the provisions of the next following subsection the Board of Trade, after consulting the Cinematograph Films Council and considering its advice in the matter, may at any time during the year nineteen hundred and thirty-eight, lay before Parliament the draft of an Order reducing in relation to long films the proportion prescribed by Part I of the First Schedule to this Act for the year beginning with the first day of April, nineteen hundred and thirty-eight, and the next succeeding year, and if before the end of the calendar year in which the draft of such an Order is laid before Parliament each House
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of Parliament has resolved that the Order be made, the Board shall forthwith make the Order in terms of the draft, and the Order shall come into operation upon the making thereof.
(3) This section shall not authorise the making of an Order—

(i) reducing the proportion prescribed by Part I of the First Schedule to this Act to a proportion being, in relation to long films, less than fifteen per cent., or

(ii) reducing the proportion prescribed by Part II of the said Schedule to a proportion being, in relation to long films, less than twelve-and-a-half per cent.

(4) As from the coming into operation of an Order under this section altering any of the proportions prescribed by the First Schedule of this Act, that Schedule shall have effect as if it prescribed, instead of that proportion, the proportion substituted therefor by the Order.
(5) In this section the expression 'calendar year' means year beginning with the first day of January."
The noble Lord said: The purpose of this new clause is to give a power to the new advisory body to recommend a reduction in the quota in the case of the first year. The reason that I have put this down is that I am going to move an Amendment when we come to the Schedule, to put the quotas up to the figures of 20 per cent. and 15 per cent., respectively, as recommended by the Departmental Committee. I think, on the analogy of what the Government have proposed for subsequent years, there ought to be a power of remission from the quota for the whole industry if the fears of the Government are fulfilled and any difficulty arises in the general maintenance of the quota figures. I do not think I need really elaborate the details of this clause. It follows the machinery proposed by the Government under Clause 15 and I hope that, with this safeguard against any hardship occurring under the quota, the Government may accede to my Amendment to put the quota up to what the Departmental Committee recommended and not to let the renters off the present level of quota, which they are quite able to maintain. I beg to move.
Amendment moved—
After Clause 14, insert the said new clause.—(Lord Moyne.)
VISCOUNT SWINTON: It is a little difficult to discuss this clause without also discussing the Amendment which my noble friend wants to make to the Schedule, because I think probably if the

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Committee were to agree with my noble friend that the quotas ought to be moved up, then I should probably agree with my noble friend that there ought to be an Amendment here to give the Board of Trade, on the advice of the Advisory Committee, the power to move them down again, which is really what the noble Lord's Amendment would do. Therefore I think, in replying, I am bound to deal with the proposal on its merits, including the Amendment to the Schedule, though I do not of course wish at all to prejudice what my noble friend wants to say when he comes to the Schedule. But I think that would be the position, that if my noble friend's Amendment were carried, probably, though I should ask the Committee not to accept this Amendment now, I might be put in the position of having to move an Amendment on the Report stage.
LORD MOYNE: Perhaps the noble Viscount would prefer me to postpone this until the Report stage; then we shall know how we stand about the Schedule. Perhaps I might reserve my right to move it on the Report stage. I am in your Lordships' hands.
VISCOUNT SWINTON: I am rather inclined to think that would be so. I want to be quite sure that I understand what the noble Lord's proposal is. What he really wants to do is to increase both the renters' and the exhibitors' quota during the first year, to put it up to what I may call the Moyne figure, which is where the Government put it in the second year; but then he realises that, if you do put the quota up like that, it might be difficult of fulfilment, and there ought to be power in the Board of Trade, on the advice of the Advisory Committee, to put it down. I shall argue, when it comes to discussing whether the quota ought to be put up, that that would be an unreasonable thing to do. The power which the Board of Trade take under the Bill, under which after the first year they can either raise or lower the renters' or exhibitors' quota with a tolerance between twenty and thirty per cent., is, I think, the most convenient way of doing it. Probably it would be wise to withdraw the Amendment at this stage, to take the substantive question whether quotas should stand as they are in the Bill or go out when we come to the Schedule, and
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then, whatever decision is come to on that, we shall consider on the Report stage whether any further alteration is necessary. I think that would be better.
Amendment, by leave, withdrawn.
Clause 15:
Power of Board of Trade to alter quotas by order.
(3) This section shall not authorise the making of an order—

(i) altering any of the proportions prescribed by Part 1 of the First Schedule to this Act to a proportion being, in relation to long films, less than twenty per cent. or more than thirty per cent. or, in relation to short films, less than ten per cent. or more than twenty per cent., or

(ii) altering any of the proportions prescribed by Part 11 of the said Schedule to a proportion being, in relation to long films, less than fifteen per cent. or more than thirty per cent. or, in relation to short films, less than seven and a-half per cent. or more than twenty per cent.

VISCOUNT BRIDGEMAN VISCOUNT BRIDGEMAN moved, in subsection (3) (i), to leave out "twenty" and insert "fifteen" and to leave out "thirty" and insert "thirty-five." The noble Viscount said: This Amendment is distinct from the Amendment that follows, and it deals with the renters' quota as distinct from the exhibitors'. It is designed to make the provision more flexible in two directions according as to whether things go well or badly for the producers of British films. If all goes well it may easily be desirable to reduce the renters' quota, for this reason. It may be necessary to protect the producer of British films from a flood of films produced in order to satisfy quota, thereby causing price cutting, which would not be necessary and would not occur if the renters' quota were reduced. On the other hand, optimism might not be justified, and the opposite situation might arise. In other words, it might be necessary to stiffen the obstacle and to raise the renters' quota from thirty to thirty-five per cent. as has been suggested in the Amendment. In making this suggestion I would ask your Lordships to bear in mind that the Moyne Committee envisaged as high a proportion as fifty per cent., and there seems to be no reason why we should bind ourselves to the lower figure and why we should not give a further margin of five per cent. in addition to the thirty which is already provided for in the Bill.
Amendment moved—
Page 16, line 43, leave out ("twenty") and insert ("fifteen") and leave out ("thirty") and insert ("thirty-five").—(Viscount Bridgeman.)
LORD DARCY (DE KNAYTH): I should like to support my noble friend in this Amendment if only because of the extreme complication that this legislation has now assumed. We have got one Act, which has a large number of sections, some of them repealed and some unrepealed, running parallel to the sections of what will be the new Act, and altogether they are producing a position of confusion. I think it is quite clear that it is impossible to deal with a new situation under this Bill in the same way by piecemeal legislation. When a new Act is wanted it will require to be a completely new Act. In those circumstances, I feel that it is very desirable to make provision for a slightly increased flexibility here. The Bill itself provides for a certain amount of flexibility, but we do ask that a slightly greater amount should be given. The reduction might take place as low as fifteen. After all, it is quite easy to envisage circumstances where so many pictures are already being produced that the obligation of American renters to produce more pictures would only result in a fight for the restricted market that was left.
We are asking therefore that a little higher figure should be given and that it should be increased to thirty-five. Under the Bill I think the maximum is twenty-five, but under the clause there is a power to increase that to thirty. We are only asking for five per cent. more. This is entirely permissive. The Board of Trade can use it, but is not compelled to do so. Surely the noble Viscount thinks that the Board of Trade can be trusted to exercise their discretion in a reasonable manner. We are only asking my noble friend if he is prepared to trust his right honourable friend. Of course if le tells me it is impossible, I must accept his answer, but I would like to say that it is not a very big thing that we are asking. It is only asking him to place a five per cent. confidence in his colleague, and I do hope he will be able to go as far as that.
VISCOUNT BERTIE OF THAME: Speaking in the House of Commons on the 23rd February, the Parliamentary Secretary to the Board of Trade said that if circumstances ever arose which would
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justify a renters' quota as high as forty-five per cent. that would necessitate new legislation, despite the fact that the Moyne Committee had mentioned a figure as high as fifty per cent. Why not forestall the possibility of future legislation?
VISCOUNT SWINTON: This is a very subtle appeal which has been made to me. The first part of the appeal I must resist without any hesitation. If I have understood the proposal aright it was a proposal to reduce the renters' quota quite irrespective of a reduction made in the exhibitors' quota. That is as I understand it. I think that would be wholly wrong. I was taken to task, I think by my noble friend Lord Darcy, because he was not sure whether my mathematics were right, and because I was said to be violating my own cardinal principle that the renters' quota must always be kept ahead of the exhibitors' in order to make sure the exhibitors would have enough films to show. I was a little anxious when so attacked, but I am going to stand absolutely firm now in saying that nothing would induce me to accept an Amendment which was going to leave the renter—it may be the foreign renter, too—with a lower obligation than that imposed upon the exhibitor. I think that would cut at the whole basic principle of the Bill. I am sure, on consideration, that my noble friend will not press that part of the Amendment.
My noble friend Viscount Bridgeman and he both made a pleasant appeal saying, would not I trust the Board of Trade with five per cent.? I would trust the Board of Trade with a great deal more than that. My trouble is that my right honourable friend does not want to be trusted in this matter, and, on consideration, it has been felt that to have this pretty wide margin, within which the Film Commission of the Board of Trade, moving like planets, may adjust these quotas to give this range of between twenty and thirty, is probably a wise discretion. It is not a very easy thing to argue, because I cannot say that there is anything in principle between thirty and thirty-five. My noble friend may say: "Well, you need not use the discretion, you may go up to thirty-five per cent. provided always that you keep the renters' quota above the exhibitors'." I do think that is really important. I do not say I attach great importance to

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whether the discretion and measure of tolerance is put at thirty or thirty-five, but I should not like to concede that. I would ask the House to accept these tolerance margins, which have been very fully considered.
Let me point out this. It is irrelevant, when one comes to consider the figures that ought to be put into quotas, whether they are in the Schedule or in a discretionary power which is given. Your Lordships will remember that these are minimum requirements, something that every single exhibitor has to carry out. There are 4,000 exhibitors. Broad and large, they have played the game extraordinarily well under the ten years of what I may call my Act. It has not been at all easy for them. It has been much easier for exhibitors in some places to get the necessary films than in others. There is the whole question of circuits. Films are shown in the first-class circuit first of all, and it is difficult in the second-class circuit to get them for a long time. Good will is everything in this Bill, getting the good will of the exhibitors to show the right number of films. If there are good films offering, I have not the least doubt that they will show more than their minimum obligation. But you might put a great hardship upon them. You might have failures of the kind of which there have been a good many already: failures to comply with quota which on investigation the Board of Trade found were not in the least criminal and were not even negligent, but cases in which the exhibitors could not reasonably get hold of the films. You do not want to get a great many of these cases. It is much better to have a quota of twenty-five or thirty per cent., which every exhibitor in this country can fill, than to put the quota up to thirty-five and then find that there are 500 or 600 exhibitors who have to come to the Board of Trade and say, "I could not fill this." Therefore I would ask your Lordships to accept the figures, which have received great consideration, as they stand in the Bill. We all want to see the greatest possible number of films; we all believe in the need of good will in this matter; and on the whole I believe that we shall get better and probably more British films shown in the long run if we leave the margin of tolerance where it is.
On Question, Amendment negatived.
VISCOUNT BRIDGEMAN VISCOUNT BRIDGEMAN moved, in subsection (3) (ii), to leave out "less than fifteen per cent. or more than thirty per cent." and insert:
"In respect of the period set out in paragraph (a) of subsection (2) of this section less than seventeen and a half per cent. or more than twenty-five per cent.;
In respect of the period set out in paragraph (b) of subsection (2) of this section less than twenty per cent. or more than thirty per cent.;
In respect of the period set out in paragraph (c) of foregoing subsection (2) of this section less than twenty-five per cent. or more than flirty-five per cent."
The noble Viscount said: This Amendment is quite distinct from the last Amendment, and deals with exhibitors' quota. Under Clause 15 as at present drafted, it would be perfectly possible for the Board and for the Films Council to go on saying, each time these figures were due for review, that the quota should stay at fifteen per cent.—that is to say, the lowest figure in the Schedule Equally, unless I am very much mistaken, it would be possible for the Board and the Council, having raised the quota to a higher figure at one period of review, to reduce it again at the next. It seems to me perfectly clear as a matter of principle that an assurance should be given in the Schedule to the Bill that the intention is that the exhibitors' quota should rise progressively. It should not, whatever happens, go backward. But under the clause as now drafted it seems perfectly possible that the quota could stand still for the whole term of operation of the Act, or even that there might occur an Irishman's rise—in other words the quota, having gone up, then goes down. Elasticity is a virtue much to be desired in this Bill, seeing how little we know what the future may bring. But elasticity must be combined with a reasonable certainty for the producers and for those who find the money for the producers, not to speak of all those who work in the film industry, that the progress of British films—in other words, the rise of the quotas—if not fast is at least continuous. As the clause now stands, it looks to me as though there is no safeguard that that will happen.
With this uncertainty hanging over the whole film industry for the ten years, do you not think that far too much time is going to be taken up by the best brains of the industry in engaging in fights as

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to whether the quota shall be or shall not be raised? Do you not think that we are liable to have what is certain to be called sooner or later the "quota front," that quota front being in Whitehall, and the industry distracted from its proper business, which is the production of British pictures? The figures which are down in the Amendment are not unreasonable figures. They correspond pretty closely with the figures already in the Schedule, and the top figure, thirty-five per cent.—as I ventured to say in discussing the last Amendment—is still fifteen per cent. below the highest point which the Moyne Committee envisaged the production of British films might reach, namely, fifty per cent. I hope that this matter may be favourably considered from the standpoint of giving the film industry some certain indication of what is going to happen in the next ten years. I beg to move.
Amendment moved—
Page 17, line 5, leave out ("less than fifteen per cent. or more than thirty per cent.") and insert the said new words.—(Viscount Bridgeman.)
VISCOUNT SWINTON: My noble friend has moved this Amendment, as he puts it, in the hope of securing greater certainty. Quite frankly, however, I do not think it would do that. If he wants certainty—that is to say, that everybody, whether he be a producer, renter or exhibitor, shall know precisely where he stands—then the only thing to do is to put in our Schedule an absolutely flat quota provision which says it shall be so much in the first year, so much in the second year, and so much in the third year. That was exactly the provision under the old Act, and it was because experience under the old Act showed that it was desirable to have a discretionary power—subject always to Parliamentary sanction—either to increase the quota if the industry forged ahead or to lower it if the industry was not successful enough to carry out the measure of growth which had been anticipated, that this discretionary power was brought into being.
You therefore have to choose between the absolute statutory power which cannot be altered and the discretionary power. He himself agrees, by virtue of his own Amendment, that he accepts the desirability of the discretionary power, but he wants to limit the discretion of the
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Board of Trade and the Council by saying that, as you go forward through progressive periods, you should be limited with one margin of tolerance, we will say, in the first three years; then you move up. You can only go, say, from eighteen to twenty or twenty-five in the first period, and then it must be from twenty to thirty in the next period. What would he do if, quite sincerely, it was found by common consent that the industry was not producing enough films during the second period to fulfil the minimum we have laid down? The only thing you could do would be for the Board of Trade to give wholesale exemptions to exhibitors from showing the requisite number of films. I think you will all agree that that is a very undesirable way of working the Act. We want the Act to be so constructed that everybody can conveniently and with good will carry out the obligations. For those reasons I think there ought to be that full discretion in the Films Council and the Board of Trade to move up or down in each period, within the general powers which are given. I submit that it is wiser not to limit the discretion of the Commission and the Board of Trade in the way the noble Viscount proposes.
There is one other point. The noble Lord expressed some anxiety that, although the Schedule of the Act lays down a steadily rising quota for both renter and exhibitor, the Films Commission might say: "Notwithstanding what is in the Schedule we propose to keep the quota at fifteen or twenty per cent. for the whole period of the Act." That would be entirely under Parliamentary control. The statutory quota is going to be the figures laid down year by year in the Schedule, which has got to be carried out by renter and exhibitor, year by year, unless Parliament itself, by Order, on the advice of the Commission, thinks fit to vary it. Parliament will have it under its own control, and the Commission can only advise the Board of Trade to vary it if it is satisfied that it is impracticable for the industry to carry out what Parliament has laid down.
VISCOUNT BRIDGEMAN: After what the noble Viscount has said I will not press my Amendment, but I hope we may take it that what he has said is a general indication of what the policy of the Government will be—namely, to keep

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the quota proportion laid down in the Schedule gradually rising—and that that will be the way in which the Government and the Board of Trade will exercise the powers given in the Bill after it becomes law.
Amendment, by leave, withdrawn.
Clause 15 agreed to.
Clause 16:
Reduction of exhibitors' quotas for year ending 30th September, 1938.
16. The First Schedule to the Act of 1927 shall have effect, and be deemed always to have had effect, as if the proportion prescribed by Part II of that Schedule as respects the year ending with the thirtieth day of September, nineteen hundred and thirty-eight, were fifteen per cent. and not twenty per cent.
LORD MOYNE LORD MOYNE moved to leave out Clause 16. The noble Lord said: This is a very curious clause, of a retrospective character. The renters' year ends on March 31, but the exhibitors' year only ends on September 30, so that under the existing Act the exhibitors have still another six months which is covered. When the noble Viscount introduced his Bill more than ten years ago he anticipated that it would be perfectly reasonable to work by a quota for both renter and exhibitor of twenty per cent. up to the end of the term covered. There has really been a very strong bear movement in the quota market, and for some reason, hitherto unexplained, the Government seem to have capitulated to those who are agitating to whittle away the protection and encouragement which it is the main object of this legislation to give to the producer. I think it is going to be deplorable if we put these quotas lower than we can maintain in the interest of the producer.
There is no evidence whatever on the figures that there is going to be any difficulty to the exhibitors to fulfil the quota which they expected to fulfil for the last six months of the expiring Act. The renters have fulfilled their twenty per cent., and the exhibitors' quota necessarily hinges to some extent on the renters' quota. There seems to be no case whatever why, having turned the tap on to a certain volume for the renter, you should suddenly restrict it when it comes to the exhibitor. There is no shortage of films. During the last eleven months the total of long films registered was 706. Of these 180 were British films,
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so that the British output was 25 per cent. of the whole. That is well beyond the exhibitors' obligations. Besides that it must be remembered that the exhibitor has exactly the same margin of choice in the foreign films offered as he has in the British films—exactly the same ratio of choice—and clearly if we pass this clause to reduce the quota of the exhibitor for the last six months we shall prejudice the maintenance of a reasonable quota under the full operation of the Bill which we are now discussing, because if we are going to jump off from a lower level than the existing Act contemplated, obviously we cannot get up to as high a quota as we hoped to do. I trust the noble Viscount will therefore see his way to accept my Amendment, and show that he was not wrong in fixing the exhibitors' quota in the last six months at twenty per cent.
Amendment moved—
Leave out Clause 16.—(Lord Moyne.)
LORD ASKWITH: I would like to support my noble friend Lord Moyne in his Amendment to omit this clause. It seems to me that it brings in an element of uncertainty, which the noble Viscount has expressly said (and I agree with him) it is one of the objects of the Bill to remove. To my mind the clause is uncertain, unfair and, what is more, unwise. It is uncertain in the sense that there has been created a vested interest, and that vested interest is suddenly interfered with by a clause put into this Bill. Therefore it creates a certain feeling of uneasiness, which is very undesirable. Then it must be very unfair, because the renters, having spent money and engaged operators and employees of various kinds and got their films ready, are suddenly told that the exhibitors' quota is not to be the same, but is to be cut down. They had been expecting that it would be twenty per cent. They have been expecting this protection under an Act of Parliament, and suddenly they are told they cannot have it. In my opinion and experience a retrospective action of this kind is most unwise. I have seen it in arbitrations of different kinds between labour and capital, and wherever it has occurred, wherever there has been a retrospective award, it has caused a lot of vexation, uneasiness and had feeling, which the little advantage that it may possibly give is not worth. It is not worth while having this clause in

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the Bill. It is a most undesirable clause in every way, and I support its rejection.
VISCOUNT BERTIE OF THAME: Such respectable papers as The Times cry out against the quota being reduced. On February 24 The Times said:
"The need now is to restore the optimism inspired ten years age, by the prospect of a substantial sheltered market for British films. The City is not likely to think that market substantial if the exhibitors' quota is less than twenty per cent."
The City is the place where the money comes from, and if the City is not satisfied with the quota the whole industry may be ruined. It seems to me, if I may say so without offence, that the proposal in this clause is sheer madness, without the redeeming feature of any method. It is playing into the hands of foreigners. The Financial Times on February 28 said this:
"The second point which the Lords should consider is the more technical one of the quota in the first year of the Act, Under the old Act the quota is twenty per cent., but in the twelve months starting 1st April, 1938, the renters' quota for long films is to be fifteen per cent., and the exhibitors' quota twelve and a half per cent. Mr. Stanley has stood firmly by these figures throughout the discussion of the Bill, but in the Report stage he indicated that they might be changed in the Upper House. It is to be hoped that they will be."
Well I hope that that is a true prognostication of what is going to take place.
This morning in the Financial Times there were some very caustic and telling remarks. This is what the paper says:
"The question is whether the protection ensured so far by the 1927 Quota Act has been effective, and whether that envisaged by the present Bill is likely to be any more so. Under the 1927 Act, the quota rates for the year ending 31st March are twenty per cent. for renters and exhibitors alike. Under the proposed new Act the rates are fifteen per cent for renters and twelve and a half per cent. for exhibitors, and the latter will not rise to twenty per cent. again until 1942. For the immediate future, then, the field of protection has been noticeably reduced. … In fact, the main disadvantage of the quota in the past was that it was insufficiently protective of the British producer. The operation of twenty per cent. quota rates for exhibitors has been severely circumscribed in actual practice, first by the technical difficulties of film production, and, secondly, by the renters' overruling interest in Hollywood films."
We do not want to be ruled by Hollywood, and therefore I support the Amendment.
VISCOUNT SWINTON: My noble friend (Lord Moyne) made an appeal to me, which I find it difficult to resist, that I should stand by my own Act, and say that the quota provisions I put into it ought to be fulfilled. The last thing in the world I want to do is to reduce a quota if it is not necessary to do so, but I must put to the Committee the very strong advice on this matter which I have from the Board of Trade, and that is that if we kept the quota at twenty per cent. for the exhibitors in the last part of the exhibitors' year, it would not be possible in their opinion for them to acquire up-to-date and suitable films sufficient to discharge their obligations, and that one of two things would happen. Either there would be a very large number of defaults, in respect of which the Board of Trade would either have to prosecute (and they, of course, would not prosecute if they thought the default was reasonable) or they would have to give a very large number of exemptions—a bad thing to do. The alternative to that would be that exhibitors would go out into the highways and collect the indifferent British films—"quota quickies" and the like—in order to discharge their legal obligation.
That would be bad for the exhibitors, because certainly it would make their houses unpopular; and, above all, it would be bad for British films because nothing has done so much harm to British films, or done so much to prejudice the success of the Act—it did succeed pretty well but the complete success of the Act was prejudiced—as the "quota quickie" and the bad film. We should do a terrible disservice to the British film industry at the outset of this new period, which we hope will be a period of advance, if we started with an obligation which compelled the exhibitors either to default or to show had British films. I naturally cannot profess to have firsthand knowledge of what will be the number of films forthcoming, but that is the responsibility of the Department which has been administering this Act for ten years, and I think that if they advise that the exhibitors would have a very genuine difficulty—in fact, they put it so high as to say impossibility—in getting suitable films to exhibit in their cinemas if this figure were maintained, then I feel bound to ask your Lordships to reduce my

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twenty per cent. figure to the more modest fifteen per cent. in this clause.
Resolved in the negative, and Amendment agreed to accordingly.
Clauses 17 to 24 agreed to.
Clause 25 [Determination of films to be treated as British films for purposes of registration]:
LORD TEMPLEMORE: The Amendment to this clause is purely a drafting Amendment. The clause as it now stands requires that in the case of a British film the studio used in making the film "is" within His Majesty's Dominions. The Amendment would require that the studio used in making the film "was" within His Majesty's Dominions—that is, at the time of making the film, which, of course, was what was intended by the clause.
Amendment moved—
Page 23, line 20, leave out ("is") and insert ("was").—(Lord Templemore.)
Clause 25, as amended, agreed to.
Clause 26:
Conditions governing registration of British films as quota films.
(2) A film registered under this Part of this Act as a 13ritish film shall not be registered as a renters' quota film unless—
(b) the studio, if any, used in making the film is within the United Kingdom, and
(6) Where, in the case of a film registered under this Part of this Act as a British long film and also as a renters' quota film,—
On Question, Whether the clause proposed to be left out shall stand part of the Bill?
Their Lordships divided:—Contents, 15; Not-Contents, 27.

CONTENTS

Bath, M.

Vane, E. (M. Londonderry.)

Fermanagh, L. (E. Erne.)

Gage, L. (V. Gage.) [Teller]

Bessborough, E.

Swinton, V.

Luke, L.

Fortescue, E.

Strathcona and Mount Royal, L.

Lucan, E. [Teller]

Clanwilliam, L. (E. Clanwilliam.)

Munster, E.

Templemore, L.

Stanhope, E.

Cottesloe, L.

NOT-CONTENTS

Aberdeen and Temair, M.

Addington, L.

Hindlip, L.

Askwith, L.

Holden, L.

Onslow, E.

Balfour of Burleigh, L.

Moyne, L.

Poulett, E. [Teller.]

Cornwallis, L.

Rankeillour, L.

Darcy (de Knayth), L. [Teller.]

Saltoun, L.

Bertie of Thame, V.

Snell, L.

Bridgeman, V.

Doverdale, L.

Strabolgi, L.

Chaplin, V.

Fairfax of Cameron, L.

Teynham, L.

Chelmsford, V.

Gorell, L.

Waleran, L.

Exmouth, V.

Harris, L.

Wolverton, L.

On Question, Amendment agreed to.

(a) the total labour costs of the film amount to not less than twenty-two thousand five hundred pounds, and

(b) the quotient derived from dividing the amount of the said total labour costs by the number of feet comprised in the length of the film is a sum of not less than three pounds,

the film shall be registered as doubled for the purpose of renters' quota:
Provided that it shall be the duty of the Board of Trade to ensure that, if and so long as any directions of the Board under Part I of this Act by virtue of which the length of such a film as aforesaid is to be taken to be its registered length have effect, no statement that the film is doubled for the purpose of renters' quota appears in the register.
LORD TEMPLEMORE LORD TEMPLEMORE moved, in paragraph (b) of subsection (2), to leave out "is" and insert "(exclusive of any portion of the film which, by virtue of subsection (3) of the last preceding section, is to be treated as not forming part of the film) was." The noble Lord said: This is really a drafting Amendment.
Amendment moved—
Page 25, line 40, leave out ("is") and insert the said new words.—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE: The next Amendment is consequential.
Amendment moved—
Page 27, line 21, after ("pounds") insert ("but to less than thirty-seven thousand five hundred pounds").—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE: The next Amendment is also consequential.
Amendment moved—
Page 27, line 25, after ("pounds") insert ("but of less than five pounds").—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE LORD TEMPLEMORE moved, in subsection (6), after "quota," immediately preceding the proviso, to insert:
"and where, in the case of a film registered as a British long film and also as a renters' quota film,—

(i) the total labour costs of the film amount to not less than thirty-seven thousand five hundred pounds, and

(ii) the quotient derived from dividing the amount of the said total labour costs by of feet comprised in the length of the film is a sum of not less than five pounds,

the film shall be registered as trebled for the purpose of renters' quota."
The noble Lord said: This is Amendment.
Amendment moved—
Page 27, line 27, after ("quota") insert the said new words.—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE LORD TEMPLEMORE moved to leave out the proviso in, subsection (6). The noble Lord said: This proviso required that, although in the case of an expensive film costing at least £22,500 for labour, the film could count double for renters' quota purposes, nevertheless if, in respect of that film the Board have given directions under Clause 3 enabling the foreign rights to be sold for renters' quota purposes, the register of films should not contain a statement that the film counts double for the purpose of renters' quota. This was required because the reciprocity conditions attaching to a £22,500 film give only single renters' quota. The new provision whereby a firm which costs at least £37,500 for renters' quota purposes and £5 per foot may count double for the purposes of the renters' quota under reciprocity conditions, and also treble for renters' quota under the ordinary conditions of distribution of the film in this country, would require a further complex alteration of this proviso. It is considered that, on the whole, it is unnecessary for the complicated proviso which would result to be in the Bill: the matter of marking the register to indicate that a film registered as double or trebled had later become subject to the reciprocity
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provisions is one which could be dealt with administratively by the Board of Trade without special provision in the Bill. The proviso, being unnecessary, has accordingly been deleted.
Amendment moved—
Page 27, line 28, leave out lines 28 to 34.—(Lord Templemore.)
On Question, Amendment agreed to.
Clause 26, as amended, agreed to.
Clauses 27 to 33 agreed to.
LORD STRABOLGI LORD STRABOLGI moved to insert after Clause 33:

PART IV.
PROVISIONS AS TO PERSONS EMPLOYED BY MAKERS AND PROCESSORS OF FILMS.
Wages and conditions of employment of persons employed by makers and processors of films.
.—(1) The wages paid by any person carrying on in Great Britain the business of a maker or processor of films to persons employed by him in connection with that business, and the conditions of employment of persons so employed, shall, unless agreed upon by the employer and by organisations representative of the persons employed, be not less favourable to the person employed than the wages which would be payable, and the conditions which would have to be observed, under a contract which complied with the requirements of any resolution of the House of Commons for the time being in force applicable to contracts of Government departments: and if any dispute arises as to what wages ought to be paid, or what conditions ought to be observed, in accordance with this section, it shall, if not otherwise disposed of, be referred by the Board of Trade to the industrial court for settlement.
(2) Where any matter is referred to the industrial court under this section, the court, in arriving at its decision, shall have regard to any determination that may be brought to its notice relating to the wages or conditions of service of persons employed in a capacity similar to that of the persons to whom the reference relates, being a determination contained in a decision of a joint industrial council, conciliation board or other similar body, or in an agreement between organisations representative of employers and workpeople.
(3) Where any award has been made by the industrial court upon a dispute referred to that court under this section, then, as from the date of the award or from such later date as the court may direct, it shall be an implied term of the contract between the employer and workers to whom the award applies that the rate of wages to be paid, or the conditions of employment to be observed, under the contract shall, until varied in accordance with the provisions of this section, be in accordance with the award."
The noble Lord said: In another place this Amendment was down in the name of some of my honourable friends, and it

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would have been accepted then, but it was out of order because in another place the title of the Bill could not be altered. This is a good example of the elasticity of the rules of your Lordships' House. I understand the Government are going to accept the Amendment, and they were kind enough to give me advice on the drafting. There is only one small point I wish to raise and that is whether it is necessary to include "processors" so as to cover workers in laboratories. On the Second Reading the noble Viscount said he left out the different people employed in the theatres who are separately dealt with, but I am asking to include makers and processors. If the Government prefer not to have "processors" in and assure me that "makers" includes them, I shall be perfectly content.
Amendment moved—
After Clause 33, insert the said new clause.—(Lord Strabolgi.)
LORD TEMPLEMORE: The development of the cinematograph films is undertaken by some studios on their own premises, and to the degree that that is done their employees engaged in processing the film would be covered by the clause which the Government promised to accept. In so far, however, as processing of a film is done at outside laboratories not owned by the film maker, clearly no control over wages and conditions of employment can be exercised by the film maker. Such outside processors perform other duties than developing films—for example, all kinds of photographic work, and there is no logical reason why the clause should not extend to makers of raw stock. In these circumstances we would prefer not to include the word "processors."
LORD STRABOLGI: I presume we should put an Amendment down in that case on the Report stage, and that this Amendment should pass now on that understanding.
On Question, Amendment agreed to.
Clause 34:
Films to which Act applies.
34. The films to which this Act applies are all cinematograph films other than—
(a) films consisting wholly or mainly of photographs which, at the time when they were taken, were means of communicating news or were of special interest by reason of their relation to topics of the day, or
LORD TEMPLEMORE LORD TEMPLEMORE moved, in paragraph (a), to leave out "or were of special interest by reason of their relation to topics of the day." The noble Lord said: This Amendment is the result of further consultation with the makers of news reels as to the best definition of "news reels" for insertion in the Bill. The words which it is proposed to delete would, it has been found, in some cases include specially-acted films of fictional form relating to matters of topical interest. It is not desired that any such films should be excluded from the scope of the Bill. By limiting the definition in the way which is now proposed, paragraph (a) will exclude from the scope of the Act films which are simply and solely news films, within the commonly accepted meaning of that term.
Amendment moved—
Page 30, line 24, leave out from ("news") to ("or") in line 26.—(Lord Templemore.)
On Question, Amendment agreed to.
Clause 34, as amended, agreed to.
Clauses 35 to 39 agreed to.
Clause 40:
The Cinematograph Films Council.
40.—(1) There shall be a Council to be called "the Cinematograph Films Council," consisting of twenty-one members appointed by the Board of Trade; and of the members of the said Council—

(a) eleven (of whom one shall be the chairman of the Council) shall be persons who appear to the Board of Trade to have no pecuniary interest in any branch of the cinematograph film industry;

(b) two shall be persons appointed as representing makers of films;

(c) two shall be persons appointed as representing renters;

(d) four shall he persons appointed as representing exhibitors; and

(e) two shall he persons appointed as representing persons employed by makers of films.

Before appointing a person to be a representative member of the said Council the Board of Trade shall consult such bodies, if any, as appear to the Board to be representative of the interest concerned.
(2) The functions of the said Council shall be—
(a) …
VISCOUNT BERTIE OF THAME VISCOUNT BERTIE OF THAME, who had given Notice of an Amendment in subsection (1), to leave out "twenty-one" and insert "fifteen", said: As the hour is getting rather late, I do not

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know whether it would be for the convenience of my noble friend if I were to postpone this Amendment until the Report stage. If my noble friend will tell me how that he consents to that course I will postpone it; otherwise I shall have to move it.
VISCOUNT SWINTON: I am in the hands of the Committee in this matter. I cannot possibly accept this Amendment. We have had a very full discussion both on the Second Reading and on the Amendment which was moved earlier as to the constitution of the Council, and I had very much hoped that, in view of that full discussion, my noble friend would not move this Amendment but would leave the Council standing as it is. As has been said repeatedly, it is the only thing on which the industry is in agreement, and I am bound to resist any attempts now to vary it this way or that by taking one away here and adding another there. I really can say this with confidence, that any such attempts would meet with very, very great resistance from the combined interests concerned. I am, of course, entirely in my noble friend's hands. If he wishes to move the Amendment he must move it; but I did venture to hope that, as we have had a full discussion of the constitution of the Council, the Committee might pass this clause.
LORD ASKWITH: I suggest that my noble friend should put it down on the Report stage and consider it in the meanwhile. One understands that there is agreement in the industry about this matter and one knows how very difficult it is to form these Councils and to have the different interests represented. Therefore my noble friend might discuss it a little more with the people who are interested with him in the matter. My own view about the Council, when I supported the Amendment by putting my name to it, was that it was too large; but, as there are so very many interests in the trade and all of them must have some representation it is a bad thing to leave out those of any particular class who would think they were unjustly treated. If it is correct that the interests are all agreed and that this is practically an agreed clause, it would be unwise for your Lordships to try to disturb it.
VISCOUNT BERTIE OF THAME: My information is directly opposite to that
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of my noble friend Lord Swinton, but I will consult with the people who have asked me to move this Amendment and I will reserve my right to move it on the Report stage.
LORD STRABOLGI: Does that mean that none of these Amendments to Clause 40 are to be moved? The noble Lord, Lord Gorell, has a very important Amendment which he proposes to insert after paragraph (e).
LORD GORELL: I take it that the rights of later Amendments are not affected by what has just been said.
VISCOUNT SWINTON: My Amendment in subsection (1) (a) is drafting.
Amendment moved—
Page 35, line 8, leave out from ("persons") to end of line 11, and insert ("appointed as being independent persons").—(Viscount Swinton.)
On Question, Amendment agreed to.
LORD MOYNE LORD MOYNE, who had an Amendment in paragraph (a) of subsection (1), to leave out "have no pecuniary interest in any branch of the cinematograph film industry" and insert "be qualified to represent the general interests of the public and to assist the said Council in the exercise of its functions," said: This is covered by the Amendment down in the name of the noble Viscount.
LORD GORELL: I will not now move my Amendment in subsection (1) (d) to leave out "four" and insert "three," reserving one's right to move it on the Report stage when the composition of the Council comes up again. But I feel bound to move the Amendment to insert in subsection (1), after paragraph (e):
"(f) two shall be persons appointed as representing the Society of Authors, Playwrights and Composers."
The statement by my noble friend the Secretary of State for Air, that general agreement has been reached, may apply to the various other sections represented upon the Council, but it does not apply to those on whose behalf I am moving this Amendment. I put down my other two Amendments so as not to increase the total number of the Council. That, I understand, in view of what has taken place just now, will come up for consideration upon Report. But I wish

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to press upon the attention of your Lordships the Amendment which I am now moving.
It is a perfectly simple one, thereby very much in contradistinction to much of the complications which have hitherto formed part of the Bill. It has been rather striking, throughout all the discussions which have taken place upon the cinematograph industry, that there has been as yet no mention whatever of that class of persons without whom no film can come into existence at all, that is to say, the author. The author was mentioned in the 1927 Bill when, I think I am right in saying, there was a provision that the scenario must be by a British author. That has not been found to be workable and now, naturally, is dropped. But still the essential preliminary part of film making, that is to say, the writing of a script, can under this Bill be done in a foreign studio, and, if it is, that would seem to negative one of the great purposes of the Bill, to encourage the British industry and still more to encourage the British ideas as promulgated by this enormous industry throughout the world. When an Amendment in rather similar terms was moved in another place, the President of the Board of Trade, while admitting the right of authors to be represented, claimed that they would come in under the trade union representation. That would seem to be an entire misunderstanding of the purpose of authorship. It could no more be argued that someone who was purely technical or someone who represented a trade union was representative of authorship than I think one could claim that those who brought in pictures for an academy exhibition were entitled to choose what pictures should be hung.
The President of the Board of Trade further argued that, even if they did not come in under that section of the Council, they could still be brought in under the first section, of independent people having no pecuniary interest in the film industry. But that would rule out any author of any standing, any novelist who desired to see his work turned into a film. Not to mention any of the living, we have recently had the example of Mr. Rudyard Kipling's Captains Courageous converted into a film. I think, if we are going to count upon authors being represented in the first section, it means that there will
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be no author who has any standing as far as the maker of stories is concerned. There is a further point which I would press upon the attention of the noble Viscount in charge of the Bill, and that is that, when an Amendment in very similar terms was moved in another place, the President of the Board of Trade said that he held a letter from the Screen Writers' Association, which is the section of the Authors' Society primarily interested in film making, that they agreed with the composition of the Council. That was a mistake, and the President of the Board of Trade, having in all innocence made that statement, apologised to the mover of the Amendment afterwards, because no such letter was in fact in existence. On the strength of that having been stated in another place, the Amendment was negatived. An apology without redress is hardly sufficient.
It has been said that authors should not necessarily be represented on a body which is purely industrial. As I see it, the whole case for protection of the cinematograph industry is that it is much more than an industry; that it is a promulgation of ideas in a very attractive form throughout millions of audiences; and it is essential that we should not have all those ideas represented through an American mind. I therefore venture to hope, in spite of the persistence with which my noble friend has so far resisted all Amendments which have been offered, that this one is incontestable, and that he will be willing to accept the right of authors to be represented in regard to what springs from authors' brains. I beg to move.
Amendment moved—
Page 35, line 19, at end insert—
("(f) two shall be persons appointed as representing the Society of Authors, Playwrights and Composers.").—(Lord Gorell.)
VISCOUNT SWINTON: I am afraid I must resist this Amendment, not because the President of the Board of Trade does not wish to see literature represented indeed, but rather because, as we hope, literature will be represented twice over. Really my noble friend and I find ourselves in a dilemma in this matter. He would certainly not deny that the screen writer or scenario writer would in fact be one of the employees in the industry, a most expert and distinguished one, but

109
still he really is a part of the structure of employment in this industry as much as the star or the expert camera man or whoever it may be, and in so far therefore as the claim comes on behalf of the scenario writer then that surely is rightly included in the representation of those employed in the industry. But my noble friend says there is a much wider consideration than that. Films have their great influence, their moving history and literature, and literature should have its place. I entirely agree, but surely that place is to be found not by adding a literary technician particularly and necessarily among those who are interested in the business, but by seeing, as I am assured my right honourable friend the President of the Board of Trade would wish to see, that literature is represented among the independent members of the tribunal. I think what my noble friend has at heart is that we should look at this from the point of view of the literary influence which films can bring to bear. I venture to think that literature is much better represented on the independent side of this body than by being treated as a technician among the employees. On that understanding I hope that my noble friend will not press the Amendment.
LORD GORELL: I appreciate the argument which has just been addressed to your Lordships by my noble friend. Of course the change of words leaving out "no pecuniary interest" and substituting "independent persons" does make a difference. Can we have an assurance from the noble Viscount that among these persons who are going to be appointed as independent there will in fact be authors appointed by the Board of Trade? It is hardly enough to say that those who have no pecuniary interest will be appointed, because that would rule out all the main authors of the country. If I can have an assurance that authors will be represented then I need not press the Amendment, but in the absence of such assurance I feel bound to press it.
VISCOUNT SWINTON: Yes, if my noble friend means authors in the broad sense. I do not promise that it will be an author who has become a scenario writer, but that literature will be represented, authors shall be represented, in the independent side of the tribunal. I readily give that assurance.
LORD GORELL: That will meet my point of view.
Amendment, by leave, withdrawn.
VISCOUNT SWINTON VISCOUNT SWINTON moved to insert after paragraph (e) in subsection (1):
"(2) It shall be the duty of the Board of Trade to satisfy themselves, with respect to any person whom they propose to appoint under paragraph (a) of the preceding subsection to be a member of the said Council or who is a member of the Council by virtue of an appointment made under that paragraph, that he will have or has, as the case may be, no such financial or commercial interest as is likely to affect him in the discharge of his functions as a member of the Council; and any such person shall, whenever requested by the Board so to do, furnish to them such information as they consider necessary for the performance of their duty under this subsection."
The noble Viscount said: This is more than a drafting Amendment. Noble Lords will remember that Lord Moyne on the last occasion raised what I thought was a very good point, that you might have someone that you would like to put on the independent side of the tribunal who might have some quite small financial interest, it might be a few shares in a company, and who would be otherwise altogether admirable. I promised the noble Lord that I would see whether we could not devise an alternative to the disclosure of interest, and I think that this will meet the point he and I have in mind.
Amendment moved—
Page 35, line 19, at end insert the said new subsection.—(Viscount Swinton.)
LORD STRABOLGI: Before your Lordships pass this Amendment I would like to say that I am afraid I have not followed what has happened to this clause. It is a most important one. Certain Amendments have been moved and others reserved for the Report stage. I thought there was going to be an Amendment moved by Lord Moyne with reference to a full-time chairman.
LORD MOYNE: It is coming later on.
LORD STRABOLGI: That has nothing to do with the Amendment moved by the Minister for Air. I think it is an excellent Amendment.
On Question, Amendment agreed to.
LORD STRABOLGI LORD STRABOLGI moved to insert after paragraph (a) in subsection (2):
"(b) to make recommendations for the establishment of an apprenticeship scheme on the technical side of film production in all its branches;"
The noble Lord said: This Amendment was intended to be moved in another place, but it was not selected by Mr. Speaker. Clause 40 lays down the duties of this Council, and I think that one of those duties should naturally be the drawing up of an apprenticeship scheme for approval by the Board of Trade. This vast industry employs 10,000 technicians, a great number of actors and actresses and people of all kinds in all kinds of trades, and yet it has no apprenticeship scheme at all. There is great complaint, I understand, that we are short of capable English directors. I believe we have a certain number of very good English directors who can make films on the floor, but not so many as we would like to have. Yet there is no system of training up young men with the necessary talents to play a part in the future of this industry. What happens is that people drift into it. There is a good deal of nepotism. Nephews or cousins or relations or friends of the important financial backers of a film are brought in, and there are a number of other young men who go in and for a time are employed with no wages as improvers or learners. The whole state of recruitment is chaotic. Therefore I think that an apprenticeship scheme is badly needed. This is only a provision to make recommendations. It will be for the Board of Trade to act and for the industry itself, later on perhaps, to take a hand in the matter. I am sure your Lordships would agree that this is a very reasonable Amendment and I hope the Government will accept it.
Amendment moved—
Page 35, line 31, at end insert the said new paragraph.—(Lord Strabolgi.)
LORD TEMPLEMORE: I hope the noble Lord does not think that I am not going to be reasonable, but I am afraid I cannot accept this Amendment. It seems to make it a definite duty of the Films Council to make a recommendation for an apprenticeship scheme in the production side of the film industry. To make it mandatory on the Council to consider one particular question raises
112
doubts as to their power to consider others. Their functions are drafted in very wide terms. As set out in subsection (2) of Clause 40 they already comprise keeping under review the progress of the industry "with particular reference to the development of that branch of the said industry which is engaged in the making of films." It would appear that these words would already enable the Council to consider questions relating to apprenticeship schemes in the production branch of the industry, and that the separate Amendment now proposed is accordingly unnecessary. It may be assumed that the representatives of the film employees on the Council will not hesitate to raise the question if they think M. For these reasons I am afraid I cannot accept the Amendment and I hope the noble Lord will not press it.
LORD STRABOLGI: I do not desire to press this Amendment or to put your Lordships to the trouble of a Division, though I feel strongly about it. May I ask, have the Board of Trade themselves any ideas on this, and will the Board of Trade suggest, as they are entitled to do, to the Films Council that this matter should be examined at an early date? If we could have some assurance of that kind it would be some comfort.
LORD TEMPLEMORE: I think I can easily give the noble Lord that assurance. It will certainly be in the mind of the Board of Trade.
LORD STRABOLGI: If I have Lord Templemore's word on that matter, I am satisfied and will not press the Amendment.
Amendment, by leave, withdrawn.
LORD MOYNE LORD MOYNE had on the Paper an Amendment to insert two new subsections empowering the Board of Trade to appoint a Secretary, and to determine the remuneration of officers. The noble Lord said: I understand that the appointment of a paid secretary is well within the competence of the Board of Trade under the powers of the Bill, and therefore, on that understanding, I do not move.
Clause 40, as amended, agreed to.
Clauses 41 and 42 agreed to.
Clause 43 [Interpretation]:
LORD TEMPLEMORE: The three Amendments to this clause are drafting

113
Amendments, but I might just explain that their effect is to shorten the definition of "renters' quota period" without altering its scope. I beg to move.
Amendment moved—
Page 38, line 25, leave out from ("means") to ("beginning") in line 26 and insert ("the year").—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE: I beg to move.
Amendment moved—
Page 38, line 27, leave out ("in the year").—(Lord Templemore.)
On Question, Amendment agreed to.
LORD TEMPLEMORE: I beg to move.
Amendment moved—
Page 38, line 28, leave out ("and a") and insert ("or the").—(Lord Templemore.)
On Question, Amendment agreed to.
Clause 43, as amended, agreed to.
First Schedule:

FIRST SCHEDULE.
  PART I.

    RENTERS' QUOTAS.
    Long Films.

    Short Films.

    Year.

    Per cent.

    Per cent.

    For the year beginning with the 1st April, 1938

    15

    10

PART II.

  EXHIBITORS' QUOTAS.
  Long Films.

  Short Films.

  Year.

  Per cent.

  Per cent.

  For the year beginning with the 1st October, 1938

  12½

  7½

  For the year beginning with the 1st October, 1947

  25

  15

  LORD MOYNE LORD MOYNE moved, in Part I, to substitute 20 per cent. for 15 per cent. as the renters' quota for long films for the year beginning 1st April, 1938. The noble Lord said: I do not want to keep the House long at this hour. We have already had a discussion on an earlier clause, and the House decided that we ought to keep the quotas up as high as we reasonably can without occasioning general default. The Amendment which I wish to move is that we should put up the renters' quota to the level at which it stands under the noble Viscount's Act of ten years ago. For a long time there has been a persistent campaign on the part of
  114
  the renters to get their quota put down. They came to the Departmental Committee and said that the quotas were three times too high. They said, "Where we are now compelled to make fifteen or eighteen films, we ought only to make five or six." We were not at all impressed by the arguments of this extremely rich foreign industry. We felt that the main purpose of legislation ought to be to help production in this country. If the British investor is standing off at the present time, the only way to start films in production is to compel the foreign producer to put back some of the £6,500,000 that he draws every year from this country into the encouragement of British films. It is not going to be a loss to him, it is going to be an investment of capital.
  I am assured that there ought to be no difficulty whatever in carrying out this quota. Already there is a sufficiency of films in sight. Films are not only of value during the first twelve months. I am advised that fifty per cent. of the screening of films takes place after the first year, and in addition to that there is, of course, plenty of time for the renters to get films made for the forthcoming year. It would be a disastrous set-back for the British film industry to put the renters' quota below that figure which it has been able to reach owing to the very wise provisions of the Act of 1927. I beg to move.
  Amendment moved—
  Page 43, line 7, first column, leave out ("15") and insert ("20" ) —(Lord Moyne.)
  LORD STRABOLGI: Surely this Amendment is consequential on the decision of the House on Clause 15?
  VISCOUNT SWINTON: No, I do not think I can accept that, unless two rights make a wrong or two wrongs make a right. That dealt with what was to happen to the exhibitor during the balance of his quota year. This is a proposal that when we start on the new race, we should start with a larger handicap, and that the renters should be put up from fifteen to twenty per cent. Then there is a later Amendment—I do not know whether that is going to be moved—to put the exhibitor up also. It is said that the renter is at this moment under a twenty per cent. obligation under the old Act. I understand that is so. But the reasons for starting in this rather more

  115
  modest way in the present Bill are several. The Bill, to start with, will become law, I suppose, about the end of this month, and the renters' obligation therefore starts on April 1, almost as soon as the Bill is through. There are two other considerations. The short film quota is now introduced, as Lord Moyne recommended, for the first time, and therefore you are putting an additional obligation on the renter in the sense that, whereas everything was aggregated—I am not sure that is right?
  LORD MOYNE: Yes, it is.
  VISCOUNT SWINTON: It was aggregated before, but there is now a separate obligation to take ten per cent. of short films. But the other reason is this. Hitherto, of course, there has been no cost test imposed. We are now, under this Bill, imposing what I call the means test, so that every film which the renter has to take has got to be a film within the long series costing not less than the minimum of £7,500, or £1 in labour charges per foot.
  LORD STRABOLGI: With the right of appeal for cheaper films with good qualities.
  VISCOUNT SWINTON: With that right of appeal. For those reasons it is strongly felt by the Board of Trade that it would not be safe to place the renters' quota higher than fifteen per cent. If, while I am on my feet, I might say one word about the exhibitors' quota: I feel strongly that it is important to have it starting at a figure which exhibitors can easily fulfil. As I said, it is very im
  portant that the Act should work with good will, and you should take all exhibitors into consideration and be fairly sure that the obligations you put on them can be filled without undue difficulty by all the different cinemas within the country. For those reasons, my Lords, I am bound to resist the Amendment and to ask that the quota may be reduced from what it stands at now to the figures set out in the Schedule.
  LORD DARCY (DE KNAYTH): There is one thing to which I should like to draw attention, and that is the importance that has been attached by the noble Viscount to the difficulty of finding short films. That does not affect the Amendment at all, because the Amendment leaves the short film provision exactly where it was before. If the Amendment were carried, ten per cent. would have to be obtained for those short films, and if the Amendment is not carried, precisely the same. It puts the figure of the quota at twenty per cent., which is not increasing the handicap but putting it back to where it was in 1936. There is also a small film quota now, which means that it is actually less, even if you are not to take into account the fact that a triple quota is introduced. We do not want to give a bonus for the invention of the "quota quickie." If you are going to give a bonus for ingenuity in defrauding the last Act, your Lordships will find that every succeeding Act becomes more complicated and less satisfactory.
  On Question, Whether "15" shall stand part of the Schedule?
  Their Lordships divided:—Contents, 13; Not-Contents, 22.

  CONTENTS

  Bath, M.

  Swinton, V.

  Gage, L. (V. Gage.) [Teller.]

  Kemsley, L.

  Fortescue, E.

  Clanwilliam, L. (E. Clanwilliam.)

  Strathcona and Mount Royal, L.

  Lucan, E. [Teller.]

  Munster, E.

  Cottesloe, L.

  Templemore, L.

  Stanhope, E.

  Fermanagh, L. (E. Erne.)

  NOT-CONTENTS

  Aberdeen and Temair, M.

  Balfour of Burleigh, L.

  Luke, L.

  Darcy (de Knayth), L. (Teller.)

  Moyne, L. [Teller.]

  Poulett, E.

  Rankeillour, L.

  Doverdale, L.

  Saltoun, L.

  Bertie of Thame, V.

  Fairfax of Cameron, L.

  Strabolgi, L.

  Bridgeman, V.

  Gorell, L.

  Teynham, L.

  Chelmsford, V.

  Harris, L.

  Waleran, L.

  Hindlip, L.

  Wolverton, L.

  Addington, L.

  Holden, L.

  Resolved in the negative, and Amendment agreed to accordingly.
  LORD MOYNE LORD MOYNE moved to substitute "15 per cent." for "12½ per cent." as the exhibitors' quota for long films for the year beginning with the 1st October, 1938. The noble Lord said: I do not think I need give any further argument in favour of this Amendment. I beg to move.
  Amendment moved—
  Page 43, line 21, leave out ("12½") and insert ("15").—(Lord Moyne.)
  VISCOUNT SWINTON: This really becomes consequential, because it is putting up the exhibitors' quota to what is a reasonable ratio as compared with what has been done with the renters' quota. As your Lordships have decided to leave the renters' quota where it was under the old Act, I think it would be reasonable to put the exhibitors' quota up from 12½ to 15.
  On Question, Amendment agreed to.
  VISCOUNT BRIDGEMAN VISCOUNT BRIDGEMAN moved to substitute "30 per cent." for "25 per cent." as the exhibitors' quota for the year beginning with the 1st October, 1947. The noble Viscount said: In a sense this Amendment follows on the Amendments previously discussed, but, unlike them, it will, as your Lordships will realise, not take effect until 1947. If, however, there is a case for starting the quota higher there is also a case for giving an increased quota at the end.
  Amendment moved—
  Page 43, line 3o, first column, leave out ("25") and insert ("30").—(Viscount Bridgeman.)
  VISCOUNT SWINTON: I very much hope the noble Viscount will not press this Amendment. If we are going to rely upon the statutory quota then that would mean inevitably that the exhibitors' quota and the renters' quota would both reach thirty. I am sure the noble Viscount does not mean that, because the whole principle of the statutory schedule is to keep the renters' quota rather ahead of the exhibitors'. There is taken power for the Board of Trade, on the advice of the Film Council, to increase if they think right the exhibitors' quota up to thirty. I do not think we
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  ought to go further, and necessarily lay down that the exhibitors' and renters' quota should be the same. That might be very unfair to the exhibitors.
  Amendment, by leave, withdrawn.
  First schedule, as amended, agreed to.
  Remaining schedules agreed to.
  Title:
  An Act to make further provision for securing the renting and exhibition of a certain proportion of British cinematograph films, and for restricting blind booking and advance booking of cinematograph films; and to provide for purposes connected with the matters aforesaid.
  LORD STRABOLGI: My Amendment to the title, to insert certain words after the second "films," is consequential.
  Amendment moved—
  Page 1, line 5, after ("films") insert ("to make provision as to the wages and conditions of employment of persons employed by makers and processors of films").—(Lord Strabolgi.)
  On Question, Amendment agreed to.
  Title, as amended, agreed to.

TRADE MARKS BILL. [H.L.]
Read 3a (according to Order), and passed, and sent to the Commons.
EVIDENCE BILL. [H.L.]
Amendments reported (according to Order).

BUSINESS OF THE HOUSE.
THE PRESIDENT OF THE BOARD OF EDUCATION (EARL STANHOPE): My Lords, I understand that there is no business down for to-morrow. On the other hand, the Leader of the Opposition has put down for Wednesday a Motion to discuss foreign affairs. Therefore I propose to move that the House should adjourn for public business until three o'clock on Wednesday.
Moved accordingly and, on Question, Motion agreed to.
House adjourned at twenty minutes before eight o'clock.

PAISLEY CORPORATION (GENERAL POWERS) ORDER CONFIRMATION BILL.
Brought from the Commons; read 1a; to be printed, and (pursuant to the Private Legislation Procedure (Scotland) Act, 1936) deemed to have been read 2a, and reported from the Committee.
SALFORD CORPORATION BILL. [H.L.]
Petition for additional provision of the Mayor, aldermen and citizens of the City of Salford under their Common Seal; together with the proposed clause annexed thereto; read, and referred to the Examiners.
TATTON ESTATE BILL. [H.L.]
The LORD CHANCELLOR acquainted the House, That in pursuadance of Standing Order No. 192 relating to Private Bills, he had, on the requisition of the Chairman of Committees, appointed Alexander Fitzmaurice Gilchrist, Official Solicitor to the Supreme Court of Judicature, as guardian or protector of the infant Elizabeth Grey Tatton, interested in the Bill, to represent such infant before the Committee on the Bill; and James Bass Finch, Assistant Official Solicitor to the Supreme Court of Judicature, as guardian or protector of the infants June Rosemary Egerton Tatton, Helen Townley Tatton, Susan Hamilton Tatton and Christopher Tatton, interested in the Bill, to represent such infants before the Committee on the Bill.
MARRIAGE (LICENSING OF CHAPELS) MEASURE, 1938.
Text of the Meausure: Laid before the House (pursuant to Act) and to be printed.

ECCLESIASTICAL COMMITTEE.
Seventy-second Report, being the Report by the Ecclesiastical Committee
120
upon the Marriage (Licensing of Chapels) Measure, 1938: Laid before the House (pursuant to the Act) and to be printed.

GUILDFORD CATHEDRAL MEASURE, 1938.
Text of the Measure: Laid before the House (pursuant to Act) and to be printed.
ECCLESIASTICAL COMMITTEE.
Seventy-third Report, being the Report by the Ecclesiastical Committee upon the Guildford Cathedral Measure, 1938: Laid before the House (pursuant to Act) and to be printed.

KIDSGROVE GAS ORDER, 1938.
Special Order proposed to be made on the application of the Kidsgrove Gaslight Company: Laid before the House (pursuant to Act) for affirmative Resolution and referred to the Special Orders Committee.
[From Minutes of Judicial Sitting, March 15.]
The LORD SPEAKER acquainted the House, That the Clerk of the Parliaments had laid upon the Table the Certificate from the Examiners that no Standing Orders are applicable to the following Bills:

Ministry of Health Provisional Order (Halifax),

Ministry of Health Provisional Order (Nuneaton Extension).

Also the Certificate that the Standing Orders have not been complied with in respect of the petition for the following Bill:

Oxford Corporation (Electricity).

And also the Certificates that the Standing Orders have not been complied with in respect of the petitions for additional provision in the following Bills:

Middlesex County Council (Sewerage).

London and North Eastern Railway.

The same were ordered to lie on the Table.