Sitting of 3 June 1943

Preamble
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  NATIONAL WAR EFFORT

    Hospitals (Nursing and Domestic Staffs)
    Mr. Fosterasked the Minister of Labour what representations he has received of the serious shortage of nursing and domestic staffs in infectious diseases hospitals; and whether he has had any consultations with the Minister of Health with the view of remedying the position?
    The Minister of Labour (Mr. Ernest Bevin): I am fully aware of the serious shortage of nursing and domestic staffs in certain hospitals, including hospitals for infectious diseases, and I have discussed the position with my right hon. Friend the Minister of Health. Local appointments officers of my Department are already reviewing the position of nurses and midwives who registered on l0th April under the Nurses and Midwives (Registration for Employment) Order, 1943, and in placing available women, priority is being given to vacancies in those hospitals, including hospitals for infectious diseases, where the shortage is most acute. As regards domestic staff, I would refer my hon. Friend to the reply which I gave to the hon. Member for East Islington (Mrs. Cazalet Keir) on 13th May, of which I am sending him a copy.

    Transferred Women, England and Wales
    Professor Gruffyddasked the Minister of Labour how many men and women, respectively, have been transferred from Wales to England, and from England to Wales, by direction of his Ministry?
    Mr. Bevin: The number of women transferred from Wales to employment in England after registration under the Registration for Employment Order and the National Service Acts was 1,455 up to 1st June, 1943, from 16th June, 1942, on which date my Department started to keep records in this connection. In the same period 114 women went from England to work in Wales.
    Professor Gruffydd: In view of the effect of these transfers on the life of Welsh towns, will the right hon. Gentleman see that only voluntary transfers are made in future?
    Mr. Bevin: I am afraid I cannot accept that.

    Dog Trainer
    Major Sir Jocelyn Lucasasked the Minister of Labour whether his attention has been drawn to the remarks on 27th May of Sir Gervais Rentoul when convicting a dog trainer of the international circus for cruelty; and whether he will direct the man concerned to work connected with the war effort?
    Mr. Bevin: I am having inquiries made into this case and will communicate with my hon. and gallant Friend.

    Ex-Cotton Workers
    Mr. Tinkerasked the Minister of Labour whether he is aware that many persons had to seek other employment when cotton mills went on short time or closed down; that they are being recalled now and some are objecting to it and wish to remain at their present work; and whether full consideration is given to them?
    Mr. Bevin: Yes, Sir. Owing to the urgent need for experienced workers in some sections of the cotton industry, I am asking ex-cotton workers, including some engaged in munitions production, to return to their former employment. Where workers are transferred compulsorily to cotton by direction under Regulation 58A the normal procedure of appeal to a local appeal board against the direction is available.
    Mr. Tinker: Are there any further efforts they can make if the appeal board rejects their appeal?
    Mr. Bevin: No, Sir.
    Mr. Tinker: Will my right hon. Friend have some regard to the conditions obtaining in the cotton industry, and could not efforts be made to make the cotton workers' position a little better than it is at the present time, because they are being driven back to conditions they did not like from positions where they have been getting better wages?
    Mr. Bevin: I have to follow the rate for the job, and wages in the cotton trade have been arranged with the cotton

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    Union, and I am happy to say that there have been material improvements made in the cotton trade during the war.

    Accountants' Staffs
    Major Sir Adrian Baillieasked the Minister of Labour whether he is aware that, because of the withdrawal of members of the staffs of professional accountants' offices, apprehension and unrest are being caused among members of the public who are unable to obtain the skilled advice and assistance they require in connection with their tax affairs; and will he state the number of women within the scope of the National Service Acts who are at present employed in the offices of the Inland Revenue in connection with the administration and collection of Income Tax, Excess Profits Tax, National Defence Contribution and War Damage Contribution?
    Mr. Bevin: I have had no evidence that apprehension and unrest are being caused among members of the public owing to the withdrawal of staff from accountants' offices. Deferment of calling-up has been granted to a very considerable number of accountants and male members of their staffs who are liable for military service, and men over military age are not being withdrawn from the profession. Deferment is not normally granted in the case of women who are liable under the National Service Acts, but other women possessing special qualifications are not being withdrawn. The second part of the Question should be addressed to my right hon. Friend the Chancellor of the Exchequer.
    Sir A. Baillie: In regard to the reply to the first part of my Question, is it not a fact that in certain cases arrangements were made that essential members of professional accountancy staffs would not, in fact, be called up unless suitable substitutes could be found, and is the right hon. Gentleman aware that in the cases which I brought to the attention of the Ministry such substitutes were not found and considerable hardship is being caused to my constituents?
    Mr. Bevin: I am advised on this matter with regard to accountants by a headquarters committee, who go into the thing very carefully. I cannot guarantee prior substitution in every case, and I take this occasion to say that I am afraid that prior substitution will have to go very shortly
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    altogether, because when I send substitutes people want to keep their own staffs, and they make it difficult to take on the substitutes.
    Sir A. Baillie: Is the Minister aware that in certain cases such a guarantee was given?
    Mr. Bevin: I should want notice of that question.
    Colonel Sir A. Lambert Ward: Is it to be understood that professional chartered accountants are exempt from military service at all ages?
    Mr. Bevin: Oh no, Sir.

    Workers' War Record
    Mr. Ellis Smithasked the Minister of Labour whether it is intended to publish a book containing the war record of the Ministry of Labour, an account of the achievements of industry in organising and utilising man- and woman-power and the contribution made by the organised workpeople in the workshops in the training of workers; if so, when will it be published; and will he see that a large sale is organised and that copies be sent to all military units and to all His Majesty's ships?
    Mr. Bevin: A book on the mobilization of the man- and woman-power of this country has been written and is now with the printers. Publication and distributional arrangements are in the hands of my right hon. Friend the Minister of Information.
    Mr. Smith: Will my right hon. Friend convey this suggestion to the Minister of Information with a view to getting as large a sale as possible organised, and will he also see that the suggestion in the Question that copies should be broadcast to all people serving in His Majesty's Forces is carried out?
    Mr. Bevin: I will bear that in mind.
    Sir Herbert Williams: Does the right hon. Gentleman think that there will be enough paper to supply everybody with a copy?
    Mr. Smith: Will my right hon. Friend bear in mind that the achievements of the workers in this war are such that they should be made known, and would not paper be well used on a publication of this character?
    Major-General Sir Alfred Knox: Will the Minister see that this book gives some recognition to the work of industrialists, who have not been referred to at all?

    POST-WAR OVERSEAS POLICING
    Major Nieldasked the Minister of Labour whether he will forthwith call for volunteers to form the Armed Forces or part of those Forces necessary for the occupation or policing of such areas overseas as may have to be occupied or policed after the war, in order to release naval, military and Air Force personnel who have served abroad either to return home or to civilian employment as soon as possible?
    Mr. Bevin: I would refer my hon. and gallant Friend to the reply given to him by the Secretary of State for War on 1st June and to the reply which I gave to the hon. Member for Swindon (Mr. Wakefield) on 20th May, of which I am sending him a copy.

    MILITARY SERVICE (CINEMA TECHNICIANS)
    Mr. Sorensenasked the Minister of Labour whether, in considering applications for postponement or deferment of military service, technicians engaged in cinema production have their specialist work fully taken into consideration; whether interested Government Departments are consulted in the matter; and whether the advice of these Departments is taken, particularly respecting the avoidance of handicaps to production?
    Mr. Bevin: Applications for the deferment of calling-up of men engaged in film production are referred to an independent Advisory Committee which gives careful consideration to their specialist work. Interested Government Departments are afforded the opportunity of making representations to this Committee, and due weight is given to their advice on all matters affecting production.
    Mr. Sorensen: May I ask my right hon. Friend whether the appropriate trade union is taken fully into consultation?
    Mr. Bevin: The Department is in the habit of consulting everybody who asks to be consulted.

    ARMED FORCES (PENSIONS AND GRANTS)
    Mr. Willinkasked the Minister of Pensions whether he is aware that, under the present provisions for pensions and allowances for the widows and children of deceased members of His Majesty's Forces, these dependants may be reduced on the termination of war service grant, especially in areas where rents are high, to a standard of living far below that deemed proper during the life of the deceased man; and whether he will consider as an urgent matter the application of the minimum unit standard of 18s. in such cases?
    The Minister of Pensions (Sir Walter Womersley): The question raised by my hon. and learned Friend is among the matters which I am examining following the Debate in this House on 23rd March last.
    Mr. Willink: Is the right hon. Gentleman not prepared to say that it is an urgent matter to ensure that these widows, who may be bearing another child or may be bringing up a number of children and may be quite unable to work, are assured of a minimum standard?
    Sir W. Womersley: This and many other matters mentioned in the Debate are indeed matters of importance. I am doing my best to get down to the consideration of all of them so that I can make a comprehensive statement to the House.
    Mr. Willink: My right hon. Friend says that it is a matter of importance; is he not prepared to say it is a matter of urgency?
    Captain Cobb: In view of the fact that a war service grant is given to a wife in order to bring her up to a minimum level of subsistence, will my right hon. Friend inquire into the reasons why, as soon as a wife becomes a widow, her pension automatically reduces her income below the Minister's own standard of minimum subsistence?
    Sir W. Womersley: My hon. and gallant Friend is behind the times; I am considering that and have been doing so for some time.
    Mr. Willink: Does not the present position leave these women below the standard which will be achieved for civilian widows under the Pensions and Determination of Needs Bill?
    Sir W. Womersley: I am considering that too.
    Mr. Willinkasked the Minister of Pensions whether he will consider the introduction of the principle of ante-natal allowances in the case of posthumous births on the lines already applied by the Service Departments in the case of births during the father's life?
    Sir W. Womersley: I am glad to have the opportunity of stating that from the outset of the scheme my Department has paid a pre-natal allowance to a widow in receipt of a pension in any case where the pre-natal allowance period began after the termination of the period for which pay and allowances are continued by the Service Departments. Payment is made by the Service Departments in any case where the pre-natal allowance period begins whilst Service pay and allowances are still in issue.
    Mr. Willink: Can my right hon. Friend say why, as many months have elapsed since the Services adopted this principle, his Department have not announced their adoption of the principle?
    Sir W. Womersley: We have put it into operation, which is better than announcing it.
    Mr. Bellenger: Does this also include an unmarried dependant?
    Sir W. Womersley: I should want notice of that question.
    Major Lyonsasked the Minister of Pensions the maximum amount of pension now awardable to a parent, or to parents, respectively, in respect of the death on active service of a private soldier son in respect of whom dependency is established; and the date of the Warrant fixing these amounts?
    Sir W. Womersley: Under the Royal Warrant of 12th January, 1943, the maximum pension awardable to one parent is 16s. 6d. and to two parents 19s.
    Major Lyons: Arising out of this disclosure, does my right hon. Friend think these meagre figures are in any way related to the reasonable considerations of compensation for dependency? Will he not merely consider the matter but take steps to put an end to this shocking rate of pension?
    Sir W. Womersley: This is also a matter which is being fully considered by my Advisory Committee.
    Mr. Lawson:is the Minister considering the parents' pension——
    Sir Granville Gibson: On a point of Order, Mr. Speaker. Could you make an appeal to Members to speak up instead of whispering?
    Mr. Lawson: Is the Minister also reviewing the case of a mother whose son has been making an allotment but now receives no pension at all?
    Sir W. Womersley: I am reviewing the whole position as regards parents.
    Major Lyons: Does not my right hon. Friend think that the time has gone by for consideration and that the time has now come for some action?
    Sir W. Womersley: During the recent Debate 14 propositions were put to me by Members who regarded them as being equally as important as the question which my hon. and gallant Friend has just put to me. I have already stated that it would be far better that I should come forward with a comprehensive scheme dealing with all these matters.
    Major Leighton: When will my right hon. Friend be in a position to make an announcement?
    Mr. Gallacher: This year, next year?
    Sir W. Womersley: I do not take the hon. Member's example. I will make an announcement as soon as it is possible to do so.
    Mr. Moelwyn Hughesasked the Minister of Pensions whether he is aware of the case of the late Lieutenant E. McPherson, Royal Naval Reserve; that this officer was twice torpedoed and then developed a nervous condition due to the torpedoing and later a disability which proved fatal; that his widow and orphans are entirely without means; and will he reconsider his refusal to grant a Service pension?
    Sir W. Womersley: As I have explained to the hon. Member, Mr. McPherson's death was due to a malignant disease of the abdomen which I am advised was neither caused nor influenced in its pro-

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    gress by the officer's war experiences. In these circumstances, I regret, therefore, that a pension cannot be awarded to Mrs. McPherson.
    Mr. Hughes: Can the right hon. Gentleman really justify that statement to this House after the advice which has been given to him, namely, that this man's death was completely unconnected with the Service, seeing that he was twice torpedoed, that he was subjected to an operation under Service conditions, and that he was, in fact, accepted as A.I when he went into the Navy?
    Sir W. Womersley: This is a case of cancer. I have consulted my medical advisers and other medical experts, not merely on this particular case, but on the general question of this disease, many times. The advice given to me is that this officer's death cannot be ascribed to war service. Mrs. McPherson will have an opportunity now of presenting her case to an appeal tribunal, and we shall get a decision from someone outside the Ministry.
    Mr. Hughes: In the meantime will not the Minister temporarily reconsider his decision, because the widow and children are now completely dependent upon charity?
    Mr. Gallacher: Answer!
    Sir W. Womersley: The hon. Membér is a little impatient. He asked me to answer when I was getting up to do so. I am always courteous to the House, and I hope Members will be courteous to me. In reply to the hon. Member for Carmarthen (Mr. Hughes), I will go carefully into this matter, but I must repeat that the advice which has been given to me up to now is that deaths from cancer have nothing to do with war service.
    Sir Percy Harris: Will the Minister reconsider the whole question of cancer, because it is constantly used as an excuse and a reason for escaping liability by the Ministry?
    Sir W. Womersley: We shall have an opportunity shortly, now that tribunals are set up, of having this matter determined outside my Department or my advisers. In the meantime I will see what can possibly be done in this case.
    Mr. A. Edwards: Is the Minister not aware that the country is becoming impatient about cases similar to this where something is done only after pressure? There is a deep-rooted impression that, the men in the Minister's Department are using their skill and ingenuity to cheat these men.
    Sir W. Womersley: I have travelled widely and extensively, interviewing war pensions committees and branches of the British Legion throughout the country—I have just returned from an extensive tour of Scotland—and I do not agree at all with the view that has been expressed by the hon. Member.
    Mr. Dobbieasked the Minister of Pensions whether he can inform the House as to the number of cases of members of the Forces, who have been discharged from the Forces owing to disability, who have made application for pensions and whose claim has been rejected; and what percentage of such rejection have been psycho-neurosis cases?
    Sir W. Womersley: I regret that it would not be in the public interest to give the figures asked for in the first part of the Question. As regards the second part, the percentage is about 17.
    Mr. Oldfieldasked the Minister of Pensions the number of meetings held by his Central Advisory Committee during 1943; and the matters submitted to the Committee for their advice?
    Sir W. Womersley: The Committee have held three meetings, and in addition there were three meetings of a subcommittee. The following matters have been put before them for consideration:
    Pensions Appeal Tribunals and related issues;
    Position of widows on cessation of service allowances and War Service Grants;
    Parents' Pensions;
    Personal Injuries (Civilians) Scheme.
    Mr. Oldfieldasked the Minister of Pensions whether he will consider the granting of family allowances to disabled ex-Service men who marry, after becoming disabled, in cases where there is definite proof that a contract to marry

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    was entered into before the date of disablement?
    Sir W. Womersley: The granting of family allowances to disabled men who marry after receipt of their disability is a matter which I have already promised to bring before my Central Advisory Committee.
    Mr. Oldfieldasked the Minister of Pensions whether he has yet any announcement to make with regard to improvements to the Royal Warrant for Pensions as a result of the views expressed and representations made to him?
    Sir W. Womersley: No, Sir, I have not yet completed my consideration of all the various matters affecting the Royal Warrant which have been represented to me.
    Mr. Oldfield: When shall we have some definite assurances?
    Sir W. Womersley: In addition to the matters brought forward in the Debate and representations which have been made to me from various organisations representing ex-Service men, I have received a suggestion from the British Legion in Scotland which is of a fundamental and drastic nature, and I felt it my duty to consider that suggestion along with the others before making a clear statement to this House. I have been to Scotland for interviews, and I am going on with my investigation.
    Mr. Bowles: Would not the Minister consider working on the principle of "Fit for service, fit for pension"?
    Mr. Bellenger: In view of the fundamental changes in the administration of the Pensions Warrant suggested by the British Legion in Scotland, does the Minister intend to hold up his proposals until he has given complete consideration to their views?
    Sir W. Womersley: It is not a question of administration. The suggestions made by the British Legion in Scotland deal with a principle which goes to the root of the matter, and I feel that I ought to give it due consideration before making a statement.
    Mr. Bowles: Will the Minister answer my question?

    INDIA

      Armed Forces (Income Tax)
      Mr. Fraserasked the Secretary of State for India the rate per £1 of income levied for Income-Tax purpose on members of His Majesty's Forces serving in India; whethere there is a personal allowance relieved of tax and, if so, what is it; and why reliefs are not given in respect of family commitments?
      The Secretary of State for India (Mr. Amery): Members of His Majesty's Forces serving in India are assessable, in the same way as other persons, to tax under the Indian Income-tax Act. Incomes to £112 10s. are exempt. Those above that level are taxed on a sliding scale. For example, an income of £300 would in effect be taxed at 11¾rid. in the £, and one of £1,200 as 2s. 9½. in the £ There is no personal allowances as such, but in the case of total incomes exceeding £150 the first 1£112 10s. is not subject to tax. As regards the last part of the Question, the power to legislate on these matters rests with the Indian Legislature.
      Mr. Fraser: Does not the right hon. Gentleman agree that the principle of family and married reliefs is a very good one, and will he represent those views to the appropriate authorities in India in view of the dissatisfaction on the part of our men there?
      Mr. Amery: It is not a question of my agreement. It is a question for the Indian Legislature.
      Mr. McEntee: Is the right hon. Gentleman not aware that many of these men serving in India are in fact so badly off that there is no comparison with men of equal rank serving at home, and will he not make an allowance to the Indian Army people which will enable them to pay the high rate of tax that they are now paying?
      Mr. Amery: In most cases officers and N.C.O.'s in India are better off, but in the case of some senior N.C.O.'s and junior officers with large families, they are liable to Indian Income Tax when they would not be liable to tax here. It is not possible to reconcile those anomalies.
      Mr. Granville: Is it not the case that there are certain officers serving in the

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      Forces in India who pay double Income Tax—in India and in this country?
      Mr. Amery: That question would more properly be addressed to the Chancellor of the Exchequer. It depends, I imagine, on whether they have private incomes in this country.

      Food Situation
      Mr. Sloanasked the Secretary of State for India whether he will make a further statement respecting the food situation in India; whether the prices of primary foods are still 10 and more times their pre-war level; whether rice is in substantially greater supply; and what further steps have been taken to meet the shortage of foodstuffs?
      Mr. Amery: The latest reports from India are that the wheat just reaped is a bumper crop, and the other spring crops are good. The crop is moving slowly to the market and prices are still high. The rice situation still causes anxiety and must continue to do so so long as the Burma crop is lost to us. The chief concern at present is for Bengal and especially Calcutta, where the price of rice is shown as more than eight times pre-war, though this is not true of India generally. The Government of India have taken into their own charge the adjustment of supplies between surplus and deficiency areas throughout the country, divided into six regions, each under a Central Government Commissioner, and each comprising several "food provinces."
      Mr. Sloan: As the position is alarming, and famine conditions in many areas are very acute, will the right hon. Gentleman undertake to see that all possible steps are taken to provide food for these people?
      Mr. Amery: The Government of India are doing all in their power.
      Sir A. Knox: Are not some middlemen hoarding large quantities of rice and grain?
      Mr. Amery: Yes, probably hoarding is at the bottom of the difficulty.
      Mr. Sorensen: Are steps being taken to control prices?
      Mr. Amery: The control of prices is very difficult in India.
      Mr. Sloan: Surely something can be done to bring the price down from the level of 10 times more than it was before the war.
      Mr. Amery: Every attempt is being made to bring it down.

      Indians, South Africa
      Mr. Sorensenasked the Secretary of State for India whether he has any information as to the result of the representations made by the Indian Government to the South African Government regarding the Trading and Occupation of Land Restriction Bill and the restrictions this imposes on Indian nationals; and whether any modification has been accepted by the South African Government?
      Mr. Amery: I understand that the Bill referred to passed into law on 28th April on the lines originally proposed. It is a temporary Measure, for three years only, and the Union Government announced in connection with it their intention to set up immediately a commission, under a high judicial authority, on which Indians would be invited to serve, to inquire into matters affecting the Indian community in Natal and make recommendations. The persons described by the hon. Member as Indian nationals are for the most part South African nationals of Indian origin.
      Mr. Sorensen: Are the Indian Government satisfied with the situation; is this a committee on which certain Indians may sit, and are these Indians Indian nationals or Indian citizens of South Africa?
      Mr. Amery: They are South African nationals, as I have pointed out in my answer.

    INDUSTRIAL FIRE BRIGADES (UNIFORM)
    Captain Stricklandasked the Secretary of State for the Home Department the result of his consultation with the Minister of Production with regard to the issue to members of industrial fire brigades of suitable uniform clothing and boots on the same terms as are already given to members of the National Fire Service; and, if not, when it is likely that a decision will be made?
    The Secretary of State for the Home Department (Mr. Herbert Morrison): I

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    regret that I am not yet in a position to add anything to the reply given to my hon. and gallant Friend on 17th March last. My right hon. Friend the Minister of Production has been giving very full consideration to the whole question of uniform supplies, but, as my hon. and gallant Friend will realise, the supply position is becoming more difficult as time goes on.
    Captain Strickland: Is the right hon. Gentleman aware that men discharged for inefficiency from works fire brigades and joining the N.F.S. at once get a full issue of uniform, while the only issue available to industrial fire brigades on payment is made of cotton twill which is quite unsuitable?
    Mr. Morrison: I do not think I should be disposed to accept the assumption on which that question is based.
    Captain Strickland: If I bring a definite case before the right hon. Gentleman where such a thing has happened, will he look into it?
    Mr. Morrison: Certainly.

    CIVIL DEFENCE

      Prosecutions
      Mr. Rhys Daviesasked the Home Secretary the number, up to the last available date, of persons prosecuted for violating the several regulations covering air-raid precautions, Civil Defence, fire-watching and kindred services; and how many have been imprisoned, male and female, respectively?
      Mr. H. Morrison: I regret that the information asked for is not available, and, in view of the pressure upon local authorities and their staffs, I should not feel justified in asking them to prepare statistics of this nature.
      Mr. Davies: Is it intended to publish these figures when the situation has eased?
      Mr. Morrison: I could not say. I do not know whether the records will exist.

      Travel Permits to Northern Ireland
      Dr. Littleasked the Home Secretary whether, owing to the largely increased acreage under tillage, he will grant to teachers from Northern Ireland in Great Britain who can satisfy him that
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      they have arranged with farmers to assist in harvesting operations during the summer holidays permits to enable them to travel to Northern Ireland for that purpose?
      Mr. H. Morrison: No, Sir. Under the change in the Regulations made last year such persons 'were allowed to pay two visits to Ireland in the 12-month period which commenced on 1st October, 1942. My hon. Friend appears to be asking that three visits should now be allowed, but I am not prepared to make this further concession.
      Dr. Little: Will the arrangements already entered into with Northern Ireland farmers to act as land girls and harvest workers, when their help is so much needed have to be cancelled owing to the slavish adherence to the letter rather than to the spirit of the law bearing on the granting of travel permits?
      Mr. Morrison: I am delighted, and the Minister of Agriculture will be delighted, to know that teachers are anxious to work on the land. If the hon. Member knows of any such cases, the Minister of Agriculture will be glad to fix them up in Great Britain.

      Emergency Water Supplies (Protective Safeguards)
      Mr. Ammonasked the Home Secretary when he proposes to implement the promise given in November last to place protective safeguards on the emergency water supplies?
      Mr. H. Morrison: The necessary instructions were issued on 26th November last and the provision of protective safeguards is proceeding as rapidly as available resources in labour and materials permit. Progress on the whole has been good, and in most Regions the above ground installations will have been provided with barbed wire protection within the near future. The protection of basement installations by brick walling will take a little longer in certain places where the work to be done is extensive and the labour situation difficult, but special efforts have been made to mobilise labour resources for the purpose in those areas.
      Mr. Ammon: Can my right hon. Friend say where protective safeguards have been placed, because it is difficult to find

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      them? With the advent of fine weather the casualties are mounting again.
      Mr. Morrison: My recollection is that the barbed wire is to be placed somewhere about the top of the wall.
      Mr. Ammon: I mean in what towns?
      Mr. Morrison: All over the country.
      Mr. Ammon: Not in London.
      Mr. Morrison: London is coming along.

    SPEED OFFENCES (POLICE TIMING)
    Wing-Commander Hulbertasked the Home Secretary how many police forces in England and Wales time the speed of motor-vehicles by a system of hand signals by police officers; and whether this method is considered satisfactory?
    Mr. H. Morrison: I regret that I have not the information to enable me to answer the first part of the Question. There is no reason why, in competent hands, the method of timing referred to should not produce accurate records of speed.
    Wing-Commander Hulbert: Is the right hon. Gentleman aware that this practice is continually being condemned by judges and chairmen of quarter sessions owing to the likelihood of error' which always works against the motorist?
    Mr. Morrison: I have not been aware that there was general discontent in the Courts. I am aware that any motorist who gets caught for speeding feels that there is something wrong about it.
    Wing-Commander Hulbert: In view of the fact that private motoring is now nonexistent and the only motor cars on the road are those engaged on essential services, will the right hon. Gentleman abolish the system?
    Mr. Morrison: On the other hand, it has been impressed upon the public by the Supply Departments that unnecessary speeding is wasteful of petrol and rubber. In any case I am really not concerned with the merits of the law. I find the law as it is, and I have to enforce it.
    Mr. R. J. Taylor: Is my right hon. Friend aware that although there are
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    fewer cars on the road, the public are greatly alarmed at the number of fatalities?

    ELECTORAL REFORM
    Mr. Stokesasked the Home Secretary whether he can now make a statement regarding electoral reform, especially with regard to by-elections in war-time?
    Mr. H. Morrison: I regret that I am still unable to add anything to the reply which my right hon. Friend the Parliamentary Under-Secretary of State gave to the Question on this subject by my bon. Friend the Member for East Birkenhead (Mr. Graham White) on 12th May.
    Mr. Stokes: Does my right hon. Friend recollect that the Prime Minister said that a statement would probably be made before. Easter and that he himself a few weeks ago told me he hoped to make a statement before Whitsuntide?
    Mr. Morrison: What the Prime Minister said was that he might be able to make a statement before Easter, and I said that if I could not make a statement before Whitsuntide, I. should be very disappointed. I hasten to add that I am.
    Mr. Graham White: Will this statement give an opportunity for a Debate?
    Mr. Morrison: I think not. I propose to make a Parliamentary statement in answer to a Question or otherwise, but I cannot commit myself that legislation will be involved. I think that it probably will be, in which case there would be ample opportunity for the House to debate and examine the proposals.

    EXPLOSION, WEST END (INQUIRY)
    Mr. Thorneasked the Home Secretary whether he can give any information about the explosion at the junction of Dean Street and Romilly Street on the night of 29th May; what amount of damage was done; if any people were injured; and what was the cause of the explosion?
    Mr. H. Morrison: I am informed that this incident is the subject of a criminal charge, the trial of which is pending. In these circumstances all I can properly say is that the damage was not extensive and that happily nobody was injured.
    Mr. Thorne: Who is prosecuting in the matter?
    Mr. Morrison: I am afraid I cannot say without notice.

    DOG TRAINER (CONVICTION)
    Sir J. Lucasasked the Home Secretary whether his attention has been drawn to the remarks on 27th May of Sir Gervais Rentoul when convicting a dog trainer of the international circus for cruelty; and whether he will see that the act concerned is withdrawn?
    Mr. H. Morrison: I have seen news reports of these remarks. Power to suppress the training or exhibtion of a performing lies not with me but with a court of summary jurisdiction, which, on complaint of cruelty in these connections by a constable or officer of a local authority, has power by order to prohibit the training or exhibition, or to impose conditions thereon. Further, in addition to, or in lieu of, a penalty imposed for an offence under the Protection of Animals Act, 1911, the Court has power to order the removal of the offender's name from the Performing Animals Register, or order his permanent or temporary disqualification from registration.

    EDUCATION

      Knightley School, Staffordshire
      Mr. Messerasked the President of the Board of Education whether his inspectors have drawn attention to the unsatisfactory conditions of the Knightley School, Staffordshire; and whether he proposes to take any steps to compel the governors of the school to effect some improvement especially in hygiene and sanitation?
      The President of the Board of Education (Mr. Butler): I understand from His Majesty's Inspector that the premises of Knightley Church of England School do not fall below the general standards commonly found in village schools. The sanitary arrangements are kept under periodical observation by the school medical officer.
      Mr. Messer: Is it not possible for the Minister to take some definite action to prevent this sort of thing where children are being educated under primitive conditions?
      Mr. Butler: The hon. Member will no doubt await the reforms I have in mind.

      Youth Organisations
      Mr. Norman Bowerasked the President of the Board of Education, on what grounds youth organisations sponsored by political parties have been forbidden to affiliate to local youth committees; and whether, in view of the disappointment which it has caused, he will consider modifying this decision?
      Mr. Butler: I would refer the hon. Member to the reply given on 1st October, 1942, to the hon. Member for West Lewisham (Mr. Brooke) a copy of which I am sending to him.

      School Camps
      Mr. Graham Whiteasked the President of the Board of Education whether he can make a statement with regard to the experience of the 30 school camps-built by the Government at the outbreak of war, including the uses to which they are now being put?
      Mr. Butler: The national camps, which were originally designed as school camps for occupation by successive groups of children drawn from town schools, have, as a result of the war, been utilised as boarding schools for evacuated school children. 25 of them are occupied by elementary schools, two by secondary schools, two by schools for defective children and one by an orphanage. The educational and physical advantages derived by the children attending the camps are beyond doubt.

    WIDOWS' PENSIONS
    Mr. Fosterasked the Minister of Health whether, in view of the increasing number of widows who have been deprived of pensions under the Widows', Orphans' and Old Age Contributory Pensions Act, 1936, owing to the failure of their husbands to make the necessary 104 contributions under Section 5 (1) of the Act, for various reasons, and the hardship caused thereby, he will consider the advisability of steps being taken to modify the number of contributions to be made under that Section of the Act?
    The Minister of Health (Mr. Ernest Brown): The point raised by my hon. Friend will be considered in connection

    351
    with the Government's examination of the proposals contained in Sir William Beveridge's Report.

    PUBLIC HEALTH

      Emergency Domiciliary Medical Service
      Mr. Messerasked the Minister of Health whether he is aware of the need for an emergency domiciliary medical service; and whether he proposes to take any steps to meet this need in view of the shortage of general practitioners?
      Mr. E. Brown: The ordinary practice is for a doctor to make arrangements by which his patients may obtain treatment from a colleague in an emergency when he himself is not available, and I am not aware of any general need for the establishment of collective schemes for this purpose. I do not think therefore that it is necessary for me to take steps for the promotion of such schemes, but where such a scheme is adopted by general consent I am ready to do what I can to facilitate its working.
      Mr. Messer: Does that mean that the right hon. Gentleman has not received the report of the Medical Practitioners' Union on this question?
      Mr. Brown: No, but the evidence is known.
      Mr. Rhys Davies: Is there any arrangement between the right hon. Gentleman's Department and the Fighting Services so that districts shall not be denuded of medical practitioners?
      Mr. Brown: There is a medical priorities committee sittting.

      Tuberculosis Cases (Accommodation)
      Sir Leonard Lyleasked the Minister of Health whether he can give, by counties, the number of reported tuberculosis cases and the shortage of beds needed to accommodate patients?
      Mr. E. Brown: I am uncertain for what figures my hon. Friend is asking in the first part of the Question, and I am communicating with him on this. As the reply to the second part involves a number of figures, I will, with permission, circulate it in the OFFICIAL REPORT.
      Sir L. Lyle: In view of the increasingly serious position with regard to tuberculosis,
      352
      will my right hon. Friend exert a little more pressure—I know that he has exerted some—on the Ministry of Supply to release the material necessary to complete a lot of sanatoria?
      Mr. Brown: We are doing all we can, but the House is aware that the priorities are considerable.
      Mr. George Griffiths: Is it not possible to transfer beds from places where there is not sufficient staff and where there are empty beds to places where they are required?
      Mr. Brown: That is another issue, but I do not think it would solve the problem.
      Following are the figures:

    TUBERCULOSIS.

      ENGLAND AND WALES.
      Number of patients on Waiting List, at 31st March, 1943, who had been waiting for a bed for more than 10 days.

      Pulmonary

      Non Pulmonary

      Bedfordshire

      15

      11

      Berkshire

      9

      1

      Reading

      5

      —

      Total

      14

      1

      Buckinghamshire

      12

      2

      Cambridgeshire

      13

      1

      Cheshire

      33

      11

      Birkenhead

      6

      2

      Total

      39

      13

      Cornwall

      16

      —

      Cumberland

      31

      3

      Derbyshire

      25

      31

      Devon

      41

      —

      Exeter

      —

      3

      Plymouth

      2

      —

      Total

      43

      3

      Dorset

      6

      —

      Durham

      107

      12

      Gateshead

      25

      2

      Sunderland

      6

      —

      West Hartlepool

      3

      1

      Total

      141

      15

      Isle of Ely

      2

      1

      Pulmonary

      Non Pulmonary

      Gloucestershire Joint Board

      Board

      44

      9

      Bristol

      20

      5

      Total

      64

      14

      Herefordshire

      8

      —

      Hertfordshire

      17

      2

      Huntingdonshire

      5

      —

      Kent

      104

      6

      Canterbury

      6

      —

      Total

      110

      6

      Lancashire

      60

      30

      Barrow-in-Furness

      2

      —

      Blackburn

      3

      —

      Blackpool

      22

      1

      Bootle

      2

      —

      Burnley

      3

      —

      Liverpool

      111

      4

      Manchester

      41

      6

      Oldham

      6

      1

      Preston

      5

      —

      Salford

      15

      —

      Southport

      1

      5

      Wigan

      9

      1

      Total

      280

      48

      Leicestershire

      2

      2

      Leicester

      32

      10

      Total

      34

      12

      Lincs. Kesteven

      9

      1

      Lincs. Lindsey

      12

      3

      London

      13

      1

      Essex

      91

      27

      East Ham

      3

      2

      Southend-on-Sea

      3

      —

      West Ham

      3

      —

      Total

      100

      29

      Norfolk

      —

      —

      Norwich

      1

      1

      Total

      1

      1

      Northants

      2

      —

      Northumberland

      —

      —

      Newcastle-on-Tyne

      15

      2

      Total

      15

      2

      Nottinghamshire

      11

      —

      Nottingham

      76

      —

      Total

      87

      —

      Oxfordshire

      19

      4

      Pulmonary

      Non-Pulmonary

      Shrophsire

      9

      —

      Somerset

      17

      3

      Bath

      6

      —

      Total

      23

      3

      Hants

      11

      10

      Bournemouth

      1

      —

      Portsmouth

      10

      11

      Southampton

      17

      —

      Total

      39

      21

      Staffordshire

      —

      —

      Wolverhampton and Dudley Joint Board

      61

      6

      Stoke-on-Trent

      20

      —

      Total

      81

      6

      East Suffolk

      1

      —

      Ipswich

      2

      —

      Total

      3

      —

      East Suffolk

      1

      —

      Ipswich

      2

      —

      Total

      3

      —

      Surrey

      190

      19

      Croydon

      7

      1

      Total

      197

      20

      Middlesex

      188

      23

      East Sussex

      —

      3

      Brighton

      9

      —

      Total

      9

      3

      Warwick and Coventry Joint Board for T.B.

      35

      26

      Birmingham

      18

      4

      Total

      53

      30

      Wight, Isle of

      2

      2

      wiltshire

      10

      9

      Worcestershire

      27

      1

      Worcester

      13

      1

      Total

      40

      2

      Yorkshire—East Riding

      —

      —

      Hull

      9

      —

      Total

      9

      —

      Yorkshire—North Riding

      —

      —

      Middlesbrough

      6

      —

      Total

      6

      —

      Yorkshire—West Riding

      156

      19

      Leeds

      56

      6

      Rothcrham

      2

      —

      Total

      214

      25

      Pulmonary

      Non-Pulmonary

      Wales—

      Anglesey

      3

      —

      Brecon

      3

      2

      Caernarvon

      19

      4

      Cardigan

      4

      1

      Carmarthen

      2

      1

      Denbigh

      4

      1

      Flint

      7

      —

      Merioneth

      2

      —

      Pembroke

      3

      1

      Montgomery

      3

      —

      Glamorgan

      94

      23

      Cardiff

      45

      8

      Merthyr Tydfil

      9

      2

      Swansea

      11

      3

      Total

      159

      36

      Monmouth

      42

      17

      Newport, Mon.

      14

      5

      Total

      56

      22

      National Health Service (Discussions)
      Mr. Quintin Hoggasked the Minister of Health whether he is now in a position to say when a White Paper on the subject of Assumption B of Sir William Beveridge's Report is to be issued?
      Mr. E. Brown: I would refer my hon. Friend to the reply which I gave on 26th May to my hon. Friend the Member for London University (Sir E. Graham-Little).
      Mr. Hogg: In view of the misapprehensions arising from the reported statement of my right hon. Friend to the effect that his proposals are "in the discard," will he give an unequivocal assurance that the Government's acceptance of Assumption B in the Beveridge Report has not been abandoned?
      Mr. Brown: Certainly, Sir.
      Sir Francis Fremantle: Will there be an opportunity for the House to discuss Assumption B?
      Mr. Brown: That is a matter for the House itself, by arrangement.

      Sickness Incidence
      Mr. Rhys Daviesasked the Minister of Health whether he is aware that there is evidence from recent statistics of approved societies that there is a substantial increase in the incidence of sickness among the insured population; and will he inquire as to the extent to which long hours of labour and fatigue resulting from Civil Defence and Home Guard duties are responsible for this and issue a Report on his findings?
      Mr. E. Brown: I am aware that there has been an increase in the incidence of short-term sickness among the insured population. I have however no evidence to suggest that the increase is attributable to the factors indicated in my hon. Friend's Question and I do not think that an inquiry on the lines contemplated by him would serve a useful purpose, since it would be impossible to dissociate these factors from other circumstances arising out of the war.
      Mr. Davies: Is there any contact between the medical department of the Ministry of Health and the Ministries of Labour and Home Security to prevent undue physical strain being brought upon workpeople and thus sending then on to the funds of approved societies?
      Mr. Brown: There is the closest connection between the Departments on this matter.

      Water Supply, Ripon
      Major Yorkasked the Minister of Health whether his attention has been called to the unsatisfactory position of the water supply to the city of Ripon, caused by the lack of supervision, particularly at night, of the reservoir installations; and whether he will rectify the position by arranging for the release of one of the prewar staff from the services?
      Mr. E. Brown: I am aware of the difficulty to which my hon. and gallant Friend refers. My right hon. Friend the Secretary of State for War has agreed to the release from the Army of one of the men previously engaged on this work.

      Death Rates
      Sir Francis Fremantleasked the Minister of Health, respectively, the male and female death rates for 1942 and their comparison with those of 1938?
      Mr. E. Brown: The death rates for males and females in 1942 (civilians only) in England and Wales were 14.4 and 10.7 per i,000 population, and in 1938 they were 12.5 and 10.8 respectively. Direct comparison between 1938 and 1942 is vitiated by the exclusion in 1942 of young and medically selected persons in the Forces.
      Sir F. Fremantle: Is the reduction not very largely due to the introduction and use of the new sulphonomide M. & B. 693 in infectious cases?
      Mr. Brown: That is one element, but there are many other factors. These figures do show the extraordinary strength and character of the British people.
      Sir F. Fremantleasked the Minister of Health the child mortality in 1942 and its comparison with that of pre-war years?
      Mr. Brown: The mortality rate for infants under one year of age in England and Wales in 1942 was 49 per 1,000 births. The corresponding rates for 1936, 1937 and 1938 were 59, 58 and 53, respectively. The death rate for children at ages one to five in England and Wales in 1942 was 3,424 per million population. The corresponding rates for 1936, 1937 and 1938 were 5,508, 5,121 and 4,600, respectively.
      Sir F. Fremantle: Does that answer imply that there has been something like a reduction of one-half in about half-a-dozen years in the case of children under five?
      Mr. Brown: The country will draw its own conclusions, but it is a most satisfactory statement.
      Sir A. Knox: Is this due to the fact that so many doctors are abroad on active service?
      Mr. Brown: That is a very pleasant jibe, but it does less than justice to the magnificent services rendered by the doctors.
      Sir F. Fremantleasked the Minister of Health the death rate in 1942, at ages under 15 years, from diphtheria and its comparison with that of previous years?
      Mr. Brown: The death rate from diphtheria at ages under 15 in 1942 in England and Wales was 192 per million
      358
      population. The corresponding death rates in 1939, 1940 and 1941 were 228, 266 and 280, respectively.
      Mr. Sorensen: Is that due to an improvement in the British character?
      Mr. Brown: Partly to that and partly to adopting modern devices and skilfully using them.
      Sir F. Fremantle: Is it not due to the campaign for immunisation which we hope to extend very largely in the present six months?
      Mr. Brown: That was one of the elements coming under my general phrase.

      Maternity Cases (Accommodation)
      Mr. Sorensenasked the Minister of Health whether in his consideration of future adequate national health and medical services, special attention is being given to the need of providing efficient municipal maternity homes throughout the country; and whether he will state the present number of private and municipal maternity homes and their respective number of beds?
      Mr. E. Brown: In the schemes for the future the provision of adequate accommodation for maternity cases is being considered in common with all other classes of case needing institutional care. According to the latest figures in my Department, there are some 4,100 maternity beds in voluntary institutions, 8,000 in municipal homes and hospitals and over 3,000 in the emergency maternity homes established by my Department, making a total of between 15,000 and 16,000 beds in all.
      Mr. Sorensen: In view of the shortage of beds in maternity hospitals at the present time, can the right hon. Gentleman give an assurance that plans are being prepared to see that every area in the country has an adequate maternity service?
      Mr. Brown: We are doing our utmost under war conditions.
      Dr. Edith Summerskill: Is the right hon. Gentleman aware that he has given that answer on many other occasions? Is he further aware that expectant mothers are turned away from hospitals in this country every day, for lack of accommodation?
      Mr. Brown: No doubt the hon. Lady knows that there are thousands more beds than there were when the war broke out and that their number is still being added to.
      Sir F. Fremantle: To what extent has the recent call for an increased service of nurses and midwives affected the situation?
      Mr. Brown: I would like to see that question on the Paper. As the House knows, we have been taking very active steps in this matter.
      Mr. Sorensen: Will not the right hon. Gentleman make a special inquiry into this urgent matter?
      Mr. Brown: There is no need for a special inquiry. We know the facts, and we are working hard to make the maternity services as effective as they can be made.

    HOUSING

      Agricultural Workers
      Mr. De la Bèereasked the Minister of Health whether he has conferred with the Minister of Agriculture with a view to arriving at a programme and target to be achieved in building farm-workers cottages for 1944, in view of the inevitable delay which arises after the programme has been sanctioned?
      Mr. E. Brown: I am keeping in close touch with my right hon. Friend with a view to undertaking the maximum possible programme that the resources of labour and material may permit.
      Mr. De la Bère: Do the Government really take any account of the time factor, and is it not a fact that in all probability there will be no completed houses for farm workers in 1943? It really is not good enough.
      Mr. Brown: My hon. Friend's Question asks about 1944.
      Mr. De la Bère: My right hon. Friend knows better than to argue against the facts; it is very wise.
      Major Lyonsasked the Minister of Health whether tenders for the authorised 3,000 rural cottages will be allocated on a basis of time of completion as well as of price; and whether, as yet, he is in a position to give an estimate of the average
      360
      number of weeks required for completion of building and the estimated all-in cost per cottage?
      Mr. Brown: The answer to the first part of the Question is that price is at present the primary consideration, but the period for completion will also be borne in mind. The answer to the second part of the Question is "No, Sir."
      Major Lyons: Can the right hon. Gentleman say when he expects the first real, active steps will be taken for the erection of the first of these cottages?
      Mr. Brown: As soon as we are able to approve tenders.
      Major Lyons: Will that be this year or next?
      Mr. Brown: Quite shortly.
      Mr. Higgs: Is the Minister aware that quotations as high as £2,400 for a pair of cottages are being received, and does he think that in these circumstances the proposition is worth proceeding with?
      Mr. Brown: My hon. Friend is taking something he has seen in the newspapers. He had better wait until I can give an answer and he can see the whole lay-out. He will find the figures much below that.
      Sir Herbert Williams: Is my right hon. Friend aware that before the war we were building twice as many houses as this every week?
      Mr. Brown: I am quite aware of that, but we are at war.
      Sir Percy Hurdasked the Minister of Health whether the attention of his Central Housing Advisory Committee has been drawn to the model of a rural worker's dwelling on exhibition in Edinburgh embodying the ideas of 30,000 Scottish women as to the style and interior of the dwelling best suited to the needs of the rural worker; and whether, in view of the year's housing programme which rural district councils in England and Wales are being asked to prepare, he will have the best ideas of English and Welsh housewives embodied in models and sent on tour through the rural centres of this country?
      Mr. Brown: I understand that this model was designed by an architect in private practice at the request of the Scottish Women's Rural Institutes to illustrate

      361
      suggestions put forward in evidence by members of the Institutes to the Scottish Housing Advisory Committee. The Sub-Committee of my own Central Housing Advisory. Committee which is also considering the design of post-war dwellings under the chairmanship of Lord Dudley is in touch with the Scottish Committee and has been supplied with copies of all the evidence submitted to it. Lord Dudley's Sub-Committee has also received evidence from a number of bodies well qualified to represent the point of view of working housewives in England and Wales and the type plans circulated to Rural District Councils in connection with the emergency scheme for agricultural cottages included plans recommended by the Sub-Commitee after considering this evidence. These were, however, interim recommendations, and I understand that the Sub-Committee's final report will not be ready before the end of the summer. I intend that the recommendations in the Report shall receive the widest publicity, and I will certainly give sympathetic consideration to my hon. Friend's suggestion.
      Sir P. Hurd: Does that relate to the circulation, on tour, of a type of model for the inspection of housing authorities as well as the community?
      Mr. Brown: The English Committee are very keen on models, and the Rural Housing Sub-Committee recommended to the main Committee in January last that consideration should be given to their preparation.
      Mr. Cocksasked the Minister of Health what progress has been made in the erection of the 3,000 rural cottages which the Government have stated are to be completed this year?
      Mr. Brown: By 28th May sites had been selected and approved for 2,734 houses, and plans had been approved for 1,624. Tenders for substantial numbers are expected soon, and I hope shortly to be able to make a general statement on the scheme.
      Mr. Cocks: Could the Minister say what has been the cause of these delays in building these cottages and also whether the Government are still deter' mined that the cottages shall be built this year?
      Mr. Brown: That, of course, is our intention, but my hon. Friend will understand that there is a mass of detailed work to be done to get to the point where tenders can be approved, and the selection of sites in 382 rural districts has meant a considerable amount of hard, detailed work.
      Mr. Moelwyn Hughes: When the right hon. Gentleman talks about the approval of tenders does he mean approval by the local authorities concerned or approval by himself?
      Mr. Brown: I meant the approval of tenders by myself. My hon. Friend will understand that all the tenders have to come to me for approval.
      Mr. Hughes: Is it not a fact that a good many tenders have now been approved by local authorities?
      Mr. Brown: Oh, yes, but they have to have my final word.
      Mr. Colegate: Can the right hon. Gentleman assure us that his colleague the Minister of Labour has agreed to release sufficient building labour to enable these cottages and others to be built?
      Mr. Brown: Both labour and materials will have the highest priority.
      Earl Wintertonasked the Minister of Health the latest estimate of the shortage of cottages required to house married workers permanently employed in agriculture; and whether such an estimate includes cottages condemned before the war under the Housing Acts but still occupied?
      Mr. Brown: The Government have in contemplation a ten-year programme of house construction, which would include about 300,000 cottages for agricultural workers, to cover all needs including the replacement of unfit property and other needs.
      Earl Winterton: Do I understand the answer of the right hon. Gentleman to be that the shortage of cottages at present is 300,000?
      Mr. Brown: Including the second part of my answer, the figure includes cottages under repair.
      Earl Wintertonasked the Minister of Health when his Department first informed rural district councils that per-

      363
      mission had been given for the immediate construction of 3,000 cottages for agricultural workers; whether work has yet commenced on the erection of any of them; and, if not, whether he will take steps to accelerate their construction by the reduction of the number of authorities to be consulted or in other ways?
      Mr. Brown: Rural district councils were authorised on 4th February to make preliminary arrangements, including selection of sites and plans and the obtaining of tenders. In view of the importance of the price of houses, acceptance of tenders requires, my approval. A number of tenders have now been received from districts through-out the country and hope shortly to be in a position to announce the decision of the Government in regard to them.
      Earl Winterton: Is the right hon. Gentleman aware that Members in all parts of the House with a knowledge of rural conditions are seriously concerned at the administrative failure to give effect to this promise, and that we shall certainly approach the Prime Minister on his return and ask him for an inquiry into this administrative scandal?
      Mr. Brown: I do not agree to that at all, but the noble lord will take his own course.
      Major York: Is my right hon. Friend aware that owing to changes of mind regarding the type of houses there are still certain rural districts which have not yet settled on the type?
      Mr. Brown: There are very few now.
      Mr. Lipson: Can the right hon. Gentleman say how many tenders he has been asked to approve up to date?
      Mr. Brown: No.
      Mr. De la Bèere: May I make a most vigorous protest against what is happening—a very vigorous one?

      Discrimination against Children
      Mr. Hannahasked the Minister of Health whether he will consider making it illegal for any landlord in letting houses or flats, to discriminate against tenants merely because they have children?
      Mr. E. Brown: I do not consider that Action on the lines suggested by my hon.
      364
      Friend would be practicable. As he will be aware, my powers of billeting and requisitioning are sufficient to enable me to ensure that the needs of persons who are required to move in connection with the war effort are met.

    BOMBING POLICY
    Wing-Commander Hulbertasked the Prime Minister whether the policy, announced on 27th May, in regard to the use of air bombing against the Axis Powers has the full support of all the United Nations?
    The Deputy Prime Minister (Mr. Attlee): I have no reason to believe that our policy in regard to the use of air bombing against the Axis Powers does not have the full support of the United Nations.

    DAY OF NATIONAL PRAYER
    Dr. Littleasked the Prime Minister whether he has considered the resolution, a copy of which has been sent to him, of the Ulster United Prayer Movement asking for a weekday to be set apart for prayer; and whether he proposes to comply with that desire?
    Mr. Attlee: The proposal to which my hon. Friend refers will be borne' in mind.

    AGRICULTURE

      Bovine Tuberculosis (Immunisation)
      Mr. E. P. Smithasked the Minister of Agriculture whether he has considered a letter in "The Farmer and Stockbreeder," of 20th April, a copy of which has been sent to him, describing the satisfactory results obtained at Pembury in Kent, in immunising a dairy herd against tuberculosis; and whether he will investigate the methods therein described?
      The Minister of Agriculture (Mr. R. S. Hudson): The reply to the first part of the Question is in the affirmative. With regard to the latter part, there is no scientific evidence that the method of treatment referred to has any value for immunisation against tuberculosis, but I shall be prepared to consider any such evidence that may be submitted.

      Government Policy
      Mr. De la Bèreasked the Minister of Agriculture (1) whether he has now had an opportunity of fully considering the plans and proposals put forward by the Council of Agriculture for England; and what conclusion the Government have come to regarding these matters?
      (2), whether it is the policy of the Government to establish commissions to control the import and distribution of foodstuffs and the development of marketing ports at the earliest opportunity after the cessation of hostilities; and what steps the Government are taking to ensure that there shall be no restriction of home production in future years?
      Mr. Hudson: I have received the report on long-term agricultural policy adopted by the Council of Agriculture for England at their meeting on 26th May, and this report, along with those published in recent months by other bodies, will receive full consideration. As to the other points, I would refer my hon. Friend to the reply given by the Deputy Prime Minister to the hon. Member for Harborough (Mr. Tree) on 11th May.
      Mr. De la Bère: Are we to understand that all relevant facts are being considered and that the usual Government policy of stagnation will be vigorously pursued?
      Brig.-General Clifton Brown: Is it not a fact that this Council is representative of all sections of the agricultural community, and will the right hon. Gentleman give some indication of whether the Government's policy is one of approval of the report?
      Mr. Hudson: That is one of the relevant facts which will be borne in mind.

      Uncultivated Land, Industrial Areas
      Mr. Fosterasked the Minister of Agriculture whether he is aware that there are large plots of land in industrial areas suitable for cultivation lying idle and derelict; is he satisfied that his Department or the local authorities have got sufficient powers for taking over such land for cultivation purposes, either as allotments or by local farmers; and, if not, will he take further powers?
      Mr. Hudson: I am not aware that any large extent of land suitable for cultiva-
      366
      tion in industrial areas is lying idle and derelict, but if the hon. Member will quote any specific instance, I shall be glad to look into it. I am satisfied that my existing powers under Defence Regulations are adequate to secure the cultivation of any such land, so far as is practicable.
      Mr. Foster: Is the right hon. Gentleman not aware that speculators bought land before the war and cleared off allotment holders and are now holding up that land for building purposes, so that at present it is lying derelict, although it might be made to serve a useful purpose in growing food?
      Mr. Hudson: I have just said that I did not know of any cases. If the hon. Member has a specific case and will let me have the particulars, I will have it dealt with.
      Mr. Foster: I will send the case on.

    TOWN AND COUNTRY PLANNING

      Gardens and Open Spaces (Railings)
      Lieutenant-Colonel Sir Thomas Mooreasked the Minister of Town and Country Planning, how far responsibility lies with him for initiating negotiations for the future of the gardens and open places in cities and towns, and especially in London, from which the railings have been removed?
      The Minister of Town and Country Planning (Mr. W. S. Morrison): The general responsibility for formulating proposals in regard to open spaces, whether railings have been removed from them or not, rests with the planning authorities concerned, and, when the Bill now before Parliament becomes law, all areas will be the subject of schemes under the Town and Country Planning Act, 1932, which are submitted to me for approval. I would also refer. my hon. and gallant Friend to the provisions of the London Squares Preservation Act, 1931. In the case of the Royal Parks the responsibility lies with my noble Friend the Minister of Works.
      Sir T. Moore: Has my right hon. Friend, his Department or the Government any general policy of preservation of parks, squares and private property respectively?
      Mr. Morrison: There is a policy to preserve these squares as far as possible.

      Green Belts
      Mr. Bossomasked the Minister of Town and Country Planning how it is intended that local authorities should proceed to acquire land for their post-war housing estates, even enough to comply with their first-year programme, until the Government has decided upon its policy regarding green belts surrounding built-up areas?
      Mr. W. S. Morrison: As my right hon. Friend the Minister of Health informed the hon. Member on 10th May, there are many areas in which housing sites can be chosen which do not raise any such question. In any case, close co-operation between my Department, the Ministry of Health and the Ministry of Agriculture, both in the region and at headquarters, will secure that sites are not selected without due regard to the need for green belts and to other requirements of good planning.
      Mr. Bossom: Is the country to infer from that answer that green belts have been adopted, as a policy, by my right hon. Friend's Department?
      Mr. Morrison: The position is that, where they can be provided, green belts are desirable.
      Mr. Bossom: Would my right hon. Friend be kind enough to answer my question? We all know that green belts are desirable, but is it the policy of the Ministry of Town and Country Planning to provide green belts?
      Mr. Morrison: In all proper cases.

    INTEREST-FREE LOANS
    Mr. Lipsonasked the Chancellor of the Exchequer the amount of free-of-interest loans he has received since the outbreak of the war?
    The Chancellor of the Exchequer (Sir Kingsley Wood): £56,859,000.
    Mr. Lipson: How many individual loans are covered by that amount? Has the National Savings Committee had its attention drawn to this particular matter?
    Sir K. Wood: I think my hon. Friend had better put that question down.
    Mr. Lipson: May I have an answer to the second part of my question?

    EIRE (REMITTANCES FROM THE UNITED KINGDOM)
    Dr. Littleasked the Chancellor of the Exchequer the total amount of money from the United-Kingdom of Great Britain and Northern Ireland that has been forwarded to Eire by cheques, money, postal and telegraph orders, for each of the years since the outbreak of war?
    Sir K. Wood: As the answer involves a table of figures, I will, with my hon. Friend's permission, circulate it in the OFFICIAL REPORT.
    Following is the table:

    The figures for money orders and postal orders are as follow:

    For the Year ending 31st August

    For the Half-Year ending 28th February 1943.

    1940.

    1941.

    1942.

    £000

    £000

    £000

    £000

    Money Orders*

    645

    1,185

    3,410

    2,550

    Postal Order

    404

    339

    425

    270

    *Including telegraphic Money Orders, for which separate figures are not kept.

    Figures for remittances by cheque are not available.

BUSINESS OF THE HOUSE
Mr. Arthur Greenwood: May I ask the Deputy Prime Minister whether he will state the Business for the forthcoming Sittings?
Mr. Attlee: The Business for the forthcoming series of Sittings will be as follows:
First Sitting Day—Supply (9th allotted day) Committee. A Debate will take place on Housing and Health in Scotland.
Second Sitting Day—Committee and remaining stages of the Pensions and Determination of Needs Bill, and consideration of Amendments to the Catering Wages Bill which are expected to be received from another place.
Third Sitting Day—It is proposed to adjourn for the Whitsuntide Recess.
Lieut.-Colonel Sir Ian Fraser: Can the right hon. Gentleman now state whether the Government will give a day, and if

369
so, when, for a Debate on the Motion which stands in my name and in the name of Members of all parties, asking for a Select Committee on war pensions?
Mr. Attlee: With regard to the specific Motion, I should not like to bind myself at the moment. I understand that the Minister of Pensions is making a comprehensive review of all those subjects which were raised in the recent Debate and suggestions put forward from other quarters, and until that review has been made I think it will not be reasonable to have the Debate. It will be better to await the result of that review being made, and the House will then be able to have a full Debate on the matter.
Sir I. Fraser: Does the right hon. Gentleman realise that the Select Committee which was set up in 1919 reported to this House within 3½ months of its setting-up upon all the contentious matters which were then disturbing people, and that 2½ months have already passed since we had a big Debate in this House? Can he assure us that the matter will be pressed forward? If the Minister has proposals to make which might render a Select Committee unnecessary, can he not tell the House, by answer to a Question, for example, so that we can consider our action before the Debate takes place?
Mr. Attlee: I can assure my hon. and gallant Friend that this matter is being pressed forward. I have given full consideration to the suggestion made with regard to prior statements for information.
Mr. Greenwood: Is the proposal to undertake a review to be presented to the House by the Minister of Pensions in the form of conclusions? If so, could that not be made the basis of a Debate such as hon. Members desire?
Mr. Attlee: That is another point which I shall take into very full consideration. Obviously it is one way in which there might be a Debate.
Mr. Greenwood: Does my right hon. Friend realise that this matter has been before the House for some time and that there is a certain amount of feeling on the matter? Will my right hon. Friend be good enough to make the most convenient arrangement at the earliest possible date, as I am sure it would meet the wishes of the House?
Sir H. Williams: When is it likely that the Motion will be taken for continuing for another year the Emergency Powers Act?
Mr. Attlee: I understand that it has to be taken before July.
Mr. Buchanan: Will the right hon. Gentleman consider fixing the pensions Debate for an early date, and in addition issue a White Paper with the Minister's proposals, so that we can have some idea of the remedies he is proposing to meet the situation? As to the Scottish Business which has been announced, in view of the serious and urgent nature of matters connected with Scottish housing and health, as is now admitted by all, is it proposed to suspend the Rule so as to give extra time for the discussion?
Mr. Attlee: With regard to the first point, I have already said that that matter will be considered, but with regard to the Debate on Scottish housing and health, we shall consider the suggestion, and if there is a general desire for an extended Debate, it will be met.
Mr. A. Bevan: It was difficult to catch the annoncement on Business over here. Is it intended to take the Committee stage and the remaining stages of the Pensions and Determination of Needs Bill on the second Sitting Day?
Mr. Attlee: Yes, we hope to take that.
Mr. Bevan: Will the right hon. Gentleman take into consideration between now and then that there may be a little controversy over this, and that he should content himself with the Committee stage alone?
Earl Winterton: May I ask the right hon. Gentleman to make quite clear the pledge which he has given to my right hon. Friend the Member for Wakefield (Mr. Greenwood)? I understand that he has undertaken that at the earliest possible date there will be a comprehensive Debate on pensions. Do I understand from that promise which he has given that that is contingent upon a decision being reached by the Minister of Pensions, or are the Government as a whole concerned to see that the Minister of Pensions comes to some decision at the earliest possible date?
Mr. Attlee: I do not quite see the difficulty. The point is that the Minister of

371
Pensions is pressing on with this inquiry and reviewing all these subjects. As soon as he can come to a conclusion it is the desire of the Government that there shall be an opportunity for the House to debate it. I have also said that consideration will be given to issuing a Paper on the subject in advance in order that there may be that subject matter for the Debate.
Earl Winterton: Is the right hon. Gentleman not aware that we have been asking for this Debate for weeks and weeks? In view of the almost unanimous feeling in the House that there must be some discussion, surely the Government as a whole will make themselves responsible for seeing that a decision is reached by the Minister of Pensions at an early date?
Mr. Attlee: The noble Lord will realise that we had a Debate on 23rd March. A very large number of points were raised, and these are being looked into by the Minister of Pensions, and he has said that he is coming to a decision on these matters as quickly as possible. As soon as the Government have had those decisions, the matter will be brought before the House for discussion. I do not really think there is any difficulty. The Government desire to have this Debate as soon as we are in a position to have the decisions on which that Debate can be held.
Miss Rathbone: Will the right hon. Gentleman give consideration to the wishes for a discussion at an early date of the very widely signed notice of Motion in the name of the hon. and gallant Member for Erdington (Group Captain Wright) and a great many other Members on the question of the trend of the population and the alarmingly low birth rate.
[That this House views with alarm the continuing low birthrate and the resulting approach of a decline in population so steep as to menace the future security and prosperity of the British nation and race, and urges His Majesty's Government to adopt all possible measures, economic and educational, to avert this danger, including the introduction at the earliest practicable date of a scheme of children's allowances and improved social services, as already approved in principle by His Majesty's Government.]
Mr. Attlee: I think it will be difficult to find time for a Debate on that Motion, but the matter can be raised very fully on the Estimates of the Ministry of Health.
Mr. Evelyn Walkden: Is the right hon. Gentleman aware, if I may refer back to' pensions, that the questions refer not only to the Ministry of Pensions, but that the Ministry of Health is involved, that the Ministry of Pensions on the one hand gives to dependants pensions or allowances, and the Ministry of Health takes them away. Cannot we have the whole matter examined either by a Select Committee or some Cabinet Committee, but some other committee removed from the Ministry of Pensions, because otherwise the answer will still be unsatisfactory?
Mr. Attlee: That is a different matter. I was dealing with a specific point about the Ministry of Pensions.
Sir Irving Albery: Can the right hon. Gentleman give some indication as to about what time this House will be asked to approve the renewal of the Defence Regulations?
Mr. Attlee: I did answer that question: perhaps the hon. Member did not hear my answer to the hon. Member for South Croydon (Sir H. Williams), I think, sometime in July.
Mr. Buchanan: About the Pensions and Determination of Needs Bill, I understood from the right hon. Gentleman's answer that he was intending to take all the remaining stages—the Committee stage and the Third Reading on the second Sitting Day. That means in fact that the Government have closed their minds to any Amendment, because there must be a Report stage if there is any Amendment. Might I ask him not to press on with all the remaining stages but to leave his mind open for the discussion in this House?
Mr. Speaker: That is not a question on Business.
Mr. Buchanan: The right hon. Gentleman has said he is going to ask the House to take all the remaining stages of the Bill. May I ask him to leave his mind open to see whether amendment of the Bill is possible?
Mr. Attlee: I only expressed a hope, as usual, that we might take all stages. We shall have to see how it goes.
Major Braithwaite: I view of the serious position in the coalfields, and the request of the Prime Minister, will an early opportunity be given to the House for a discussion on the coal situation?
Mr. Attlee: We can certainly consider that.

HOUSE OF LORDS DEBATES (QUOTATIONS).
Mr. Mander: I beg to ask you, Mr. Speaker, a question of which I have given you notice, whether you will be good enough to give guidance to the House as to the conditions under which quotations may be made from speeches made in another place, either in the current Session or another Session?
Mr. Speaker: I am obliged to the hon. Member for giving me notice. The Rule is that Hon. Members must not refer to any Debate of the same Session in the House of Lords—Rule 155 (III), Manual of Procedure. This Rule is not always easy of enforcement. My predecessor has ruled that an announcement of Government Policy made in the House of Lords could be debated in the House of Commons. This therefore should be regarded as the only exception to the above Rule.
In these days, when daily reports of Debates in the other House are published, there is often a temptation to take notice of what has been said there, but it must be remembered that the Rule that allusions to Debates in the other House are out of Order prevents fruitless arguments between Members of two distinct bodies who are unable to reply to each other.
I have stated the conditions under which quotations may be made from speeches in the House of Lords, and I hope that this will remove uncertainty from the minds of hon. Members. The application of the Rule often presents difficulties, and I think the Chair can be safely entrusted with some latitude in its enforcement.

HOUSE OF COMMONS MEMBERS' FUND
Return presented,—relative thereto [Ordered 2nd June; Sir G. Courthope]; to lie upon the Table.
BILLS REPORTED

  GRAND UNION CANAL BILL [Lords]
  Reported, with Amendments, from the Committee on Group A of Private Bills (with Report on the Bill).
  Bill, as amended, and Report to lie upon the Table. Report to be printed.

  MARRIAGES PROVISIONAL ORDER BILL
  Reported, without Amendment, from the Committee on Unopposed Bills; to be read the Third time upon the next Sitting Day.
  MINISTRY OF HEALTH PROVISIONAL ORDER (WETHERBY DISTRICT WATER) BILL
  Reported, with Amendments, from the Committee on Unopposed Bills; as amended, to b considered upon the next Sitting Day.
  MINISTRY OF HEALTH PROVISIONAL ORDER (HARROGATE) BILL
  Reported, with Amendments, from the Committee on Unopposed Bills; as amended, to be considered upon the next Sitting Day.
  MINISTRY OF HEALTH PROVISIONAL ORDER (BUCKS WATER BOARD) BILL
  Reported, without Amendment, from the Committee on Unopposed Bills; to be read the Third time upon the next Sitting Day.
  MINISTRY OF HEALTH PROVISIONAL ORDER (BANBURY. WATER) BILL
  Reported, with Amendments, from the Committee on Unopposed Bills; as amended, to be considered upon the next Sitting Day.
  MINISTRY OF HEALTH PROVISIONAL ORDER (CHILTERN HILLS SPRING WATER) BILL
  Reported, without Amendment, from the Committee on Unopposed Bills; to be read the Third time upon the next Sitting Day.

MESSAGE FROM THE LORDS
That they have agreed to—
Consolidated Fund (No. 3) Bill, with-out Amendment.
Catering Wages Bill, with Amendments.

CATERING WAGES BILL.
Lords Amendments to be considered upon the next Sitting Day, and to be printed. [Bill 41.1]

BUSINESS OF THE HOUSE.
Ordered,
"That the proceedings on the Telegraph Bill be exempted, at this day's Sitting, from the provisions of the Standing Order (Sittings of the House)"—[Mr. Attlee.]

ORDERS OF THE DAY

  FINANCE BILL
  Considered in Committee. [Progress, 2nd June.]
  [Major MILNER in the Chair)

  FINANCE BILL

    NEW CLAUSE.—(Easter Offerings.)
    Easter offerings made to clergymen or other ministers of religion, up to a maximum of fifty pounds in any one year, shall not be regarded as income for any of the purposes of the Income Tax Acts for any future year of assessment.—[Mr. Ivor Thomas.]
    Brought up, and read the First time.
    Mr. Ivor Thomas: I beg to move, "That the Clause be read a Second time."
    In doing so, I should like to clear away a misapprehension which may exist in some quarters. This new Clause is not intended to benefit the clergy of the Established Church alone. Its terms show clearly that its benefits could be claimed, and no doubt would be claimed, by ministers of all denominations. If it should lead to a wider appreciation of the significance of Easter among all denominations, I think the Clause would be doubly blessed. I hope that the
    Chancellor of the Exchequer, as a good
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    Wesleyan, will appreciate that point. The Clause is designed to remove a grievance which has become more acute as the screw of taxation has been tightened. Easter offerings are wholly voluntary gifts made to an incumbent by such of his parishioners as feel so disposed, and it is a general principle of our law of taxation that gifts are not subject to Income Tax. If the Chancellor of the Exchequer in a mood of cherubic benevolence were to hand me a £1 note over the Table, or even a few units of "bancor," I should be under no obligation to include that in my Income Tax return; but if I, out of my heavily-taxed income, give a £1 note to the vicar of my parish at Easter, then the vicar would be subject to all the rigours of the law if he did not include that in his Income Tax return. In practice, if I wish to give a £1 note to 'the vicar of my parish at Easter, I am obliged at the same time to give an Easter offering of £1 to the Chancellor of the Exchequer, which is not my intention at all.
    The assessment of Easter offerings for Income Tax thus contradicts a fundamental principle of our law of taxation. It discriminates against a body of men who render great service to the community, often for very meagre returns. How has this paradox come about? So far as can be seen, it was not the intention of the House that Easter offerings should be taxed. The law under which they are taxed is judge-made law. I do not dispute that judge-made law is as authoritative as Statute law, but I hope to show that there are at least elements of doubt about the grounds upon which the learned judges came to their decision. Income Tax was reintroduced in 1842 by an Act which made provision for levying a duty in respect of offices, employments or pensions
    "on all salaries, fees, wages, perquisites or profits whatever, accruing by reason of such offices, employments or pensions."
    It is extraordinary, if the case for taxing Easter offerings is so obvious, that the astute officials of the Inland Revenue thought for over 6o years that this provision did not cover Easter offerings. These obviously are not "salaries, fees or wages." They are not "perquisites" within the legal meaning of that term, nor in any rational meaning of the word can they be regarded as "profits." But the

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    tax-gatherers' net has been spread ever more widely, and about 1905 the Inland Revenue made a determined effort to get Easter offerings into the bag.
    The attempt caused dismay among the clergy, and the Easter offering at East Grinstead was made a test case. It has come down into history as Blakiston v. Cooper, and is the sole basis on which Easter offerings are taxed. The Income Tax Commissioners decided that the sum of 06 then collected was not subject to tax, and, in the lower court, Bray J. confirmed that decision; but the decision was reversed by the Court of Appeal and another place upheld the Appeal Court's decision. That is the basis on which Easter offerings have been taxed ever since. As it has been decided in another place that this is the law, it is the law, whatever Members of this House may have intended in 1842. But what the judges have done this House can undo. It has often happened that a Statute, as interpreted in the courts, brings consequences which this House never intended.
    If the Committee will bear with me, I will give some reasons why in this case the law as interpreted in the courts should now be amended. As I have said, it is a general principle of taxation that gifts are not to be regarded as income. More precisely, according to Halsbury's "Laws of England," "gifts or voluntary allowances are not income in the hands of the recipient unless they are attached to and form part of the emoluments of an office, employment or vocation." The contention behind this proposed new Clause is that Easter offerings are not part of the emoluments of an office. They are gifts made to an individual in virtue of his personal qualities. The parishioner is absolutely free to give anything or nothing; to make a gift one year and to withhold it the next; to make a gift to one man he likes and withhold it from his successor whom he dislikes. The Rev. A. D. Light may get a bumper offering, but his neighbour the Rev. 0. Howe Boring may not even care to ask for one. In codnsidering his gift the parishioner will take into account such qualities as the incumbent's skill in preaching or the number of orphreys on his chasuable, according to his standards. If the parishioner is a Tory and the incumbent preaches Beveridge, the parishioner will
    392
    probably give nothing. If the parishioner is a Socialist and the incumbent puts Empire Day on a level with Ascension Day, he will probably give nothing. The mellifluousness of his voice, his attitude at the sick bed, the degree 'of his friendliness with the Girls' Friendly Society—these are the kind of qualities that induce the making of gifts. In short, the parishioner makes the gift to the vicar as a man and not to the vicar as a vicar. If I may make a subtle distinction in the Latin of the courts, it is true that the gift is made to the clergyman because he is a clergyman, but the fact that he is a clergyman is a causa sine qua non and not a causa causans. A present of grouse may be made by a patient to a doctor because he is a doctor, but the doctor would not be required to show it in his Income Tax return.
    I hope I have said enough to prove to the Committee that Easter offerings are a personal gift to the man and not "profits accruing from an office." If not, my contention can be supported by a comparison of Eastern offerings with other emoluments of the clergyman's office. I refer to the fees which he receives from such rites as churchings, marriages and funerals and such grants in augmentation of his income as he may receive from the Additional Curate Society and similar bodies. These fees and grants are paid in respect of the office and not in respect of the man, and, as such, they are properly subject to tax. The fee paid for a funeral, for example, is a fee paid for services rendered, and the personality of the clergyman does not arise. A grant made by the Additional Curate Society for a second curate in a parish is a grant in respect of the office, and the curate may not even be appointed when it is made. I believe I have only to cite these facts to make it clear to the Committee that Easter offerings belong to an entirely different category.
    I am not without hope that the Chancellor of the Exchequer, being a reasonable man, will accept this argument. But, like all Chancellors, he will not agree that two' and two make four unless he sees what use. We are going to make of the concession. He is afraid that if he opens the door someone will take it off its hinges. I hope that the limit of £50 mentioned in the Clause will, in this case, dissipate all his fears and remove all pos-

    393
    sibility of abuse. This limit, which is the amount of a fair Easter offering, is intended to ensure that the benefits of the Clause will be effective only as regards bona fide Easter gifts, such as were in existence before Income Tax was invented—and for those not familiar with the procedure, I should say that Easter offerings have not sprung up since Income Tax was. introduced for the purpose of evasion, but were in existence for hundreds of years before Mr. Pitt introduced the tax. I would also like to say that this limit distinguishes Easter offerings from the case of the Metropolitan of Thyateira which was in the courts recently.
    In making concessions, Chancellors of the Exchequer are haunted by another consideration, namely, that the loss of revenue must be made good from some other source. The concession now sought, though important to the persons concerned, is a very small item in the national accounts. There are about 12,000 incumbents in the Church of England. On the assumption that each of them receives an Easter offering of at least £50a a year, and that this is subject to tax at the full standard rate, the loss in Revenue would be £300,000 a year; but each one of these assumptions is very much exaggerated, and in practice the loss to the Revenue would hardly exceed £150,000 a year. Moreover, it is my contention that this revenue ought never to have been collected, but we will excuse the Chancellor from repaying the back money.
    There are a few incidental considerations which I would like to urge. The present law—again. "I refer to "Halsbury"—puts Easter offerings in relation to Income Tax in the same category as
    "tips to a waiter, permitted commissions, or presents by owners of racehorses to winning jockeys."
    But there is this difference between them. When the law says that Easter offerings are liable to tax, they are taxed; but when the law says that tips are liable to tax, they are not taxed. I wonder whether the Chancellor would tell us what is the total return under the heading of "tips" in the Income Tax Returns; and if he can produce a jockey who has made a return of a present paid to him by the owner of a horse, I expect the jockey's name to be George Washington. Another consideration is that the taxation of the Easter offerings can be very easily avoided.
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    Perhaps I ought not to use the word "avoided," because it is no more avoidance of taxation than teetotalism is avoidance of taxation. Since we put this Clause on the Paper I have received a large number of ingenious suggestions on the subject, all absolutely watertight so far as I can see; and I personally should see no impropriety in making my gift in such a form as not to attract taxation. If the Chancellor does not make a concession that is bound to happen on an increasing scale; but I do not see why laymen should be forced to vary this ancient and laudable custom of Easter offerings, and I hope that he will concede gracefully what he is bound to lose in any case: In answer to a Question in the House, the Chancellor said that the Royal Commission on Income Tax had considered this matter and had recommended against an increase. I would point out that the Commission dealt with the subject most inadequately, in only nine lines, and the reason given would operate against all gifts of any sort—that the person who received the gift has a greater taxable capacity than the person who does not. That would apply to gifts of every kind.
    I have not based this argument on the poverty of the clergy. That poverty undoubtedly exists, but it would be contrary to the interests of religion to ask for the subsidisation of clerical incomes out of the Revenue, and I do not ask for it. I ask the Committee to approve this Clause in order to remove an injustice which ought never to have been imposed. But having, as I hope, proved the justice of the case, I do not hesitate to use the poverty of the clergy as an argument for acting, and for acting quickly. These men belong to a class of whom the Chancellor observed in the Beveridge Debate:
    " Some of the hardest and most cruel cases I have heard of come from that section of the community.''—[OFFICIAL REPORT, 17th February, 1943; col. 1829, Vol. 386.]
    Here is an opportunity for the Chancellor to be as good as his word. We owe much in our national life to the homes of the clergy. The country parsonage, which gave us Nelson in a former day of trial, has in this war given us Lieut.-Commander Beatty, V.C., the hero of St. Nazaire, and even General Montgomery himself. The austerity of the parsonage may be a necessary part of their training, but do not let us convert that austerity into a chilling penury by unjust taxation.
    The Chancellor of the Exchequer (Sir Kingsley Wood): I do not want to curtail the Debate at all, but I have to leave the Committee for a few minutes as quickly as possible, to attend a meeting that cannot avoid, and I would like to say a few words. I wish to congratulate my hon. Friend upon his excellent speech, but I confess that I thought it rather weak in logical argument. This matter has been often discussed in this House, and even in times of peace, when one could perhaps look at such matters more favourably, the proposal has been consistently rejected. My hon. Friend gave only a partial account of the history of the matter. Not only is the fact that Easter offerings are subject to taxation well-founded law, but I think it is well-founded good sense—which I agree is not always the same thing. It is worth looking at what the Lord Chancellor said when the case of Cooper versus Blakiston was before the House of Lords, when this matter was very fully considered. That was in I999, a good many years ago. The Lord Chancellor said:
    "In my opinion, where a sum of money is given to an incumbent substantially in respect of his services as incumbent, it accrues to him by reason of his office. Here the sum of money was given in respect of those services. Had it been a gift of an exceptional kind such as a testimonial or a contribution for a specific purpose as to provide for a holiday, or a subscription peculiarly due to the personal qualities of the particular clergyman, it might not have been a voluntary payment for services but a mere present. In this case there was a continuity of annual payment"—
    as is the case in all these Easter offerings—
    "apart from any special occasion or purpose, and the ground of the call for subscriptions was one common to all clergymen with insufficient stipends urged by the bishop on behalf of all alike. What you choose to call it matters little. The point is what was it in reality. It is natural and in no way wrong that all concerned should make this gift as like a mere present as they could, but they acted straightforwardly as one would expect and the real character of what was done appears clearly enough from the papers in which contributions were solicited."
    This matter has been discussed on another occasion since that case, and the same opinion was held. My hon. Friend quite rightly reminded the Committee that the matter was the subject also of careful attention by the Royal Commission on Income Tax, and that they were unable to recommend any alteration, although I have no doubt that they would be sympathetic to proposals of this kind.
    Captain Strickland: When my right hon. Friend speaks of the continuity of gifts from year to year, has he given due consideration to the fact that a congregation changes individually from year to year, and that it could never be held that a gift made by A. is similar to a gift made by B. in the succeeding year, when A. has left the parish and B. has come in?
    Sir K. Wood: I do not mean continuity of the same persons. I had a discussion with a clergyman on the subject only a few months ago, and he told me of his particular position, and what he was in fact getting. He quite rightly calculated what would be the average amount that he would receive in respect of the Easter offering for the particular church to which he was attached.
    Mr. Driberg: There is possibly continuity within a single incumbency, but there is not continuity from incumbency to incumbency. The offering may rise or fall quite drastically according to the incumbent's popularity or otherwise, and is therefore surely a personal gift not attached to the office.
    Sir K. Wood: I do not think there is any doubt that but for the office the gift, in fact, could not be made.
    Mr. Ivor Thomas: Does not the right hon. Gentleman appreciate the distinction I made between the causa sine qua non and the causa causans? It is not made to the clergyman because he is a clergyman but made to a vicar because of his qualities as a man and not the incumbent of a particular parish.
    Sir K. Wood: I do not accept that for a moment. It is true that a clergyman who may be more popular than his predecessor might obtain a larger sum but it is impossible to argue in fact that the gift is not given to him by virtue of the office he holds. If he did not have that office, he would not be getting any Easter offering. In all these cases, the clergyman makes an inquiry, as he should properly do, and no one would complain about that. If a certain living were offered to him, one, of the first questions he would ask would be, "What is the general amount I am likely to receive, including the sum I shall in all probability obtain by way of Easter offerings? "That undoubtedly is the case, and if you asked

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    any clergyman he would say that that would be the inquiry, he would put before accepting a particular living. The Royal Commission said:
    "While it is no doubt true that the amount of the Easter offering in any particular parish may depend in part upon the personal circumstances or the personal popularity of the clergyman, yet it is, in our opinion, impossible to ignore the plain sense of the position, which is, that Easter offerings are paid to a clergyman because he is a clergyman and only so long as he remains a clergyman. Of two incumbents, with emoluments and incomes otherwise equal, one of whom receives £100 from Easter offerings and the other nothing, to pretend that the taxability of the first is not greater than that of the second is to shut one's eyes to realities and to give undue weight to a natural sentiment."
    That is a very fair statement of the position.
    Mr. Thomas: We do not pretend that, but that would operate against all gifts of any character because they increase the taxable capacity of the person in receipt of them.
    Sir K. Wood: No, there have been a considerable number of decisions in the courts of law which carefully distinguish between what one might call the casual gift and the contribution such as is made by a particular church in relation to Easter offerings. I have a record here of a number of these cases. Take the case of Reed v. Seymour, where it was held that the proceeds of a benefit match arranged for a professional cricketer, together with subscriptions made to him by the public on that occasion, were not taxable income. The courts very carefully distinguish between a gift given on a special occasion of that kind which is not a regular repeated gift given every year and those which are the subject of the decisions to which I have already referred.
    Sir Herbert Williams: I take it then, that if we have a bazaar every five years and give the vicar a lump sum payment, he will escape taxation? It would be regular.
    Mr. Goldie: Is it not the case that the professional cricketer receives a benefit match and the professional footballer does not?
    Captain Strickland: Would that man have received that benefit match had he not been a cricketer? He is a popular man as well as a cricketer, but had he
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    not been a cricketer he would not have received it. A clergyman may happen to be popular or unpopular, but, incidentally, he is a clergyman.
    Sir K. Wood: I will refer to what the Lord Chancellor said on that occasion. He pointed out that the terms of the cricketer's employment did not entitle him to a benefit; but that in practice a benefit was usually given towards the close of a cricketer's career and in order to provide an endowment for him on retirement; that except in a very special case it was not granted more than once; and that its purpose was to express the gratitude of his employers and of the cricket-loving public for what the cricketer had done and their appreciation. of his person qualities. Lord Phillimore, who was not only a distinguished Judge, but was well-known for his interest in the Church and ecclesiastical matters, devoted a very large proportion of his speech to distinguishing this particular case from the Easter offerings case. He pointed out that the Easter offering might be voluntary, but it was not spontaneous, and in the Easter offerings cases there was an element of recurrence which distinguished them from the case of a single gift to an employee. The practical distinction between the professional cricketer's case and Easter offerings is that the benefit moneys come to the cricketer on one occasion towards the end of his cricketing career and that Easter offerings, on the other hand, represent a recurring annual contribution for the personal use of the recipient. I could give instances of other cases in which this matter has been discussed.
    Sir Francis Fremantle: Is not that affected by the fact that, since that decision was given, the 1919 Church Assembly Act was passed, and these offerings are under the control of the parochial church council, who may in any year say "We will" or "We will not have an Easter offering devoted to this subject"? In the case of livings which are above the poverty line that is very likely to be the case, and it is done, and does not that break the whole argument of continuity?
    Sir K. Wood: If that is the case it shows more and more that it does not rest merely with the person but that the matter is taken into account by the Church authori-

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    ties and according to My hon. Friend is being dealt with by them. I cannot think of a more substantial example of support for the views the judges have taken than that statement, if in fact that represents the practice. If it is true that the Church authorities are now intervening and taking the money and treating it in that way, it shows more than ever that it is being dealt with and must be considered on the lines that the judges have laid down.
    Mr. Driberg: I think the right hon. Gentleman misunderstood what has just been said. The Church authorities are not taking the money and applying it perhaps for other purposes. But the churchwardens can say, if it is a large living or the vicar is a man of substantial private means, that obviously there is less need to give him an actual cash present.
    Sir K. Wood: If that is so, the churchwardens are now intervening and taking the matter into their hands and dealing with it as a Church affair.
    Mr. E. P. Smith: Supposing the Easter offering was not given at Easter but, on the incumbent's birthday, a sum was given by the parishioners individually, would that be subject to Income Tax?
    Sir K. Wood: I should certainly say so. That leads me to another point, and I am glad my hon. Friend has reminded me of it. Why Easter offerings only? Why is this taken to be an exception and a matter for special consideration as far as taxation is concerned? Take the case of the Roman Catholic Church. Very considerable voluntary offerings are given to priests in the Roman Catholic Church, apart from Easter offerings, and they include, I am informed, offerings for particular services of the ministry. In the Catholic Church there are offerings not only at Easter, but at Christmas. If you say, "I will pick out Easter offerings," it would be proper for the Roman Catholic Church to say, "If it is to be Easter offerings, we have offerings at Christmas as well, and therefore, we must have the Christmas offerings exempted." [An HON. MEMBER: There is a limit of £50."] I know, but there may be some who only get money in that particular way. My hon. Friends are optimistic if they think that if the House says it is to be £50, it will stop at that. That has
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    not been my experience in taxation matters. It is a proper and in fact very substantial answer to make that you cannot, if you embark on a matter of this kind, apply it to Easter offerings only. There may be some special circumstances surrounding Easter offerings but some people would quite properly say that it cannot stop there and would say that obviously it must apply to other special offerings given at Christmas, or, in the case of the Roman Catholic Church, to offerings for particular services.
    Captain Strickland: Does not the Chancellor accept a fixed sum with regard to personal allowance? If you make the personal allowance so much it does not mean that it varies from year to year.
    Sir K. Wood: It does very much, and if my hon. and gallant Friend were in my position he would know of the constant pressure brought upon me to vary these allowances. Therefore, my first answer is that the law is quite plain and has been laid down for a very considerable period. It is not only quite plain but very good common sense. Secondly, if you once say that there is to be a special dispensation given for Easter offerings, you cannot stop there. You cannot take the practice of a particular Church and say that in that respect only benefit is to be given by way of relaxation of taxation. You have to look at the position of other Churches who have the right to come forward and say, "If you admit the principle of Easter offerings, we demand that the same principle should be applied to other offerings given at Christmas." I would also say to the Committee that there may be Churches in which there are no Easter offerings. The ministers of these may say, "We do not go in for the practice of Easter offerings. Our stipends are paid in a different way. Why should the clergyman belonging to the Church of England receive special consideration at the hands of Parliament because the remuneration of a clergyman happens to be paid by way of Easter offerings?" That would be a most difficult position and most unsatisfactory to ministers of other denominations. I would also add for the consideration of the Committee that I do not think that to-day of all occasions—this has been objected to many times in the past—Parliament should assist this particular section of the community and give relief

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    by way of taxation. I think that the country would not understand it.
    There is a large number of claims I have had to reject from different sections of the community which have been put forward on practically the same basis. A few minutes ago I had a telegram, evidently an echo of a by-election which is now going on, asking me if I would say why over-time should not be relieved from taxation. Well, I can give a proper answer to that as I can to this. People would say, "You are giving a special dispensation to various ministers of religion in respect of Easter offerings, but you will not give a special dispensation to workers on over-time." I have had other schemes to consider on the same basis; for instance, there was a claim which would appeal to many people—to exempt that portion of a merchant seaman's money which is called "danger money." That has a strong sentimental appeal, but if you once begin—as I explained to them and as they understood—to cut up various components of people's remuneration, you will never finish.
    Sir H. Williams: My right hon. Friend has said that he could not exempt part of the remuneration of a member of the Mercantile Marine. In fact he does so, because the man is paid a substantial amount in kind, which is not taxed.
    Sir K. Wood: We intend to deal with the question of kind when we come to one of the new Clauses later in the day. But that in no way affects the argument I am putting before the Committee, namely, that if one began to differentiate between different elements of, a person's total emoluments it would really be impossible to refuse others. I must maintain the position which has always been maintained in this House. In conclusion, I would like to point out that there would be difficulties, injustices and inequalities between one minister in the Established Church and another who might not have any Easter offerings. I appreciate the position of many ministers of the Established Church—I read a report of theirs the other' day in which proposals were put forward to make things better and more equal—and I would like to see an improvement in the position of many of them, but for the reasons I have given I do not think it would be fair and right to accept this new Clause.
    Mr. Willink: Before the Chancellor leaves the Committee will he consider the matter from this point of view? It is really quite futile to say that the law is plain. This is a question of altering it. The law as it stands arises from the application of legal principles. This may give rise to a position contrary to the general feeling. This has been felt for decades to be repugnant to common sense.
    Sir K. Wood: I stated quite definitely that not only was this the law but that it was common sense as well. I also said that Parliament has always accepted this position.
    Mr. Higgs: When Income Tax was 6d. in the £.
    Sir K. Wood: Yes, when it was much smaller than it is to-day. My hon. and learned Friend the Member for North Croydon (Mr. Willink) must not say that opinion has been such that this matter has caused resentment and feelings of injustice among the great majority of the people. It may be true that it has caused such feelings among a certain number of people—as we have seen in this House to-day—but for the reasons I have given I cannot make any special exemption for a certain section of the community in this respect.
    Mr. Boothby: I would like to support this new Clause. Skilful and adroit though the Chancellor's speech was, it was wholly unconvincing. He did not make any attempt to deal with the principle underlying this Clause, which is a simple one, namely, are these offerings a gift or not, and are they a voluntary gift or not? If they are voluntary, they ought not to be subject to Income Tax; if they are part of the ordinary remuneration of a minister or clergyman, then they should be subject to the tax. I do not think any other point really matters. I cannot persuade myself that they are in essence anything more than a voluntary gift made by a congregation to their minister or priest as- an individual because they like him and for the services he has rendered to them personally. There is no element of compulsion about it whatsoever; there is not even an obligation. I cannot agree with the Chancellor that in these circumstances you can describe these annual gifts as emoluments apper-

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    taining to a particular office or Church. The Chancellor himself made no attempt to deny that they vary greatly in amount from year to year and from individual to individual or that congregations also vary greatly at the same time. There is nothing permanent about these annual gifts except that they take place annually. If they were made more sporadically, every two years or every two and a half years, and at a different time from Easter, I am not at all sure that they would be subject to Income Tax.
    If a gift to a clergyman or minister of religion is used for the specific purpose of taking his family to a seaside or purchasing a motor car, I understand that the gift is not subject to tax, but if it is used to implement the exiguous salaries paid to the vast majority of clergymen in this country in order to help pay for the bare necessities of life, what do the Treasury do? They come along, take half the money out of the plate and pocket it. There might have been something to be said for that when Income Tax was 6d. or 9d. in the £, but there is nothing to be said for it now, when Income Tax is 10s. in the £ I do not believe that many members of congregations fully realize that 10s. in the £ is taken from their gifts by the Chancellor. I am sure that if this question was left to an open vote, we should get a close vote, because there is a strong body of opinion that does not think it right that this should happen. I cannot think it is right to take money from men who are clearly overworked and underpaid and turn what is a thank-offering into a commercial proposition. That is what the Treasury is doing now. The Chancellor, in his speech, quoted the law as laid down by Lord Chancellor Loreburn. But he expressed his views in 1909, when Income Tax was 9d. or a 1s. in the £ At any rate, if we think it is not right, we are perfectly entitled to alter the law. Even if nothing can be done on this occasion I hope the Financial Secretary will give the Committee an assurance that in view of the anxiety which is being expressed this whole matter will be carefully considered between now and the introduction of the next Finance Bill.
    Mr. Moelwyn Hughes: I rise to express the hope that the Government will not accept this new Clause.
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    There is no class of people in this country who do such a considerable amount of valuable work as clergy and members of the ministry, and they do it for very' little pay. If by any means their position could be eased, I should be only too glad to see it done, for I know something about it, because my father was a minister. We have been using legal terms in this discussion, but looking at this matter from a common sense point of view these- gifts are collections of money given in order to maintain and assist the ministry at a particular church. It is not only on Easter Sunday that the collection plate is passed round for the minister in Nonconformist churches. The whole of a Nonconformist minister's livelihood depends upon an accumulation of offerings, spreading from Sunday to Sunday. They are all gifts. There is no compulsion to make them—I am quoting from arguments used in favour of the Clause—and they vary from chapel to chapel. There is no constancy about them. The minister's salary is not a fixed salary.
    Mr. Ivor Thomas: Almost every Nonconformist minister is paid a fixed salary. It is true that it is received in the form of gifts which may exceed the amount, and then it is diverted to some other purpose. I cannot defend the idea that a person should receive all his income in the form of gifts, because that would mean evasion of taxation.
    Mr. Hughes: I was just about to point out that, although most Nonconformist ministers go to a chapel with the figure mentioned, that figure is not final. I know plenty of cases where the accumulated offerings of the year and the collections towards the ministry are always kept distinct from other collections and if the accumulated Easter offerings exceed the amount that has been mentioned more has been paid. I know cases of ministers who have had year after year to accept less, because, owing to altering conditions of population or whatever it may be, the accumulated offerings have not come up to it. To describe a minister's remuneration as a salary, and to regard it as something equivalent to a commercial contract, is to make a vast mistake. What a minister gets is an accumulation of Easter offerings. If the principle contended for by the Clause

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    is right, no Nonconformist minister should pay a penny of Income Tax. [Interruption.] If the principle justifies the £50 in the one case, it justifies the whole of the offerings in the, other. Nonconformist ministers are probably a saintlier body of men than we here, but they are not in my experience quite so saintly that they like to pay any more Income Tax than is necessary. But in fact they do, and although they do not desire to pay taxation any more than anyone else, I am glad to think that I know of no body of Nonconformist ministers who have ever approached the Chancellor of the Exchequer with the request that they should be completely exempt from paying their share of tax on the ground that all that they receive comes entirely from free and voluntary gifts. On that ground alone, and not because I wish to deprive a worthy body of men of any concession, I resist the Clause.
    Mr. Higgs: I have very great respect for the Chancellor of the Exchequer, but I do not think he ever put up a worse defence. He referred to the legislation of 1909, and my hon. and learned Friend the Member for North Croydon (Mr. Willink) said, "We know the law. We want the law altered." The Chancellor will not have many friends in this matter. He referred to Christmas offerings and so forth, but there is a £50 limit in the next Clause. We are appealing for these people, who comprise the worst paid members of any profession. They have no trade union. The clergy are human, and they want material comforts. They are not in a position to increase their remuneration, as other sections of the community are. Prices are rising, but they are receiving no consideration whatever. The Clause is not tabled solely on behalf of the clergy of the Church of England. It is for all ministers of religion. A career in the Church in any case is a black outlook from the financial standpoint. While people in other walks of life have opportunities of supplementing their income by other forms of employment, that opportunity does not arise for the clergy. The Chancellor made a great point that it would be creating a precedent if he granted this concession. Does he suggest that there are no anomalies at present in the laws of taxation? I cannot see his argument. If all ministers of religion were taken into account, the cost to the Exchequer would not exceed £500,000.
    Mr. Ivor Thomas: It would not be anything like that, because, even if Nonconformist ministers availed themselves of it, it is not money that is now going into the Revenue. The total cost to the Revenue would not exceed £150,000.
    Mr. Higgs: I hope the Clause will be taken to a Division, and, if we do not carry it, it will be defeated by Members in the smoking room who are not familiar with the problem. I appreciate that the Chancellor is paid to look after the public purse, but to refuse this concession is niggardly. A lot of people who contribute to Easter offerings and so forth are not aware that half of it goes to the Chancellor of the Exchequer.
    Mr. Butcher: I think the Chancellor's arguments were completely irrelevant. He told us accurately what the law is, but the whole purpose of this House is to look at the laws that we have and, if we do not like them, to change them. In regard to the remuneration of the clergy, that has been done twice since 1909. Two Tithe Acts have been passed in the intervening period, both of which reduced the remuneration received by the clergy. I think the Chancellor entirely fails to appreciate the position that the ordinary men and women who want to pay a token of respect and regard to the clergy of any denomination are equally anxious that the Chancellor shall not get a 50 per cent. rake-off, and we are moving this Clause to make sure that, when it is said that a collection will be taken on behalf of the incumbent of the parish, it means what it says and it does not mean that a collection shall be taken on behalf of the Chancellor of the Exchequer. I hope this will be taken to a Division.
    Sir H. Williams: The Chancellor of the Exchequer told us that this has been frequently discussed, but I think he is inaccurate. The last discussion was in June, 1925. On that occasion my hon. Friend was in the opposite Lobby from me, because I voted against the Government and he supported it. I welcome him as a sinner come to repentance. The Chancellor's speech was about the worst that he has ever made. There was only one worse, and the hon. and learned Gentleman who made it has left the Chamber to have a meal. Some of us know how badly many ministers are fixed. I was a churchwarden for some years at a church

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    a mile away from here, and I know something about church accounts. If I were a churchwarden to-day, I could get round it without the slightest difficulty. There are dozens of methods. It is a pity that Church authorities and the clergy should be asked to adopt methods for the avoidance of taxation, but it is only necessary to present a piece of jewellery to the vicar's wife and she has only to take it to the jeweller and sell it. It is a perfectly legal transaction. Or they could arrange to buy the vicarage grocery, or they could do as the Archbishop of York has done. His stipend is £9,000 a year. He has arranged with the Ecclesiastical Commissioners to pay the whole maintenance of his office and his castle, and is in future to receive a salary of £4,250 subject to taxation: He and the Ecclesiastical Commissioners have gone through a delightful process for the avoidance of taxation. [An HON MEMBER: "Not avoidance of taxation, but of Surtax."] The Archbishop will pay less in future than in the past. I do not blame him. I think the transaction perfectly honourable. But it contravenes the moral principle of Section 35 of the Finance Act, 1941. I hope it will temper some of the speeches the Archbishop makes in future in discredit of other people. His Grace of York is now travelling in bad company, it seems to me. It is a week-end competition who can talk the most economic nonsense.
    Why continue this injustice? Robin Hood was much more respectable. Here you have the Chancellor robbing the poor. Anyone who has taken the plate round on an Easter Sunday knows that the poorest members of the congregation make an extra effort to contribute. Those who as a rule put a penny in put 6d. in on Easter Sunday, and, of their extra effort, a half is taken by the Chancellor. I think there is an overwhelming case for this Clause. The Chancellor's speech had no relevance to it. This is not a payment in respect of a contract of service. When we last discussed this, Colonel Guinness, now Lord Moyne, was Financial Secretary to the Treasury, and he put up the Government case. You can find most of the Chancellor's, speech to-day in Hansard for June, 1925, in the words of Colonel Guinness. He was so ineffective that he could not convert his own brother, who went into the Lobby against him. On that occasion the only reason why the
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    Government won was that the people who had not heard the Debate flocked 'in to the Government Lobby. It is those who vote blind on these occasions who are the salvation of the Government in their difficulties, as the Government are at this moment in difficulties. One speech in their support was so inconsequential and irrelevant that as soon as the hon. and learned Member had delivered it he left the Chamber as though he could not bear to hear the echoes of it.
    The Financial Secretary is a great ornament of the Church Assembly, and he makes eloquent speeches there. He is the admired of the bishops and the lower orders of the clergy. Surely he is not going to make his presence in that Assembly in future almost impossible by forcing them to point the finger of scorn at him and say, "That is the man who robbed the children's money box." I hope he does not want to go down to fame as the man who, in the absence of the Chancellor of the Exchequer at some important gathering, had to do this really dirty deed, because honestly it is a miserable thing he is asking of us. I hope that he will repent as the hon. Member for East Aberdeen (Mr. Boothby) has repented. He did not sin last time, because he was not here. If he sins to-day, it will be the first time.
    Sir Frank Sanderson: I support this new Clause if for no other reason than that the tax on these offerings is unjust in its incidence. It penalises the poorer parish against the more wealthy parish. In the poor parish the only method by which the vicar receives his Easter offering is by the coppers and silver which are dropped into the collection plate. On this the vicar derives no benefit in taxation relief. In the larger and more wealthy parishes it is well known that it is the custom not to put the Easter offering in the collecting box but to send it direct to the vicar in such a way that it is not subject to. Income Tax. Therefore, as the law now stands we are penalising the poorer clergy as against the wealthier ones. If for no other reason than that we should not penalise one section of tile clergy against another, I support this new Clause.
    Mr. Hannah: I did not want to interrupt the Chancellor when he was speaking, because so many people were doing that. It seems to me that the Chan-

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    cellor's speech will almost certainly be historic in making an excellent suggestion to the Church. The only thing that has to be done—and it is an exceedingly English solution—seems to be to change the name. Instead of calling this thing an Easter offering, the Church has only to make a gift to the vicar or rector for the purpose of repairing his residence, educating one of his children, helping him to take a holiday or something of that kind, and no tax will be payable. There is an unfortunate tradition in this country that nobody can be a Minister of the Crown whose voice can be heard more than 10 yards from where he is standing. The result to-day was that I did not hear everything that the Chancellor said. I would like to know, therefore, whether the whole matter cannot be satisfactorily got over in the way I have indicated, that is, by giving the vicar an offering for some particular purpose. I might draw the Chancellor's attention to the widow's mite. It is rather unsatisfactory that part of such very small gifts should be taken by the Exchequer.
    I wish we could have had it made clear how the nonconforming Churches stand in this matter. I can only say that when I was born I had no fewer than seven relatives in holy orders. I have three sons, and two of them are clergymen. How I survived I do not know, but I did survive somehow or other, and I am much more familiar with the financial arrangements of the Church of England than those of the nonconforming bodies. We should have had made perfectly clear how this new Clause would affect them.
    Mr. McKie: I should like to point out to my hon. Friend that there is another established privileged Church in Scotland which observes no Christian year and in which there is no system of offerings to the clergy such as the Easter offering.
    Mr. Hannah: I am quite familiar with the arrangements of the Church of Scotland. I am in the position of having to pay part of the salary of a Church of Scotland minister, though I am not a member of that Church.
    Mr. Ivor Thomas: As I was brought up as a Nonconformist I can give the hon. Gentleman the information he requires about the Nonconformist Churches. The Free Church ministers are paid salaries on a contractual basis, and these salaries
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    are raised by the gifts of the congregations. I have no doubt that if this new Clause became law the Nonconformist Churches would make a practice of taking an Easter offering so that ministers might avail themselves of these benefits, up to £50 a year.
    Sir George Schuster: I should not have intervened except for the fact that the Chancellor of the Exchequer seemed to be basing himself on what he thought to be the opinion of the Committee. I should like, therefore, to express my opinion. First, I want to record the view that it is a mistake to accuse the Chancellor of stinginess in a matter of this kind or to ask him to be generous. The Chancellor cannot be generous with other people's money; he is merely trying to do what is the right thing. I want to support this new Clause because I feel that the existing position is unjust and contrary to the public interest. I am not arguing it as a matter of law. I will try to express what is in my mind about it in this way. The Church, according to the law, can be regarded as a subject for a charitable gift. If I were to contract to pay to the Church a sum for seven years, it would escape all Income Tax. Therefore, if I, as an ordinary Income Tax payer, contract to pay to the Church £1 a year from my taxed income, the Church will get an income of £2 a year. On the other hand, if I put £1 into a church plate for the Easter offering the incumbent will get only 10s. It seems to me that there must be something wrong in that enormous difference. It will be argued that I have not made the placing of £ into the plate for the Easter offering the subject of a seven-year covenant. On the other hand, the whole of the Chancellor's argument was based on the fact that somehow or other the incumbent is receiving the benefit of a contractual obligation in taking the Easter offering. I feel that somehow or other there is something wrong about it. Of course, if my contributions under a seven-year covenant to the Church were used to pay a definite agreed salary to the incumbent, he would have to pay Income Tax on that. But then at least he would get £1 out of the £1 I gave out of my taxed income. At present he gets only 10s.
    Mr. Benson: I do not quite follow my hon. Friend's argument

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    that if under a seven years' contract he gave £1 the incumbent receive £1. Surely he would receive £1 less tax?
    Sir G. Schuster: My argument was that if I contracted to pay £1 a year out of my taxed income, the Church would in fact get If it used that £2 to pay a regular salary to the incumbent he would get £2 gross, from which if he was a full taxpayer he would get £1, less tax. I need not follow out now the full logical consequences of these considerations. It is enough for my present purpose to say that the net result creates in my mind the impression that a great injustice is being done. As I also feel that in the public interest it is desirable to do something to improve the position of the wretchedly paid clergy, I put my name to this new Clause, and I propose to vote for it.
    Professor Savory: I am sure the Committee greatly appreciates the learned and eloquent speech made by the hon. Member for Walsall (Sir G. Schuster), who put forward clearly the difference between a contractual obligation and a voluntary offering. That distinction was also suggested to my mind by the speech of the hon. Member for Carmarthen (Mr. Moelwyn Hughes). He laid stress upon a point which in a great many churches is not applicable. He said that in the case of Nonconformists, their offerings being voluntary, they made an Easter offering every Sunday in the year and therefore no difference could be made between the usual Sunday offering and the Easter offering. The hon. Member may know Wales, but he does not know Northern Ireland. My hon. Friend the Member for Galloway (Mr. McKie) may speak for Scotland but I challenge his right to speak for Northern Ireland. In our churches there we have every Sunday a little paper bag which is numbered and dated. We contract that we shall put in, say, half-a-crown every Sunday. That is a definite obligation. When it comes to Easter, in addition to putting the half-crown into the little bag for that Sunday, we make a voluntary offering for the clergy. Is there not an immense difference between the contractual obligation to pay every Sunday and the purely voluntary gift which we make to the clergy on Easter Day?
    The point which moves me in this matter more than any other is that we
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    have heard over and over again of the immense rise that has taken place in the wages of certain members of the working classes, for instance of those engaged in munition factories and those employed in aerodromes. In fact cases have actually come before the court of people who have been brought up for being drunk and disorderly. I remember a magistrate saying to a man who was little more than a boy and was earning £7 a week, "You must be working in a gold mine." The clergy are not working in any gold mines. They have not had their stipends raised on account of the increase, roughly amounting to 90 per cent., of the cost of living.
    In the North of Ireland we have in our Church a rule that unless the congregation can guarantee £400 a year, the clergyman shall cease when a change in the incumbency takes place to have the title of rector. It is with very great distress that I have seen a number of clergymen who formerly would have been rectors reduced when the living became vacant to the status of curates in charge. That is not due to Any lack of generosity ,on the part of the people. It is due to the fact that there has been a very large migration from the country into the towns. The clergy who bear an enormous increase in the cost of living and an enormous augmentation in Income Tax have not, so far as my experience goes, had their ordinary stipends raised. I think the Chancellor should bear in mind that a clergyman has to meet a great deal of expenditure on obligations which do not fall upon the ordinary individual. A clergyman with whom I was intimately acquainted—he was my own father—was expected in accordance with the custom of the parish to provide out of his own pocket the entire cost of the Sunday school treat. Would the Chancellor of the Exchequer have allowed him to deduct that considerable sum for Income Tax purposes? It was, further, the custom that at Christmas time the clergyman should give a piece of beef to all the old people. Would he have been allowed to deduct that for Income Tax purposes? The clergy are in a very peculiar position in this respect in having to meet a great many charges which the ordinary layman does not have to meet.
    When pressure is brought to bear by a large part of the electorate, the Chancellor of the Exchequer makes such enormous concessions as he did last year when

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    influence was brought to bear upon him to exempt from Income Tax a large part of the sum earned by married women. He did that at a cost to the Exchequer of £25,000,000. According to my hon. Friend on my right the concession we are asking for will cost a bare £150,000, but the clergy are a very small part of the electorate and cannot threaten to change the course of a by-election which would disturb the mind of the Government., But are they any the less worthy of consideration on that account? Should not the Chancellor of the Exchequer, a fair-minded and just man, take into consideration this very deserving class? I should be very sorry as a representative of one of loyal Ulster's constituencies to have to vote against the Government, but I feel so strongly on this matter that I hope my hon. Friend the Member for Keighley (Mr. Ivor Thomas) will carry his new Clause to a division, when I shall certainly give him my support in the Division Lobby.
    Sir Stanley Reed: I hope that my hon. Friends will carry this Clause to a Division, when I shall unhesitatingly go into the Lobby with them. I shall do that with no disrespect to my right hon. Friend the Chancellor of the Exchequer, but really with a lingering sense that I am doing him a justice and a kindness. I join with those who say that as Chancellor of the Exchequer he has no option but to take the view which he has taken on this matter, and if I criticise the rather strained arguments which were used in support of that attitude, I feel convinced in my own mind that he did not like the task which was thrust upon him in his capacity as Chancellor. Therefore, if there is any chance of this Clause being carried I think no one will be more pleased than the Chancellor himself. But I support the Clause particularly for a reason which was given, but which has not been developed in the Debate, by the hon. Member for Ealing (Sir F. Sanderson). There are a dozen ways of getting out of paying or thrusting upon the incumbent the paying of this tax. It is not the large contributions which pay the tax. Anybody who can afford to give a note to the vicar at Easter time so that the vicar has to pay tax on it is either ignorant or foolish. It can be done and is being done, and I hope always will be done. As the hon. Member for Ealing said, this tax is really a tax on the sixpences and shillings, and not on the five-pound notes,
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    and I think it is wholly wrong that we should be forced into practices which are perfectly legitimate but which are slightly irregular in order to get behind a gross injustice. Therefore, I shall do my very best to render the greatest service I can to the Chancellor by voting for this Clause, and an equal service, I hope, to the Financial Secretary, because I feel it will be the sorriest hour of his life when he gets up to attempt to justify the unjustifiable and to inflict a burden which he knows in his heart should not be inflicted and which he would like himself to see swept away.
    Mr. Ralph Etherton: Much has been said by many hon. Members about those for whom all of us must have very much sympathy. I think it was the hon. and learned Member for North Croydon (Mr. Willink) who said that we all know the law and if the law needs to be changed it was for Parliament to do it. That is, of course, a truism, but I hope Parliament will not decide to change the law unless there is a logical and proper case for a change, and I venture to think that if this matter is examined dispassionately, however much our sympathies may be with the clergy, we cannot but come to the conclusion that the law as it stands is proper and just. After all, the Easter offering is a normal emolument which comes to the clergy in the ordinary way of their business as clergy, and I cannot see the logic of providing a special exemption for this particular part of their emolument. If we are to exempt this part of their income we are creating a new anomaly. It has been said that the clergy are badly paid, and that is well known, but it has also been said that they pay 10s. in the £ tax on these Easter offerings, but in most cases that is quite untrue. The Easter offering is part of their ordinary income, and as such is subject to the ordinary deductions which normal income attracts, and so far from paying 10s. in the £ on Easter offerings they pay considerably less than that unless their income if married and with two children exceeds approximately £450 a year.
    Let us examine the matter in a logical way from the start. In the first place they get a deduction of 10 per cent., as does everybody else for earned income. Then a married man gets the deduction of the first £140, and a further £165 is taxed only at 6s. 6d. in the £ If he has two

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    children he would get a further allowance of £100. Thus, until his income reaches approximately £240 it would not be attracting tax at all, so that it is quite idle, if I may say so with great deference to hon. Members, to try to excite sympathy on the ground that this Easter offering attracts Income Tax at 10s. in the £ In the case of a married man with two children it will not do that until his income exceeds £450. Bearing all those considerations in mind, while we may have great sympathy for the clergy we should treat this matter in a logical way and not exempt from tax a particular portion of a clergyman's emoluments when everyone else in the country is taxed in the ordinary way on the whole of his income.
    Major Gates: I should have to oppose this Clause, for the following reason, that although I have been in complete sympathy with the speeches in support of it so far, I doubt very much whether the Clause carries out the desires of those who are supporting it. The Chancellor is maintaining, and the hon. Member for Stretford (Mr. Etherton) is maintaining, that the Easter offering is a normal emolument. I deny that, because it has never been a normal emolument with me. I never subscribed to the little bag to which reference has been made. The clergy are my friends, and I go to them quite frankly—Easter is generally the time to do it—and say, "I want to give you my sincere casual gift in token of the magnificent work you have done during the last year. I am not going to put anything into the bag, because I have no desire to make a casual gift to the Chancellor of the Exchequer." I am quite sure that if congregations knew they were making a casual gift to the Chancellor of the Exchequer, they would not do it, and it is one of the dangers of this Debate that now that the matter has received publicity they may not contribute as they Dave done. If the Clause is pressed to a Division and if it were a question of "Do you sympathise with the clergy or not?" naturally I should vote with the "Ayes," and I am sure that if I make a casual spontaneous gift to somebody that is not liable to taxation, but I would ask the hon. Member for Keighley (Mr. I. Thomas) whether the reference in the Clause to a maximum of £50 means that I can never give anybody more than £50.
    Mr. Thomas: In that case only the first i5o would be exempt from tax. On the more substantial point, if there are any legal flaws in the Clause there need be no difficulty about that, provided the Chancellor is prepared to accept it, because between now and the Report stage he could no doubt get a form of words which would be suitable to his advisers.
    Major Gates: That is my point I want to support the principle that we may continue making our free gift to our good friends the clergy without the Chancellor of the Exchequer putting his hand in the plate, because that is repugnant to us, and I think the whole Committee are agreed that it must stop. I hope that the hon. Member will not press this matter to a Division, because I do not think I could support his Clause in its present form with the maximum figure of £50;. We have heard that Nonconformist clergymen are paid almost entirely by gifts, and their taxable income would start at £50 if the Clause were carried. If we are to challenge the Chancellor to a Division, I would like to have a slightly differently worded Clause before I could follow the hon. Member into the Lobby.
    Lieut.-Commander Joynson-Hicks: I feel I ought to apologise. to the Committee for intervening in this Debate, as my duties elsewhere have prevented me from being present during the whole Debate, but I feel very strongly on this point. I am anxious, if possible, to support the proposed new Clause and to encourage the Mover to press for a Division upon it, if necessary. I think we all agree with what was intended by my hon. and gallant Friend who has just sat down, but I cannot agree with the conclusions which follow from his argument. If we are to achieve any relaxation of the present law on this subject, the only way we can do it is by pressing for a Division when opportunity is offered. I gather that the appeals which have been addressed to the Chancellor of the Exchequer have not shown evidence so far of being successful. I am certain that he would be the first on personal grounds to wish to alleviate the hardships which this additional tax causes to the most poorly paid professional class in this country; but, on the other hand, it has already been pointed out that the relaxation for which we are asking would result in only

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    a very insignificant diminution of the national income.
    Upon that ground I feel that the proposal should appeal to the right hon. Gentleman to a very great extent. By sacrificing such a very small diminution of the national income he would please and give hope and confidence to a very wide circle of people, very much wider than the circle of people who would actually benefit. There is not the least doubt that, since it became known that Easter offerings were subject to tax, it is a matter which rankles in the hearts and consciences of a great number of people who feel that it is fundamentally wrong that voluntary offerings made in church should be subject to taxation. It may be right or wrong, but I submit that that fact is there. I understand that the right hon. Gentleman has said that that is the law, but it is worth pointing out that it was not realised until comparatively recently that that was the law. The effect of the law is of quite recent origin.
    I would point out another aspect of the matter which might commend itself to the Chancellor. Most relaxations of the law are really the thin ends of wedges. They open wide the doors to appeal for further relaxations in favour of other parties. I do not think that argument can be used in this case. The present proposal is not the thin end of a wedge at all, because if this relaxation were granted there is no other professional class who could argue that they also ought to have the benefit of it. It is the law, but it is inadvertently the law, and it has been found by many people to be repugnant to the national conscience at the present time. Therefore I submit that it is up to us to take cognisance of that fact and press for the law to be amended or annulled in the only place in which that step can be taken. This is the time and the opportunity to do so.
    My final word is with regard to the utterance which has recently been addressed to the Committee stating that it is not the standard rate of tax which is necessarily suffered by incumbents and other clergy in this matter. In so far as it is correct—and it is mostly correct—it is a strong argument in favour of the relaxation. It means that all those people are already so poorly paid that they do not receive what the Chancellor considers upon financial grounds to be a standard rate of income. If the law could be
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    amended it would bring great relief to a great number of people. The only argument I can see against the proposition is that the whole method of increasing the income of the clergy by Easter offerings is wrong, but that is not a view to take on the present occasion. Easter offerings are an ancient and honourable custom, and a Christian custom, which this Committee would do well to recognise. I hope that the Committee will take cognisance of it and recognise it, if necessary by pressing this Clause to a Division.
    Mr. Benson: I do not think that my hon. Friend the Member for Keighley (Mr. Ivor Thomas) has helped the Church by raising this matter or that the way in which hon. Members have conducted the Debate in favour of the Clause has added to the dignity of the Church. The Committee has agreed—or at least there was a murmur of assent—when it was stated that the legal interpretation of the position on Easter offerings was correct, and that they were income, [An HON. MEMBER: "No."] Certainly. It has already been settled by the highest tribunal in the land. The point to be established before the proposed new Clause should be accepted would be, Why should a regular annual sum of money, which is admitted and decided as income, be free of tax merely because it is contributed in a certain way? The hon. Member who last spoke suggested that it rankled in the consciences of churchgoers that the small incomes of the clergy should be taxed 10s. in the £ The best method of dealing with that problem is to raise the salaries of the clergy rather than trying to get a tax concession. For what reason should a clergyman of the Church of England get a tax concession just became his salary is low?
    Mr. Boothby: The hon. Member seems to accept it as axiomatic that this Committee has to accept the decision of the House of Lords upon what is income. Our case is largely based upon our view that Easter offerings are not income.
    Mr. Benson: There is no appeal from a decision of the House of Lords. We have to accept it. [HON. MEMBERS: "No."] This House can pass a law to exempt Easter offerings, but until it has done so they remain income. Nobody, in reality, has disputed that they are income.
    Mr. Ivor Thomas: I dispute it. If Easter offerings were given to the incumbent in the form of War Savings Certificates they would be capital, and would escape taxation.
    Mr. Benson: I am afraid that my hon. Friend is entirely wrong in his law. If incumbents were paid with War Savings Certificates, payments in kind or any other way which had a cash value, those payments would be income.
    Mr. Thomas: No.
    The Attorney-General (Sir Donald Somervell): Apart from the question which is raised by a later Clause about board and lodging, money's worth is treated at its worth as income, just as much as money. You could not avoid the payment of Income Tax merely because you got your employer to pay you in War Savings Certificates.
    Lieut.-Colonel Acland-Troyte: Does that mean that if I give my parson a dozen eggs for breakfast he has to pay Income Tax on them?
    Lieut.-Commander Joynson-Hicks: We are here dealing with Easter offerings and not with household sustentation.
    Mr. Benson: It does not matter what you put into the Easter offering. If it is possible to turn it into cash, it is income. As a matter. of fact, hon. Members have been pointing out that Easter 'offerings' have been a source of income, not since 1909 only, but for hundreds of years. It is no use quibbling. If Easter offerings are not income, why have hon. Members not the courage of their convictions? Why do they not propose to exempt the whole of the Easter offerings from taxation? Why put in the limit of £50?
    Captain Strickland: Suppose a parson made himself very unpopular on the Sunday before the Easter offerings, and no, Easter offerings were put in; could he sue on that? If he could not sue, it is not income.
    Mr. Benson: A barber cannot sue on his tips, but they are income and are taxable.
    The Áttorney-Genera: A barrister can- not sue for his fees.
    Mr. Benson: I thank the right hon. and learned Gentleman very much for giving me that information.
    Mr. Thomas: The real analogy is with the fees that the clergyman receives for churchings, marriages and funerals. The Easter offerings are in a quite different category. We put in the limit of £50 to prevent abuses.
    Mr. Benson: If Easter offerings are not income, it is no abuse to exempt the whole amount. As a matter of fact, the £50 limit shows a bad conscience on the part of the hon. Member for Keighley arid other hon. Members who are trying by tax concessions to subsidise parsons wages because those wages are low. [HON. MEMBERS: "No."] Certainly.
    Anyhow, it is obvious that we cannot reach agreement on this point. I think some of the suggestions made have been most undignified. Hon. Members have said, "Well, we can get round it this way. We can add parsons of the Church of England to the body of tax dodgers who use questionable means of avoiding taxation." [HON. MEMBERS: "No."] Most certainly. Member after Member has got up and said that. The hon. Member for Aylesbury (Sir S. Reed) said, if I remember. rightly, that his £5 was not taxed and was not going to be taxed. Other members have suggested one way and another way, and there has been right through that undercurrent of suggestion that if the Chancellor does not give way, other methods will be adopted to. make up the parson's salary without making it liable to tax.
    Mr. Butcher: Is it not a fact that there is a legal decision that a man has a right so to arrange his income as to attract the smallest amount of tax?
    Mr. Benson: That is perfectly true, and that is a dictum which has been condemned and held up to contempt in this House every time it has been quoted. I am astonished that it should be quoted by someone, apparently a member of the Church of England, who is supporting this Clause. That is the very attitude I am complaining about, that you are attempting to increase the salaries of clergymen in the Church of England and using as an argument all the arguments that the tax dodgers use, and even threatening tax dodging.
    Mr. Butcher: Why should it generate so much heat when I quoted one judgment?
    The Deputy-Chairman (Mr. Charles Williams): We have had a very long

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    Debate on this Clause. There is a good deal of Business to do, and I think that if one Member at a time made his speech and finished, it might be batter.
    Mr. Benson: I have not much more to say. The hon. Member asked me why so much heat is generated. Is he not aware that it is traditional in this House that anything which attaches to clerical and religious matters invariably generates heat. We have passed sums of thousands of millions in Votes of Credit with three, four or five Members sitting here. Here is a little trifling question yet we have at least 50 Members here. Of course heat is generated. I am protesting vigorously against this atmosphere, against this attitude of tax dodging. Although I am not a member of the Church of England, I object to this undignified kind of argument, which is an attempt to blackmail the Chancellor, coming from members of a religious body which ought to support a more principled attitude towards the Exchequer and taxation.
    Sir William Davison: The acceptance or rejection of this Clause depends upon whether or not Easter offerings are income, that is, are a regular source of income to the clergymen. Earlier in the Debate the hon. Member for St. Albans (Sir F. Fremantle), who was sitting below me, asserted that under the Church Assembly Act power was given to the Church authorities that in the case of clergy whose income was considered adequate it would be in the power of the Church authorities to ask them to pay over part of their Easter offerings. If that is so, I would be glad if whoever is going to reply would say whether there is some such provision in the Act referred to, for if there is a provision of that kind in that Act it is surely conclusive that Easter offerings must be considered as forming part of the clergyman's income. Therefore, it seems to me if that is so that the argument of the Chancellor is a very strong one, and is supported by the Church authorities themselves.
    The other matter to which I would like a reply is that the Chancellor in his speech said that the law as regards gifts to the clergy, was quite clear and established, and that if we exempted income up to £ 50 in the case of Easter offerings from taxation, it would be necessary to exempt gifts given to clergy or ministers at Whitsuntide or Christmas, as is the case in
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    certain other denominations. Do I understand from that that all gifts to a clergy. man are to be considered as liable to Income Talc? Supposing a clergyman gives a very good set of Whitsuntide addresses and two or three of his parishioners say, "That was a splendid set of addresses which the rector gave. He is not very well paid. We should like to give him a little present," and they collect £15 or£20 and hand it over to him as a present. Is that subject to Income Tax or is it not?
    Mr. E. P. Smith: I put a very similar question to the Chancellor earlier in the discussion, and asked him whether gifts given individually to a priest or minister on his birthday by members of his congregation would be liable to Income Tax. He answered me in the affirmative.
    Sir K. Wood: We must not be under any misapprehension. I would like before I gave an authoritative reply to look at the facts in each case.
    Whereupon The GENTLEMAN USHER of the BLACK ROD being come with a Message, The CHAIRMAN left the Chair,
    Mr. SPEAKER resumed the Chair.

  ROYAL ASSENT
  Message to attend the Lords Commissioners.
  The House went; and having returned—
  Mr. SPEAKER reported the Royal Assent to:

  1. Consolidated Fund (No. 3) Act, 1943

  2. War Damage Act, 1943.

  3. Housing (Agricultural Population) (Scotland) Act, 1943.

  4. Sunderland Corporation Act, 1943.

FINANCE BILL
Again considered in Committee.
[Mr. CHARLES WILLIAMS in the Chair]

FINANCE BILL

  NEW CLAUSE.—(Easter Offerings.)
  Question again proposed, "That the Clause be read a Second time."
  Sir K. Wood: I would just like to complete what I was saying. I think that the test in all these cases must be whether

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  the money is really paid in respect of or by virtue of the office which the person holds, or whether it is in fact given to him personally, and apart from that office altogether,
  Sir W. Davison: I would like the two points that I raised before the interval to be definitely settled. I do not think the Chancellor quite answered them. My first point was in support of the Chancellor's contention that if Easter offerings are treated by the church authorities themselves as part of the clergyman's income, it seems to me that there is no question that they are liable to taxation. The other was, is there to be a special bar put on the clergy receiving all gifts, apart from Easter offerings? The Chancellor said that he could not exempt Easter offerings and continue taxation on offerings at Christmas or Whitsun. But, as I said just now, suppose a clergyman gives a very able series of addresses in church or lectures in his school house, and a number of his parishioners feel that they would like to make a present to enable him to go to the seaside for a week or for some other purpose. Is that present taxable, because the money is given him in respect of something done in the course of his employment? The Chancellor says that the matter is a plain and well-established one, but I think it bristles with difficulties. It seems to me that clergymen are placed in a worse position than other people. Other officials can have casual gifts made to them without being liable to Income Tax in respect of such gifts. Surely it should be possible to make presents to clergymen not annually, but for good work in their parishes, without those presents being liable to taxation?
  Mr. Denman: Perhaps I might be allowed in a few sentences to express my great regret to the hon. Member for Keighley (Mr. I. Thomas) that I cannot support this Clause. I suppose I have spent more time than most Members of this House in furthering the material prosperity of the clergy, and I would gladly support anything I could with that object. The reason why I cannot support this Clause is quite simple. The Church would not welcome what would be regarded as special privileges which are not granted to other people. I see much harm to Church work arising from the allegation, however unfounded
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  it may be, that the Church enjoys economic privileges. It would be a profound mistake, by this Clause, to add fresh fuel to that particular fire.
  The Financial Secretary' to the Treasury (Mr. Assheton): Several hon. Members have referred to the fact that I am myself a member of the Church Assembly. I should like to tell the Committee what my position is. I am a member of the Church Assembly, and was for many years a member of the Central Board of Finance of the Church; so I have a certain amount of experience in matters of this kind. When this Clause first appeared on the Paper I examined the matter very carefully indeed. I am aware that several hon. Members have stated the position very clearly so far as the law is concerned. My hon. and learned Friend the Member for North Croydon (Mr. Willink) made some point of this: "We all know what the law is; what some of us want to do is to get it altered." It is admitted that this is the law, but the question I want to address myself to is, whether it is just. I think it is just.
  Mr. Willink: In one of the most recent cases the Judge said that he very much disliked to have to decide the case in a way which the decision of the House of Lords forced him to do. I have the case here. It was in 1931.
  Mr. Assheton: The Committee will appreciate that I have not had an opportunity of studying the particular reference which my hon. and learned Friend made, but I address myself to the question of whether this law is just. Every member of a congregation who contributes to the Easter offering knows that it is to supplement the income of the clergyman. The next point is this. There is very little doubt that on such an occasion the clergyman is receiving the gift by virtue of his office. He would not be receiving that gift if he were not the clergyman of that parish. My hon. Friend the Member for East Aberdeen (Mr. Boothby) said that the Board of Inland Revenue is putting its hand into the plate and taking out what belongs to somebody else. My hon. Friend went on to suggest that if Income Tax was only 6d. in the £ it would not matter. I do not see the logic of that. If it is wrong to take 10s. in the £ it is wrong to take 6d. [AN HON. MEMBER: "He said that it

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  would matter less."] He said that it would matter less. The Clause suggests that the maximum should be £50 a year, in which case, I suppose, my hon. Friend would suggest that it is all right to put your hand into the plate after £50 had been taken out, but not before. There, I think, my hon. Friend's argument breaks down.
  There is no point in the argument as to whether this is or is not a contractual payment. My hon. Friend the Member for Walsall (Sir G. Schuster) made some play with the point, but that has nothing to do with Income Tax. When deciding whether something of this kind is income or not, it does not matter whether it is contractual or not. The barrister who draws his fees receives something which is not contractual. The waiter or hall porter who receives tips is assessed on those tips, and I find it difficult to distinguish between his case and the case of the clergyman who receives a gift from his parishioners. Then there are the other churches. In the Church of Rome there are many occasions when members of the congregation make a voluntary payment to a priest for a Mass. That voluntary payment is a taxable payment, and in fact such payments form the greater part of the remuneration of many priests. I think it would be quite unjust to relieve the Easter offerings of the Church of England—of which I am happy to be a member—and not to relieve offerings made in very similar circumstances.
  Mr. Driberg: Surely those are. fees or offerings for quite specific services? They are not a general tribute to the personality of the man.
  Mr. Assheton: They are paid to the priest, just as an Easter offering is paid to the clergyman by virtue of his office.
  Mr. Driberg: But surely they are in the same category as funeral or marriage fees.
  Mr. Assheton: But he receives them by virtue of his office.
  I would like to deal with the point of poverty. It has been said by many Members, and it is well known, that the clergy are poor. I would say, in the first place, that it is a great discredit to many of the congregations that those clergy are poor. In the second place, I
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  suggest that clergymen of the Church of England do not want to be exempt from taxation which falls upon them if similar taxation falls upon people with similar burdens. The whole essence of our taxation is that it is so carefully adjusted that it falls upon people according to what they can afford to pay. Look at the anomalies which would result from this Clause. Suppose you have two clergymen in adjoining parishes, each with an income of £400 a year. One has £400 from investments which belong to the living, and the other has £50 from Easter offerings and £350 from investments. Each clergyman has a wife and two children, so that both are in the same position to bear whatever taxation has to be borne. Why should the clergyman who derives £50 of his income from Easter offerings be treated in any way differently from the person who derives the whole amount from investment? The proper way to meet the matter is the way in which the Church authorities are trying to meet it now. We have heard from my hon. Friend the Member for Central Leeds (Mr. Denman) the views of an Ecclesiastical Commissioner, and I am certain that the views he expressed represent the general views of the Church. The Church would not seek to have some advantage at the expense of the rest of the community. They would take such steps as are open to them.
  Earl Winterton: Does the Financial Secretary suggest that my hon. Friend the Member for Central Leeds (Mr. Denman) was speaking on behalf of the Ecclesiastical Commissioners?
  Mr. Assheton: I said that he spoke as an Ecclesiastical Commissioner.
  Mr. Denman: An ex-Ecclesiastical Commissioner.
  Earl Winterton: It is important that we should know whether he was representing the views of the Ecclesiastical Commissioners.
  Mr. Assheton: I did not suggest that he had expressed the views of the Ecclesiastical Commissioners. I do not know them, but I should not be at all surprised to hear that he did.
  Mr. Denman: I used to be an Ecclesiastical Commissioner until about a month

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  ago, but anyhow I have no authority to speak on their behalf. I was only speaking as one who had had a particularly long experience of these matters.
  Mr. Assheton: I do not want to put anything into the mouths of the Ecclesiastical Commissioners, but it is clear that my hon. Friend has had great experience of these matters, just as I myself have had experience of problems of Church finance. I was saying that the proper remedy was for the Church to see that the clergymen were properly paid, and I am happy to say that the Church is at the present time taking steps in that direction, and I believe that very soon the situation will be better than it is to-day. So far as this particular Clause is concerned, I am satisfied of two things—that, if it were accepted it would not be just, and I am also satisfied that, from the point of view of the Church, it would not be wise. My hon. Friend made that point very well and I ask the Committee therefore to agree with the Chancellor of the Exchequer, who said that not only was this the law, but it was also common sense.
  Mr. A. Edwards: I am not a member of the Church of England, but I have many friends among the clergy, and I do not think that they will be very pleased about the arguments which have been put up on their behalf to-day. It is said the labourer should be worthy of his hire, and the hon. Member for Central Leeds (Mr. Denman) said that he has spent a good deal of his life acting in the interests and prosperity of the clergy, and it must have borne upon him to-day that he has had a wasted life.
  Mr. Denman: I only said that I had spent more time than most Members.
  Mr. Edwards: Had the hon. Member been more successful and the clergy had a decent living, this question would not have arisen.1s it not suggested that, if they had been provided with decent salaries, they would not have had to do this cadging? [An HON. MEMBER: "It is not cadging."] Is it dignified that a man, once regularly in every year in order that he may approach something like decency, should have to cadge from the congregation?
  Mr. Goldie: If the hon. Member will look at the Rubric of the Communion Service he will find that it is the duty of every parishioner at Easter to settle his bills with the vicar.
  Mr. Edwards: It also says in the Scriptures that everything shall be done decently and in order. Then let everything in regard to salaries be done decently and in order. Let the people who worship provide the funds. Many friends of mine feel that they have to cadge anyhow, no matter what the interpretation of my hon. Friend is. I listened to the arguments of hon. Friends, and I was impressed, and I was still more impressed when I heard the Chancellor's reply, and I cannot always say that. He certainly tore the arguments to pieces here. I have watched the activities of the hon. Gentleman the Member for South Croydon (Sir H. Williams), who is supporting this proposal, for some time. His ideas are always flowing in one direction, towards what is known as the Poor Law. A good many of the clergy and certainly those whom I know will be sorry of some of the arguments which have been put up here to perpetuate their poverty by gifts which are given to them out of pity for their poverty.
  Commander Sir Archibald Southby: I apologise to the Committee for speaking in the Debate, not having heard all the arguments, but circumstances beyond my control made it impossible for me to be here before now. I confess that although it may be legal, that this taxation should take place, it seems to me that what we are discussing now is the question of justice towards the vicar. It cannot be common sense, if I send a cheque to the vicar's Easter offering, that it should be taxed, whereas if I meet him in the Street and slip £5 into his hand and say, "This is my Easter offering, but call it a donation for your holiday fund," that then it should not be taxed. It is no argument at all to suggest that the stipends of vicars ought to be greater than they are. Everybody knows that they ought to be greater than they are. I agree with the hon. Member who remarked that the efforts of the hon. Member for Central Leeds (Mr. Denman) to further the prosperity of the clergy have not been successful. That is why we are now trying to do something to help the clergy. This Easter offering is

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  not part of the stipend. I look upon my donation, speaking personally as a member of the Church of England, as a gift that I ought to give at a certain time of the year, but I do not feel bound to give the same amount each year, nor, indeed, to give it every year.
  Mr. A. Edwards: The vicar would be hard up if you did not.
  Sir A. Southby: It is wrong to say that it is only given where the stipend is low. The Easter offering is given whatever the income of the vicar may be. It is also wrong to suggest that circumstances are the same with regard to members of the Roman Catholic Church. It is not so at all. In that case the sums are fees.
  Mr. Assheton: They are voluntary offerings.
  Sir A. Southby: They are voluntary offerings for services rendered. As I see it, the incomes are not comparable in the case which the Minister put forward when he said, that if there were two vicars in adjoining parishes, one having £400 a year and the other £350 a year, plus £50 Easter offering, it was right that both should be taxed. I do not think the cases are comparable at all. In the latter the vicar could not know with any certainty in any year that he would have that £50. Although the legal position may be what has been stated in the Committee, in common justice to men who are very hard working, these voluntary donations should be free of tax. It is true that the £50 limit is unreasonable. I would sooner have said that the whole of the vicar's Easter offering should be tax free, but it is a case of
  "These ought ye to have done, and not to leave the other undone."
  I agree with other hon. Gentleman, however, that £50 would be a beginning. If this question goes to a Division, I shall vote for the Clause.
  Major Sir Edward Cadogan: I have listened to nearly the whole of the Debate and to the judgment by some learned Judge which was read out by the Chancellor of the Exchequer. I gather from that that the gift is taxable in virtue of the recipient's office, if it is "normal and continuous." Those are the definite words. How on earth a gift can be "normal and continuous" which is
  430
  entirely art the option of the parishioners is something of which I would like to have an explanation.
  Mr. Goldie: Unfortunately, I was not present to hear the speech of my hon. and learned Friend the Member for North Croydon (Mr. Willink), but I want to join issue with the Financial Secretary in his discussion of the question: Is the law just? From my experience I am convinced that the law as it exists at present is not just. Expressions of opinion have been made from all sides of the Committee that this injustice ought to be put right, and I ask the Chancellor whether, between now and next stage of the Bill, he will reconsider the matter. My objection to the present state of affairs is this: The Blakeston case in the House of Lords laid down a hard and fast rule which, of necessity, has been applied by courts of law in matters which have no concern with Easter offerings and which have inflicted untold hardships on recipients who have received gifts from those who are fond of them. I must be careful not to depart from the question of Easter offerings, but as an instance let me give an example from my own experience. A former Member of this House, practising at the Bar, left to join the Armed Forces of the Crown. Being a generous man and having in his employment a clerk nearly 80 years of age who had been with him for many years, he gave him a very substantial cheque simply as a mark of appreciation of their years of service together. What happened? Fifty per cent. of that cheque was taken by the Revenue authorities on the basis of the Blakeston case.
  The Financial Secretary talked about a contract having nothing to do with it, but the first thing you look into is to see whether there is a contract. That is the distinction between the Seymour case, in which there was a benefit, and the cases of professional footballers for whom I have appeared. We have got down to the absolute narrow border line with the Income Tax authorities who stand on the Blakeston case. In the interests of our clergy dare I ask the Chancellor to show leniency." Very soon, offerings will be given at our churches at Whitsun for our curates, whose wages in most cases are extremely small. The principle underlying this law is wrong from the word "Go," and I say that we would be failing in our duty if we did not make an appeal

  431
  to the Chancellor to give further consideration to this matter.
  Mr. Gallacher: I am interested in this discussion, because it seems to me that the clergymen of this country seem to have very many enemies in this House. There is a Scripture that is worth quoting at this moment:
  "Woe unto you, when all men shall speak well of you."
  I am very much concerned about the spiritual standing of the clergy, particularly after hearing the speech of the hon. Member for South Kensington (Sir W. Davison), who suggested that when you heard a clergyman make a really good sermon you felt like putting your hand into your pocket and saying, "There you are, my lad." What would the hon. Member consider to be a good sermon? Think of the temptation which will be put in the way of the clergy. I am not concerned about a sermon for soothing the troubled breast of the hon. Member for South Kensington but about those who go into the slum areas of this country and spend their lives helping mothers, the sick and helpless. Nobody ever thinks of making offerings to them, particularly if they go into the pulpit or on to a public platform and say what they think about the rotten system that produces their conditions.
  The Deputy-Chairman: I think the hon. Member is getting rather wide of the point at issue.
  Mr. Gallacher: Do not be concerned about offerings to the clergy. Do not give them any; they will be all the better for getting no offerings; they will be all the better for doing a little bit of "scrounging" or fighting to get better conditions. Remember the Beatitudes.
  "Blessed are the poor."
  Nothing is ever said about blessing those who will receive the offerings of wealthy patrons. Then there is the other:
  "Blessed are ye when men shall revile you … for My sake."
  If Members on the other side would start abusing and reviling our clergy we should feel that the clergy were doing something worth while.
  Mr. Willink: There seemed a little doubt on the Front Bench when I interrupted the Financial Secretary, and I
  432
  would like to make my point clear. The authorities as I know them do not indicate that there is opposition in high legal quarters to a change in the law. The opposition comes from the Treasury, not from the Judges. May I make a short quotation from a judgment given by Mr. Justice Rowlatt in deciding a case about Whitsuntide offerings? In the case of the Rev. Starkie, in 1931, in the King's Bench Division, he said:
  "In my judgment it is quite clear that iu this case the Crown are entitled to succeed. Although it is very unpleasant to have to decide against the respondent, one has to apply the law to the best of one's ability."
  There is an indication that in the view of the learned Judge the law needed to be changed. The learned Judge finished his judgment in these words:
  "In these circumstances, although I very much dislike deciding these cases against people like Mr. Starkie, I have 'no alternative but to say that I think the Crown are right and that this appeal must be allowed."
  I regretted very much to hear the hon. Member for Chesterfield (Mr. Benson) saying it was more a question of, "Was this income? "There are all sorts of income which are not taxable. The question before the Committee is whether the whole of this money should be taxable.
  Mr. Benson: The hon. and learned Member suggests that the law is unjust and should be altered. May I point out that the effect of the Clause which we are discussing now is not to alter the law? Whitsuntide offerings will be untouched. It merely says we are to make an exception in one portion of the law, and that is the first £50 of Easter offerings. If the law is indefensible, there is only one thing for the House to do and that is to alter it, and not make a tiny exception.
  Mr. Willink:I have never known any Amendment to any Bill which made all necessary amendments to the law.
  Mr. Ivor Thomas: It is with great reluctance that I do so, but there is no question of confidence in the Government involved, and, in view of the inability of the Chancellor to give any reconsideration between now and Report, I must force this to a Division.
  Question put, "That the Clause be read a Second time."
  The Committee divided: Ayes, 65; Noes, 111.

  Division No. 21.

  AYES.

  Acland-Troyte, Lt.-Col. G. J.

  Hill, Prof. A. V.

  Savory, Professor D. L.

  Adams, D. (Consett)

  Hinchingbrooke, Viscount

  Schuster, Sir G. E.

  Boles, Lt.-Col. D. C.

  Hogg, Hon. Q. McG.

  Shakespeare, Sir G. H.

  Braithwaite, Major A. N. (Buckrose)

  Jennings, R.

  Smith, E. P. (Ashford)

  Brooke, H. (Lewisham)

  Joynson-Hicks, Lt.-Comdr. Hn. L. W.

  Smithers, Sir W.

  Butcher, Lieut. H. W.

  Keir, Mrs. Cazalet

  Southby, Comdr. Sir A. R. J.

  Cadogan, Major Sir E.

  King-Hall, Commander W. S. R.

  Stuart, Lord C. Crichton- (Northwich)

  Cluse, W. S.

  Lamb, Sir J. Q.

  Taylor, Major C. S. (Eastbourne)

  Cobb, Captain E. C.

  Lambert, Rt. Hon. G.

  Thomas, Dr. W. S. Russell (S'th'm'tn)

  Cook, Lt.-Col. Sir T. R. A. M.(N'flk, N.)

  Linstead, H. N.

  Touche, G. C.

  Crowder, Capt. J. F. E.

  Little, Dr. J. (Down)

  Tree, A. R. L. F.

  De Chair, Capt. S. S.

  Lucas, Major Sir J. M.

  Tufnell, Lieut.-Comdr. R. L.

  Driberg, T. E. N.

  Mills, Colonel J. D. (New Forest)

  Wedderburn, H. J. S.

  Elliston, Captain G. S.

  Morgan, R. H. (Stourbridge)

  White, Sir Dymoke (Fareham)

  Emmott, C. E. G. C.

  Nunn, W.

  Williams, Sir H. G. (Croydon, S.)

  Fremantle, Sir F. E.

  Ponsonby, Col. C. E.

  Willink, H. U.

  Galbraith, Comdr. T. D.

  Rankin, Sir R.

  Windsor-Clive, Lt.-Col. G.

  Graham, Capt. A. C.

  Rathbone, Eleanor

  Winterton, Rt. Hon. Earl

  Gridley, Sir A. B.

  Reed, Sir H. S. (Aylesbury)

  York, Major C.

  Hall, W. G. (Colne Valley)

  Rickards, G. W.

  Hannah, I. C.

  Robertson, Rt. Hon. Sir M. A. (Mitcham)

  TELLERS FOR THE AYES.—

  Harvey, T. E.

  Royds, Admiral Sir P. M. R.

  Mr. Ivor Thomas and Mr.

  Higgs, W. F.

  Sanderson, Sir F. B.

  Boothby.

  NOES.

  Adamson, Jennie L. (Dartford)

  Foot, D. M.

  Pilkington, Captain R. A.

  Adamson, W. M. (Cannock)

  Gallacher, W.

  Power, Sir J. C.

  Albery, Sir Irving

  Gibson, Sir C. G.

  Pownall, Lt.-Col. Sir Assheton

  Assheton, R.

  Goldie, N. B.

  Ritson, J.

  Barnes, A. J.

  Green, W. H. (Deptford)

  Robertson, D. (Streatham)

  Beaumont, Maj. Hn. R. E. B. (P'hsm'h)

  Greenwood, Rt. Hon. A.

  Salt, E. W.

  Beit, Sir A. L.

  Grimston, R. V.

  Scott, Donald (Wansbeck)

  Bennett, Sir P. F. B. (Edgbaston)

  Guy, W. H.

  Silkin, L.

  Benson, G.

  Hardie, Agnes

  Smith, Bracewell (Dulwich)

  Bevan, A.

  Henderson, J. J. Craik (Leeds, N.E.)

  Somervell, Rt. Hon. Sir D. B.

  Blair, Sir R.

  Hughes, R. Moelwyn

  Spearman, A C. M.

  Boulton, W. W.

  Hulbert, Wing-Commander N. J.

  Stephen, C.

  Bower, Comdr. R. T. (Cleveland)

  James, Wing-Com. A. (Well'borough)

  Storey, S.

  Brocklebank, Sir C. E. R.

  Jowitt, Rt. Hon. Sir W. A.

  Strauss, G. R. (Lambeth, N.)

  Brooks, T. J. (Bothwell)

  Kimball, Major L.

  Stuart, Rt. Hon. J. (Moray & Nairn)

  Burton, Col. H. W.

  Kirby, B. V.

  Sueter, Rear-Admiral Sir M. F.

  Campbell, Sir E. T. (Bromley)

  Knox, Major-General Sir A. W. F.

  Sutcliffe, H.

  Cary, R. A.

  Leonard, W.

  Taylor, H. B. (Mansfield)

  Charleton, H. C.

  Leslie, J. R.

  Thomas, J. P. L. (Hereford)

  Chorlton, A. E. L.

  Lipson, D. L.

  Thorne, W.

  Clynes, Rt. Hon. J. R.

  Manningham-Buller, R. E.

  Thorneycroft, Maj. G. E. P. (Stafford)

  Colegate, W. A.

  McEntee, V. la T.

  Viant, S. P.

  Cooke, J. D. (Hammersmith, S.)

  McEwen, Capt. J. H. F.

  Walkden, A. G. (Bristol, S.)

  Cove, W. G.

  Mack, J. D.

  Walker, J.

  Craven-Ellis, W.

  McKie, J. H.

  Ward, Col. Sir A. L. (Hull)

  Critchley, A.

  McNeil, H.

  Wardlaw-Milne, Sir J. S.

  Davies, Major Sir G. F. (Yeovil)

  Makins, Brig.-Gen. Sir E.

  Watkins, F. C.

  Denman, Hen. R. D.

  Mellor, Sir J. S. P.

  Webbe, Sir W. Harold

  Douglas, F. C. R.

  Mills, Sir F. (Leyton, E.)

  Westwood, J.

  Drewe, C.

  Molson, A. H. E.

  White, H. (Derby, N.E.)

  Dugdale, Major T. L. (Richmond)

  Montague, F.

  Whiteley, Rt. Hon. W. (Blaydon)

  Dunn, E.

  Murray, J. D. (Spennymoor)

  Williams, Rt. Hon. T. (Don Valley)

  Edmondson, Major Sir J.

  Nicholson, Capt. C. (Farnham)

  Womersley, Rt. Hon. Sir W.

  Edwards, A. (Middlesbrough, E.)

  O'Neill, Rt. Hon. Sir H.

  Wood, Rt. Hon. Sir K. (Woolwich, W.)

  Edwards, Walter J. (Whitechapel)

  Peat, C. U.

  Woodburn, A.

  Erskine-Hill, A. G.

  Petherick, Major M.

  Etherton, Ralph

  Pethick-Lawrence, Rt. Hon. F. W.

  TELLERS FOR THE NOES.—

  Findlay, Sir E.

  Peto, Major B. A. J.

  Mr. Pym and Mr. A. S. Young.

  The Deputy-,Chairman (Mr. Charles Williams): Mr. Craven-Ellis.
  Sir. H. Williams: May I ask leave to move to report Progess?
  The Deputy-Chairman: No.

  NEW CLAUSER.—(Provision as to deduction in computing excess profits.)
  (1) In Subsection (2) of Section thirty-three Of the Finance Act, 1940 (which deals with
  434
  the computation of profits for excess profits-tax), the following proviso shall be inserted after the words "as the Commissioners think proper,"—
  Provided that, no such deduction shall be treated in such a manner as to increase the amount of the liability to the excess profits tax above the amount which would have been payable if the expenditure represented by the deduction had not been incurred.
  2) The amendment effected by this section shall have effect with respect to tax for all

  435
  chargeable accounting periods, whether before or after the passing of this Act.—[Mr. Craven-Ellis.]
  Brought up, and read the First, time.
  Mr. Craven-Ellis: I beg to move, "That the Clause be read a Second time."
  The object of this new Clause is to endeavour to get rid of what many Members consider to be a great injustice under the Excess Profits Tax. I would refer the Chancellor to Subsection (2) of Section 33 of the 1940 Finance Act, in which the Commissioner has the opportunity of accepting or not accepting definite expenditure, say for repairs, and of deciding that the expenditure shall be spread over a period. He has, to a large extent, to investigate when similar repairs were required previous to the expenditure in question. It may be decided, that the period is to years and the Commissioner will say that the expenditure shall be spread over 10 years. I will quote one or two figures. I do not intend to burden the Committee with the whole of a complicated statement which I have prepared to support my Clause, so I will hand it to the Chancellor when I have finished. Suppose there is an expenditure of £10,000 in 1941. That is spread over Io years, which means that in that year only one-tenth is brought into account. The balance is carried back to previous accounts. These accounts can be re-opened, and I should like to ask the Chancellor whether the Statute of Limitations does not come into question? If the 10 years is the period of spread, what will be the position for those years which do not come within the six years in which it is allowed to re-open the accounts? I should like the Chancellor to give the Treasury view on that point.
  The £10,000 having been treated in this way, it means that in 1941 the profits would be increased by nine-tenths. Then the one-tenth will be accounted for in the accounting period in question, that is 1941. This means that the total payment of E.P.T. is £10,000. It is true that Income Tax is lost by the Exchequer to the extent of £5,000. What is the position in subsequent years? This is a point I want to stress, because it seems to me that there is some injustice in the operation of this Section. It means first that the profits are increased by the reduction of standard profit by £10,000 a year. Then
  436
  there is the question of capital adjustment. I am taking the period from 1941 when the expenditure was incurred to 1947 to give an example of the effect of the cost in terms of E.P.T. The result of this decision by the Commissioner is rather interesting but somewhat alarming. It means that in seven years the E.P.T. payable is more than twice the amount of the cost of the repairs. It is made up in this way. The cost of the full allowance in 1941 is £10,000, the cost of the decrease in Standard profit for 1942–47 £10,000, and the cost of the consequential capital readjustment £4,132. From 1941 to 1947 the total cost which is incurred for this £10,000 expenditure is £20,132 and it will continue accumulating as long as E.P.T. is on the Statute Book.
  I am the last to say that there should be any profit in war, but I must draw the attention of the Committee to the possibility of these anomalies. They are not intentional and it is how things work out, but when anomalies arise we must try to correct them. If these anomalies are not adjusted, I fear that we shall shake the whole foundation of industry. If we do that we shall be in a difficult position in regard to getting full employment when the war is over. We must have regard to what the post-war position may be, however sincere and determined we are that the first consideration must be the wining of the war. Charging expenditure on repairs in this way is no encouragement for the owners of industrial property to keep them in proper repair. We do not want to have a policy of taxation which will lead to a lower standard in that respect.
  The Attorney-General: As my hon. Friend recognises, these points are a little difficult to follow in Debate. My right hon. Friend will certainly look at the Case which my, hon. Friend has put forward and the table of figures which he has prepared with regard to it. We cannot accept the principle in the new Clause and I feel sure that my hon. Friend will not press it. The principle is that
  "no deduction shall be treated in such a manner as to increase the amount of the liability to the Excess Profits Tax above the amount which would have been payable if the expenditure represented by the deduction had not been incurred."
  If you are dealing solely with expenditure in the chargeable period no doubt that is

  437
  a principle on which one can work to see how far there can be any departures from it. But if you consider an expenditure covering more than one year of the standard period which obviously has to beg, spread back, then necessarily the taxpayer's liability would be greater. I understand from what my hon. Friend said that the case he has in mind is one in which the expenditure was made in the chargeable period and was then spread backwards. I do not think the Statute of Limitations comes into it, because that really deals with the question of how far you can recover money or tax by legal process. The point of this Section is to enable sums payable in one year to be spread over other years in order to arrive at the proper figure. I hope that my hon. Friend will be content with the assurance of my right hon. Friend that he will look into this case.
  Mr. Craven-Ellis: On that assurance and that explanation I beg to ask leave to withdraw the Clause.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Additional allowance in computation of standard profits.)
  (1) In the proviso to Sub-section (2) of Section thirteen of the Finance (No. 2) Act, 1939 (which deals with the computation of standard profits), insert at the end,—
  "and in the case of any other trade or business the Commissioners may, if they are so satisfied and think fit, direct that there shall be allowed, in addition to the minimum amount, such further sum not exceeding one thousand pounds as may be specified in the direction."
  (2) The amendment effected by this Section shall have effect with respect to tax for all chargeable accounting periods, whether before or after the passing of this Act.—[Mr. Craven-Ellis.]
  Brought up, and read the First time.
  Mr. Craven-Ellis: I beg to move, "That the Clause be read a Second time."
  This new Clause relates to what is known as the minimum standard. If you are in business or trade as an individual, your minimum standard will be £1,000, but if you are in a partnership or are one of three working partners, your minimum standard will be £4,500. The object of this new Clause is to put the person who is the head of a trade or business into the more favourable position of those in a
  438
  partnership or company. I will quote an example which I hope will convince the Committee that there is some justification for this Clause. Let us look into the case where the minimum standard for the individual who is in trade or business is £1,000 and the minimum standard for the partnership or for a company with three working partners is £4,500. Contrasting those cases we see the varying effects of the minimum standard. Let us assume that the current year's profits were £5,000. The individual who is running the trade or business would have to pay E.P.T. on the differences of the £1,000 minimum standard and £5,000 current profits, and therefore he is burdened with a tax of £4,000. In the case of the partnership with three working partners or the company with three working partners, the difference between their minimum standard of £4,500 and the current years profit of £5,000 means that E.P.T. is payable only upon £500. That difference does deserve some consideration in order that the individual can be put on a par with a partnership or a company.
  Sir K. Wood: My hon. Friend has put forward a case for my consideration and I would offer just one or two observations concerning it. I think he has omitted a matter which has a very material bearing on the question, namely, why Parliament came to the decision it did on this question. Generally speaking, apart from the merits of the Clause, I feel that unless a very strong case is made out, it would be wrong for me, at this stage, in the life of the Excess Profits Tax to begin to make considerable variations in its general provision, which were decided by Parliament after considerable Debate. It must not be said that I would not endeavour to deal with any difficulties which may arise, but the tax has been in operation for some time, and we may now look forward not so much to its continuation as, perhaps, to the day when it will disappear altogether. I think the Committee will appreciate the view I must take of proposals for substantial alteration at the present time.
  But let me point out that there is, of course, a material reason for the variation between the two, classes of cases. The Section of the Finance Act to which the hon. Member referred me is Section 13 of the Finance (No. 2) Act, 1939, as amended by a section of the Finance Act,

  439
  1940. It provides for a general minimum standard of £1,000, but enacts that in the case of the trade or business carried on by a single individual, a partnership or a director-controlled company, the normal minimum standard shall be £1,500 for each working proprietor in the business, subject to a maximum of £6,000. It is true that there is a provision which gives the Commissioners of Inland Revenue a discretion in respect of not more than £1,000 for each working proprietor, or £4,000 in all, where they are satisfied, having regard to the nature and size of the business, that the normal standard is inadequate.
  My hon. Friend is now suggesting that because a discretion is given in that class of case there ought to be a similar discretion in the case of other businesses with which this Clause is concerned, namely, those companies which are not director-controlled. There is, however, a very clear distinction between the two types of case. In computing for Excess Profits Tax purposes, the profits of a business carried on by a single individual, a partnership or a director-controlled company, no deduction is allowed in respect of the remuneration or drawings of the individual proprietors, partners or proprietor-directors, but when you come to the question of trades or businesses in which all remuneration paid even to the directors and proprietors is allowed as a deduction when computing profits, so long as they are not unreasonable, there you have a very clear indication of why Parliament made the distinction and gave the discretion to the Commissioners in one case but not in the other. Whilst I will examine the case further in the light of what my hon. Friend has said, to see whether, on reflection, further consideration ought to be given to this matter, in view of the very clear distinction between the one case and the other I doubt very much if I shall feel able to go further.
  Mr. Craven-Ellis: There was part of the Chancellor's remarks which rather disturbed me. He said: "We have gone so far," the implication being "Why bother? We have gone so far and let us do the rest of the journey in the same saddle." That may be all right, and one would not complain if the case which I put forward did not expose the vast dis-
  440
  tinction there is between one class of profit and another. However, I am pleased to have had the Chancellor's statement, and I think it was useful, and I beg to ask leave to withdraw the Clause.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Repeal of armorial bearings duty.)
  (1) The duties of excise chargeable under the Revenue Act, 1869, in respect of armorial bearings shall cease to be chargeable, and no licence stall be required to be taken out under that Act in respect of the wearing or use of armorial bearings.
  (2) This section shall come into operation on the first day of January, nineteen hundred and forty-four.Ȕ[Mr. Brooke.]
  Brought up, and read the First time.
  Mr. Brooke: I beg to move, "That the Clause be read a Second time."
  The Armorial Bearings Duty is an obsolete tax which cannot be enforced, brings in only a tiny revenue, and ought to be abolished. The Committee will see from the proposed new Clause that it has continued untouched since 1869, so at least the Chancellor will agree that it is time we took it out of the cupboard and had a look at it. The Act of 1869 imposed a duty of two guineas a year on anybody who used armorial bearings on his carriage, and one guinea a year on anyone who uses armorial bearings or any kind of crest, device or ensign otherwise than on a carriage. Let me make it clear that this duty and my speech have nothing whatever to do with the grant of the right to armorial bearings. You have to pay the duty whether the bearings relate to your family or not; if you have a crest of any kind on a seal or signet-ring, a piece of silver plate or china, whether it is your own or not, you are liable for a guinea. I hope I do not see any hon. Members looking guilty. I must warn them that the penalty for non-payment is £20.
  The Act of 1869, which I have here, imposed a variety of duties by Section 18 on male servants, carriages, horses, mules, armorial bearings, and horse dealers. Over the years we have got rid of all those obsolete duties, even that upon horse dealers. The duty on male servants went six years ago, and now we are left with only the duty on armorial bearings. In the years from 1870 to the outbreak of the

  441
  last war, the duty used to bring in £70,000 or £80,000 a year, quite a tidy sum in relation to the Budgets of those days. Since then the yield has been growing smaller. For one thing, carriages are less used and therefore the two-guinea duty hardly brings in anything now, although it is chargable on armorial bearings on motor cars. The £80,000 fell to some £50,000 after the end of the last war, and the yield continued to diminish until, immediately before this war, it was only £33,000. For the last year for which figures are available, the year 1941–42, it was down to a meagre £23,000. That is the sum of money which the Committee are discussing.
  It is clear that there is evasion on a wide scale; yet my own belief is that evasion is not the main cause of this diminution in the last 20 years, but sheer ignorance that such a tax is payable. Elderly people who have paid it all their lives realise the fact and are pricked by their consciences when they have not paid their guinea, but the majority of younger people have never heard that there is such a tax. There is a difficulty in the way of the Chancellor doing the obvious thing and sweeping the tax out of existence immediately in that this House decided in 1909 that tine Armorial Bearings Duty in England and Wales should in future be collected and retained by the local authorities—county councils and county boroughs—though it continues to be collected and retained by the State in Scotland. When previous Chancellors have been questioned about this matter they have been inclined to use the argument that the tax is now out of their control and that enforcement is up to the local authority. They have suggested that if there is unfairness or inequity it is the fault of the local authority. The matter may be out of the control of the Chancellor of the Exchequer, but it is certainly not out of the control of Parliament. We have imposed the duty, and it is our task to make certain that it operates fairly between one taxpayer and another. Either it is enforced on all, or if it is proved unenforceable it should be repealed. If it is argued that the local authorities should be more active in enforcing it, because the revenue accrues to them, let us see in practice what that would mean. It would mean that the——
  Sir K. Wood: May I interrupt my hon. Friend to say that I shall not use any of those arguments to-day? Perhaps I shall
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  be able to make a statement which will be satisfactory to my hon. Friend, so that we can get on with the Bill.
  Mr. Brooke: I am very pleased to hear what the Chancellor has just said. In 1798, just before Nelson won the victory of the Nile, Parliament first imposed an Armorial Bearings Duty. It has lasted for 145 years. I hope that this moment, when we have just again cleared the Mediterranean of the enemy, may be another landmark in its history.
  Sir K. Wood: I have a great deal of sympathy with what my hon. Friend has said. It looks to me as though this tax has exhausted itself. It is a matter with which the local authorities are concerned, as he has said, and also the authorities in Scotland. Following the proposal which my hon. Friend has made, I will undertake to consult the local authorities and the people concerned, with a view to making a proposal in connection with this matter next year. Obviously, I cannot do it without consultation with them, but it does not seem to me that there is very much in this duty from my point of view. It may be rather an unnecessary and vexatious burden that is not worth collecting.
  Sir H. Williams: This is an occasion when the right hon. Gentleman need not worry about anticipating his Budget statement. Does he think he will be able to make some statement within some reasonable time before his next Budget? This is a very strange tax. It is really a tax upon illiteracy. I believe that armorial bearings were invented to certify documents of people who could not write.
  Mr. Assheton: No. For going into battle.
  Sir H. Williams: These people had clerks in holy orders who could do the writing. Of course, these bearings were also a farm of snobbery. The Committee should be very grateful to the hon. Member for West Lewisham (Mr. Brooke) for bringing this matter before us and also to the Chancellor for the generous attitude he has adopted. Naturally, any statement made by the right hon. Gentleman would bind not only him but his successor, unless some very revolutionary change takes place in the composition of the Government. It would be helpful if he could let us know some reasonable time

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  before the next Budget the result of his consultation with the local authorities. Some of us are interested in these financial matters, and it is just as well to discuss them with some care and consideration.
  Sir K. Wood: Yes, I will do that.
  Mr. Goldie: As one who has paid the Armorial Bearings Duty I should like to make what I hope will be regarded as a helpful suggestion. I have in my possession a gold watch which I got from my father. At the back are some scratchings and when I asked my father what they were he told me that his father, my grandfather, had the family crest taken off the watch in 1869, because he flatly declined to pay the duty. My one regret is that the old gentleman did not go the whole hog because I have also in my possession a considerable amount of family silver which, to my great discontent, has the crest on it. It is not pleasant for people to have to pay tax for something of which they thoroughly disapprove. If anybody is sufficiently a vulgarian to want an armorial bearing or a crest on his motor car, I say let him pay for it up to the hilt. Let the Chancellor take off the tax on old family silver and rings, and increase it as much as he likes on coats of arms on motor cars. It seems to me that that would get us out of the difficulty and certainly would not place an increased burden on the revenue.
  Mr. Benson: I do not wish to take up much time on this matter, but I do wish to thank the Chancellor. I suggest that war time, when he is budgeting for a deficit of £2,000,000,000 or £3,000,000,000 a year, is the time when he might go with a duster through our financial machinery and sweep away a large number of these little trivial taxes which have accumulated over centuries, which bring in little or no revenue but which make our machinery complicated. I hope that between now and next year, he will see which of these taxes he can get rid of.
  Mr. Brooke: I am very grateful to the Chancellor. I hope he will find it possible to make an announcement before 1st January next, when the tax will otherwise become payable for 1944. I beg to ask leave to withdraw the Clause.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Deduction in respect of certain subscriptions.)
  Rules 9 and 10 relating to Schedule E of the Income Tax Act, 1918, shall be construed as providing that any amount (not exceeding £15 in the aggregate in any year) paid by any person by way of subscription to any institution or other body which is, in the opinion of the Treasury, conducted wholly or mainly for the advancement of any branch of learning, science or technology and not operating for profit, may be deducted from the salary, fees or emoluments to be assessed in respect of such person.—[Mr. Linstead.]
  Brought up, and read the First time.
  Mr. Linstead: I beg to move, "That the Clause be read a Second time."
  The object of this Clause is to repair an anomaly in the present law which bears rather hardly on certain of those who practise various branches of learning, science or technology. I can best illustrate the anomaly by referring very briefly to a distinction which the present law makes between scientific men who are practising their profession independently and scientific men who are practising their profession as employees. In the first case, the man who is carrying on some branch of science as a profession is, of count, assessed under Schedule D as a person who is carrying on a profession, whereas the employee is assessed under Schedule E as holding an office or employment. The independent professional man is entitled to deduct for Income Tax purposes any annual subscription to a scientific body which gives the right to use a qualification. No such concession is allowed to the scientific man who is employed, unless it is a condition of his employment that he should belong to that particular scientific society.
  The anomaly, I think, can best be illustrated if one takes the case of a public analyst. Supposing there was an analytical chemist practising on his own account, who was also a part-time analyst to a city or county or borough. He would be entitled to deduct his subscription, for example, to the Institute of Chemistry or the Chemical Society because that is a subscription to a society giving the right to use a qualification. But if the same man were a borough analyst full-time and, consequently, an employee he would not be entitled to deduct subscriptions to those scientific bodies unless he had been able to persuade his employing local authority to make membership

  445
  of those bodies a condition of his employment. This encourages attempts to escape the provisions of the law by employees who try to persuade the local authority, or whoever employs them, to impose membership of scientific societies as a condition of their employment. That is extremely clumsy and extremely inequitable because many employers naturally hesitate to assist in what they believe is an evasion of the law.
  One recognises that the Treasury's duty is to safeguard the revenue, and I can well imagine that the Chancellor may say to us, "If I begin to make this concession in the case of a certain group of people—those who are practising science—I shall have a very large number of applications from other groups in the community for similar concessions." He may also say that it is difficult for the Treasury to decide which subscriptions to which societies should be entitled to this exemption. I think the answer to both those objections would be that there is in existence to-day for the use of Income Tax inspectors a list of societies, the subscriptions to which are allowed when the professional man is working on his own account, and that list of societies would be available if the same concession were to be extended to the man working as an employee.
  One does not want, in dealing with financial matters, to appeal ad misericordiam. It is the duty of the Chancellor to harden his heart but nevertheless—[Interruption.]—we will see if we can bring about a chemical transformation of the Chancellor's heart and get it a little softer. The point I wish to make is that, generally speaking, the employees, the people who would benefit from this concession, are the more lowly paid scientific personnel. It is extremely difficult for a young graduate of a university who may be receiving £5, £6 or £7 a week to join the various scientific societies he would like to join, and which he ought to be encouraged to join, when the subscriptions may total £8 or £9 a year. The older man working on his own account will be able to afford them but the young man, who is full of enthusiasm and is mostly likely to benefit from the research work of scientific institutions, finds it most difficult to pay the subscriptions.
  This is really part of a larger question. This war has been described as a
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  scientists' war, and when it is over we are going to have a scientists' peace. In other words, there will be a colossal amount of work for scientific personnel to undertake. We have had the example of pre-war Germany, which was able to integrate all its scientific elements—universities, technical schools and industry. After this war we want to see a similar thing happen here, with every encouragement given to scientific people to join the appropriate professional scientific bodies. I am sure that any concession the Chancellor might be prepared to make would be amply repaid in the dividends, which would be forthcoming for the nation as a result of the encouragement it would give to science and scientific people.
  Mr. Edmund Harvey: The plea that has been made by my hon. Friend ought, I think, to commend itself to the Committee. I do not know whether he can accomplish the miracle he set out to do, because the softening of the heart of a Chancellor of the Exchequer on the occasion of a Finance Bill is as rare an event as the liquefaction of the blood of St. Januarius. [Interruption.] Well, perhaps it occurs occasionally. This is a small concession to ask for from the point of view of the nation, but a large concession from the point of view of a great number of public servants—as I think they are, in the widest sense of the term—who are giving their services for very small salaries, in research in connection with industry, in other forms of research, and in the technical branches of all the most important industries in the country. It is in the national interest that they should keep abreast of the times, and that they should be able to interchange their experiences and knowledge with their colleagues In other firms, universities, and institutes. Unless they are able to be members of these scientific societies, that is extremely difficult. We all know that the Chancellor of the Exchequer wishes to encourage the advancement of science and its application to industry, and this is one way in which he could give encouragement of that kind, at very little cost to the State.
  As the law stands, it is possible for a professional scientific worker, working on his own account, to certify in his returns certain subscriptions to scientific societies

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  as being essential to his work, and to get an allowance for them; but if he is working for a firm, he depends on that firm being willing to make such a certification. The managing director may take a narrow view, and may not realise the great importance of the man continuing as a member of the scientific or professional society in which he wishes to continue membership; and so he may not certify. Then there may be natural reluctance to ask the heads of a firm for a certificate of this kind. It is not fair that there should be such a disparity between a scientific worker who is working on his own account and another who is in the employment of a large firm or of some university. Again, it is important that those who are working as members of university staffs or in research laboratories not connected with industry should be encouraged and helped to continue in membership of societies which they have already joined, or of which it is necessary for them to be members. It is deplorable that so many of our scientific men, especially those engaged in research, should be so badly paid. Their salaries are in most cases far lower, than would be the case if they were employed in corresponding work in the United States. They have to meet these charges from a very modest income. In this country we do far less than is done in the United States to encourage technical and scientific research. Here is a practical way of giving such encouragement. I earnestly hope that the Chancellor of the Exchequer will be willing to accept the principle of the Clause.
  The Attorney-General: I would like to congratulate my hon. Friend the Member for Putney (Mr. Linstead) upon the way in which he presented his case for this Clause, although I am afraid he may not have effected what he hoped. It is true that this raises a problem, but it is part of a wider problem. As my hon. Friend pointed out, there is, from a certain point of view, a difference between the criterion applying to a professional man who is working on his own, and who may make nothing, and that applying to the professional man who is employed, and who gets a fixed salary. The man who is employed and gets a fixed salary, if he wishes to deduct such a payment, whether it is a subscrip-
  448
  tion to a society or anything else, has to show that that expenditure is necessary for the purposes of his employment. That is a narrower test than that which applies when he is working on his own, and has to show that it is necessary for the purposes of his activities. I do not want to be technical—nobody ever does—in tying people down to the words on the Order Paper, but the Clause is quite unrestrictive. It might enable me, for instance, to deduct a subscription to an archaeological society. It does not relate the society to the employment in any way. I do not think that that is due to inadvertence, but to the difficulty of doing so. This point has been considered from time to time: it has Come before the Courts and it is realised that it raises a great difficulty as to where you are to draw the line. That is the point. One of the learned judges who decided a case on this question—obviously rather a hard case—relating to a medical officer of health who subscribed to some society, said:
  "I think that all subscriptions to professional societies and all taking in of professional literature and all that sort of expense which enables a man to keep himself fit for what be is doing are things which can none of them be allowed. If they were allowed every professional man would say, I have to belong to this society and I have to belong to that society; I have to take in this publication and I have to take in that publication and to do all sorts of things, and there would be no end to it."
  I think that if there were cases where you could draw a satisfactory line, we would be glad to do it, but you cannot. The subscription to a learned society is only one example of the type of expenditure which a scientific man who is in salaried employment will experience. There is the buying of text books for keeping himself up-to-date. In some walks of life it can get further away. There is the schoolmasters' travelling; he may do it, in part at any rate, to keep himself fit for the work he has to do. Take the case of a don at a university. It is obviously desirable that he should spend part of his emoluments in entertaining, in having to tea and so on, some of the students under his care. Obviously that is not the kind of thing he could deduct for Income Tax purposes. I appreciate what the hon. Member for the Combined English Universities (Mr. Harvey) has said, and that it is not always easy for the man to go to his employers. The proper solution is,

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  of course, that those who employ professional men, scientists, schoolmasters, and so on should pay them a salary which enables them to keep themselves fit for their employment, by subscriptions to learned societies, by buying books, by travelling, by entertaining the parents of their scholars, and so on. If the expense is necessary and cannot be deducted, and if it is an undue burden, the proper thing is for representations to be made by those who are interested, or by the organisations dealing with that side of the lives of the people concerned, to see that they get salaries which enable them to keep themselves fit for their employment.
  Viscount Hinchingbrooke: I am not entirely convinced by the answer of the learned Attorney-General. I understood that there is a list, prepared by the Income Tax authorities, used for the purposes of Schedule D, and, if so, why is it not possible to use the same list for this purpose under Schedule E? We are asking that exactly the same conditions should apply to those who are under Schedule E.
  The Attorney-General: It really is different. A Schedule D man may get nothing at all. A Schedule E man gets a fixed salary, and a Schedule D man may get nothing unless he makes a profit, which is to some extent a check on expenditure on this account whether made in respect of learned societies or on other purposes. That is the reason why under the Income Tax law the man who gets a fixed salary has to show that it is necessary, and for the man who is on his own and may make nothing in a particular year it is sufficient to say that it is for the purpose. Once you extend the principles to the man with a fixed salary—and the quotation of the learned judge supports it from that angle—it is extremely difficult to draw the line.
  Sir H. Williams: Will my right hon. and learned Friend give me some free advice on a matter in which I am personally interested? On Monday I was present at a board meeting of an engineering company when we discussed the question of whether we should encourage the technical members of the staff to join scientific and learned institutions in order to keep themselves up-to-date. Such a process would be to the advantage of the company in the long run, and we were speculating as to what our position would be as a company if we paid the subscriptions
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  of employees to scientific institutions and whether that would be a taxable expense. It is not the narrow interest with which I am dealing but the larger interest. It is a good thing to encourage people to get into touch with the various technical societies, and the more people belong to them the better. It does not merely give them status by having letters after their name, but it gives them access to literature and the opportunity to attend important discussions. It is vitally important to enable those engaged in scientific occupations to keep abreast of the times, and would my right hon. and learned Friend oblige me by saying what is the position of the employer who decides to pay his employees' contributions to such a society? Can the employer treat it as a working expense of the business?
  The Attorney-General: If that question had been asked at Question time, I would have said that I would like to see it on the Paper, but if my hon. Friend will write to my right hon. Friend, I have no doubt that he will assist him if he can.
  Mr. Barnes: Perhaps when the right hon. and learned Gentleman is examining this correspondence he will also examine whether contributions of members to trade unions can be so treated.
  Mr. Linstead: I still maintain the opinion that we have here an anomaly which ought to be removed, and with every respect to the learned Attorney-General I find very little justification for the Treasury not taking some action in what he has told us. He has indicated all the difficulties which might arise if you apply to Schedule E the conditions that at present apply to Schedule D, but he did not explain to us how it was these difficulties have not arisen in so far as at present the Schedule D men get the benefit of this exemption. I did not find, to my regret, that he was very convincing, but he conjured up imaginary difficulties, when, in present circumstances, such difficulties cannot arise. We shall have to plug away at this. I am certain that it is something which ought to be put right, but obviously at the moment there is nothing to be gained by taking the matter further, and I therefore beg to ask leave to withdraw the Clause.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Moneys not required.)
  There shall be added to paragraph 3 of Part II of the Seventh Schedule to the Finance (No. 2) Act, 1939, a new sub-paragraph:
  "In ascertaining the amount of any moneys not required for the purposes of the trade or business in any chargeable accounting period regard shall be paid not only to the current requirements but also to such other requirements as may be necessary or advisable for the maintenance and development of the trade or business."—(Sir P. Bennett.)
  Brought up, and read the First time.
  Sir Peter Bennett: I beg to move, "That the Clause be read a Second time."
  The question is one of the capital which remains idle during certain periods in the life of a business. It will be within the knowledge of hon. Members haw this becomes important under present conditions. The amount of capital which is left in a business is part of the computation in arriving at the standard. Under normal conditions cash goes in and out of a business, but during the present conditions many of the tendencies are very much exaggerated. In every case new sets of conditions are set up. My hon. Friend the Member for Exeter (Mr. A. C. Reed) who would have moved the Clause had he been able to be present, would have told us the story of the paper pulp trade. There is an industry which must carry very considerable stocks. This is due to the fact that they have to get their stocks at a certain time of the year before the Baltic closes and hold them for the whole of the winter. What has happened in the present conditions is that control has come in and all their stocks have been taken over and paid for. They are allowed a certain amount of their own stock which they hold as storekeepers. Incidentally, they have to pay a considerable amount more for them after they have sold them to the Control, but that is not a matter for any grievance, because it comes under war conditions, and everybody understands it.
  The problem is that they have on hand a considerable amount of money. If that is treated as money which is not needed in the business, it will be disallowed, but they maintain, and must maintain, that that money is in the business because at a later date they will have to restock, probably suddenly. They cannot take the money out and return it to share-
  452
  holders or invest it in other directions, because they may want it again very quickly. Therefore, they are holding it, but if the Revenue authorities say that this capital is no longer wanted in the business and they insist on its being deducted from the standard, it reduces the amount they are allowed to retain. Many of these industries are passing through a difficult period, and any amount that is deducted will be a serious matter for them. Other industries concerned are those dealing with oils and fats, which are in the same state. They have had to seal down their activities, and in consequence they have collected money and are very anxious that that money shall not be deducted in computing and working out the amount of their standard.
  There is another class of industry with which I am personally concerned—the production engineering industry—where the amount of cash which has to be carried varies considerably over a long period, particularly in the motor car and aeroplane industry. You cannot take one year and say that the average amount of cash you carry then is the figure. For instance, in making a model you have to put out a certain amount of cash at the start, and later you have to reduce this amount as the model is finished and then spend cash on making jigs and tools to start production. When the Chancellor of the Exchequer was Secretary of State for Air the aeroplanes that we have now were being talked about as models in the spring of 1939, when shops were being cleared to make way for their production. In due course those planes will fade out, and others will come in. So it can be seen that in manufacture of this description you have a cycle of cash which varies over a long period. We want the Revenue to differentiate between redundancy and reserve. If capital is redundant, of course we can understand that it could be taken out, but there is a great deal of difference between redundant and reserve capital, just as there is between redundant and reserve plant. The production engineering industry carries stand-by plant which is not used and which we hope will never be used, but that plant is not called redundant. It has to stand by in case of emergency. So it is in the case of this capital. When it is wanted at some period, we ask that it should be treated differently. The Revenue authorities should be empowered

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  to treat each case on its merits. Yesterday I heard the Chancellor advise people that when they had a problem they should take it to the Revenue officers. Personally, that is the advice I have always followed, and I have always had their help. One of them once said to me, "Do not think that we are ordinary tax collectors whose only duty it is to see that the State gets everything it should get. It is also our duty to see that the State does not get anything it ought not to get. I am here to look after your interests as well as theirs." I maintain that this new Clause would help the Revenue authorities in dealing fairly as between the State and individual firms in cases where such treatment is necessary.
  Sir K. Wood: My hon. Friend has made a very clear statement of the position, and I am much indebted to him for the information which he has put before me and the Committee to-day. I will, of course, carefully study what he has said, but I would like to make one or two observations on the present position. The object of this new Clause, which relates to the treatment of money in computing capital for E.P.T. purposes, is to provide that money shall be included in such capital to the extent not only of current requirements but also of
  "such other requirements as may be necessary or advisable for the maintenance and development of the trade or business."
  Some hon. Members will recollect that under the Finance Act, 1939, in computing capital for E.P.T. purposes investments are to be excluded, with one or two exceptions which I need not go into now, and any moneys not required for the purposes of trade or business are to be left out of account. That is an essential condition to prevent taxpayers being able, by keeping surplus money in the form of cash, to take advantage of what is a compratively high percentage addition which is allowed on increases of capital. That percentage is to-day 8 per cent. I think the Committee and my hon. Friend will agree that it would clearly be unreasonable that a taxpayer should derive financial advantage by receiving an allowance for increased capital at 8 per cent. in respect of money which is, in fact, lying idle at the moment. The exclusion of the money not required is designed to prevent that state of affairs.
  My hon. Friend talked of money which might be required for certain purposes,
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  and it occurred to me that it ought to be quite possible, with all the forms of investment now available, for a firm to invest that capital in any one of the lines of articles which I have on my counter to-day. It is true that the law does not define what money is "not required" for the purposes of E.P.T., but the amount of surplus cash is determined in practice in the light of the needs of the business, due regard being paid to impending liabilities and the cash which may be expected to become available to meet them. It may be interesting to the Committee to know how, broadly speaking, the Revenue treat cash balances. They treat them as not required only so far as they include surpluses unused throughout the period under consideration; they do not seek to eliminate temporary surpluses absorbed during the accounting period, or cash representing the accruing profits of the period, or a reasonable margin for contingencies. I suggest that in that way the Revenue is meeting the position, having regard to the requirements of industry and the position of the taxpayers. I think my hon. Friend will see that if I acceded to his request and accepted his new Clause it would give an undue advantage.
  Sir P. Bennett: I fully appreciate the point which the Chancellor has made although I thought I emphasised particularly the fact that capital which was redundant should be taken out. He hinted at what could be done with Surplus cash, and, of course, that is being done, but a certain amount must be always kept on call. It is only a matter of discussion with the Revenue authorities as to what is the essential amount. As I have said, a certain amount must be kept ready for immediate use and I commend that point of view to the Chancellor in begging leave to withdraw the Motion.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Appeal against decision of Commissioners.)
  There shall be added to paragraph so of Part I of the Seventh Schedule to the Finance (No. 2) Act, 1939, as amended by Subsection (5) of Section thirty-three of the Finance Act, 1940, the following subparagraph:
  "(3) Any person who is dissatisfied with a decision of the Commissioners under this paragraph may appeal to the board of referees."—[Major Gates.]
  Brought up, and read the First time.
  Major Gates: I beg to move, "That the Clause be read a Second time."
  I am seeking the indulgence of the Chancellor in putting forward this new Clause, because my hon. Friend the Member for Stockport (Sir A. Gridley) had hoped to be here to move it himself, and I have only my recollections of talks with my hon. Friend to guide me in this matter. This Clause and the one that follows deal with the discretion of the Commissioners. We feel that in the paragraph referred to it is too limited. I wanted to put down a Clause widening their discretion, but it was finally decided to try to get the Chancellor to agree to a Clause giving a right of appeal to the Board of Referees. The sort of trouble that the Clause seeks to correct, if I may give an example, is the case of a company which was director-controlled before the war, but which is not controlled in the E.P.T. period. It usually has the directors' remuneration disallowed as if it were controlled, but the percentage on extra capital is reduced from 8 to 6 per cent. The company is therefore treated as director-controlled as far as the directors' remuneration is concerned and as non-director-controlled as far as the percentage on new capital is concerned. The Revenue thus has the best of both worlds. That is what the discretion of the Commissioners amounts to. And as it can be exercised either way sympathetically or harshly it was felt that it was only just and equitable that power should be given to the taxpayer to appeal to the Board of Referees.
  Another example of what we are trying to get at is a company which was not controlled pre-war but is director-controlled in the E.P.T. period and has its standard reduced by deducting the directors' salaries, and its E.P.T. profit increased by adding those salaries. Here the discretion of the Commissioners is limited although they may give a countervailing advantage by the extra 2 per cent. which is allowed on increased capital. But there may be little or no increased capital so the 2 per cent. may be inadequate to cover the difference, and thus the discretion of the Commissioners is inadequate and not wide enough. So if the alternative of giving the Commissioners wider discretion is not taken it seems only fair that the taxpayer should have a right of appeal to the Board of Referees.
  Sir Arnold Gridley: I do not think there is much that I need add after the very clear way in which my hon. and gallant Friend has moved the Clause. There is a wide desire to have the right to bring the decision of the Commissioners before the Board of Referees, and I think I might ask the Chancellor to be accommodating to us, because all we are asking for is that greater discretion should be given to the consideration of these questions and that, where injustice is felt, those aggrieved should have the right to go from the bureaucratic decision of the Commissioners to a Board of Referees, which, after all, has its justification and its being for the purpose of dealing with matters of this kind.
  The Attorney-General: The general topic of the right of appeal from the Commissioners to the Board of Referees was discussed on the Finance Bill last year, and it was then pointed out that, in dealing with Excess Profits Tax, there are a number of cases, of which this is one, where you require to make adjustments to fit the particular facts of each case, adjustments which may depend on the amount of capital in the business and various other matters which do not arise in the case of Income Tax where you can apply a rigid code and express it in words. I was interested when the Mover said he and his friends had considered whether they should ask that the Commissioners should have a wider discretion or whether they should ask that there should be a right of appeal. That is interesting, because the Commissioners have frequently been pressed by those who are affected by this tax to take a wider discretion than they have at present to enable them to deal with special cases. The difficulty about an appeal is that, if you are going to have a right of appeal to a Board of Referees, you have to lay down a definite code of principles which they as a judicial tribunal, can apply. I believe on the whole, although of course the Commissioners' decisions have not given universal satisfaction, there has been no general complaint as to the extent of their discretion and, taking into account that if you have to decide something, you can never wholly please the people who come before you, I think they have not done too badly. I should have thought the subject matter of this Clause was a pretty good example of where it would be very difficult to formulate a general code. I do not

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  want to be too technical or to go into too much detail, even if I were capable of it, which I very much doubt, but one of the cases which would arise under the Clause is where a company was director-controlled in the standard period and not director-controlled in the chargeable period, or vice versa. There, it is right and proper and necessary that adjustments should be made.
  We have to take into account such facts as, for instance, when the company was not director-controlled, what director's remuneration could be deducted and what was included in that remuneration, whether it to some extent, as sometimes happens, included an element of share of profits as well as remuneration limited to the directors' duties. We then get questions as to changes in the capital structure of the company between the two periods. It is for reasons such as these, which I will not attempt to elaborate, that last year the House decided—and I think the House as a whole accepted it after argument—not to give a right of appeal to the Board of Referees, not out of any disrespect to the Board, but simply because if we were to give this right we would have to formulate the code which the Board should apply.
  Therefore, I am afraid we cannot advise the Committee to accept this new Clause. Whether it will satisfy my hon. Friends or not I do not know, but all we can say to them to-day is that if they think the 2 per cent. is inadequate or the use which is made of the discretion under Section 33 (5) (2) of the Finance Act, 1940, is not being exercised fairly, and if they know of a particular case or any class of cases which give grounds for reconsidering the matter, representations can of course be made to the Commissioners that they should use their discretion somewhat differently from the way in which they have been using it and so forth. We think it would be quite impracticable, however, to formulate a code to deal with this class of case, as with the others, and therefore an appeal to the Board of Referees is an impracticable solution.
  Major Gates: I find-myself in a personal quandary, because I have been listening to my right hon. and learned Friend very carefully to see on which side he was coming down as between my hon. Friend the Member for Stockport (Sir A. Gridley) and myself. It rather seemed that if this new Clause had been changed
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  to give slightly wider discretionary powers to the Commissioners, we might have had a more favourable reply. I understand the reply to mean that the Commissioners, after the statement we have just heard, will give the broadest interpretation to their discretion. In these circumstances I beg to ask leave to withdraw the new Clause.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Changes in persons of directors.)
  There shall be added to paragraph so (1) of Part r of the Seventh Schedule to the Finance (No. 2) Act, 1939, as amended by subsection (5) of section thirty-three of the Finance Act, 1940, the following words:
  "Provided that if the standard profits of the trade or business are computed by reference to the profits of a standard period and the number or the persons of the directors in the chargeable accounting period have changed since the beginning of the standard period such increase in remuneration may be allowed as the Commissioners consider reasonable and necessary having regard to , the requirements of the trade or business in the chargeable accounting period."Ȕ[Major Gates.]
  Brought up, and read the First time.
  Major Gates: I beg to move, "That the Clause be read a Second time."
  This new Clause is intended to apply to cases where at present, as far as I can see, the Commissioners have no discretion at all. We feel that E.P.T. by its nature depends on comparing the profits of the standard period with the profits of the period of liability, but it is axiomatic that like must be compared with like. No difficulty arises in achieving this object where the company has always been controlled by the directors and where the directors have not changed. The Committee will remember that where the company is under the control of directors their remuneration is disallowed in the standard period and also in the chargeable period. In other words, it is a case of comparing like with like, with the net result that any increase in remuneration is liable. The Finance Act, 1940, quite properly makes provision for the case where the company at one time has been controlled and at another time not controlled, and it does this by saying that no deductions shall be made in respect of directors' remuneration except in so far as the Commissioners otherwise direct. In other words, the Commissioners have discretion to do what

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  is just and equitable within the spirit of the Act. The object of this new Clause is to extend that principle and continue the discretion of the Commissioners to those instances where there has been a change or alteration in the persons of the directors. The Finance Act, 1940, does not cover that situation.
  I want to give one example of what we are aiming at. Take the case of a man or woman who was a salaried employee of a company in the standard period and who has since become a director, though still carrying on the same duties as formerly. In the standard period that person's salary is deducted from the profits, thus reducing the standard, but in the chargeable period the director's remuneration, which may be exactly the same as the former salary, cannot be deducted from the profits, as it would be if it were a case of like with like and, therefore, fair and just, simply because his firm, comes within the definition of a company controlled by the directors and is a case where the Commissioners have no discretion. It will be seen from my remarks on the previous new Clause that I am a believer in the discretion of the Commissioners, and we seek to have that discretion extended to this sort of case. Yesterday we were chiefly engaged in the early proceedings in discussing football, and I have been careful to keep the score so far. The Chancellor has not had a single goal scored against him, but I believe that one hon. Member may have crossed the line for a try and will have a chance to convert on the Report stage and to obtain a goal. I am hoping that as this is the first time I have moved anything in this House, I have made some little impression on the Chancellor.
  Sir K. Wood: I think that my hon. and gallant Friend gave the best reason for granting his request in the last observation he made. It is one which always appeals to me very much, and I wish I could accede to it. I hope that he will not regard the fact that some of the Amendments have not been carried as indicating that these Debates are a sort of contest between me and the Committee. I am always ready to meet the Committee whenever I can possibly do so, and it may be that as we progress a little a genuine goal may be achieved. I hope that after I have given an explanation of what the
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  practice is my hon. and gallant Friend will be satisfied about the position. As I stated on a previous Clause, under the scheme of the Excess Profits Tax the director-controlled companies are treated, generally speaking, on the same lines as trades or businesses carried on by firms or individuals. In the latter type of cases no deduction is allowable in respect of the remuneration of the proprietor or proprietors. It is therefore appropriate that in the case of director-controlled companies no deduction shall be made in respect of directors' remuneration. That accounts for the fact that by the Finance Act, 1939, as amended by the Finance Act, 1940, a provision of that kind has been made.
  It is a fact that the law does not make any special provision for dealing with the case where there is a change in the number or the persons of the directors between the standard period and the chargeable accounting period, but where difficulties arise in such cases they are dealt with as a matter of administration, and such adjustments are made as may be appropriate to the particular case, bearing in mind—I emphasise this—the general principle that the company is to be dealt with on the same lines as a partnership. Thus, if a person was an employee in the standard period and became a director before the chargeable accounting period his remuneration in the standard period is normally allowed to be treated as not deductable, as would be the case in law if he were a partner in a partnership who had been a mere employee in the standard period.
  I think I am right in saying that this matter, perhaps in the broader aspect, was considered last year, or on a previous occasion, and I have, replied to one or two of the organisations which have made representations to me by saying that if I accepted this proposal, it would involve the negation of the principle of treating a director-controlled company as if it were a firm. I would also point out to my hon. Friends that if it were pressed to its complete conclusion, it would involve the Revenue authorities in having to adjudicate on "reasonable remuneration" in practically all the cases, and this is obviously a task which they are not particularly anxious to undertake. I hope that with this explanation of what we do administratively my hon. and gallant Friend may be content.
  Major Gates: I am not quite sure what the right hon. Gentleman means by "dealt with administratively." If I followed his remark correctly, it would seem that this point is sympathetically dealt with administratively—using his phrase. In that case his information and mine differ, because I have come across instances which have not been dealt with administratively in a sympathetic manner, and that is why we are asking for the Commissioners to have discretion in these cases. There is the obverse of the matter which I have not put: When a manager or important salaried employee of a director-controlled firm dies or leaves, in our present man-power situation the directors may not be able to replace him and may have to do his work themselves. That is what is happening in some small firms. Formerly they would have been able to deduct that late manager's salary from the profits, but if they do the work themselves, they are not allowed to adjust their remuneration for the extra work they do.
  Sir A. Gridley: I want to put forward two points for the consideration of the Chancellor of the Exchequer. I am sure that he does not want to make it more difficult for industries which are hampered by the shortage of man-power at the present time. If directors go abroad on active service, or die, or are called up to help in some Government Department, it may be necessary to fill the vacancies. One does not want to go outside, but to reward men who have served faithfully and well for many years in some managerial position by promoting them to the board. I am sure the Chancellor does not want to do anything which will hinder that most desirable practice. In the second place, we must have regard to the fact that the Minister of Aircraft Production, and possibly other Ministers, may find it necessary to make changes in directors. There have been cases already in which this has been done, and where it is necessary no one quarrels with it. Ministers may desire to take managers from their managerial positions and put them into positions as directors or managing directors. Those are two types of difficult cases which we are anxious about. We do not want the balance-sheet of the concern to be adversely affected by most desirable changes of that kind. Therefore, I would ask the Chancellor not to make it more
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  difficult for some of us who are faced with this problem, and are hesitating to make changes which we think would be desirable and helpful to the national effort because of the adverse financial consequences which would follow.
  Sir K. Wood: I will look into what both hon. Members have said in this connection and give consideration to it and communicate with them.
  Major Gates: In view of what the Chancellor of the Exchequer has said, I beg to ask leave to withdraw the Clause, but I would like to say that what is worrying so many of us is this question of promotions. The Army, the Navy, and the Air Force all believe in the principle of promotion and the law as it stands may have the result of preventing promotion.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Abolition of estate duties on agricultural land.)
  From the date of the passing of this Act, estate duty shall not be levied on any land used for the purposes of agriculture.— [Mr. Colegate.]
  Mr. Colegate: I beg to move, "That the Clause be read a Second time."
  This Clause deals with a fundamental matter affecting long-term agricultural policy, on which I venture to urge that it is the duty of the Government to take a decision as soon as possible. The whole atmosphere surrounding this question has been greatly changed during the past few months by a remarkable series of reports which show great unanimity on certain points. In addition to that, there has been a change of attitude towards agriculture in many quarters, quarters which have not in the past been regarded as particularly favourable to agriculture. I refer to reports issued by the Federation of British Industries, the London Chamber of Commerce, the National Union of Manufacturers and, perhaps the most striking of all, the Wholesale Textile Association, who are quite emphatic in their recommendation that the restoration of British agriculture is essential to the future prosperity of the country. Those reports show the essential place that British agriculture must hold in the economy of the country.
  Next I come to the expert reports, which tell us what is one of the main

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  features which will ensure the restoration of British agriculture to its rightful place in the economy of the country. I refer to the reports of the Royal Society of Agriculture of England, an expert body; to the Central Landowners' Association, an interested body who are entitled to have their views heard; to the sub-committee of the Conservative Reconstruction Committee, who have issued a remarkable report which has received favourable notice in every quarter; to the National Farmers' Union, which is very closely in touch with the whole situation; to another very remarkable report, signed by a group of peers of all political parties; and then to the Forestry Societies, the Royal English and the Royal Scottish; and lastly, but not least, in fact to the most remarkable report of all, the Scott Report, which, I gather from references made to it in this House, is accepted by almost everyone concerned.
  Let me take first the report of the Central Landowners' Association. It is a very good report, and I advise everyone to read it. They say that it has already been pointed out that the incidence of Death Duties is the most competent cause of the break-up of agricultural estates, and they go on to say:
  "No more effective method of eliminating such estates could have been conceived. If it is accepted by the Government that the remaining agricultural estates should be retained then it follows that such a result can only be achieved by the remission of those duties where land is scheduled for the production of foodstuffs and timber."
  When we are asking for the remission of Estate Duties on agricultural land, we understand that proper Regulations should be made to see that that land is only freed from Death Duties while it is used for agricultural purposes.
  Now take the Conservative post-war reconstruction report, one of the best upon agriculture that has been produced for many years. It comes up against this difficulty almost at once. It says:
  "The most difficult to defend from an agricultural standpoint is Estate Duty. It is capricious and uncertain in its incidence. The accidents of life and death may give to one estate comparative immunity, while another feels its effects with crushing severity. In the absence of outside resources it can seldom be met without the break-up to a greater or lesser extent of the estate which is called upon to pay it. Again, under existing tax procedure the rate of tax will increase with the
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  size of the estate and with the total wealth of the owner, a position which may be just from the standpoint of the taxpayer, but which bears no relation to agricultural needs. Psychologically it is disastrous. The guiding motive of the best type of owner is regard for the permanent welfare of his estate."
  I do not think that would be denied by anyone who has any knowledge of the conditions of the agricultural industry. The report goes on:
  "To such a man the knowledge that, on his death, taxation will destroy his life's work, cannot but have a most depressing effect. The evil effects of the Duties are not confined to the great estate. Equally onerous are the smaller sums demanded from the owner-occupier. To find them involves an inroad on working capital, which almost invariably impairs the future efficiency of the farm as a productive unit."
  I come now to the report of the Royal Agricultural Society of England, a body composed of nothing but experts, and they make a very brief reference to the matter. They simply say:
  "One of the prime causes of deterioration of the countryside and the loss of fertility has been the incidence of Death Duties. It is impossible to withdraw from the land, at frequent and irregular intervals, large sums of capital without exhausting its power of reproduction which is vital to the nation."
  I will quote just a sentence from the report of the National Farmers' Union. Farmers by no means see eye to eye with landowners on every question, and their evidence is really of great value. They say that before the war they had, in collaboration with the C.L.A., made representations to the Chancellor of the Exchequer with regard to the incidence of Death Duties on Agricultural land and the need for relief for expenditure for the maintenance and development of agricultural production. They go on:
  "The force of these representations has been intensified by war-time conditions and action in response to them should be an essential feature of the Government's long-term plans for the industry."
  I come to the report of the Peers, who include one Socialist ex-Minister of Agriculture. They were quite emphatic. They said:
  "Death duties in their present form as applied to the owner of agricultural land are incompatible with the proper maintenance of that land. The maintenance of the present system of landlord and tenant (which leaves the tenant's capital free for working the farm) depends primarily on such relief from death duties as would arrest the drain on the landlord's capital, which should be at disposal for the maintenance and improvement of the fixed equipment."

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  I will not refer to the Forestry Societies' reports, which are equally emphatic, but will go on to the Scott Report. This matter was not within the Scott Committee's terms of reference, and therefore the Report did not make recommendations. When the Committee turned to the subject of rural amenities and the position of agricultural land in England however, almost the first thing, in the first few pages, upon which they were compelled to comment was the incidence of Death Duties. This body was not concerned with landowners at all. Their terms of reference concerned the future of agriculture and rural England. The Report says:
  "During the years before the war of 1914–18, as well as since, rising taxation and the incidence of death duties seriously reduced the ability of many landowners to make necessary improvements or to maintain their farms in good tenantable condition. Many estates became heavily mortgaged. To retain their farms many tenants bought them, often at high prices and frequently with borrowed money. This lock-up of capital in the land meant less money for working capital and became for many owner-farmers a source of considerable embarrassment when later the general world depression in agriculture brought low prices."
  That is very remarkable testimony from the Scott Report.
  Never has there been such unanimous testimony from widely differing interests and from such expert committees, such universal condemnation of the evil effect of Death Duties on agriculture, which is one of the major industries of this country. I would remind the Committee of the very wide difference there is between the incidence of Death Duties upon a money fortune and upon agricultural estates. If anyone leaves a large sum of money in a bank, the heir may very much regret that he has to draw a very large cheque in favour of the Chancellor of the Exchequer, but there is no difficulty about it. Unless that money forms the working capital of a business, or part of it, no harm is done to production. No business or estate is damaged. If you leave a large holding of shares in some company, some may have to be sold to pay the Death Duties, but that does not affect the company by a single farthing. If you are lucky enough to inherit some shares of the Imperial Tobacco Company, the money for the Death Duties is not provided from either the working capital or the fixed capital of the company but
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  is provided by other members of the public, who purchase the shares.
  Take the case of a man inheriting an agricultural estate. If he has not large outside resources, he must break up the estate, and that does no good to agriculture whatever. On the contrary, it does an enormous amount of harm. He may exercise the option, which the Treasury give him, of paying over a series of years. That is no help to the question from the angle from which I regard it, namely, the prosperity of British agriculture, because what does it mean? It means, because the net income is not high compared with capital value, that over a series of years the heir is short of money and is inevitably tempted to starve the estate, cut down on the repairs, and generally do little draining, etc., and thus seriously impair the fertility of the land. Whatever means he adopts he has to do one of two things, eat either into his fixed capital by disposing of part of the estate, or into his working capital by withdrawing money from it.
  This question, I know, has been raised many times before, but, I would remind the Committee, never in the circumstances in which it can be raised to-day. This is the first opportunity, this is the first Finance Bill, on which we have the right to press upon the notice of my right hon. Friend the cumulative effect of these expert reports which I have quoted. The question has been raised before, and I just want to refer to that, because it has a considerable bearing upon the decision which I think the Chancellor ought now to take. In passing, I may say that the venerable and illustrious author of those duties, the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) said—[Interruption.] Ah, yes, but they were not on the scale which we know, and which affect agriculture. I am refer, ring to the time from 1909 and 1910. The author of these increased duties, I should have said, has said that agriculture is too heavily taxed. No one could fail to see, including the right hon. Gentleman, that these Estate Duties were heavy and had an extremely harmful effect. This was brought out very clearly in the Budget Debates of 1925. I may remind the Committee that the Chancellor of the Exchequer of that day was my right hon. Friend the present Prime Minister. The Death Duties were increased, but as a result of

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  debate, as a result of the evidence then brought of the damage being done, a concession was made, and the Death Duties on agricultural land were not increased in the 1925 Budget. From that day to this there has been no increase. Every succeeding Chancellor of the Exchequer has had to maintain this differential rate for Death Duties on property and on agricultural property. I think I am right in saying that the scale to-day is the old scale under the Finance Act, 1919. Nobody has dared to change it, although the rates have been put up on every other form of property, because it has been recognised by Chancellors of all parties that the Death Duties were doing an extremely large amount of damage to the agricultural industry of this country.
  The total amount raised by these duties is not large. Taking it in general, I think I am right in saying it has never been higher than £4,000,000 in recent years, and I think it has frequently ranged between £1,000,000 and £2,000,000 a year. That is not a very serious amount in a Budget of the £1,000,000,000 mark. I am not going to translate it into terms of battleships or bancors. I prefer to deal with the old-fashioned pounds, shillings and pence. Nor will I refer to destroyers. It must be realised that although the total amount is not large, seen as an item in the national revenue, the effect on individual owners is crushing, because this is not a tax of £2,000,000 or £3,000,000 or £4,000,000 levied over the whole of the agricultural estates of the country. It depends entirely upon the chances of death. Some estates, large estates, having landlords capable of keeping those estates in first-class repair, may go on for years without paying a farthing towards this levy, whereas a neighbouring estate may have to pay these duties in respect of two deaths in a very short period of time. Anyone who has seen, as I have, the effect on an estate of two deaths in a short period, will know it is disastrous, not only to the man who inherits, but to the tenants and to the people in the villages concerned.
  I have dealt with that point. It may be said, "You have pointed out the evil and damage that this tax does. Surely someone must benefit?" I entirely agree; someone does benefit—two groups, indeed three. Two great groups benefit, mainly.
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  They are the jerry builders and the land speculators. These duties are the charter of the land speculator and the jerry builder. I take an estate within my own knowledge, within a few miles of my own home. I passed through it recently. There was a beautiful house, there were wonderful woods. The people could not stand up to the effect of the Estate Duties. They threw in their hand altogether. A land speculator bought the whole thing, lock, stock and barrel. Pass that place to-day—windows empty, woods cut down, everything disposed of, men who have been employed in the neigh-hood discharged. What more would have happened if a foreign enemy had taken that place? Hitler, in his attacks on England, made a threat. He said, "I am going to destroy every country house which is starred in Baedeker." It was quite unnecessary. The Treasury are going to destroy the houses and contents of every house starred in Baedeker. They are doing it. When I was in America some time ago I noticed near the shores of Lake St. Clair, near Detroit, two Elizabethan houses, which had been sold in this country, taken down and re-erected there stone by stone, brick by brick. It was a horrible sight to me. They looked forlorn. I say, "Why should Britain sell its birthright and heritage in this way?"
  At the risk of wearying the Committee I must, having dealt with the primary effects, just deal with the secondary effects of this iniquitous tax. You will see in the "Daily Mail" to-day the headline "America buys the family treasures." How true that is. How true it has been ever since these Death Duties have been in operation. The fact is that anything of high excellence in the way of furniture, pictures, books and manuscripts is one of the commonest forms of raising Death Duties at the present time. Many owners of estates feel that, to use an old-fashioned phrase, they have to do their duty to the land. They try to maintain the estate for their children, for the workpeople, and for all concerned. Therefore, their tendency is to look around, and to say, "What about the pictures; what about the other old treasures? We are offered so much for them." That is going on on a large scale, which I am sure a number of people in this country have not recognised. I am not looking now at the international art collections; I am talking of our native indigenous

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  genius, the Romneys, the Raeburns, and others that you will find in the country houses of England. I am not talking about Matisses and that sort of thing, but of the native arts of England, the furniture made by Englishmen for Englishmen, the portraits painted by Englishmen of Englishmen—and by Scots, too; take the wonderful Raeburns that you can find about the country to-day; or that you could find once. Take the simple case of the Shakespeare folios. In many country houses there was an old Bible and a first folio of Shakespeare. I am well within the facts when I say that 95 per cent. of these folios are in the libraries of America. If you want to pursue Shakespearean bibliographical research to-day, you have to go to America to do it.
  Is it wise to let your heritage go like this? This land and all its treasures of architecture, art, furniture, books, manuscripts, and what you like, have been handed down not for our own personal disposition, as many people think, but in trust for those who come after us. One of the questions we must ask about any statesmanship and any taxation is, what is the physical result? Is the land better, and are there more good houses large and small, or has the land degenerated, and have the houses gone out of repair; are the people living on their capital? An American said to me, "We Americans are the residuary legatees of the whole of English art." It is perfectly true. They have already got a large quantity of it. I press this matter most strongly on the Chancellor.
  I have spoken at length, and I will sum up my argument very briefly. First, I have demonstrated that all expert opinion agrees that the effect of Death Duties is disastrous to the capital structure of agriculture. Is there anyone who denies that? Secondly, I have shown that all reports dealing with this subject, from whatever quarter they come, recommend the immediate abolition of these Death Duties. Thirdly, I have shown that the secondary effect of these Death Duties, namely, the putting of the whole of the country houses of England in pawn, is a disastrous step, and that it should be stopped at once. Lastly, the total amount of money accruing to the Treasury is not great. Had I more time I could have shown that it is very doubtful whether there is any net gain to the Exchequer,
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  because, as a result of this exhaustion of capital, it has been necessary to pay subsidies for drainage and other purposes which might have been avoided had a more statesmanlike course been followed. This enormous damage is, I think, more important than any question of mere pounds, shillings and pence. It Is our heritage that we are selling lightly. We must not do it. I appeal to my right hon. Friend to see whether he cannot accept this Clause, and, if he cannot, to promise us such consideration that we may hope that the new long-term agricultural policy of England is going to be based on a system of taxation which will not exhaust the fixed capital of that industry.
  Sir K. Wood: I would like to congratulate my hon. Friend on a very fine effort, and a very persuasive one. He will not expect me, however, to make an announcement on this matter to-day. As he said, the reports which he has quoted are under the consideration of the Government, and they are one of the matters which will have to be considered in connection with the Government's policy on agriculture. This, I think, will be some comfort to him. His speech will be available to my colleagues and myself when we consider this question, and I can assure him that we shall give it the greatest consideration.
  Mr. Douglas: There is not a single argument which can be brought forward in favour of this proposal which cannot be brought forward for reducing the Death Duties on many other kinds of property. If it is true that they injure the interests of agriculture, it is equally true that they injure the interests of other industries. The hon. Member has attempted to escape from that dilemma by saying that in the case of industry ownership is very often vested in shareholders, who can sell their shares without affecting the actual control and conduct of the undertaking; but that applies in the case of agricultural estates. Every one of us knows that scores upon scores of agricultural estates have been turned by their owners into limited liability companies, to deal with this very problem. It is open to them to continue that process as far as they please. In that way the continuity of the company's ownership can be maintained, and the problem of raising the money can be dealt

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  with by disposing of the shares, in precisely the same fashion as owners of shares in an industrial undertaking deal with the problem of paying Death Duties. In fact, there is no other object in this country which is dealt with so tenderly, so far as Death Duties are concerned, as is agricultural land, which is taxed upon a lower rate than other property, and on which the owner has an option, which is not given to any other payer of Death Duties, to pay the amount of the taxation by instalments spread over a number of years.
  It is said that this taxation is a burden upon agriculture—a burden, that is, upon the industry on farming—but there is no proposal from the hon. Member to exempt from the burden of Death Duties the stock-in-trade of the tenant farmer, by which he carries on the actual operation of farming. It is only a proposal for exempting the owner of land from Death Duties upon the land. Let us not forget that the land is made up of two elements. There is the land itself, and there are the buildings and the other improvements which have been made to it. If there was a proposal to distinguish between those two things in order to encourage the provision of improvements, quite a good case could be made out. The Scott Report, to which reference has been made, contains a series of proposals that there should be a fresh system of valuation which would make that distinction between the land itself and the buildings and improvements which are placed upon it. If such a distinction were made, there would be an opportunity, not only in this case, but in other cases, to make a distinction between the actual contribution to production and the ownership of a natural resource which has not been created by anybody.
  Let us assume for the sake of argument that Death Duties on agricultural land do to some extent fall upon persons who are actually conducting the business of farming. It is not a serious burden placed upon that industry. The amount in question is comparatively small. For the past 20 or 25 years the amount of Death Duties collected in respect of agricultural land has fallen to about half what it was. The amount now collected, something over £1,000,000—and I speak from memory—is only a very small part of the agricultural output of this country, which is well over
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  £250,000,000. Therefore, this amount is of the order of much less than 1 per cent. of the agricultural output of the country. It is useless to suggest that the condition of agriculture is seriously influenced by the effects of this taxation. Reference has been made to the break-up of great estates, and something may be said for that in some cases, unless we are all prepared to stand by a system in which the ownership of the land of this country is concentrated in the hands of a comparatively few individuals. I question from the very foundation the soundness of an argument of that kind unless we believe in a state of society in which there is a great gulf fixed between those who have large possessions and the mass of the people of the country.
  I sympathise with those who wish to preserve many beauties which have come down to us from the past, but the dispersal of these artistic treasures is not due to the incidence of Death Duties upon agricultural land. It had started long before the Death Duties on agricultural land came into existence and before they had attained any significance whatever. The Huntingdon Library in California, to which the hon. Member referred, has one of the most marvellous collections of ancient documents. The Battle Abbey deeds were sold by the owner of the land more than 100 years ago, before any question of Death Duties came into consideration at all. If owners of land desire to preserve these things for the benefit not of themselves, but of the nation at large which has contributed out of the rents which it paid to the owners of agricultural land, there are means open for them to do so. They can hand over their property to the National Trust in order that it shall be preserved for the benefit of every one of us. There is no reason why those who feel patriotic in this matter should allow artistic treasures of that kind to be dispersed. I hope that the proposal which has been made will be looked at from all its aspects—from its economic aspect and from the other aspects which have been mentioned—and in the light of the fact that every proposal of this kind means that more taxation has to be placed upon somebody else in order to improve the conditions of those whom it is hoped to benefit.
  Major York: I would not have risen had it not been for the speech to which we have just listened, but I feel that

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  there is a fundamental misunderstanding on this problem. It is looked upon by hon. Gentlemen opposite as a problem of ownership. It is nothing of the kind. It is a problem of management. If we can only realise that the management of an agricultural estate is just as important to the agricultural industry as the management and physical use of the land itself, we might get a better and a truer realisation of the proper function of the landowner. The hon. Gentleman referred in particular to estate companies and the shares which could be sold in the same way as industrial shares. I ask the hon. Gentleman to disabuse his mind of the fact that the shares of estate companies, if they are sold, do not have any effect whatever upon the management of that estate. They have just as direct an effect on that estate as if the company had not been formed. I myself am a land agent, and I have entered into many negotiations on the subject of the formation of estate companies, and I have never been able to see any advantage in that form of alteration. But a lot of people have done so, I agree. It does not affect in any way the unfortunate incidence of Death Duties so far as the capital in the estate is concerned. If shares have to be sold, then land has to be sold in order to realise the shares.
  Another point that the hon. Member made, that there should be along with this suggestion an alleviation of burdens on the farmer's stock, is entirely a different one. if a farmer has to pay the duties, he first of all pays on a very much lower capital value, and consequently his stock is far more realisable than that of the landowner. The real point is that, in my experience, it is almost invariably the large estate in a ring-fence which is efficient, both economically and technically. It is a large estate which has all the advantages of a central workshop, a central maintenance unit and a central executive management. Wherever that ring is broken and the estate is reduced in size you get inefficiencies creeping in. The effect of Death Duties is that in almost every case the farm or farms on the outskirts of the estate are first sold off. Each of those farms goes to probably one owner, or perhaps one man buys all of them. Almost invariably he buys for investment what will give him 5 per cent. on his money. That is one principle that
  474
  has done more damage to the agricultural industry than anything else.
  It is this desire on the part of men and women who have no feelings for the land at all and who regard money put into agriculture in the same way as money put into investments that is ruining the industry. These people have no idea how to manage land as it should be managed, with the result that there is an increase in the number of speculative builders and investors. Hon. Members who live in the north of England know that some years ago there was an organisation called "The Forty Thieves," who used to go around buying up the estates of large owners who could no longer afford to run them, break them and sell bits here and bits there to speculative builders, bungalow proprietors or roadside garage proprietors. So, slowly and inexorably our countryside was wrecked and ruined. I hope the Chancellor will consider favourably the suggestion so eloquently put forward by my hon. Friend in this Clause. I ask him to remember that we have one prime national asset in this country—the land. Practically everything else is artificial and man-made, but the land will remain, and everything we can do now and in the future to improve it and to make landowners more efficient and more sensible of their responsibilities is all to the good of the country.
  Mr. Boothby: I would not have risen had it not been for the fear that some confusion may have arisen. The speech of my hon. and gallant Friend the Member for Ripon (Major York) may have led some people to suppose that he was strongly against small ownership or even-medium-sized owner-occupiers of land. I am sure that is not the impression he wished to give.
  Major York: No.
  Mr. Boothby: There has been a spread of owner-occupiership in Scotland for the last five years, with very satisfactory results. Both the Mover and the Seconder of the new Clause seemed to suggest that the only way land can be farmed was solely through large estates.
  Major York: I am glad my hon. Friend has allowed me to correct the impression which he suggests I gave. My hon. Friend who moved the Clause did refer to owner-occupiers' capital being taken up.
  Mr. Boothby: The hon. Member for North Battersea (Mr. Douglas) also seemed to confuse the Clause with the method of valuing land. He mentioned the Scott Report. I do not think that was in the mind of my hon. Friend who moved the Clause. I am satisfied that as a result of the Scott Report there will have to be a different method of valuing improvements to the land, but that is not directly affected by the Clause under consideration. It would be a pity to confuse the two issues, because it might be thought that anybody advocating the abolition of Estate Duties on land was opposed to any change in the method of valuing the land, particularly any method of valuing improvements to the land. That is not the case at all. The argument which can be adduced in favour of this Clause is that this duty is an arbitrary tax that may fall at any moment with crushing effect on a particular estate, which may, for the time being, be knocked out. There may be two or three deaths in rapid succession, with the result that there is no capital for development for perhaps 20 or 30 years. I do not think we can continue indefinitely under this system. As has been said, Death Duties falling in that way are a gift from on high to the land speculator as such, not to the farmer who wants to buy his own farm, but to the man who wants to break up an estate and sell it to a jerry-builder for the sole purpose of making as much money as can be made in the shortest possible time, thus doing irreparable damage to the countryside.
  Nobody can doubt that there is need for capital in agriculture. The sum involved is trivial in relation to the results which could be achieved; as against the subsidies which have now to be poured out for land drainage and almost everything else, the cost to the Exchequer might be trivial. I am convinced that there are in the long run only two alternatives confronting this country—the remission of Estate Duty on agricultural land as such, and the nationalisation of the land. I do not see any other way of getting the necessary capital into the land of this country. That is an issue which may have to be fought out in the years which lie ahead, but that something must be done now I have not the slightest doubt.
  Mr. David Adams: Nothing astonishes me more than the boldness of
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  a certain section of Members. of this House and we have had an admirable illustration of that to-day from the hon. Member who moved this Clause. At a time when the Chancellor is raising considerable sums of money from the poorest classes of the community, against which many in this House have dissented, we have this privileged section in the matter of monetary standing coming here and asking for a remission of taxation on agricultural land. I suppose it is evidence of the buccaneering spirit that has been utilised in industry with very good effect in certain spheres, but to request that the most prosperous industry in the country to-day should be relieved of any part of its proper taxation is astonishing. The hon. Member who moved the Clause was careful to blend together landowners and agriculturists, and I am quite agreeable to that, but the quotations he gave were very prejudiced. It was significant that he did not seek to put the position of agriculture as it is to-day—prosperous, fortunate and well-favoured by the community and the State——
  Mr. Boothby: After 20 years' depression.
  Mr. Adams: That may well be the case, but surely we cannot argue from the position as it was 20 years ago.
  The Deputy-Chairman (Mr. Charles Williams): If we did, I think we should be going very far beyond the Clause. I would ask Members, as the Chancellor of the Exchequer said he would go into this from another angle, whether it might not be well to get on with the Bill.
  Mr. Levy: On a point of Order. Is an hon. Member precluded from referring to something which may appear prima facie irrelevant but, nevertheless, is absolutely relevant in the development of an argument? If that is to be ruled out, the Debate will be stultified.
  The Deputy-Chairman: I do not think I ever ruled that at all. My suggestion was that we seemed about to go a long way down a side line, which might entirely stultify the Debate and bring it outside this Clause, which is not very wide.
  Mr. Adams: I have no desire to digress but it seems strictly logical that, if it is

  477
  desired to relieve agricultural land, and most other land, some argument should be evolved for the purpose. If agriculture and agricultural land are in a depressed state, the depression extends to other forms of land, but we have had no such suggestion made. The fact is that taxation, generally, is being distributed with a very heavy hand upon all sections of the community, and the layman would assert that there is one section of the community, namely the agricultural, which ought to feel this tax least of all. They have been the favourites of fate and of Parliament, not only of this Government but of previous Governments. Vast sums have been conceded to agriculture as free gifts. These were grants not from high Heaven but from other taxpayers. We have had controlled prices, guaranteeing to agriculture certain specific profits, which the State has not guaranteed to any other section of the community. We have given the free use of implements, lime, fertilisers, and the remission of local rates.
  Mr. Colegate: We are not asking for the remission of Income Tax and Super-tax. We are talking of capital taxes—Death Duties.
  Mr. Adams: I am not aware that I mentioned the remission of Income Tax or Super-tax. I am stating that there are these remissions of local rating and differential duties. The working classes, though they may not have many exponents here at the moment, are feeling the same burden of which agriculture is improperly complaining, and no evidence has been submitted to indicate the reasonableness of further remissions for agriculture, which is one of the most prosperous sections of industry. Industrial workers suffer not only through direct and indirect taxation but, in addition, have the burden of unemployment, which is perhaps the heaviest of all. We are promised that that will cease to fall upon them but we have to live and see whether that will be so under the capitalist system. If we indulge in the luxury of great wars in rapid succession, can we expect that these will be paid for, without the levelling down of those who have been in a privileged position in the past? We can only hope that the levelling process may not be too rapid, or indeed that there will be a levelling up rather than a levelling down. The proposals of the Clause would place an
  478
  additional burden upon the rest of the community in the interest of agricultural landlords.
  Mr. Quintin Hogg: I rise to make an appeal which I hope may have some effect on the party opposite. I quite understand how the Clause cuts across a good many of their pre-conceived ideas. Since I have been in the House I have often learned a very great deal from their practical experience in certain matters and have changed my preconceived ideas. I trust that they will look at this matter without prejudice and see that there is more in the argument of supporters of the Clause than perhaps they thought. The last speaker treated this as a case of remission of taxation. It seems to me that that is a total mistake. At the present rate, taxation is not simply a question of raising revenue. It is a great instrument of policy, and our case is that this instrument of policy is unfairly affecting one of the great industries of the country. It Is true that, so far as immediate profit is concerned, so far even as capital in the sense of working capital is concerned, agriculture is, for the moment, prosperous, but our case is that the heavy, long-term capital industry is not prosperous, and the reason is the incidence of Estate Duty.
  The hon. Member for North Battersea (Mr. Douglas) suggested that there was no single argument that could be applied to agricultural land which could not equally be applied to other forms of land ownership, but that ignores the real character of the capital structure of the agricultural industry. I can cite a case where the owner of a great estate and the owner's son died within a week. Next door there is an estate owned by a college. It has plenty of capital, because a college never dies, while the estate owned by the landowner has been starved of capital, because it has paid double Death Duties. As matters stand at the moment, the capital structure of agriculture demands money from the pocket of the landowner in a sense that other forms of industry and capital investment do not. Whether that is desirable or not I do not propose to inquire, but it is the fact.
  It is said by hon. Members opposite that they do not approve of that form of society and that they do not want a dif-

  479
  ferential form of society in which great landed estates exist in private hands. I am not at this moment arguing against that point of view. I do not say that I support it, although I have greater sympathy with it than hon. Members opposite think. What I say is that this Finance Bill is not an instrument for upsetting the social structure of the country or fundamentally altering it, and what cannot be justified is retaining the present social structure and preventing it from working efficiently. If you want to alter it, alter it by a proper Measure which will restore a proper balance in another way, but do not keep it on in such a form that it cannot operate efficiently. I therefore ask hon. Members, whatever their views, to regard a new Clause of this kind sympathetically, because it is conceived on the basis of the existing structure of society. The arguments against it are based on a misunderstanding of the capital structure of this industry.
  One hon. Member suggested that landowners should hand over their property to the National Trust. The National Trust is not designed as a manager of agricultural land. It may have to undertake work of that kind from time to time in the course of its business, but it is not an instrument designed to take over agricultural land. It is not fair, while we have a system of private property, to turn to one particular class of property owner and say, "We are going to allow people who have their money in shares to continue as private owners, but because you own agricultural land you must give up everything you have." Therefore, I ask hon. Members, without prejudice to their general convictions, which I am not disputing at the moment, to give the new Clause the sympathetic consideration it deserves.
  Mr. Woodburn: I say, frankly, that there is a certain amount of tragedy in the break-up of great estates, but I see a fallacy in arguing that the cure for that is necessarily this proposed Clause. This is a question of national planning and public policy in another direction altogether. I am sure that the Chancellor during the proceedings on this Finance Bill must have been surprised at the number of innocent, helpful people whom he has been punishing and penalising by his
  480
  taxation. According to one of the arguments used every great landowner has been a benefactor who has held the land together and it has only been the wicked speculators who have broken it up. I know a number of cases in which the reverse has happened, in which the great landowner himself has taken advantage of every development of the community and exploited it by ribbon development and by selling his land to house speculators and making the most out of it. I suggest that he is not in the same category as people who are making profits in other directions.
  Mr. Colegate: It was never suggested that he was.
  Mr. Woodburn: The suggestion was that the landowner was a person of great generous public spirit, but we have to take landowners as a mixed variety—the speculators, the gamblers and all the other people mixed up in the community of landowners.
  Mr. Colegate: The hon. Member has missed the point altogether. I was not talking for the great landowners but for all landowners, most of whom are small men. The imposition of Death Duties gives the opportunity to the jerry-builder and the land speculator. There are landowners who speculate, but they are driven to speculation by the Death Duties.
  Mr. Woodburn: Surely there are other ways of sharing out the land than by selling it to speculators. Somebody has referred to the formation of a company. There is no reason why a landowner should not form a company and sell shares in it and still keep control of the land. If there is a profit, he can distribute the profit instead of the land. We have to realise that land is a big capital institution. If it is a question of perpetuating the control by one individual of hundreds of thousands of acres and to some extent the destinies of people upon that land, that is a position that has to be considered, but it is not a question of Death Duties. The Government and the people as a whole have no right to subsidise that system at the expense of people less able to bear the burden. So far as I can understand the system of taxation and Death Duties in this country, it is as fair as anything that can be devised. It is for the person who has land to make

  481
  such arrangements that he can meet his obligations to the community in the proper way. It may be that if two or three deaths take place in rapid succession hardship arises, but hardship arises too in regard to a soldier's estate, if both father and son are killed in the war.
  Mr. Hogg: The point is not the hardship to the individual but the damage to agriculture.
  Mr. Woodburn: The point surely is not the question of relieving a person of a financial obligation but a question of the Chancellor and the Government introducing some arrangement by which if the Death Duties involve the sale of land in a way which will harm the country, some arrangement should be made by which the Government could be able to take over the land. We have an instrument in the county agricultural committees, and I see no reason why they should not take the place of the National Trust so that if a person cannot finance the payment of his Death Duties, the community as a whole, through the Chancellor, should be able to take over the land in trust under the management of the county agricultural committees. This would solve the problem of the breaking-up of estates and ensure good management. There is no guarantee that a landlord is a good manager of land. There may be landlords who are good managers but there are also bad ones. During this war the community has had to see that the land is properly managed by taking it out of the hands of many landlords. The question of efficiency is not guaranteed by the individual ownership of land. I agree that we ought to have efficient management of the land, but it must be guaranteed by public policy and run by the public and not left to private individuals who may or may not be efficient.
  Sir K. Wood: May I appeal to my hon. Friends to proceed with the Bill? We have had a useful discussion on this matter but I am anxious to have adequate time for the consideration of the remaining new Clauses. This has been a general discussion and I think that the observations I made were generally satisfactory to my hon. Friends. In these circumstances, I would ask them to allow us to proceed.
  Mr. Colegate: May I just say two sentences with regard to two points that have been made?
  The Deputy-Chairman: The Chancellor has made an appeal to hon. Members to end the Debate, and it is only fair to other Members who are giving way that the hon. Gentleman should not continue to make points which have already been made several times. I appeal to him to take the wider view and let the Debate end.
  Mr. Colegate: I was not going on to argue but only to correct a statement. In view, however, of your appeal, Mr. Williams, and in view of the satisfactory statement made by the Chancellor, I beg to ask leave to withdraw the Clause.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Standard Profits where there were no profits in standard Period or profits in that period were low.)
  "The references in Sub-sections (5) and (6) of Section twenty-seven of the Finance Act, 1940, to 6 per cent. shall be amended to 8 per cent., and the references to 8 per cent. shall he amended to 10 per cent. This Section applies to any direction of the Commissioners in respect of the standard profits of a trade or business for any chargeable accounting period ending after the end of March, nineteen hundred and forty, subject, however, as respects any such chargeable accounting period which begins before the said end of March to the provisions of Section thirty-three of the Finance Act, 1941."—[Mr. Colegate.]
  Brought up, and read the First time.
  Mr. Colegate: I beg to move, "That the Clause be read a Second time."
  This new Clause deals with a comparatively small question and concerns almost entirely small businesses. At the present time a small business which had no income during the standard period is limited to earning 6 per cent. on its capital, and on new capital which is raised it is allowed 8 per cent. I am not going into this subject in any detail, but I ask the Chancellor whether he cannot increase the 6 per cent. to 8 per cent. and the 8 per cent. to 10 per cent. The businesses concerned are mostly small businesses which underwent difficult experiences or else were in a period of development. Many of them are paying out in taxation more than the total amount of the income left, because they are only allowed 6 per cent., which is 3 per cent. after payment of Income Tax, and they are not allowed to deduct for Income Tax purposes their

  483
  war damage premiums and certain other payments. The result is that there are actual instances of businesses, almost entirely very small businesses, where the 6 per cent. does involve the company, after the payment of tax, in an annual loss.
  Sir K. Wood: I regret that I cannot advise the Committee to accept this Clause. At this stage I cannot, I am afraid, increase these allowances. I should be in further difficulty if I did so in this case, because if the rate were increased to 10 per cent: the capital of the company would be treated in the same way as new capital, for which at present we are allowing 10 per cent. There was a special reason for that, and that was to encourage capital coming into a business, but if I were to accept this Clause the next thing would be that some of my hon. Friends would come along and say, "We want another 2 per cent. for the new capital," and I should then get to the question of having to allow 12 per cent. I hope the hon. Member will appreciate my difficulties, but I really cannot take this matter further.
  Sir A. Gridley: I really do not think the Chancellor can expect us to be satisfied with the explanation he has given. I am sure that he does not want injustice to be done, as it is being done at present, to many industrial undertakings, and not only small ones. There are many firms who are in the fortunate position of having had during the standard years very satisfactory profits, which enabled them to pay in pre-war years 10, 15 or 20 per cent. dividends, and it is quite easy for them in the war years to continue to pay such dividends; but there are other concerns which were in the stage of development or were going through a period of depression in the pre-war years and had no profits at all. Their standard was so low that in present circumstances they are contributing immeasurably to the national effort and yet getting less than nothing for doing so. It would be quite easy for the Commissioners of Inland Revenue to bring before the Chancellor convincing facts showing the gross unfairness of the present system towards this type of undertaking. I doubt very much whether, when it was originally suggested that 6 per cent. or 8 per cent. should be a reasonable return on the capital, it was
  484
  ever expected that we should reach an Income Tax of los. in the pound. If a company makes 6 per cent., the Income Tax reduces it to 3 per cent., and after you have to take out of the small residue the compulsory contributions towards war damage and pay what may be quite a reasonably small reward to the directors of the company, who may be whole-time directors. What inducement is there to such a concern, apart from the impelling motive of doing what they can for the national effort, to expand their business when they will get absolutely no reward?
  Further than that, capital has been found by private holders of capital for the development of these businesses at a time when they will receive only this puny reward, and they have no idea whether that capital itself will not be lost or will depreciate considerably after the war when the type of business now being carried on may no longer be required or there may be only half the present volume of work. If the Chancellor wants to do justice all round, he ought to take this special case into consideration. All we are asking for is recognition to the extent of a miserable per cent. It does not sound very much, but it does make a difference whether you get 3 or 3½ or 4 per cent. on your money. In view of the moderation of the demand behind the Clause, I ask the Chancellor whether he will not soften his heart instead of keeping it quite so hard.
  Question, "That the Clause be read a Second time," put, and negatived.

  NEW CLAUSE.—(Expenses deductible from earnings of Women's Land Army.)
  Rule 9 of Schedule E of the Income Tax Act, 1918, shall apply to the assessment of the earnings of the Women's Land Army, and the amount expended by a member of the Women's Land Army on her board and lodging at or in connection with her place of employment may be deducted from the earnings to be assessed.—[Mr. Brooke.]
  Brought up, and read the First time.
  Mr. Brooke: I beg to move, "That the Clause be read a Second time."
  My hon. Friend the Member for Thirsk and Malton (Mr. Turton), in whose name this new Clause stands on the Paper, has asked me to apologise to the Committee for his inability to be present at the time when it has come on. The Clause deals with the emoluments of the Women's Land

  485
  Army and calls attention to an anomaly which is apparent there as elsewhere. I will state it in general terms. A girl in the Women's Land Army may live oh a farm, in which case she will receive board and lodging from her employer and a salary in addition. Alternatively she may live out, in which case her money emoluments will be increased because she will receive a board and lodging allowance. Under the Income Tax Acts, if a person receives free board and lodging as part of his or her emoluments, no tax is chargeable on that part of the income which is income in kind, but if the same person, instead of living at her place of work, lives elsewhere and receives an additional allowance to cover the extra cost of her board and lodging that allowance, though it is to meet a quite definite expenditure, becomes taxable. I think the Chancellor will agree with me that not only in this case but in many other cases, the Income Tax law is operating inequitably between one person and another, in the sense that it is discriminating against those who receive board and lodging allowance. If board and lodging allowance were paid direct to a hostel where a woman lived, then that sum might not be included for tax purposes on the ground that it does not at any time pass through the taxpayer's hands.
  There is another anomaly apparent in the difference between the treatment of the Women's Land Army and the treatment of the women's Services. I know that the Women's Land Army are civilians and the girls in the A.T.S., the W.A.A.F. and the W.R.N.S. are not. The Government use that argument to justify differentiation of treatment between them. But I do not think any of us are quite happy about this matter, and it is because my hon. Friend has had hard cases brought to his attention—and so have I, in another sphere—that we ask the Chancellor what he intends to do to remove the discrimination.
  The Attorney-General: There is undoubtedly, and there has been for some time, an anomaly—if that is the right word—arising from the fact that if a person gets board or board and lodging, as part of the consideration for work, it is not evaluated in money and taxed as income. The first case that came before the court was that of a bank manager for whom accommodation was provided in
  486
  the bank. That fact was reflected in his salary. As between him and, say the headmaster of a grammar school living next door, one might have said that that was unfair and you would have upgraded the bank manager rather than scaled the other man down. Undoubtedly the vast bulk of people in this country pay rent after their income has been taxed. That is the general rule. In the special class of cases where somebody gets free board and lodging these people are really getting a windfall. The Royal Commission on the Income Tax suggested that, in the interests of the principles of logic, efforts ought to be made to see that board and lodging was assessed as income and so evaluated. That has never been done, partly because of the great practical difficulties and partly because it has been thought that it was better for a few people to be lucky rather than to introduce great complications.
  Take the case of any domestic servant in the country. If you are really going to evaluate on logical principles what she is getting you have to take into account the fact that she gets free board and lodging. That might bring her above the Income Tax limit in these days. Take a man-servant. One man-servant may get so much a year, live in the house and have board and lodging free, while another man has a cottage and gets a larger sum, but has to pay rent for the cottage. It has been found impracticable to deal with the anomalies by scaling up one set of people and trying to assess the value of their board and lodging. The case of the Women's Land Army is simply one case in a very much wider problem and it was realised that my right hon. Friend could not tackle it, certainly not an the lines suggested in the proposed new Clause.
  It always happens that when we are lucky we do not realise our good fortune nearly as keenly as we realise our bad fortune when we are unlucky. People in the Land Army or in any other walk of life who get free board and lodging or free lodging without board' are lucky, but it would be impossible to deal with the anomaly by putting everybody who has to pay for board and lodging in the same Income Tax position as the people who get board and lodging free. It may be true to say that some of the Service allowances are treated somewhat more

  487
  generously than corresponding allowances in civilian life, but nobody would want to alter that position in the middle of the war. My right hon. Friend has stated that when peace comes and the problem is considered again, it can be considered in the light of the position of those who, in the future, may be in the Services, and it may well be found that elasticity has been carried a little further than is fair, having regard to other members of the community.
  Earl Winterton: I do not want to detain the Committee and I do not want an answer from the Attorney-General or from the Chancellor of the Exchequer to the question I have in mind. [An HON. MEMBER: "Then why ask it?"] Because it is desirable to call attention to the matter. The Attorney-General referred to other matters analogous to those arising under the proposed new Clause. Surely, in the future unless the Treasury devise some system in respect of this matter and of the analogous situation, a rather serious sense of injustice may be created. It does not seem to be a sufficient answer to say that this is the line the Treasury have always taken, because it is only within the last two or three years that this mass of wage-earners has come within this category. I imagine that after the war, whether the present basis of Income Tax is continued or not, some system will have to be found of differentiating between those who get the great benefit of living in and those outside, who receive the same wages. Otherwise, a sense of injustice will be created in the minds of the taxpayers.
  Mr. Stephen: The real remedy lies in restoring the position which existed with regard to Income Tax before there was this great extension of Income Tax payment. Among the Services, the girls in the Land Army have all along been treated as the Cinderellas and I suggest to the Treasury that, in the future, a sound way to deal with the anomaly will be to restore a much more generous exemption level.
  Mr. Brooke: The Noble Lord is quite right. The anomaly, which the Attorney-General admitted, has become much more acute owing to the great rise in the level of Income Tax. I will not press the matter further on this narrow issue of the
  488
  Women's Land Army now, so I beg to ask leave to withdraw the Clause.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Reduction of customs duties on tea.)
  The duties of customs chargeable on tea under Section one of the Finance Act, 1936, as amended by Section five of the Finance Act, 1938, shall be at the following reduced rates, that is to say:

  d.

  Tea not being an Empire product

  the lb.

  7

  Tea being an Empire product

  the lb.

  5

  [Mr. Brooke.]

  Brought up, and read the First time.
  Mr. Brooke: I beg to move, "That the Clause be read a Second time."
  Nobody would be more surprised than myself if the Chancellor were to accept this new Clause. Nor do I ask that there shall be any long discussion on it. I have moved it to call attention to the fact that apparently we are simultaneously taxing tea and subsidising it. The Tea Duty, like the tax on sugar, is an ancient Revenue duty which definitely raises the price of the commodity by the amount of the tax. Now, in wartime, the attitude of the Government has changed right round, and it subsidises various commodities in order to keep down the cost of living, Parliament previously having taxed them knowing that it would put up the cost of living. The Parliamentary Secretary to the Ministry of Food said in the House on 13th May that tea was one of the commodities that were subsidised. I therefore put down this new Clause in the hope of eliciting a statement of policy from the Government. It seems to me wrong that we should, in this House, fix a tax on a commodity at a certain level and that then the Government, without coming to this House or necessarily telling the House about it, grant what is in fact a rebate from that tax by a war-time subsidy from the Ministry of Food. I would far prefer that that was done in an entirely open way, by the Chancellor proposing to the Committee that there should be a reduction in the tax. If he says that he is anxious to safeguard his position and his taxation strength for after the war, then I express my personal opinion that this kind of tax is an obsolete kind which we ought to try to get rid of.
  Mr. Assheton: I am glad my hon. Friend does not expect the Chancellor to accept this proposed new Clause, but I think he is under a misapprehension as to the position of tea at the present time. As a matter of fact, since January last tea has not been subsidised; nevertheless I will answer his point, because it might well be that some other time the position might arise. I should like to make it clear that in the case of tea there are two reasons for maintaining the tax. One is that there is a preference, and the Government are not free, to go the whole hog and remove that tax so long as the guaranteed preference is given to Empire products.
  Mr. Brooke: A preference which my new Clause would retain.
  Mr. Assheton: I quite agree. The second thing is that the tax is a permanent part of our financial structure, and there have only been about two or three years during the last 300 years when tea has not been taxed. It is a permanent tax, and although my hon. Friend expressed the view that it is not his idea of a good tax it is part of our age-old system of taxation, and this is not the time, therefore, to withdraw it.
  Mr. George Griffiths: I am sorry that the Mover of this proposed new Clause for the reduction of the Tea Duty moved it, and then said, "For heaven's sake do not take any notice of what I say, because I do not mean a word of what I am going to say. "That is really the essence of the speech of the hon. Member for Lewisham (Mr. Brooke).
  Mr. Brooke: I said that I considered that the Tea Tax was in essence a bad tax, but that I did not believe the Chancellor could accept my suggestion to-day to reduce it to-morrow.
  Mr. Griffiths: The essence of what the hon. Member said is what I have just said to the Committee. The Financial Secretary said that this tax is 300 years old, but because there has been a tax for 300 years that is not to say we cannot find the money from some other source instead of a tax on tea. I want to say just one word, because I am thinking about the old age pensioners and about the widows who after next Wednesday, unless there is a change from the Treasury
  490
  as well as from the Minister of Health and the Minister of Labour, will still be at the level of 10s., the widows who have never had a penny-piece rise since the war. I saw one last week who has 10s. for herself and 5s. for a child. She has been a widow for 10 years. She has been out charing this week. I want to get this point over. It is no fairy tale that there are old age pensioners who after they have had their tea and stewed their tea—I do not know whether any of you chaps have ever had stewed tea or not——
  Sir K. Wood: I had some to-day in the smoke room.
  Mr. Griffiths: I was going to say they not only have it stewed, but after it has been stewed they take it out of the teapot and dry it again because they have not got the finance. If the tax was reduced to what the hon. Member for Lewisham is asking for, but does not expect, that would be an increase of income, in a sense, to the old age pensioners. I am sorry that the Financial Secretary is harping on 300 years, and that because the tax has been there it has got to go on. Because things were done in the Garden of Eden when Adam and Eve broke the law, that is not to say that these have to be continued all the time. I am sorry that the Treasury is so hard-hearted on this matter.
  Mr. Brooke: I think I have made my position quite clear to everybody except the hon. Member for Hemsworth (Mr. G. Griffiths), and I beg to ask leave to withdraw the Clause.
  Motion and Clause, by' leave, withdrawn.

  NEW CLAUSE.—(Amendment of s.46 (2) of Finance Act, 1941, as to relief from death duties.)
  Subsection (2) of Section forty-six of the Finance Act, 1941, shall cease to have effect and the following Subsection shall be substituted therefor:—
  "(2) This Section applies to the death of any person from injuries received or disease contracted by him, whether before or after the passing of this Act, but during the period of the present emergency and within twelve months of his death, being injuries or disease caused by the operations of war or incurred whilst engaged in war work or other dillies in circumstances which, in the opinion of the Treasury, involve risks similar to those incurred in the operations of war:

  491
  Provided that this Section does not apply to deaths from such causes as are mentioned in Section thirty-eight of the Finance Act, 1924, of persons to whom that Section applies, or to deaths from such causes as are mentioned in Subsection (1) of Section sixty-four of the Finance Act, 1940, of persons to whom that Subsection applies."—[Mr. Barnes.]
  Brought tip, and read the First time.
  Mr. Barnes: I beg to move, "That the Clause be read a Second time."
  I have had correspondence with the Chancellor on this matter, and therefore it can be narrowed down in this Debate before the Committee. Section 38 of the Finance Act, 1924, made certain provision for the remission of Death Duties for Service personnel engaged in the operations of war. If I understand the interpretation which the Treasury puts upon this, it is that as soon as the Forces are mobilised for war every one of them becomes on active service against the enemy. Of course, everyone will agree with this, by being classified on active service against the enemy, every member of the Forces is entitled to this concession. Section 64 of the Finance Act, 1940, extended this to certain sections of the Merchant Service and fishing boats and other categories, who die from causes arising from the operations of war, and Section 46 of the Finance Act, 1941, extended it to civilians who die from injuries caused by the operations of war. I want to call attention to the difference in the language dealing with these three categories. Regarding the Services, the language used is:
  "On active service against the enemy."
  Under Section 64 of the 1940 Act dealing with classes of the Merchant Service the language is:
  "Causes arising from the operations of war."
  And with regard to the concession to civilians the language is:
  "From injuries caused by the operations of war."
  I wish to cite a particular case. It seems to me that here we have a problem of equity. On 7th June, 1942, an R.A.F. plane met with an accident, and the personnel of that plane were kilted. There were R.A.F. and civilian personnel in the plane. The coroner's verdict was very clear: "Death due to multiple injuries to Royal Air Force personnel on duty, and civilian personnel, as authorised
  492
  passengers in the aeroplane, were also on duty." The estate of a high ranking officer in the R.A.F. who meets with an accident while flying in this country for any purpose, is exempt from Estate Duties. The estate of a high technical research civilian engaged on Government war work, who is refused permission to join the Services and is killed while flying on experimental duties with the officer referred to, is not exempt. The estate of a civilian not engaged on war work, who is accidentally killed by a plane returning from active operations against the enemy, is exempt from Estate Duties, while the estate of a civilian killed by a training plane is not exempt. In view of the time, I do not propose to argue the case at length. I think I have put the issue very clearly. The whole matter is one of interpretation. In each category it rests with the Treasury to decide whether the death arises from the operations of war, and, in so far as I have examined them, I fail to find how the Treasury excludes any of these cases.
  Sir K. Wood: I am indebted to my hon. Friend for dealing so briefly with the matter. We have had some correspondence about it, and I have endeavoured to give him some reasons for the conclusions which have been reached as to the payment of certain claims. It is true that when we reach conclusions we have to look at the provisions of the Act of Parliament. It is true that there is a differentiation between people in the Forces and civilians, as laid down by the Act. My hon. Friend is seeking to repeal Section 46, which relates to civilian deaths, and which is applied in the case of injuries caused by the operations of war. My hon. Friend desires, at any rate for the purposes of the discussion to-day, first, to include disease so far as civilians are concerned, and then—I know that this phraseology is very difficult to draft, but it would be more difficult to interpret—
  "disease caused by the operations of war or incurred whilst engaged in war work or other duties in circumstances which, in the opinion of the Treasury, involve risks similar to those incurred in the operations of war."
  There is this distinction in regard to disease. Members of the Forces are subject to a medical examination before they are taken into the Forces, and so we are able to come to some measure of reasonable conclusions as to whether——
  Mr. McNeil: Not very reasonable conclusions.
  Sir K. Wood: I hope that my conclusions would be reasonable. I am not referring to the decisions of medical boards or anything like that. It gives some measure of guidance as to whether the disease from which a man may die arose out of war service. But I will not provoke a discussion on whether all the decisions are advisable or not. It would be impossible, in relation to the millions of civilians, to reach a conclusion of that kind at all as they have not undergone any medical examination. I am afraid that my hon. Friend's suggestion that the Treasury should endeavour to come to a conclusion on whether the disease was caused while the person was
  "engaged in war work or other duties in circumstances which, in the opinion of the Treasury, involve risks similar to those incurred in the operations of war,
  would be extremely difficult to carry out in practice. In the course of my correspondence with my hon. Friend, cases like this arose. You might have a scientist engaged in an experimental flight, on which he meets his death. Under the Clause, it would be for the Treasury to decide whether death was the result of the war or not. In a large number of cases, death might have happened in just the same way in peace-time. It would be difficult to say that it arose out of the war. All sorts of difficulties might arise. I have dealt briefly with this matter, but I hope my hon. Friend will not think that I do appreciate his argument because I have not replied at great length. I shall he glad to talk further with him about this subject. But the Clause would be very difficult to operate.
  Mr. Barnes: I appreciate the difficulty of framing an adequate Clause without the proper technical advice. In view of the Chancellor's intimation that he will give me facilities for again looking into the matter, I beg to ask leave to withdraw the Clause.
  Motion, and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Exemption of certain voluntary superannuation funds.)
  Sub-section (2) of Section thirty-one of the Finance Act, 1933 (which repeals Sub-section (4) of Section thirty-nine of the Income Tax Act, 1918), shall cease to have effect in so far as the said Section thirty-nine applies to a
  494
  voluntary superannuation fund registered as a society under the Industrial and Provident Societies Act, 1893, and the said Sub-section (4) of Section thirty-nine of the Income Tax Act, 1918, shall have effect accordingly.—(Mr. McNeil.)
  Brought up, and read the First time.
  Mr. McNeil: I beg to move, "That the Clause be read a Second time."
  I shall try to telescope my argument as much as possible, because I do not want to detain the Committee. The basic purpose of this Clause is that the voluntary superannuation fund of the National Union of Journalists should have its position so eased as to be able to continue, and, in conformity with the usual practice of this House, I had better say that I am a member of that union, although I have no financial interest at all in the fund. I think that the argument for the Clause is fairly strong. I hope that the Chancellor will think so, too. At any rate, if he agrees that the purpose of Section 31 of the 1933 Act, like that of any other financial provision, is to enable him to collect certain moneys, to do that in an orderly fashion, and to collect it justly, I think I shall be able to show him that if he resists this Clause he will get no money by his resistance, and that he will perpetuate hazardous and fortuitous circumstances and bring injustice, at any rate to a small section of this community. This fund was founded in 1925. It differed from the ordinary superannuation fund in that it was not a joint fund, to which employers and employees contributed, because the union had found it impossible to secure the agreement of the employers.
  The editorial side of the newspaper industry is a curious one. There is a considerable section of the industry which comprises free lance journalists, that is to say, those who have no salary attachment to any one employer but are paid by results, and that is the basic reason why a joint fund was impossible. To overcome this difficulty, in 1925, this fund was promoted by the Union under the Industrial and Provident Societies Act, as the law required, and thus secured the exemption from taxation of its investment funds under the appropriate Section of the 1918 Act. But in 1933, under the Finance Act of that year, this fund was compelled to pay taxation. At that time, the Union, having failed to sustain its appeals, tried to set its domes-

  495
  tic finances in order within the fund, and because the taxation level was only 5s. they were able to reduce their contracting benefits and carry on for a time. But as the taxation level increased, so the difficulties became greater, until—and this is the reason why my hon. and right hon. Friends and myself raise the matter—the fund has had for the last two years to cease recruiting members. Indeed, unless the Chancellor can agree, the fund will have to close down altogether. It must be wound up. That is why I say that, even if the Chancellor resists this new Clause, he cannot secure any moneys from the fund.
  It would be bad enough if the Chancellor, in pursuing a deliberate policy, felt that he had so to treat this fund. I hope that I shall be able to persuade him that it is a fortuitous circumstance and that it was never intended that this fund should so be treated. Under Section 31, Subsection (2) of the 1933 Act, the position of this fund changed and it is that portion of this Sub-section that we by this Clause seek to repeal. I could quote at some length to prove that that Sub-section was never intended to deal with this fund. When the then Chancellor of the Exchequer—the late Mr. Chamberlain—introduced this Sub-section, which was the most controversial Sub-section dealing with the undistributed profits of the co-operative societies, he said that they expressed their agreement with the majority of the Royal Commission which reported in 1920 that the amounts arising from trading with members, the so-called mutual trading, should be made chargeable to Income Tax. He went on to say that he anticipated in that year that by this Sub-section he would gain £1,200,000, all of which he calculated would be got exclusively from the co-operative societies. The then Financial Secretary to the Treasury, in piloting this Sub-section through on 31st May, 1933, made the same assumption throughout his speech. He said that there would be no distinction whatever between the co-operative society and the ordinary trader, and he went on to talk about traders and cooperative societies. Plainly, any one who cares could satisfy himself that this Subsection dealt only, and was intended to deal only, with the co-operative societies.
  If there is any doubt in the minds of the Committee I would push it aside by
  496
  saying that the Financial Secretary who made that speech and who piloted that Sub-section through is by coincidence one of the signatories to the Clause which I have moved. He is my right hon. Friend the Member for Devonport (Mr. Hore-Belisha) and he authorises me to say that he regrets he cannot be here and that he is firm and clear in his mind that at no time in these discussions was it ever intended or imagined that this voluntary superannuation fund, for which we presently plead, would be caught up by that Sub-section. So that, as I say, not only will the right hon. Gentleman get no additional funds, but he will be caught up by an accidental turn of his own wheel, and I think I can demonstrate too that he will be perpetuating an injustice. We are really talking about men and not a fund.
  Recently the hon. Member for Gorbals (Mr. Buchanan) said in this House that what he called the decencies of life were the concern of democracy. So here we are talking about men who, previously, were excluded from a joint fund because if they had been members of a joint fund, then under the appropriate Section of the 1931 Act, they would have been exempt from this taxation. But because they had no joint contribution, they voluntarily made provision for their reetirement, and the Chancellor, in effect, says, "As you are having to carry one burden, I am going to ask you to carry three burdens." These men must first pay the tax on their own earnings; from their own earnings they have to make a sufficient contribution to ensure a reasonable standard of retirement, and now, they have also to meet this taxation. In 1933 the fund was solvent. It had a balance of £1,077; to-day it has a deficit of £22,720. Naturally my hon. Friends and I are not tied to the actual wording of our Clause. I think I can, with perfect justice, ask the Chancellor to make it possible for this fund to continue. At any rate, if he cannot see his way to do that, I plead with him to devise some amendment so that the bargain which the officials of this Union made with these ordinary, law-abiding, hard-working citizens who have tied themselves to certain contributions in return for certain benefits and who are, many of them, now near retirement, can be kept.
  Mr. Woodburn: I want to reinforce what my hon. Friend the Member for Greenock (Mr. McNeil) has said. I am not a member of the National Union of Journalists, although I have some association with the profession, and some of my friends in the Northern part of the country have asked me specially to support this plea. I think the main point is a simple and human one. Men were encouraged by the State to enter into these superannuation arrangements, and in every other profession except this it has been possible to enter into this operation in co-operation with employers. But in the chance circumstances of this profession men have not been able to do so, and they are now reaching an age when they cannot enter into new contracts, because they are long past that stage. The circumstances are rather tragic. The men who have made provision for their old age are now approaching what will be a very uncertain future, not because of any fault of theirs, but because of the freakish application of one particular taxation Clause. If this was applied to all mutual assurance of this kind, one could understand it, but when it is not it seems to be unfair. We do not expect the wording of this Clause to be accepted, because it is rather difficult when one is not a Parliamentary draftsman, but I hope the Chancellor will give it favourable consideration.
  Sir K. Wood: I would like to congratulate the hon. Member for Greenock (Mr. McNeil) on the excellent way in which he moved this new Clause. I cannot hold out any hopes of agreeing to the proposal on the Order Paper, which, as hon. Members will appreciate, would make a permanent alteration in the law, but between now and the Report stage I will enter into negotiations with those who are interested to examine the latter part of the proposal made by the hon. Member. I realise from what he said that there are people who are interested in this fund—indeed, I know some of them—and I would be the last to do anything harmful to them if it could be avoided. However, as I have said, I and my advisers will consult with those interested to see whether it is possible to do something in the way proposed by the hon. Member in the latter part of his speech.
  Mr. Bellenger: The Chancellor has met my hon. Friend the Mem
  498
  ber for Greenock (Mr. McNeil) very fairly in the circumstances, but I would like to impress upon him the fact that several of us wanted to put our points of view before him on this matter, but have refrained from doing so in view of the late hour. I hope he will keep this in mind.
  Sir K. Wood: Certainly.
  Mr. McNeil: On the Chancellor's assurance of sympathetic consideration I beg to ask leave to withdraw the Clause.
  Motion and Clause, by leave, withdrawn.

  NEW CLAUSE.—(Amendment as to allow ance for repairs.)
  Section twenty-eight of the Finance Act, 1923 (which relates to the allowance for pairs and which was continued in force by Section twenty-seven of the Finance Act, 1942, until the fifth day of April, nineteen hundred and forty-seven) shall have effect as if in Sub-section (2) of the said Section twenty-eight for the words "one-fourth," "one-fifth," "twenty pounds" and "one-sixth." there were substituted respectively the words "one-third," "one-fourth," "twenty-five pounds," and "one-fifth."—[Mr. Bellenger.]
  Brought up, and read the First time.
  Mr. Bellenger: I beg to move, "That the Clause be read a second time."
  The point I wish to put to the Chancellor and the Committee on this Amendment is a substantial one, and although I do not propose to take up a lot of time in elaborating it my argument, briefly, is this: The Chancellor knows that in arriving at the net assessable value of house property and, indeed, all properties under Schedule A tax, the statutory allowance for repairs is deducted from the gross value to arrive at the net annual value for Schedule A tax. That statutory allowance was fixed many years ago—I think it first appeared in the 1923 Act—and it varied according to the value of the property fixed by the tax assessors each year. In the case of small properties under a value of £40 per annum the allowance is one quarter, or £10 per annum. I think even the Chancellor himself, although he may live in a house which is assessed at more than £40 per annum, will agree that it is impossible, and will be impossible for many years after the war, to carry out properly repairs to houses of that kind by an expenditure of £10 each year. If one takes the type of house which I imagine

  499
  the Chancellor lives in—a house of £100 a year or over assessable value—the allowance for repairs is higher. It is £20 if it has an assessable value of £100, and it is one-sixth for anything over £100. That case is even worse. The bigger the property the less adequate becomes the allowance for repairs. It may be said that this difficulty may be overcome by the alternative which is open to taxpayers to take a five years' average so that the Commissioners can accept that as the actual cost of repairs spread over that five years. But I think this is a difficult and cumbrous operation of the Schedule A tax and, moreover, small taxpayers have a long time to wait.
  I believe that those who pay Schedule A tax can actually submit to the tax inspector the cost of repairs year by year, but even that is not quite adequate, because during the war owners of property are not permitted to carry out repairs, because they cannot get materials and labour. So, repairs are accruing, and at the end of the war there will be a heavy bill. The allowance which the Chancellor makes under the Finance Act is inadequate. I hope the right hon. Gentleman realises the force of the point I am putting to him and will be prepared to deal with my Clause in the same way as he dealt with the preceding one. This is a matter which is agitating the minds of house property owners all over the country; we ought to bring our Finance Acts up to date and keep them modern. The statutory allowance for repairs is totally inadequate, and on the grounds of equity to the taxpayer and on the ground of encouraging house owners to keep their property in good repair, we ought to grant a proper allowance.
  The Attorney-General: Taxpayers who are affected by these provisions of the Income Tax Acts are in a favourable position, which, perhaps, cannot be said of all taxpayers. They are in a favoured position for this reason. There is a scale laid down which is deducted from the annual value, whether any repairs are carried out or not. A person may have a new house to which no repairs are necessary for some time, but still get an allowance accruing according to the annual value of the house. On the other hand, if you live in a house which needs repairs over and above this scale, if you take the trouble
  500
  to keep a record of the money you spend on repairs, you can claim on the actual money that you spend. It would be difficult to see how you could have fairer or more generous provision than that, an automatic scale applied whether you do repairs or not, the actual repairs, taken over an average, I agree, as they must necessarily be, if you think the scale does not meet your case. Therefore my right hon. Friend does not feel that this is a matter which he should undertake to look into further or deal with now.
  As the hon. Member said, at the moment one cannot spend anything on repairs, and surely it cannot be the right time to put up the automatic allowance when it is more or less conceded that no one will be able to spend that amount of money. When we get into the times when repairs can be done and the house situation gets more normal, it may well be that the cost of repairs will be found to have gone up, but it may also be that annual values will have gone up too, and they may have gone up to an extent which makes the existing proportion a reasonable one. The only circumstances in which it would be right to reconsider these automatic deductions would be not so much in the interests of taxpayers but in the interest of saving everyone trouble. If it can be shown that, taking the country as a whole, these proportions have fallen, having regard to the various alterations in cost of repairs and annual values, below the general average cost, there would be a case for putting them up. At present there is not and there could not be, because repairs cannot be done. I agree, to this extent only, that these proportions ought to represent the general average of repairs over the whole country. Until it can be shown that they have got out of step with that general average my right hon. Friend does not think it would be right to alter them, and, if anyone is spending more, he has only to take the trouble to keep a record of what he spends and he gets it allowed as a deduction.
  Question, "That the Clause be read a Second time," put, and negatived.

  NEW CLAUSE.—(Amendment of Retail Licence Duties.)
  Section thirteen of the Finance Act, 1942, shall be amended by the substitution of the words "twenty-five per cent." for the words "five per cent." and by the substitution of the

  501
  words "any licensed retailer's on or off licence" for the words "a publican's licence."—[Mr. Boothby.]
  Brought up, and read the First time.
  Mr. Boothby: I beg to move, "That the Clause be read a Second time."
  Having started the day with clergymen, it is perhaps appropriate that I should conclude it with publicans. Last year's Finance Act allowed a rebate of 5 per cent. on publicans' licences only in respect of diminution in supplies of wines and spirts. This was felt in the trade to be inadequate, but no very strong protests were made because the conditions prior to last year were not so bad in view of the existence in most cases of considerable surplus stocks. But it was felt that any concession should also apply to the off-retailer, and the off-retailer in Scotland includes the licensed grocer, who is rather an important factor in this connection. The surplus stocks which enabled the retail licence trade to carry on are now completely exhausted, and at present the proportion of spirits allocated to retailers on their former supplies is not usually more than about 5o per cent, of what they used to get, and on wines only about 3 per cent. So there is an immense reduction in their turnover. In the Finance Act, 1917, Section 7, holders of Excise liquor licences were granted a rebate of three-quarters of the payment in compensation for diminution of supplies of spirits and wines which they received. The diminution is certainly not less in this war. It was recognised by this rebate in the last war that retailers should not be asked to continue to pay an amount of duty out of all proportion to the volume of the trade they were doing. All that I am seeking is to persuade the Government that retailers are now being asked to pay a licence duty out of all proportion to the amount of trade that they can possibly do in view of the supplies of spirits and wines that they are receiving. My Clause seeks a reduction of 25 per cent, in the licence duty, as it were by way of compensation for the reduced turnover, and it is applicable to both on and off holders of retail licences, because it is not fair to discriminate between the two.
  Mr. Assheton: My hon. Friend has certainly covered a very wide field to-day in the attention that he gave to the claims of the clergy and, no doubt just as important, the attention that he is giving to
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  the claims of publicans and those who sell retail wines and spirits. In the Finance Act of last year there were two Sections dealing with this problem, Section 13, which dealt with the reduction of duty on publicans' licences in respect of diminution in supplies of wines and spirits, and Section 14, "Relief from duty where trade diminished by war circumstances." I am not quite clear whether he appreciates the effect of the latter Section. It provides Licence Duty relief in view of the shortage of supplies and, except as far as the publican's licence is concerned, the relief is based on the trade done in each separate liquor and applies to each separate licence. The amount of the relief is two-thirds of the amount of the diminution in trade. I am not sure whether I understood him aright. Was he suggesting that it should be three-quarters instead of two-thirds?
  Mr. Boothby: Yes.
  Mr. Assheton: If that is the suggestion, I am sorry to say that my right hon. Friend cannot accept it.
  Mr. Boothby: In view of my hon. Friend's categorical statement, I beg to ask leave to withdraw the Clause.
  Motion and Clause, by leave, withdrawn.
  Schedules r to 6 agreed to.

  SEVENTH SCHEDULE.—(Application of Income Tax Provisions to Excess Profits Tax and the National Defence Contribution.)
  Sir G. Schuster: I beg to move, in page 29, line 13, at the end, to insert:
  "140.—(1) A person who has delivered a return or particulars which he has been required under the enactments relating to excess profits tax or the national defence contribution to deliver or furnish and discovers any omission or wrong statement therein, may deliver an additional return or additional particulars rectifying the same, and shall not thereafter be liable to any proceeding by reason of his omission or wrong statement.
  (2) A person who has not delivered such a return or such particulars within the time limited may deliver it or them at any time before proceedings for recovery of a penalty, incurred in respect of such non-delivery, have been commented, and thereafter no such proceedings shall be taken."
  The Seventh Schedule makes applicable to Excess Profits Tax and National Defence Contribution the penalties for

  503
  failure to deliver true and correct Income Tax returns which were imposed by Section 107 of the Income Tax Act, 1918. That Act also contained a relieving Section, Section 140, which empowers the taxpayer to amend his return on discovery by him of any omission or wrong statement, and it goes on to enact that the taxpayer shall not thereafter be liable to any proceedings by reason of his omission or wrong statement. It is obviously right and proper that the penalties imposed under Section 107 with regard to false Income Tax returns should be imposed for false returns for Excess Profits Tax and National Defence Contribution, but I think that my right hon. Friend will be ready to admit that as a matter of equity the corresponding relieving provisions of Section 140 should also be applied.
  Sir K. Wood: I think that my hon. Friend has put forward a reasonable case. As we have incorporated the major part of the Section, it is fair that what is called the relieving Section should be applied in these cases. In accepting the Amendment, I do not want the matter to be misunderstood by anybody. If anybody is guilty of fraud and sends in a corrected statement afterwards, it will not get him out of his trouble. With that clear understanding I see no reason why this protection should not be equally applicable in these cases as it was in the other. Therefore I accept the Amendment and congratulate my hon. Friend on getting the Amendment into the Bill.
  Amendment agreed to.
  Schedule, as amended, agreed to.
  Eighth Schedule agreed to.
  Bill reported, with an Amendment; as amended, to be considered upon the next Sitting Day.

  PURCHASE TAX (EXEMPTIONS) (BATTERIES)
  Resolved,
  "That the Purchase Tax (Exemptions) (No. 2) Order, 1943, dated 6th May, 1943, made by the Treasury under Section 20 of the Finance (No. 2) Act, 1940, a copy of which was presented to this House on 13th May, be approved."—[Mr. Assheton.]

  TELEGRAPH BILL
  Considered in Committee; reported, without Amendment; read the Third time, and passed.

  SUNDAY CINEMATOGRAPH ENTERTAINMENTS
  Resolved,
  "That the Order made by the Secretary of State for the Home Department extending Section I of the Sunday Entertainments Act, 1932, to the Townships of Ormskirk and Burscough in the Urban District of Ormskirk, a copy of which was presented to this House on 1st June, be approved."—[Major Sir James Edmondson.]
  The remaining Orders were read, and Postponed.
  It being after the Hour appointed for the Adjournment of the House, Mr. DEPUTY-SPEAKER adjourned the House, without Question put, pursuant to the Standing Order.

  ARMED FORCES (PENSIONS AND GRANTS)
  ARMED FORCES (PENSIONS AND GRANTS)
  BRITISH INTERNEES, FRANCE REPATRIATION)
  BRITISH INTERNEES, FRANCE REPATRIATION)
  FRENCH NAVAL SQUADRON, ALEXANDRIA
  FRENCH NAVAL SQUADRON, ALEXANDRIA
  PARLIAMENTARY CANDIDATES (NAVAL UNIFORM)
  PARLIAMENTARY CANDIDATES (NAVAL UNIFORM)
NATIONAL FINANCE
  Fitzwilliam Estate (Death Duties)
  Fitzwilliam Estate (Death Duties)
  Civil Service Pensions
  Civil Service Pensions
  PRISON SERVICE (PROMOTION)
  PRISON SERVICE (PROMOTION)
  SENTENCED MAN'S DEATH (INVESTIGATION)
  SENTENCED MAN'S DEATH (INVESTIGATION)
  HEAVY VEHICLES (SPEED)
  HEAVY VEHICLES (SPEED)
  POLICE FORCES (AMALGAMATION)
  POLICE FORCES (AMALGAMATION)
  WOMEN PRISONERS (MATERNITY CASES)
  WOMEN PRISONERS (MATERNITY CASES)
PUBLIC HEALTH
  Special Diets (Medical Certificates)
  Special Diets (Medical Certificates)
  Tuberculosis (Free Treatment)
  Tuberculosis (Free Treatment)
  National Health Service
  National Health Service
  CAMP SCHOOLS (COST)
  CAMP SCHOOLS (COST)
  River Pollution
  River Pollution
  National Parks
  National Parks
SCOTLAND
  Assistance Board Office, Johnstone
  Assistance Board Office, Johnstone
  Teachers (Recruitment and Supply)
  Teachers (Recruitment and Supply)
FOOD SUPPLIES
  Retail Prices (Subsidies)
  Retail Prices (Subsidies)
  Soya Sausages
  Soya Sausages
  SOAP MANUFACTURE (RESTRICTION)
  SOAP MANUFACTURE (RESTRICTION)
  HOUSING (POST-WAR SUBSIDIES)
  HOUSING (POST-WAR SUBSIDIES)
  GREAT BRITAIN AND UNITED STATES (MUTUAL AID AGREEMENT)
  GREAT BRITAIN AND UNITED STATES (MUTUAL AID AGREEMENT)
  TRAVEL TO INDIA (WOMEN AND CHILDREN)
  TRAVEL TO INDIA (WOMEN AND CHILDREN)
  DISABLED SERVICEMEN (ARTIFICIAL LIMBS)
  DISABLED SERVICEMEN (ARTIFICIAL LIMBS)
  BUILDING INDUSTRY (JUNIOR TECHNICAL SCHOOLS)
  BUILDING INDUSTRY (JUNIOR TECHNICAL SCHOOLS)
  MINISTRY OF INFORMATION (Mr. H. P. SMOLLETT)
  MINISTRY OF INFORMATION (Mr. H. P. SMOLLETT)
  GERMAN AIRMAN'S BURIAL, WESTON-SUPER-MARE
  GERMAN AIRMAN'S BURIAL, WESTON-SUPER-MARE
  FURNITURE, REQUISITIONING
  FURNITURE, REQUISITIONING
  RATION BOOKS AND IDENTITY CARDS (DISTRIBUTION)
  RATION BOOKS AND IDENTITY CARDS (DISTRIBUTION)
  AIRCRAFT FACTORIES (ACCIDENTAL FIRES)
  AIRCRAFT FACTORIES (ACCIDENTAL FIRES)
  BRITISH PRISONERS OF WAR, GERMANY (R.A.F. RAID)
  BRITISH PRISONERS OF WAR, GERMANY (R.A.F. RAID)
  TINPLATE AND STEEL WORKS, WALES
  TINPLATE AND STEEL WORKS, WALES
Preamble
The House met, The LORD CHANCELLOR on the Woolsack.
BRIDGWATER GAS BILL.
Read 2, and committed.

COAL BILL. [H.L.]
THE PARLIAMENTARY UNDER-SECRETARY OF STATE FOR INDIA AND BURMA (THE EARL OF MUNSTER): My Lords, I beg to introduce a Bill to amend the Coal Act, 1938, and to dissolve the Coal Mines National Industrial Board. I move that the Bill be now read a first time.
Moved, That the Bill be now read 1.—(The Earl of Munster.)
On Question, Bill read 1, and to be printed.

RAILWAY FREIGHT REBATES BILL. [H.L.]
Returned from the Commons, agreed to, with an Amendment.

BUSINESS OF THE HOUSE.
LORD SNELL: My Lords, on behalf of my noble friend Viscount Cranborne, I beg to move the Motion standing in his name on the Paper.
Moved, That Standing Orders Nos. XXI and XXXIX be considered in order to their being dispensed with for the purpose of giving precedence to the Consolidated Fund (No. 3) Bill, over the other Notices and Orders of the Day, and in order to take the Bill through its remaining stages.—(Lord Snell.)
On Question, Motion agreed to, and ordered accordingly.

CONSOLIDATED FUND (No. 3) BILL.
Read 2 (according to Order): Committee negatived.
Then, Standing Order No. XXXIX having been suspended, Bill read 3, and passed.
House adjourned during pleasure.
House resumed.

ROYAL COMMISSION.
The following Bills received the Royal Assent:

Consolidated Fund (No. 3),

War Damage,

Housing (Agricultural Population) (Scotland),

Sunderland Corporation.

House adjourned during pleasure.
House resumed.

CATERING WAGES BILL.
Order of the Day for the Third Reading read.
LORD SNELL: My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read 3.—(Lord Snell.)
LORD HEMINGFORD: My Lords, I scarcely think that this Bill ought to pass your Lordships' House without a few observations on Third Reading. There are several Amendments on the Paper, some of them in my name. I understand that the Government are not in the least inclined to give any concession on those Amendments, and I think that perhaps I shall save your Lordships' time by not moving them, but by contenting myself with a few remarks on Third Reading. By all that I have understood of the canons of good legislation, this Bill is a bad Bill, and it is untimely in its introduction and passage through Parliament. It is obscure, and those who are concerned with it will find it very difficult to understand. It is likely to lead to litigation. There are considerable differences of opinion among lawyers as to the meaning of it. As to that, I need do no more than remind your Lordships of what took place on the Committee stage of the Bill in this House, when there were obvious differences of opinion as to the meaning and effect of the Bill. It is a kind of legislation which, though it may be necessary at times, is at least inadvisable, and should be used most sparingly. It is not direct legislation, but throughout gives powers to a Minister or Government Department to legislate or exercise powers. It is true

815
that the consent of Parliament, in a somewhat illusory form, is necessary, in that Orders made under it have to be submitted to Parliament, but this form of legislation is decidedly objectionable, in that it concerns itself entirely with putting powers into the hands of a Government Department.
I have said that I think that the Bill is a bad one. I would draw attention to the title of the Bill, and particularly to the last words of that title. It is described as:
"An Act to make provision for regulating the remuneration and conditions of employment of catering and other workers … and the general improvement and development of the industries in which they are employed."
I have searched the Bill to find, if I can, anything which is likely to be for "the general improvement and development of the industries" concerned. I find that that phrase is used on page 5 of the Bill, where it is provided that a wages board—
"shall have power to consider any matter affecting … the general improvement and development of that part of the industry in relation to which the board operates…"
I can only imagine a sort of cold shiver going through most of those people concerned in the industry if a wages board should take those matters into consideration. I do not see what it is likely to be able to do to improve or develop the industry, and I do not think that its interference, as the nominees of a Government Department, would be likely to be welcomed by anybody concerned in the industry.
Fortunately, perhaps, there would not seem to be necessarily any results to follow from the fact that a wages board does take these matters into consideration. That, indeed, is rather characteristic of the whole of the Bill, which begins by saying that the Minister of Labour and National Service "shall establish a Commission," but beyond that there is nothing in the Bill except about what the Minister may do. The Minister in the Commons tried to reassure the House by saying that the Bill would be worked in such a way that nobody need have any apprehensions as to its effect. Probably the best thing would be for the Minister, having done what he has to do and having established a Commission, to do nothing more in the matter until the war is over.
816
I said that the Bill was untimely. I will, for argument's sake, admit that there may have been a good case for regulating wages in the industry before the war, and there may be a good case for doing so after the war; but I cannot imagine that there is really any demand for it in the interests of those employed in the industry in this time of war. All that need happen, if any class of employee is badly treated, is for those concerned to go elsewhere; and I do not suppose that the Minister of Labour would prevent their leaving the catering industry in order to go into munition work, or something of that kind, where they would presumably earn substantial wages and be well off. If it be the case that the Bill is not really wanted at the present time, during the war, it seems to me most unfortunate that it should have been introduced at this time. I venture to think, though it may be bold of me to say so, that if a Government composed of the same persons as are members of the Government at the present time had had this Bill brought before them for consideration in normal times of peace, it would never have been introduced as a Government Bill.
I should really have liked to conduct an elementary examination of members of the Government in the contents and effect of the Bill. There are three members of the Government who were concerned with it in another place—the Minister of Labour, the Parliamentary Secretary to the Ministry of Labour, and the Solicitor-General, who would no doubt have passed that examination with flying colours. Coming to your Lordships' House, the noble and learned Viscount on the Woolsack, I know, would have passed the examination with flying colours at the present time, but I venture to think that it he had gone in for that examination some three or four days before the Bill was introduced in your Lordships' House he would have been completely and hopelessly ploughed. With regard to the other members of the Government, if fifty per cent. marks were necessary for a pass, I venture to think that not one-third of the members of the Government would have passed the examination on the contents and effect of the Bill. I do not blame them; they have got something very much better to do, and in the circumstances of the present time a matter of this kind is apt to be left to a particular Department.

817
But what is the Department concerned? It is the Ministry of Labour, and I think that the Minister of Labour's time would have been very much better occupied in some other task than steering this somewhat contentious Bill through Parliament. His task in the Government for the purposes of the war is one of the most important and he has done extraordinarily good work, but, being human, even his work in that office has not been perfect. There have been, as we know, many cases where his time would perhaps have been far better occupied, for instance in seeing that a manager of an important export business, earning and deserving a salary of four figures a year, was not taken away from that business at the age of 38, put into the Pioneer Corps, and sent to dig gravel. That is only an example. There are other key men who have been taken away from their work under the regulations and rules which the Minister has made, and set to do a private's job. Again, I do not know that one can blame the Minister, but if he had devoted a little of the time which he has had to give to this Bill to dealing with matters of that kind, I think he would have been far better occupied. There is also the case of young men in munitions, not particularly skilled young men—at all events young women are trained to do the same work in the course of a couple of months. There are thousands of those young men still employed in munition work. A few hundred of them might well have been spared from that work, which could have been done by women, and they could have been sent into the ranks in place of the key men of whom I have spoken, who have been, taken and put into the ranks of the Forces—a real and severe loss to the business of the country.
Another thing I cannot help remarking with regard to this Bill is that it seems to me to be what I can only describe as a partisan Bill from one end to the other. It is meant, and no doubt very rightly and properly meant, to assist the employees. But it is hardly reasonable that it should neglect so absolutely and completely as it does the interests, not only of the employers, but of the general public and those who are served by this industry. There is an Amendment to Clause 2 in the name of my noble friend Lord Iliffe which, I am given to understand, the Government are likely to accept. If that Amendment is carried the
818
Bill will contain a provision enabling the Commission to make inquiries into "means for meeting the requirements of the public, including in particular the requirements of visitors from overseas, and for developing the tourist traffic." If that Amendment is passed it will be the only reference in the Bill to the general public and those who are served by this industry. The references to employers are all in connexion with the interests of the employees. Although the rights, or supposed rights, of the employees are to be considered and protected so fully, nowhere in the Bill is there the slightest appearance of any sort of regard for the protection of the interests of the employers. There is a clause which enables a disabled person to be employed at less than the minimum statutory remuneration, but, apart from that, there is nothing whatever to ensure that those who are to receive this minimum remuneration play their part or do their duty towards their employers. For that reason I think this is a partisan measure. Although its principal object may well be, and should he, the protection of the employees, there should at least be some recognition of the fact that employers have rights.
The Bill, admittedly—I think I am right in saying "admittedly" on the part of the Government—is likely to be unnecessary in very many respects, but in those circumstances why should the Bill include all sorts and kinds of bodies concerned in catering, like the big voluntary hospitals, the colleges of Oxford and Cambridge, and a number of other catering businesses within the meaning of the Bill carried on not for profit, and carried on in such a way that those concerned are undoubtedly feeling that they have very good places which they do not want to lose? Why all those bodies should be included in this Bill I cannot for the life of me imagine. I venture to hope that the opposition which this Bill met with in another place will be something in the nature of a warning to the Government to keep a rather more careful eye on Departmental legislation introduced during the strenuous days in which we live. In another place certain concessions were made towards the end, but they were very limited, and those which some of us have asked for in this House certainly stand not the least chance, I understand, of being accepted by the

819
Government. Therefore I think all that I can do is to ask your Lordships to watch Bills of this kind which come forward, and so far as you can bring pressure upon the Government to refrain from introducing bad and untimely Bills at this time, when all of us who have any powers whatever should be devoting the whole of our thoughts to the prosecution of the war.
VISCOUNT BENNETT: My Lords, when I spoke a few days ago on this Bill I had in mind only one matter, and that was tourist traffic. Listening to the discussions that took place in this Chamber induced me to read the Bill more carefully, and while I should not associate myself with the strong denunciations of the measure to which we have just listened, because of my lack of knowledge of the matter as a whole, I think it well to point out that this legislation strikes a very clear blow at our ideas of democracy. I have seen no legislation in my time in which such great power has been given to one man to determine issues so far-reaching. First of all, the Minister appoints a Commission—not the Kingin-Council, but the Minister—and the same Minister appoints a wages board. The powers given to the Commission are not final. When the Commission make a report to the Minister, he may send it back to them with such observations as he thinks necessary. Is that quite fair to the Minister in days of Party Government when the issue is a question of men banding themselves together into organizations to demand from their employers certain benefits in the way of fixing a minimum wage? It is both unfair to the Minister and to the public.
Let us consider what would arise in the event of a pending Election. Suppose the whole of the catering employees have made up their minds that they must have better wages. The Commission hear their case, and I am bound to say that the provisions as to notice seem to me more than ample. There is an opportunity for everyone to present his views to the Commission, and the Commission decide it is inadvisable to increase wages at that time. Thereupon the Minister rejects the report and sends it back to the Commission for reconsideration, with such observations as he may think desirable. What is the effect of that? Either one of two things must
820
happen. Either the Commission must bow to the observations of the Minister, or you have a complete deadlock in which neither side is prepared to change its mind.
The Minister has no power to make an order, I am bound to say, until such time as he has a report, and if he does it is the Minister's order, not the order of the Commission or the order of the Government as such. The Minister's order can only be made after he has received the report of the Commission. If, having received that report, he sends it back with his observations, the Commission are authorized to amend it if they so desire. In that event, if they do amend it, then it is to be treated as a new proposal and, as the Bill says, the same rules shall govern it as in the case of the original proposal. That, of course, means further delay. So much for the Commission. Then a wages board is set up consisting of an equal number of representatives of employers and employees, and others supposed to be independent who are appointed by the Minister. They make inquiries and submit a report, and it is upon that final report that the Minister is authorized to make an order. But he need not make an order on that report. He may send that report hack. When it goes back once more you have the same situation.
I submit that that is not the sort of thing we have been aiming at in our efforts to ensure that the form of government known as democracy might succeed. Wherever there has been a struggle to obtain more money, whether from Governments or from other employers, it has always been found that an easy way to secure electoral support is to propose additional compensation or remuneration. Governments have to deal with that. I am sorry to say it requires a great deal of moral courage to withstand an appeal of that character when the result may mean that a dozen or fifty constituencies will vote in a particular way. That is a very serious matter. I had occasion once to say that the words of the great poet had fair application there:
"How oft the means to do ill deeds Make ill deeds done."
If the jurisdiction were not there, then the evil would not follow. The difficulty lies in clothing one man, a political Minister from necessity—
A NOBLE LORD: A trade unionist?
VISCOUNT BENNETT: I am not concerned with that at the moment. It is a political matter and a political Minister is charged with responsibility which involves the question of payments to be made to vast number of people throughout the Kingdom. I conceive that to be a very serious matter from the standpoint of the successful working of democracy. In one of the great Dominions—it was not Canada—a campaign was conducted in favour of larger allowances being made in one of the Social Services. Obviously the vote was in favour of it, regardless of what the effect might be upon the financial fortunes of that Dominion. So here, in this situation, you have a very difficult problem indeed for the Minister as well as for the public. I could tell your Lordships of a case that came under my observation in this Kingdom in which that very question was at issue. I was convinced then, as I am now, that the great thing for Parliament to do is to prevent the necessity of an individual Minister having to decide issues that are purely political in their character and which affect the great body of the public—that is, one Minister having this power and authority to deal with matters that affect the financial standing and even the solvency of enterprises. Either the observations he makes on the report of the Commission or the wages board are met or they are not, in which case you have a deadlock, which is fatal to the working of the Bill and in the end means that one side must give in to the Minister. That is the position.
There is another question about which the noble Viscount on the Woolsack and I had sonic discussion a few days ago. So profound is my regard for his legal knowledge and his capacity as a Judge, that even if he were presiding in the Privy Council, despite the observations that he has made, I should be quite content to argue the case before him and endeavour to show him he was expressing an erroneous view. That is saying a very great deal. The reason is to be found in three words. It is not unusual for Parliament to enact legislation with respect to the powers, authority, and responsibilities of boards and then follow that with a section declaring how these boards shall exercise their powers—in other words what factors shall influence them in
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arriving at their conclusions. Clauses 8 and 9 deal with the exercise of their powers by the various bodies that are set up, but when I come to Clause 10 I find there the rule that Parliament says shall govern these men in the exercise of their discretion. It is quite a common thing for Parliament to say that, in arriving at a conclusion as to a minimum, a body shall be governed by certain considerations, and that the exercise of its discretion will be the exercise of a discretion founded on and limited by the terms of the definition of the powers it has been given.
Let us look at Clause 10. There are only three words in it to which I wish to draw attention but I shall read it in order to make sense:
"For the purpose of determining whether the remuneration paid or agreed to be paid to a worker to whom a wages regulation order applies is less than the statutory minimum remuneration clear of all deductions, the net remuneration obtained or to be obtained by him in cash from his employer after allowing for his necessary expenditure, if any, in connexion with the employment shall, subject to the provisions of this section, be deemed to be the remuneration paid or to be paid to him—
Then follow these words:
"and the expression deductions ' in this Act includes deductions in respect of any matter whatsoever except deductions under the Income Tax Acts, the Unemployment Insurance Acts, 1935 to 1940, the National Health Insurance Acts, 1936 to 1941, or any inactment authorizing deductions to be made from the remuneration of a worker in respect of contributions to any superannuation or other provident fund, and except any deduction or payment authorized to be made under Section one, Section two or Section three of the Truck Act, 1896."
That subsection defines the meaning of the word "deductions." We cannot escape from it. Parliament has said to those in charge that they must make the finding "clear of all deductions" and then it says "deductions"—not in this section but "in this Act," so that wherever the word "deductions" occurs in this measure the meaning it has is the meaning given in this clause. If you turn to the words that come before you will find the words "clear of all deductions." What does that mean? It means clear of everything except what is mentioned here, for it says clearly "deductions in respect of any matter whatsoever, except …" Therefore gratuities and tips are not to be considered. There is distinct and positive

823
legislation against them because the meaning attributed to the word "deductions" is not in this clause as was indicated the other day by the noble Lord, Lord Nathan, and accepted by the noble and learned Viscount on the Woolsack. Whatever the word "deductions" means in this whole Statute it means that gratuities are not included in the deductions. So we have positive legislation in favour of gratuities not being considered, positive and definite legislation. If the clause had said, as was suggested the other day, "in this section," then of course you would have had another thing altogether, but the clause says "in this Act." Therefore, wherever the word "deductions" occurs in this measure I repeat that it means that you cannot deduct gratuities.
I submit that that is unfair. I am not going to repeat the argument. It really means that you have differences in the remuneration received by individuals in the same establishment when the whole effort of this Bill, as I understand it, is to provide for the opposite. There is legislative sanction to the obtaining of gratuities by all employees, thereby ensuring that the measure of their compensation or remuneration shall not be the same; yet the whole object, according to what was said by those in charge of the Bill, was to ensure that there was fairness and equality so far as remuneration was concerned for the same service and not, as will be the case now, that it should be subject to the caprice of the individual customer of the various establishments and subject to the popularity of the individual who receives the gratuities. One very popular person may receive a very large remuneration in the way of gratuities and another may receive very little. I submit that that is not what is intended by the legislation, and that the proposals that have been made to meet that situation should be carefully considered by the Government before we send forth to the world this legislation as the last word of a very difficult and complex problem.
I repeat that it is important to recall that, while the wages board and the Commission may both consider gratuities in making their proposals—I want to be perfectly clear about that; I put it the other day and was not understood—when you come to the use of the words "clear of all deductions" then the Bill says that
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there is one thing you do not consider and that is gratuities, because the clause says that "deductions" "includes deductions in respect of any matter whatsoever except" certain specified deductions, and that applies to every line of every section of this legislation. I offer your Lordships an apology for making any observations at all with respect to this legislation because I have lived here rather a short time and that disentitles me to make observations except on the broad and general policy of any legislation that may be submitted; but it is because I feel so strongly that this is unfair to the individuals concerned that I have ventured to trespass upon your time to the extent that I have.
VISCOUNT MAUGHAM: My Lords, I want to add a very few words only to what has fallen from my noble friends. I thought it was absolutely recognized as a principle that legislation should be clear and precise, and that as far as possible in regard to such a topic as the Catering Bill people should be able, after careful reading of it, to have a reasonably clear idea as to what the Bill is intended to do when turned into an Act; but I must say that having read this Bill several times, and having listened to what was said on the last occasion by the noble and learned Viscount on the Woolsack I am in the greatest doubt as to two things—first, what the Bill really means; and secondly, what its legal effects will be. It may be that I am stupid and cannot understand it, but really I cannot understand why Clause 10 should be drawn in the way in which it is drawn and what effect it is intended to have. I do not now understand from the Bill itself what is the intention in regard to tips. Who is to decide whether tips shall be abolished or not? In all these trades, or nearly all of them, tips are payable. It does not seem to me to be right. I think it is quite possible that the noble Viscount on the Woolsack, with his usual dialectical skill, can give an answer to my noble friend Lord Bennett which may persuade certain people that my noble friend Lord Bennett is wrong. As to that I do not know at all, but I do submit that what my noble friend has said at least has this result, that it is uncertain what this Bill does mean.
The Solicitor-General expressed an opinion in another place a short time ago

825
which may or may not be right. I do not know. I have looked into the question of the effect of the Truck Acts in this matter and I am in doubt now as to whether the people employed, or a large number of the people employed, in the catering trade are subject to the provisions of the Truck Acts or not. It was said by fie Solicitor-General that they are within the term "domestic servants." I have the greatest doubts whether that is correct. It may be so but I think it is very doubtful. Why should there be this uncertainty? Then was a question a short time ago in the case of Pratt versus Cook or Cook versus Pratt—I forget which name came first—in relation to the construction of Section 23 of the first Truck Act. The case related to a packer employed by a firm well known in the clothing trade in St. Paul's Churchyard, Messrs. Cook, Son and Co. The question was whether this man, employed as a packer for over fifteen years, had been properly paid during that period the amount of his wage, which was 53s. a week, because it was said as part of his wage in addition to the 53s. he was receiving dinner and tea which was reckoned at 10s. a week.
He was employed, as in many establishments all over the country similar people had been employed, on the footing that the Truck Acts did not apply to him. The case went first before one judge, next to the Court of Appeal, and then it came up here. I think my noble and learned friend on the Woolsack was not sitting on that occasion, nor was I, but the decision of the House of Lords, upsetting the decision of the Court of Appeal, was that this man was not being paid his full legal wage because there was an absence of an agreement in writing authorizing 10s. per week to be deducted from his wage for dinner and tea. That decision entitled the workman, who had all the time been quite content with his wage plus his dinner and tea, to claim 10s. a week for fifteen years, which was of course a very nice round sum.
Nosy this is what I want to say. There was no reason why such a thing should be left vague and uncertain. All over the country the view had been taken that people in his position were entitled to be paid their wages plus 10s. for dinner and tea, or whatever it might be in the particular case, and that that was a legal
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process which the employers had carried out. But so widespread was the view which the House of Lords, no doubt quite rightly, thought was wrong, although the practice had been in force for so many years, perhaps fifty years, that the Government had to introduce a Bill in the year 1940, which was the same year in which this case was decided, to say that such transactions up to the date of the Act would be deemed to be legal although there had been no contract in writing—that is to say, they had to re-establish the validity of the transactions during all these years as regarded the past. Of course it did not affect the judgment which had been obtained by this lucky individual Mr. Pratt.
I mention that for the purpose of showing how unwise it is to let things remain in doubt in a Bill of this character. If it was dealing with the intricacies of real estate or the construction of wills or something of that sort, I can understand the Minister in charge of the Bill saying: "Oh, this is a technical matter and we are advised that this has a particular effect and laymen are not to be expected to understand it." I do not agree that that is right even in those cases, but in such a matter as a Catering Bill, which concerns thousands and thousands engaged at weekly wages all over the country, and who are incidentally getting a great deal of their remuneration from the public in terms of tips, I cannot understand any real reason why the Government should say: "We prefer to leave it in doubt, we have been advised by So-and-so to a particular result and we ask you to take it as it stands." That resembles to some extent what, I think, is generally known as the confidence trick. It is a very good plan, no doubt, on the racecourse, but I cannot believe it is the proper course for a Government to adopt even in the course of a great war.
THE LORD CHANCELLOR (VISCOUNT SIMON): My Lords, I do not imagine the majority of your Lordships would desire this debate to be greatly extended—a debate on the Third Reading of a Bill already considered both in principle and detail—but out of respect for the three noble Lords who have addressed us, it perhaps is proper that I should say a few words on behalf of the Government before I put the question to the vote. I must say that I think there

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is a certain danger that the speeches that have been addressed to your Lordships may somewhat mislead those members of the House who have not themselves studied the Bill with the detail which, of course, those speakers have. Therefore I make a very simple observation about the Bill itself. The Bill itself is for the general purpose which for a quarter of a century or more has been served in certain other trades by the Trade Boards Acts. The first Trade Boards Act was passed in the first Parliament of which was a member, and I am sure my noble friend Viscount Samuel also remembers it very well. It was an Act which provided methods of settling rates of wages in trades where there was not any existing organization adequate for the purpose. It was criticized at the time. Some of the observations just made by my noble friend Lord Hemingford almost seemed to come from those debates. But the Act has worked smoothly for more than a quarter of a century and has become part of the regular friendly machinery of collective bargaining in whole sections of trade. I do not think at this time of day there would be many members of your Lordships' House who do not recognize that on the whole the system of collective bargaining has been an advantage and not a disadvantage to this country.
Now, my noble friend Lord Hemingford said he cannot see any reason for this Bill at present, though he was careful to add that it might be necessary after the war. But in this and some other matters, if things are going to be necessary after the war, there is something to be said for taking thought about them now. Post-war arrangements must in many cases be planned before the war ends. What is the catering industry? It is a very widespread, much divided form of employment engaging very large numbers of people, and it is one in which we are all agreed that after the war we hope to find a great and fruitful development. We shall want, probably, not only works canteens but we shall want restaurants and other institutions of the kind run satisfactorily to all concerned. We shall need to appeal to great numbers of workers to come into this industry. It is expected that many people who are now cooking for various units in connexion with the Forces will find their employment when the war is over in this indus-
828
try. That cannot be done, as it appears at least to the Government and, I hope, to others, unless there are reasonable and decent arrangements such as this Bill makes possible.
Of course if you object to the Trade Boards Acts, if you say it is entirely for the employer to dictate what wage he will pay, and that the other side has nothing to do with it but just to take what is given, then I can understand the objection. If, as I believe, most of the members of your Lordships' House recognize the value of collective bargaining, and if you further recognize the fact that no such machinery exists in many parts of the catering trade, well there is nothing very surprising in this Bill being carried. The main object of the Commission, which is outlined in Clause 2, is to inquire whether methods of regulating remuneration in various branches of the industry are, or are not, satisfactory and, if they are not, to make recommendations for setting up wages boards. There is nothing very revolutionary or very novel in all that. It has been done again and again in connexion with trade boards.
Then comes the other main criticism which my noble friend Viscount Bennett has very eloquently voiced to-day. He is of opinion that this is quite novel legislation. I think that I correctly caught his words and that they were to the effect that this was quite novel.
VISCOUNT BENNETT: I do not think I used the word "novel," my Lords.
THE LORD CHANCELLOR: I thought the criticism was addressed to the Bill on the ground that it was of a quite novel character. I will tell my noble friend the extent of the novelty. Under the Trade Boards Acts, as existing in this island for about a quarter of a century or more, no Commission but a Minister acts directly without the previous interposition of an impartially composed Commission. That is the extent of the novelty. If my noble friend, after the debate, will come to see me privately, I will give him some examples to show that at this moment in connexion with various trades in this country there are trade boards which act by reporting to the Minister, and the Minister makes an order. The novelty, if you call it novelty, is that having regard to the magnitude of the interests

829
involved and the difficulty of some of the questions, it has been thought wiser to set up, in the first instance, an impartial Commission which shall investigate these things as its primary function. Subsequent steps, reporting to a Minister, conferring, the ultimate making of an order, are all steps which are perfectly familiar in this island in connexion with the settling of such things as rates of wages by trade boards.
I will not venture to enter into further controversy with my noble friend Viscount Bennett on his view about whether or not it is open to the wages board under Clause 8 to consider whether a branch of the industry is extensively tipped. I venture respectfully—since my noble friend has no belief that I am right—to invite him to confer with my noble and learned friend Viscount Maugham, in some quiet moment, because I do not think anybody who really reads the Bill with the authority with which some people can read it, can have the slightest shadow of doubt on the subject. It is merely because my noble friend will look at Clause 10 and not at Clause 8. If he will reverse the process he will, I think, arrive at a' different conclusion. My noble friend is perhaps something like Athanasius. If there was anything at all to be said against Athanasius it was that he was perhaps a trifle obstinate in sticking to the opinion which he had first formed.
The question remains as to whether we should all set one another examination papers about this. I am only concerned as to who my examiner is to be. Lord Hemingford, I think, does appreciate that I was correct in what I said about Clause 8 on the Committee stage. I thought everybody understood it now, but, apparently, there are exceptions. Let us, if you will, after meditating in the watches of the night upon this legislation, endeavour in perfect good temper to devise questions for each other to answer, but let us recognize that this is a Bill which is endeavouring to bring about a valuable reform in respect of an immense service which at present, for the most part, as to its wages, is quite unregulated by any process of collective bargaining, and let those of us who believe that, under proper regulation, collective bargaining may be a good thing, persuade ourselves that even this new departure is one which will confer a benefit on the
830
country. For the rest we must wait and see how it goes.
I am sorry that everybody is not quite persuaded of the virtues of the Bill. In these matters we can only do our best and do what we think right. I will not deal with the point raised by my noble friend Viscount Maugham about the Truck Act or the interesting account which he gave of a recent decision of the House of Lords. I hope to be able to show, in the discussion on an Amendment that is to be moved after the Third Reading, that there is very good reason why we should not adopt that Amendment. And now, unless any other noble Lord wishes to raise some point, I will put the question.
VISCOUNT BENNETT: The noble and learned Viscount who sits on the Woolsack was good enough to refer me to Viscount Maugham, advising me to have some private conversation with him. May I say that I have known Viscount Maugham for many years and I can testify that statements which he has made to me in private have always agreed wholly with his public utterances?
THE LORD CHANCELLOR: I can only say that in my view Lord Maugham has expressed a contrary view to Lord Bennett's with regard to Clause 8. Let me clear up this matter now. If Viscount Bennett will refer to the Official Report of the debate in Committee on Thursday, May 20, he will see, at the bottom of column 608, these words which were uttered by Lord Maugham:
"I agree, and I have already stated that I agree, with the Lord Chancellor that under Clause 8 (1) any mortal thing, relevant or irrelevant, might be considered by the people who were fixing the remuneration to be paid by the employer …"
Then he went on to say that what he was interested in was providing that it should be considered. I can assure my noble friend that there is no doubt amongst those who have been constantly concerned with these things as to the effect of the clause. After all, the Bill was, in the first instance, very carefully considered by the draftsmen, by the Law Officers, and by some other people who know a little about law. I hope that he will not lie awake at night thinking about this unhappy point.
LORD MORRIS: My Lords, perhaps I may be permitted a word before this Bill

831
finally goes on to the Statute Book. I said something about it on the Committee stage, and, for the benefit of those of your Lordships who were not here on that occasion, I may say that there was a difference of opinion between the noble and learned Viscount on the Woolsack and the noble and learned Viscount, Lord Maugham. We had the somewhat (to my mind) unedifying spectacle of the Lord Chancellor of Great Britain sitting on the Government Benches and defending, with a certain amount of acrimony and heat, this highly debatable Bill. The noble and learned Viscount, Lord Maugham, whom I, as an infant lawyer in this House, consider to be one of the greatest jurists of his day, differed from the Lord Chancellor on the interpretation of certain clauses of the Bill. It does not seem to matter in the least which of the noble and learned Lords is right, nor does it matter what the degree of their difference is; what does matter is that they differ at all, that they could differ, and should differ. Surely before a Bill of this character is drafted and presented to your Lordships, and above all before it goes on the Statute Book, there should be attached to it a sufficient degree of clarity and certainty to avoid the vexatious litigation which those best qualified to know have assured your Lordships in terms will follow from the passage of this Bill in its present form. You have for that the word of the noble and learned Viscount, Lord Maugham, and of a former Deputy Speaker of the House of Commons, himself a lawyer, and of others qualified to speak on these matters.
It is true that the noble and learned Lord Chancellor tells your Lordships that the Bill has been considered by draftsmen and lawyers, and that they have all liked it, but the noble and learned Viscount on the Woolsack is not in the position of the Speaker of the House of Commons, because on a matter of this kind he speaks as a member of the Government, and may well be forgiven for taking a paternal interest in this Bill. It is euphemistically termed the "Catering Wages Bill," but is to a large extent the child of Mr. Ernest Bevin, the sometime General Secretary of the Transport and General Workers' Union. It is a Bill to take away from the catering industry, who have done their work to the universal satisfaction of the catering trade and of the country for at
832
least half a century, the control of their business, and put it into the hands of the bureaucrats, of whom we are getting so heartily sick; so that naturally the Bill commends itself to the noble Lords on the other side of the House, and I was not in any way surprised to hear them supporting it. I suppose it is going to have its Third Reading, but, before it does so, I want to record my emphatic protest against its passage, against its draftsmanship, and against the Government handling of the Bill in this House and in another place throughout its unfortunate history. I think that the episode in the House of Commons when Sir Douglas Hacking withdrew an Amendment on the assurance of the Solicitor-General that certain words and certain phrases in the Bill had certain meanings, which we are now told they have not, is a piece of political skullduggery and chicanery which has not been equalled or a very long time, and I do not mind going on record as saying so.
On Question, Bill read 3.
Clause 2:
General functions of the Commission.
2.—(1) The Commission—
(a) shall make such inquiries as they think fit or as they may be directed by the Minister to make into the existing methods of regulating the remuneration and conditions of employment of workers to whom this Act applies, and into any other matter affecting the remuneration, conditions of employment, health or welfare of such workers;
LORD ILIFFE LORD ILIFFE moved, after subsection (1), to insert:
"(b) shall make such inquiries as they think fit or as they may be directed by the Minister to make into means for meeting the requirements of the public, including in particular the requirements of visitors from overseas, and for developing the tourist traffic."
The noble Lord said: My Lords, I beg to move the Amendment which stands in my name. This Amendment takes the place of one which I moved during the Committee stage. Its purpose is to emphasize the need for considering the interests and convenience of the public, and especially of our visitors from overseas, in regard to any regulations governing wages, working conditions, and so on which may arise as the result of this Bill. I do not propose to reiterate the importance of attracting tourists to this country after the war, as I dealt with

833
that at some length when I spoke on the Bill in Committee. The Amendment which I then moved was, I think, generally acceptable, at all events in principle, to your Lordships, but my noble and learned friend the Lord Chancellor said that he felt that I had chosen the wrong place in the Bill for its insertion. He promised, however, that the inclusion of suitable words, to be inserted in a more appropriate place, would receive consideration before the Bill left your Lordships' House. The present Amendment is the result of such further examination. In moving its adoption, I do so in the high hope that it will be accepted; and, in that belief, I should like to thank the noble Lord, Lord Snell, who is in charge of the Bill, and the noble and learned Viscount on the Woolsack, for implementing so fully the promise which they then made to me and to the House. I beg to move.
Amendment moved—
Page 2, line 14, at end insert the said new paragraph.— (Lord Iliffe.)
THE EARL OF BESSBOROUGH: My Lords, I desire very briefly indeed to support the Amendment which my noble friend Lord Iliffe has moved. As my noble friend has explained, the arguments for it were fully gone into during the Committee stage, when the noble and learned Viscount on the Woolsack undertook to examine where such an Amendment should be made. I wish only in a few words to recall that, when this Bill was first forecast, it was proclaimed by the Government spokesmen as a charter for the tourist traffic. I can still remember the headlines to the inspired articles in the Press. But then the Bill was introduced and printed, and we found that from the first word to the last the question of the tourist traffic was never mentioned at all; it was simply a Bill for regulating wages. Both in another place and in this House, members of the Government have vied with members of Parliament in emphasizing the importance of looking after the tourist traffic after the war. I am very glad to think, therefore, that my noble friend Lord Snell, who, I know, so much regretted not being able to meet us on our Amendments on the last occasion, is now going to have the opportunity which he so much desires.
LORD JESSEL: My Lords, before the noble Lord replies I should like to support what has been said about this
834
Amendment. I am one of those who fought very strenuously for it, and I told the Government at the time that they were extremely unwise to be so hardhearted as not to allow any Amendments on this Bill. There has now been a change of heart, thanks to the intervention of the noble and learned Lord Chancellor, who at once diagnosed that there was considerable feeling on this side of the House, especially as regard this subject. I should like to congratulate my noble friend Lord Snell on receiving the distinguished honour which we all were glad to read in the Press the other day that he had received. I am sure that his conduct in charge of this Bill has had something to do with the reception of that honour.
LORD SNELL: My Lords, in order to remove as quickly as possible any anxiety which there may be in the mind of my noble friend Lord Iliffe, I will tell him at once that I propose to accept his Amendment. The effect of it will be to make it clear on the face of the Bill that the Commission is supposed to make such inquiries as they think fit into "means for meeting the requirements of the public, including in particular the requirements of visitors from overseas, and for developing the tourist traffic" as a whole. It also makes it clear that these are particularly matters on which the Minister may be instigated to direct the Commission. In the discussion which took place on the Amendment dealing with this subject on a previous stage of the Bill, there-was no difference of opinion between the Government and the supporters of the Amendment as to the outstanding importance of this matter. The Government objection was based primarily on the fact, as has been stated, that the Amendment was put down in the wrong place. It was also felt that to single out one subject, however important it might be, for special attention might prejudice consideration of other very important matters and might necessitate the insertion of a whole Schedule of subjects for consideration by the Commission.
The noble and learned Viscount the Lord Chancellor, however, after hearing the views that had been expressed, undertook to have this matter looked into at a later stage. Careful and sympathetic consideration has been given to the whole question in relation to the present Amend-

835
ment, and the Government are satisfied that this Amendment adequately and effectively meets the point of view expressed so unanimously in the debate in Committee, without giving rise to embarassing consequences. The Amendment seems to the Government to be now in the right place. It is the Commission who can take a wide view of the subject as it affects the whole industry, and in just that part of it which may at any time be included in the field of a wages board.
Furthermore, there is no certainty that a wages board will be set up for any particular section of the industry. The question of setting up a wages board is a matter which will need very careful examination by the Commission after a review of any existing machinery for regulating wages. The Amendment also draws a distinction between persons coming to this country as visitors from overseas and the tourist traffic, and this to His Majesty's Government seems to be right. In the former case individual attention is necessary, in the latter case what is needed is adequate and attractive arrangements for dealing with the movements, the reception, and the catering for organized parties. The Government are anxious to do everything that they can to develop this tourist traffic. Their interest in this most important work is demonstrated by the fact that since April, 1929, they have given financial support to the Travel and Industrial Development Association of Great Britain and Ireland, of the Finance Committee of which my noble friend Lord Iliffe is the Chairman. During the war, of course, the activities of the Association have been virtually suspended, but the Association is at the present time preparing post-war plans designed to encourage a greatly increased flow of visitors to this country compared with what has been the case in the past.
It is not in any way intended that the Commission should usurp the functions of the Travel Association, though both will, under this Amendment, be working towards the same end. My right honourable friend the Minister of Labour, appreciates the work which has been done, and will be done, by the Association, and has undertaken that it and the associated body in Scotland will be taken into full consideration to insure against any danger of overlapping. The only thing that remains
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for me to say is that, having regard to the obvious strength of opinion in favour of the Amendment, the Government have decided to accept it, and in doing so they also endorse the view that a Bill designed to encourage visitors from overseas and the development of the tourist traffic should contain a specific reference to these matters. It only remains for me to thank all those who have taken part in the discussions for the suggestions they have made, and I have pleasure in accepting the Amendment.
On Question, Amendment agreed to.
THE LORD CHANCELLOR: The next Amendment is consequential.
LORD ILIFFE: My Lords, I beg to move.
Amendment moved—
Page 2, line 18, at end insert ("or with respect to any such matter as is mentioned in paragraph (b) of this subsection").—(Lord Iliffe.)
On Question, Amendment agreed to.
LORD HEMINGFORD LORD HEMINGFORD moved to add to the clause:
"(3) In this section remuneration of a worker shall be deemed to include all cash received by the worker in connexion with and directly as a consequence of his employment, whether paid by the employer or otherwise."
The noble Lord said: My Lords, I call your Lordships' attention to the fact that this is an Amendment to Clause 2, which deals not with the wages boards but with the Commission. The business of the Commission is to look into matters generally connected with the remuneration of the persons concerned, and possibly to make recommendations which may result in the setting up of a wages board. It is therefore before we come to the position of the wages board at all that I ask that these words should be inserted. It may be answered that they are unnecessary, but in the remainder of the Bill, or the greater part of the remainder of the Bill, wherever remuneration is referred to it is expressly described as remuneration payable by the employer. This, of course, deals again with the question of tips or gratuities. My hope is that the Government will make it quite clear by accepting this Amendment that the Commission in their original consideration of the position of the industry, or that part of the industry which they are inquiring into, should clearly and obviously be entitled to inquire into and

837
to consider the remuneration received directly in connexion with the employment, whether it is received direct from the employer or some other person, that is to say, from customers.
I do not think it is any use my moving the other Amendments standing in my name, which have regard to tips, and perhaps I may be allowed to say what appears to me to be the position of the Bill on those. Assuming for the purposes of argument—I am not going to try and judge between the eminent lawyers who have given opinions on the subject—but assuming for the purposes of argument that Clause 8 does allow the wages boards to take tips into consideration, Clause 10 certainly does not allow them to be treated as deductions. The actual result, therefore, is that if they are considered under Clause 8 the only way in which that consideration can be made use of and made effective would be for the statutory minimum wage to be fixed at a negligible amount because of the very large amount which a particular class of attendant is receiving in tips. I cannot for one moment imagine that that would be done, and therefore, if I am right in that, it is quite clear that when it comes actually to fixing the statutory minimum remuneration tips must be left out. However, as this is, we are told, a Bill for the development and improvement of the industry generally, I still have almost more than a lingering hope that the Government will accept this Amendment, in order to ensure that the Commission, before the wages board comes into existence, may consider the entire remuneration received in connexion with his employment by the employee, whether that remuneration comes from the employer or whether it comes in the form of gratuities from others.
Amendment moved—
Page 2, line 30, at end insert the said new subsection.—(Lord Hemingford.)
VISCOUNT MAUGHAM: My Lords, I beg to support this Amendment because it tends to clarify the measure. That is sufficient ground for my support. I also wish to say one word on a subject which I confess I regard as of very little importance at the present time, and that is the construction I put on this Bill as it stands. I have been a Judge for many years, and I like, before determining any question of difficulty regarding the construction of a Statute, to hear it argued
838
on both sides; but I take leave to observe that I am not aware that in private I have expressed any opinion about this Bill which is not precisely the same as that I have expressed to the House. I take a very strong view that if anybody speaks in this House, more particularly a person with a legal training, he is absolutely bound to express precisely what is his true belief as regards the words he uses.
Now let me say this. Clause 8 is, as my noble friend Lord Hemingford has said, the clause that deals with the wages board and its power to submit proposals to the Minister. I agree, and I repeat what I said before, that inasmuch as there is nothing to prevent the wages board considering any matter—I gave the fantastic illustration of the colour of the girl's complexion—so they can consider whether tips are being paid to these employees or not. I therefore think that under Clause 2 the Commission, since they can make such inquiries as they think fit into the existing methods of regulating the remuneration and conditions of employment of workers, might, prima facie, look into any matters affecting remuneration. I am not sure that here I am entirely in agreement with my noble friend Lord Bennett, but it makes very little difference in my opinion to the result of what I have to say. They might therefore consider the fact, which would stare them in the face, that the bulk of the remuneration of the employees in question consisted of tips given to them by the public.
At the same time I am of opinion that neither the Commission nor the wages board respectively, under Clause 2 and Clause 8, need look into these matters if they do not wish. When we look at Clause 10, with the parts to which my noble friend Lord Bennett so forcibly referred, and have regard to the fact that deductions throughout the Bill are to be deductions as therein defined, there is a kind of hint given both to the Commission and to the wages board, if they are set up, not to pay any attention to tips since, if they do, they will not form part of the minimum statutory remuneration. I am not saying that on a true construction of this Bill it may not be the case that tips can be considered. If they are considered by the wages board the statutory remuneration will be just what the board thinks fit, having considered the fact that there are tips. Then that sum which may be

839
as much as, or so much less than, the salary payable to the employees at that time, becomes their statutory remuneration, and if the employers do not pay it they are liable to the serious penalties set out in the Bill.
I repeat what I have said before, and that is that this is not the right way to deal with this question. The public, the employees, and the employers ought to know where they stand. It ought not to be left to some unknown people, appointed we know not how or under what circumstances, to determine whether they should shut their eyes to tips or keep their eyes wide open and realize that the girls, in ordinary catering establishments, are paid largely by tips. If the question is to be decided that there are to be no tips in future, it ought to be determined after an inquiry; and it is not a very extravagant idea that the employees themselves should be consulted so that we may know whether they want the abolition of tips or not. It ought not to be left to a few public servants, or whoever they may be—persons who are not responsible to Parliament—to determine a great question of that sort without any public inquiry or without the Legislature having a voice in the matter. In substance I would say that I do not quarrel with what my noble friend Lord Bennett said, except on a very small point, and I would also say that substantially I agree that the probable meaning of this Bill is that which my noble friend Lord Hemingford has put upon it. I do not see why the question should be left in any doubt, and the position would be rendered a little bit clearer if this Amendment were accepted.
VISCOUNT ELIBANK: My Lords, I hardly like to venture into a discussion with learned Lords who have practised the law all their lives. I do so only as a layman because I believe that the arguments put forward by my noble friend Lord Hemingford are entirely convincing. Secondly, I do so because I agree utterly with the views expressed by the noble and learned Viscount who has just sat down. He has explained to your Lordships that, in his view, this Bill is not clear in its intentions. I do not see why this House should part with a Bill in respect of which even the lawyers are not content to be in agreement with each
840
other. If the lawyers disagree, how can the layman understand? This is an occasion upon which the Government ought to change their point of view and put in this small Amendment, which will apparently make the situation quite clear. They should not allow a Bill to be passed which, as far as one can understand, will mean continual reference by employers and others to the Law Courts, and lead employers into a great deal of expense apart from the main issue involved in it. For these reasons I beg to support my noble friend Lord Hemingford.
LORD NATHAN: My Lords, I feel very unwilling to engage in a struggle between legal luminaries, being myself but a leaf from a lower branch. I am not at all certain that the noble Viscount, Lord Elibank, is correct when he says that if this Amendment were adopted it would make the position any clearer. I am not at all certain that this Amendment is so crystal clear that it might not open the way to a similar discussion. My noble friends on whose behalf I speak hope that the Government will reject this Amendment on grounds that are based, not upon legal niceties, but upon a question of principle. We hold, incidentally, that the Bill is clear in its provisions and that it is open to the Commission to take into account, as I think the noble Viscount, Lord Maugham, has said, any matters that they consider relevant to those subjects coming within their purview.
The objection which my noble friends take to this Amendment, as I ventured to say in the course of the Committee stage when a very similar matter arose, is that by this Amendment, if it were accepted, Parliament would legitimize, or at least would be recognizing, the practice of tipping, whereas my noble friends hold the view that even if tipping cannot be prevented by Act of Parliament, which may very well be the case, there should be created a public atmosphere and temper in which tipping becomes unfashionable and even disreputable. That view, which my noble friends hold, would certainly be incapable of finding expression in fact if Parliament were to give its authority to the practice of tipping. In those circumstances I hope that the Government will stand firm in resisting this Amendment on the grounds both that the Bill in its terms is clear and that the Amendment itself

841
has implications, which would require far greater consideration than this Amendment gives the opportunity for.
THE LORD CHANCELLOR: My Lords, I can briefly state the view of the Government on this matter, which indeed was raised in Committee. I did not understand when Lord Hemingford first addressed us on Third Reading that he was really pressing this Amendment, but be that so or not the position of the Government is quite clear and simple. We are not prepared to see put into this Bill provisions which treat the system—on the whole the objectionable system—of tipping as though it were something approved and sanctified by the Legislature. We cannot, of course—nobody can—prevent here and now the giving of tips in many connexions. But there is very considerable effort being made in the hotel trade to establish a better system and that effort ought to be encouraged in every way. The tronc system now obtains in many places and in many hotels. This is a system whereby an addition is made to the bill—ten per cent. or whatever it is—and this is taken collectively for the purpose of being distributed among the employees. It is a far better system than the system in which a rich man, by slipping an unusually large tip into the paw of somebody who is to give him attention, secures the best service. I do not really think there can be two opinions about the undesirability of that.
I am perfectly aware that by resisting this Amendment we do not abolish that system, but if we put this Amendment in then we are, in the very Bill which is endeavouring to secure better regulations in the catering trade, treating tips as part of the necessary established authorized routine. That the Government are not prepared to do. Therefore what we have done in this Bill—and here I will now speak dogmatically—is this. So far as fixing the remuneration is concerned, it is the remuneration that is to be paid by the employer to the person employed. You cannot fix the size of the tips to be given to an employee by means of a wages board or a Commission. So as far as a question of regulating remuneration is concerned it is regulating the remuneration to be paid by the employer to the employee, and, as was pointed out by my noble friend Lord Nathan, and is plain to anybody who will look at the
842
Bill calmly and without heat, the Commission may also look into "any other matter affecting the remuneration or conditions of employment."
One of the things that unquestionably may affect remuneration is this very system of tipping, and one knows that there are certain positions held by people in which the fact that they are likely to get considerable gratuities is a consideration which may affect the amount of wages they get. We cannot alter that here and now, but there is not the least doubt in the world—I state it with great-respect to the House but categorically— that under these words any other matter affecting the remuneration the Commission is empowered to consider. In the same way, later on, in the wages board clause, Clause 8, they may do so. I have to say that, having considered this with great care and I believe with real impartiality, we have come to the conclusion that it is not a service to the catering trade to insert these words, and that it is not right to put into this Bill in black and white statements that these things must be taken into account.
The true position is—I hope I shall be forgiven for stating it again—that the wages board may consider it in fixing what is the amount of remuneration to be paid by the employer. That has been explained many, many times and nobody explained it better or more clearly than the noble Lord, Lord Nathan, in Committee. But we are opposed to putting in this specific statement because it would amount to a discouragement of the gradual development of this new system, which is a far better system, because it means that the individual guest cannot secure for himself by the use of money a service which ought to be rendered equally to all concerned. I hope that noble Lords will feel, as I am sure many of you must feel, that this is a disagreeable position to be put in, and that it is even more disagreeable for one's wife who has to say ''How much should I give the chamber maid?" or "How much ought I to give the porter?" Anyone who cares about the development of this industry, as your Lordships do, would, I am sure, wish to see this system not encouraged, but discouraged, and therefore I will ask your Lordships to reject the Amendment.
LORD HEMINGFORD: My Lords, may I be allowed to correct my noble and learned friend with regard to one remark he made about my Amendment? This Amendment does not say they must make allowance for these tips. It merely is intended to define those things which they may take into consideration, and I have already said that I consider the answer may well be made that they already have that power. I only wanted to insert these words for the purpose of making it clear that they really had got power to take these tips into consideration and not for the purpose of making use of them to affect the remuneration to be paid by the employer; and also, if necessary, for doing what the Lord Chancellor suggests—namely, that tips should be discouraged. Really I think his answer to my Amendment, or what was suggested as the answer to the Amendment, was entirely off the Amendment itself.
THE LORD CHANCELLOR: If I may be allowed to say another word my noble friend is really under a misapprehension. If he looks at Clause 2 (1) to see where the word "remuneration" comes in, I think he will understand that his Amendment is open to the criticism I made. The word "remuneration" comes in line 10, and the Commission are to make inquiries "into the existing methods of regulating the remuneration and conditions of employment of workers to whom this Act applies." Surely no one can suggest that there are "methods of regulating" tips. This is not the relevant place. The place where it comes in is "into any other matter'' and I venture to advise that that does include tips.
On Question, Amendment negatived.
Clause 4:
Establishment of wages boards.
4.—(1) If the Commission are of opinion, as respects any workers to whom this Act applies and their employers, that such machinery as aforesaid for regulating those workers' remuneration and conditions of employment either does not exist or is not, and cannot by any improvement which it is practicable to secure be made, adequate for the regulation thereof, the Commission may make a recommendation to the Minister (hereafter in this Act referred to as "a wages board recommendation") for the establishment of a wages board in respect of those workers and those employers.
THE EARL OF BESSBOROUGH THE EARL OF BESSBOROUGH moved in subsection (1), after "thereof," to insert "or that the employers are unable
844
to satisfy the Commission that they will provide for workers in their employment remuneration and conditions of employment at least equivalent to those prescribed under any wage regulation order (as hereinafter defined) in force under this Act and applicable to similar workers."
The noble Earl said: My Lords, having found my noble friend in a melting mood this afternoon I move again the same Amendment as I moved during the Committee stage. It is not exactly in the same words, because I have tried to make the Amendment a little clearer in its terms than perhaps it was before, for reasons which I will explain to your Lordships in a moment. I move the Amendment again for two reasons. The first is because on the previous occasion I ventured to ask my noble friend Lord Snell whether the Government would be good enough before a further stage to consider the point I was endeavouring to make—without committing myself to the words of the Amendment on the Paper—and in reply Lord Snell said he would refer my request to the Minister and to the Government as he could not personally give me the promise asked for. By moving this Amendment again I am giving an opportunity of further consideration by the Government of my Amendment. My second reason for moving it is that, as I have just hinted, I am afraid I completely failed to make the purpose of it clear in so far as the noble Lord who replied to me on behalf of the Government is concerned.
In his reply to me Lord Snell quoted me as saying that "some rates above any possible minimum could be roughly insured in certain cases." With great respect, my Lords, that does not in the least represent what I said, which was
"that there are some sections of this industry—''
not certain cases—
"…in which rates of remuneration and conditions of employment are certain to be continually above any minimum standard which may be fixed."
And I added that
"they could be guaranteed to be maintained above that standard.…"
Again my noble friend Lord Snell said later on that he remembered
"a case where it was said that a whole city might be saved if there were ten righteous men in it."

845
My noble friend then went on:
"I do not know whether you can spare a whole industry from the inconvenience of regulation because there are some particular groups in that industry who would do justice to the workers in this respect."
Again, with great respect, I never said or hinted or suggested for a moment anything of the kind. I never suggested, and never would suggest, that the unrighteous should be spared for the sake of ten or any other number of righteous men.
I never did say or think for a moment that a whole industry should be spared because some groups would do justice to the workers. What I argued was that large sections of the industry do maintain and guarantee to maintain rates and conditions above any possible minimum, and that they should not have regulation imposed upon them since the object of the Bill was already achieved in their case. Let me take as an example the hotel industry. We speak of the catering industry in the singular, but it is more correctly put in the plural because the catering industry is not one but many. I say that because one section of the industry, the hotel section, has time and time again in Acts of Parliament been recognized as an industry in itself. I have here a report of an inquiry carried out by the Government into remuneration and hours of employment in the catering trade which was published in 1930. Summarizing that report, it was found at that time by the Government that 75 per cent. of the adult males and well over 70 per cent. of the adult females in hotels earned in total remuneration more than the highest trade board minimum fixed for their section of all the other forty-four industries dealt with. This report was published more than ten years ago and it is well known that remuneration in this business has increased very considerably since that time. I am not referring merely to war increases but to increases regularly taking place before the war There, at any rate, are the figures as proclaimed by the Government on the latest occasion on which the industry has been inquired into.
When I moved the Amendment on the Committee stage I pointed out that as Clauses 3 and 4 were drafted the test upon which a wages board was to be imposed is whether or not machinery exists for regulating remuneration and not whether rates and conditions are satisfactory or not. It is perfectly true that
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these two clauses say "may" and not "must," but I do not require to go into the argument of "may" and "must" because "may" follows on the existence of machinery and not on the existence of unsatisfactory conditions. I hope the noble and learned Viscount on the Woolsack will not have to correct me in making that statement. I should like to add that I am sure it is not the intention of the Government to impose regulation merely for the pleasure of imposing it for its own sake. We all know the need of it in many cases, and where there is a satisfactory reason for regulation we all accept it.
It may be said—I think it has been said—that good employers have nothing whatever to fear from this Bill. That is no doubt perfectly true, but why set up elaborate and expensive organization in order to obtain a purpose which has already been achieved? The principle of the Trade Boards Acts, as I understand it, is that regulation should follow on unsatisfactory rates and conditions and not on the existence or otherwise of machinery. I move my Amendment in the full belief that in doing so I am following the principle adopted by Parliament for many years. When I moved it on the previous occasion I was so fortunate as to receive a great deal of support from your Lordships, and I hope that on this occasion I may also receive some encouragement from my noble friend Lord Snell.
Amendment moved—
Page 3, line 18, after ("thereof") insert ("or that the employers are unable to satisfy the Commission that they will provide for workers in their employment remuneration and conditions of employment at least equivalent to those prescribed under any wage regulation order (as hereinafter defined) in force under this Act and applicable to similar workers".)—(The Earl of Bessborough.)
LORD SNELL: My Lords, I deeply regret that I cannot be so accommodating in regard to this Amendment as in the previous case of the Amendment of my noble friend Lord Iliffe. The purpose of the Amendment is presumably to prevent the Commission from recommending a wages board that would include undertakings in the control of employers who can satisfy the Commission that they will provide for the workers in their employment remuneration and conditions of employment at least equivalent to those

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provided under any wage regulation order in force and applicable to similar workers. "Similar workers" can only mean similar workers in comparable establishments and working under comparable conditions. There is, for instance, very little similarity between a cook, let us say, in a luxury hotel and a cook employed at a holiday camp. The term "similar worker" would be most difficult to interpret in an industry with such diverse conditions.
In the discussion which took place on the Committee stage it was made clear that, in the Government view, the only voluntary machinery that can be regarded as satisfactory for regulating wages and conditions of employment, is that based on the Whitley principle of collective bargaining to which both sides of the industry are parties. The Amendment now under consideration does not attempt to meet that objection. It asks the Commission to remember only the employer. The attitude of the Whitley Committee on this point is worth while remembering. They stated in their second Report that:
"We think it advisable in this connexion to repeat the following paragraph from our former Report:
"'It may be desirable to state here our considered opinion that an essential condition of securing a permanent improvement in the relations between employers and employed is that there should be adequate organization on the part of both employers and workpeople. The proposals outlined for joint co-operation throughout the several industries depend for their ultimate success upon there being such organization on both sides; and such organization is necessary also to provide means whereby the arrangements and agreements made for the industry may be effectively carried out.' "
Your Lordships will see that what is regarded as an essential by the Whitley Committee is not met in the Amendment before your Lordships' House.
It is true that the employers' guarantee, whatever form it takes, will be based upon a regulation order that will have been recommended by a body of representatives of workers as well as employers. But it relies upon a wages board to provide a standard. In effect, therefore, the Commission are being asked to say that when recommending the wages board they will also recommend that certain specified employers should be excluded because the Commission are satisfied that those
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employers will observe the terms of the statutory regulations. This, in the view of the Government, is an impracticable proposition. The statutory regulation must be based on the assumption that those to whom it applies will observe it. Indeed it is safe to say that it is only the exceptional employer who will not observe a statutory obligation. It seems wrong, therefore, in the view of the Government, to attribute any special virtue to an employer simply by reason of the fact that he guarantees to observe a wage regulation order that should properly apply to his establishment.
The question arises, finally, as to why employers should seek to avoid being included in the wages board. It is probably because they desire to avoid the inspections that are a necessary complement of statutory regulations, but it could not properly be expected that, just because some employers give a guarantee, there should be no check whatever to see that that guarantee was being implemented. Joint deliberations of the nature that I have suggested have proved to be of inestimable value to the industry as a whole, and the Bill proceeds on the assumption that there is virtue in such joint machinery, whether such machinery is voluntary or statutory. The Amendment implies a contrary view. In the view of the Government this Amendment is contrary to the fundamental principles on which the Bill is based and I very much regret that, on behalf of the Government, I am not able to accept it.
On Question, Amendment negatived.
LORD HEMINGFORD: I do not propose to move the other Amendments standing in my name.
Clause 10 [Computation of remuneration]:
LORD TEVIOT LORD TEVIOT moved, at the end of the clause, to insert:
"(4) For the resolution of doubts it is hereby declared that servants in boarding houses, hotels and public-houses, other than those wholly or mainly engaged in clerical duties, and kitchen staffs, cleaning staffs, waiters and waitresses in cafés and restaurants are domestic servants within the meaning of the Truck Acts, 1831 to 1940."
The noble Lord said: My Lords, it is with some trepidation that I step into what appears to me to-day to be almost the Law Courts. But I am reinforced by what I may possibly term a cocktail,

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having studied the few words that fell from the lips of the noble and learned Viscount who sits on the Woolsack in the last debate, in the course of which he said:
"What is the attitude of the Government in regard to this admittedly complex question, which no doubt does at times raise difficulties?"
I feel very much reinforced by that remark, and, therefore, I propose, before moving the Amendment, to address a few words to your Lordships with your consent. I do not intend to go over ground which was; traversed in the last debate on the Committee stage of this Bill. Unfortunately I was not able to be present then. But in view of what transpired on that occasion, I propose to move the Amendment which stands in my name.
I must, I am afraid, ask for a little indulgence from your Lordships in regard to the reading of some of the remarks which I am going to make. This is a highly technical matter, and you have heard from my noble and learned friend who sits on the Woolsack that he realizes the difficulties that beset one in speaking upon it. I hope, therefore, that, as I am a complete layman, you will permit me to read some of my remarks.
My friends who are interested in this subject—and there are many of them throughout the whole country—are advised by eminent legal men that there is grave doubt as to the categories of servants in the catering trade who respectively are subject and are not subject to the operation of the Truck Acts, 1831 to 1940. The question depends on two main factors—whether the servants are "workmen" within the definition contained in Section 10 of the Employers and Workmen Act, 1875, or whether they are domestic servants, who are excluded from that definition. There is great uncertainty as to what constitutes a domestic servant, as it is not clear whether this is to be tested merely by the nature of the work done, or whether regard must be had also to the nature of the establishment in which the work is done, that is to say, whether work can be domestic if it is not done in a domestic establishment, even ill when exactly the same work is done in such an establishment it would be clearly domestic. For example, a parlourmaid in a private house is clearly a domestic servant; if she transfers to a restaurant, where she does the same work, does she remain a domestic servant?
The importance of this matter from the point of view of the practical conduct of catering is due to the fact that meals cannot be given to employees subject to the Truck Acts as part of their wages unless they enter into a written contract authorizing the deduction of the value thereof from their cash wages. We all know that; there has been a celebrated case which your Lordships will have in mind with regard to this matter, where a very heavy penalty was inflicted. As the practice of giving meals as part of wages is almost universal in the catering trade, and essential, for obvious reasons, in the case of persons working in establishments where food is prepared and consumed, it is vitally important that a wages board should have no difficulty in making clear and certain any orders relating thereto.
The whole matter has rather puzzled my friends, having regard to what was said by the Solicitor-General in another place and to what fell from the noble and learned Viscount on the Woolsack here in the course of the debate during the Committee stage. I shall not weary your Lordships by reading what both of them said, but it is conceived that, as the Amendment as now drawn avoids the only specific objection which the Lord Chancellor was able to bring against it in its original form, and reconciles his view of the law applicable with that of the Solicitor-General, the Government should now accept this Amendment as being merely declaratory of what the law is. It would be most unsatisfactory both for the wages boards and for all engaged in the catering trade if this matter has to be left for the elucidation of extensive litigation.
I am sure we all feel that it is of great importance that this Bill should be absolutely clear to all those engaged in this trade. After all, the people in this trade have to administer the regulations laid down in this Bill, and they have always behind their elbow, so to speak, at the same time, the danger of infringing the Truck Acts. That is what is worrying them. There is no idea of attempting to amend the Truck Acts, but we do wish to know with regard to this Bill what the Truck Acts mean. That is the point, and I understand, as I have already said, that the trade have already taken very learned advice on this question, and feel that this Amendment should be accepted by the Government. I hope that my

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noble and learned friend, who I believe is going to deal with this matter, will be sympathetic towards the Amendment and enable it to be embodied in the Bill. I beg to move.
Amendment moved—
Page 9, line 34, at end insert—
("(4) For the resolution of doubts it is hereby declared that servants in boarding houses, hotels and public houses, other than those, wholly or mainly engaged in clerical duties, and kitchen staffs, cleaning staffs, waiters and waitresses in cafés and restaurants are domestic servants within the meaning of the Truck Acts, 1831 to 1940.").— (Lord Teviot.)
LORD MORRIS: My Lords, I shall not detain you for more that a few moments, but I can hardly escape paternity for this Amendment, because it is really the same as the Amendment which I moved in this House about ten days ago except for the words "other than those wholly or mainly engaged in clerical duties." Those words have been inserted out of deference to the observations which fell from the noble and learned Lord Chancellor on that occasion. I will content myself by saying that I hope that the Government will see their way to accept this Amendment, if only to give the impression that their attitude towards this matter is not wholly and solely mulish obstinacy, but that they are prepared to accept in some degree at any rate the representations made in this House and in another place by those best qualified to know the difficulties of the catering trade as a whole.
VISCOUNT MAUGHAM: My Lords, I do not intend to say more than two or three sentences, but I feel bound to support this Amendment, because I feel that it does lend clarity to this Bill. I think it is quite possible that the Lord Chancellor can criticize the terms of the Amendment in some respects, but, if the Government want to clarify the Bill, they ought not to be deterred by the fact that an Amendment of this sort is open to some verbal criticism. It may be so, but I wish to repeat what I have said before to-day—namely, that in fact there is great doubt as to whether the persons who are mentioned here are subject to the provisions of the Truck Acts or not. It is true that "manual labourers" alone are within the terms of Section 10 of the Act of 1875. That is a phrase of great wideness, and of rather an artificial character, because everybody works with his
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hands, even persons who are engaged in clerical work, but they are not "manual labourers" as understood by the law. If they are not, then the Truck Acts do not apply, and all is well; but, if they are, they may still be outside the Truck Acts if they are "domestic or menial servants."
We do not much like the word "menial" now, and I think that probably "menial" means no more than "domestic." But the meaning given to the word "domestic" by the Government as announced in another place is very wide; and I know that there are competent lawyers whom I have myself consulted who say that it is a matter of grave doubt whether the list of persons mentioned in Lord Teviot's Amendment are properly within the words "domestic or menial servants." If that is so it is a thing which I should have thought the Government, having regard to the provisions of the Bill, ought to clarify, and if they do not clarify it I am quite sure there will be a crop of litigation in the future.
THE LORD CHANCELLOR: My Lords, this Amendment, subject to the insertion of one qualifying phrase, is precisely the Amendment which was moved on the Committee stage and was negatived without a Division. I do not know sufficient of the practice of your Lordships' House to know whether this exceptional facility after Third Reading of moving Amendments extends according to our ordinary practice to repeating an Amendment which was defeated on the Committee stage with a variation. Of course it is not for me to say.
THE MARQUESS OF SALISBURY: It is quite in order. It certainly is in order.
THE LORD CHANCELLOR: It is in order then. But, naturally, as the Amendment is to so large an extent the same as the Amendment moved on the Committee stage, the answer to it is also the same. My noble friend Lord Teviot in his first sentence said that he had refreshed himself before facing the ordeal of moving the Amendment by "taking a cocktail," and it appeared that the cocktail was one sentence out of the speech which I delivered on this Amendment in Committee. But I am greatly astonished to find that my noble friend did not finish his cocktail. He only took the first sip.
LORD TEVIOT: That was all I wanted.
THE LORD CHANCELLOR: It may be all you thought it wise to swallow but I had better add the two following sentences which are a complete answer to this Amendment. What the noble Lord quoted was:
"What is the attitude of the Government in regard to this admittedly complex question, which no doubt does at times raise difficulties?"
That is where he stopped. But I went on:
"It is simply that the Catering Wages Bill is not a Bill which need affect the application of the Truck Acts one way or another. I could not accept an Amendment which says that for the resolution of doubts all servants in hotels are domestic servants, because it is not true."
LORD TEVIOT: May I interrupt? Nobody ever said that all servants in hotels are domestic servants.
THE LORD CHANCELLOR: Well, we had better look back and see. I quote from the Official Report:
"LORD MORRIS moved to add to the clause:
'(4) For the resolution of doubts it is hereby declared that servants in boarding houses, hotels, and public-houses, kitchen staffs, cleaning staffs, waiters and waitresses in cafés are domestic servants within the meaning of the Truck Acts, 1831 to 1940.'"
LORD TEVIOT: But not all domestic servants.
THE LORD CHANCELLOR: That is a reply which I must leave to the layman. That would not carry you anywhere. My noble friend and those who are with him in this matter have not observed that I merely pointed out that the cashier at the desk is not a domestic servant by way of example, and I am very much afraid that his researches have not carried him to other examples. He wants the House to say: "For the resolution of doubts it is hereby declared that servants in boarding houses, hotels and public-houses…are domestic servants other than those wholly or mainly engaged in clerical duties." I really cannot accept that. Nobody with any sense of responsibility who understands the law could accept it, because it is not true. It is not true that everybody who is employed by a hotel company except the clerical staff is a domestic servant. Let us take the resident
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manager in a first-class West End hotel. He is not on the clerical staff.
VISCOUNT MAUGHAM: He is not a manual labourer.
THE LORD CHANCELLOR: Yes, of course. But the point is that he is not a domestic servant at all, and the proposition that he is a domestic servant is one which I really cannot ask the House to put into the Bill. The reason why the resident manager and some other people do not come within the Truck Acts has nothing to do with domestic service: it is due to the fact that they are not manual labourers. You will find, therefore, that to put this thing right is not quite so easy as it looks. I must therefore quite briefly point out how the position stands. The Truck Acts are, I quite admit, a complicated piece of legislation, and it is perfectly true that cases arise where doubt is expressed as to whether a particular kind of person employed is on one side of the line or the other. That has nothing to do with the subject of fixing wages. The Truck Acts have nothing to do with fixing wages; the Truck Acts have to do with how the wages are paid. This Bill has nothing to do with how the wages are paid. It deals with fixing wages, and while it may be quite true that it is desirable to attempt to amend the Truck Acts, it is quite impossible to insert in this Bill a small clause which really does not amend the Truck Acts but makes the wholly incorrect assertion as to what the Truck Acts contain. That surely must be quite obvious.
LORD TEVIOT: Is not it very difficult, in view of what my noble friend has just said, to understand what the Truck Acts mean? That is the whole difficulty that the trade is in.
THE LORD CHANCELLOR: I do not think the trade are, in point of fact, in this difficulty, and if they thought so I should be very glad to see them. But what is quite certain is that whatever difficulty there is cannot be disposed of by inserting at the tail end of this Bill four lines to say that "for the removal of doubt" the law is that everybody employed in a hotel is a domestic servant unless he is engaged in clerical labour. It is grotesquely untrue. That Would not be declaring the law at all, but making a rather absurd misstatement. I would point

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out to my noble friend who, like myself, had a long experience of the House of Commons, that those of us who have been in the House of Commons might very well think that such an Amendment as this would be ruled out of order, because the Speaker would say, "This Bill deals with regulating wages, it does not deal with the way in which wages are paid." And he would not allow such an Amendment.
VISCOUNT MAUGHAM: I am very loath to interpose, but really my noble and learned friend must not forget the provisions of Clause 10 (2), under which the effect of the Truck Act is of very great consequence. It states:
"Notwithstanding anything in subsection (1) of this section, wages regulation proposals and wages regulation orders may contain provisions authorizing specified benefits or advantages, being benefits or advantages provided, in connexion with the employment, by the employer…and not being benefits or advantages illegally provided."
I conceive that it is very necessary to know what the Truck Acts become in order that you may know what is permissible under Clause 10 (2) of the Bill.
THE LORD CHANCELLOR: I do not mind being interrupted, but I must say I think the last interruption was perhaps rather hastily undertaken. I was referring to noble Lords having experience in the House of Commons, and I said that to those familiar with that place it might be thought that the Speaker would think this was out of order.
VISCOUNT MAUGHAM: I was pointing out that the Speaker might be wrong.
THE LORD CHANCELLOR: That is quite possible. In Clause 10 there is a reference to the Truck Acts. But there is also a reference to the Health Insurance Act, as well as to other Acts. All I am saying is that if this Bill deals with regulating wages in the catering trade, that is a wholly different question from how those wages are paid, and I venture respectfully to say that that is a consideration which should appeal to those members of the House who are familiar with rulings in the House of Commons.
LORD TEVIOT: My Lords, I apologize for referring to this matter, but it is a fact that Sir Douglas Hacking withdrew his Amendment on this very subject
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owing to what was said by the Solicitor-General in another place.
THE LORD CHANCELLOR: I can deal with that interruption, too. Earlier to-day I heard another noble Lord use a very offensive expression in reference to the Solicitor-General's action, and I am glad to have the opportunity of repudiating it. What the Solicitor-General was asked to do by Sir Douglas Hacking was to state, for the information of the House, how the Truck Acts were likely to apply in the case of hotels. He very obligingly complied. There was no question whatever of his misleading anybody. I am quite certain that Sir Douglas Hacking would never suggest for a moment that he was misled. But somebody to-day suggested it was a piece of trickery.
LORD MORRIS: The noble and learned Viscount is not infallible. The word I used was "chicanery" Sir David Maxwell Fyfe is a personal friend of my own, and I would not suggest that in any way he would do anything improper.
THE LORD CHANCELLOR: "Chicanery" then. Very well. I repudiate with great indignation the suggestion that my colleague in the Government could be capable of chicanery. What he did in the House of Commons was to give an exposition of the matter, for which he was thanked. He did not secure the withdrawal of the Amendment or affect the decision of anybody by what he said. I hope I have also made the matter clear to your Lordships, and I am sorry I cannot accept the Amendment, because I believe it would go outside the scope of the Bill. In any case, the Amendment is one which would not correctly state the legal position.
On Question, Amendment negatived.
Bill passed, and returned to the Commons.

MILITARY DISPATCHES AND PUBLICITY
LORD MILNE LORD MILNE rose to ask His Majesty's Government whether, in view of the fact that they have abandoned the time-honoured custom of publishing the dispatches of Commanders in the field, they will consider the advisability of giving more publicity, so far as the requirements of secrecy permit, to the names and deeds

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of gallantry of units; and to move for Papers.
The noble Lord said: My Lords, I feel rather diffident in making any remarks after the legal discussion we have had, but I cannot help thinking it is probably a good thing to bring our minds back at the present time to the actual state of the country, which, your Lordships will remember, is still at war. When I put this Motion down I had two reasons for doing so. In the first place I wanted to give the noble Lord (Lord Croft), who represents the War Office in your Lordships' House, an opportunity of enlarging on the statement he made on the occasion of the Vote of Thanks to the Forces on the conclusion of hostilities in Tunisia. The other reason was more important. It was to try and persuade His Majesty's Government of the general advisability of more generous publication of the names of the men and the deeds of the units which have taken part in the past, and will take par in the future, in operations on land, on the sea, and in the air.
It has come to my knowledge that a considerable amount of dissatisfaction and irritation has been caused by the statement of the noble Lord, not on account of what it contained, but on account of what it did not contain. Some of the units who were not mentioned have spent six years away from their homes. They have taken part in every operation that has taken place from the time of General Wavell onwards to General Alexander. Their relatives at home could not understand why their names were not mentioned. On what basis was the selection made, because if your Lordships would look at the names which were mentioned you would find that it is a rather strange medley and rather strangely put. The real reason was, I think, that there was some misunderstanding. The noble Lord, Lord Mottistone, asked the question which was answered by the noble Lord, Lord Croft, and as they were both yeomen, no doubt they were impressed by the fact that the Yeomanry ought to be mentioned. It could not possibly have been intentional.
I should like to say that any information I have got has come solely from the newspapers and from no other source. The names of distinguished regiments like the Rifle Brigade and the both Rifles, who fought in every battle and in the most
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distinguished Corps in the most distinguished Army, were left out altogether. There was a little applause when the name of the Brigade of Guards was mentioned, but when I was in more active service, I remember, there was a certain amount of—shall we call it jealousy of the Brigade of Guards? In the Army they rather like to have the names of their regiments mentioned. It was unfortunate they were not. No cavalry regiment was mentioned at all. They felt that very bitterly. These things do hurt in the Army. The strange thing was that one of these cavalry regiments had taken part—I am not giving away any secrets because it appeared in the Press; sometimes the War Office look upon things as secret after they have appeared in the papers—one regiment had taken part in the entry into every town captured since the Battle of El Alamein right up to the entry into Tunis. It is a well-known regiment. If the Under-Secretary had been present, he might have said that the term "Royal Armoured Corps" covered all the cavalry regiments, but they do not think so. They do not quite agree with that idea. If it is the case that the whole covers the part, why should he refer to the Royal Artillery by the name of a very small part of the Royal Artillery? As Colonel of the Royal Artillery, it was difficult for me to understand what was meant. Then again the nerves of the whole Army—the Royal Corps of Signals—were not referred to at all. Nor was a Corps like the Pioneer Corps which, at one time, had to throw down their spades and pick up their rifles to hold a gap. They, too, felt hurt.
It is not good. The Army as a whole, since the war began, has had a rough deal, even in your Lordships' House. It was not their fault that they started the war ill-equipped and untrained, and it certainly was not their fault that on many occasions in that state they have had to be shoved into holes to fill gaps. They have borne the brunt and suffered heavy losses, as your Lordships could see only the other day from the statement of losses for the last three years. But that is no reason why the propaganda department of the War Office should be so singularly inefficient. There seems to be a dead hand somewhere which hides what is going on. If I may say so, it is not good for the country.
I am really thinking more perhaps of enthusing the country than any other point. Most of your Lordships who have commanded men and those who have had to deal with men must know that there is something which runs through a collection of men. You may call it morale, you may call it esprit de corps, it does not matter what you call it. The commander of an army knows it. It is like a highly tempered spring; it has to be carefully nursed. You had an example of that happening after our defeats in Libya. You had an example of that sentiment recently when General Montgomery took over command along with General Alexander. It is a personal something which enthuses an army and which enthuses a nation. The Royal Navy have it, they know it, they have their own technique for it and a very high standard of technique it is. There is no ship too small, there is no rank too low, if a man deserves to be mentioned he is mentioned. You have only to look at the high standard of the Navy to see its value. The noble Viscount who was responsible for raising the Air Force, who I hoped would have been with your Lordships to-day to give me his support, thoroughly understood when he was in charge of the Royal Air Force the necessity of enthusing the young pilots with a sense of their duty and a desire for glory.
And that has been carried on most wonderfully by his followers in the Air Ministry. What happens? Within a few minutes or within a few hours of any great deed that is done by the Royal Air Force the whole world, not only this country but the whole world, is told what has been achieved, what has been done, and is told also the names not only of the leaders but of the sergeant pilots. What is the result? The Royal Air Force is held and rightly held, in the very highest esteem throughout the country. But the War Office—and I am rather sorry to say it without a representative of the War Office to contradict me—to my mind are sometimes inarticulate. They do not seem to desire to spread that feeling throughout the country.
Secrecy in war is most important, but secrecy is not everything. There is something else. There is enthusiasm amongst the troops, and what is more important,
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there is enthusiasm in the nation for the work of the troops, and both of these are sometimes extraordinarily lacking in this country. I would remind your Lordships that the Army of the present day just like the Armies of the past is founded on that one great thing that we cherish in this country—at least I hope so—tradition. The British soldier, and I have known him for a great number of years, is a strange person but the centre of his loyalties and the centre of his affection is the regiment. It is his pride in the traditions of his regiment that will sustain him in the greatest difficulties and even in the field of battle. He will die for his regiment when he will not desire to die for some of those strange names invented for the purpose of covering his regiment up in another corps. Now in high places to-day there seems to be a lack of appreciation of the immense psychological and practical value of that great asset that we have in our Army and in our nation. To my mind that is a calamity.
Why are we told so little about our leaders in this war? It was not so in the last war; then it was quite different. The nation knew them; you could even see their pictures. In this war we know nothing about them except for a few and the junior and middle leaders are entirely unknown. Then again on the occasion of a great national thanksgiving service at St. Paul's there was not among the congregation one leader who had come from North Africa. It seems an extraordinary omission. It was an omission which was noted by people. This is the first time in my life that I have had to watch a war from a seat in the gallery, and I have been rather surprised and a little shocked at the lack of interest that is taken in the fighting deeds of the men of all three Services amongst the civilian population of this country. You very seldom hear any talk with a certain amount of pride in it of the deeds the men are doing overseas. I often feel that the main subject of conversation in this country is more the details of the Ministry which is so eminently presided over by Lord Woolton.
I very greatly regret in this respect that we have given up the old-fashioned habit of publishing dispatches. They had their value. In a dispatch you had the history of the campaign written over the signature of the Commander. He gave his difficulties and he showed how his conclusions

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were arrived at. I admit that these dispatches probably at times were not a great literary effort, but to-day we are fortunate in having Commanders in the field who are very great writers and they might be able to enlighten us. I would like to bring to your Lordships' notice the meagreness of the details that we are given of events that happen in the field. No regiment desires publicity for publicity's sake, but there are wonderful deeds being done to-day and the people of this country are never told anything about them. May I take one example? I could give many others. Some months ago a battery of artillery was told off to co-operate with a certain infantry regiment. I am not permitted to tell the names. At the end of the battle, when morning broke, every officer and 95 per cent. of the men lay dead around their smashed guns. The Germans knew what had happened, the Army knew what had happened, but when the report came to me as Colonel of the regiment it was marked "Secret." That happened three months ago. "Secret" from whom? The Germans knew of it. It is one of those actions an account of winch ought to be read at the head of every unit in the British Army. It was a feat of arms similar to one which in a previous war won four Victoria Crosses on the spot. What happened in this case? These men have gone and they are unknown and unhonoured. I could tell you of many other cases.
The Deputy Prime Minister the other day told us that General Alexander's operations were a "classic example of the art of war." But we know nothing about them. We do not know what these operations were even. Surely if they were a classic example it would be advisable that they should be published for the benefit of the younger officers who would be able to read them and carry out the details of this example during the next few years of the present war, because they will not be of use to the coming generation if, as we are told, after this war there is to be no other war. Might I suggest to His Majesty's Government that early publication of General Alexander's dispatches would be of very great advantage? I mean something in addition to the Caesar-like reports he has already submitted to His Majesty's Government.
There is another point which I think is worth considering. The non-publication
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of dispatches tends to make the public think that there is something to conceal. Of course there have been mistakes. There have been mistakes in the council chamber and mistakes in the field, but no one has ever won a war who has not made mistakes. After a certain time there can be no harm in publishing even the mistakes we have made. It is now nearly two years since the operations in Norway, in Greece, in Libya and in Crete. Regarding none of these have any dispatches been published. There cannot be any real reason for keeping these things secret. There has been a great campaign in Abyssinia, a most successful campaign. Surely there can lie no reason for not publishing the details of that campaign. It is not very fair to the troops who took part in it or to the young and gallant Commander who brought it to a successful conclusion. I know that stories have been published in books, and some of them are very good, but they are not the same thing. They do not convey the same impression to readers as dispatches written by Commanders on the spot. One of the best of them, Combined Operations, should have been published over the signature of the distinguished officer who deals with these operations. The account would have carried much greater conviction over his signature and if written in the words which I am certain he would have used. As a Press notice said, why should not these Commando stories have been published two or three months earlier when they would have carried much greater effect?
Reverting to my remarks about North Africa, I would call attention to the fact that the only information we have had about North Africa, the only detailed information, is an account which appeared in The Times. That account showed us the difficulties and it showed us the reason of the delays. It excused many of the things that happened which most of us, looking at it from the outside, thought were unnecessary delays or probably mistakes on the field of battle. These are the things that the country desires to have cleared up, and I think when they are cleared up it will be found that the work done by the First Army under General Anderson was probably as great as that of the victorious Eighth Army. But we do not know. We are not told and it is not good for the nation that it should not be roused to enthusiasm by

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the deeds of their menfolk who are going to help the war to a glorious end.
THE EARL OF CORK AND ORRERY: My Lords, I am very glad as an elderly naval officer to speak in support of my noble and gallant friend because in the Navy—and I believe in the Air Force too—we think that the Army has had a very raw deal. They are always Cinderellas in peace-time, when they are not given enough money, and then the old Regular Army has to die while we are forming new Armies to go and win the victories which always come later when British soldiers get a fair chance. Nothing, I think, is more important than that when we enter into what may be a very long period of great military operations the nation should know what our soldiers are doing. After all, we have a great number of men under arms and nearly every family has among its relations soldiers, many of them serving with units directly identified with counties, cities and towns. Both the Navy and the Air Force get a certain amount of publicity—sometimes, I think, a little too much, as for instance when you hear of some German craft and a British motor boat meeting in the Channel or of one aeroplane being shot down off the coast.
These little instances are mentioned, but similar incidents on shore are never mentioned. We hear of patrol activity. I take it that when two armies are in contact to-day patrol activities probably involve many men in many units, so many that in the days of the South African war a clash between them would have been described as a battle. But we never know the identity of these gallant parties of men except when we read the citation when an officer gets some honour. Then we hear that an officer and three men performed some act of gallantry but, although the name of the officer is given, we do not know the names of the privates. What a good thing it would be if, in the town from which these men came, their names were known even if they got no decorations. Tradition is everything in the Fighting Services. What an effect it would have on young soldiers to read that another battalion of their regiment had carried out some great decd. Yesterday I asked a Devonshire man whether he ever heard anything of what the Devon regiment was doing. He replied, "I never hear anything of it, though I have two sons in it."
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I would like to make a suggestion that, perhaps on a regional basis, special reporters should be sent abroad to report on the work of actual units connected with the regions they represent. This should not be difficult. Their reports would, possibly, have to be on a somewhat lower scale than those published in the great national newspapers. But they would be very welcome to the people living in our provincial centres. They would be read throughout villages and towns and hamlets all over the country, and if, in the course of those reports, names were mentioned, the interest which they excited would be intensified. If incidents were not reported until, say, two months after they had happened, there could be no question, surely, of violating necessary secrecy. If this suggestion of mine were carried out it would, I submit, do a great deal to keep up the spirits of the nation. And I venture to think that they want keeping up.
We are getting into a way of thinking that the war is over, whereas it has not really begun. We are now just about to land the first soldier in an invasion on the Continent of Europe. Yesterday we were told about the wonderful successes which have been achieved against the U-boats, and everybody was glad to hear of those successes. But it does not seem to have struck anybody that the Germans may have reserved a large number of U-boats for anti-invasion operations. Submarines played a great part in preventing German troops and supplies from getting to North Africa, and the Germans may very well think that if they reserve a considerable number of theirs they will play a great part in breaking up our invasion or in helping to break it up.
I was going to allude at some length to a subject which the Field-Marshal mentioned—that of Generals. By chance we have had two successful Generals in London at the same time, and the public has not been allowed to know of their presence. I happen to know one of them was here because I was told so by a man I met in the street—a man whom I did not know but who happened to know me by sight. He said to me: "I think you would probably like to know that General So-and-So is here. If you go up the street you will be likely to see him." Now intimations of that kind were being passed from passer-by to passer-by. People were telling each other that here

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was a chance of seeing a successful General. Now why should the arrival of that General, or any other successful General, not have been the occasion of some ceremony? Why should there not have been a reception at the station followed by a drive through cheering crowds? And I am not speaking only of Generals. I venture to think that Admirals or Air-Marshals who have won victories for us should have some public tribute paid to them when suitable occasions arise. The people should be given a chance to express their gratitude to such men for the victories they have won for us.
If there is thought to be anything in my suggestion of having special correspondents to send home news about units which may be read in the localities with which they are connected, I would like further to ask that die large number of Irishmen serving in the Forces should not be overlooked. I am not going -to offend against the rules of your Lordships' House by discussing the politics of a self-governing Dominion I am referring to the 200,000 odd Irishmen and Irishwomen who, of their own free will, are serving either in our Services, or in our munitions factories, or in other war works in this country. In The Times on the 29th of last month there appeared a letter which quoted the answer, given to a question asked in the Dail, which stated that British money and postal orders to the amount of £4,236,000 had been cashed in Southern Ireland during the year 1942. Now, four and a quarter millions is a very great sum, and of course it does not represent all the money being paid to Irish men and Irish women serving here, for they have to keep themselves in this country.
The correspondent sought to show how dependent Ireland was upon this country. I read it the other way. I suggest that it shows what a volume of help is given to is by individuals from across the Irish Sea. If these men and women were withdrawn from this country they could not possibly be replaced. To grudge, in any way, the pay they receive, or the food they consume, as another correspondent did, seems to me singularly ungracious. The labourer is still worthy of his hire. In asking that accounts of the deeds of the Territorial troops and others should, as far as possible, be made public in this
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country, I ask also that Irish units and Irish soldiers generally should not be overlooked. In conclusion, I suggest that everything should be done to mention by name those men who distinguish themselves, never mind whether they are awarded decorations or not. Let the record of their deeds go out to all our towns and villages so that they can be the basis of discussion. Let us raise the morale of the country by giving greater publicity to the deeds of the Army.
LORD HUTCHISON OF MONTROSE: My Lords, I am delighted that my old friend the Field-Marshal has put down this Motion. When Lord Croft recently read out a short list of units engaged in recent operations in an endeavour to do a kindness to Lord Mottistone, who asked that it should be done, I got in touch with him and told him what the effect was going to be. What I said has more than come true. I have had a great number of letters, and no doubt the Field-Marshal has also, containing complaints because other units than those, the names of which were read out by Lord Croft, had not been mentioned. The public did not recognize the limitation of the question that was put to Lord Croft at that time, but, nevertheless, the damage was done, and I cannot but feel that the decision to publish the names of certain units was taken without proper consideration. If careful thought had been given to the matter at the time I doubt whether such publication would have been made. I hope that what has happened will be a lesson for the future.
I am in complete agreement with my old colleague the Field-Marshal, and also with my noble friend the Earl of Cork, in what they have said. We have had far too little publicity concerning the wonderful deeds of our Armies. In particular, there has been far too little concerning the great achievements of our people in North Africa and, indeed, in regard to what our forces did, ill-equipped as they were, in facing the many disasters which we have met. I think that it would be a great help to this nation in the war if a more active, vigorous and picturesque form of propaganda were put out dealing with our various military units, in the different spheres where they are operating. I do not for one moment say that the same does not apply also to the work of our Navy and our Air Force, but I am particularly concerned to-day to deal with

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propaganda relating to the Army. Millions of men serving in the Army all over the world read, often many months after publication, periodicals that are sent out to them from this country. Men and women all over the country in towns and villages take the greatest interest in reading of the doings of our men in the field, and especially in reading of the exploits of units—regiments, platoons and individuals. When they read of the doings of our splendid Generals, and subordinate leaders and their men in the field it tends to create an atmosphere which makes them feel that they, too, have got to do their bit in helping along the work of the war. There is a coalfield where we have had a great deal of trouble over the production of coal, and there to hear of the doings of the 55th Division, for instance, would stimulate the men and make them undertake greater efforts to do their bit towards winning the war.
I hope that the War Office will pay attention to what the noble and gallant Lord has said with regard to the publication of dispatches. It is simply unbelievable that dispatches dealing with incidents three years old have not yet been published—incidents which took place in Malaya and Burma long ago, and of which the enemy well know every detail. Why these dispatches cannot be published now puzzles all thinking people. I venture to say that a revival of the old habit of publishing dispatches within a reasonable period after their receipt by His Majesty's Government would be a very great incentive to our people, and would stimulate the interest which they take in the war. We are meeting with greater success at present, but that is not to say that we are anywhere near the end of the war, and it is the final, collective and vital effort of the nation which will be of the greatest value when the end comes. I hope that the lesson of the misfortunes of publishing the names of a few units only will be taken to heart by the War Office, and that they will try to do something to put matters right. I know that there is strong feeling about this. I have had letters from various units, and they cannot understand why they have been omitted from the list when they have been fighting as long as, and sometimes very much longer than, the units whose names have already been given to the public.
LORD NATHAN: My Lords, the noble Lord who has just spoken expressed surprise that the dispatches have not been published which relate to the incidents which took place in Malaya and as to the campaign in Burma. That, however, is relatively modern history. No dispatch has yet reached the British public with regard to what took place in Norway. That campaign is long since over; it is part of history, and, since things move so rapidly, it is almost part of ancient history; but no communication has been made by the Commander of those Forces, whether military or naval, which has reached the ears of the British public. It was partly as a result of discussion in your Lordships' House, which I remember with gratification that I initiated myself, that ultimately the dispatches of Lord Gort were published. There was a persistent resistance on the part of the War Office, which would have continued had not it been for the equally persistent demands of those speaking in your Lordships' House.
It was a good and sound tradition that Generals in the field, having control of His Majesty's Armies, should make a report, and that that report should be published to the people, so that they might know what had been happening to the Armies which they had founded, and to their brothers, their sons and their kinsmen, and how the responsibilities which had been entrusted to the Commander had been exercised. During this war, with the sole exception of Lord Gort's dispatches, there has been no report made to the public at all of an official nature. The public have had to rely upon curt communiqués designed to give as little and not as much information as possible, to give only as much as the decencies of the situation required.
Other information, however, has come to the British public. It has come to them from the books which have been published in large numbers by a variety of authors, many of whom were in every sense participants in the events which they describe except that of being members of the actual Fighting Forces—from qualified and authorized correspondents, for instance. A book has been published, for example, with regard to General Wavell's campaign. Nothing has been issued to the British public over the signature or under the authority of Field-Marshal Sir Archibald

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Wavell, but a book—and more than one, no doubt—has been written. One which I have particularly in mind is called Mediterranean Year, by Alan Moorhead. It gives a most remarkable description of the campaign, with details unobtainable elsewhere, sc far as I am aware. Similarly, there has been no publication of any dispatch by General Auchinleck relating to the campaign which ended at El Alamein, but a book by the same author, Alan Moorhead—a very remarkable book—called A Year Of Battle, has been published, which gives a vivid description, and an inspiring description, such as the British public would wish to have of the Forces which they have sent overseas to fight in this war. There are, of course, other books which have been written, some perhaps more and some less authoritative, but there has been none issued with the imprimatur a the Commanderin-Chief or of the War Office, apart from Lord Gort's dispatches.
Why should that be? It cannot be for reasons of military secrecy, because so much has teen disclosed already in the reports made, not by authorized spokesmen of the Government, but by the authors of these various books, and by commentators who have broadcast. It cannot be due to reasons of military secrecy. I speak subject to correction, and with deference to those with greater knowledge and experience than myself, but I would suggest—and indeed I have never heard it suggested otherwise—that the only reason for secrecy, apart from secrecy regarding actual movements currently taking place, is to ensure that the enemy shall not know our order of battle. There can be no question, however, of the enemy deriving information about the order of battle when the information relates to campaigns long since past.
Why should this secrecy prevail with regard to the Army, moreover, when it certainly does not prevail with regard to the Navy, so far as past events are concerned? I was reading yesterday evening an admirable document, produced by the Ministry of Information for the Admiralty, under the title East of Malta, West of Suez. It gave a clear, vivid, exciting and most interesting and instructive description of what had taken place during the first two years or mare of the war in the Mediterranean theatre, mentioning the names of the ships
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engaged, both the great ships of war and even the small gunboats, the actual exploits in which they were engaged, with the names of the places, and maps showing where they were engaged at particular moments, and in most cases the names of the officers who commanded them. Why should not the same thing be done with regard to the Army?
I agree very much, and most respectfully, with the noble and gallant Lord, Lord Milne, who speaks with so long and so wide an experience of war and of Armies, that tradition is the fulcrum of the whole business. Unless the soldier at the war is encouraged to take a pride in his own regiment, and his family, relations, friends and neighbours at home are encouraged to pursue an interest in the regiment which hails from the neighbourhood, you lose much which was of value in creating and maintaining a strong active fighting force firmly welded together. Every regiment has its own traditions. In the Royal Regiment they do not speak of the noble and gallant Field-Marshal as a Field-Marshal or as Colonel of the Royal Artillery: they speak and think of him as the Master Gunner, and that is the tradition of the regiment and it means a great deal to all those who belong to the regiment. I remember reading in the reports of the Syrian campaign how a certain battalion, with its ammunition exhausted, defended a locality to the last man. It was said that it was a battalion of a famous regiment; nothing more was said. It was, in fact, a battalion of the Territorial Army, a battalion of a regiment I know well. What a magnificent thing it would be, how encouraging, if those drawn from the Territorial Army had been told that this regiment, which had done a magnificent piece of work, was a regiment which so many of them knew well, and in which so many of them had friends. The whole value was thrown almost recklessly away.
We have heard something of what particular units have done—the Hampshires and the Royal West Kent in North Africa. We have heard about these isolated examples. It is not that other feats, equally outstanding, have not been performed, but that we have not been told of them, or that no names have been identified with them. I am sure that that is a profound mistake in psychology, in

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the understanding of the public mind, because, let it be noted, while the people of this country are filled with the determination that this war shall be brought to its only possible end, yet it is a determination which throughout has been unmarked by passion, and it is difficult to create that passion, which is the sustaining factor in determination in times of war, if those who are fighting and their friends and relations are kept in ignorance of what has been done by those dear to them at the actual scat of battle. When my noble friend Lord Croft—I am sure with the best intentions in the world and every desire to be helpful—gave a list of those engaged in North Africa, it was insufficient in the sense that it was partial, and I agree with what the noble Field-Marshal has said, that it was a thousand pities that the Cavalry Regiments, to which so much has been due in North Africa in particular, were made anonymous by being referred to as the Royal Armoured Corps. The more individual units can be named, the more the exploits of individual units can be brought home to the people authoritatively, the greater will be the understanding by the people of the Army, and the greater their pride in the achievements of the Army. Let us not forget that it is an Army which is not only at the wars, it is an Army which is one day coming home from the wars, and it is vital, if we are to pass safely and quietly through the difficult periods to come, that the people who are to receive the returning soldiers should feel, from what they have been told and what they know, that the returning soldiers have deserved well of their country, as indeed they have if only the world were allowed to know it.
LORD TEMPLEMORE: My Lords, my noble friend the Parliamentary Under-Secretary of State for War is unfortunately away ill and I have been asked to reply. Although I might feel embarrassed in doing so, it is really a great pleasure to me to reply to my noble and gallant friend Lord Milne, because the noble and gallant Field-Marshal and I are old friends; in fact, we were old colleagues in a way, about fifteen years ago, when he occupied a very high position in the War Office and I a very humble one. I listened with great interest to the noble Lord, Lord Milne, and I sympathize fully with his
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wish, which I am sure is shared by all of us, that the country should hear as much as possible about the individual units which built up the forces responsible for the victorious campaign in North Africa. We have heard how the battles went from communiqués issued in North Africa and from statements made here by members of the Government, but the noble Lord feels—and I know that his views are shared by many other people—that more should be done to do honour to particular units and especially to those who have taken part in the recent victories, in order to give pleasure and satisfaction to those units and to stimulate our pride in the Army.
Before I refer more fully to this I should say something about another related question to which the noble Lord referred. the publication of dispatches. This has been most carefully considered by His Majesty's Government on several previous occasions. Dispatches are not written with a view to publication and as the noble Lord will appreciate would lose much of their value if they were. They are written in order to give His Majesty's Government the fullest possible narrative of events and the lessons derived from them are applied to future operations. They thus contain information which might well be of use to the enemy in making his preparations to meet our further assaults. I hope the noble Lord will agree with me that there is great force in this argument.
But these considerations apply only to the dispatches themselves. It does not mean that a comprehensive account of a campaign cannot be published. The public is anxious to have such an account to supplement the official communiqués and the day-to-day reports of the newspaper correspondents working with the Armies in the field. This need has hitherto been met by the publication by the Stationery Office of the Army at War series of books, which must by now be very familiar to your Lordships. They are not a substitute for dispatches. They do not contain the views of the Higher Command on the equipment of the Forces and on the operations in which they were engaged but they give an accurate and comprehensive account of what happened. Such books have so far been issued on the Battle of Flanders, the Defence of Calais, the Highland Division, the Northern Garrisons, the Campaign in Greece

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and Crete, the Abyssinian Campaign, the air defence of this country and finally the campaigns in Egypt and Libya. Some of the books are illustrated. A further such book is now in preparation on the Eighth Army. I understand that it will make a point of dealing with the exploits of particular units, in so far as security permits, and of tracing their movements across the vast battlefield and through the changing fortunes of the campaign.
This brings me to the question of publishing the names of units engaged in campaigns and at the moment this means in the campaign in North Africa. We have always sympathized with the desire, at the earliest moment consistent with security, to make known the names of corps and regiments which take part in various campaigns, more especially when a campaign culminates in a glorious victory such as we have just celebrated. It was for this reason hat my noble friend the Under-Secretary, when asked in the debate on May 18, mentioned certain regiments which, on security grounds, could then be mentioned. I know that the list was not complete, and that to mention any names has one disadvantage because failure to mention other regiments not yet released causes not unnatural annoyance among those interested. I am afraid that that happened on this occasion. But I should like to correct my noble and gallant friend. He said that the Under-Secretary did not mention the Royal Corps of Signals. In fact there was a letter in The Times two days afterwards on that subject. My noble friend did, in his speech, mention the Royal Corps of Signals, very rightly. My noble friend by way of warning, your Lordships will remember, stated that it would not be right to mention particular regiments without recalling that other regiments and the great Corps, without which an Army cannot go into battle, also took a prominent part in all those operations. Many names of regiments had, of course, previously been released and had appeared in the Press, and accounts of the successes in action of all regiments so released have been published.
The noble and gallant Field-Marshal and your Lordships will be anxious to know whether we cannot go further than this and publish the full list, thus openly giving all regiments their due. I am sure my noble and gallant friend will agree that the Commander-in-Chief in the theatre of
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war must have the final say in this because, after all, he is responsible for the security of these troops in any operation which is pending. On the other hand, I need hardly emphasize that a Commander is more than anxious to ensure that the achievements of the units in his Forces are fully appreciated by the rest of the Army and by the nation at large. I have to say here that we have been advised by the military authorities in North Africa that the publication of the full list of the units would, in their opinion, be useful to the enemy.
Very often the units which have advanced furthest and with the greatest success are just those which have lost no prisoners to the enemy and have therefore not been identified. In view of future operations, therefore, it may well be inadvisable to inform the enemy that a unit was in action, of the presence of which unit he was unaware. But full publicity will be given whenever the Commander-in-Chief releases the names of such units, particularly when they are associated with individual distinguished actions. We are most anxious, as far as the needs of security permit, that everyone should know what units took part in the recent great victory, both First Army and Eighth Army, and I can assure your Lordships that they will be released immediately those on the spot, who are best able to judge, feel it can be done with safety.
I should like here to refer to a remark made by my noble and gallant friend Admiral of the Fleet Lord Cork, with regard to ignoring Irishmen serving in the Forces. I can assure my noble friend that there is no intention whatever to belittle in any way the great services which Irishmen, both from the North and from Eire, are giving to the nation in the present war. My noble and gallant friend rather took exception to a letter in The Times which he said grudged Irishmen the money which they received for services over here. It is not my province to defend The Times newspaper or those who write to it, but I do not think that letter was written for that reason. It was written for another reason into which it would not be proper for me to enter here.
I have answered my noble friend to the best of my ability, and if he is not entirely satisfied, I hope at all events he is not too dissatisfied with what I have said. I am sure of one thing that, as an old

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Commander-in-Chief in the field, he will acknowledge that denial of information to the enemy, and the safety of the troops, must be the first consideration of the Commander-in-Chief, the War Office, and the Government. I am very glad that we have had this debate, and I should like to express the thanks of His Majesty's Government to the noble and gallant Field-Marshal for initiating it. We have too few military debates in this House and, if the noble and gallant Field-Marshal will allow me to say so, we do not hear him nearly as much as we should like.
We say about ourselves that we are not a military nation, but all the same, when we have been at it for a year or so, we do not make very bad soldiers. The country is deeply stirred with accounts of any gallant deeds done by the county regiments and corps like the Royal Artillery, the Royal Engineers, and so forth. I can assure my noble and gallant friend, as far as I am personally concerned, I once had the honour to serve in one of the units which has covered itself with glory in North Africa, and I should be only too pleased if the names of that unit and of any others were released as soon as possible. In conclusion, I can only express my personal hope, which I am sure is the hope of His Majesty's Government and of us all, that at an early date it will be possible to publish not only the names of regiments but the numbers of the battalions and also, I hope, the numbers of batteries of artillery as well as the field companies of Royal Engineers which have taken part in the recent operations and which have, in so many cases, performed deeds which will bear comparison with any of the gallant deeds of the past.
LORD MILNE: My Lords, I should like to say how grateful I am to my noble friend for his very full and courteous answer. He asked if I was satisfied or dissatisfied. I am not entirely satisfied, but I am quite willing to accept the statement that it should be left to the Commander-in-Chief in the field to decide what units should be mentioned. The noble Lord referred to certain books which he said had been published by the Stationery Office. I have never heard of them. When I say I have never heard of them, you can imagine
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how many copies of them have gone round the country. My noble and gallant friend beside me has never heard of them either. That does not suggest that these publications can be very well known in the country districts or even that they occupy a very conspicuous place in the booksellers' windows. Might I also point out that in the list of names he gave of these books there was no mention of Norway? The Norwegian campaign took place over three years ago. Norway does not seem yet to have been mentioned, though a history of the Norwegian campaign has been published by the Norwegian Government. In these circumstances, with your Lordships' permission, I withdraw my Motion.
Motion for Papers, by leave, withdrawn.

POST-WAR RULE IN EUROPE.
LORD RANKEILLOUR LORD RANKEILLOUR had the following Notice on the Paper: To ask His Majesty's Government whether in pursuance of the principles of the Atlantic Charter it is a part of the policy of the Allies to prevent the seizure of arbitrary power by any person or party in any country of Europe pending the adoption by free choice within such country of the form of government which its inhabitants desire; and to move for Papers.
The noble Lord said: My Lords, I do not propose to address your Lordships at any great length. The object of the words I have put upon the Paper is to obtain if possible some statement from the Government which may allay a number of suspicions that are very prevalent throughout the world and a detriment to our war effort. The most noted and the most ventilated are those which have arisen between at any rate some of the partisans of two distinguished French Generals. It is now some months since The Times correspondent in Algiers referred to the subject by saying that at the time the trouble was not so much between the Generals as between some of their adherents. Their idea was that whoever got possession of the resuscitated French Army might use it for a coup ďétat to place himself or a party agreeable to him in power. And some of your Lordships no doubt will have had a circular letter from a senior French officer actually making this charge against one distinguished General. We may hope

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that the controversies between the two Generals will soon be composed, but the kind of suspicion I have indicated is there and may arise again, whether with regard to them or to other Generals or parties in France. In French history there are precedents which point the way and which Frenchmen, with their long memories, retain in their minds.
All this of course is entirely contrary to the principles of the Atlantic Charter but the question is: Will that Charter be effective? I suggest that it is only by some concerted measure by the Allies that those suspicions can be allayed or the results feared conceivably may be prevented. And in this connexion I would say that if there should be a usurpation of government in any country a plebiscite undertaken by that Government would be completely futile, as has been shown in France, Germany and no doubt elsewhere. But this matter goes beyond France. There is an impression prevalent in the world that it is part of British policy to abet Left elements in other countries. It is quite untrue and it is very absurd. I will not dwell upon how it has arisen. No doubt there are many causes. I might just mention one—the fact that the unspeakable Marshal who now nominally rules in France strove to cover up his own poltroonery with a gloss of sanctity and conservatism. That is one cause but it would be idle now to go into the causes and, as I have said, it is all so very absurd. It is just as absurd as if a charge had been made against Mr. Asquith and Sir Edward Grey of wishing to abet the cause of autocracy, of spreading autocratic principles throughout the world, because of their alliance for the purpose of the war with the Tsar's Government. But no doubt there are plenty of people in this country who wish it to be true and no doubt are working that it shall be true; but at any rate, whatever he the case, it is a most priceless asset to Goebbels.
Take the case of Italy for example. There are multitudes in Italy who hate Fascism, but they also remember the anarchy that prevailed before the Fascists came into power—factories seized, officers and officials murdered, communications broken down, unemployment and scarcity everywhere—and if they think and if they can be got to think by Goebbels that they have to choose between Fascism and their former anarchy they
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will cleave to Mussolini as the lesser evil. There are in Italy two particular circumstances which will aid Goebbels in his efforts. One is the tradition of British policy dating from Canning, Palmerston and Gladstone, all undoubtedly abetting what were then—I will not call them Left elements, but at any rate elements opposed to the Government in various countries. In those days of Canning and of Palmerston and Gladstone the terms Right and Left, if used at all, had very different meanings to what they have now. Nevertheless, there is that tradition and a suspicion among many on the Continent, not only in Italy but perhaps particularly in Italy, of that trend. And there is also the use of the word "democracy." Its use by us and in America connotes an orderly form of popular Parliamentary government quite compatible with monarchy but in many countries of the Continent what it means is simply the Jacobin tradition and red revolution, and you may see how easily that will influence what I may call stable elements in Italy.
Then take Hungary. Hungary had its nadir of suffering and humiliation in 1919. I came across one small example of that myself some years ago. I spent some weeks in a village in Hungary and there was a lady living just outside the village on a small property who was the widow of a leading civil servant in Budapest. Now this lady's husband, for no other reason that I could hear of except that he was a civil servant, was seized, had weights tied to his wrists and ankles and was thrown into the Danube. That lady is one witness among many of what took place then and if the Hungarians have to chose between Hitler and Bela Kun they will vote for Hitler every time.
Now I will say a word about Germany. My argument is quite unaffected by the question of future security. It is a matter quite different and apart from that. I agree at one point, and one point perhaps only, with Lord Vansittart, that we have to take exactly the same precautions whatever kind of Government may be in power in the future in Germany. Democrats may be just as aggressive and just as unscrupulous as tyrants. Napoleon was no more to be feared in his aggression and unscrupulous methods when he was Emperor than the Jacobins were when Napoleon was their humble servant. Therefore I put that aside in my argument. What I am concerned with is not

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the future precautions but the present speeding up of a triumphant peace. Now there are many enemies of Nazism in Germany—the big industrialists, the landowners, including peasant landowners, the people who used to be called Majority Socialists, and in particular the sincere adherents of the two great Christian bodies. It will be hard in any case to reconcile these men and women to defeat or to enable them to accept defeat, but Goebbels has a special argument in this connexion. He twisted with some skill our declaration about unconditional surrender. We, of course, meant the unconditional surrender of the forces controlled by the Axis, but he endeavoured to persuade his country that it means the total annihilation of Germany and the reduction of the German people to the same system of helotry to which they have reduced others. If he can put it to them that unconditional surrender means this, and means surrender to foreign Communism, there will be a very much harder struggle that we shall have to face. It needs no imagination to see how resistance will be strengthened and the war prolonged if he is successful in this effort.
Like conditions apply to occupied countries and to neutrals. What I trust is that our Government will bear this in mind and make it clear that their policy is something that will mitigate these anxieties in all countries. Of course it may be argued that usurpation might come not from the Left but from the Right in some countries. I can imagine that being said about one or two countries. But the principle of the Atlantic Charter, if properly applied and made effective, would combat any usurpation from the Right or from the Left. Of course in the case of Germany it is obvious there would have to be perhaps a long purgatorial period, but none the less the principle of ultimate free choice should be kept alive, so that at any rate they may feel that everything is not over with them on the conclusion of peace. I say this in no spirit of tenderness for the enemy but in order, it may be, to make the struggle shorter and the peace more real. It may make all the difference whether we have to face a united and desperate or a defeated and disheartened enemy.
THE LORD PRIVY SEAL (VISCOUNT CRANBORNE): My Lords, His Majesty's Government
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are very glad to give the answer for which the noble Lord, Lord Rankeillour, asks; but, as you will understand, it is rather difficult to give a precise reply to him. As your Lordships are aware, the Atlantic Charter was a bilateral declaration of intentions to which a large number of other nations subsequently subscribed. It is therefore manifestly impossible for His Majesty's Government who are only one party to this agreed statement to put without consultation with the others any special interpretation upon any particular passage. Moreover, it seems to me most undesirable to do so. The Atlantic Charter does not seek to explain how the broad principles proclaimed by it are to be applied to each and every case which will have to be dealt with when the war comes to an end. At this moment, when it is impossible to say in what circumstances they will fall to be applied, it would be most unwise to enter into discussions as to exactly how this or that Article is to be interpreted. The Motion of the noble Lord is, I think, an apt illustration of this point. As drafted it applies to any country in Europe, that is to say enemy, Allied and neutral. I do not suggest for a moment that the noble Lord intended to apply it to neutral countries but—
LORD RANKEILLOUR: No, I ought not to have brought in the word "neutral."
VISCOUNT CRANBORNE: But even with regard to the other two categories it is barely conceivable that the policy of the Allies would be identical. In relation to enemy countries, for instance, I should have thought that the policy of the Allies had been made abundantly plain. It is to bring about their total defeat and the destruction of the Governments which have been responsible for provoking this war. It would clearly be impossible for His Majesty's Government unilaterally to define now the further steps which the Allies jointly may decide it is necessary to take in order to prevent in the general interest any repetition of aggression or threat to world peace. I am sure that the noble Lord would not suggest—I do not think he did in fact suggest—that full freedom should be accorded to enemy countries immediately after their defeat to choose Governments, of whatever kind, whose first act might be to plunge the world again into war. I hope, in saying

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this, I shall not be taken as accepting my noble friend's view that democracies may be as aggressive as tyrants. In my opinion, recent history does not bear that out.
Towards the Allied countries I think the policy of the Allies is equally plain. It is to see that their sovereign rights and self-government are restored to those who have been forcibly deprived of them. The method and manner of such restoration When it takes place it is impossible at present to foresee. In certain cases, when we have received the unconditional surrender of the Axis forces, it may be a comparatively simple and rapid process. Loyal elements will presumably take charge and a legitimate Government will be rapidly re-established. In other cases it may be a lengthy process. The defeat of the Axis may be followed by a period of unrest. The policy of the Allies in those circumstances will certainly be to restore order as rapidly as possible and facilitate the restoration of legal authorities. In the widely different circumstances of the countries in question and in total ignorance of the conditions that will prevail in them, it is not in the nature of things possible to lay down any general method of practice or procedure. But I can assure the noble Lord—and I think his is really the assurance he wants—that the aim of the United Nations will certainly be the re-establishment of Governments representative of the wishes of the peoples concerned.
LORD RANKEILLOUR: My Lords, I thank the noble Viscount and I think I am satisfied with what he has said. I certainly meant that the wishes of the people should be really established and that no attempt to usurp a de facto Government should take place. I quite understand that no absolute assurance as to the method of this can be given now, but I am not sorry to have elicited so much as the noble Viscount said. I beg leave to withdraw my Motion.
Motion for Papers, by leave, withdrawn.

POST-WAR FORESTRY: COMMISSIONERS' REPORT.
THE EARL OF ABINGDON: My Lords, my noble friend the Duke of Sutherland, who is unable to be in his place, has
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asked me to put the question standing on the Paper in his name.
[The question was as follows:
To ask His Majesty's Government, whether any decision has yet been reached as to the publication of the report of the Forestry Commissioners on post-war policy, and as to the date of publication if that has been decided upon.]
THE LORD CHANCELLOR: My Lords, the report will, I hope, be published before the Whitsun Recess.

TRAINING OF W.A.A.F. OFFICERS.
LORD WINSTER LORD WINSTER had given Notice of the following question: To ask His Majesty's Government whether the curriculum at a school for W.A.A.F. officers in the North-West of England has been considered by the appropriate authorities, and whether they are satisfied that no subjects are taught which are not directly related to the purposes for which the W.A.A.F. is recruited.
The noble Lord said: My Lords, I wish to say a few words in explanation of the question on the Order Paper, but in view of the lateness of the hour I will compress them into two or three minutes. I thank my noble friend Lord Sherwood for waiting to reply to me and I express regret that he should have had to wait so long. My question arises out of an article which appeared in the Press concerning a school for W.A.A.F. officers in the North-West of England. I have brought the article to the attention of my noble friend and I would like to emphasize, if I may, that nothing I may say is intended in any way as a criticism of the W.A.A.F., for whom, like everyone else, I have the highest admiration. If I may say so, having watched them march past many times, I think their march discipline the best of any of the Women's Auxiliary Services. Nor do I wish to say a word which would be in any way a discouragement to those in charge of this school. I am sure they are making most praiseworthy efforts and doing very useful work.
This school, according to the accounts, is designed to train W.A.A.F. cadets in matters pertaining to R.A.F. organization and administration, pay, equipment, legal assistance, discipline, travelling, hotel

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management, accounts, signals, catering administration and equipment. Those are the purposes for which the school exists and the account goes on to say that the syllabus is very wide. I think the word "wide" is an appropriate word for I think it is wide of the mark, having regard to the objects for which the school exists. I say wide of the mark because, according to this account, the courses include the historical development of the nineteenth and twentieth centuries, art, literature and music, and I confess that I am unable to see the bearing of any of these subjects upon the objects of the school which I have just read out. I will omit many things which I had thought of saying on this subject, and really I have no wish to drive the matter into the earth for I agree that all work and no play makes Jill a dull girl. But I think that many of us know that those connected with such establishments as this are rather inclined to let their enthusiasms take charge of them in matters where welfare, culture and uplift are concerned.
In spite of having read this article, I would not have raised the matter in your Lordships' House were it not that quite recently I happened to be in conversation with the Commanding Officer of an establishment where one of the Women's Auxiliary Services is under tuition and training. He expressed very great concern to me about the fact that the syllabus for these girls had this tendency to widen and expand into subjects which he thought were of very little use indeed. It is because of that information, given to me by this officer, who certainly ought to know, that I have brought the matter forward. I think that it is very necessary to keep these matters within bounds because every subject you add to a syllabus means more staff, more time and the expenditure of more money. For these reasons alone I think this is of great importance, and, therefore, I ask my noble friend if, in replying to me, he can at any rate give some assurance that the syllabus of this and similar schools will be very carefully re-examined in order to ensure that only subjects are taught which will fit the girls for the war purposes for which they were recruited.
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR AIR (LORD SHERWOOD): My Lords, my
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noble friend Lord Winster has asked me two questions. One is whether the curriculum at a school for W.A.A.F. officers in the North-West of England has been considered by the appropriate authorities. The other is whether those authorities are satisfied that no subjects are taught which are not directly related to the purposes for which the W.A.A.F. is recruited. The answer to both questions is "Yes." The training syllabus at this school is, of course, laid down by the responsible member of the Air Council, who is the Air Member for Training, and his advisers. He is responsible for laying down this syllabus, and we are quite satisfied that it is a proper syllabus.
The noble Lord has gone a little further into an article which appeared in a newspaper on May 22. I would like to say that it is an article which was written by a special correspondent, a very highly-trained lady, who went to this establishment and reported on what she saw. But, of course, what she wrote is not necessarily a report of what happens. I think that it was rather a good report concerning the school, and the correspondent said in it that a great deal was being taught which was going to be of lasting value. In fact she used the words: "Here a piece of work of lasting value to the nation is being done." Now there are really four courses at this school. Three of them deal purely with the essential matters of service training. The fourth happens to be an Officer Cadet Training Unit course, and this is one of those courses set up with the approval of your Lordships' House, and the Press, in conformity with the Report of the Markham Committee. The Committee reported that there should be, for those people who were going to be officers, some enlargement of what they were taught in the three courses to which I have alluded.
I will admit that the article does make it seem as though some things not absolutely essential to the war effort were being taught. This could give rise, as it has done in the case of the noble Lord, Lord Winster, to the idea that we were not concentrating to as full an extent as we should in war-time on a single object. But if one looks at the syllabus with respect to the question of cultural teaching, one sees that out of this weekly course, which occupies fifty-six hours, only one hour is devoted to it. Of course the students are not taught

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the history of the nineteenth and twentieth centuries. That is not attempted. But during this, course a good many things, such as art, crafts, music and history, are touched upon in order to help those who are going to be officers so that they will be able to deal, to the best advantage, with people subordinate to them. The purpose is to indicate to them how they can arouse the interest of their subordinates and bring out the best that is in them.
This is only an officers' course and it deals in fifty-six hours with a great many subjects. I will not go into them all now, but one which was certainly rather dwelt on in the article really occupies only one hour out of the fifty-six. I assure your Lordships and my noble friend Lord Winster—to whom I am very grateful for bringing this matter forward—that this syllabus is a proper one and that it is in
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conformity, even though it is perhaps not all we should like to be able to give, with the conditions asked for by the Markham Report. I am quite certain that if the noble Lord will see me afterwards, and will look at the full syllabus, which I shall be glad to show him, he will see that there is no waste of the war effort, and that in fact everything that should be done is being done in connexion with this course.
LORD WINSTER: My Lords, I beg to thank the noble Lord for his reply. I quite appreciate that what is being done is in conformity with what has been laid down, but I am not satisfied that what is laid down does not contain a great deal of extraneous matter having regard to the purposes which we have at the present time to accomplish.
House adjourned.