Sitting of 1 November 1946

Preamble
The House met at Eleven o'Clock
PRAYERS
[Mr. SPEAKER in the Chair]

NEW WRITS
For the Borough of Bermondsey (Rotherhithe Division), in the room of the right honourable Sir Ben Smith, K.B.E. (Manor of Northstead).
For the Borough of Paddington (North Division), in the room of Lieutenant-General Sir Frank Noel Mason-Macfarlane, K.C.B., D.S.O., M.C. (Manor of North-stead).—[Mr. William Whiteley.]

ORDERS OF THE DAY

  SUPREME COURT OF JUDICATURE (CIRCUIT OFFICERS) [MONEY]
  Resolution reported:
  "That, for the purposes of any Act of the present Session to amend the law relating to clerks of assize and certain other circuit officers, it is expedient to authorise the payment out of moneys provided by Parliament of—
  (a) salaries, pensions and allowances which, by virtue of the said Act, are payable to or in respect of clerks of assize under the Supreme Court of Judicature (Consolidation) Act, 1925; and
  (b) remuneration payable to circuit bailiffs."
  Resolution agreed to.

  SUPREME COURT OF JUDICATURE (CIRCUIT OFFICERS) BILL [Lords]
  Considered in Committee.
  [Major MILNER in the Chair]
  CLAUSE I.—(Appointment, qualification and conditions of service of clerks of assize.)
  11.8 a.m.
  Mr. Rees-Williams: I beg to move, in page 1, line 8, after "barrister," to insert "or solicitor."
  926
  The object of this Amendment is to prevent the Lord Chief Justice from being obliged to appoint barristers, and only barristers, as clerks of assize. If the Bill is passed with the Clause as it stands, the effect will be to limit the choice of the Lord Chief Justice to one branch of the legal profession. This Clause changes the law. At present, those who have the choice of clerks of assize may appoint barristers, solicitors or other persons if they so desire, and this change, I suggest, is an undesirable limitation to one branch of the legal profession; in fact, as I pointed out on Second Reading, it is the closed shop at its worst. It has been supported, of course, by hon. and learned Members on both sides of the House on that ground, and it will be very interesting in the next Session when, as we understand, the closed shop is to be discussed, to hear the arguments of the right hon. and learned Member for the West Derby Division of Liverpool (Sir D. Maxwell Fyfe), of the hon. Member for Wirral (Mr. Selwyn Lloyd), and of other supporters of the closed shop principle in their own profession when it comes to dealing with the closed shop for the workers. We shall expect some extraordinary somersaults to be performed on that occasion or we shall expect them to come into the Lobby with us.
  There are two ways of dealing with this matter in fairness. The first way is by throwing this office entirely open as, in fact, it is now, and there are arguments for that. The second way is by throwing open the office of clerk of assize to the whole of the legal profession. The arguments are nicely balanced. In the main, I prefer the second one. I think the Lord Chief Justice would probably consider it desirable to appoint someone with legal qualifications. But I would not object, myself, if the Solicitor-General so desired, to the first argument, that is, to leave the position as it is now.
  There is no defensible argument, in my view, for the proposition under this Clause. It is an indefensible position, which has been maintained by the Solicitor-General and the right hon. and learned Gentleman the Member for West Derby. My object is to give the Lord Chief Justice power to choose the man he desires for this post, whether he be a barrister or a solicitor. If we have a thoroughly trustworthy man as Lord Chief Justice, and a

  927
  distinguished lawyer in that position—as we have now—why fetter his power to choose the man he really desires? It is defended by the Solicitor-General, apart from the closed shop principle, on these grounds. On the Second Reading, my hon. and learned Friend said:
  "I would remind the House that it has been possible for years for solicitors to be clerks of assize under the terms of the Supreme Court of Judicature Act, 1925. and I think I can say without fear of challenge that no solicitor has been. I presume they never wanted to be; they have not been in fact." —[OFFICIAL REPORT, 25th October, 1946; Vol. 428, C. 184.]
  For that presumption the Solicitor-General has no foundation whatever, because solicitors have never had the opportunity of being clerks of assize. If the posts had been advertised he would probably have been surprised at the number of solicitors who would have applied. Owing, however, to the method of selection of clerks of assize in the past, solicitors have not had the opportunity of applying. Clerks of assize have been appointed by the next judge going on circuit. The position has never been advertised, and the profession as a whole has been neglected and given no opportunity of applying. The suggestion in this Clause seeks to turn what has been for many years an administrative racket into a legislative one, to keep to one branch of the legal profession an office which is more suitable to the other. I suggested, on the Second Reading, reasons why I think solicitors are more fitted for this office. They are more fitted because they are trained in administration, they go into the solicitors' profession because they like administration or office work, or, at any rate, feel themselves more fitted for it than as pleaders at the Bar. Further, one is more likely to get a better man if a solicitor is available than if only a barrister is available, because a good barrister will not choose this dead-end profession. It is not the type of career which in the normal way he would set out to achieve when he was called to the Bar.
  This is a retrograde step, because we hope for fusion and more collaboration between the two branches of the profession, rather than for severance. There are other Members who wish to speak on this Amendment, so I will say little more, except this: I have found, since I have been a Member of this House, that if one puts up a good case to the Government,
  928
  and they are assured that it is just, they will generally accept that case. On several occasions when I have moved Amendments the Government have accepted them, after hearing the opinions of those on the Floor of the House, or in Committee. I therefore ask the Solicitor-General to accept this Amendment or, at least, to retain the present position. I ask him that in all sincerity, because I feel that the principle incorporated in this Bill is entirely unjust, and furthermore, may cause considerable administrative inconvenience in the future.
  11.15 a.m.
  Mr. Leslie Hale: I rise to support this Amendment, and to put the view of my trade union in this matter. I make no apology to the Committee for speaking on behalf of my trade union when their particular rights are affected—
  Mr. Turner-Samuels: My hon. Friend says that he is speaking on behalf of his trade union. I am sure that he does not intend that, because it is rather misleading. I know of no representations which have been made by the Law Society to further the object that my hon. Friend apparently has in view in supporting this Amendment.
  Mr. Hale: It it Friday morning, and if the Committee are to discuss all the things that my hon. and learned Friend does not know, we shall be here for a long time. The Law Society have made representations to the Solicitor-General on two occasions, and have circularised every solicitor Member of this House. They have put the strongest emphasis on this matter. I feel much more strongly about it, because of the ill-informed intervention made by the hon. Member for Huntingdon (Mr. Renton) last Friday. The hon. Member said that if solicitors were put in, they would need a long experience and a high standard of experience, to justify their holding this important position. What are the facts? The standard of legal education demanded by the Law Society for solicitors is infinitely higher, longer, and more arduous than that which is asked from barristers by the Bar Council. There is a reason for that. For revenue purposes, the Bar Council appoint barristers who have no intention of practising, although I know that there are many members of the Bar who have acquired a very high standard of legal

  929
  knowledge. The hon. Member's intervention was unjustifiable and improper.
  The Solicitor-General was asked to say what the duties of the clerks of assize were, and, with all due respect to him, he did not seem to know a very great deal about their duties. Perhaps the reason is that they do not perform any duties at all. My hon. and learned Friend said that one of the principal qualifications was that the clerk of assize must be a member of the circuit mess. Later in the Debate, there was some discussion as to whether my right hon. and learned Friend the President of the Board of Trade would reach the necessary standard of conviviality to be available for appointment as a clerk of assize. The duties which a clerk of assize performs are essentially those which are performed by a solicitor. According to the definition in Halsbury's "Laws of England," they "perform all circuit functions of master or assessors." They are so appointed, and they perform this office substantially to the people's satisfaction. The second duty of the clerk of assize is that of taxing master He taxes the bills of the prosecution, and certain poor people's defences. That, again, is essentially a job performed by a solicitor. It was said by the Solicitor-General that the clerk of assize must keep in touch with the Bar. It is the solicitors who arrange the summoning of witnesses to assize, and who conduct all the preliminary negotiations. In other respects, the real functions that he performs are those which have, for generations, been successfully performed by members of my profession.
  If the Solicitor-General really lays down the circuit mess test, he ought to introduce an Amendment to say that the clerk of assize must be a barrister of less than five years' standing, must not be a teetotaller and of a sufficiently convivial nature to perform the functions of his task. But I suggest that these limitations are very undesirable. If this matter had been discussed in the last Parliament one could have understood someone saying that this was a very important position. We might prefer that no one should be appointed to hold office under the Crown who has not been engaged as counsel for five years, and, had it been put, that argument might have been accepted. But the result of that would have been that the learned Solicitor-General would not be here to put the case today because he
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  would not comply with the limitation, and I say, with very great sincerity, that that would have been a very great disadvantage. I am sure that both sides of this House regard him as an outstanding member of his profession, who brings a very considerable learning and a mass of information on every subject under the sun, except clerks of assize.
  The Solicitor-General intervened on Friday last on this aspect of the matter, but, again, he brought forward no argument at all for this exclusion. The main point is that this is really a retrograde step, and, as the hon. Member for South Croydon (Mr. Rees-Williams) said, we are anxious to see the whole subject of these appointments brought under consideration, and if the weight of the House is given to a limitation which excludes solicitors from holding these appointments, it is no argument for the Solicitor-General to say that they shall not be masters or registrars of the court. The functions of a registrar in the county court today are varied and important, and are nearly always performed by solicitors. The Solicitor-General put one other argument, saying that, in his investigations, he did not remember a solicitor holding this job. It is an appointment which falls to be made by a senior judge when he happens to be on circuit. I do not say this in any spirit of criticism, but it is one of the little offices of profit in which a distinguished judge could put someone, necessarily someone holding the proper qualifications, but having the additional qualification of being someone he knew or liked. No one could object to that. A little judicious nepotism has crept into these matters without any serious effect, and I do not make too much fuss about it. Now, we are saying that, in the case of a paid, full-time appointment, it is clearly quite wrong to put in this limitation. It is a piece of pure class legislation. We have taken steps, to some extent, to democratise our branch of the law, though I do not think we have gone nearly far enough, and I hope no one will accuse me of expressing satisfaction. The two distinguished gentlemen who are now carrying on my own practice in the country, both came to me as lads from school. The only justification which the Solicitor-General puts forward for the course now proposed in the Clause is a class classification, and it is an argument which should not be put

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  from our Benches at all. I ask the learned Solicitor-General to reconsider the matter and accept this very modest Amendment.
  Mr. Boyd-Carpenter: When the hon. Member for South Croydon (Mr. Rees-Williams) spoke on the Second Reading of this Bill last week, he very properly, to my mind, described the proposal of the Bill as it stands as being an example of the closed shop. The hon. Member denounced the closed shop in language so forcible that I am perfectly certain that hon. Members on this side can look forward to his support when this issue is raised next Session, and perhaps on more important matters than this.
  Mr. Rees-Williams: What I denounced was the humbug of right hon. and hon. Members opposite advocating a closed shop in their own profession and denying it to the workers.
  Mr. Boyd-Carpenter: I am much obliged to the hon. Gentleman, who denounced the closed shop with so much skill and with so much technical knowledge of the subject, and it is perfectly obvious that he regards the closed shop as a tyranny. But it is a little strange that the Amendment we are now discussing is an Amendment which seeks to include solicitors and it appears on the Order Paper in the name of three hon. Members of that profession. It would appear that as far as the hon. Member for South Croydon is concerned, his denunciation is not of the closed shop as such, but of the shop that is closed a little bit too much. I remain quite unrepentant on this point I think the Amendment of the hon. Member for South Croydon is quite a good one and I shall certainly vote for it. None the less, it does not go far enough, and the Bill does introduce a most undesirable closing of the scope of these appointments. It is fair and right to say that the Amendment does amount to an improvement, in so far as it permits the junior branch of the legal profession to be considered for these appointments.
  Mr. Hale: I am quite sure that the hon. Member did not intend to refer to the "junior" branch. There is no authority for that. They are independent branches and neither has ever asserted its seniority, nor would either have been justified in doing so.
  Mr. Boyd-Carpenter: I am sure that no one would cast the stigma of juniority upon the hon. Member, but I regard the conventional description of solicitors as the junior branch of the legal profession as being so hallowed by custom, that I propose to use it. I hope this House will discuss this question, not from the narrow point of view of the interests of one profession or another but from the more important standpoint of the interests of the public, and, in particular, from the standpoint of how best these very important appointments are to be filled. I was a little surprised, for that reason, that both the mover and supporter of this Amendment spent a considerable time in pointing out how excellent their profession was, and spent no time at all in pointing out how the public interest would be served by the acceptance of their Amendment.
  Mr. Sydney Silverman: Surely, the change is being introduced by the Bill. I think that, in the Bill as presented, there was no such limitation as the one we are now seeking to remove, and any onus of proving that the public interest is to be served lies upon those who want to make the change, and not upon those who do not.
  Mr. Boyd-Carpenter: I entirely agree with the admirable exposition of Conservative doctrine by the hon. Member for Nelson and Colne (Mr. Silverman). As always, the hon. Member expresses the point of view he is maintaining for the moment with great force, and I entirely accept it. None the less, the fact remains that the change is effected by this Bill, which was given a Second reading last week, and I therefore think it is desirable, that, on this Amendment, the merits of the question should be looked at, not from the point of view of narrow professionalism, but from the point of view of the public interest.
  I entirely agree with what was said by the hon. Member for South Croydon about clerks of assize. There is a certain rough similarity between their functions and the functions of clerks to justices, but with this difference—that, whereas clerks to justices have to advise the justices on the law, advice offered by the clerks of assize in their court on law might not be received by the recipients with any undue enthusiasm.

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  That, as far as it goes, is an argument for a solicitor being able to discharge these functions. The Bill, very properly, transfers these appointments to the Lord Chief Justice, and I do not think it could be seriously suggested by the Solicitor-General or anybody else that the Lord Chief Justice of England is not competent to select a man for the job. When we are putting these appointments into such highly responsible and skilled hands, what is the need for these limitations and safeguards? Indeed, when one reflects on the source from which Lords Chief Justice of England are so often selected, one wonders a little at the learned Solicitor-General himself going out of his way to impose limitations upon the holder of that office. It may be that the day will come when he will regret the imposition of such limitations.
  11.30 a.m.
  Possibly, to non-legal Members of the House, the point is not of very great importance. None the less, it seems to me—and there I agree with the hon. Member for South Croydon—that although small, it raises a question of principle of some considerable importance. There is far too much tendency today to limit appointments to people within various unions, various "closed shops"—within, if I may use the phrase, various "rackets" —and it is time that Parliament made it perfectly clear that the process must stop. I am quite certain that the hon. Member for South Croydon, who spoke so well on this point on the Second Reading, is entirely sincere in putting forward this Amendment, and, from what I know of him, I am certain that, having put forward this Amendment so well, if the Government will not accept it, he will not shrink from putting the matter to the test of a decision by this Committee. I am certain the hon. Member is not the sort of person who would withdraw an Amendment in these circumstances, and I hope he will receive support not only from members of his union but from members of my union, and from those hon. Members, who are the majority, who dislike both unions with equal impartiality.
  Mr. Turner-Samuels: I am sure we were all entertained and very much instructed by the robust intervention of my hon. Friend the Member for Oldham (Mr. Hale). I quite understand
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  his point of view because, naturally, he is speaking on behalf of his profession, and it has been said both by him and by the mover of this Amendment that we ought not to look upon this as a class matter, that we ought not to discriminate. That is a view which I very heartily share, but it seems to me that the attempt which is being made in the Amendment is to do that very thing, because, as the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) said, not a word do we hear in respect of any other section of eligible persons for these offices except that of the solicitors' profession. The worst service that we can pay to anybody, either to the legal profession or to the public, is to try to narrow down this matter to a competition between sections of the legal profession. That is the worst thing we can possibly do. It seems to me that the test we have to apply is, again as the hon. Member for Kingston said, what is best in the interests of the public service? That is the only criterion by which this matter ought to be decided. I do not desire to minimise the status of the solicitors' profession, or to suggest in any way that that profession is not a very competent and efficient one. Indeed, I would be putting myself, as a member of the Bar, professionally in a very precarious position if I were to make any such suggestion. But I do want to try to avoid letting my partisanship override my judgment in this matter.
  Let us make one or two tests by which I think the Committee can be guided as to what ought to be done. In saying that, I ask the Committee to discard from their minds any question of prejudice in this matter, and to treat it merely as one of sense and judgment, without regard to any section of the profession at all. Let us make one cardinal test which seems to me to be a supreme one. In dealing with this matter we have experience upon which to draw. After all, there is some history in connection with clerks of assize, in the functions of clerks of assize, in the administration of justice and in the machinery connected with the assize courts. Therefore, we have that body of experience upon which to draw. What is the result of that? I think it is perfectly correct to say, notwithstanding what the hon. Member for Oldham said, that in no instance has there ever been an appointment of a solicitor to this office. I quite agree that that in itself is not necessarily—
  Mr. Hale: Is the hon. and learned Gentleman arguing that, because at one stage no commissions in the Army were given from the ranks, that is a reason to continue that state of affairs now and to make it statutory?
  Mr. Turner-Samuels: If my hon. Friend will be a little patient and not so enthusiastic, he may follow what I said. My point is that that argument may be an exclusive one, but not a conclusive one. After all, there is a very strong body which represents the interests of solicitors and, in spite of what my hon. Friend says, I have never seen it put forward with any degree of force at all that solicitors ought to be appointed to this office.
  Mr. Janner: I assume that my hon. Friend is prepared to accept the fact that the Law Society has put forward this proposal and is supporting it?
  Mr. Turner-Samuels: I am coming to that point. My hon. Friends must be a little patient. The Law Society has not made any effort with any force—[Interruption.] My hon. Friends should contain themselves for a few moments and try to listen to the other side of the argument, because that is the only way in which one can come to a conclusion on anything. The Law Society has made a very slight effort in this matter. I think two letters have been written by them about it, and I think it is right to say that no serious argument has been put forward by the Law Society in support of appointing solicitors to this position. Why is it? I submit that the fact that there has never been such an appointment is an argument; it is not a conclusive one, but it is an argument to explore. In my opinion, the reason is that the duties of a clerk of assize are very special indeed, and it is not a position which is suitable to any appointee other than a member of the Bar with the experience that a barrister has in these particular matters.
  First of all, the assize court is the highest criminal court, apart from the Court of Criminal Appeal. This is a matter which has to be very carefully considered, because one has to consider what is the function of a clerk of assize. Those of us who have been associated with these matters and have seen what proceeds in that connection, know that the clerk of assize holds a very important
  936
  position. I doubt whether there is a single sentence imposed by a judge which has not been previously discussed with the clerk of assize.
  Mr. Hale: So what?
  Mr. Turner-Samuels: Hon. Members who do not like to listen can always go outside. That is a very important matter, because it sets the standard of the sort of qualifications and capacity one must have in order to be a clerk of assize. I do not think it can be gainsaid that a solicitor does not accumulate that experience or the necessary qualifications for that very important work, and that is a consideration which should be borne in mind by this Committee. Again, the clerk of assize is to be in the position of a King's Bench master. Now, there is no master of the King's Bench who is a solicitor; indeed, a solicitor is not qualified to become a master of the King's Bench.
  Mr. S. Silverman: What about the taxing master?
  Mr. Turner-Samuels: A solicitor is not qualified to become a master of the King's Bench.
  Mr. Hale: The Committee are entitled to know the facts. Throughout the country the whole of the functions of a master of the King's Bench are administered by the registrar, and he is invariably a solicitor; taxing masters in the King's Bench are solicitors; masters in Chancery are solicitors. However, this curious, archaic reservation referred to by my hon. and learned Friend does exist. and should not exist.
  Mr. Turner-Samuels: Of course, we know that registrars of the county court who are district registrars of the High Court are solicitors. I know that, but I was not referring to that. I was referring to King's Bench-masters. By this Bill it is sought to raise clerks of assize to the equivalent position of King's Bench masters. There is no doubt about that. Therefore, because they have to perform functions that are very similar, it is not a position which is open to a solicitor. Another matter which makes the appointment of a solicitor to this position absolutely illogical under this Bill is the position of associates. My hon. Friend has not said a word about associates. Under this Bill the associates

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  who are to be appointed will be members of the Bar. I may be wrong, and perhaps again he will correct me, but I do not know of any associate of the High Court who is not a member of the Bar. We shall get this illogical position. If we allow clerks of assize to be appointed from the solicitors' profession we will exclude them from being appointed as associates. I ask the House to take that into consideration. The matter is very technical; I quite see that. Non-legal Members of the House will probably find it very difficult. It is so very easy to raise prejudice about this matter by saying that someone will be excluded from this appointment. That immediately raises a prejudice. In fact, in my submission there is a very good reason for doing that. To my mind the point about associates is a very strong argument for making the appointment of clerks of assize equate with that of the appointment of associates. I do not wish to go into any of the other matters. There are quite a number of other matters, but I am quite certain they will be dealt with by a number of my hon. Friends who apparently want to speak. I conclude by saying that in this particular case it is not a question of the closed shop. In this particular case, in order to serve the public interests these officers should be drawn from the profession of the Bar.
  Mr. Berry: The hon. and learned Gentleman has referred to the public interest. Surely, it is a matter of law which is being discussed, not justice?
  11.45 a.m.
  Mr. Sydney Silverman: It is customary in the Committee, when a Member speaks on a matter in which he might conceivably have an interest, to disclose it. I would like to say at once that I am a member of that branch of the profession of the practice of the law which, if the Bill goes through unamended, will be excluded from these offices. In view of the remarks made by my hon. and learned Friend the Member for Gloucester (Mr. Turner-Samuels) I would also like to say that there is a solicitors' group, of which I have the honour to be chairman. I cannot say that we have ever met to discuss this point, but I think I am entitled to say—and those other solicitors who are members of the group, and who are here,
  938
  authorise me to say—that this Amendment will have the support of the whole group without dissension, irrespective of party.
  Althougn there is obviously a professional interest involved—and it would be quite stupid to deny it—that does not mean to say the public interest is not being served, too, by this Amendment. I deny altogether the allegation. A change in the law of the Constitution, the social basis or the economic basis of our country, ought to be supported by those who advocate the change, and the onus of proof is upon them. That is not a Conservative principle at all—or if it is, it is equally a Socialist principle. So far as this party is concerned, we have never refused that onus. We have assumed the onus on every occasion that we have advocated any change; that is to say, the onus of proving that the change is necessary and desirable, and would produce good results. I am bound to say that on the last occasion on which the question was litigated we satisfied the court very handsomely. That is why we sit on these Benches instead of on the Benches opposite. The public interest is very clearly involved. It is all very well to make cheap jokes about distinguishing law from justice. Anybody can do that; it is very easy. But those who do it ought also to assume the responsibility of saying how else justice is to be administered in any civilised community except by law and the machinery of law, however inadequately administered, with whatever deficiency, and in whatever way it is capable of improvement. The fact remains that on the administration of the law depends the existence of social justice in this or any other civilised community.
  What is suggested here is that in the discharge of an important office one branch of the legal profession should, for the first time, by Statute, be excluded. It is all very well to say, "Oh, but barristers have always done it," as did the hon. and learned Gentleman the Member for Gloucester. I do not think he would make a very good clerk of assize himself. He began by not knowing who the parties were, and went on to display a really shocking ignorance of how law is administered in this country. He seemed to assume that because in the King's Bench alone, and in London alone, such functions as those of a master were discharged only by barristers, that proved

  939
  that only barristers are fit to or ought to discharge them—
  Mr. Turner-Samuels rose—
  Mr. Silverman: I would like to finish my sentence before giving way. The facts are, the same functions in the Chancery Court, even in London, are performed exclusively by barristers, and outside London those functions are performed, both on the Chancery side and on the King's Bench side, exclusively by solicitors.
  Mr. Turner-Samuels: All I said was that these gentlemen were being promoted to a position equivalent to that of a master of the King's Bench, and that a master of the King's Bench—and I adhere to the statement—is always selected from the Bar, and that no distinction should be made in this particular appointment.
  Mr. Silverman: Nobody denies that that is what the hon. and learned Gentleman said, and nobody denies that the particular fact which he stated was correctly stated.
  Mr. Turner-Samuels: The hon. Gentleman is misrepresenting what I said.
  Mr. Silverman: The point is, the hon. and learned Gentleman drew wholly wrong inferences from it, and signally failed to understand the real implications of the fact he cited. I say, all these functions which he says, rightly, are so important are performed everywhere throughout the land, except in the King's Bench in London—and except there alone—by that branch of the profession which, unless this Statute is amended, will in future be prevented from carrying out those functions in the position of, at any rate, clerks of assize. I say the onus of proving that such a change, and such a limiting change, is vital or necessary, or would have good results, is upon those who advocate it. So far I have heard no single argument whatever in support of it —none whatever. Nobody has attempted to say why they should be excluded. I would be prepared to deal with the arguments if I had heard any arguments, but there have been none—none whatever.
  I hope it is not going to be said that solicitors are less judicially minded than barristers, especially after the experience we have had, in this House and outside. I once heard a High Court judge try a
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  case at assizes for four days. He reserved his judgment for 10 days, and then delivered a reserved judgment for an hour and forty minutes, and, after all that, proceeded to criticise the solicitor for having brought so trivial a case into the court. He is still on the bench practising judicial functions. Any one of us, from our experience, could multiply many, many instances of that kind. It is true on both sides of the profession. But it is by no means true that solicitors, by their training, its length, the standard of education required, or the length and variety of their experience, are not as capable of discharging this function as members of the other branch.
  My hon. Friend the Member for Oldham (Mr. Hale) said this was a retrograde step. So it is; and it is a step backward when we ought to be taking steps forward. I think, myself, that the whole question of advocacy in the courts, the existence of two separate branches of the profession at all, the exclusive appointment to judicial office of members of one branch of the profession, and even the limitation in the appointment of the Law Officers of the Crown to one branch of the profession—that all these are capable of inquiry, and capable of being reformed and improved. I hope that some day before this Government comes to an end we shall have a proper inquiry into the whole administration of justice in this country and the practice of both branches of the profession as well. I support the Amendment.
  The Solicitor-General (Major Sir Frank Soskice): We have had refreshing and invigorating speeches from three members of the solicitors' profession and two members of the Bar, and my intervention will even the balance. I hope that the Committee after hearing me will think I have been able to cut the Gordian knot. The point made by my hon. Friends who support the Amendment is, as I understand them, that on the question of suitability, solicitors should not be excluded. That seems to me to be a reasonable point of view. I would say this, however. This Clause, as drawn, is not intended to raise any question of general principle. Hon. Members have said that it does, but whether it does or not, having regard to what I propose to indicate as our intention, I do not think that argument will arise.

  941
  When the Clause was framed in the first instance the law depended upon Section 79 (2) of the Supreme Court of Judicature (Consolidation) Act, 1925. That Subsection provided that a clerk of assize must be one of three things: a barrister-at-law in actual practice, or a solicitor of the Supreme Court in actual practice, or a subordinate officer of the clerk of assize on Circuit. There were three special categories. When the Clause was framed the following circumstances were borne in mind. There are, seven clerks of assize. As I indicated on Second Reading—I am sorry that what I said did not find favour with my hon. Friends, and I repeat it with the utmost trepidation—it is the fact that for years past these duties have, as a matter of fact, been discharged by barristers.
  I was wrong in one particular, in that, years ago, I think, one solicitor was appointed. In view of what I am going to say I do not mention any names, and, indeed, I do not know the details, but I believe it to be the case that he was not a success, and that he was not a success because he did not have the knowledge that seemed requisite for the purpose. He could not see things from the point of view of members of the Bar. That may not be an argument to impress my hon. Friends very much. But I will not go into details, and I will not mention the name, because I do not know enough about the matter.
  The fact remains that for years this office, of very long standing, has been discharged without a word of complaint, so far as I know, by members of the Bar. Those responsible for framing this particular Bill, desirous of putting into its terms what they conceived the position should be, thought that clerks of assize should be drawn from the profession of the Bar because, for various reasons, it was thought that they could have more intimate contact with members of the Bar on circuit, that they would know the method of approach, and that their experience would make them more fitted to doing the very difficult and delicate business incumbent upon the office; and, therefore, in drafting the Clause, the profession chosen was that of the Bar.
  But the case is made that we should not exclude solicitors. I think it is a perfectly reasonable case, and I would accept that. As the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) pointed
  942
  out, the final choice rests with the Lord Chief Justice, and, whether he is limited to choosing members of the Bar, or whether he can choose, also, from members of the solicitors' profession, I am sure the Committee would unanimously agree that his discretion can be completely relied upon to choose a person who is wholly suitable. In those circumstances I attempt to cut the Gordian knot by saying that the Government will accept the proposed Amendment.
  Major Sir David Maxwell Fyfe: I feel that the Committee has some right to expect that we on these Benches should express our point of view. I said on the Second Reading that I thought it was, in practice, a good thing that a clerk of assize should be a member of the Bar. I thought so for reasons which I can put very shortly, and which, I think, the Committee ought to have in mind. The duties, as I have seen them—and some hon. Gentlemen opposite know that I have had a fair opportunity of observing them, even if I have not observed them correctly—are, first, that of arranging the list. The reason why some of us feel it very important that the clerk of assize should be in touch with members of the Bar is that the great bulk of criminal cases on assize are not heavy cases in which the defendant has to have a solicitor and counsel appearing for him. The bulk are cases where the defence is done under the Poor Persons' Rules, where a solicitor is often not allowed; or are done by means of counsel appointed by the judge or by the defendant in person. In the first of these examples it is the practical problem for the clerk of assize to arrange with the barrister who is conducting the defence and the barrister who is prosecuting, a time that will be suitable to all concerned.
  The second main duty—and this, I consider, is an important one—is that of advising judges, and, especially, the more junior judges, on the question of sentences and the standard of sentences. That is, in practice, as we all know, the method by which the clerks of assize, in fact, maintain a certain geographical standard of sentences in the cases on circuit.
  12 noon.
  Thirdly, there are intricacies of procedure, which may be small and seem un-

  943
  important at the time, but which often attain a quite different standard of importance if the case goes to the Court of Criminal Appeal, on which the clerk of assize does keep the judge right. As the hon. and gallant Gentleman mentioned the question of taxation, on that he did make a fair point, but I make a fair reply, I think, in this way: taxations of criminal bills are sui generis, entirely different from the taxations of civil bills, which are dealt with in the other places to which he referred. I have only mentioned these points because they are practical points and they did seem to me reasons, depending on the actual work and on the public interest, quite apart and entirely unconnected with any sort of contest of importance between the two branches of the profession. When, however, the matter is put to us on the basis of seeking to preserve an exclusive right to an office, and seeking to exclude a branch of the profession, as it has been put today, then the matter must be considered from quite a different angle.
  These are high considerations and I should be the last, having had the honour for a short time to be head of the English Bar, to press in this Committee or anywhere else an attitude which would at all appear to be one of selfish exclusion. Therefore, I do not seek that this Amendment should be resisted, and those who sit with me will, I think, join me in accepting its acceptance, if I may put it in that way. I think the whole Committee would like to convey its condolences to the hon. and learned Member for Gloucester (Mr. Turner-Samuels) on the condition in which he has found himself today. He has so often been an admirable political niblick to get his party and the Government out of a bad lie that it is hard, when he operates on the fairway, that he should not receive assent to his point of view. I think the Committee are now seized of the position taken by hon. Members who sit with me, in regard to this point.
  Mr. Janner: I want to make one point and I hope it will not be considered out of place now that the Solicitor-General has agreed to our Amendment. First, I should like to say that we are very grateful to him for having adopted this attitude, and having seen the light in time. We are also grateful to our friends on the opposite benches who have now taken the right step in the direction which we desired and
  944
  so enabled the public interest to be served. I want to make the point with regard to the public interest because it has been raised, and I think it is highly essential that the country should understand at this stage that the public interest can be served by men who are constantly in practice in the police courts. After all, this is a matter dealing with criminal law. The men who are in practice in, and who are administering, the police courts—
  Mr. Rees-Williams: Petty sessional courts.
  Mr. Janner: Yes, petty sessional courts. I was talking about the public interest and I wanted the public to understand what courts I was talking about; if I had said petty sessional courts they would probably have wondered which were meant. I am talking about the police courts as understood by the average individual. There one has to deal with the smaller cases referred to by my hon. Friend, and it is essential that men who understand that work shall be in a position to be administrators in the higher courts where similar case are being dealt with. It is in the public interest that men who are constantly administering the law should have this branch of the law open to them. That was the only point I wanted to emphasise because it had been said that it was not in the public interest for solicitors to act as clerks of assize or at least that the point had not been touched upon. It is highly essential that the public should realise that the solicitors' branch of the profession fully understand these matters and can advise the judges. My hon. Friend suggested that the clerk would have to advise the judge. A magistrates' clerk, or a man who has been trained in a magistrates' clerk's office, or a lawyer who has been practising in petty sessional courts is, in my opinion, more capable than most people of advising a judge on matters of this description, and I think that will generally be held to be the case.
  Mr. Beechman: I am sorry to detain the Committee, but I should like in two sentences, as a member of the Bar, to say how greatly I welcome the line taken by the Solicitor-General. I do not think the case could have been better put than it was by my right hon. and learned Friend the Member for West Derby (Sir D. Maxwell Fyfe). It is true that in most of these cases the appointment would, in my view, best go to mem-

  945
  bers of the Bar, but it is important that it should be open for members of the solicitors' profession to take these appointments, because there will be occasions when solicitors will be fully capable of carrying out these duties. It is further important that this experiment, if it be an experiment, should be made. Therefore, I feel that on behalf of the Liberals present this morning I can say with confidence that we welcome this progressive step.
  Amendment agreed to.
  Further Amendment made: In page I, line 8, insert:
  "(2) A clerk of assize appointed under this Section shall be an officer of the Supreme Court, and Sections one hundred and eighteen and one hundred and nineteen, Sub-section (I) of Section one hundred and twenty-seven and Sub-sections (1) and (2) of Section one hundred and twenty-eight of the Supreme Court of Judicature (Consolidation) Act, 1925 (which relate to the salaries, conditions of appointment, retirement and pensions of certain officers of the Supreme Court) shall have effect as if the office of clerk of assize were among the offices specified in Part I of the Third Schedule to that Act."—[Mr. Glenvil Hall.]
  Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."
  Lieut.-Colonel Lipton: At this stage I should like to draw attention again to two points which I raised on Second Reading in respect of which I think the Committee is entitled to a little elucidation by my hon. and learned Friend the Solicitor-General. It will be observed that the conditions of appointment relating to clerks of assize are governed by various Sections of the Supreme Court of Judicature (Consolidation) Act, 1925. The first point I wish to make, and it is governed by Section 118 of the Act to which I have referred, is the question of the salaries to be paid for the new appointments of full-time clerks of assize. These salaries will be fixed by the Lord Chancellor with the concurrence of the Treasury, because for the first time, with the passage of this Bill, clerks of assize will become permanent civil servants for the purposes of salaries and pensions. Perhaps the learned Solicitor-General was not in a position to deal fully with this point on the Second Reading, and, before the Committee is asked to accept the Clause as it stands, he may be able to give us a little more information
  946
  My other point is governed by Section 127, Subsection (I), of the Act of 1925. The effect of that particular Section is that the clerks of assize now to be appointed will retire at the age of 72, but may carry on to the age of 75, with the approval of the Treasury, if the Lord Chancellor considers it desirable. The legal industry, if I may so call it, for the purposes of this Bill now comprises both the Bar and the solicitors' profession. It is not an under-manned industry, and it does not suffer from any shortage of manpower. I feel that it is a retrograde step that at this time of the day we should be creating Civil Service appointments which can be held at least up to the age of 72, and possibly up to the age of 75. That is contrary to all the ideas for which we on this side of the House stand, and I hope that the Solicitor-General will be able—
  The Chairman: I think the hon. and gallant Member is trying to suggest an Amendment to the principal Act, which would not be in Order.
  Lieut.-Colonel Lipton: I am not suggesting an Amendment to the principal Act. I am trying to suggest that clerks of assize whom we are proposing to appoint under this Clause, shall not be subject to the terms and conditions relevant to other offices of the High Court which are provided in the Act referred to.
  The Chairman: That is precisely the point I was making. The hon. and gallant Member is suggesting changes in the conditions laid down in the Supreme Court of Judicature (Consolidation) Act, 1925, which he must not do.
  Lieut.-Colonel Lipton: I am trying to suggest that clerks of assize should not be placed under the provisions of the 1925 Act, which will apply to them when this Bill is passed.
  The Chairman: I am sorry but the hon. and gallant Member is now going contrary to the decision to which this Committee came, namely, that the Subsection containing these conditions should be inserted in the Bill.
  Mr. Boyd-Carpenter: Before the Committee part with this Clause, there is one question which I should like to ask. Does this Clause affect the Central Criminal Court, which for many purposes is a court of assize? It is not specifically

  947
  mentioned, and to prevent any possible doubts arising perhaps the Solicitor-General will give an answer to that.
  Mr. Bowles: A new Subsection which is not on the Order Paper has been moved. Would you be good enough, Major Milner, to tell us what the Committee have agreed to?
  The Chairman: The words included in brackets and underlined were left out in another place as a matter of Privilege, and this House necessarily has to insert them. It is quite a usual practice.
  The Solicitor-General: After your Ruling, Major Milner, two questions only are outstanding and require to be answered. The first relates to salaries. As has been pointed out, Section II8 of the 1925 Act provides that the salaries shall be of such an amount as the Lord Chancellor may, with the concurrence of the Treasury, from time-to-time determine. That being so, I am not yet in a position to say what they will be. They are the subject of consideration, and I am afraid I am not in a position to answer that question. I would remind the Committee that the whole object of the Bill is to pave the way and provide necessary legislative machinery for the scheme to be introduced, and that the details must be worked out as the scheme is brought into operation. The hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) asked whether this Bill would affect the Central Criminal Court? The answer to that question is that it will not.
  Question put, and agreed to
  Clause, as amended, ordered to stand part of the Bill.
  CLAUSE 2.—(Abolition of certain circuit offices.)
  Amendment made: In page 2, line 13, after "direct;" insert:
  "and the Lord Chancellor may with the concurrence of the Treasury provide for the remuneration and conditions of service of circuit bailiffs, and any such remuneration shall be paid out of moneys provided by Parliament."—[The Solicitor-General.]
  Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."
  12.15 p.m.
  Mr. Selwyn Lloyd: May I ask the Solicitor-General whether he is prepared to give any answer to the points which I made on the Second Reading with regard to the appointment of associates and clerks of indictments—at any rate, as far as the Northern Circuit is concerned? According to this Clause, these officers shall be officers of the Central Office of the Supreme Court. I have pointed out the importance of associates and clerks of indictments being permanent and local officials, at all events, so far as the Northern Circuit is concerned. Personally, I would much prefer the present system to continue, but if there is to be a change, and if these offices are to be abolished, I should like to know whether it will be possible for members of the Bar to carry out these functions in the future. I see that the hon. Member for South Croydon (Mr. Rees-Williams) is not present, otherwise we might have had his support. I think that it would be a very bad thing if the field from which such appointments are to be made in the future, were to be limited to clerks of the Central Office who have been serving in that office as boy and man. I think that it would be a very bad thing if there was to be trained in London a breed of civil servants to be sent out to the provinces to occupy these positions. I should like an assurance that there will be complete freedom of choice, and that a Member of the Bar can be appointed to such an office. I accept that then he will naturally have to become an officer of the Central Office. I want to be assured that previous service in the Central Office is not a condition precedent for appointment to one of these offices.
  The Solicitor-General: The question does arise on the appointment of associates. Hitherto, our discussion has been confined very largely to the question of the appointment of clerks of assizes, and possibly we have been inclined to forget the associates who are extremely important in the machinery of assize work. If the hon. Member will look at the Bill, he will see that it contains a saving provision in the first place for present associates. To start off with, as I conceive the operation of the Bill—and I would remind him again that we are merely discussing the provision of legislative machinery—when the scheme is enacted, junior officers at assizes will be given an opportunity to

  949
  come into the machinery if they wish. Their rights are safeguarded. If they do not come into the scheme, they will remain in their appointments and continue to discharge their functions. I can give the assurance that if associates in a circuit decide to come into the scheme, they will continue to be used for that circuit. They will continue the work they were doing before the scheme was brought into operation, so that so far as that particular circuit is concerned and that particular associate is concerned the position afterwards will be very much as it was before, the difference in this case being that he will be enjoying pension rights and other improvements in his conditions of service. That, of course, is the first stage, the stage which will ensue while there are still associates who are now sitting. In due course, as the years roll by, the question will arise of replacing them as they die, retire, or, for one reason or other, cease to function as associates. In most cases that is looking ahead some considerable distance. I do not know the ages of particular associates, but one wishes them long life and many years of useful service.
  When the time comes to replace them the scheme will be in operation. It is important to remember that a scheme of this sort does not function properly unless one proceeds carefully and experimentally, and makes provision for the actual circumstances as and when they arise. In the Second Reading Debate the hon. Gentleman called attention to the importance of continuity. I accept at once that that is of extreme importance. The scheme will not work if somebody who has no knowledge of a circuit, is placed in that circuit and expected to discharge functions which can only be discharged by someone with a fairly intimate knowledge, not only of the circumstances of the circuit but of the people who go there, the difficulties to be surmounted and the various factors which contribute, in the general sense, to the smooth running of the circuit and the efficient dispatch of work in the circuit.
  These types of appointments depend so much on the personality of the individual. If someone is sent who does not know the circuit, who may not be sympathetic to it, and who may not be liked because of his personal qualifications, or for any one of the hundred reasons for which people become liked or disliked, the scheme will not work properly. The
  950
  greatest pains will be taken by those who allocate associates to circuits to try to ensure that the person sent is a suitable person. He will be selected with the greatest care. As I said on Second Reading, there will be continuity in the sense that once someone has been allocated to a circuit, and is a success, he will be kept to that circuit, so that he will grow more and more into the atmosphere of the circuit, and begin to understand it, and to be understood and accepted by those members of both professions who practise on the circuit and litigants who resort to that circuit to obtain justice.
  Beyond that I do not think I can say precisely in advance what will be done. I can say that the question of continuity, the question of the suitability of the individual, the question of his fitting in with the genera) framework of the work of the circuit, will be constantly kept in mind as factors of paramount importance. I accept the view that unless that task is adequately achieved, the scheme will not work properly; it will be jerky and will not work as smoothly as the present scheme does. The scheme will deliberately aim at continuity, and the selection of a person who can gradually become known on the circuit, absorbed into it and accepted by those members of the Bar and everyone else concerned with the circuit, as the proper associate for that circuit. I hope that answer satisfies the hon. Member. I do not think I can be called upon to give a more detailed answer, simply because we are only discussing the legislative framework, and making the necessary alterations in the Act of 1925 to enable the scheme to be introduced. It will be formulated in its details by actual practical working of those details.
  Mr. Selwyn Lloyd: May I thank the Solicitor-General for as much as he has said, and ask him about one last point? I was asking, in regard to a vacancy in the pool of associates, for some assurance as to the method of filling that vacancy, in other words that it should be open to members of the Bar, solicitors or anyone else, to apply for that vacancy in the associates pool, and that it would be unnecessary for him to have had five or ten years' previous service in the Central Office prior to his appointment to the pool of associates.
  The Solicitor-General: I think I can say that unless unforeseen circumstances intervene, previous service in the Central Office would not be regarded as essential for an associate, whether he were a barrister or solicitor. As the hon. Member knows, there are no statutory qualifications for the purpose. Whatever he was, as soon as he came into the new scheme, he could be appointed. In all cases it would depend upon the individual, and the actual circumstances at the time.
  Mr. Selwyn Lloyd: I am much obliged to the Solicitor-General for that assurance.
  Question put, and agreed to.
  Clause, as amended, ordered to stand part of the Bill.
  Clause 3 ordered to stand part of the Bill.
  Bill reported, with Amendments; as amended, considered; read the Third time, and passed, with Amendments.

  PUBLIC NOTARIES (WAR SERVICE OF ARTICLED CLERKS) BILL [Lords]
  Considered in Committee.
  [Major MILNER in the Chair]
  Clauses I and 2 ordered to stand part of the Bill.
  CLAUSE 3.—(Interpretation.)
  Motion made, and Question proposed, "That the Clause stand part of the Bill."
  12.25 p.m.
  Mr. Boyd-Carpenter: The Solicitor-General will recall that on the Second Reading of the Bill last week, I raised two points with him. The first related to the definition of "war service" in the Clause. I fully appreciate the difficulty of precise and accurate definition. I appreciate that Paragraph (c) gives discretion in this matter to the Master of the Faculties, but I think it would be of assistance to the Committee, and possibly to the Master of the Faculties if some expression of opinion as to what is "war service" were given on behalf of the Committee, and indeed of the Government. One point which might create some difficulty for the Master of the Faculties, and which might raise questions of controversy, is whether service or work under the direction of a Conscientious Objectors Tribunal does or does
  952
  not count as war service within the definition. That is obviously a matter which raises difficulties, and possibly feelings. I do not know whether the Solicitor-General is prepared to say something on that question, and on the question of what other obviously important forms of war service should be considered.
  The other matter to which I invited the Solicitor-General's attention was the definition of the "emergency period." I do not want to repeat the remarks which I made on Second Reading. I fully appreciate the difficulty of the interaction of this Bill with other Measures, in which the same provision has been made. It is no doubt impracticable to put an amendment into this Bill, but I would like some indication that the Government are aware of the fact that the exclusion of full-time embodied service prior to 1st September, 1939, from this computation, causes hardship, and I would like some assurance that the possibility of dealing with this hardship is being considered by the Government.
  12.30 p.m.
  Mr. Turner-Samuels: When we were discussing this Bill last week, I raised a matter on which I should like to have the Solicitor-General's view. The term "war service" is, of course, intended to include what, under Statute, is described as "national service," that is to say, service other than in the Forces. This Bill seeks to give to the applicant the benefit of that war service in the sense that he can ask for it to be taken into account in deciding the term that he has to serve as his apprenticeship. In other words, that term can be reduced to two years. The difficulty is that if the applicant, having got his term of apprenticeship reduced to two years, receives a call-up notice to serve in the Army for two years, the whole benefit which he should derive from the Bill would be absolutely destroyed, and, what is worse, is that if, in the meantime, he has received his articles and paid a premium, he loses the benefit of those articles because the term has been reduced to two years. He also loses the premium which he paid on the basis of two years. It occurred to me that something ought to be done about the matter and that, probably, the learned Solicitor-General can tell us that it is a matter which can be adjusted administratively, as I think is the case.

  953
  I do not think there is any need for an Amendment in connection with the matter and that is why I did not put one down. But I should like an assurance that this Bill will, in fact, work so as to achieve the purpose which is adumbrated in it, and which is embraced in the phrase "war service," and that where that benefit is applied, and a particular applicant's period of service or apprenticeship is reduced to two years, it will not be nullified by his getting a call up notice which would defeat the whole thing. I would ask the learned Solicitor-General to say whether he has considered this matter, and, if he has not, whether it will be taken into account and, if necessary, adjusted administratively.
  The Solicitor-General (Major Sir Frank Soskice): I will answer the three questions put to me in the order in which they were asked. The definition of "war service," which was the first point touched upon by the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) is, of course, framed in such a way as to include those ordinary categories which one obviously regards as war service. If I am right in my recollection, I believe that in the earlier Debate the hon. Gentleman mentioned the Merchant Marine. I should have thought that men in that Service would undoubtedly be included. His criticism was really that it should not be left in the discretion of the Master of the Faculties. I feel that, in the case of service like that, there can be no real doubt as to how he would exercise his discretion and no real danger of the Clause, as it is drawn at present, operating unfairly in any particular case.
  I would remind the Committee that comparatively few people are affected by this Measure. There are some 550 practising notaries and there were approximately 100 serving articles in peacetime. I am not aware that there is any likelihood of any one of them being unfairly dealt with because of the definition as it is at present worked. It has been carefully thought about and, as the hon. Gentleman knows, has been taken from an earlier Act where it has worked well. I would rather not give an answer offhand to the question he asked about conscientious objectors without considering it further, and that, I am sure, he will allow me to do.
  With regard to the question of embodied service in the Territorial Army before the
  954
  actual outbreak of war, there, again, one is dealing with a very few people and the time involved represents an extension of a very few weeks. It would be difficult to amend this Measure without having corresponding Amendments in a number of other Acts which deal with similar problems and, therefore, I would ask the hon. Gentleman to accept the view that this Bill should stand as it is. If it were extended in the way he suggests, it would be different in a very marked degree from a number of other Acts, and it would be difficult to justify the differentiation in the case of this particular one. It would be necessary to make Amendments in a whole heap of others. Therefore, I would ask him not to press that particular point either.
  With regard to the point made by my hon. and learned Friend the Member for Gloucester (Mr. Turner-Samuels), I feel that he has overlooked the fact that it must be an essential condition that at least two years shall be served. I feel that he slightly misapprehended the position. There is no flaw in the Act. I considered very carefully what he said on the Second Reading of this Bill. It is designed, and expressly designed, that the public notary even if he is able to pray in aid the benefit conferred upon him by Clause I of the Bill, must, nevertheless, serve not less than two years as a clerk in apprenticeship to a public notary. That office involves very considerable experience and knowledge. In the normal course, he has to serve an apprenticeship of five or seven years according to where he practices. That period has been drastically cut down to two years, which is thought to be the minimum period in which he can acquire the miscellaneous knowledge necessary to fit him to do the work of a public notary. There are documents which he has to authenticate and prepare dealing, particularly, with our overseas trade, and a knowledge of languages and of other systems of law is highly desirable. I suggest that it is not in the public interest that a young man should be called upon to undertake that sort of work without having undergone at least two years' apprenticeship. Therefore, I feel that the Bill as it stands is satisfactory.
  Mr. Turner-Samuels: The learned Solicitor-General is, I am afraid, under a misapprehension as to the point I made. We all agree that two years is the very least that ought to be spent in service with

  955
  a notary, and indeed, the very purpose of this Bill is to fit young men who have undergone war service for this office. But what I am saying is that it is not a question of reducing the period to two years, but that the benefit is lost if, in fact, that exemption having been obtained, a notice of call-up is served. In that sense, the period has to be served in the Army, and the young man concerned loses his articles and premium, and has to start all over again and serve another two years. That was the point.
  The Solicitor-General: I think it is right that the Bill should provide that whatever service a young man does, he must, nevertheless, serve two years. That is what I was saying.
  Question put, and agreed to
  Clause ordered to stand part of the Bill.
  CLAUSE 4.—(Short title, citation and extent.)
  Motion made, and Question proposed, "That the Clause stand part of the Bill."
  Mr. Mathers: May we have some information as to why the Bill does not apply to Scotland and Northern Ireland? I am sure there is a simple explanation for this. Perhaps the other Acts do not refer to Scotland either. However, I should be glad to have it on record why this particular Bill does not apply to Scotland.
  The Solicitor-General: I think that my hon. Friend has put his finger on the right spot. I believe I am right in saying that we are dealing with Acts which do not apply to Scotland. The Scottish legislative system is different from the English in this respect, and this Bill is designed to effect alterations to the enactments in Clause 4, namely, the various Public Notaries Acts, extending throughout the century, whose application is confined to England and does not extend to Scotland or Northern Ireland. As they are being amended, the Act, in consequence, applies only to England.
  Question put, and agreed to.
  Clause ordered to stand part of the Bill.
  Bill reported, without Amendment; read the Third time, and passed, without Amendment.

  DOUBLE TAXATION RELIEF
  Motion made, and Question proposed,
  "That an humble Address be presented to His Majesty, praying that the Double Taxation Relief (Taxes on Income) (Canada) Order. 1946, be made in the form of the draft laid before this House on 6th June."—[Mr. Glenvil Hall.]
  12.41 p.m.
  Mr. Osbert Peake: As I understand the position this agreement is very closely in line with that which the House has already approved in respect of double taxation on income between His Majesty's Government and the Government of the United States. We shall not, therefore, require from the Financial Secretary a detailed explanation of its provisions. We welcome it, as we did the agreement with the United States, on grounds of convenience and equity. This question of double taxation, which was only an irritant before the war, has become a very grievous one with the high rates of taxation now operative owing to war conditions, and it is quite wrong that persons should be obliged to pay taxes in two countries on the same sources of income at the prevailing high rates.
  I would, however, ask the Financial Secretary one question on the agreement relating to relief from taxes on income which is the subject of the Motion now before the House. He will recall that when a similar agreement was made with the United States early in the year it had subsequently to be amended by protocol at the request of the United States authorities, and that the protocol deleted from the agreement what is contained in Article 9 of paragraph (3) of the present Agreement. That paragraph says that the provisions of Article 9 shall not apply to the profits or remuneration of public entertainers such as stage, motion picture, or radio artists, musicians, and athletes, and Article 9 is designed to give relief quickly from double taxation in cases where certain classes of persons are on short term visits from one country to another. This provision in paragraph (3) has been deleted at the request of the United States authorities from the agreement with the United States. I see, however, that it stands so far as the agreement with Canada is concerned. I imagine that this is probably the only particular in which this agreement will differ substantially from that made with the United States. I should like the

  957
  Financial Secretary first of all to tell us why this agreement is not similar in that respect to the one made with the United States, and secondly, whether this is, in fact, the only particular in which it differs from the other.
  12.43 p.m.
  The Financial Secretary to the Treasury (Mr. Glenvil Hall): It is quite true that a provision similar to paragraph (3) of Article 9 which appears in this draft Order also appeared in the original convention made with the United States but was afterwards deleted by protocol. The short answer is that what Hollywod forced or— perhaps I should not use that word—persuaded the American Government to look again at what the Canadians have accepted. This paragraph (3) is desired by the Canadian Government, and we have fallen in with it. The only other point on which this draft Order differs from the convention made earlier this year with the United States is that by agreement interest, patent royalties, and film rentals are treated differently. I can assure the House that the Articles in this Draft are what the Canadian Government desired, and that we were happy to fall in with their wishes. That being so, I hope the House will accept the draft Order as it stands.
  Question put, and agreed to.
  Resolved:
  "That an humble Address be presented to His Majesty, praying that the Double Taxation Relief (Taxes on Income) (Canada) Order, 1946, be made in the form of the draft laid before this House on 6th June."
  Resolved:
  "That an humble Address be presented to His Majesty, praying that the Double Taxation Relief (Estate Duty) (Canada) Order, 1946, be made in the form of the draft laid before this House on 6th June."—[Mr. Glenvil Hall.]
  12.46 p.m.
  Mr. Glenvil Hall: I beg to move,
  "That an humble Address be presented to His Majesty, praying that the Double Taxation Relief (Taxes on Income) (Southern Rhodesia) Order, 1946, be made in the form of the draft laid before this House on 8th October."
  Mr. Peake: As I have already said, I think we all welcome the extension of this double taxation agreement to our Dominions. So far as overseas countries are concerned, agreements have been made hitherto only with the United States and now with Canada, and this is the first of
  958
  the agreements with the other Dominions. Doubtless, further agreements with South Africa, Australia and New Zealand will follow in due due. I note that the right hon. Gentleman the Chancellor of the Exchequer is putting before the House today a Motion relating only to Income Tax so far as Southern Rhodesia is concerned. On both the former occasions, when the agreements were made with the United States and with Canada, we have had Motions relating not only to Income Tax but also to Estate Duty. Perhaps the hon. Gentleman the Financial Secretary could tell us whether there is to be an agreement with Southern Rhodesia on the question of Estate Duty also, or whether in the case of that country the relief is to be confined to taxes on income as defined in the agreement?
  Mr. Glenvil Hall: As the right hon. Gentleman says, this draft Order covers Income Tax, but as he will find if he looks at the agreement that phrase includes in actual fact national defence contributions. Excess Profits Tax is not included because in Southern Rhodesia the Excess Profits Tax was repealed as from 31st March, 1945. So far as I know there is no Estate Duty payable in Southern Rhodesia, and that is why it has not been included.
  Question put, and agreed to.
  Resolved:
  "That an humble Address be presented to His Majesty, praying that the Double Taxation Relief (Taxes on Income) (Southern Rhodesia) Order, 1946, be made in the form of the draft laid before this House on 8th October."
  Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Simmons.]

  HOTEL INDUSTRY (REHABILITATION PRIORITIES)
  12.50 p.m.
  Sir Ian Fraser: I understand that there is a substantial number of hon. Members representing constituencies where the tourist industry and amenities of that kind are a very important element who want to speak in this Debate. I will therefore open it very briefly. Perhaps I may start by explaining why I have taken this opportunity to raise this subject. It is because I have the honour to represent a constituency which stands very high in the

  959
  list of those which are concerned with the visitor. The Lonsdale Division of Lancashire, in the North-West corner of the county adjoining Cumberland and Westmorland, contains a very large area of our English Lake District, which is popular not only with our own people, but with visitors from overseas, and such famous lakes as that of Coniston, which is wholly included in my constituency, and Windermere, of which three parts are in my constituency, as well as many charming towns, such as Hawkshead, Lakeside and Grange-over-Sands, and vast beautiful areas, which contain great attractions for the visitor and many establishments to provide them with residence during the holiday period. On the sea coast also is Silverdale, and adjoining us in the constituency of Westmorland is the little town of Arnside, and just below us, across the bay, the famous and well known resort of Morecambe. I do not speak for any association of hotels and restaurants or of boarding houses, though I have been in touch with them to get some information about the position in the country generally in order to check up to see that my own personal observations in my constituency are not exceptional. Nevertheless, I am speaking primarily from my own knowledge of what I have ascertained in my constituency of their needs, and it is those that I want to put primarily before the Government.
  Before I do that I may call the attention of the House to the size of our hotel, restaurant and boarding house industry? There are two associations, that which has for its membership the larger establishments, of which there are 1,500, with an estimated prewar capital involved in this part of the industry of over £100 million, and the Association of Residential Hotels and Boarding Houses, that is, mainly the smaller establishments, with some 4,000 members and an estimated capital of some £40 million or more. These are prewar figures. They are not inclusive figures, for there are in addition a very large number of establishments that are not members of these associations, and there are, the House will realise, perhaps 40,000 or 50,000 licensed houses which also render valuable services in connection with the provision of holidays and entertainments.
  960
  It is a matter of policy for the Government—and I hope the House will take a hand in helping to shape this policy—to see what kind of priorities ought to be given to this industry. I want to submit one or two arguments in favour of giving it a very high priority at this time in the matter of rehabilitation and generally in overcoming the difficulties of the past few years of war. First of all, some hundreds of thousands of beds are provided in these thousands of establishments which I have mentioned. I submit that there is no conflict between the claim of the hotel and boarding house industry for priorities to make these beds effective and the claim of housing in general. Indeed, the provision of these beds is part of the general housing problem. It is within the knowledge of most of us that most beds in most hotels and boarding houses are full for most part of the year. Therefore, they are not a waste provision. They are a definite contribution towards the housing problem. In so far as increased numbers of beds are available in boarding houses and hotels, they make a direct contribution towards easing the strain in the ordinary housing of our people. It may be said that the possibility of securing a fortnight's relief from the difficulties at home and the overcrowding in many homes may well, apart from its other value, contribute something towards making the present housing difficulties more tolerable to hundreds and thousands of house wives who have such a difficult time nowadays.
  We all agree that an exceptional superpriority should rightly be given by the Minister of Health to the use of building and other labour to put roofs on houses which are up to the eaves. That is a special priority within the priority class but, outside that, I claim that the provision of beds in hotels and boarding houses throughout the country should rank as high as ordinary houses. I want to ask the Minister whether that is in the mind of the Government, and, if not, whether he will urge that view upon the Minister of Health?
  I now wish to deal with some few small figures which I have obtained from the Trade and Navigation Returns. In the period of nine months this year very substantial exports have been made of such goods as towels, sheets, mattresses, furniture and carpets. I will not trouble

  961
  the House with details except just to tell them that I see from the return that 17,000 cwts. of towels have been exported from this country in that period, and also two and one-third million yards of carpet. I cannot help feeling that the skin on the back of the President of the Board of Trade tingles with pleasure when he thinks of nice rough bath towels in cwts. How many of us would be glad of one, let alone one cwt? That brings us to consideration of the priority that should be afforded to three classes of people: the home user, who is short of all these necessary conveniences in her house; the hotel and restaurant and boarding house industry, on whose behalf I am now speaking; and, of course, the export trade. I returned earlier this year from a business trip to South Africa, and two aspects of that are relevant to this matter. It is essential that exports which we have made overseas should continue, and increase as our production increases. If one puts oneself in the position of the wholesaler or retailer in an overseas country waiting for years for the products from Britain which one valued so greatly, and which one's customers are demanding, one rejoices when at last the doors are opened and small quantities of the wellknown and well-liked goods come out to one's country. It would be a disappointment indeed if after the first year one found that the amount of goods one received for the second year had been cut down. So I do not want it to be thought that I am urging that the amount of goods sent overseas should be cut down.
  On the other hand, the process of getting back to normal trade is one which accelerates, and I cannot doubt that the production of towels, carpets, furniture, pots, pans, plates and all the rest, must be increasing at a rapid rate. If that is so, I hope there is room for continuous reasonable expansion in the export trade and, at the same time, for the allocation of substantial quantities of these goods to relieve the necessities of those at home. Those at home include the private, ordinary households and the hotel industry, and obviously, the one must not come before the other. I am suggesting that both must be served, but I want to put this point to the House. We are not, if we supply towels or sheets or crockery to the hotel and boarding houses industry, depriving thereby the people who live in ordinary houses from the
  962
  enjoyment of those towels and sheets and plates. On the contrary, they are the same people, the people who, dwelling in houses, go for a holiday by the seaside or in the country for a week or a fortnight, and they will enjoy part of the use of these amenities if they are provided. Therefore, I conclude this part of my argument about priorities by saying that, on every ground of equity, the hotel and boarding house industry ought to have a very high priority in the provision of these necessary goods which are required for rehabilitation.
  Before I leave the question of South Africa finally, there is one other argument. While out there I observed an extremely strong tendency on the part of business men and others to want to come over to this country, and I can assure the House that only the limited number of places in ships, and the present limited aeroplane service, have kept the numbers down to a relatively low level. There has piled up a large number of people wanting to come. When, therefore, I was told that there were 10,000 people asking to come to this country between April and June, and there were only 340 places available in ships, I realise that the pile-up is increasing, and I do not doubt that next year, from this one Dominion alone, there will be some tens of thousands of people wanting to come to this country, some to see relatives from whom they have been separated for a long time, some on business, some as buyers. These are the precursors, from South Africa, from all the Dominions, from the United States, of a vast return to and, I hope, an increase on, our enormous prewar visiting trade. It is extremely important, because not only does it bring many people to assimilate our ideas and our way of living, of which we are proud, but it brings people to buy our goods, and it brings people who, while they are with us, spend their money in our country, much of it good hard currency which we need. It may even be that some sacrifice in the amount of goods that we send overseas, or in the amount that we might send, would be more than recompensed by the invisible export obtained by bringing in these foreign currencies which the tourists bring with them. Therefore, the Government might well consider balancing these two items in their overseas account.

  963
  One word about requisitions. From the reply I received to a Question I asked on Tuesday, there are still 558 hotels and boarding houses under requisition. I am not saying that the progress made in de-requisitioning has not been considerable; no doubt it has, but there is still this large number. I ask that they be derequisitioned as early as possible. I ask that once the decision to derequisition is made, the Department concerned will carry out the executive work of derequisitioning with expedition. I have had cases brought to my notice where great delays have taken place, sometimes on the part of Service Departments, sometimes on the part of the Office of Works. So much so, that a month or two has been lost, thus destroying the holiday season for those people and destroying the opportunity of a holiday for those who might have gone to these places. It is not too early to begin to think of next season starting before Easter, and we would like an assurance that a special circular or instruction will be issued to make sure that these derequisitionings take place.
  The same sense of urgency is required in dealing with licences for repairs and redecorations and the adding of certain amenities which are necessary for replacement of worn-out fittings and facilities. I have heard from many quarters that there are great delays in the handling of these matters by the Ministry of Works through its regional representatives. Perhaps they are overworked, perhaps their staff should be strengthened. I do not know the cause, and I do not blame any particular official, but the Ministry is responsible for the delays and it is for it to show how they can be overcome. I do not want to "job backwards," I only want to urge the Minister to report to his colleague the urgent necessity for seeing that, where licences are reasonable and should he granted, they are granted quickly. It makes all the difference to get the job done quickly, and, not only that, the licences should be sufficient to enable the job to be done properly. If it needs £250 to put a boarding house in order, and the Ministry is mean and grants only £110 and says more will be granted later, it costs the person much more to have the job done in two parts than in one. It also causes great inconvenience and, in the end, very little is gained.
  964
  The House generally seemed to me the other day to approve of the action of our own Kitchen Committee in putting our own restaurant staff into uniform. Why should we deny the amenities and the satisfaction of allowing uniforms to be made available in hotels and boarding houses where they are customary and are required? They contribute very materially towards the smartness a the staff and towards the general satisfaction of the visitors. I want the House to remember that recent developments in our industrial and social views have led to no fewer than 13,000,000 workers having the right to paid holidays with their families, so that the holiday is not to be the prerogative of the well-to-do or of the middle classes or, indeed, of any section of the community. Since 13,000,000 people are entitled to a paid holiday, let us see that by next April or May we have taken every possible step to make sure than in the boarding houses, hostels and restaurants throughout the country we have made a very real effort towards making those holidays as bright and cheerful and as worth while as possible.
  1.9 p.m.
  Mr. I. J. Pitman: I am glad that the hon. Member for Lonsdale (Sir I. Fraser) has brought up this question, because, in my opinion, it is a most important one. I would like to talk on three different angles of this problem: first, organisation; secondly, policy; and thirdly, action. For the last two days we have been discussing organisation for defence, and rightly so, because I am convinced you get nowhere in life unless the organisation is correct. I fear that one of our troubles over hotels at the moment is the organisational problem. In organisation, there are two things that are absolutely essential, particularly in a case where there is a coordinative function. First, you must have responsibility pinned clearly and solely on one pair of shoulders, and, secondly, you must have the proper inter-Departmental coordinative machinery to ease contact, to form policy, and thirdly, to carry out that policy in action.
  In regard to responsibility, I would like to ask the Secretary for Overseas Trade who precisely it is that is really responsible for the hotel and tourist industry and, if it is he himself, where, in the two of his dualities of function, the ultimate responsibility lies? Is it in the Foreign

  965
  Office, or is it in the Board of Trade? As I say, this is very similar to the problem of defence. If the coordinative organisation of defence had been proposed with a Secretary attached to one of the three big Defence Ministries with a little note in brackets underneath "also the Air Ministry and War Office," you would not only not pin responsibility on one pair of shoulders, but you would also not get the effective organisation which is necessary, and this is just the organisation which I believe we have for helping the hotel industry.
  The problem of organisation is also important in regard to coordinative machinery, and I would like to ask the Minister whether the Tourist Accommodation Committee is still in being, as a coordinating Committee, or whether it is still disbanded? In this case of hotels there is a great coordinative problem. No fewer than eight Ministries are involved in serving visitors. All these Ministries are involved if it is desired to attract visitors to our hotels, to develop the tourist industry and in so doing to help our export drive forward. The Board of Trade must attract them by providing hotels with the furniture, blankets, and other things about which my hon. Friend the Member for Lonsdale has been talking. The Ministry of Food must be persuaded to attract visitors by attractive food. The Ministry of Labour must attract them with good service from hotel staffs. I am very glad to see that the Ministry of Labour is interesting itself in the vexed question of coffee in hotels. The Catering Wages Commission, over which the learned Attorney-General presided, I understand took up this question, and there seems, therefore, to be a coordinative problem for the Ministry of Labour over coffee as well as over staff. Then the Home Office comes into the picture, on the question of attracting visitors—or not deterring them—by their alien registration requirements. The Ministry of Works comes in on the question of derequisitioning hotels, and the War Damage Commission comes into the matter in only too many cases, and particularly in the city of Bath. The Ministry of Health comes in on the question of licences and, finally, the Treasury comes in on the question of hard currencies, and the degree of preference to be given to attracting visitors from one overseas country rather than from another.
  966
  I turn now from the matter of organisation to the policy which that organisation should work out for itself, and eventually turn into action. I am a publisher, and publishers says that "trade follows the book." I agree, but I would say that if there is one book which trade follows even more than ours it is that book which lies open on the reception desks of the hotels of Britain. It ought to be the first objective of the person with whom lies the responsibility for the tourist industry to get as many people to sign their names in that book as possible, people from influential circles in the important parts of the world, people who will put trade in the way of our country. In our policy, I would say that there are four priorities. It seems to me that accommodation in the big business centres ought to come first—London, Manchester, Liverpool, Birmingham, and so on: secondly, I think that within that priority the luxury hotels in these areas should come first and the medium-sized ones second, because we must face the fact that influential vistors, those whom we most wish to attract want to stay in just that type of hotel. Surely we must recognise this when we realise that when His Majesty's Ministers go overseas they stay in just that sort of hotel themselves. Therefore, if we wish to accommodate people in this country who are likely to foster our export drive it is that sort of hotel which, clearly, ought to come first.
  Then there is next in importance the recreational areas such as the one mentioned by my hon. Friend the Member for Lonsdale. Edinburgh, Bath and Stratford-on-Avon are among the attractive places where the business man will hope to relax and so to combine pleasure with his business and to enjoy himself when he comes to this country to place, as we hope, his orders. It is most important that he should have two reasons to wish to return, and that when the present sellers' market is over, and there is once again a buyers' market, he should renew his custom, even though it may have been originated by the fact that we have output which for the moment we can let him have but which he cannot get elsewhere. We must ensure that such a businessman will wish to come to Britain not only for business, but for pleasure, and therefore, this question of attracting influential men is most important. The International Chamber of

  967
  Commerce, which is the body of businessmen recognised by the United Nations organisation through its Social Security Council, has been considering whether and when it can hold a meeting in London. It seems probable that the delegates could not for sometime be accommodated, in London hotels, but they are just the very people whom we would wish to come here and so to stimulate and improve our export drive.
  Thirdly, you get other organisations like the Workers' Education Association, youth movements and Olympic Games, which are only indirectly connected with the export drive and, finally, there is the home market which can most conveniently be used as a "fill up" on a percentage basis. The home need not conflict with the tourist accommodation. I believe that there is a smooth working system of percentage allocations whereby hotels give to foreigners accommodation which is authorised under any such priority scheme, and that the accommodation not wanted for tourists is available for the home visitor.
  In all this there is an important problem of priorities and selection and, above all, timing. Such co-ordinative machinery ought to realise the importance of the objective and ought to work out its priorities properly.
  Finally, turning to the action, I think there is no wonder that progress has been slow, when we think that there are eight Ministries and no clear coordinating machinery, and, as I believe, no clear pinning of responsibility on the shoulders of one man. In fact, I should say that, not only has there been no progress, but that there has been actual regress. Certainly, that is the case in the lovely city which I have the honour to represent, and, it is a very good instance of the sort of thing which is happening. The heavy hand of the Ministry of Works has descended upon one of the most important hotels in Bath, which, as the result of long negotiation, has just been released by the Admiralty, and now the Ministry of Works has taken it on for a new user for a period of five or six years. How can Bath with its spa industry, the recreational industry and the Tourist Industry, recover itself after this war when it is a case of regress, not progress? Even elsewhere the situation
  968
  is worse, not better. Six years of erosion have had a great effect, and the speed of that erosion becomes greater the more worn out everything is. I should say that, at the present moment, the tourist industry is actually going back and not going forward, and so I plead very strongly to the Government to realise the importance of this issue, to solve the organisation problem and to put this important industry upon its feet again.
  1.22 p.m.
  Mr. Edward Evans: I am very glad to be associated in this Debate with my hon. Friend the Member for Lonsdale (Sir I. Fraser), for he and I have worked closely together in other fields for many years. It is appropriate that the hon. Member represents the wettest constituency in the country, while I claim to represent the driest.
  Sir Ian Fraser: I appreciate the hon. Member's great politeness in his opening remarks, but he will also appreciate that, at certain times of the year, the English Lake District is extremely dry and bright, but without the East coast wind.
  Mr. Evans: I was proposing to visit that district for a holiday next year, and I hope it will stand up to the reputation which the hon. Gentleman has given it. I represent the Lowestoft Division of Suffolk, and, as the House is aware, the main industries there are the fishing and catering industries. During the war, these industries were practically eliminated. Lowestoft, and, indeed, all along the East coast, suffered from restrictions because visitors were banned. Holiday visitors were, of course, entirely prohibited, and, naturally, the main industry and prosperity of the town and of the whole coast suffered in consequence. Therefore, it is of the greatest importance that this industry should be rehabilitated as soon as possible. It is perfectly true that there was some form of compensation in that area, as the landladies and hotels which were requisitioned had the duty of billeting Services personnel, but I do not think any one would claim that the profits accruing from taking in soldiers, sailors, and airmen can be measured in the same terms as those from the more profitable holiday industry. Indeed, there have been complaints that the profits in some areas have been exorbitant during the last year, and I hope that will not be continued.

  969
  It is essential that every encouragement should be given to these areas to rehabilitate their essential industry, and that every inducement should be given to the workers of the country to go to these places. Our greatest asset is our glorious air. It can be very biting and cold on the East coast, and that can be a liability. It is there, I think, that the Government can help us by allowing us to have those commodities, such as household furniture that make for the comfort of visitors and help to make a holiday, particularly in inclement weather —which we do not get very often on the East coast—more enjoyable. I will gladly concede that we, on the Coastal Resorts Committee, agree that, since the Lord Privy Seal interested himself in our problems, there has been a great deal of improvement. Derequisitioning has gone on apace, and there has been a continuous and steady flow of commodities into the hotels and boarding houses.
  I want to speak more particularly for the smaller establishments. The Service Departments are inclined to be extremely niggardly in making restitution for damage. These places must be made good and habitable, so as to provide a high standard of amenities, and it is a rather deplorable reflection that, during the war, a great amount of damage—a great deal of it wilful damage, I am sorry to say—has been done to these houses and hotels. It is all very well saying that the Service Departments have derequisitioned these houses and hotels, but the premises ought to be put into habitable condition, and the hotels cannot accept visitors unless something more is done. In cases which I have had to bring to the notice of the Ministries concerned, the very minimum was being offered in the way of restitution, and our people are asking that, not only shall these premises be put into reasonable condition, but that they shall be restored to the condition in which they were let to the Service Departments. We want complete derequisitioning and restitution of this element in the industry, which will make it possible for the industry to rehabilitate itself. We want to make the workers comfortable when they come to the seaside, and we, on our part of the coast, can attract all types of visitors. All these places need the greatest encouragement to get back on a proper footing.
  Seaside landladies have often been the subject of criticism and the butt of music-hall comedians. I do not know why it
  970
  should be so, but the seaside landlady ranks with the mother-in-law and the humble sausage as a subject of jokes. I assure the House that, in this area which I represent, these landladies performed a very useful service. In my own district, they took in naval personnel, made them comfortable, acted in a large measure in a very motherly capacity, took care of their mending and looked after them when ill. Now they ask for their reward, and the reward which the Government can give by way of recognition of those services, is help in enabling them to get back into business as soon as possible.
  1.28 p.m.
  Mr. Beechman: I, too, am very pleased that my hon. Friend the Member for Lonsdale (Sir Ian Fraser) has raised this matter, because it is very important that the hotels and guest houses in what our Dominion visitors call the old country should be properly equipped and ready for visitors. We may be an old country, but there is no reason why we should be dowdy. While in Europe this year, I was delighted to find what a friendly feeling there was towards this country and how interested in us the people there were and how anxious they were to see this country, which has meant so much to them in the war. We do not want to tell them that they cannot come here because we have been unable to reopen our hotels and make people as comfortable as they ought to be, and that, in fact, we have lost something of our blithe spirit.
  There is a real danger that in our laudable efforts to establish as sound a foundation as we can for postwar reconstruction in this country, we may get to think that drabness is an inevitable aspect of life. I would like to call attention to a few specific instances of difficulty which have come within my experience. The hon. Member for Lonsdale has rightly said that there has been considerable progress in derequisitioning. I am glad to see that the Minister of Works is here, because I know that he has taken a great deal of interest in this matter. At the same time, we have had our difficulties. I remember a recent case where, for month after month, protests had to be made before we could get a lovely house, in most enchanting grounds near Penzance, derequisitioned. I would like to call attention to an astonishing case. There is in St. Ives an excellent little hotel known

  971
  as the Trecarrell Hotel, and hon. Members may be surprised to hear that in this hotel there are still war evacuees. I have had a pathetic missive from the evacuees asking me whether they cannot get home. Representations have been made by our most excellent and active local authority. I know that the continuing requisitioning of this hotel for this purpose is causing real anxiety to the gentleman who owns the hotel, and certainly it is desirable for the town of St. Ives and for those who wish to come there that such a place should be free as soon as possible.
  I would like to say a few words about compensation. On the whole those who have to assess compensation have taken great care over their work, and I do not think there has been a very great deal of trouble. But in the Isles of Scilly I did strike a case where compensation was being fixed on the basis that a hotel, which is particularly lovely and most beautifully situated beside the bay, should be put right on a shoddy basis; in fact, that it should not be put into the same condition in which it was before it was most lamentably mishandled, I am sorry to say, by troops who were there. The gentleman who makes his livelihood from this hotel happens to be a most patriotic citizen of the Islands, and has given really distinguished service in our Forces, and I could only congratulate him upon the modesty and patriotism with which he has put forward his claim. I am not making these observations because he has asked me to do so, but because I was so struck by the rather niggardly way in which this particular matter was being handled.
  I have also, again and again, found that there were really unnecessary difficulties in the way of hotel, boarding house and lodging house keepers obtaining linen or carpets to replace those which had been destroyed during the war for reasons which were not their own fault. I know of a case in the Isles of Scilly where a lady who keeps a small hotel looked after a continuous stream of Service personnel who went to those islands for very special and good reasons, and, although I tried to help her, she was unable to get dockets to buy linen to replace the linen which had been destroyed, in spite of the fact that we all knew that such linen was available in Plymouth. The hon. Member for Lonsdale said that he hoped the respec-
  972
  tive Ministers would get these matters put right for the coming season beginning next Easter. That is not quite good enough for me, because we have a season in the winter. I look forward to seeing my camelias blooming in my garden in December, as they will be in many other gardens in West Cornwall. There will be narcissi and daffodils in January, and mimosa in the Scillys at Christmas. We should ensure that people from abroad and in this country who come to have a well deserved holiday will find hotels and guest houses ready to receive them.
  1.36 p.m.
  Mr. Janner: We are all indebted to the hon. Member for Lonsdale (Sir I. Fraser) for having raised this question today, and I think it is appropriate that some of us who represent constituencies which are not entirely on the seacoast—although everything in England is, more or less, near the sea—should give our views on this matter in order to help if possible. I hope the Ministries concerned will realise what the country really needs in this regard. I think it ought to be made clear first, that on this side of the House we realise that the first priority must be the housing of the people. There can be no question about that. I assume that on the other sides of the House a similar feeling prevails. Most of us will agree that the Ministries concerned have done a very good piece of work in providing the housing accommodation which they have provided considering the difficulties in their way; but, taking the case of a town like Leicester, for example, I think there is much to be said for giving very careful consideration to the provision of further hotel and boarding house accommodation as quickly as possible, for many reasons.
  Here is an industrial city to which is attracted a large number of buyers from abroad as well as from England, Wales and Scotland, who provide a large market for our products. Leicester should be encouraged in every way to sell its products throughout the world, because they are excellent products. To do that, proper facilities must be given to people to come to the city and to the county and make their purchases, and they should not be put to undue difficulty in obtaining accommodation. I am sorry to say that, in many cases, prospective buyers have not been able to find that accommodation

  973
  when they have required it, and this undoubtedly must have had some effect, probably a great effect, upon the sales of the commodities manufactured there.
  I would like to quote one illustration of what is happening in the city. Some time ago an application was made to the Ministry for the provision of the necessary licences to enable one of the hotels right in the centre of the city to extend its accommodation and provide about 12 more rooms. The applicants have not been able to get the licences yet. Those rooms are required, in the first instance, to accommodate members of the staff of the hotel who at present are using rooms in other parts of the town. Their present rooms would become available for other housing accommodation should they be housed in the hotel itself. It would also mean, of course, the saving of the transport, and everything concerned with moving these people to their place of work. In addition to that, there would be a certain number of rooms available for visitors to the town, which would enable them to enjoy proper amenities that are necessary for visitors—buyers and sightseers. I cannot understand why, in a case like that for example, the licences should not be given. The necessary alterations and repairs are not unduly heavy, and in my view they are very necessary.
  The other point is this. We are encouraging, or endeavouring to encourage, tourist traffic to this country. It would result in an import of foreign exchange which is very highly needed. The seaside resorts will continue to attract visitors from abroad as well as from the British Isles, but there does come a period in the height of their season when they are not able to accommodate, even with the best intentions in the world, all the people who would like to be put up at their hotels and in their boarding houses. On those occasions—as indeed throughout the year—it is not unreasonable to expect that if we want to encourage tourist traffic into this country, such places as Leicester, and the county of Leicester, should not be overlooked. Leicester is a historical city, with a very great attraction for people who are interested in the history of this country and in the beauteous features of the English town. Leicestershire, with its historical background, and its beauties of scenery and countryside,
  974
  would be, and indeed is, a great attraction. We are asking the world to come to our cities and countryside—and far be it from me to suggest the seaside resorts should not also be visited—there are times when the seaside resorts would concede the point that they could not accommodate those people who might want to come over to this country. If we advertise the advantages of visits to our country —and we should advertise these throughout the length and breadth of the world, because we have some of the most beautiful scenery in the world here—as the Government have said they propose to do, it is not a bit of good doing so and then finding, when the tourists come here, that they cannot be properly accommodated.
  It is because of the following reasons therefore—firstly, in order to provide accommodation for people who are coming to do business in this country, and so increase our export trade; secondly, in order to give those people an opportunity of enjoying the beauty of our countryside and towns at the same time; and thirdly, to attract holidaymakers, to our country, and particularly to our cities and countryside—that I ask if we cannot, as speedily as possible, get the position eased, and facilities given for improvements for the amenities of people of that nature when they are here.
  1.45 p.m.
  Wing-Commander Roland Robinson: The tourist industry is one in which I am very keenly interested, and I want to take every opportunity to impress upon the Government the necessity of doing something to get it going again in the postwar years. I have pressed it on the House on many occasions, and I have given figures to show its size, so I feel it is hardly necessary for me to repeat them again this afternoon. However, we must help now, because at the moment the Government are doing all they can to encourage our export trade, and to get more foreign currency, which we need to buy certain essential imports for this country. As I have said many times, we can get a lot of foreign currency if we develop our tourist industry, because in it we have a really good wage earner. I think it would be a very wise thing if, instead of sending a major portion of our goods abroad today, we kept some of them at home for

  975
  the re-equipment and the rehabilitation of the hotel industry, which will continue to draw dollars and francs to this country for many years to come.
  When we are considering the rehabilitation of hotels, especially those with which the foreigner is concerned, I think that in the postwar years we will have to revise our ideas entirely. Many of us can think of Americans who used to come over to this country, who visited London, Edinburgh and Stratford-on-Avon, and many of them thought they had then seen England. During the war we had hundreds of thousands, and more, American troops in this country, who have been stationed all over the country, and in each little part of the country. They have made friends, and they are going back again to those places when they pay their return visits to this country. Therefore, we must, in attracting foreign tourists, get away from the idea of visiting only London, Edinburgh and Stratford-on-Avon. It is the whole of the country which is concerned with this very important industry. I do not want the Government to treat the matter merely as one from the point of view of attracting tourists to this country, but to consider it from the point of view of the British workers too. Many of us have worked and fought for holidays with pay. It is an accepted and recognised factor in industry today. It is also accepted on many sides that many of the British workers are getting tired. We have appeals going out from the Government to the workers to produce more. But if the worker of this country has to produce more, then we must make him physically fit to do the job. More important than ever to him now is his holiday, and we must get the catering and tourist industry so good that next year the workers can have a good holiday in reasonable comfort. Then, when they go back to their work refreshed we will begin to get more and greater production from the individual worker.
  I recommend the industry to the Government, too, because it is a very big employer of labour in this country. It is an industry which is trying to improve the conditions of the workers. We will never get conditions improved unless the Government are prepared to face up to the need of improving many of the kitchens and working conditions of the people in the hotel industry of this
  976
  country. They cannot do that without the licences which have to have the approval of the Ministries concerned. One of the most important things at the moment is to get on with the job of derequisitioning these hotels. All over the country there are masses of hotels which are still held by Government Departments. I think everyone in the House knows how very hard it is to shift a Government Department once it gets into a building; it does not want to go. I hope the Minister of Works will fight really hard with the other Government Departments to try to throw them out of those premises which we need. It is a very live fact that in my own town, Blackpool, when we had a very important political conference there only a few weeks ago, many hon. Members from this House who came there found that practically every one of the big hotels in the town still requisitioned and not freed by the Government Department to do the job for which they were built, and for which they were constructed. I hope in the reply today we shall hear that the policy of derequisitioning will be speeded up very much indeed.
  After derequisitioning we have got to be in a position to repair our hotels, and I urge that the Minister of Works should realise the necessity for giving the building licences for a reasonable measure of repair, and for modernisation, too. The Minister of Works knows that all of us on all sides of the House have as one of our aims housing for the people of this country. When we suggest the neccesity for these licences being granted, we are not suggesting that work should come before housing. We are not even suggesting that it should be equal to that of housing the people of this country. But, as this is an industry, to my mind the repair of the hotels can well rank with the repair and modernisation of factories, which are going on all the time in the country today. If we can bring our factories in this country up to date, surely we can do the same thing for the hotels. I can assure the Minister that this is being done in other countries. When I took my car to the continent in August I stayed in several hotels which had been damaged by bombs. They had been opened again, and one part of a hotel would be newly painted, even though the other half was open to the skies. That was the case with many hotels.

  977
  In wanting our hotels back we want a certain measure of rebuilding, and when we have got that we need to have reequipment. We want the help of the Board of Trade to see that hotels get the necessary articles. If we are to attract visitors to this country it is no good offering beds with torn, worn out sheets that people would not have in their homes. I think it was the President of the Board of Trade who said the other day, that at times he slept with his feet sticking out through holes in the sheets. He may get some form of pleasure out of it, but I do assure the House that foreign visitors to this country, though they may think it funny to see the President of the Board of Trade in that position, do not want that experience for themselves. We have got to try to give them, if we want them to come over again to this country, the same standards which they have in their own countries. It would be a fatal thing if, in launching, as we are trying to do now, a drive to bring foreign tourists here we sent them away dissatisfied, so that they did not come back again to this country. Can we have from the Board of Trade some help in getting our beds and our mattresses and tables and chairs and the kitchen equipment which we need? We have these things. A great deal of them is being exported from this country today. Let us keep some of them at home to get this industry going.
  I do not want to go much farther. We have in Debates on this subject in the House had from individual Members of the Government a great many friendly statements, saying, "Yes, it is an industry that must go forward. Certainly it must have practically everything it wants." But I often think individual Ministers tend to pass the buck. The Board of Trade is liable to feel that the industry cannot have these sheets, but if the Minister of Works does his job, and gets some buildings derequisitioned, then the people in the industry will be happy. It is the same sort of story with regard to derequisitioning itself. I have no doubt that spokesmen of the Air Ministry think it is wonderful, indeed, to give hotels back to the people who own them and wish to operate them. But they think the Ministry of Works should get out of hotels, and that the Ministry of Food and the War Office should get out of hotels; but the Air Ministry itself cannot get out, because it is very important. I
  978
  think practically every other Department has the same idea about the hotels it is requisitioning—that Government possession of them is necessary in the national interest. Every Department thinks every other Department should get out of the hotels that it has requisitioned. All the Departments hold that view, but none get out, and the industry is handicapped.
  I feel that in this country we are going to have a great expansion of the hotel and catering industry. We have more people having holidays than ever before, and we have a great many coming from abroad. Therefore, we must not put the industry in such a position that we have a closed industry into which newcomers cannot enter. I have been fighting one case with the Ministry of Works for a number of months now. It is the case of an ex-Serviceman who returned from the Service and put his savings into buying a large private house, and thought of re-equipping it, and carving up some of the bedrooms, whereby he thought he might double the accommodation in that house, and run some business from it. But the Ministry of Works pointed out to me that this man was not in business as a hotel-keeper before the war, and, therefore, indicated that this was a closed industry. There should be many newcomers. It seems to me entirely wrong that there should not. We need an expanding industry. We are building it up as we have never built it up before, and we should welcome new people. I urge the Minister of Works to help us in this matter. I sometimes think the Minister has not realised enough the needs of the industry, and that Ministers, in their zeal for housing, are liable to forget it.
  I have still another letter on the same case, written four months after the first. The Ministry of Works was asked to keep a building open as a small hotel. The Ministry said that, unfortunately, conditions in Blackpool had not eased, and they were still unable to allow improvements to existing buildings, and that if this work were carried out, although the number of bedrooms would be increased, they would be available to holiday makers and not form a contribution to the housing problem. We know this is not a contribution to the housing problem. It brings me back to the point I was making. Hotels should have the priority which

  979
  is accorded to industry, so that places like this can be opened and get on with their normal work.
  1.57 p.m.
  Sir Peter Macdonald: This is a subject which I myself have raised on many occasions both in the last Parliament and in this Parliament. We have had many assurances from different Departments, under the last Government as well as this, that priority would be given to seaside resorts for the rehabilitation of their hotels and accommodation. We have had one season. We have had a summer to test out the sincerity of the Government's pledges. We have managed to get through the summer, and we have now an opportunity of reviewing the situation, and of seeing to what extent these promises have been fulfilled, and to what extent hotels are in a position to accommodate both the summer visitor and their day to day guests. I have found in my constituency—and it is no exception—that there are still a great many deficiences in our hotel accommodation.
  A point raised by a great many people is the granting of licences for repairs and maintenance. I find a great many people have mentioned that the requisitioned hotels—I have a good many of these in my constituency—have been handed back, and that they have fared better, I think, than those that have been kept going in the war, so far as rehabilitation is concerned. They have been repaired, and in many cases re-equipped, and now are in a better position, many of them, than they were before the war. That does not apply to the hotels which very gallantly tried to keep going and struggle on through the whole of the war to provide accommodation for travellers.
  There are one or two instances of that kind in the Isle of Wight where a great deal of rehabilitation is necessary. There is one particular case of a very progressive hotel proprietor who is very anxious to get on and bring his hotel up to date. He applied for a maintenance licence to restore his rooms and provide proper accommodation for his staff, which is vitally important if staff is to be found. These days they demand accommodation which they might not have expected before the war; indeed we expect our hotel staffs to be better looked after than they
  980
  have been in the past, and their first demand is, of course, for proper accommodation. How is that proprietor to provide accommodation if, when he applies for a licence to add to or restore his rooms, he is granted a licence for £150? That sum will hardly restore one room if proper equipment is to be put in, and in the case of a large hotel at that rate it would take 50 years to restore. I know what the demands for housing are, they are really urgent indeed, and I would not for one moment suggest that hotels should come before houses, especially in those areas where housing is very short. But if hoteliers are granted licences to carry out repair work during the winter months, I think they would be able to do it. There are certainly times when decorators, painters and other people who are not able to work on housing during the bad weather in winter could get on with some indoor work in restoring these hotels. I recommend that suggestion to the Minister, to grant licences and allow an extended period for carrying out the work during the winter.
  As regards equipment, linen and carpets have been mentioned. People are finding very great difficulty in getting dockets to restore them, and I ask the Board of Trade to be a little more generous in that direction. Some places have fared better than others, but many hoteliers have been very badly hit in that their hotels have been closed during the whole of the war. There is an area where visitors were not allowed and the hotels were closed up, with the result that moth has destroyed all the carpets and all the bedding. Some of the sights at seaside resorts would horrify anyone who sees the appalling destruction caused by moth. Those hotels must be restored, but cannot be without some assistance from the Board of Trade. The cost of equipment today is appalling. I have had a list sent to me showing the comparative cost of linen and hotel equipment now and before the war, and in some cases it is 600 per cent. up. That in itself is enough to cripple the hotel industry or any industry trying to get on its feet again. It is very largely due to Purchase Tax, and I ask the Minister to consider whether it is possible to press the Treasury to make some concessions on Purchase Tax in the rehabilitation of hotels.
  Priorities of the highest order were given for the restoration of the "Queen

  981
  Elizabeth," and the same has been done for the "Queen Mary," and I think rightly so, because they are bringing thousands of people to this country and will continue to do so every week. Those ships come past my constituency in order to dock, and passengers very often say, "What a beautiful place that is; before I return to America I want to visit that island." They do, but after having been in the "Queen Elizabeth" with its palatial accommodation they find that the hotels in the Isle of Wight have not had facilities to rehabilitate themselves after the devastation of the war. I, therefore, want to ask the Minister to be a little more lenient in granting rehabilitation, repair and maintenance licences to those people who are struggling hard to restore our hotel accommodation in order to assist the tourist trade, which the Government have so often said they wished to have restored in this country.
  2.7 p.m.
  Mr. Cooper-Key: The speedy rehabilitation of this industry is generally recognised as being a matter of importance to the country, and there are certain areas where its rehabilitation is vital. I refer to those areas which have no alternative industry, and particularly to those on the South coast of England, some of which have been very badly damaged by bombs and where compulsory evacuation caused some 95 per cent. of the hotels to close down. The effect of the closing down was that the proprietors removed the contents of their hotels elsewhere in England, so that it remains for newcomers setting up in business, many of them ex-Servicemen, to try to find equipment to furnish the amenities for the visitors who come to that part of the world. There are several ex-Servicemen in the constituency I represent whom I know personally and who have got these buildings and cannot get any furniture or linen to set up an hotel. Without curtains, carpets and linoleum it cannot be done, and they cannot even get blankets. Some of the details I have learned have been well nigh beyond belief. There are cases of people owning small lodging houses and hotels with between eight and 15 bedrooms who have not enough linen to furnish more than two or three beds. They are using flourbags and cut up old sheets for tablecloths and table napkins because they cannot furnish any better linen. That, after 18 months
  982
  of peace, is surely a matter which reflects very poorly on the amenities of our seaside resorts.
  I want to ask the Minister whether he will apply the very highest priority to those hotels which are not being occupied because people cannot open them up through lack of equipment. I would also like to see a special priority given to the repair of bomb damaged houses, remembering always that the area to which I refer was the most heavily bombed in the country and also suffered the compulsory evacuation of its people. I should like to make one constructive suggestion, and that is that a maintenance licence might be granted in these special cases so that the equipment could be obtained. On the basis of so much per letting room, say, £200 for a 10-room house, I believe that would be of great assistance in helping out the most penalised of all hotel areas—the South coast towns. We have heard today the various inducements for people to visit various parts of the country—the camellias in winter, soft winds of the East coast and views of the "Queen Elizabeth" sailing on the Solent. In spite of the rather dismal picture I have painted of the conditions in my constituency, I can assure those who feel inclined to try us out next year that they will, with the assistance of the Ministry, find better conditions and that we shall be able to cope with what I am sure will be a record demand for accommodation.
  Mr. Marquand (Secretary for Overseas Trade)rose—
  Mr. C. S. Taylor: Before the Minister replies, may I ask one question?
  Mr. Deputy-Speaker (Major Milner): It must be only a question.
  Mr. Taylor: May I ask whether the Government have any intention of appointing one Minister to deal with the various problems which have been raised on behalf of the hotel industry, because at present the industry have to deal with the Ministry of Food, the Board of Trade, the Ministry of Health, the Ministry of Labour, the Treasury and the Service Departments?
  Mr. Deputy-Speaker: This is going further than a question.
  Mr. Taylor: I hope that the Minister will deal with the question of a Minister being made responsible for these matters in the House of Commons.
  2.13 p.m.
  Mr. Marquand (Secretary for Overseas Trade): I do not want to cut short a Debate in which many Members are anxious to participate—indeed, I cannot do so—but I feel that I shall be more helpful to the House if I rise at this stage to deal with the large number of questions, particularly that question which has just been asked and was also asked at the beginning of the Debate, because it seems to me that we are in danger of repeating ourselves. Like all hon. Members who have spoken, I am very grateful to the hon. Member for Lonsdale (Sir I. Fraser) for having used his opportunity to raise this question, and I am glad to have the opportunity to make a comprehensive, but not, I hope, tedious statement. The Debate has covered a very wide geographical range, from Lonsdale and Blackpool in the North, to Bath in the West, Lowestoft in the East, St. Ives, the Isle of Wight and Hastings in the South, not forgetting Leicester in the Midlands. I am tempted to speak for Wales, but I will say no more than that she will not be forgotten, nor will Scotland whose voice has remained silent today.
  We have not only had an indication of the great interest in all parts of the country in this subject, but also an indication of the varying needs of different types of centres—the business centres, the tourist centres which attract overseas visitors, the centres which attract home holiday makers, and those particularly difficult centres which suffered special wartime injury, the centres on the coast line in certain areas where there was complete requisitioning and where heavy bombing in many cases took place. I will not he able to answer every one of the interesting points which have been raised, but I assure hon. Members that if their particular point is not specifically mentioned, all the matters which have been raised will be carefully considered when we read and study this Debate next week. I must begin by referring to the point which was raised by the hon. Member for Bath (Mr. Pitman), and by the hon. Member for Eastbourne (Mr. C. S. Taylor) when he asked his
  984
  question, and that is the administrative arrangements which are being made by the Government to carry out their responsibilities in regard to tourism. Before the war, responsibility for the encouragement of the tourist trade lay with the Department of Overseas Trade, and the Government grants-in-aid to the Travel Association, which was the principal agency in this field, was borne upon the Vote of the Department of Overseas Trade. Other Government activities in this field before the war were purely regulatory.
  During the war several positive actions were taken by Government Departments, in which the most conspicuous was the Ministry of Food. At a later stage during the war special responsibilities were given by this House, by Act of Parliament, to the Catering Wages Commission. When, at the end of the war, we came to review the administration in preparation for the big developments which we felt were necessary, we found that there were a large number of Ministries with an interest in this particular field. We wanted to develop not merely the overseas trade and the attraction of overseas visitors, but to ensure that the catering and home holiday services kept in step with the services provided for overseas visitors. We are now assured that 14,000,000 workers, or some such figure, are now entitled to holidays with pay, and we want these workers to have a longer and better holiday than before. How could we make provision for this? We found that there were no less than eight Departments with a special interest, as the hon. Member for Bath has told us, and there were other Depatments with not so much interest, but with special interests, which were involved to some degree.
  The Ministry of Food is obviously greatly concerned with the catering industry. The Ministry of Labour is concerned with any questions of providing additional labour for rehabilitation and reconstruction, and, above all, in the welfare of the workers by obtaining satisfactory holidays. The Home Office still perfoms its regulatory functions in regard to drinking habits and other things connected with tourists. The Ministry of Town and Country Planning has an interest, and, above all, the Ministry of Works has a special interest at the present time because of the problem of recon-

  985
  struction and rehabilitation. The Board of Trade is involved because it is responsible for the textile industry, the furniture industry and the pottery industry whose products are essential for the reconstruction and rehabilitation of this trade.
  We could not create a new Ministry to override or take on all these varying functions. The solution obviously lies in the direction of coordination, rather than in the establishment of some new authority. Coordination is what we have attempted to do. We have said, and the Prime Minister has announced, that responsibility in this field will rest henceforth with the Board of Trade. That does not mean that the Board of Trade will try to do the business of the Ministry of Food in allocating food to establishments, or that they will try to do the business of my right hon. Friend the Minister of Works in granting licences. It means that the Board of Trade will lead the team and will take the chair at the Interdepartmental Committee established for the purpose.
  Indeed, I have been given the responsibility of taking the chairmanship of the Interdepartmental Committee which we set up, on which, in addition to the Board of Trade, the Ministry of Works, the Ministry of Labour, the Ministry of Food, the Treasury, the Ministry of Transport, the Ministry of Education, the Scottish Office and the Home Office—and these are given in order of recollection and not in any order of importance—are all represented regularly, and from time to time, and as necessity arises, other Departments are called in, if their particular interests become involved. Merely to create a committee would not necessarily get the requisite action that is required. I quite agree, though I think that the Committee is necessary, and I think that those members who spoke about this, especially the hon. Member for Bath—I am sorry he is not here at the moment—who had gained such special experience during the war in the organisation of Government Departments would agree that it is along the lines which they would think satisfactory.
  But we needed, in the Board of Trade itself, also to create special machinery for this purpose. The old Department of Overseas Trade has been absorbed into the Board of Trade, and has become the Export Promotion Department, but we were not content to leave this particular
  986
  Board of Trade function to the Export Promotion Department only, because it involved all these problems of linen, furniture, pottery, etc., to which I have already referred.
  Mr. Marlowe: Before the hon. Gentleman leaves the point about the Interdepartmental Committee, would he say whether there is any arrangement as to how often it will meet? Will it have regular meetings, or will it meet as required?
  Mr. Marquand: It meets as required. We created in the Board of Trade a new Division altogether, the Tourist, Catering and Holiday Services Division, over which we placed an Under-Secretary, in other words, a Division of equal authority and prestige to other important Divisions in the Board of Trade. Perhaps I ought, in passing, to indicate that the creation of a special Division of this kind within the Board of Trade does not in any way indicate the intention of the Government to nationalise the industry. There is sometimes a good deal of suspicion on these matters, and I may as well make that clear. The new Division is to perform the Board of Trade's function.
  The Board has its own special function of encouraging the foreign visitor and providing the necessary equipment for hotels, and of leading the team of the other Departments who seek to do this job. Even before that Committee was established, about three months ago, if I recollect aright, before we had gone through the necessary procedure for establishing a committee of that kind, we had created a small working party. A "working party" is almost a Whitehall slang term for a rather informal committee. This working party was active and busy, and became known currently in Whitehall circles, I understand, as "the Fire Squad." Here was a group of the senior officials from the Departments principally concerned, set to work on the special job of preparing for the 1947 holiday season, and the chairman of that little group was an officer who had gained great experience in wartime Departments in the quick planning of operations and the coordination of the activities of other Departments, the granting of priorities, etc. They did what I think was, in all the circumstances, an excellent job.
  I pass from the administrative mechanism by which we have already tackled this problem—from the ad-

  987
  ministrative mechanism we hope to use to deal with it in future—to some of the problems with which we have to deal. Let me first mention the derequisitioning of hotels. On 1st January, 1945, the Government held under requisition 4,190 hotels, boarding houses and restaurants. On 1st October, 1946, that number had been reduced to 558. In other words, 86 per cent. of the number of such establishments held had been derequisitioned within the period from the beginning of 1945 to October, 1946.
  Wing-Commander Robinson: It would help us a great deal if the hon. Gentleman could translate his figures more into bedroom capacity. Have a lot of small hotels been derequisitioned and the big ones been retained for Government Departments? It is a matter of assessing what is the capacity of the industry which is kept by the Ministry.
  Mr. Marquand: I agree that it would be more satisfactory if I had the figures in square feet, but unfortunately I have not. It is quite clear, however, that a percentage of 86 must include a very substantial proportion of the total space. Hotels were given a priority of release. They are being released more quickly than other premises which my right hon. Friend holds under requisition. The Board of Trade now takes on the responsibility in advising upon and indicating the type of policy which might be followed in derequisitioning. All the Departments concerned recognise the need for derequisitioning the hotel and catering facilities of the country as quickly as possible. We are aiming at reducing the present number of 558 to about 300 by 1st April. It may be said that that is a slow rate of progress. So it is. Inevitably it becomes more difficult as the end is reached, and there are places—the hon. Member for Bath quoted one of them—which it will be difficult to release for some time to come.
  This country had to suffer heavy damage by bombing. The destruction of office equipment and the damage of all kinds of building are quite as much responsible for the present situation as the growth in the size of Government Departments. We would like to attain complete release by the end of 1947, but I am not undertaking to achieve that end. We would like to do so and that is the sort
  988
  of thing that is in our mind, but I cannot call it a target, because the conception is a bit too nebulous. Our ability to achieve that objective depends mainly on the degree of scarcity of building labour and supplies. We cannot put office or hotel building before house building, and I do not think that any hon. Member would ask us to do that in the light of the present state of things in this country. Some of this space is absolutely needed for Government purposes, and could only be released if completely alternative satisfactory accommodation could be found.
  Sir I. Fraser: Would it not really be better if there was less accommodation for the Government and more accommodation for the governed?
  Mr. Marquand: Yes, but it is a matter of gradual reduction. I do not intend to be led into a discussion on the size of Government staffs, which are being gradually reduced. Suffice it to say we are, and this is the point I want to make, giving priority to the release of hotel space in this programme of releasing the accommodation held by Government Departments at the present time. There were suggestions in the speeches of the hon. Member for Lonsdale, and other hon. Members, about the delay in derequisitioning. If so, I regret it, and my right hon. Friend the Minister of Works regrets it, and we will look into any specific instance that may have been raised in the course of this Debate. I must point out that my right hon. Friend has sometimes been requested by those whose properties have been under requisition not to be too quick in releasing them from that arrangement.
  I pass now to rehabilitation. We feel that we want to rehabilitate the hotels, particularly those which have been requisitioned or damaged by enemy action. But, at the present time, we must restrict the work to essential rehabilitation. That means that we are not prepared to consider extensive improvements. From time to time, applications are received for substantial extensions and improvements, many of which have attractive features, but it would not be fair to use our scarce building labour and materials for that kind of work in the present stage of our progress. However, in order to ensure that the best possible judgment is brought to bear upon this derequisitioning, which is essential and must be delegated to officials all over the country—and every piece of

  989
  which cannot possibly be brought under Ministerial observation—we have brought our regional organisation into play. This is one of the advantages of having a united Board of Trade containing the Export Promotion Department, the old Department of Overseas Trade, as well as all the other departments in the Board of Trade. We have been able to use the Board of Trade regional organisation. Just as we were able to appoint export officers who were valuable and appreciated by the community, so here we brought the regional organisation into play. As at the centre in London, the departments in the regions now work in a coordinated way, and circulars have been issued to the regional licensing officers of the Ministry of Works instructing them urgently to consider the projects benefiting the tourist and holiday services. They keep in touch with their colleagues in the Ministry of Food, the Board of Trade and the Ministry of Labour in these matters, so that they march in step together.
  We have to have particular regard to the need in 1947 of attracting overseas visitors, and I shall say more about that in a moment. The business centres are important as, also, are the centres like the Lake District, Stratford-on-Avon, and so on, to which these visitors want to come. To comment on a remark made by the hon. Member for Bath, I would say in passing that we already have, and have had for more than 12 months in the Export Promotion Department of the Board of Trade, a special Tours Section which looks after the interests of the overseas business visitor. It arranges to meet him on arrival and helps him with the problem of his hotel accommodation, his registration and the various formalities that have to be gone through, a service which, I am glad to say, is much appreciated. Perhaps I should not make too much of that service in case too many seek its assistance. When we hear from our overseas officers that important business visitors are coming, we take great pains to get into touch with them. We arrange for them to be taken from the station to the hotel and, if necesasry, find them hotel accommodation.
  Mr. Pitman: May I ask the Secretary for Overseas Trade whether he would welcome that service being made known when one is overseas, because I have met a lot of people who are important who are not
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  aware of it? It is the sort of thing they would appreciate, and I am glad it is being done.
  Mr. Marquand: I am a little afraid that my remarks today may make the service too well-known, and I am sure hon. Members will appreciate that it would be a little difficult to have hundreds of people using a comparatively small service, because, if it broke down and one had to discriminate, those left out of the charmed circle would want to know why. It is a very discreet service to which people who are likely to place substantial orders with us would be welcome.
  Brigadier Low: Is it a service for those whom I would call V.I.Ps., or a service for ordinary people? If it is a service for ordinary people, does the Secretary for Overseas Trade imply thereby that the hotels and other agencies in England are not advertising properly abroad?
  Mr. Marquand: This is not a service for ordinary people; it is a service for visitors who come with a recommendation from overseas officers and who are concerned in a particular commercial contract or deal. That is all it is, and all it could be. We shall cater otherwise for other visitors, as I shall go on to describe. We are still talking about rehabilitation. I want to explain that there can be no rule of priority laid down from the centre in this matter. The degree of priority given in rehabilitating hotels and other catering premises by means of building licences must vary from area to area. For example, in the Development Areas where we are trying hard to build new factories, and where we cannot build the factories fast enough to absorb the unemployed labour at the present time, we are obviously not going to spare the scarce building materials for the re-equipment of hotels, however desirable that might be in cities like the one which I represent. There must be a system of local priorities in this matter. In other areas, where there may be an easier housing situation and where no vital factory building is going on, such as in some of the lovely tourist areas where nobody wants to see factories going up, the thing is easier, and it is possible to carry out a more rapid rehabilitation in some parts of the country than in others.

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  I cannot agree that there is no conflict between housing and factory building, on the one hand, and the rehabilitation of the hotel industry on the other. There must be some conflict in some areas, and, where that conflict takes place, housing and the building of factories must come first. I would ask hotel proprietors who are considering putting forward their projects to bear in mind also that there are certain things among these building materials and equipment which are particularly scarce. Baths are difficult, and paint is in very short supply owing to the world shortage of linseed oil. Projects requiring baths and wash basins and large quantities of paint must necessarily be more coldly received than those which do not require such quantities of these things.
  I will now pass to the question of equipment, which is a special interest of the Board of Trade. Early this year, we created a special scheme within the Board of Trade for the supply of limited quantities of sheets, blankets and mattresses to bomb-damaged and requisitioned establishments which were able to open by 31st July. That scheme gave a little preference to the bomb-damaged and requisitioned establishments over others which have been fortunate enough to carry on their normal business throughout the war. I feel that the preference was justified. Needless to say, the many applications quickly absorbed all that we were able to make available at that time. We also decided to import a certain quantity of bedroom furniture specially for the hotels in order to enable them to re-equip themselves, and I am glad to say that that furniture is arriving in this country at the present time. We also had a special scheme for the allocation of upholstery cloth to hotels, boarding-houses and holiday-camps in order to enable those places to cater for the holiday traffic of this year. I was going to say "summer," but I hardly know what is an appropriate word by which to describe the months from June to September of this year.
  A great deal more needs to be done for the 1947 season and we are working on the same lines as last year. I wish that the increase meanwhile in the production of blankets, sheets, and mattresses had been as great as we hoped; it has not, but for 1947 we shall carry out a somewhat similar scheme to that in 1946. I am not
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  able to announce it today but I hope to be able to do so before the end of November. We are planning to be ready for the 1947 season, but these items of equipment are all very scarce. Towels and other textile goods were alluded to, and I was glad and indeed not surprised to find that the hon. and gallant Member for Lonsdale recognised that we must continue to export such goods at the present time. Our total cotton textile exports represent only 16 per cent. of our production, and they are heavily restricted. I frequently have to answer in correspondence the complaints of hon. Members on all sides of the House that their constituents are not permitted to export as many of these things as they would like to do. At a time when we are under heavy obligations to the Dominions overseas to keep them supplied with at least a modicum of these goods, and at a time when, whenever we go abroad to buy our eggs, butter and bacon, we are asked, first of all, for coal, and secondly, for textiles, we certainly have no intention of reducing the volume of exports below its present level. But as home production increases the quantity going into the home market will increase faster than that going to export. It all depends on the satisfaction of our home needs and, as in many things, an increased production at home. If we get the increased production from the textile industries we shall be able to do these things for the hotels, but while the shortages remain we shall apply the sort of priorities and rationing schemes I have already outlined.
  I would conclude by saying that we are aiming to begin the traffic in foreign and overseas visitors to this country in the summer of 1947. During this last summer my right hon. Friend the Secretary of State for the Home Department has instructed his offices abroad not to grant visas for those who wished to come for tourist purposes only. As the House knows, that ban has now been lifted. Visas will be granted freely where they are still necessary, and there will be no deliberate obstacle in that way to the coming in of visitors from overseas who will bring with them that foreign exchange which we so badly need to pay for our necessary imports. Space, of course, will be limited. The hon. and gallant Member for Lonsdale referred to

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  the difficulties of our South African relatives who wish to come here, and I know how difficult that route is.
  Therefore, the total number of overseas visitors who will find it physically possible to reach these shores in 1947 is of reasonable dimensions. We have calculated that figure with great care with the Ministry of Transport and the other Ministries involved on the Committee of which I have spoken. We have arrived at what I think is a pretty accurate estimate of the total and of what the peak will be, and we have broken that peak down into beds, blankets, mattresses, and other necessary things. We have something like a wartime plan— of the kind that we had for aircraft production during the war—to apply to the tourist trade. The number of our overseas visitors will be necessarily limited, and they may find when they arrive a standard of feeding and accommodation which is lower than that we should like to provide for them. They may, in fact, find standards which are lower than those which prevail in their own countries, but we shall say to them, with some diffidence and apology I suppose, "We are sorry but we cannot entertain you better." But there will be a little ring of justifiable pride in our voices because we shall know that the shortages they may have to put up with are due not to our lack of desire to see them, or to any lack of effort on our part to provide for them, but simply to the damage and injury which we sustained during the war in an effort which was to their benefit.
  2.45 p.m.
  Lieut. - Commander Joynson - Hicks: I appreciate very much the opportunity of making two points arising out of the Minister's speech. Those of us who have been fighting this battle of the seaside resorts for upwards of three years have a very considerable experience and knowledge of the difficulties with which the Minister is now faced. In the coordination of the work of the ten to twelve Government Departments involved he succeeds two Cabinet Ministers, and it is no disrespect to the hon. Gentleman when I say that I only hope he will have the power and strength behind him to be more successful than they were. That is the first point I wish to make. He has a very difficult job before him in the coordination committee over which he tells
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  us he is presiding, and I am perfectly certain that we on this side of the House will give him every help we can by strengthening and rendering more powerful the coordination which is essential, and which hitherto has been a complete failure. We hope that he will very shortly be coming before the House again to tell us what the committee is doing and what it has achieved at the regular meetings which he says it is holding.
  The second point I wish to make is to beg the hon. Gentleman not to lay undue emphasis upon the foreign and overseas visitors. I appreciate the natural bias which he would tend to have in this respect, but there are many seaside resorts in this country which do not cater for the foreign visitor at all. They cater for the English working people from the Midlands, the North, and from all the industrial centres as well as from the country. The areas which I represent are particularly of that type—Littlehampton, Bognor Regis, the Witterings—and the number of foreign or overseas visitors who come there for their holidays or for visits represents a very insignificant percentage of the total vast population which comes there during the summer time from inland counties. I, therefore, beg the Minister not to overrate the assistance which he is going to give, and which I believe he is determined to afford the seaside resorts in favour of those resorts which naturally flow through his own Department. May I remind him of the hope held out to us by the right hon. Gentleman who is now the Foreign Secretary when he was speaking on the Second Reading of the Catering Bill? The right hon. Gentleman said then—during the war—that it was of first priority that immediately the war was over the seaside resorts should be rehabilitated in order to ensure that the workers of this country had an opportunity of themselves becoming rehabilitated.
  2.48 p.m.
  Brigadier Low: I should like to make two short points in connection with the coordination mentioned by the hon. Gentleman. I hope he will see that this coordination takes place on the ground as well as in his offices. For a short time in Blackpool in the middle of last winter there was a touring circus consisting of representatives of a number of Government Departments. This kind of thing is easier in

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  Blackpool than in other places because there are so many Government Departments already there. However well the Minister coordinates things in his own office it is useless if that coordination does not allow a speedy solution of the problems which confront hotels, both small and large, at the present time. I hope the hon. Gentleman will not leave out of account the many hotels, particularly the large number of small hotels, that carried out special services for the Government during the war, either by turning themselves into offices and having their walls knocked down, or by giving their whole accommodation over to the Government to house Government servants or members of the Forces. Perhaps he will give these people special consideration. They have used up a lot of equipment, and those who have had their houses knocked down sometimes lack bricks which, as his right hon. Friend will tell him, are in superfluity in Blackpool, so that there will be no difficulty in giving those. I hope he will give these people special attention because they have deserved well of him during the war.

  P.A.Y.E. (EFFECT ON PRODUCTION)
  2.50 p.m.
  Mr. Osborne: I apologise for raising so late a matter which I consider to be of great importance, but it is of such importance that I thought it should not be left over. I want to draw the attention of the House to what I believe to be the evil effects of P.A.Y.E. on production. We have heard a lot from time to time about the Battle of Britain. We are now faced with a battle of production, and the consequences of losing this battle will be nearly as important as if we had lost the Battle of Britain. Everything depends on winning this battle. From time to time appeals have been made to the employers and employees to do better in the matter of production. We need more coal, houses, clothes and food, or the social policy of the Government cannot be carried out. The Prime Minister, very wisely and courageously, has made an appeal to employees and trade union leaders for greater production. Its greatest enemy is neither the trade unionists nor the employers—it is the Chancellor of the Exchequer who is pre-
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  venting output more than any other person.
  It was only about three years ago that P.A.Y.E. was introduced in this House. It was the last act of the late Sir Kingsley Wood and was introduced by the right hon. Member for the Scottish Universities (Sir J. Anderson) as his first task as Chancellor of the Exchequer. The idea behind P.A.Y.E. as then introduced was to prevent an accumulation of taxes and to allow working men to pay their taxes on their current income so that they would not have debts accumulating. During the war it did very good service, but it has outlived its usefulness. It was called the Wage Earners Income Tax Act, and it is the effect on the wage earner that I want to stress. The wage earner hates the tax, does not understand it and will not do his best because of it. P.A.Y.E. is a perfect example of something which is excellent in theory but works out badly in practice. To substantiate that, I would like to point out to the Financial Secretary three of its main faults.
  P.A.Y.E., as it is operating today, is one of the greatest causes towards inflation. The wage earner is a realist. He is not interested in his gross earnings, from which are deducted so much for health insurance, Income Tax and other things. He wants to know how much he will take home in his pay packet. He wants to know how much he will have to spend on food and clothing, and also on beer and tobacco. He complains that the money he takes home is not enough for a man to live on. He may be told that deductions for certain things have been made, but he is not interested in that. When he looks at his net wage, he says that it is not enough for him and that he wants more. P.A.Y.E. is a very important factor in the inflationary move which we are now suffering and which the Financial Secretary will agree is one of the great dangers facing us. The old system lost us a certain amount of revenue, but the wage earner did handle the whole of his gross earnings, from which he put aside certain amounts for his tax liability, his rent and his rates. Therefore I submit that P.A.Y.E. is causing a demand for higher wages.
  Another weakness is that P.A.Y.E. is causing industrial workers to be dissatisfied and disquieted. The industrial worker feels that he will not do his best. Unless he feels he is being treated properly under

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  the taxation system, he will not do his best. P.A.Y.E. is thus reducing industrial morale largely because of the low net wages. The industrial worker feels somehow that Income Tax, and especially P.A.Y.E., was invented by the devil to plague the bosses, and he does not think that wage earners ought to pay direct taxation. He hates it and he would avoid it if he could. One of the causes of our low production is the feeling among industrial workers that if they take a week off they will be getting back some of the money which they feel ought not to have been deducted from their pay packets. Another fault of P.A.Y.E. is that it absolutely kills incentive. I have not to explain to the Financial Secretary the operation of the law of diminishing returns. A man who does extra work has to put in more than usual effort. He finds that he is getting less and less money for more and more effort. This he will not do. It is a penalty on overtime and efficiency, just the two things we need. Speaking in the previous Debate, the Secretary for Overseas Trade said that the key to the position was increased production. We all agree with that, but P.A.Y.E. is the one thing which is stopping it. We cannot blame the industrial worker for not wanting to work extra time for less money. Unless P.A.Y.E. is removed and the worker gets what he considers to be an adequate reward, he will not put his whole heart into increased production.
  Here are one or two examples of the operation of P.A.Y.E. Friends of mine in Leicester who are high precision engineers employ men whom they pay 4s. 3d. an hour. On a 47 hour week that amounts to about £10. When a special order came in they asked the men if they were willing to work an extra 15 hours to get the order through. The men were quite willing to put in the extra time, but they asked their boss, quite reasonably, to work out for them how much they would get. It was worked out for them that for the 15 hours they would get £3 3s. 10d. extra. Under the old tables, the extra tax was £1 7s., so that they would draw £1 16s. for what they considered to be £3 3s. 10d. worth of effort. The men said they were not going to do it. Under the new tables the tax would be £1 4s., and so the men would get less than £2 for doing work worth £3 3s. 10d. May I give another example? A Kettering clothing company wrote and told me that
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  they employed many girls who readily admit that they could earn 2d., 3d., and 4d. an hour more if they went all out.
  They are all on piece-work, and an extra 4d. an hour would represent 25 per cent. more output. But they will not do it. They say to their employer that they are not prepared to work extra hours in order to pay taxes. In this industry it was hoped that with the omission of taxation on lower groups, last April, the girls would be encouraged to do better. But, unfortunately, or fortunately, whichever way you look at it, there was an increase in the rate of wages, and that increase resulted in the girls being unwilling to work extra hours. I was told that the girls could easily earn 2s. an hour, but that they are satisfied with 1s. 4½d. That means that we are losing extra output.
  The manager of a cable company in Hull told me that because one of his girl workers had done extra well she was given a 10s. bonus, but that as a result she had to pay an extra £1 Is. in P.A.Y.E. That girl said she would not work hard again. This company say that every week 10 per cent. of their workers had Saturday morning off, and sometimes Monday and Tuesday mornings as well, because they believed that what they would earn they would lose in taxation. We know it is not true that they would lose all, but they lose sufficient to make them say that they will not work on those mornings. May I give two other examples from industries in which I am interested? In Leicester, we have boot and hosiery industries, both of which are largely dependent on female labour. One of my manufacturing friends in the boot trade told me that his prewar output was, on the average, 27½ pairs of shoes per operative per week. Today, it is 24 pairs, despite the increased efficiency in administration. He says that whereas his women employees should normally work 43 hours a week they have been working, on the average, only 36 hours a week this year. It is important to remember that in that industry men employees are dependent on the work done by women. So, this manufacturer is having to stand off men because the women are not doing their work. His staff officer inquired into this position, and the girls told him that their husbands were in good jobs, or that they were getting good Service allowances, and that they were not prepared to work to pay taxation.

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  At the moment, the Leicester boot trade is short of 3,000 operatives. They are still in the country, but they are not prepared to go back into the factories because they feel that they would be merely working for the Chancellor, and not for themselves. The hosiery industry in Leicester is short of 2,000 operatives, and, if the industry could only get sufficient yarn from Lancashire and Yorkshire, could do with another 5,000 operatives. This work is largely a married woman's job and, as the Financial Secretary knows, married women were allowed only £80 a year free of tax. This has been put up to £110, but the women who could earn £4, £5, or £6 a week will not go into the factories in order to pay half of what they earn to the Chancellor. I am prepared to produce figures in proof of all this. My final example is in connection with coal, most important of all. In Leicester, we have the smallest, but the most efficient, coalfield in the country. Its output is the highest per man per shift. My friends the coal managers tell me that even in Leicestershire the absenteeism is highest among young unmarried men, who are lowest in the tax scale. It is a common practice for them to calculate how much tax they have to a certain date and then, when there is a sporting event in the district, to leave their work. If the country is to recover we must have higher output in the coalmines. To do that we must encourage the miner, and the way to do that is to abolish this tax.
  Mr. Speaker: When the hon. Member says, "abolish this tax," that is out of Order, as it involves legislation.
  Mr. Osborne: I am sorry, Mr. Speaker.
  Mr. Diamond: What is the point of all the hon. Member's remarks, if not to abolish the tax?
  Mr. Osborne: The point of my remarks is to show the evil effects of this tax on production. It is for the Government to decide what they should do. Surely the hon. Member knows that if we do not have full production the social policy for which he and I stand will not be possible. In a Debate in this House, in 1943, Lord Pethick-Lawrence, who was then in Opposition, said:
  "It might have been mentioned in the coal debate yesterday, as an additional reason
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  why the coal miner should exert himself during the next few months, that, in fact, any increase of wages which he earns at present does not involve him in any additional payment of tax."—[OFFICIAL REPORT, Thursday, 14th October, 1943; Vol. 392, c. 1109–1110.]
  To the industrial worker taxes mean P.A.Y.E. The hon. Member for Dumbarton Burghs (Mr. Kirkwood), who, it will be admitted, knows as much about working men and industrial conditions as anyone in the House, was explaining, in the same Debate, why urgent work requiring to be done on the Clyde had not been done. He said:
  "When the foreman went to these workers and asked them to do extra work … the men refused. They said that if they worked overtime the money they earned would be taken off in Income Tax."—[OFFICIAL REPORT, Thursday, 14th October, 1943; Vol. 392 c. 1128.]
  So they would not work. The problem before us, therefore, is whether the Government are to insist on having taxes or production. I do not think they can have both. Production is of the greatest importance. If the social policy which we all wish to see—better education, more houses, and a better life for everybody— is to be realised, we must make the industrial machine work with greater efficiency, and no impediment should be put in the way. The greatest impediment today is P.A.Y.E., and I beg the Financial Secretary to look into the matter and see what can be done.
  3.9 p.m.
  Mr. James Callaghan: I realise that we must steer a tricky course today, Mr. Speaker, in order to avoid transgressing your Ruling, and I congratulate the hon. Member for Louth (Mr. Osborne) on having got by so well. The hon. Member always speaks with sincerity on these issues, and with much of what he has said today I find myself in agreement.
  There is no doubt that the effect of P.A.Y.E. has been to bring home more sharply to the taxpayer than ever before what is the actual effect of taxation on each week's earnings. In the old days, when Income Tax liability was calculated only once or twice a year, and a worker was sent a bill for the gross amount, he could not relate that amount closely to what he earned on any particular day or in any week. Now, when every Friday

  1001
  pay day comes, he can see precisely what has been the effect of the three hours' overtime that he may have done the previous night, and this has brought home to him more closely than ever before the precise effect of our taxation system. It was to that that the hon. Member addressed his remarks. I rather thought that he suggested that one of the reasons for this system being introduced was that it would result in a gain for the revenue of several million pounds. That was thought of afterwards, and that the £25 million a year which the Chancellor gets over what he used to get has been a by-product of that system, and certainly was not the main reason, or one of the reasons, for introducing it. We must remember that one reason for introducing this system was the clamour of the wage-earner. It was he who, in the days when production was just as important as it is today, was saying precisely the things which the hon. Member quoted from the hon. Member for Dumbarton Burghs (Mr. Kirkwood), and it was precisely because of his claim that the system that existed at that time affected his productive effort that he said we must have a new system.
  I believe that the Chancellor summed up the whole of this problem in the Budget discussions when he said that the real trouble was not P.A.Y.E. but P.A.Y.I.N.G., but the fact remains that, as long as the rates of taxation remain as high as they are, we cannot expect, by juggling with various systems, to remove the almost intolerable burden which the wage-earner has to bear. I followed with great interest the comments of the hon. Member on the effect of the present rates of taxation on the prospect of inflation. I think there may well be something there for the Chancellor to consider before the next Budget. He was absolutely right when he said that what the worker looks at is his "take-home" pay, and that he is not interested in the gross amount shown on his pay envelope. Although one would normally expect that a reduction in the rate of taxation, with the consequential release to the pay-packet of more money per week, would produce an inflationary tendency, I am not at all sure that there would not be a deflationary effect, because, by putting more money into the pocket of the wage-earner, we would prevent the undoubted pressure that exists for wage increases at the present time, and, instead of having a long term in-
  1002
  flationary effect, it might, in fact, finally have a deflationary effect. I would not care to dogmatise on that, but I think there is something there for the Chancellor to consider, and I think that we ought, in connection with the production campaign, around which the hon. Member's remarks revolved, to pay a tribute to the attitude of the General Council of the Trades Union Congress on this matter. In that, as in their attitude on wage increases generally, I think they have shown the greatest statesmanship in what they are doing, and that they are to be congratulated on the bold and successful line they are taking.
  I followed with interest the comments of the hon. Member when he referred to the fact that people were not willing to work longer hours for more pay, above a certain amount. There was a hiatus in his argument, because he said that the reason for that was P.A.Y.E. I do not think that is the reason at all. Surely, the position is reached with ordinary people, when they have a certain standard of life and a certain amount of money in their pockets, that they are no longer willing to go on working purely for more money, for they value their leisure above more money, and even if we were prepared to abolish the Income Tax and put all that additional money in their pockets, we should not necessarily get higher production. Otherwise, why is it that married women who have been used to going out to work in the past are not willing to go out to work now? I suggest that the reason is that their husbands, by contrast with prewar, are getting a rate of wages which enables them to maintain them and their wives at a modest standard of comfort which can be sustained without the necessity for the wife's earnings.
  If that is so, then juggling with P.A.Y.E. will not help. The hon. Member for Louth, perhaps, does not agree with me. In connection with this production campaign, while I think that some of the hon. Member's comments well deserve the consideration of the Chancellor before his next Budget, it seems to me that our main task is to replace the present incentives by some more intangible incentives than exist at the moment. There has to be a new relationship between employer and employed. There has to be a greater feeling of respon-

  1003
  sibility by the employed man for the industry and the factory in which he is working. That is one reason why I am a Socialist, because I believe that one gets that ultimate sense of responsibility in a Socialist society where a man feels that he is working for the good of the community as a whole and for the communal good which flows from his work in his own particular factory.
  Mr. Osborne: Would the hon. Gentleman say why it has not worked in the coalfields so far? I put that forward as a very serious question.
  Mr. Callaghan: It is a serious question, I agree, and I would be the last to pretend that the degree of nationalisation that has taken place in the coalfields to date has resulted in the psychological incentive that I thought would have resulted. There is no reason why we should not face that fact, and although it is early days it is no good burying one's head in the sand. The hon. Gentleman, of course, would probably differ from me, because I would say that a much higher and faster rate of socialisation would produce greater psychological incentives in the country as a whole. Indeed, when one looks at some of the countries on the Continent, I believe that to be a fact. I do not think I am wandering too far away from the subject, if I may say so, Mr. Speaker, because all the hon. Gentleman was talking about and what everything was centred around was the need to increase production. That was the whole basis of this discussion.
  I am not wedded to a system of heavy direct taxation as opposed to indirect taxation, although we on this side of the House in the past have always preached the virtues of direct taxation. But we learn by experience, and because we said it 50 years ago there is no reason why we should go on saying it now. I believe there is a very good case to be made for having a popular taxation system as well as for having a fair taxation system. The Chancellor has to consider which of his taxes will be popular despite all the classical arguments about the regressive effects of indirect taxation. What I propose to say, and where I think the hon. Member for Louth would disagree with me profoundly, is this. As we get a more fully developed Socialist society, as we
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  shall in this country, as we get more and more to the stage where men will start life equal as far as possible, and will rise by merit in the sphere in which they can offer the maximum contribution to the country's welfare, I do not think we ought necessarily to persist in a system of taxation which will tax higher remuneration at a higher rate. Indeed, in a fully developed Socialist economy, I would expect to see indirect taxation replacing direct taxation as the main source of revenue, because in a Socialist society, where men start equal and rise by merit, there is no point at all in giving them a substantial wage to reward the contribution they are making to the national economy, and then taking it away by taxation. These are ideas which, perhaps, we do not often express on this side of the House, and yet I am certain that as we move along the Socialist path, as we are doing, under a very great Chancellor of the Exchequer, we have to adjust our our ideas of taxation accordingly.
  I conclude by saying this. I am certain the hon. Gentleman the Member for Louth has performed a service in raising this subject, but I am quite unconvinced that if P.A.Y.E. were replaced in its present form by some other system at the present moment it would have the effects he desires. Indeed, while he was completely critical in his analysis of the evil effects of the present system, he did not tell us what ought to be put in its place, and until I see a better alternative to put in its place —probably he would not be able to tell us this afternoon—I remain convinced that at the present moment the P.A.Y.E. system is undoubtedly the best system in the interests of the taxpayer.
  Mr. Speaker: I might point out at this moment that I am scratching my head a good deal about this Debate, as to what is in Order and what is not. The hon. Member for South Cardiff (Mr. Callaghan), who was picking his way very carefully, said these considerations about P.A.Y.E. might be considered by the Chancellor in his next Budget. That would involve legislation, and clearly that is out of Order. I do not know whether the Financial Secretary can make any reply which does not involve legislation, but I do warn the House that I shall be very strict in pulling

  1005
  up hon. Members who do not keep to what is in Order on this occasion.
  3.21 p.m.
  Major Haughton: What you have just said, Mr. Speaker, scares me a bit at the outset. I think I would be in Order, however, if I said that I was very much impressed by and deeply interested in the contribution from the hon. Member for South Cardiff (Mr. Callaghan). A lot has been said in this House at different times, and outside it, about those who do not consider it worth while continuing work after reaching a point in their earnings where tax seems to absorb the subsequent pay. I have always been a far greater admirer of the man who went, having said he would not go, than of the man who said "I will go" and never stirred. There are a tremendous number of workpeople in the country who continue a full and effective week's work, despite anything they may think about taxation. Having listened with interest to the many sympathetic references about this subject made by the Chancellor of the Exchequer during the Budget Debate, I would ask the Financial Secretary to bear in mind sympathetically those who have continued to work despite taxation, and to think in terms of reward and encouragement rather than in terms of a bait to bring in those who remain absent from work.
  3.23 p.m.
  Mr. John Edwards: It seems to me important that we should distinguish between the effects of taxation in general, the effects of a particular system of taxation in any one year, and the effects of P.A.Y.E. I thought that the hon. Member for Louth (Mr. Osborne), who introduced this discussion this afternoon, was talking very largely about the effects of taxation as such, or the effects of the particular taxes that we have in the current year. In so far as he was dealing with those topics, and in so far as my hon. Friend the Member for South Cardiff (Mr. Callaghan) was dealing with those topics, I think I ought not to follow. Clearly, we have not yet got to the point where people pay their taxes with a smile. The important thing for us this afternoon, I think, is to ask whether the P.A.Y.E. system as such is a deterrent. In so far as P.A.Y.E. means "paying as you earn," it seems to me to be a wholly good system. The difficulties with it, as I under-
  1006
  stand it, are that it does not always work out as "paying as you earn"; it can mean "paying a considerable time after you have earned."
  I rose this afternoon to bring to the notice of the Financial Secretary one point which seems to me to be of particular importance in considering the effects on production of P.A.Y.E. When I was in my constituency recently, I had to see me a man who came on behalf of a number of employees in a large firm in Blackburn. All were married men whose wives had been working, and their assessments for 1944–45 and 1945–46 had shown that in this particular group they had under paid tax to the tune of anything between £7 or £8 up to about £25. In some of the cases the wives had already ceased working. In almost all the cases the men themselves were now earning less than they had done in the years for which the assessments had just come in, and they were faced, therefore, with lower incomes, but with a charge to be met in the forthcoming year which might be as much as 10s. a week.
  This position, as far as I could understand it, seemed to have arisen owing to the fact that the deductions from the wives' earnings were made at the rate of 6s. 6d. in the pound over the years in question; and the husband was now called upon to pay the difference between this and the standard rate which fell to be paid on a certain part of their joint income. This is a P.A.Y.E. case. It is administrative. It means that the Revenue authorities under the P.A.Y.E. system have not, so far, found a way of taking from the wife's Income Tax at a high enough rate in the pound in cases where the joint income goes beyond a certain figure. It seems to me that there is no reason why this should not recur from year to year, unless some administrative way is found of having a more accurate estimate of the tax to be paid at an earlier point in time than hitherto has been found possible. I know that the people concerned are not required to meet the under-payment at once. I know that it merely means a change in their coding, and that they pay over a period of time. But the shock that is felt by the man when he gets his assessment, his strong feeling that there is something wrong if, at this point in time, he can suddenly be asked to pay as much as £25 which he ought to have paid in the past—the shock to him,

  1007
  and the deterrent upon the wife against her going on working, is considerable.
  I would urge upon the Financial Secretary that there is a great need for this aspect of the problem to be considered. I do not know what the solution is. I am solely concerned with having an administrative arrangement which makes it possible for an adequate amount to be taken from the wife's income, rather than a system, as we have now, which makes it quite certain that the husband, when his assessment for the past year comes in, will be called upon to pay an extra sum in the current year.
  3.29 p.m
  Mr. Paget: I, for my part, feel extremely grateful to the hon. Member for Louth (Mr. Osborne) for having raised this most important subject, and, when I heard him argue his case, I found myself very largely in agreement with most of the factual criticisms he made of P.A.Y.E. as it is working out in practice. I entirely agree with him—and I do not think there can be two minds on this subject—that it is working as a brake upon production. Equally, it does tend, in one aspect, to have an inflationary effect in causing demands for increased wages. But, whilst agreeing with the hon. Gentleman that this tax is an evil, I feel that the important thing which we have to consider is whether it is a necessary evil? Because—and it really comes to putting the same thing in a slightly different way —we have to consider whether any alternative would create a yet greater evil.
  Mr. Speaker: An alternative would be completely out of Order. I am afraid that even the suggestion of an alternative is out of Order.
  Mr. Paget: I bow to your Ruling, Mr. Speaker, but what I was going to consider —I do not know if this would be out of Order—was what would happen with regard to the balance between purchasing power and available goods in the hypothetical case of that tax not operating. With great respect, I would suggest that when one is considering the operation of a tax, it would be relevant to consider what would be the actual effects on production, and so forth, if it were not operating. After all, the object of P.A.Y.E., as well as of Purchase Tax and, to a great
  1008
  extent, of rationing and various other things, is to get some sort of balance between the effective purchasing power going into people's pockets, and the goods and services which are available for them to buy. If that sort of balance does not exist, you get headlong inflation. If, instead of the balance being effected at the moment when the purchasing power is handed out, that is to say when the pay packet is handed over, it were only effected at a later date, then the very evil which this type of taxation has been introduced to avoid would have operated before the taxation became effective. Therefore I suggest that whilst we should all—in a purely hypothetical manner, Mr. Speaker—like to see no more taxation of wages yet, so long as there is taxation of wages it is no use taxing them later; they must be taxed at the point where they become effective as purchasing power.
  3.33 p.m.
  Sir Stanley Reed: I hope, in the two or three sentences I wish to say, to be able to keep within the Rules of Order. We all listened with great respect to what has been said with regard to the effect of P.A.Y.E. on production, but I think the wider issue was very trenchantly expressed by the hon. Member for South Cardiff (Mr. Callaghan). I do not think the House should forget that what we call P.A.Y.E. today is not the original proposal of Sir Kingsley Wood. Sir Kingsley Wood's original proposal was to spread the burden of direct taxation over a larger body of the community. Revenue, no doubt was important, but what he felt was even more important, was that the community as a whole should feel the effect of direct taxation. When he introduced that Budget, I warned him that unless he collected the money at the source, he would not collect it at all, and the Treasury produced unanswerable arguments that it could never be collected at the source. Then they found it could be collected at the source, and what we call P.A.Y.E., after a considerable sacrifice of revenue—I believe it amounted to 10 months' revenue—was introduced.
  At the time I thought that that was one of the greatest financial reforms in the history of Income Tax, and I think we see the result today in the very inter-

  1009
  esting question raised by the hon. Member for South Cardiff about direct and indirect taxation. I should like to assure him that had he sat in the House in the days before Income Tax was spread over the general body of income earners, and expressed the admirable sentiments he has expressed today, they would have been received with horror and dismay by his friends. We have had as a result of this a much greater appreciation of the economic and fiscal effects of direct and indirect taxation, which is wholly to the good. I would ask the Financial Secretary, and I am confident we shall have it from him that in any reply he may make, while indicating that there will be careful examination of the effects of P.A.Y.E., or to call it by its correct name, "Income Tax on the general body of income earners," he will not abandon the principle so long as Income Tax is on a high level.
  3.36 p.m.
  Mr. Diamond: Considerable courage is needed to enter the Debate at this stage, in view of the repeated warnings that we have. I trust that I shall keep in Order, because I shall not attempt to suggest an alternative. I support P.A.Y.E. wholeheartedly, and I think it is time that that was said from these benches. It is significant that the so-called representatives of the working men on the benches opposite are telling us what the working man wants and what he does not want, whereas it is common knowledge that the established representative body of the working man sincerely wants P.A.Y.E., and especially is this so when wages are falling. That is a point to which the hon. Member for Louth (Mr. Osborne) did not pay sufficient attention. I have no hesitation in saying that all this argument about deterrents to production is grossly exaggerated. People should be very careful in making statements like that, unless they have direct personal knowledge that it is so. When the hon. Member for South Cardiff (Mr. Callaghan) makes a statement, I am sure that he has personal knowledge, and is not relying on experience in the somewhat technical and rarified atmosphere of the Income Tax inspector's office.
  I can only speak from my experience in talking to the men. If it is alleged that some people do not work too well because
  1010
  they do not like paying Income Tax, I can say that as one who has practised as an accountant for many years I have found that there is not only one category of people who do not like Income Tax and they are to be found among Income Tax and Surtax payers as well. If it is alleged that people do not like to work because of the effect of P.A.Y.E., then it is the fault—is one of the glaring faults— of management. It is obligatory on the employer to explain fully the effects of P.A.Y.E. and to see that the effects are realised. It is nonsense to say, as has been suggested, that all will have to pay the same amount of tax, unless everyone is in the same taxation category, as anyone who deals with taxation knows. Knowing that the men want P.A.Y.E., and that the revenue cannot be produced in any other way, I say that we should set ourselves to encourage men to work, instead of spreading the ill-conceived gospel that P.A.Y.E. is a deterrent to production.
  3.39 p.m.
  Sir William Darling: I do not think reference has been made to one aspect of P.A.Y.E. which concerns managements. I am connected directly and indirectly with organisations which employ many thousands of people. What is felt very acutely is the introduction of a new element in the management of industry. Up to now, there was a clearly defined function as between tax collection and management. Under Pay-as-you-earn, to take a personal example, I am placed in the position of being the tax gatherer, and the tax gatherer, quite rightly, has been a detested figure throughout the ages.
  Mr. Callaghan: Quite rightly?
  Sir W. Darling: There have been many cases in which riots and revolutions have been provoked by tax collection, and when the execution of tax gatherers has been hailed by people as a step towards freedom. Now this odious business is imposed upon me—
  Mr. Speaker: I am afraid that it is under an Act of Parliament that the employer must collect the money, and to suggest that he should not collect it is, I am afraid, out of Order.
  Sir W. Darling: I concur readily in what you say, Mr. Speaker. I was intending to urge in relation to incentive to production that the use of an unpaid officer, the manager of the business, as tax collector, impedes the working of the Act of Parliament and so hinders production. If I may be allowed to develop that view by example, I would instance two employees of mine. They come before me and they say to me, "We are engaged on equal duties. We used to receive £400 a year from you. Here are our pay packets—"
  Mr. Speaker: I am afraid the hon. Member is the tax collector by law. When he suggests that he should not be the tax collector, he is suggesting something that would entail a change in the law. Therefore, it is out of Order for him to argue that.
  Sir W. Darling: Yes, Sir. My suggestion is not to change the law. I am attempting to indicate my view that the duty placed upon managers of businesses by law is a factor in disturbing the harmony of the conduct of industry, and that the odium which, wrongly perhaps, hitherto rested on the public official, is transferred to one whose primary duty is to organise and stimulate production. This consequent irritation—and there are genuine grounds for irritation—is an addition to the limitations on production. That is the relevant point. I am not asking, nor dare I, that it should be removed or modified. It may not have been anticipated that this officer appointed by the State might be involved in effects other than those originally contemplated. There is all the difference between an official demand from the Post Office for the cost of one's telephone, and a demand of that kind made by an unofficial person. The effect of P.A.Y.E. is to make a person who is not an official person an agent for the State—and it is legal and proper that it should be so—and in performing that duty, well intentioned though he is, he does what, as a loyal citizen, he would desire not to do—hampers and hinders. It is an important point to be considered by the Financial Secretary, who, no doubt, with that ingenuity he has at his command, will be able to modify if not entirely to remedy it.
  1012
  It is impossible to discuss the alternatives, but there are many which, if you would allow it, Sir, could be discussed on some later occasion. The previous Chancellor had from me, proposals which followed the lines of those made by the previous speaker, with his experience in the City, proposals which were neither undertaxation nor taxation according to weekly earnings but in excess of these proposals. I want to make the point that P.A.Y.E. might be I do not say changed, but modified on this basis—that in place of having a somewhat elaborate and costly table system, which deals with shillings and pence and odd sums which are modified from time to time, a flat sum of, say, £2 or £4 should be deducted each week.
  Mr. Speaker: I am afraid that that would require legislation, and is quite out of Order. I think that the hon. Gentleman is on very dangerous ground.
  Sir W. Darling: It is because I have seen the tables monthly and quarterly that I make the suggestion. As you know, Mr. Speaker, they are very elaborate, and what I suggest is a modification, not of the principle, but of the method of deduction. However, if a discussion of machinery is out of Order now, I must defer it to a later occasion. In more general terms, I would say that there is, at any rate, a body of opinion, amounting to proof, that this novel method of taxation has certainly caused thought and consideration to many wage earners, and perhaps its effect on those who have not yet been encouraged by the desire to serve the State, has been to limit their activities and to reduce their productive capacity. Whether, when taxation becomes universally borne and looked upon as a boon and a blessing to man, that atmosphere will change, I do not know, but I am optimistic enough to hope that it may. But there can be no question, from my experience—which ranges from engineering, detailed distribution, banking and half a dozen other activities—that, with both men and women, this unexpected and, in their opinion, oppressive taxation, levied not by the State, but through an individual whom they looked upon as their employer, has the effect of limiting their desire to earn more money for themselves in order to be taxed more highly by the State.
  3.47 p.m.
  The Financial Secretary to the Treasury (Mr. Glenvil Hall): If it were not for the fact that I am in duty bound to reply to this Debate, nothing would have dragged me to my feet in view of your Ruling, Mr. Speaker, and the fact that nearly every speaker in putting his points has trespassed on the Rules of Order. The subject we are debating is P.A.Y.E. and production. The hon. Member for Louth (Mr. Osborne) complained that the liability to pay tax, and the present method by which people had to pay it, represented a clog on production and prevented people from putting in a full week's work. Perhaps I can answer him and the points of a similar kind made by other hon. Members, by saying straight away that I, at any rate, am not going to suggest any alteration in the present method of collection, or that we should introduce legislation in any shape or form.
  A Debate of this kind is, of course, extremely interesting. All of us pay taxes of one kind or another though, since the war, the number of people who pay Income Tax has dropped. Nevertheless, it is true to say that something like 11 million to 12 million still pay Income Tax as against the four million or so who paid it before the war. Therefore, a very large majority of the people in this country are interested in the subject. The question we have to consider this evening is whether the paying of Income Tax does prevent certain sections of the people from working as hard as they would otherwise do in the legitimate and normal attempt to take home each Saturday as much as possible in their pay packet. My own view is identical with that put with such force by my hon. Friend the Member for Blackley (Mr. Diamond). It is true that there are people in all walks of life who will not work unless they feel that they are going to get every single halfpenny they can, but fortunately—and this came out very clearly during the war —the vast majority of the people have some social sense, and are willing, when the case is put to them, to work for the State as well as for themselves. If I were asked why some people today may not be working as long hours as they might, I would say that one reason is that there is very little to buy in the shops, another that they have gone through long and tragic years during the war, that they
  1014
  are tired, and that their diet, unfortunately, is not as varied as it might be. All these things combined suggest to them, in some cases, that at the moment at any rate, it is not worth while working too hard or earning more than they need to keep their home going because after all there is very little on which to spend the money.
  When the hon. Member opposite indicated that in his view P.A.Y.E. was the chief reason for the slackness which he asserted was there, I could not help thinking he must have forgotten the changes during the last year. During this last year a great deal has been done —not perhaps for the reasons he stated but for other reasons—to take the lower paid worker out of the Income Tax paying class and therefore out of P.A.Y.E. The hon. Member gave the House instances of engineers who were earning up to about £10 a week and who said it was not worth their while to work longer hours for something like £3 or £3 10s. because from £1 to 30s. of it would go in tax. That may well be, but I think that many people would deduce from that not what the hon. Member deduces but that the standard of living in this country now has so risen, that it is possible for men to feel that they have earned enough and that there is, therefore, no reason why they should exert themselves any more.
  Mr. Osborne: May I point out that the men in this case were quite willing to do the extra 15 hours? There was no slacking so far as they were concerned, but they said, "Work it out for us and tell us what we shall get net." When they were told, they said they were not going to work because of the amount they had to pay in tax.
  Mr. Glenvil Hall: I do not think that that destroys the point I was trying to put, namely, that they were already earning sufficient and, owing to the conditions now prevailing, it did not appear worth their while to earn the £2 or so extra. What the hon. Member did not explain to the House was that the position of all these men could not have been exactly similar. As was said by my hon. Friend the Member for Blackley some of them must surely have had children. They could not all have been single. If that was so, it is quite obvious that some of them at any rate would have received far more out of

  1015
  the £3 or £3 10s. earned than the amount he stated, because if he will look at the table published last April he will see that a married couple with two children and an income of £500 a year—which is roughly the figure that applies to the men he mentioned—the most they would pay would be about 1s. 9d. in the £. If any of them have a wife and three children, the most they would have had to pay would be one shilling in the pound. If they had more children than that, the chances are that they would not pay anything at all—
  Mr. Callaghan: I think the point of the hon. Member for Louth (Mr. Osborne)— and there is a lot in it—is the marginal effect on the last pound of a man's earnings. While it may be that right over the whole of the earnings for a week a man only averages 1s. 9d. in the £1; in the last hour of effort something of the order of 5s. might be deducted. I do not think that can be avoided under the present system.
  Mr. Osborne: I pointed out that the man has to put in extra effort, and that he gets less than the average return for it.
  Mr. Hall: That may be true. All I am pointing out is that, in so far as the present Government can, they have done their best to meet the case of the poorer paid workers who, owing to the fact that money had to be raised during the war, suffered relatively heavily under taxation. The Government have done their best to temper the wind to the shorn lamb. Over 2,500,000 of these people have now gone out of the Income-Tax paying class altogether. Even a single person has to earn up to nearly £4 before the tax on him approximates—I will be careful and not say in any one week—to one shilling in the pound, which, quite frankly, in these difficult times cannot be said to be penal. A married man with five children has to earn nine guineas before he pays any Income Tax at all, though it is true that when he goes above that the tax does begin to operate steeply. Whether at any time we can work out a system which will gradually tail the thing off and acclimatise individuals to it, I do not know. This is a matter at which we in the Treasury have been working for some considerable time, and if hon. Members have any suggestions they would like to
  1016
  put before the Board of Inland Revenue, I can assure them from the bottom of my heart that what they have to suggest will be very carefully and sympathetically considered.
  In the £500,000,000 which the Chancellor of the Exchequer has given by way of relief, in his two Budgets, we have made, I think, a very good beginning. At the present moment we have to raise something like £3,000,000,000 in the way of taxation. Well over £1,000,000,000 of that comes from Income Tax and Surtax— a colossal sum. No doubt as expenditure diminishes taxation will be diminished but whether direct or indirect tax should be reduced first is another matter and I am treading on delicate ground here. It would be most interesting to discuss the incidence of direct as against indirect taxation and to make suggestions as to which should take precedence for reduction. But, although I am tempted, I shall not attempt to do that. Suffice it to say that we believe that the present system, with all its faults, is an excellent one, and that with the present high rate of Income Tax it is the only possible one. The hon. Member for Blackburn (Mr. J. Edwards) has a complaint the exact opposite to that of the hon. Member for Louth. He said that people had complained to him that not enough had been taken from them by P.A.Y.E. and that they found, as the year of assessment progressed, that they still had something to make up. We cannot have it both ways, and I think most of us will agree that instead of having a yearly assessment with perhaps £20, £30, £40 or £50 to pay, it is much better to have it taken from us, I will not say painlessly because no tax is taken painlessly, but shall I say, less painfully than in the old days.
  It being Four o'clock, the Motion for the Adjournment of the House lapsed, without Question put.
  Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Bing.]
  Mr. Glenvil Hall: Therefore I would say to the hon. Gentleman that we do realise that production is essential, that it is our bounden duty, both as Members of Parliament and as the Government, to see that production is not hampered but assisted in every way, that in our view it is impossible to change the system of col-

  1017
  lection as he suggested, and it is certainly impossible to take Income Tax off entirely in order to make sure production is not damaged. We believe there are other ways of bringing home to the people of this country the essential truth that, if they desire a high standard of living, they themselves have to share in the production of goods and services and create the wealth and conditions which will provide that high standard of living. That is,
  1018
  after all, the only way. We must keep the King's Government going, and we must raise our taxes. The Government will do it in the least painful way, but I am afraid the abolition of Income Tax at any rate is neither feasible, nor would it be just.
  Question put, and agreed to.
  Adjourned accordingly at Two Minutes past Four o'Clock.

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