Sitting of 11 February 1947

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

DOUBLE TAXATION RELIEF (ANSWER TO ADDRESSES)
THE VICE-CHAMBERLAIN OF THE HOUSEHOLD (MR. MICHAEL STEWART) reported the Answer of the Counsellors of State to the Addresses, as followeth:
We Counsellors of State, to whom have been delegated certain royal functions as specified in Letters Patent under the Great Seal of the Realm dated January the 24th, 1947, have received your Addresses to His Majesty praying that the Double Taxation Relief (Taxes on Income) (South Africa) and (Estate Duty) (South Africa) Orders, 1947, be made in the form of the drafts laid before Parliament.
We will give directions in accordance with your Addresses.
Henry.
Lascelles.

PARENTS' PENSIONS (PETITION)
Mr. Collins: I beg leave to present to the House a petition signed by some100,000 members and supporters of the National League of British Parents from all parts of the United Kingdom. The Petition draws attention to the fact that parents of serving men and women in His Majesty's Forces are suffering injustice and hardship through loss of income to the home. The Petition points out further that when their sons or daughters give their lives in the country's service there is no pension to the parents except on the basis of a means test. This is contrary to the practice during the 1914–18 war when a flat rate pension plus supplementation based on loss of income to the home was awarded.
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The Petition also points out that material losses due to enemy action are compensated. Wherefore your petitioners pray that legislation shall be introduced cancelling the means test and substituting an allowance or pension for the loss sustained; and your petitioners, as in duty bound, will ever pray.
To lie upon the Table.

PARENTS' PENSIONS (PETITION)
  PRIVATE BUSINESS
    FELIXSTOWE PIER BILL
    Read a Second time, and referred to the Examiners of Petitions for Private Bills.
    LONDON COUNTY COUNCIL (GENERAL POWERS) BILL
    To be read a Second time Tomorrow.
    LONDON PASSENGER TRANSPORT BOARD BILL
    Read a Second time, and referred to the Examiners of Petitions for Private Bills.
ORAL ANSWERS TO QUESTIONS
  SCOTLAND

    HOUSING
    Lieut.-Colonel Sir Thomas Mooreasked the Secretary of State for Scotland if he proposes to adhere to the policy that local authorities shall build their permanent houses in the ration of four to let and one to sell, in view of the desire amongst returned ex-Servicemen to spend their gratuities in acquiring a home for themselves and their families.
    The Joint Under-Secretary of State for Scotland (Mr. Buchanan): The most urgent need continues to be the building of houses for letting, and the present restrictions on the building of houses by private persons for sale must therefore be maintained. Local authorities were urged in June, 1945, to give consideration to the special housing needs of Servicemen.
    Sir T. Moore: Am I to understand from that answer that the hon. Gentleman is still determined to tie himself to the antisocial housing policy of the incompetent Minister of Health?
    Mr. Buchanan: I have some difficulty in following the question about the four

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    to one ratio in Scotland. May I say, speaking from memory, that in only two districts is anything near to a four to one ratio being worked, and that in most of Scotland the local authorities have never asked for anything approaching this?

    Salmon Poaching
    Mr. Boothbyasked the Secretary of State for Scotland whether he is aware that poaching on certain rivers in Scotland has now reached such dimensions that it threatens to ruin the salmon-fishing industry and that the penalties inflicted under the poaching laws are no deterrent; and whether he proposes to bring in amending legislation.
    The Secretary of State for Scotland (Mr. Westwood): No complaints about poaching in salmon rivers have been made to my Department in recent months. Responsibility for the employment of water bailiffs for the protection of private salmon fishing rests with the owners of the fishings and with Salmon Fishery District Boards. The monetary penalties which may be imposed may be supplemented by the court by forfeiture of the catch and of the equipment used. I can hold out no prospect of early legislation.
    Mr. Boothby: Is the right hon. Gentleman aware that it is not the private owners of fishing in the rivers who are affected by this so much as the fishermen at the mouth of the river, because poaching on the scale going on is completely ruining the whole of the salmon rivers of Scotland by preventing the salmon returning there? Would he look into it in the light of information I will give him?
    Mr. Westwood: I certainly will.

    Department of Agriculture Farms
    Mr. McKieasked the Secretary of State for Scotland the trading losses or profits for 1944, 1945 and 1946 on the four farms owned and run by the Department of Agriculture for Scotland at Dunragit, Wigtownshire.
    Mr. Westwood: The trading accounts for the farms at Dunragit under the management of the Department of Agriculture for Scotland show losses of approximately £4,790 for 1944 and £10,010 for 1945. During these years,
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    the enterprises suffered from various adverse factors—
    Sir T. Moore: The weather again?
    Mr. Westwood: —including several severe outbreaks of contagious mastitis which necessitated the disposal of a considerable number of cows. The position generally has now improved and the accounts for 1946 show a profit of approximately £3,310.
    Mr. McKie: May I ask the right hon. Gentleman, in view of the very serious statement he has just made—[HON. MEMBERS: "Oh"]—yes, very serious—if he will keep this matter constantly under review, and whether he will consider returning these farms to private ownership at the earliest possible moment?
    Mr. Westwood: I will certainly keep under constant review anything which comes under my administration and shall do my best to increase the profit if possible.
    Sir T. Moore: Profit?
    Commander Galbraith: May I ask whether the accounts of these farms are available so that hon. Members may study the details?
    Mr. Westwood: I shall be prepared to consider that point.
    Mr. Leslie Hale: Is my right hon. Friend aware that the House will view with great satisfaction this very successful Socialist enterprise compared with the losses which occurred under a predominantly Conservative Administration?

  BRITISH ARMY

    Short Service Commissions
    Air-Commodore Harveyasked the Secretary of State for War how many officers have been given three years' commissions under A.C.I. 837/46.
    The Secretary of State for War (Mr. Bellenger): On 15th January, 1,457 officers had applied for these commissions. Three hundred and two had been accepted, 678 rejected and 477 were still being considered.
    Air-Commodore Harvey: Is the right hon. Gentleman aware that the number of rejections has caused great disappointment among these men who are over 40 years of age, many of whom are out of work? Would he at least see that the applications which are under consideration are speeded up so that an early decision is arrived at?
    Mr. Bellenger: Yes, Sir, the examination of the applications which are still under consideration is going quite satisfactorily.
    Mr. John Lewis: Can my right hon. Friend say why it is that such a large number of men who have served in the Armed Forces and have been discharged and now wish to take short service commissions are being refused? Is there any special reason?
    Mr. Bellenger: One of the reasons is that we are having quite a large quantity of applications for short service commissions. Indeed, the numbers from our point of view are very satisfactory.

    Personal Cases
    Mr. J. H. Hareasked the Secretary of State far War why 14983788 Corporal R. Hewitt, 7th Battalion Parachute Regiment, was not granted an extension of leave when in possession of a medical certificate stating that his father was dying, but was made to embark for overseas service on 7th January.
    Mr. Bellenger: Corporal Hewitt came home on 30 days' leave on 6th November. He was given extensions for compassionate reasons which brought his leave up to a total of 61 days, expiring on 6th January. On 4th January my Department heard that his father had been discharged from hospital to his home, with the advice that he should be admitted to another institution; I understand that his family did not accept this advice and kept him at home. No medical evidence that death was imminent was supplied, and as the corporal's mother and two sisters were at home, further extension of leave would not have been justified on the information available.
    Mr. Hare: Is the right hon. Gentleman aware that Corporal Hewitt visited the War Office on 6th January with a medical certificate stating that his father was dangerously ill, and that he was referred to
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    Chesham Place, and there that afternoon he saw an officer who informed him that once his father was dead his troubles would be over? His father died on 10th January. The corporal was recalled from Toulon on 12th January, but did not arrive until the 14th, too late for the funeral. In view of these facts, would the right hon. Gentleman see that the War Office deal with these matters in a more humane manner?
    Mr. Bellenger: The latter part of the question is totally uncalled far—[HON. MEMBERS: "Oh."]—totally uncalled for. On the facts I have given, this corporal had 61 days' leave, and I think we did take into account all the circumstances. It might interest the hon. Gentleman to know that this gentleman's own doctor was reticent about the expectation of life and stated that he would be surprised if death occurred in the near future.
    Air-Commodore Harveyasked the Secretary of State for War if the hon. and gallant Member for Macclesfield can have a reply to his letter addressed to him, dated 17th September, 1946, regarding the grave of 11266448 Gunner Ronald Salt, 171/57 Light A.A., Royal Artillery, and the wrong photograph which was sent to his widow, Mrs. C. Salt, 101, St. George's Street, Macclesfield, by the Imperial War Graves Commission on 17th August, 1946.
    Mr. Bellenger: The hon. and gallant Member will have had a letter, dated 5th February, to the effect that the matter has unfortunately not yet been cleared up. The Imperial War Graves Commission are making careful inquiries, and a letter will be sent to the hon. and gallant Member as soon as there is any definite news.
    Air-Commodore Harvey: This is a most unsatisfactory answer. This matter has been under consideration for nearly six months. The photograph which was sent to the widow was a faked photograph, and has caused great distress. Will the right hon. Gentleman look into the matter, and get a decision at an early date?
    Mr. Bellenger: I hope the hon. and gallant Member will have a talk with me afterwards. There are considerable difficulties in identifying the photograph, but what I am concerned about, and what he is concerned about, is that the headstone which was ordered is put on the right grave.
    Mr. J. Langford-Holtasked the Secretary of State for War why Lieutenant P. J. Allen, of the Worcestershire Regiment, who was placed under close arrest on 29th June, 1946, was not brought to trial until seven months later, on 6th February, 1947; and what steps he will take to see that under no circumstances do such delays occur in the future.
    Mr. Bellenger: The delay in this case was due partly to the great complexity of the case, which involved the collection of evidence from many sources in this country and overseas, and the fact that the earlier investigations gave rise to further charges, and partly to Lieutenant Allen's unwillingness, for over a month, to disclose his account, and the fact that he escaped from arrest and was not apprehended for a further month.
    Mr. Langford-Holt: Is the right hon. Gentleman aware that this officer did not break out from his arrest until three months had elapsed, during which time he had been awaiting trial? Is the right hon. Gentleman not aware that such delays as these will prejudice his appeal to deserters to return, and give themselves up?
    Mr. Bellenger: No, Sir. As a matter of fact, the deserters who are voluntarily returning are being dealt with expeditiously.
    Mr. Quintin Hogg: Can the right hon. Gentleman tell us why this officer was placed under close arrest originally, since apparently it is contrary to King's Regulations in the ordinary course?
    Mr. Bellenger: I would not like to go into the details of the 19 charges against this officer. I understood that the trial has been completed, and that he was not acquitted. I should be happy to discuss this matter privately.
    Mr. Delargy: When my right hon. Friend receives letters from Members about soldiers being unduly detained under close arrest, will he please give instructions to those who answer for him not to give answers which are a source of bewilderment to those who know anything about military law?
    Mr. Rhys Daviesasked the Secretary of State for War for what offence 97004725 Private H. J. Harrison, after arriving at Fort Darland detention barracks on 16th January, 1947, was given
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    a hot shower-bath and placed almost immediately in a punishment cell known as the ice-box, in which an electric fan built into the ceiling was switched on to produce a cold blast of air; who awarded such punishment or what authority existed for this action in the absence of any sentence or award by the commandant; what provision there is for the summary hearing and suitable punishment of offenders; whether he is aware that this man, on the same date, was stripped and dressed in uniform against his will by three sergeants; and what action he proposes to take in this matter.
    Mr. Bellenger: As the answer is rather long, I will, with permission, circulate it in the OFFICIAL REPORT.
    Mr. Davies: Bearing in mind that this man is a conscientious objector, will my right hon. Friend tell his officers that he is entitled to the protection of the law?
    Mr. Bellenger: Yes, Sir, I quite agree with my hon. Friend, but I hope that he will read my answer carefully. It disposes of a good number of the suggestions made in my hon. Friend's Question.
    Following is the answer:
    Private Harrison was admitted to the detention barracks at Fort Darland and in the usual manner taken to the shower baths to wash. After his bath he was given his uniform and refused to put it on. He was then taken to a silent cell, to avoid disturbance in case it became necessary to dress him forcibly. Here he obeyed the order to dress himself in his uniform. This room contains an electric air extractor and is heated with warm air driven by an electric fan.
    A soldier under sentence in a military detention barracks may for the sake of decency and health be forcibly dressed in uniform, provided that no more force than is necessary is used. None of the treatment that I have described constituted a punishment, and the suggestions made in the Question bear no relations to the facts. A soldier under sentence, however, who commits an offence against the rules of the detention barracks, may be remanded for the commandant next morning and, for certain offences, may be dealt with summarily.

    Divisional Celebrations, B.A.O.R.
    Mr. Skeffington-Lodgeasked the Secretary of State for War (1) whether

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    he approved the arrangements made by the general officer commanding the 53rd Division in the British zone of Germany for requisitioning, in connection with a private party, the ss. "Mainz," and for her towage to the Hüllstrung Harbour, where a specially constructed landing stage is to be erected to connect her with Düsseldorf Yacht Club; and whether, in view of the effect of these plans on German public opinion, he will have them cancelled;
    (2) whether it was with his approval that the general officer commanding the 53rd Division in the British zone of Germany recently ordered the closure of a section of the Autobahn for use as a car park and extensive alterations to be made at the yacht club at Düsseldorf, both in connection with a private party.
    Mr. H. D. Hughesasked the Secretary of State for War the expenditure of manpower, transport, food and drink, in the celebrations of the transfer of 53rd Welsh Division to 2nd Infantry Division at Düsseldorf.
    Mr. Bellenger: No prior approval was or needed to be sought from me for this private celebration of an important stage in the history of a division with a great record. There was no expenditure from public funds involved, the celebrations being paid for from the private mess funds. The ship "Mainz" was not requisitioned but was hired commercially, as was the landing stage. No section of any Autobahn was closed but a former military car park was reopened temporarily. Certain alterations that were made at the club formed part of the long-term plan to improve the amenities there, the only special provision being the erection of the usual temporary awnings.
    Mr. Skeffington-Lodge: Does the Minister not agree that the holding of this party at all was most undesirable? [HON. MEMBERS: "Why?"] In view of the conditions in which it was held.
    Mr. Bellenger: Generally speaking, I have no objection to private parties either military or civil. As far as military parties are concerned in Germany, I am certainly of the opinion that there should be no ostentation, and I think hon. Members in all parts of the House would agree with the statement I have made in that respect.
    Mr. Hughes: While I do not wish to detract from the very fine record in the war of this division, in which I had the honour to serve, will the right hon. Gentleman take further steps, in view of the last part of his final reply, to circulate to all military units in Germany instructions that there shall be no lavish display and expenditure on food and houses while the conditions of life are such as they are today?
    Mr. Bellenger: Although I have no reason to believe that such is the case, I shall certainly be only too glad to make that representation to the General Officer Commanding the Rhine Army.
    Mr. King: Can the Minister say if any Germans were deprived of accommodation which they previously possessed in the "Mainz," and if so, how many?
    Mr. Bellenger: Not arising out of this party.
    Mr. Stokes: Is my right hon. Friend aware, whatever his other information, that this affair was vulgarly advertised? Will he impress upon the occupying Force that their business is to be available but invisible, and not to induge in these Herrenvolk activities?
    Mr. Bellenger: I would ask my hon. Friend, who himself served in the Force, to try to view this matter in its right perspective. As I have said, any blatancy is to be deprecated but, on the other hand, I do not think that this celebration took in any way the form in which it has been presented in the Press, as something of an orgy.

    Banstead Hospital
    Mr. Palmerasked the Secretary of State for War if he will investigate conditions at Banstead Military Hospital.
    Mr. Bellenger: I am not aware of the need for any special investigation, but if my hon. Friend has any particular information perhaps he would send it to me.

    R.E. Draughtsmen
    Mr. Keenanasked the Secretary of State for War why men of the R.E., D.C.R.E., who had taken and completed the architectural draughtsmen Class II course of training at Chatham, in November last, were sent to the Scottish Command in Edinburgh, then to Perth, Scotland, where no Army accommodation

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    was available, then sent home on embarkation leave, after which they returned to Edinburgh and the next day were sent to Barton Stacey, Hampshire, later to be drafted overseas; and if he will prevent such journeys in future.
    Mr. Bellenger: Men who complete courses in this country cannot always be posted direct to holding units for immediate drafting overseas. While they are waiting, they are employed in their trades in units at home. In the present case there were 20 students on the course and, as there were no outstanding demands for their services overseas, they were posted to home commands for temporary employment. Two were posted to Scottish Command, and they were sent to a district headquarters. After three weeks, urgent demands were received for draughtsmen for the Far East, and the men had to be posted to Barton Stacey, which is the only R.E. drafting unit in this country.
    Mr. Keenan: Is the Minister aware that the men concerned knew they were to go overseas, and in spite of the fact that they knew it, apparently many of them were sent off on a tour around the country? I suggest that those in the Department responsible for sending the men from Chatham to Scotland, then on embarkation leave, then returning them to Scotland and then sending them to the place from which they were sent overseas, ought to be attended to.

    Marriage Allowance (Officers)
    Mr. Boyd-Carpenterasked the Secretary of State for War when he intends to make a further announcement on the payment of marriage allowances to officers of under 25 years of age.
    Mr. Lipsonasked the Secretary of State for War if the wives of married doctors under 25 years of age who are called up into the Army as officers will be eligible for marriage allowances for themselves and their children.
    Mr. Bellenger: I am not in a position to make a statement at present but I hope to do so in the near future.
    Mr. Lipson: Is the right hon. Gentleman aware that it is not fair to these men compulsorily to call them up and to make no provision for their dependants? Will he see to this without delay?
    Mr. Bellenger: I do not think that affects the decision. I think this refers to Regular officers.
    Several hon. Members rose—
    Mr. Speaker: We have been over half an hour, and we have just got through 24 Questions.

    Professor Laski (Address to Officers)
    Mr. C. S. Taylorasked the Secretary of State for War whether permission was given to Professor Laski to address Army officers and cadets at the Prince Consort's Library, Aldershot, on "The Conditions of Democratic Government" and why Press representatives were refused admission to this meeting.
    Mr. Bellenger: Professor Laski was invited by the District Commander to address officers and officer cadets at the Prince Consort's Library, Aldershot, on "The Conditions of Democratic Government," as a part of a winter study programme. Press representatives were refused admittance because these lectures are private and not open to the public.
    Mr. Taylor: Are the Press excluded from all lectures of this nature? May I also ask whether in the right hon. Gentleman's opinion Professor Laski has any special qualifications to talk about democratic government?
    Mr. Bellenger: Well, he claims to have them. [An HON. MEMBER: "He has them."] There is no doubt that he was invited by military officers to give this lecture.
    Mr. Sydney Silverman: Is my right hon. Friend aware that Professor Laski is a recognised international authority? [HON. MEMBERS: "On what?"] Does he not think that the courtesy extended to Professor Laski might be extended still further, and that he might be invited to give another lecture on the law relating to special juries?
    Brigadier Low: Can the right hon. Gentleman tell us whether facilities could be given to some man of equal, or even greater, eminence, who might hold different views on the same subject?
    Mr. Bellenger: I do not think it is my duty to interfere with the arrangements made by senior officers to invite people of authority to speak on their particular topics.
    Sir Robert Young: Is my right hon. Friend aware that the same facilities were given after the first world war as those referred to on this occasion?

    Sandhurst (Candidates)
    Mr. Wadsworthasked the Secretary of State for War if he will give information as to the number of candidates submitted to the Royal Military Academy from independent schools, direct grant schools and State controlled schools, respectively; and the number of cadetships awarded by the Royal Military Academy in the same groups.
    Mr. Bellenger: There has so far been only one examination for entrants for Sandhurst from civil life, and I have not yet got the particulars of the various types of schools from which the candidates came. I have asked the Civil Service Commissioners for these, and when I receive them I will write to the hon. Member. The numbers finally accepted for entry to Sandhurst will not be known before the end of March.
    Mr. Hogg: Will the right hon. Gentleman give us an assurance that the best candidates will be chosen, irrespective of their educational background?
    Mr. Bellenger: Yes, most assuredly.

    S.E.A.C. (Leave and Mail)
    Captain Fieldasked the Secretary of State for War the conditions governing United Kingdom leave from S.E.A.C.; and whether there is any delay, at present, in allowing this leave.
    Mr. Bellenger: A soldier in South East Asia is allowed one period of 30 days' leave during his overseas tour. We cannot, however, allot everyone a vacancy, owing to shortage of manpower and shipping, and at present the proportion of vacancies is about one in three and a half; this is an improvement on the figure of one in five which obtained until recently. In the allotment of vacancies, due consideration is given to length of overseas service and campaign service. To be eligible, men must be able to serve for at least four months overseas on return from leave, before becoming due for release or repatriation to this country.
    Captain Fieldasked the Secretary of State for War if he is aware of the statements appearing on orders of units in
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    S.E.A.C. to the effect that too much mail is sent home by men serving in the command and unless cuts are made restrictions will have to be made; and whether such statements are made with his authority.
    Mr. Bellenger: I am aware that an order was issued by the Commander-in-Chief South East Asia Land Forces, to be repeated in unit orders, stressing the importance of using light weight stationery to reduce the weight of mail carried by air, consequent upon reductions in the air services available. A warning was given that if material reductions were not effected by these measures, the compulsory use of air letter cards or restrictions in the numbers of letters written each week might become necessary. The order applied only to letters normally carried by air and other classes of mail were not affected. I am satisfied that the order was a perfectly reasonable one.

    Enlisted Boys
    Dr. Stephen Taylorasked the Secretary of State for War under what conditions a boy of 14 years of age can voluntarily enlist in the Army for 16 years' service; and whether such conditions permit of any break in that service.
    Mr. Bellenger: With regard to the first part of the Question, I would refer my hon. Friend to the reply I gave on 9th July, 1946, to my hon. and gallant Friend the Member for Dudley (Colonel Wigg), of which I am sending him a copy. Premature discharge from a voluntary engagement in the Regular Army is not at present permitted, except that enlisted boys may claim discharge by purchase within three months of enlistment.
    Dr. Taylor: Does that answer mean that it is possible for a boy of 14 years of age to enlist voluntarily for 16 years?
    Mr. Bellenger: Speaking from memory, I know that he can enlist for a certain period, which I think can be up to 12 years, but I think my hon. Friend is referring to boys' service, which is not counted in the Regular engagement.
    Mr. Rhys Davies: Do I understand that it is possible for a boy of 14 years of age to be enlisted in the British Army?
    Mr. Bellenger: Only with the permission of his parent or guardian.
    Mr. Michael Astor: Does the right hon. Gentleman think some legislation might

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    be introduced to safeguard a child aged 14—an irresponsible age—from the decisions which he might take?
    Mr. Bellenger: Speaking as a parent, I think that the biggest safeguard is the fact that the parent has to agree.
    Mr. Rankin: Will my right hon. Friend bring the age in this case into line with the new school leaving age which takes effect on 1st April?
    Dr. Taylor: Owing to the unsatisfactory nature of the reply, I beg to give notice that I shall seek to raise the matter on the Motion for the Adjournment.

    Courts Martial, West Africa
    Captain Fieldasked the Secretary of State for War how many officers and other ranks were court-martialled for offences involving money in the West African Colonies during 1941–46.
    Mr. Bellenger: I regret that the information asked for is not available in my Department.

    Qualification Pay
    Mr. J. H. Hareasked the Secretary of State for War whether he is now able to remove the discrimination regarding qualification pay that now affects officers of the R.E.M.E. compared with officers of other corps.
    Mr. Bellenger: This point is being considered with others which have arisen over qualification pay, but no decision has been reached.
    Mr. Hare: Is the right hon. Gentleman aware that I raised this point on 1st October? Four months have now elapsed and I hope that he can give some assurance that a decision will be made at an early date.
    Mr. Bellenger: Yes, Sir. I will do my best to speed up a decision.

  PRISONERS OF WAR

    Middle East and North Africa
    Mr. Dodds-Parkerasked the Secretary of State for War how many German and Italian prisoners of war, respectively, remain in the Middle East and North Africa under British control.
    Mr. Bellenger: At 31st January approximately 90,000, all of whom are German prisoners.
    Mr. Dodds-Parker: May I ask what action is being taken to repatriate these men? At what rate are they going back to Germany?
    Mr. Bellenger: I think the next Question deals with that point.
    Mr. Hogg: What is the basis on which these men are retained at all? Does it not use up manpower to guard them, and what possible right in humanity have we to keep them?
    Mr. Bellenger: They are part of the whole picture. We have a far larger number in this country. All of them are being repatriated fairly speedily.
    Mr. Godfrey Nicholson: That does not answer the Question at all. Are they performing any function in the Middle East?
    Mr. Bellenger: They are pretty fully occupied.
    Brigadier Low: What are they doing?

    Repatriation
    Mr. Stokesasked the Secretary of State for War whether he is now able to make a statement with regard to the increased rate of repatriation of prisoners of war from the Middle East.
    Mr. Bellenger: I would refer my hon. Friend to the reply I gave on 28th January to my hon. Friend the Member for Bedford (Mr. Skeffington-Lodge), of which I am sending him a copy.
    Mr. Stokes: Is my right hon. Friend aware that however good the conditions are, they must be unsatisfactory in a sub-tropical climate, and is he aware that many of these people have been separated from their families for five years or more and are badly needed as breadwinners in the British zone in Germany?
    Mr. Bellenger: Yes, Sir, I am well aware of that. In relation to the first part of my hon. Friend's question, I caused a senior staff officer to go out and examine the conditions under which they are living, and the report I received indicated that they are living in very good conditions indeed.
    Mr. Dodds-Parker: May I ask the Secretary of State whether he can give some sort of indication of the rate at which they are being repatriated? He referred me to this Question, but the answer refers to a previous one.
    Mr. Bellenger: In the reply I gave to my hon. Friend the Member for Bedford, I said that from the beginning of July the rate of repatriation will be accelerated to 5,000 a month.
    Mr. Hogg: Can the right hon. Gentleman not tell us what is the principle underlying all this? What is the sense of this policy?
    Mr. Bellenger: I do not think that arises under this Question. I was asked to give a reply as to rate of repatriation.
    Major Bruce: Can my right hon. Friend give some idea of his difficulties?
    Brigadier Low: Can the right hon. Gentleman give the House some idea of what these men are doing?
    Mr. Bellenger: They are helping in the preparation of camps in that part of the world.
    Mr. Dribergasked the Secretary of State for War if his attention has been drawn to the proposals now being discussed for the repatriation by 1st October of all German prisoners now in U.S. hands, and of all those in France who do not volunteer to remain there as free workers; and if he will consider making parallel arrangements for the repatriation of German prisoners in Great Britain.
    Mr. Bellenger: My attention has been drawn to Press reports on this subject. As regards repatriation from this country, I can add nothing to the announcement made on 12th September, 1946.
    Mr. Driberg: If there is a real prospect that the prisoners of the French and the Americans will be sent back by 1st October, will not the effect be very bad if this country lags far behind?
    Mr. Bellenger: This is only a Press report, and I am not at all sure of its accuracy.
    Mr. Driberg: Is my right hon. Friend aware that this was a very full "Times" report, based on official conversations between the French and American Governments? Has he not taken steps to ascertain whether it is accurate?
    Mr. Bellenger: I have no information on the accuracy or otherwise of the Press report. All I am concerned with is dealing with our own prisoners.
    Mr. Dribergasked the Secretary of State for War how many German prisoners were repatriated from Britain during November, December, and January; how many of these, in each month, were repatriated on compassionate grounds; how many were in categories A and B; and what percentages of A and B prisoners have now been repatriated.
    Mr. Bellenger: As the answer contains a number of figures, I will, with permission, circulate it in the OFFICIAL REPORT.
    Mr. Driberg: Can my right hon. Friend say whether the target figure is approximately 15,000 a month, and if so, whether that is intended to include the number of compassionate cases?
    Mr. Bellenger: As far as my memory serves me, 15,000 is the target with, I think, 500 compassionate cases as well. The target figure has been pretty well exceeded in the first few months.
    Following is the answer:
    The numbers repatriated were as follow:

    November

    15,429

    December

    14,236

    January

    16,932

    46,597

    No compassionate cases were repatriated in November. Fifty were repatriated in December, and 100 in January.
    The numbers in categories A and B can only be estimated, because prisoners repatriated as sick or for economic and other reasons, are not selected by political categories. The estimated numbers are:

    A

    18,227

    B

    26,122

    C unscreened

    2,245 (included in sick who are repatriated irrespective of political category).

    46.594

    Screening has not yet been completed, but approximately 82 per cent. of the A's already screened and 11 per cent. of the B's have been repatriated.
    Mr. Stokesasked the Secretary of State for War how many prisoners of war

    177
    were repatriated from Great Britain and the Middle East, respectively, during each of the two months December, 1946, and January, 1947.
    Mr. Bellenger: From the United Kingdom 14,236 in December and 16,932 in January. From the Middle East 1,510 Germans and 4,513 Austrians in December and 3,880 Germans in January.
    Mr. Stokes: How soon does my right hon. Friend expect to increase the rate to 30,000 a month, which is the rate at which the Control Commission in Germany would be glad to receive them?
    Mr. Bellenger: That is another question. I have answered the Question on the Paper.
    Major Legge-Bourke: Why is there a discrepancy between the rates of repatriation from the Middle East and from Britain?
    Mr. Bellenger: I have given the answer to that question previously. The numbers in this country are much larger than those in the Middle East, which accounts for the larger repatriation here.
    Mr. Driberg: I beg to give notice that I shall raise the whole question of repatriation of prisoners on the Motion for the Adjournment.
    Mr. David Renton rose—
    Mr. Speaker: Notice having been given that this matter is to be raised on the Motion for the Adjournment, no further question can be asked upon it.

    Earnings (Exchange Rate)
    Mr. Dribergasked the Secretary of State for War if he is aware that earnings credited to German prisoners for their work in Britain can be cashed by them, on repatriation, only at the prewar exchange rate of 13 marks to£1; and if he will make arangements to enable them to obtain at least the official occupation rate of 40 marks to £1.
    Mr. Bellenger: I would refer my hon. Friend to the reply I gave on 17th December to my hon. Friend the Member for Ipswich (Mr. Stokes) of which I am sending my hon. Friend a copy.
    Mr. Stokes: As that reply was entirely unsatisfactory, may I ask my right hon.
    178
    Friend whether this is not in fact a breach of the Geneva Convention, which insists that prisoners of war should be treated in exactly the same way as garrison troops, and if he is aware that no military officer I have met in the zone is satisfied with the present arrangements, which consist of sweating the people in this country, and swindling them over there?
    Mr. Bellenger: I would not like to answer the last part of my hon. Friend's supplementary question unless I knew who the officers were.
    Mr. Stokes: They were responsible officers.
    Mr. Renton: Does not the present system mean that the Government are making a profit? Will the right hon. Gentleman say how he justifies that profit being made?
    Mr. Bellenger: No, Sir, no profit at all is being made out of the rate of exchange.
    Mr. Driberg: Even if no profit is made, how does my right hon. Friend justify the distinction between the two rates?
    Mr. Bellenger: I think I have given the reply to that question in two previous answers.
    Mr. Godfrey Nicholson: Would it not be more courteous to the House if on these Questions, about which public opinion is so deeply moved, the right hon. Gentleman could be more specific, and not always refer to previous answers?
    Mr. Bellenger: I do not think public opinion is deeply moved on this matter.
    Mr. Stephen: Will the right hon. Gentleman not reconsider the whole matter?
    Mr. Bellenger: I do not think it is in my power to reconsider the matter, which was agreed between our Government and the German Government.
    Captain Crookshank: May I ask to what German Government the right hon. Gentleman is referring, because if there is one at the moment it has escaped most people's notice?
    Mr. Bellenger: Unfortunately the right hon. Gentleman has not had an opportunity of looking at the answer to the previous Question. This arrangement was

    179
    made between the British Government and the then German Government in relation to British prisoners of war and German prisoners of war.

    Relaxation of Restrictions
    Mr. Longdenasked the Secretary of State for War if he is aware of the deep concern held by such societies as the Birmingham Young Friends, Quakers, about the lack of facilities for leading anything approaching a normal life by German prisoners of war; and if he will make a general statement on the situation, and issue new regulations to extend the privileges of these prisoners.
    Mr. Martin Lindsayasked the Secretary of State for War, if he will extend the concessions to German prisoners of war in Britain as regards time of reporting back and distance for visits on Sundays.
    Mr. Bellenger: On 10th and 20th December I announced, in reply to Questions by hon. Members, considerable relaxations of restrictions on prisoners of war. This was an experimental measure and I am watching the results of it. I will consider making certain modifications of the instructions now issued if such action appears to be warranted.

  POLISH FORCES

    Ludford Camp (Stokers)
    Mr. Osborneasked the Secretary of State for War if he is aware that nine farm-workers are employed as stokers at Ludford aerodrome, Lincolnshire, now used as a Polish Army camp, at £5 a week, whilst Poles are unemployed to the dissatisfaction of local agricultural workers; if he will see that these men are released for their work on the farm.
    Mr. Ballenger: I would refer the hon. Member to the reply I gave him on 28th January last.
    Mr. Osborne: May I ask the Minister if he is aware that the reply gave no satisfaction at all to the farm workers who are aggrieved in this matter?

    Discipline
    Major Bramallasked the Secretary of State for War what statutory authority entitles the Polish Forces in this country,
    180
    who have not yet enlisted into the Polish Resettlement Corps or been otherwise disposed of, to try and detain members of these Forces in accordance with their own code of discipline.
    Mr. Bellenger: The Allied Forces Act, 1940.
    Mr. Wyatt: Does the right hon. Gentleman realise that the agreement which the Allied Forces Act of 1940 applied to the Polish Armed Forces was an agreement concluded with the Polish Government in London, from which recognition has been withdrawn? Therefore, the Allied Forces Act, 1940 cannot possibly apply to the present Polish Forces in this country.
    Mr. Bellenger: I have no other information to give than the information I have given in answer to the Question, but in view of my hon. Friend's doubt on this matter, I will certainly look at it again.

    Demobilisation
    Mr. Francis Noel-Bakerasked the Secretary of State for War when he expects to complete the demobilisation of the 58,000 Polish troops still in uniform in this country; by what headquarters these troops are now administered, and how many Polish staff officers and other ranks, respectively, are employed in those headquarters.
    Mr. Bellenger: The rate of discharge from the Polish Resettlement Corps depends on the rate at which members of the Corps can be absorbed into civilian life. As has previously been stated the intention is that this process should be completed in two years. The Corps is administered by the War Office through command headquarters and no Polish officers or other ranks are employed either in the War Office or at command headquarters for this purpose.
    Mr. Noel-Baker: But is my right hon. Friend aware that this Question does not refer to the Polish Resettlement Corps as such, but to those troops who have not yet got into it? This figure was given by my right hon. Friend the Minister of Labour and refers to Polish troops who have not yet entered the Resettlement Corps but are still under Polish Army discipline.
    Mr. Bellenger: In view of the way my hon. Friend put his Question, and the

    181
    number he quoted, I took it that his Question dealt with those in the Polish Resettlement Corps, but if he would like to put down another Question, I will try to give him an answer.
    Mr. Walkden: Can the right hon. Gentleman inform the House of the classification of these members of the Polish Resettlement Corps? Are they regarded as members of an Armed Force, or as prisoners available for industrial purposes in this country?
    Mr. Bellenger: In so far as they have to be kept under some discipline, they are regarded as members of an Armed Force under the War Office. As for being available for work in this country, yes, they are, if suitable work can be found for them.
    Viscount Hinchingbrooke: Is the right hon. Gentleman aware that the manpower crisis calls. for a rate of assimilation of these men in something less than two years, and is he seriously suggesting to the House that he is prepared to acquiesce in this queer policy in view of the general situation?
    Mr. Bellenger: No, I think the noble Lord has misunderstood my answer. I said that I hoped the whole of the Polish Resettlement Corps would have been disbanded or dealt with in two years, but of course the whole process of finding them occupation, either abroad or at home here, is going on all the time.
    Mr. Austin: Will my right hon. Friend give a categorical assurance that there is no ultimate intention of using these men as a foreign legion in Germany, as envisaged by the Leader of the Opposition yesterday?
    Mr. Bellenger: Yes, Sir, I can give that assurance with the very greatest ease.

    Rations
    Mr. Walkdenasked the Secretary of State for War why Poles now resident in the resettlement camps in this country are still being supplied with full Army rations, as this is preferential treatment as compared with ordinary British civilians.
    Mr. Bellenger: The Polish Resettlement Corps is part of the British Army, and its active members therefore receive rations at the scale appropriate to the British
    182
    Army. For administrative reasons it has not hitherto been found possible to issue a different scale of rations to those members of the Resettlement Corps who have been relegated to the Reserve, and who are still necessarily accommodated in Resettlement Corps camps. These men are fed in the same mess and from the same cookhouse. Families of the Poles, who mess under separate arrangements, draw a special scale of rations in which the amounts of nationally rationed foods are limited to the quantities included in the normal British civilian scale. I am, however, looking into the whole question.
    Mr. Walkden: Can my right hon. Friend tell the House why a Polish ex-Serviceman now training for Britain's industrial army should be treated differently from a British ex-Serviceman in the same category?
    Mr. Bellenger: I have done my best to answer the point which my hon. Friend put in his Question, but I will certainly look into the matter in more detail.
    Mr. Walkden: Thank you very much.

  JAPANESE WAR CRIMES
  Mr. Skeffington-Lodgeasked the Secretary of State for War how many Japanese war criminals have been tried and sentenced; and on what evidence have verdicts so far delivered been based.
  Mr. Bellenger: With regard to the first part of the Question, I would refer my hon. Friend to the reply I gave to a Question by the hon. Member for Mile End (Mr. Piratin) on 28th January. In the trials before British courts the evidence is in the form of affidavits usually taken in this country from returned prisoners of war or testimony by witnesses appearing in person at the trial or statements made by the accused on interrogation and duly proved at the trial. In many cases the accused have elected to give evidence in their own defence and have then been cross-examined.
  Mr. Skeffington-Lodge: Can the Minister assure the House that the underlings who have been charged with crimes have not been given any disproportionate punishment for the part they played in the crimes under the orders of their superior officers?
  Mr. Bellenger: I have no reason to believe that is the case.

  DISPLACED PERSONS CAMP, ITALY (MURDERS)
  Mr. Zilliacusasked the Secretary of State for War in what circumstances the Yugoslav Consul-General in Naples and the secretary of the Yugoslav military mission in Rome were beaten to death by Chetniks when visiting the D.P. camp at Poggio Reale, near Naples; for what reasons the British military authorities failed to intervene effectively to avert this double murder, in spite of being aware of the danger; and what steps have been taken to apprehend and try those responsible.
  Mr. Bellenger: I am awaiting the arrival of the proceedings of a court of inquiry. As soon as I have seen and considered these I will write to my hon. Friend.
  Mr. Zilliacus: Is my right hon. Friend aware that the overwhelming majority of the inmates of this camp are Quisling troops who fought on the side of Germany against the Allies; that the Yugoslav Camp Commander, General Miodrag Damjanovich, is a wanted war criminal; and that the failure to deliver up this war criminal, the failure to treat these men as prisoners of war, their employment as guards and, finally, the failure to maintain order and prevent this lynching, has had a very serious effect on Anglo-Yugoslav relations?
  Professor Savory: Is the right hon. Gentleman not aware that these gentlemen were informed three times over that their presence was not desired? And is it not understood that these Chetniks were naturally horrified at the thought of these men coming from Marshal Tito in view of their recollection of the judicial murder of General Mihailovich?
  Mr. Speaker: There was an inquiry into it, but hon. Gentlemen seem to be holding it here.

  ARMS STANDARDISATION (PRESS TELEGRAM)
  Mr. Zilliacusasked the Secretary of State for War whether he is aware that a U.S. news agency, on 30th October, concluded a telegram on the subject of Anglo-U.S. standardisation of arms, exchange of military information and joint defence arrangements, with a service message to the editor, giving the name of
  184
  a War Office public relations officer as a source the correspondent had consulted; and whether he has investigated this matter and will make a statement.
  Mr. Bellenger: I am aware that a message on this subject was sent with a service message that included the name of a War Office Public Relations Officer as one of a number of sources consulted. I have investigated the matter and am satisfied that the statements contained in the message on the subjects mentioned were not made by the officer in question or by anyone else in my Department, as I have so informed my hon. Friend by letter.
  Mr. Zilliacus: Is my right hon. Friend aware that the "other sources" mentioned in this telegram were authoritative military circles, as he himself said in reply to my Question on 17th December; that "authoritative circles" is a conventional phrase in journalism to describe an official source that cannot be quoted publicly; and that the private service message indicated the War Office public relations officer in question as the source named as "authoritative military circles" in the body of the despatch?
  Mr. Bellenger: No, Sir, that is not quite the correct interpretation of the matter. I have gone into this matter in close detail, and I can once again assure my hon. Friend that the authoritative sources were not in my Department.

  BUILDING MATERIALS (SHORTAGE)
  Mr. Bossomasked the Prime Minister which Department is responsible for the building industry being unable to obtain, in appropriate time, the needed cast-iron gutters, pipes, wall ties and other metal products.
  The Lord Privy Seal (Mr. Arthur Greenwood): I have been asked to reply. The Ministry of Supply is responsible for production and the Ministry of Works for distribution. The difficulties being experienced by the building industry in this field are due mainly to the inadequacy of labour in the factories and foundries. Limited quantities of substitutes for gutters and pipes are available and these should be used where possible.
  Mr. Bossom: Is the Minister aware that the absence of these articles is seriously holding up the housing programme, and at a time like this I am sure everybody would like to see that expedited as much as possible?
  Mr. Greenwood: The Ministers are aware of the problem. In the factories and foundries where these things are produced, labour shortage makes it difficult at the moment to increase the output
  Mr. Bossom: Is the Minister aware that there are controls and tolerances on certain of these articles which are unnecessary, and are carried to a ridiculous extent?
  Mr. Greenwood: If my hon. Friend will acquaint me with particulars, I will have the matter investigated.
  Mrs. Leah Manning: Is the Minister aware that if foundries were put under schemes of mechanisation, these very necessary articles could be turned out very quickly in spite of the shortage of labour?
  Mr. Greenwood: Delay in mechanisation is very largely due to shortage of material and labour.
  Mr. Vane: Could the right hon. Gentleman say what are the substitutes to which he has referred?
  Mr. Greenwood: I am not aware myself, because I am not the Minister directly responsible for production. That is a question which could properly be put to the Minister of Supply.
  Mr. Hogg: Would the Minister describe this as "chicken feed"?
  Major Legge-Bourke: How can the right hon. Gentleman say that the Minister of Works is solely responsible for distribution when, owing to the goods traffic ban in the Eastern area, at any rate, goods have been arriving late at their eventual destinations? Will he say the manner in which effort is to be made to overcome that difficulty?
  Mr. Greenwood: If there are cases of that kind and difficulties are due to transport, certainly we will have them investigated. I was asked what Department was responsible for this. There are two—one for production and the other for distribution. The Ministry of Transport and clearly the ordinary hauliers are the agents of the Ministry of Works for this purpose

  GOVERNMENT DEPARTMENTS

    University Towns
    Sir Ralph Glynasked the Chancellor of the Exchequer whether his attention has been drawn to the fact that since various Government Departments have selected university towns and cities as regional headquarters, large demands are now made on accommodation normally used by students; and whether, in view of the need to encourage the training of students in arts and science and the increasing demand in applications, both from persons who have served in the Forces and from young people leaving school, he will consider with the appropriate Ministers the urgent necessity for finding alternative accommodation for civil servants and lay down a rule that Government Departments shall not select university towns and cities as regional headquarters.
    The Chancellor of the Exchequer (Mr. Dalton): I am anxious to do all I can to help the universities, but it is not possible to lay down so rigid a rule as the hon. baronet suggests.
    Sir R. Glyn: Is the right hon. Gentleman aware of the difficulty experienced by people continuing their university courses? As long as these university centres are also selected by the Civil Service, does it not mean that the accommodation is thereby restricted and that university education cannot be given at the very time when we want it most?
    Mr. Dalton: As I have said, I am very anxious to help the universities at this stage, and I keep myself informed, I hope, as to the difficulties. There is only one case in regard to which I have had an application for assistance, and that is from Cambridge. The other regional centres are nearly all in places where there is a university—Edinburgh, Cardiff, London, Newcastle, Leeds, Nottingham, Reading, Bristol, Birmingham and Manchester. There is a university in each of those. The only case where difficulty has been reported to me is the case of Cambridge. I am looking into that with every desire to assist. The East Anglian area is such that Cambridge is the indicated spot for the centre and it is difficult to put it anywhere else.
    Mr. Wilson Harris: With a view to relieving this very serious situation, would the right hon. Gentleman consider the construction of a garden suburb on the outskirts of Cambridge for the accommodation of the Civil Service evacuees?
    Mr. Dalton: We will consider any reasonable proposal that will help with this Cambridge problem.

    Equal Pay
    Mr. Gammansasked the Chancellor of the Exchequer when he expects to announce the Government's decision regarding equal pay for men and women in the Government service.
    Mr. Dalton: I cannot yet name a date.
    Mr. Gammans: In view of the fact that the Government are now employing such a large percentage of women and intend to employ more, is it not reasonable to ask that they should set an example in this matter and come to an early decision?
    Mr. Dalton: This has been for a very long time in incubation and I think we are entitled to have a good look at it, particularly as it involves increased expenditure if this is acted upon. In view of what he said, I think the hon. Gentleman would be watchful against such a proceeding.

  NATIONAL FINANCE

    Income Tax (P.A.Y.E.)
    Mr. De la Bèreasked the Chancellor of the Exchequer whether, in order to give additional incentive to increased production throughout the country, he will now consider abolishing the system of Pay As You Earn.
    The Chancellor of the Exchequer (Mr. Dalton): No, Sir.
    Mr. De la Bère: Is the right hon. Gentleman aware that the urgent need for increased production overrides all other considerations? Is he not aware further that increased production is the greatest safeguard against inflation which the country can have? Is it that the right hon. Gentleman does not understand? I want to know.
    Mr. Dalton: The hon. Gentleman has been kind enough to echo statements that I have frequently made myself. I am much obliged to him. The question is
    188
    whence to collect the revenue. So far as my study of the matter goes, no very great improvements can be made in the broad outline of the scheme which I inherited from my immediate predecessor, who gave great thought to the matter. This is the best way of collecting Income Tax from weekly wage earners which the wit of man has yet devised.
    Mr. De la Bère: Be very careful.
    Major Haughton: With the object of removing some of the unpopularity which attaches to P.A.Y.E., would the Chancellor consider the advisability of publishing a leaflet in simple language explaining the incidence of this tax?
    Mr. Dalton: I think it is only too well known.

    Interim Treasury Committee
    Mr. Piratinasked the Chancellor of the Exchequer the function of the Interim Treasury Committee for Polish Affairs; to what extent it performs its work in consultation with the Polish Government; what is the cost of maintaining the organisation; out of what funds it is maintained; and if he is satisfied that the number of persons employed are fully occupied in the work of the organisation.
    Mr. Dalton: Pending the passage of the Polish Resettlement Bill, this committee cares for the welfare and education of Poles in this country. It does not work in consultation with the Polish Government. The House will be asked to vote £5,250,000 on a Supplementary Estimate to cover part of this year's cost, which amounts, in all, to £7 million. The answer to the last part of the Question is "Yes, Sir."

    C.W.S. Bank
    Brigadier Mackesonasked the Chancellor of the Exchequer if, in view of the fact that the Co-operative Wholesale Bank is competing for the accounts of municipalities, he will take steps to ensure that its banking activities are entirely separated from its trading activities.
    Wing-Commander Roland Robinsonasked the Chancellor of the Exchequer whether he has yet received any response from the Co-operative Wholesale Society to his request that the society's bank should reduce its interest rates; and what action he is taking on this matter.
    Sir Waldron Smithersasked the Chancellor of the. Exchequer why the Co-operative Wholesale Society Bank is not called upon to take a quota of Treasury deposit receipts in the same way as the clearing banks; and if he will take steps to alter this practice.
    Mr. Dalton: For the present, I have nothing to add to my reply to the hon. and gallant Member for Blackpool, South (Wing-Commander Robinson) on 28th January.

    Football Pools (Taxation)
    Mr. Nallyasked the Chancellor of the Exchequer if he will give an undertaking that legislation imposing a football pools betting tax will not be introduced without provision being made at the same time for a special profits tax upon football pool promoters and the proprietors of football pool forecasting agencies.
    Mr. Dalton: My hon. Friend will not expect me to anticipate my Budget Statement.
    Mr. Nally: Is my right hon. Friend aware that that is precisely what I wanted him to do in answering this Question? Would he not agree that in view of the fact that football pool firms at the moment are making weekly profits ranging from £30—
    Mr. Speaker: I am very suspicious when I hear a question addressed, "Will he not agree?" That is not asking for information; it is asking for an opinion which, of course, is out of Order on a supplementary question.
    Mr. Nally: Could I phrase the question in this way? Is the right hon. Gentleman aware that of the 820 or so football pool firms existing in the country, there are individual firms making, at the least, £30 a week, and some may go up to £50,000 a week profit? Does he regard that as reasonable from his point of view?
    Mr. Dalton: I do not want to discuss in a supplementary what profits are reasonable and what are not.
    Mr. Nallyasked the Chancellor of the Exchequer when he proposes to introduce legislation strengthening the present machinery of taxation with the object of reducing the present extensive possibilities of Income Tax evasion by football pool
    190
    promoters, football pool forecasting agencies, amusement arcade proprietors and bookmakers.
    Mr. Dalton: Additional legislation for this purpose is not necessary.
    Mr. Nally: Would my right hon. Friend care to explain precisely what means he proposes to take to check for taxation purposes the profits of the organisations I have mentioned, and if I mention to him afterwards at least 30 different ways in which taxation can be evaded by those concerned, will he consider the matter?
    Mr. Dalton: It is the very last thing which it would be advisable for me to explain.

    Parliament Square Enlargement (Exchequer Contribution)
    Mr. Pargiterasked the Chancellor of the Exchequer whether he is now in a position to make a statement on the plans for the enlargement of Parliament Square.
    Mr. Dalton: Yes, Sir. The Middlesex County Council have offered to the Ministry of Works, for the permanent enlargement of Parliament Square, a site on the west side which they acquired in 1935. Contributions towards the cost incurred by the Middlesex County Council have been offered by the London County Council, the Westminster City Council, the Pilgrim Trust and the Chartered Surveyors Institution, and I am prepared to add, subject to the approval of Parliament, an Exchequer contribution of £100,000. This enlargement will make possible a great improvement in the layout of the roads in Parliament Square and will notably increase the beauty and dignity of the Square. In addition to the direct Exchequer contribution, there will be a 75 per cent. grant from the Minister of Transport towards the cost of the road improvement. I would like to express the Government's appreciation of the public spirit shown by the Middlesex County Council and by the other bodies who are making contributions.
    Mr. Pargiter: Is my right hon. Friend aware that this statement will be received with considerable satisfaction by the ratepayers of Middlesex, who have been carrying a very heavy financial burden for many years in preventing this site from being built on, and also by the other contributing authorities who will agree

    191
    that we have at last found a Chancellor of the Exchequer who has a more generous sense of responsibility than previous Chancellors?
    Mr. Nicholson: When the area is redesigned and laid out, can the right hon. Gentleman assure the House that the Royal Fine Art Commission will be consulted?
    Mr. Dalton: I could not say whether the Royal Fine Art Commission will be consulted. It will all be done very carefully, having regard to the amenities involved. I would not say "No," but without notice I would not say "Yes."

  AMERICAN BUNKER COAL
  Captain Crookshank(By Private Notice)asked the Minister of Fuel and Power if he will make a statement on the negotiations in progress in Washington for the purchase of American coal for bunkering purposes; what results have been achieved, and what will be the cost?
  The Minister of Fuel and Power (Mr. Shinwell): No such negotiations in Washington are in progress, but it is hoped that arrangements can be made, as a temporary measure, to revert to the system of double bunkering on the other side by the shipping companies.
  Captain Crookshank: When the Minister says that no negotiations are in progress in Washington, I take it that he means that there are no negotiations going on anywhere at all in the United States?
  Mr. Shinwell: So far as we are aware, there are no negotiations in the United States.

BUSINESS OF THE HOUSE
Mr. Eden: May I ask the acting Leader of the House what is the Business for the rest of the week, in view of the re-arrangement caused by yesterday's coal Debate?
The Lord Privy Seal (Mr. Arthur Greenwood): Yes, Sir. We propose today to consider Supplementary Estimates in Committee, beginning with the Ministry of Civil Aviation, the Ministry of Health
192
and the Ministry of Transport, and proceeding with the other Votes on the Paper. Another day will be fixed for the consideration of the Supplementary Estimates for the British Broadcasting Corporation, the Home Office and the Ministry of Education, originally announced for today. The Business fixed for tomorrow, Thursday and Friday remains unaltered. We propose to suspend the Rule today, but we hope that good progress will be made with the Supplementary Estimates and that it will not be necessary to sit unduly late.
Mr. Eden: I think we agree with the right hon. Gentleman in wishing to make progress today, but these Supplementary Estimates are important, and perhaps he will bear in mind, regarding this further day which it is proposed to allow, that as I indicated, there cannot be an undertaking on this side that it will necessarily suffice?
Mr. Greenwood: We shall see how we get on. I think that, if the House agrees, we can finish in a reasonable time, but I should hate to see the discussion on a Supplementary Estimate broken off at ten o'clock and then have to start it all over again next day. If there is good will on both sides, we can get through.
Wing-Commander Shackleton: May I ask the acting Leader of the House, if he will consider representations which have been made for the suspension of the Rule on Thursday? The Business on that day will be the Second Reading of the Industrial Organisation Bill, which is regarded by many hon. Members on this side of the House as one of very great importance. The object of the Measure is to get greater efficiency in the private sector of industry, and many hon. Members would like to speak on it.
Mr. Greenwood: I am bound to say that we have looked into this matter carefully and have reached the conclusion that it would not be fitting to suspend the Rule as suggested. It would, I think, be stretching the normal practice of the House. If there was a very strong body of opinion, especially among the Opposition, in favour of it, we should naturally, being in a more powerful position, give way to them, but I hardly think it is a case for a suspension of even one hour.

BUSINESS OF THE HOUSE
Motion made, and Question put,
"That the Proceedings on Government Business be exempted, at this day's Sitting,
from the provisions of the Standing Order (Sittings of the House)."—[Mr. Arthur Greenwood.]
The House divided: Ayes, 272; Noes, 125.

Division No. 71.]

AYES.

[3.35 p.m.

Adams, Richard (Balham)

Ewart, R.

Mathers, G.

Adams, W. T (Hammersmith, South)

Field, Capt. W J

Medland, H. M.

Allighan, Garry

Foot, M. M

Mellish, R. J

Alpass, J H

Forman, J. C.

Messer, F

Anderson, A (Motherwell)

Fraser, T (Hamilton)

Middleton, Mrs. L.

Anderson, F (Whitehaven)

Freeman, Peter (Newport)

Millington, Wing-Comdr. E. R.

Attewell, H.C

Ganley, Mrs. C. S.

Mitchison, Maj G. R

Austin, H Lewis

George, Lady M Lloyd (Anglesey)

Montague, F

Awbery, S. S

Gitzean, A.

Moody, A S.

Ayles, W H

Glar ville, J E. (Consett)

Morgan, Dr. H. B.

Ayrton Gould, Mrs. B

Granville, E. (Eye)

Morley, R.

Bacon, Miss A

Greenwood, Rt. Hon. A, (Wakefield)

Morris, P (Swansea, W.)

Balfour, A

Greenwood, A W J. (Heywood)

Moyle, A.

Barstow, P G

Grenfell, D R

Murray, J D.

Battley, J R

Grierson, E

Nally, W.

Bechervaise, A. E

Griffiths, D. (Rother Valley)

Naylor, T E.

Belcher, J W

Griffiths, Rt. Hon. J. (Llanelly)

Neal, H (Claycross)

Bellenger, Rt Hon. F J

Gunter, R. J.

Nichol, Mrs M E (Bradford, N.)

Benson, G

Guy, W H

Nicholls, H R (Stratford)

Bing, G H C

Haire, John E. (Wycombe)

Noel-Baker, Capt F E. (Brentford)

Binns, J

Hale, Leslie

Noel-Buxton, Lady

Blenkinsop, A

Hall W G

O'Brien, T

Blyton, W R

Hamilton, Lieut. -Col. R

Orbach, M.

Boardman, H

Hannan, W (Maryhill)

Paget, R. T.

Bowden, Flg.-Offr. H. W

Henderson, A. (Kingswinford)

Paling Will T. (Dewsbury)

Bowles F G (Nuneaton)

Henderson, Joseph (Ardwick)

Parmer, A. M. F.

Braddock, Mrs E M (L'p, Exch'ge)

Herbison, Miss M

Pargiter, G. A.

Braddock, T (Mitcham)

Hicks, G.

Parkin, B. T.

Bramall, Major E A

Holman, P

Paton, Mrs. F. (Rushcliffe)

Brown, George (Belper)

Holmes, H E. (Hemsworth)

Paton, J. (Norwich)

Brown, T J (Ince)

House, G.

Pearson, A

Bruce. Maj D W T

Hoy, J

Piratin, P

Buchanan, G

Hudson, J. H. (Ealing, W.)

Poole, Major Cecil (Lichfield)

Burke, W A

Hughes, H D (W'lverh'pton, W.)

Porter, E. (Warrington)

Byers, Frank

Hutchinson, H. L (Rusholme)

Porter, G. (Leeds)

Callaghan, James

Hynd, H. (Hackney, C.)

Price, M Philips

Carmichael, James

Hynd, Rt Hon. J B (Attercliffe)

Proctor, W T

Castle. Mrs B A

Isaacs, Rt Hon. G. A.

Pryde, D. J.

Champion, A J

Janner, B

Pursey, Cmdr. H.

Chater, D

Jay, D. P T.

Randall, H E.

Chetwynd, G R

Jeger, G (Winchester)

Rankin, J

Clitherow, Dr R.

Jeger, Dr S W (St. Pancras, S.E.)

Rees-Williams, D. R.

Cobb, F A

Jones D T (Hartlepools)

Reeves, J.

Cocks, F S

Jones, J H (Bolton)

Reid, T (Swindon)

Coldrick, W

Keenan W

Rhodes, H.

Collindridge, F

Kendall, W D

Ridealgh, Mrs M.

Collins, V J

Key, C W

Robens. A

Colman Miss G M

King, E. M

Roberts, Goronwy (Caernarvonshire)

Comyns, Dr L

Kinley, J.

Roberts, W (Cumberland, N.)

Cook, T F

Kirby, B V.

Robertson, J. J. (Berwick)

Cooper, Wing-Comdr G

Lee, F (Hulme)

Rogers, G. H. R.

Corlett, Dr J

Leonard, W.

Ross, William (Kilmarnock)

Corvedale, Viscount

Levy, B W

Royle, C

Cove W G

Lewis, J. (Bolton)

Scott-Elliot, W.

Crawley, A

Lewis T (Southampton)

Segal, Dr. S

Daggar, G

Lindgren, G. S

Shackleton, Wing.-Cdr. E. A. A.

Daines. P

Lindsay, K. M (Comb'd Eng. Univ.)

Sharp, Granville

Davies, Edward (Burslem)

Lipson, D L.

Shawcross, C. N. (Widnes)

Davies, Ernest (Enfield)

Lipton, Lt, -Col. M.

Silverman, J. (Erdington)

Davies. Harold (Leek)

Longden, F.

Silverman, S. S. (Nelson)

Davies, Hadyn (St Pancras, S.W.)

Lyne A W.

Skeffington, A. M.

Davies, R J (Westhoughton)

McAllister, G.

Skeffington-Lodge, T. C

Deer, G

McEntee V La T.

Skinnard, F. W

Delargy Captain H J

McGhee, H G.

Smith, C. (Colchester)

Dobbie. W

McGovern, J

Smith, Ellis (Stoke)

Dodds. N N

Mack, J D.

Smith, S. H (Hull, S.W.)

Driberg, T E N

McKay. J (Wallsend)

Snow, Capt J. W.

Dumpleton, C W

Mackay, R. W. G (Hull, N.W.)

Solley, L. J.

Durbin, E F M

McKinlay, A S.

Sorensen, R. W.

Dye S

Maclean, N. (Govan)

Soskice, Maj. Sir F.

Ede, Rt Hon J C

McLeavy, F

Sparks, J A.

Edwards, A (Middlesbrough, E.)

McNeil, Rt Hon H.

Stamford, W

Edwards, W J (Whitechapel)

Mann, Mrs J.

Steele, T

Evans, E (Lowestoft)

Manning, Mrs. L (Epping)

Stephen, C

Evans, John (Ogmore)

Marquand, H A.

Stewart, Michael (Fulham, E.)

Evans. S N (Wednesbury)

Marshall, F (Brightside)

Stokes, R. R.

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

Usborne, Henry

Wilkins, W. A.

Stress, Dr. B.

Vernon, Maj. W. F

Willey, F. T. (Sunderland)

Stubbs, A. E.

Viant, S. P.

Willey, O. G. (Cleveland)

Swingler, S.

Wadsworth, G.

Williams, W. R. (Heston)

Symonds, A. L.

Walkden, E.

Willis, E.

Taylor, H. B. (Mansfield)

Walker, G. H.

Wise, Major F. J.

Taylor, R. J. (Morpeth)

Wallace, H. W. (Walthamstow, E.)

Woodburn, A.

Taylor, Dr. S.(Barnet)

Warbey, W. N.

Woods, G. S

Thomas, D. E. (Aberdare)

Watkins, T. E.

Wyatt, W.

Thomson, Rt. Hon. G. R. (Ed'b'gh, E.)

Webb, M. (Bradford, C.)

Yates, V. F.

Thorneycroft, Harry (Clayton)

Wells, P. L. (Faversham)

Young, Sir R. (Newton)

Thurtle, E.

West, D. G.

Zilliacus, K.

Tiffany, S.

Westwood, Rt. Hon. J.

Titterington, M. F.

Whiteley, Rt. Hon. W.

TELLERS FOR THE AYES:

Tolley, L.

Wigg, Col. G. E.

Mr. Popplewell and

Turner-Samuels, M.

Wilkes, L.

Mr. Simmons.

NOES

Amory, D. Heathcoat

Harvey, Air-Comdre. A. V

Morrison, Maj. J. G. (Salisbury)

Astor, Hon. M.

Haughton, S. G.

Morrison, Rt. Hon. W. S. (Cirencester)

Baldwin, A. E.

Headlam, Lieut.-Col. Rt. Hon. Sir C.

Neven-Spence, Sir B.

Barlow, Sir J.

Hinchingbrooke, Viscount

Nicholson, G.

Beechman, N. A.

Hogg, Hon. Q.

Noble, Comdr. A. H. P.

Birch, Nigel

Hollis, M. C.

Nutting, Anthony

Boothby, R.

Hope, Lord J.

Orr-Ewing, I. L.

Bossom, A. C.

Howard, Hon. A.

Osborne, C.

Bower, N.

Hurd, A.

Peake, Rt. Hon. O.

Boyd-Carpenter, J. A.

Hutchison, Col. J. R. (Glasgow, C.)

Peto, Brig. C. H. M.

Bromley-Davenport, Lt.-Col. W

Jarvis, Sir J.

Pickthorn, K.

Buchan-Hepburn, P. G. T.

Jeffreys, General Sir G.

Poole, O. B. S. (Oswestry)

Butcher, H. W.

Jennings, R.

Prescott, Stanley

Carson, E

Joynson-Hicks, Lt.-Cdr. Hon. L. W.

Prior-Palmer, Brig. O.

Challen, C.

Kingsmill, Lt.-Col. W. H

Ramsay, Maj. S.

Channon, H.

Langford-Holt, J.

Rayner, Brig. R.

Clarke, Col. R. S.

Legge-Bourke, Maj. E A. H

Reed, Sir S. (Aylesbury)

Clifton-Brown, Lt.-Col. G.

Lennox Boyd, A. T.

Reid, Rt. Hon. J. S. C. (Hillhead)

Conant, Maj. R. J. E.

Lindsay, M. (Solihull)

Renton, D.

Cooper-Key, E. M.

Linstead, H. N.

Ropner, Col. L.

Crookshank, Capt. Rt. Hon. H. F. C.

Lloyd, Maj. Guy (Renfrew, E.)

Ross, Sir R. D. (Londonderry)

Crosthwaite-Eyre, Col. O. E.

Low, Brig. A. R. W.

Sanderson, Sir F.

Cuthbert, W. N.

Lucas-Tooth, Sir H.

Savory, Prof. D. L.

Darling, Sir W. Y.

MacAndrew, Col. Sir C.

Scott, Lord W.

De la Beère, R.

Macdonald, Sir P. (I. of Wight)

Shepherd, S. (Newark)

Dodds-Parker, A. D.

Mackeson, Brig. H.R.

Shepherd, W. S. (Bucklow)

Dower, E. L. G. (Caithness)

McKie, J. H. (Galloway)

Stuart, Rt. Hon. J. (Moray)

Drayson, G. B

Maclay, Hon. J. S.

Sutcliffe, H.

Duthie, W. S.

MacLeod, J.

Taylor, C. S. (Eastbourne)

Eccles, D. M.

Macpherson, Maj. N. (Dumfries)

Thorneycroft, G. E. P. (Monmouth)

Eden, Rt. Hon. A.

Maitland, Comdr. J. W.

Thornton-Kemsley, C. N.

Elliot, Rt. Hon. Walter

Manningham-Buller, R. E.

Touche, G. C.

Fletcher, W. (Bury)

Marlowe, A. A. H.

Vane, W. M. F.

Fox, Sir G.

Marples, A. E.

Ward, Hon. G. R.

Fraser, Maj. H. C. P. (Stone)

Marsden, Capt. A.

Watt, Sir G. S. Harvie

Fyfe, Rt. Hon. Sir D. P. M.

Marshall, D. (Bodmin)

Wheatley, Colonel M. J.

Galbraith, Cmdr. T. D.

Marshall, S. H. (Sutton)

Williams, Gerald (Tonbridge)

Gammans, L. D,

Maude, J. C.

Willoughby de Eresby, Lord

Glyn, Sir R.

Medlicott, F.

York, C.

Gomme-Duncan, Col. A. G.

Mellor, Sir J.

Grant, Lady

Molson, A. H. E.

TELLERS FOR THE NOES:

Grimston, R. V.

Moore, Lt.-Col. Sir T.

Commander Agnew and

Hare, Hon. J. H. (Woodbridge)

Morris-Jones, Sir H.

Mr. Studholme.

ORDERS OF THE DAY

  SUPPLY
  Considered in Committee.
  [Mr. HUBERT BEAUMONT in the Chair]

  SUPPLY

    MINISTRY OF CIVIL AVIATION
    Motion made, and Question proposed,
    "That a Supplementary sum, not exceeding £10, be granted to His Majesty, to defray
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    the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Ministry of Civil Aviation."
    3.45 p.m.
    Mr. Lennox-Boyd: On a point of Order. Before we start this Debate, may I ask for your Ruling, Mr. Beaumont, on its scope? The Government are, I think, asking for an increased expenditure of £10. The extent is, in fact, disguised by the fact that £2,183,990, which we had hoped to spend on the purchase of aircraft, has not been spent. Had it been spent, the Supplementary

    197
    Estimate would have been for a great deal more. Does this enable us to discuss aircraft and aircraft production? We appreciate that we cannot discuss the aircraft on which the money was not spent, but are we in Order in discussing the aircraft on which other sums have been spent, some part of the current expenses towards the running of which appear under other headings? The Government are asking for a 42 per cent. and a 43 per cent. increase on the other headings, and that expenditure is for running aircraft which have been purchased. Some of us want to argue that, if we had purchased British aircraft, the running cost would have been less. I take it that that will be in Order under the other heading?
    The Deputy-Chairman: It would be out of Order to discuss matters not connected with the Vote. We can only discuss the Supplementary Estimate. It will be in Order to refer to the running expenses, and, perhaps, that can be taken as a general direction.
    Sir Ronald Ross: Will it be in Order, Mr. Beaumont, to discuss the anticipated economies which reduce this Supplementary Estimate from the substantial figure of £2,184,000 to £10?
    The Deputy-Chairman: No, because we should then be discussing the saving, which would be out of Order.
    Sir Peter Macdonald: Would it be in Order, Mr. Beaumont, to discuss grants paid by the three Corporations towards Colonial feeder services, such as British West Indian Airways, in view of the block estimates as, otherwise, we are without any explanation, unless the Minister is prepared to give a full explanation of how the money is to be spent?
    The Deputy-Chairman: It will not be in Order to refer to that here. Nothing will be in Order except what is contained in the Supplementary Estimate.
    The Parliamentary Secretary to the Ministry of Civil Aviation (Mr. Lindgren): I have to ask the Committee, as has already been indicated, for a token Vote of £10 That token Vote arises from the fact that the additional expenditure required is for £2,184,000, and there are savings on the original Estimate of
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    £2,183,990. The additional expenditure arises, as will be seen from pages 46 and 47 of the Supplementary Estimate, in respect of salaries totalling £406,000. I should like here, to draw the attention of the Committee to the fact that the Ministry of Civil Aviation is not, in fact, a normal Civil Service Department. Its Civil Service administration is comparatively small, but, in so far as staffs are required for the running of a very large-scale business—operation, acquisition, equipment, the running of Government-owned airports, the provision and maintaining of systems of air traffic control, and the navigational aids necessary to ensure the safe operation of civil air services—those staffs are comparatively large, in proportion to the other staffs.
    Perhaps the Committee, in view of the interest which has been shown in Civil Service growth, might like to know the anticipated staffing position of the Ministry, as it will be on 1st April this year. So far as the Ministry staff, the secretariat and the common services of the Ministry are concerned, the total staff will number 620; for the department running the aerodromes 330, and for the technical services department 500, making a total headquarter staff of 1,450. There is, too, a very large out-station staff. First, in connection with telecommunications, traffic control and technical services, the staff amounts to 1,932; for airport management 1,118, together with an industrial staff of 1,400, making a total out-station staff of 4,450. The total staff of the Ministry will, in fact, be 5,900, but, as will have been noticed from my earlier figures, of that 5,900, only 620 are what might be termed normal Civil Service administrative department staffs.
    The second Vote for re-allocation which is required is for £45,000 in connection with meteorological services. They arise, first, from the fact that for services which have been provided by the Sudan Government, the payments for 1944 and 1945 were delayed and have been paid during the current year, but, in fact, were not included in the Estimates. They were, in fact, included in the Estimates for 1944–45, but they were not taken up, and that portion of the Vote was returnable to the Treasury. There was a further payment included in that £45,000 to the New Zealand Government relating to services which the New Zealand Government have

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    provided in connection with our South Pacific services.
    The next item is for £810,000 in connection with the deficiency grant to the British Overseas Airways Corporation. Here I should point out to the Committee that this is the first year of normal commercial accounting of the B.O.A.C., and in previous years there has been a considerable waiving of charges as between the Corporation and various Government Departments. Probably that waiving of charges, arose from services which were provided by the Air Ministry and which were used by the Corporation. In addition to this being the first full year of peace, there has been a considerable expenditure within the Corporation in connection with the development and expansion of services and the opening up of new routes.
    I will deal with the next two items together; they are £870,000 for British European Airways Corporation, and £50,000 for the British South American Airways Corporation. These were not included in the 1946–47 Estimates because at the time those Estimates were presented to the House, authority for the setting up of these two Corporations had not been given, the Civil Aviation Act not having then received the Royal Assent. The Estimate for the deficiency is now required because it arises from the operation of British European Airways Corporation since 1st August and, as the Committee will agree, there has been considerable development of the European services since the transfer of many of those services to B.E.A.C. from Transport Command and the opening up of new services by that Corporation. Much of the £870,000 deficiency arises from development costs of the route. They are a first charge. The value of those costs will be shown by reduced costs and by the revenue in the future years, and, of course, will not be repeated. In so far as the British South American Airways Corporation is concerned, as the Committee will know, it took over from British South American Airways, Ltd., on 1st August. It is the smallest of the Corporations, and its deficiency grant arises, again, from development of services and from the costs which arise in connection with those developments.
    The last item in the Supplementary Vote is one of £3,000, and, again, it arises
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    because it could not be included within the original Estimate, as the authority for the setting up of the Air Transport Advisory Council is contained in the Civil Aviation Act, 1945. This Council has not yet been set up, but my noble Friend has arrangements well in hand, and it is hoped that before the end of the financial year the Council will be in being. It is felt to be prudent, wise and correct procedure to secure the authority of Parliament for an expenditure which might be incurred during the remaining months of the financial year in connection with the setting up of the Council. As has already been indicated, the saving of £2,183,990 arises principally from the fact that, for one reason or another, expected purchases of aircraft have not been made, and there is, of course, a saving on that, together with the Ministry of Supply Charges in connection with aircraft. I, therefore, have to ask that the token Vote of £10 be agreed to.
    Mr. Lennox-Boyd: I beg to move, "That Item Class VI, Vote 16, be reduced by £5."
    The Parliamentary Secretary has asked for this further money in a speech against the brevity of which certainly no complaint can be levelled. I am much afraid that I shall have to ask the Committee to bear with me substantially longer than the hon. Gentleman has kept them, even though in normal times the task of the Government in explaining anything should take longer than the task of the critics in finding fault with it. The hon. Gentleman approached his task with vigour and drive, in part due, no doubt, to those early morning cold plunges with which the general public have been recently regaled and which the hon. Gentleman takes every day. He is a very loyal Member of the Government and, no doubt, before much time has elapsed, the country as a whole will be compelled to bathe exclusively in cold water. Perhaps the hon. Gentleman is preparing the way gently for some further statement by his right hon. Friend the Minister of Fuel and Power.
    We cannot agree to this Supplementary Estimate which has been so lightheartedly, albeit in such a friendly fashion, asked for by the hon. Gentleman. This is the first Supplementary Estimate asked for by those nationalised air lines, which we were assured were going to show

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    private operators how to do better in business than they have hitherto done and we regard it as a very important Estimate indeed. As the hon. Gentleman was at pains to show, the Government are only asking for a further expenditure of£10, but actually, of course, they are asking for, very much more. That £10, as I suggested at the start of this discussion, is hiding the fact that some £2,183,000, which this House had voted for the purchase of aircraft, to show the British flag round the world, has not, in fact, been spent. Had it been spent—and we wish it had been spent, because no better expenditure could have been devised—then the hon. Gentleman would have been obliged to come to this House and ask for a great deal more by way of deficiency payments.
    Two comments that I want to make deal with two related problems. Why is this bill, though it is disguised, so much in excess of what we were led to believe the country would be asked to pay; and why are there so many less aeroplanes bought and in the air than we understood would be the case when the main Civil Estimate was asked for some months ago? As to the query, why this bill is so much in excess of the sum originally asked for, I suppose the imagination of the average citizen in Great Britain is now blunted in financial matters by the amazingly large sums of money which are almost daily being added to our National Debt. In the period of the last few weeks, the National Debt having been increased with regard to the compulsory acquisition of electricity by £350 million, by the Town and Country Planning Bill by £300 million, three weeks ago by the Transport Bill by £1,065 million—
    The Deputy-Chairman rose —
    Mr. Lennox-Boyd: These are only illustrations.
    The Deputy-Chairman: They seem to be rather wide of the subject under discussion.
    4.0 p.m.
    Mr. Lennox-Boyd: I bow to your Ruling, Mr. Beaumont. I had not come to the end of my catalogue, but, in view of your Ruling, I bring that point to an end. When we have, been dealing with figures of this kind, by which our National Debt has been increased in the last three or four weeks, the fact that the Govern-
    202
    ment are only asking for £2 million for Civil Air Estimates by way of excess, might be regarded, I suppose, almost as a bagatelle. But it is not so regarded by those people who want to see British aviation triumph, and who realise that it will only be triumphant if it is run efficiently and economically.
    I would like to make it plain at the outset that we have no grievance against the expenditure of money on the purchase of aircraft or the opening up of new routes. If the Government came to the House and asked for money for that purpose we, after proper examination, would give our willing assent to the use of money in that way. What we complain about is that when there is a saving of over £2,000,000 on the purchase of aircraft there is at the same moment a request for an increase of 42 per cent, in the salaries, by adding more people to the staff. Increasing the salaries of the people there might no doubt be justified owing to the admirable work they are doing, but they are doing it and taking on no people at a time when there is a saving of over £2,000,000 on the purchase of aircraft. I shall deal with that in greater detail in a moment. That is the main justification for the Opposition's Motion to reduce this Vote by £5.
    It is very difficult for the average citizen to find out the exact financial position of these great Corporations. We were assured in the Committee and Second Reading Debates of the Civil Aviation Act, that these Corporations would conduct their affairs and publish their accounts according to the best commercial standards. Now, the shareholders of these Corporations are the citizens of this country. We, in this Committee, are the trustees for the shareholders, and we are entitled to know how these sums are arrived at, and whether in fact public money is being properly spent. The "Financial Times" lately summed up the difficulty in regard to corporations of this kind. They were dealing with the day when air travel in British hands becomes competitive with railway and shipping travel all over the world—a day which we want to accelerate by every means in our power. They were trying to estimate at what point it would be possible for the mass of our people, who have not yet been able to enjoy travel by air, to enjoy it—and the quicker that day comes the better for everybody. The "Financial Times" said:

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    "The assessment of future prospects is certainly not an easy matter when dealing with State corporations. In the case of the air Corporations there are no normal accounts available, as the American companies produce."
    There are no normal accounts available because of the various unknowns: free provision of equipment and supplies by the State on the one side, and the free carriage of passengers, mails and freights on the other.
    But there are also these difficulties. When we ask the Parliamentary Secretary, or when the Minister is asked in another place, for competitive and comparative figures of the running of various aircraft —as we asked on 29th January in regard to Yorks and Lancasters—we are told that it is not fair to the Corporations to have to produce estimates of that kind. Any private firm, if subjected to awkward questions from the shareholders, would certainly be obliged to give some estimate to show why a particular vehicle was being used.
    Mr. Cobb indicated dissent.
    Mr. Lennox-Boyd: I see the hon. Member shakes his head. No doubt if the company was making a profit, he would be content not to ask for details.
    Mr. Cobb: I was only thinking that the hon. Member must have been at some strange shareholders' meetings.
    Mr. Lennox-Boyd: I have only been associated with successful companies. What, in fact, do these accounts show? From the Vote submitted to Parliament, we can draw certain conclusions. An increase is asked for, in a short period of time, in salaries alone of 42 par cent Yet, at the same time £2,000,000 has not been spent on aircraft. If the Parliamentary Secretary challenges these figures later, I am prepared to justify them in detail. At the same time I say, £2,000,000 which this Committee voted for aeroplanes has not, in fact, been spent. At the same time also, we have been told that no less than 652 members of the staff of B.O.A.C. left in the three months up to 4th December. So large a turnover in employees in such a short time does represent a very heavy overhead cost, and any private firm that had to bear it, would soon find itself in difficulties. There may well be reasons why this has happened. I do not in any
    204
    way challenge the need for these changes. Some changes may have been desired by the Corporation themselves, and some by the employees. But it is a significant fact that such a huge turnover takes place in such a short time, and it does add appreciably—for training and other reasons—to the cost of running what must be a competitive undertaking.
    The next thing that emerges is this. Originally, B.O.A.C. asked for a deficiency grant of £4,000,000. Now they are asking for £810,000 more. I must remind the Committee, too, that this is the amount required in the year ending 31st March next. We are not budgeting for a long period ahead: this is for next month. It will all have gone by the end of next month. It is for expenditure already incurred. They are asking for £810,000 more. In addition, the two other Corporations are now asking for money. It is perfectly true, as the hon. Gentleman said, that up to now, they have been under the wing of B.O.A.C., who bore their expenses. I would point out, in passing, that British South American Airways Corporation—who are asking for only £50,000—are covering a route which private enterprise undertakings offered to do without a State subsidy at all. I will not develop that, but leave it with that comment at the moment. British European Airways Corporation are asking for £870,000. It is reasonable to lump those three together and compare them with what B.O.A.C., the parent of the three, asked for everybody some months ago. They are now asking for £1,730,000 more than they asked for before. That is an increase of 43 per cent.—43 per cent. on the Civil Estimates submitted first to this Committee.
    Those are very large increases. If they were accompanied by a corresponding increase in the air fleet, and if people could fly to America in British planes, nobody could complain, for we know perfectly well that this is a field in which large expenditure is necessary and desirable. But this is accompanied by a tragic decline in the expected purchases. The purchases that are being made are—as I shall show a little later, I hope, within the limits of Order—from the national prestige point of view at any rate, of the wrong type of plane. The hon. Gentleman made some reference to the waiving of charges, and I hope that when he. or

    205
    whoever it is, replies at the end, he will deal with how far the expenditure of these corporations is due to the fact that they are carrying, for nothing, V.I.P.s or priority passengers. I think those figures should be given to the hon. Members of the Committee, who are the representatives of the public, the shareholders in these great Corporations. So much for my first question: Why are we spending so much?
    That is linked with the question of production. You ruled at the start, Mr. Beaumont, that we cannot deal with money that has not been spent, and we cannot discuss the saving that have been made by not spending it. But I think we are entitled to discuss current expenditure in the period under review, which is being asked for consequent upon the purchase of other aircraft—not, of course, the capital cost of those aircraft, because that would come under Sub-head E, for which no money is being asked. But the current expenditure, running expenses, salaries, etc., for which the Government are asking, as I have shown, 42 per cent. and 43 per cent. increases on the Civil Estimates, can be discussed, for that does open up—of course within the rules of Order—the whole tragic story of the failure of this country to have British aeroplanes flying across the Atlantic, for which we would willingly grant salaries and deficiency payments to the proper corporation, in order to uphold the prestige of this country, and our eventual primacy in the air.
    Some part of these salaries and expenses is consequent on the purchase of American aircraft. In January of last year the Parliamentary Secretary's predecessor announced to the Committee the purchase of five Constellations for the Atlantic route. We are now granting salaries and deficiency payments towards the cost of those Constellations. Many of us regarded that as tragic but inevitable. We had not got the aeroplanes at that time —
    The Deputy-Chairman: I must rule that what the hon. Member is now saying is out of Order. That comes under Subhead D, and not under that which we are at present discussing.
    Mr. Lennox-Boyd: With great respect, Mr. Beaumont, surely I am entitled to deal with a deficiency grant to B.O.A.C.,
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    which deficiency grant is partly occasioned by the fact that they are running Atlantic services—and running Atlantic services with American aircraft? We would not quarrel with a deficiency grant were they running it with British aircraft. Surely, it is in Order to draw attention to the fact that we have asked for and spent public money on services which, we had hoped, would have been supplied by British aircraft?
    The Deputy-Chairman: That may be all right. It is rather difficult. I will wait and see how the hon. Gentleman proceeds.
    Mr. Lennox-Boyd: I should be much obliged to you, Mr. Beaumont, if you would do so. I do not think the Government can have any difficulty in dealing with these points, and giving us answers; and though this does not enable us to go beyond the Rules of Order, it is a matter which touches the nation very deeply, and on which some statement is, I think, very desirable. These purchases were made last January. We were told in June, in effect, by the then Parliamentary Secretary, that he hoped that there would be no more. He did not promise. He said he hoped. Then, last November we were confronted with a bill for 12 million dollars for the purchase of six Boeing cruisers, the salaries and running expenses in connection with which, it would be in Order, I think, to discuss, on this Supplementary Estimate.
    I think our attitude is, roughly this, that the Government have not got a plan, or are they being driven by the force of sudden and last-minute disappointments into making sudden and emergency purchases from other sources? If they have a plan, let us hear it. Is their plan the intention to skip the whole of this generation of aircraft construction; give up operating the Atlantic route with British aircraft for five years; concentrate on the long-term development of jet-propelled aircraft, in which we, undoubtedly, have the lead; and then, at the end of five years, is it hoped to capture a market we have surrendered for five years? That, though tragically disappointing, would, at least, be a policy. I do not defend it. But if that is the policy we ought to hear it. On the other hand, our fear is that despite the best of intentions and the best of hopes, we lack the aircraft which we had hoped would be available from British sources

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    and others. Through some muddle, the precise causes of which are argued between different Departments and the manufacturers, we have not got them and when we made last-minute purchases of American aircraft, we have to come to the Committee for the salaries and expenses of those aircraft, not as part of a plan, but because we were driven to it by unexpected disappointments.
    I shall not go into the question of the Tudor I and the Tudor II, because I know that that would be out of Order, but I think we are entitled to ask the Government where the fault lies. Does it lie with the manufacturers, or with Government Departments? I do not think it lies with the manufacturers. The whole story of British aircraft production in the war was one of tremendous achievement. In the last 10 months of last year, in fiercely competitive markets, we sold £7,500,000 worth of British aircraft exports throughout the world, while the Americans sold only £13 million worth of which many were military types rapidly passing out of existence.
    The Chairman (Major Milner): The question of the purchase of aircraft does not come under this heading of salaries, and the salaries here are not operating salaries, but the salaries of the Minister and his staff. The hon. Gentleman is out of Order.
    Mr. Lennox-Boyd: The Parliamentary Secretary referred to the fact that his Department has now become a first-class Department of State. Long may it continue so. The Department has a Boeing, and under Subhead J1 of the Vote, the salaries of the men now flying the Boeing and the Constellations are discussable. I do not see how I can contribute anything of value if I do not make this point.
    The Chairman: The question of salaries of the operators of the aircraft and the question of the purchase of aircraft are not in question at the moment. It is therefore not in Order to discuss them.
    4.15 p.m.
    Mr. Lennox-Boyd: I think, with great respect, there is a double answer to that. The hon. Gentleman told us that a Boeing has only just been purchased. We are told that it is possible that one will be delivered before this Vote is exhausted.
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    Constellations are in flight at the moment, and the salaries are, in fact, covered by this demand; and, of course, some parts of Subhead A salaries in the Ministry go towards those officers of the Department who are dealing with the purchases of these aircraft, and putting them on the routes.
    The Chairman: The point is, whether these additional sums are included in these Estimates and relate to the particular aircraft.
    Sir P. Macdonald: But is it not the fact that this very large additional Estimate is being written off against aircraft not delivered?
    The Chairman: At the proper time, it will, of course, be in Order on the main Estimate to go into the question of policy. As hon. Members know, there are a good many restrictions on the discussion of Supplementary Estimates, which do not apply where the main Estimate is concerned.
    Captain Crookshank: If there are aeroplanes, to which my hon. Friend is referring, in existence and being flown, then, in that case, the expenditure on the running of them must come in under Subhead J 1. If, on the other hand, they are not being flown, and it is only a question of whether they are to be bought, and of negotiations leading up to the buying of them, still the people who are concerned with buying them also require salaries, and they come under Subhead A. Surely, in consequence, it becomes in Order to discuss the purchasing of these planes?
    The Chairman: I am informed that the Boeing is not the property of the Government.
    Captain Crookshank: But my hon. Friend is talking about Constellations. He agreed that the Boeing is not yet the property of the Government. He was dropping that side of his argument, and concentrating on the Constellations. Surely, it is in Order to discuss this matter under Subhead A or Subhead J 1, according as to whether they are bought or not being bought?
    Air-Commodore Harvey: Would it not be the fact, in the case of American aircraft, that some money has

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    been paid on account? I cannot imagine the Americans accepting an order from this country these days without some money being paid—ten or 20 or 30 per cent.—on account. Then, in that case, is it in Order to discuss them?
    Mr. Lindgren: Perhaps I can assist the Committee. In fact, the purchase of aircraft is capital, because it arises very largely from the capital raised by the Corporation. The Vote which is now before the Committee arises in connection with operations.
    Mr. Lennox-Boyd: I accept that Ruling, of course; but one of the contentions of the British manufacturers—I could give full details, but I shall not detain the Committee long enough for that—is that if we were flying them on the Atlantic route, there would be a very appreciable saving of cost, compared with the cost of the Constellations we have already. I take it I would be in Order to go through the comparative figures of the cost of the Tudor I and its American counterpart. If the contention of the manufacturers is correct, we should see how much money we should be saving on the Vote under J1 or A. I have no intention, however, of going into the details. I want to link up the requests I have made with a plea to the Government to be more skilful than I have been in getting the consent of the Chair to assure our people that we have a policy in regard to the type of aircraft we are going to choose for the Atlantic route. I think I have made it quite plain—
    The Chairman: That is policy. Discussion of policy is not in Order.
    Mr. Lennox-Boyd: We do not feel that the manufacturers can be blamed for the tragedy that has developed, because we have clone, in fact, remarkably more in that sphere which is still left free to private enterprise. When the Government come to us and ask for large amounts for salaries and deficiency grants for B.O.A.C. and the other corporations for the running of aircraft, it is in part due to the fact that there is no central authority with power to act effectively and swiftly in the purchase of the most economical aircraft, which many of us believe should have been British aircraft. We are left completely in the dark how the aircraft have been purchased, the money for which we are asked calmly to
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    vote out of these Estimates. Who chooses them? The manufacturers say that they have no direct contact with the operators, and the operators say that they are tied by Government controls, that the Ministry of Civil Aviation orders them and the Treasury approves the orders on specifications of the Ministry of Supply, which specifications are reviewed by some sort of consultation with the users. As I have said, there is no central authority running right through.
    The Chairman: I would point out to the hon. Member that these are questions of policy, and, secondly, that the question of capital expenditure does not arise on these Estimates. I also do not think that the hon. Member is in Order with regard to the question of salaries, as I understand they are not the salaries of B.O.A.C. but the salaries of the Department.
    Mr. Lindgren: Perhaps I may be allowed to point out in so far as Subhead A is concerned, that covers the Ministerial Department. As I understand it, it was the £810,000 in Subhead J1 which included the salaries being paid to B.O.A.C.
    Lieut.-Colonel Sir Thomas Moore: Do not the salaries cover the Chairman of the Scottish Advisory Council?
    Mr. Lindgren: All such items are included in the deficiency grants under Subhead J. As I have said, Subhead A is confined entirely to the salaries in the Ministry, excluding aerodrome administration, technical aids at aerodromes, telecommunications and the rest. Operating costs are paid by the corporation, and the deficiency grant arises to pay for some of them.
    Mr. Lennox-Boyd: The Parliamentary Secretary has conceded the argument I was trying to make, that we are dealing with the salaries of those people who are flying aeroplanes, not only the salaries of the Department, but also the salaries and expenses of B.O.A.C. I find it difficult to realise how it can be out of Order to deal with the aircraft which lead to the salaries and expenses being paid. However, I think I have pretty effectively made the point I was anxious to make, namely, the entire absence of any central authority. We would willingly agree to pay a larger amount— there would have been no cavilling by the Opposition—if it

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    would lead to the purchase of British planes of the right type, but in this case we are paying large salaries to people, tied up in a mass of Governmental red tape, who are arriving at the wrong decision.
    We feel that the operators of aircraft should be able to cut through this mass of officialdom and get to the people who are making the aircraft, as in the case of the United States where the engineers of the operators are most closely in contact with those who are producing the aeroplanes. It draws attention to the fact that whatever may be the pious hopes of any Government, bureaucracy grows and increases despite every intention on the part of any Minister to cut its size. The White Paper published by the Government is a warning of the difficulties which lie ahead. It tells us that there are over 500,000 more people on non-productive work as compared with 1939. Here the Government are asking for a huge increase in salaries, at a time when they are spending £2 million less than they had intended to expend on aeroplanes. This seems to me to be a negation of all sensible planning. We are moving towards a world where, if the number of planes flying is reduced, the staff costs go up, and where any private operator seeking to show how he can do the business better, is sent to goal by Act of Parliament. We regard this as crazy economics, and we must ask the Committee to reduce the Vote.
    Mr. Beechman: We are told that large subsidies and extra payments in respect of salaries and expenses are to be paid under these Estimates. I do not dissent from the money being paid by way of subsidy or, indeed, to salaries being increased, but before we assent, we should like to be sure that the facilities under the new dispensation, when the State takes over existing air lines, will be as good as they are now. To illustrate my point, I can do no better than to mention very briefly some very disquieting news which I have just received. Up to now, there has been an air line, run by the Great Western and Southern Air Lines, between Land's End and the Scilly Isles. It has been our good fortune, when an aeroplane has been unable to fly because of fog, that the aerodrome staff have been empowered by headquarters to
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    allow the aircraft to fly at some later hour, when conditions allow.
    The Chairman: Would the hon. Member indicate to me where in the Estimates this arises?
    Mr. Beechman: I hope that I have taken off successfully, and that I shall land successfully. There are two matters which arise on the Estimates. First, there are salaries in respect of the people in the Department at Ministerial level, and. secondly, there are the salaries of personnel on the aerodromes. I want to know that the arrangements will not be so stereotyped, that we cannot have the facilities we now have, allowing aeroplanes to travel when climatic conditions permit, and that people will not be indefinitely grounded because sudden fog has come along, as happens in the parts of the country which I know so well.
    4.30 p.m.
    Colonel J. R. H. Hutchison: Civil aviation has come to be regarded as a sort of trial ground on which we can measure the capacity, efficiency, and probable success of various other nationalisation schemes. It is, therefore, of fundamental importance that we should be able to examine it and know just how it is progressing. Having been blindfolded up till now, and the bandage now having been partly lifted, the first clue we obtain is by a study of these Estimates. I think there has been some wild estimating in these accounts. Even allowing for the difficulty of estimating for a new and ambitious concern which is just starting, any commercial accountancy would have got far nearer than the Government have got in these accounts. For instance, for meteorological services they are 225 per cent. out, which seems to show the vain optimism which has been present throughout all the Government's ambitions, promises, and hopes in connection with nationalisation schemes. I see that a further sum is required for the salaries of additional staff. Rather than additional staff, we would rather see better quality in those who have been appointed. One hears curious stories of individuals, taken on by the Coal Board, getting a 60, 70 or 80 per cent. increase for doing precisely the same work as they were doing before. I should like to be satisfied that there is nothing similar to that taking place here. As I have said, the Estimates

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    are 225 per cent. out on meteorological services, but what is more curious is the fact that, while £45,000 is required for those services in the Sudan and the South Pacific, only £20,000 is required for those services everywhere else. That is an extraordinarily unbalanced state of affairs.
    Now we come to the deficiency grant. Here we find that the revised Estimate is £870,000 as against the original Estimate of nothing. Attention has more than once been drawn to the fact that shipping companies and others were prepared to run the same services for no subsidy whatever. Is not this the time to expect these concerns to make a profit if they are ever to make money? There is a constant demand for these services, and there are constant queues waiting for the limited accommodation. The travelling public is well balanced in this matter. The Parliamentary Secretary stated that over a given period 83,000 passengers were flown one way and 80,000 the other, so that there is no question of aircraft flying light one way and coming back loaded. It is alarming to find that we require this deficiency grant—and here I am referring to B.O.A.C., and not to B.E.A.C.—because we have only four aircraft flying from this country every week, as compared to 23 by the United States. I would like to ask the Parliamentary Secretary what is happening about air mail, how much we are carrying, whether we are carrying our fair share with foreign countries, and whether this air mail, which is generally reckoned to be remunerative, is being carried with satisfactory financial results?
    There is one other point, the amount of profit, or commission, being made out of the interference with chartered companies. It was stated time and time again during the Committee stage of the Civil Aviation Bill that chartered companies would be left to take their own business, that the Government-owned Corporations would keep to their own furrows, and that only where special circumstances intervened did they intend to interfere with charter company work. The then Parliamentary Secretary stated that it was not the Government's policy that the Corporations should make charter work their main job, that any charter work would be incidental to the running of regular scheduled services. The Parliamentary Secretary said that the Government did not wish, however, to
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    debar the Corporations from undertaking charter work in certain circumstances. Now I have heard that firms which, in the past, have been accustomed to going to certain owners of aircraft, and fixing up with them for the charter of aircraft, are being approached by officials of the Corporations to pass their work through the Corporations. In other words, they are becoming commission agents. One firm's reply was "No, we are satisfied with the people from whom we got our aircraft before," whereupon the official said, "We will provide you with the same aircraft, but will pass them through our agency, which will mean a commission for us." I see your eye upon me, Major Milner, but I would point out that that affects this deficiency grant, which is to take into consideration the profit or loss that has been made in the running of the Corporations. Here is a source of potential profit, and I should like to know how far a profit is being made in that way, contrary to the promises given during the Committee stage of the Measure.
    The way for these Corporations to make money, and thus reduce or avoid deficiency grants in future, is to keep the propellers turning, just as the way to make money in road transport is to keep the wheels turning. We find that the average number of flying hours per day, over a recent period, has been given as three, whereas it is well known that in well operated firms, particularly in America, the present economic flying period is something like 10 to 15 hours a day. Until some sort of jet propulsion is imported into the Corporations themselves, and they get on with flying aircraft to the maximum period possible, consonant with safety, they will not be able to make money and escape a deficiency grant. The Minister told us that last year 200 British aircraft flew 300 million passenger miles. Similar aircraft in the United States flew 1,500 million passenger miles, with the same number of aircraft. This is just another emphasis on the necessity for keeping the propellors turning, From London to Paris there are six departures a day; from New York to Washington, 60. The fare from London to Paris is £7, and from New York to Washington, £2 15s. It all links up, one the result of the other: too little flying, too high fares. I am informed that grounded aircraft in the month of Novem-

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    ber cost the Corporations £20,000 a day. I would like to know how many days' fog there were in the year? Fog is an expensive affair, and if aircrafts are grounded by fog, the deficiency is very much increased.
    The Chairman: The hon. and gallant Gentleman is going far beyond the terms of the Estimates. That question of fog does not arise in the Estimate.
    Colonel Hutchison: I appreciate the latitude which you have given me, Major Milner, but I submit that these deficiencies, which represent losses, cannot be compartmentalised. If we are to review them and see why the deficiencies have arisen, that leads to a very wide area, and an area from which loss may arise. This emphasises more than ever the efforts which we made on the Committee stage to have commercial accounts. Why should not we have interim accounts? We are presented with estimates for large deficiencies, and we are unable to compare the relative deficiencies of one corporation with another. The whole country wants to know about this. The Minister and the Government will want to know about it for their own edification. They have the greatest confidence in nationalisation; I have none. Let us put it to the proof by submitting accounts. Let the Government stop asking us to cruise about in conjecture, and to go through a course of blind flying in accountancy which these Estimates represent today.
    4.41 p.m.
    Lieut.-Colonel Sir Thomas Moore: In order, Major Milner, to avoid putting you in the unhappy position of calling me to Order, I propose to limit my remarks to a very restricted field. That field is covered by the deficiency grants to B.O.A.C. and B.E.A.C., the latter being responsible for Civil Aviation in Scotland. We have been accustomed for some time past to associate the various Ministries, or most of them, of the Government with muddle: Food, housing —and now the sordid story of the coal muddle which is still being unfolded. But it is only within the last few weeks that the "muddle stakes" have been entered by the Ministry of Civil Aviation. I propose to refer to one of the most classic cases of muddle of which any of the
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    Ministries I have mentioned have been guilty in recent times. I admit, of course, that the hon. Gentleman must have felt himself rather left out in the cold—neither notoriety nor distinction has apparently came his way, and so he was determined to rectify that unhappy situation—and I may say that he did so with highly successful results.
    As you know, Major Milner, Scotland has always been the victim of Whitehall bureaucratic interference, and having selected Scotland as the victim, Prestwick was naturally the target of their spleen.
    The Chairman: I am very sorry, but I must steel my heart. I am afraid that the question of Prestwick does not arise.
    Sir T. Moore: Prestwick now belongs to the Ministry of Civil Aviation. The Ministry of Civil Aviation have set up a British European Airways Corporation, of which Scotland has a special section, and in connection with which there is a Scottish Advisory Commission, presided over by a distinguished Scotsman. When we come to the first item—salaries—under Vote A, the salary is £2,000 a year. I feel that with all due respect, I am well within the Rules of Order in referring to this.
    The Chairman: The salaries are those of the Ministry, and not those of B.E.A.C.
    Sir T. Moore: I appreciate that. But I would point out that the Minister himself said that under the deficiency grant would come the salaries of the staffs of the Corporations and other salaries connected with the administration of civil aviation in the various sectors of the country.
    4.45 p.m.
    Mr. Lindgren: I would point out that what I did say was this: The Corporations pay these salaries, and they pay the operating costs of the aircraft. From the payment of salaries, the operation of the aircraft and the rest, arises a deficiency. There is not included in this deficiency the salary of any particular person or of any groups of persons.
    Mr. Lennox-Boyd: On a point of Order, Major Milner. Under the heading of salaries, quite apart from the salaries of the Department, are the salaries of the ground staffs of the aerodrome.
    Mr. Lindgren indicated assent.
    Mr. Lennox-Boyd: That being so, Major Milner, having noticed the almost enthusiastic assent of the hon. Gentleman, are we not entitled to discuss questions relating to the staffs of the aerodromes whose salaries we are being asked to pay?
    The Chairman: I understood that the hon. and gallant Member was discussing the operation of aircraft from Prestwick, and the question of how Prestwick was being treated.
    Sir T. Moore: I am afraid, Major Milner, that you misunderstood the purport of my argument.
    Mr. Edgar Granville: Would it not be in Order, Major Milner, to demonstrate that if Prestwick were used more than Heathrow at the present time, it would further reduce the deficiency?
    The Chairman: I have looked at the various Sections of the Acts of Parliament referred to in the Estimates, and, so far as I can see, they do not cover any matters to which reference has been made.
    Sir T. Moore: Referring to the clarifying remark made by the Minister, when he said that the ground staffs were covered by the deficiency grant that we are discussing, it is exactly with regard to the utilisation of the ground staff at Prestwick to which I wish to call the attention of the Committee.
    Mr. Lindgren: The ground crew at Prestwick are on the R.A.F. Vote because they are R.A.F. personnel.
    Mr. Butcher: On a point of Order, Major Milner. If the ground staff at Prestwick came under the heading "out stations," which appears in the original Estimates, would not my hon. and gallant Friend be in Order in referring to them?
    The Chairman: That question does not arise because Prestwick is staffed by the R.A.F., as I understand it.
    Air-Commodore Harvey: Quite recently a new commandant was appointed to the airfield at Prestwick—Group-Captain Macdonald—I hope at a good salary, but I am told that it is a very small one. He is a retired officer of the R.A.F., but, surely, he is now under the Ministry of the Parliamentary Secretary. If that is so, is not by hon. and gallant Friend in Order?
    The Chairman: If that is so, then the operations of the staff would appear to be a matter to be properly discussed.
    Mr. Lennox-Boyd: The only people concerned with these night flying appliances are the R.A.F. For reasons which are not appreciated in Scotland they have been removed. The salaries of the traffic control officers total £35,000 according to the Vote presented some time ago, and there must be some of these at Prestwick.
    Sir T. Moore: I think now that the whole position has been clarified. We are referring now to ground staffs operating at Prestwick, and, as has been pointed out, certain of the ground staff are R.A.F. personnel attached to the Ministry of Civil Aviation.
    Mr. Lindgren: No.
    Sir T. Moore: How are the financial relationships adjusted as between the Ministry of Civil Aviation and the R.A.F.? Is it an act of good faith or a kindly gesture?
    Mr. Lindgren: The Royal Air Force at Prestwick was there to do R.A.F. duties. Out of the kindness of their hearts they have helped civil operators, which duty was also practice for themselves, with, of course, the consent of the Air Ministry. They were, in fact, R.A.F. crews on R.A.F. duties and any civil duties that they did were extraneous to their Service duties.
    Air-Commodore Harvey: On a point of Order. The Parliamentary Secretary to the Ministry of Civil Aviation has referred to the R.A.F. personnel doing work out of the kindness of their hearts. It is nothing of the kind, because civil operators pay landing fees, and they get nothing without paying for it.
    Mr. Willis: Inasmuch as these operators come under the R.A.F. Estimates, surely this is out of Order?
    The Chairman: As I understand it, that is so. It has now been admitted, however, that the commandant is paid and is under the control of the Ministry of Civil Aviation.
    Mr. Lindgren: The commandant and quite a number of ground personnel of the aerodrome are, in fact, under the Ministry

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    of Civil Aviation Vote. They are controlled and paid for by the Ministry, but the hon. and gallant Member for Ayr Burghs (Sir T. Moore) was, in fact, referring to that part of the staff which was not Ministry of Civil Aviation staff but R.A.F. staff, under the control of the R.A.F. Whatever that staff did for the civil companies, was extraneous to their Service duties.
    Sir T. Moore: This is getting really complicated. How can one develop one's arguments when one is surrounded by so many inhibitions? They seem to have been devised to prevent this Debate pursuing any logical or reasonable course. As the Chairman of this Scottish Advisory Council is paid by the Ministry, and as he comes under this grant we can discuss that matter. I should like to point out that when Scotland made a national protest against the way in which it was being treated in respect of these non-mentionable R.A.F. crews, there was a sop thrown to the country. No doubt this was some time before that actually happened, but by way of a sop, Scotland was thrown an organisation known as the Scottish Advisory Council presided over by a Scot who was adequately paid. The implication when this transaction took place was that the advice of this council of Scots presided over by a Scot, would be as Holy Writ to the British European Corporation and to the Minister. Of course, the whole thing was sheer nonsense. The Advisory Council has already been relegated to the task of registering agreement with Government decisions even after those decisions have been taken. The classic case to which I should like to refer if I could, took place only a few weeks ago.
    As regards the ground staffs, while I admit there are a number of R.A.F. personnel which operated the ground control approach at Prestwick, the equipment itself was lately, or is now, in the course of being removed. I fear that what has happened in the case of Prestwick is not a very happy situation. Compared with Heathrow, Prestwick is substantially free of fog all the year round, which in conjunction with this installation, succeeded in forcing some 85 aircraft to be diverted from other less fortunate airports in Britain to Prestwick. The Minister in the hardness of his heart and with a lack of feeling for the Scots which I am sorry
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    to have to say he has demonstrated, has acquiesced in this equipment being taken away.
    Mr. Willis: On a point of Order. As the equipment to which the hon. and gallant Member refers belongs to the R.A.F., is it in Order to discuss, under this Vote, its removal by the R.A.F.?
    The Chairman: If it is a fact that this equipment belongs to the R.A.F.—
    Mr. Lindgren: That is so.
    The Chairman: —then obviously this matter cannot be discussed.
    Sir T. Moore: May I ask why this equipment had not been provided at Heathrow by the Ministry of Civil Aviation, and why, during the five years of its existence, a crew has not been trained for that airport, and why should Prestwick be denied this equipment to facilitate Heathrow?
    Mr. Lindgren: The hon. and gallant Gentleman's timetable is a little out of date when he refers to Heathrow being five years old.
    Sir T. Moore: It was planned five years ago, and is the Parliamentary Secretary to the Ministry of Civil Aviation had been in this House, he would have been very much affected by the Debates which took place with regard to Heathrow at that time five years ago, in 1942. I have made my point although I have much to say about the general muddle in which the operational side of the Ministry of Civil Aviation has been carried out. I do suggest that the Ministry has sadly let us down. We had high hopes that we had a fine future, and when the Civil Aviation Bill was going through Committee, the previous Parliamentary Secretary to the Ministry led us to entertain those hopes. He gave us so many assurances, that we almost began to believe that under nationalisation there was a future for this great industry. Now we have seen our high hopes dashed to the ground, and I can only suggest that the Minister has a change of heart, and that he gives some encouragement to the chartered services to make good the services of which he is depriving the country.
    Sir P. Macdonald: Like other hon. Members who have spoken in this Debate, I am very much bewildered at the extent of this new Estimate, and the question

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    which comes to my mind is: Why was the original Estimate so miscalculated, and what new factors have arisen to be responsible for the Minister coming to this Committee so soon after the original Estimate was passed to ask for additional sums, in one case 42 per cent. and in another 43 per cent. over the original Estimate? Surely, as has been suggested already, there is blind estimating, as well as blind flying by B.O.A.C.; and if this is the way these public Corporations and their affairs are going to be conducted it will be hard on the British public, because obviously they are not being well managed. I wish to ask one or two questions with regard to salaries. Is it for increased salaries or for additional personnel that this large sum is required? Is there a definite establishment laid down for the Corporations?
    5.0 p.m.
    Mr. Lindgren: I thought I had made it clear that Subhead A is a Ministry Vote for salaries. As far as the other Subheads are concerned, they are spread over the whole organisation of the Corporations.
    Mr. George Ward: On a point of Order, Major Milner. Does this mean that we shall be out of Order if we talk about the salaries of the three Corporations?
    The Chairman: Clearly that would be out of Order, except in so far as any proportion of those salaries falls under any of the other heads.
    Mr. Ward: May I ask the Parliamentary Secretary whether any of the £406,000 is for the staffs of the three Corporations?
    Mr. Lindgren: It is purely for salaries at the Ministry.
    Sir P. Macdonald: Is it not the case that B.O.A.C., being the parent company, is bearing some of the salary charges of the other Corporations? Are we to understand that this enormous sum is due entirely to the increase of staff at the Ministry.
    Mr. Lindgren: Subhead A, £406,000, is entirely a Ministerial Vote for the development of services within the Ministry itself.
    Mr. Lennox-Boyd: I understood the hon. Gentleman to say earlier that Subhead A includes also the salaries of men
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    working on the aerodromes, whereas he now seems to say that it includes only people in the Department dealing with the aerodromes.
    Mr. Lindgren: It includes the whole of the staff. I referred to 5,900, and all of them, with the exception of 620 within the Ministry, are included within the aerodromes division, airport management, non-industrial staff at aerodromes, etc.
    Sir P. Macdonald: I want to know on what basis the Corporations are working. Is there a definite establishment laid down for which they have to secure the approval of the Treasury as other Departments do, or are they allowed to estimate blindly? Is it a fact that the ground staff organisation throughout the three Corporations comes directly under the Ministry and not under the Corporations themselves, and that the Corporations are responsible for the operation of the aircraft only and not for the ground staff? What is the number of these ground staff? Does the figure of 4,450 cover the whole of the outside ground staff servicing aircraft? What are these people doing? Are they the servicing staffs on the aerodromes?
    Mr. Lindgren: Subhead A is in respect of increased staff within the Ministry itself. The increased staff are to deal with the acquisition, development and management of aerodromes; it includes technical staff to deal with air traffic communications, control, radar, radio stations and so on, and industrial staff to deal with the manual work on airfields, providing the various services required by the operators. This is covered by the item of £406,000. The total staff of the Ministry, as at 1st April, 1947, will be 5,900.
    Sir P. Macdonald: I thank the hon. Gentleman for that information. I want to ask whether the Ministry are working on a definite establishment or are blindly taking on people as they think they need them. If there is an establishment, is it authorised by the Treasury? This information is of vital importance if we are to know what it will cost to run the Ministry of Civil Aviation. The other day I was amazed to hear, when the Minister replied to a Question in the House, that he did not know the cost per passenger mile of a certain type of aircraft. If any private operator did not know such a thing, he would be on the

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    way to bankruptcy. If one were to ask Pan-American Airways what it costs them to run aircraft of any type per passenger mile, they could tell one to a small fraction. Evidently, the Ministry of Civil Aviation do not think that is very important. I would like also to know whether the Ministry are setting up a pensions scheme for their employees, and if so, whether any proportion of this sum is devoted to that scheme, or whether the staff is temporary?
    In regard to the deficiency grant to British South American Airways, I would like to know what subsidies they are paying to subsidiary companies, such as Colonial air lines. I was alarmed by the statement of the chairman of the British West Indian Airlines to the effect that they might have to close down, because the Government subsidy which they had been enjoying would come to an end in March, and that in the meantime they had negotiated with British South American Airways to be taken over, but could not get a decision as to whether or not that would happen. It would be a very serious matter if the British West Indian aircraft were taken off their routes. The service is vital as a link with the whole of the British West Indies, linking up with British South American Airways. I know the difficulties which this company has had in keeping going. I have assisted them by Questions in the House and by putting pressure on Ministers. They have obtained Lockheed aircraft from America, and if now they are obliged to close down, it will be nothing less than disastrous. I urge the Minister to expedite this matter and give a decision at the earliest possible moment. I am told that the Colonial Office have informed them that their subsidy will be taken off at the end of next month. This is a matter of vital importance to our West Indian Colonies. I believe there was a long standing decision that this air line organisation could not run a direct service to this country. They were prevented from doing so, and told that they could act only as a feeder service to British South American Airways. I hope we can get some answer from the Minister to the questions I have asked on this matter.
    Mr. Butcher: I rise to ask a few questions of the Parliamentary Secretary, in regard to one of the earliest matters to which the Government directed their
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    nationalising activities, namely, civil aviation. The first point to which I would call attention is under Subhead (A) relating to salaries and staff. This is not simply a question which can be dealt with by comparison between the original Estimate and the revised Estimate. It would be useful if the Committee could refer to the corresponding figures for 1945, and see how enormously the Ministry has expanded the number of its employees and the amount of money it is costing. Let us take the headquarters' figure, which the Parliamentary Secretary gave. I believe that, under the revised Estimate, there will be 620 people on the headquarters staff. In 1946, there was an Estimate of 485, and in 1945 the number was 292. The number engaged at headquarters, including the Signals Branch, has therefore more than doubled during the last two years. The expense of this item has shown a corresponding increase. The figure for 1945 was £549,000. The revised Estimate presented by the hon. Gentleman is now for £1,356,000. That is an abnormal increase for a period of two years, especially when we realise that the function of this Ministry is not to supervise the activities of a lot of wicked capitalistic undertakings; it is concerned only with assisting and co-operating with British State-owned Corporations —with whose activities I hope to deal in a moment. I cannot help feeling that the number of the civil servants is too great and that the quality is not great enough. I put to the Parliamentary Secretary this specific inquiry: In what way, and from what source are these rapidly increasing numbers of people recruited? Does he have the advantage of using the appointments branch of the Ministry of Labour?
    Mr. Lindgren: May I tell the hon. Member that 95 per cent. of the members of this staff are recruited from the R.A.F.?
    Mr. Butcher: I am most happy to learn that fact.
    Mr. Lindgren: Apart from the question of numbers, I think the hon. Member ought to withdraw his remark that these people are of poor quality. Whatever one may say about the Civil Service, we should remember that these recruits are from one of the Fighting Services, and that it is unfair to stigmatise them as of poor quality.
    5.15 p.m.
    Mr. Butcher: I absolve the hon. Gentleman from any blame in this matter. A

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    man may have most admirable qualities as a fighting officer, but we are now dealing with him as a member of the headquarters staff of the Ministry of Civil Aviation. I was asking the hon. Gentleman whether the appointments were made with the assistance of the appointments branch of the Ministry of Labour. If the hon. Gentleman has had that assistance, I am satisfied that he has taken proper steps to secure the most suitable men for the tasks that have had to be discharged. I am not attacking any Service, or any member of staff, among whom there are no doubt many admirable men.
    I turn to the question of the deficiency grants for the Corporations. I am very concerned that we should now be called upon to vote this substantial sum of money to make good these deficiencies. The money will have to be paid by the ordinary miner and agricultural worker, and many others in respect of flights overseas in which they can have no opportunity to participate. We are entitled to satisfy ourselves that the Government which is asking for these substantial sums is taking proper steps to ensure that the expenditure is restricted to the smallest possible amount. What is the position in connection with the buildings in which British Overseas Airways carry on their work? By how much is this deficiency due to the fact that the work is dispersed all over the place? Is it a fact that the deficiency would be much smaller if the Government had had the prudence and the foresight, when they were establishing the organisation, to take adequate space, so that they would not spend the time of messengers, and transport, in taking papers from one office to another? That is the sort of matter which this Committee is entitled to probe.
    Again, on the question of staff, is the Parliamentary Secretary satisfied with the methods of recruitment for the Corporation? What are the Corporation's relationships with other companies? Hon. Members who have visited New York will be aware that B.O.A.C. do not take care of their own passengers at La Guardia field, and that that matter is dealt with by Pan-American Airways. We are entitled to ask whether the deficiency would be smaller if we saved the profit which Pan-American Airways make in doing that work for B.O.A.C. Ever since I have been in the House, British aviation
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    has always been on the point of doing something. It has always had to come along and ask for assistance from this House, largely because the Government have not been able or willing—successive Governments, I make no attack upon this Government particularly—to leave matters in the hands of the commercial airline operators. We are entitled to know to what extent the deficiency has been increased by Government interference and control.
    I will not trespass on the time of the Committee much longer if I receive a satisfactory reply. as I feel sure I shall, from the hon. Gentleman the Parliamentary Secretary, but I would ask him for a little more help and assistance on the subject of head M, the Air Transport Advisory Committee. I think that the provision of £3,000 is extraordinarily extravagant. He really ought to be able to run this one Air Transport Advisory Committee for a lot less than this. I will not give him detailed estimates of how it should be done, but I would refer him to page 40 of the Supplementary Estimate, where he will see that the Ministry of Fuel and Power can run Consumers' Councils—of which I assume that there are at least two—for £1,000. If the Ministry of Fuel and Power, with their capabilities for planning of which the country had such sad evidence, can do it for £1,000, I assume that the Parliamentary Secretary and his noble Friend should be able to make a most substantial saving on the sum of £3,000 for which they ask.
    Major Bruce: I should like to ask the Parliamentary Secretary whether he can enlighten me as to whether any portion of £810,000which I see against J.1 has been expended on the provision of the temporary facilities for flying boats provided at Poole Harbour. It has been known for some years that we need a permanent marine air base, and it is quite obvious that until we get a permanent marine base expenditure will have to continue on the basis of making up deficits on revenue account as distinct from sinking money on pure capital development at Poole. I would, therefore, like to ask him, first, whether there is any increased expenditure under this head, and second, what prospects there are of any such increases being drastically reduced in future, for of course so long as these temporary facilities are made

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    use of at Poole the necessity for continuing this expenditure will arise. Recently, the Government made a tentative decision to develop a modern air base at Cliffe, near Gravesend, whereas prior to that time civil aviation opinion in this country had held the view that the marine air base should be established at Langstone Harbour. The only reason why I raise this point on the Supplementary Estimate is because I feel that this tentative decision to establish a base at Cliffe—
    The Chairman: The hon. and gallant Member is now obviously talking about policy, and that is not permissible on this Supplementary Estimate.
    Major Bruce: I am afraid I was not phrasing my speech too well, but what was endeavouring Ito discuss was the necessity of limiting, as far as possible, such increases of expenditure as are included in these Estimates for the provision of temporary facilities at Poole. With respect, I would submit that this temporary expenditure cannot possibly be reduced until in fact a decision has been made in regard to the establishment of a marine airport, and until, of course, that decision has in fact been carried out. With your permission, Major Milner, I would urge upon the Government the necessity of adopting such a course of action in regard to the establishment of a permanent base as will lead to a progressive reduction in such deficiencies upon revenue account as I believe arise in the Estimates themselves.
    Mr. Keeling: I wish to refer to Subheads J.1 and J.3—deficiency grants to the British Overseas Airways Corporation and to the British South American Airways Corporation. I am sorry I am the only Member present of the Parliamentary Delegation, which got back from West Africa last week, because I want to refer to these items in so far as they concern the proposal to transfer from the airport of Bathurst, in Gambia, to Dakar, in French West Africa. The Parliamentary Secretary said a few days ago that it was desired, as far as practicable, that British services should operate from airports in British territory, but he destroyed a great deal of the value of that pious hope by admitting that British South American Airways had already diverted their services to Dakar. I am quite sure that it is because of that diver-
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    sion that some of this extra expenditure is required, and by adding that there is no immediate intention of transferring British Overseas Airways to Dakar the hon. Gentleman makes one fear the worst. Bathurst, as hon. Members will know, is the capital of the very small colony of the Gambia, which has been of strategic value as a seaport since the 17th century and was of the greatest value as an airport in the recent war. Without it we could hardly have maintained our air routes to Egypt, because the whole of the intermediate points between Lisbon and Bathurst were in the hands of Vichy France. It may be that it will be equally valuable again. If we are to defend the Suez Canal from Kenya, as may happen —
    The Chairman: The hon. Gentleman is now discussing questions of policy and a matter upon which it is not clear that any portion of the expenditure in the Estimates was incurred.
    Mr. Keeling: I cannot think it possible that to go to Dakar, a French port, does not mean very much greater expenditure than going to Bathurst, a British port. I cannot think that the Minister could deny that this is so.
    The Chairman: The hon. Member will forgive me for saying that that is a matter on which he must satisfy me, and I am afraid he has not so far been able to do that.
    Mr. Keeling: May I remind you, Major Milner, that the Minister did say that British South American Airways had decided to go to Dakar instead of to Bathurst, and is it not prefectly clear that to create new facilities at Dakar must involve extra expenditure? If I may I will conclude with a couple of sentences, and say that quite apart from the strategic value of Bathurst there are very strong political reasons for not abandoning it, because if we neglect the Gambia as an airport it almost ceases to have any reason for being in the British Empire. To tell the people of the Gambia that we have their welfare at heart becomes then a sham.
    The Chairman: The hon. Member must not pursue that argument.
    Air-Commodore Harvey: I think many of these points of Order could have been avoided, if the Parliamentary Secretary

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    had given us more information in his original statement. I must say that when we do not know what we are discussing, because of lack of information, it makes flying in the House rather rough It is very difficult to base one's argument on points which are not clearly explained. However, I will try to behave myself, but it will not be easy, and I hope, Major Milner, that you will allow me the same latitude as you have allowed to other hon. Members. I think that the statement of accounts on page 46, asking for this extra£10, is a very "phoney" way of presenting accounts, and I cannot imagine any reputable accountant putting his name to such a statement.
    Mr. David Griffiths: Withdraw.
    Air-Commodore Harvey: I see no point in withdrawing. It is very misleading indeed to spend all this money and use it in another direction and finish up by asking for another £10. It does not look good, and is very difficult to understand.
    Mr. D. Griffiths: It is not "phoney."
    5.30 p m
    Air-Commodore Harvey: It is not signed by an accountant, and I should like to see such a signature attached to it. I turn to the deficiency grant to the Corporation and, as a partner in an air charter company, I would like to say that I appreciate the many difficulties under which the Corporation is operating. They have had many difficulties to face in extending their organisation as a whole, and they have a very good record for safety. It has one of the best records in the world in that connection. Their money has been well spent, in spite of the difficulty of not being able to spend it on equipment for ground organisation which they badly require. Furthermore, it does not cost them anything for courtesy, and in the Corporation they are extremely courteous to all passengers and have a name second to none for this service. I do think that the figures would have made a better showing had they had more aircraft On this point I hope I shall not be out of Order and I shall try to confine myself to one or two sentences.
    I have already said that I know the difficulties in connection with aircraft, hut in the case of the larger aircraft which would bring money into the Corporation I think that had decisions been taken
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    sooner, or even if the Minister would make up his mind now, regarding Tudor I's and Tudor II's, it would be in the interests of the Corporation in the long run. The Minister has in another place referred to a legacy which he took over from his predecessor. It is not for me to say whether it is a bad legacy, but if it is, he should say quite clearly whether he is going on with it or not. I am inclined to think that if the manufacturers were given time to get through the teething troubles of these new machines they would be all right, but if they are rushed, we are in for a very severe time and will lose even more money in operating them. So far as the Marathon is concerned, the one other type of aircraft which I wish to mention, I do put some blame on the Minister, because a number of the staff of the Ministry have been expending their time in dealing with the matter. I should like to quote from a letter—
    The Chairman: The question of the production of aircraft is a matter for the Ministry of Supply, as I understand it, and does not come under the present heading.
    Air-Commodore Harvey: Surely, with great respect, Major Milner, the Ministry of Supply are only acting as agents for the Ministry of Civil Aviation and the two must work together. The Ministry of Supply, even with their assistance, is not capable of producing what is required, and—
    The Chairman: The hon. and gallant Member may only discuss what is in the Estimates.
    Mr. Lennox-Boyd: Further to that point of Order, Major Milner, we were assured in another place a few days ago by the right hon. Gentleman that the sequence was that the Corporations order aircraft from the Ministry, who place an order with the Ministry of Supply who, subject to Treasury approval, pass it on to the manufacturers. If that is so, it is completely different from the sequence other Ministers have followed before. There must be some people in the headquarters staff whose salaries are covered under Subhead A, and who receive the orders from the Corporation and then submit them to the long rigmarole I have indicated. Might not this matter be discussed on the question of expense and the additional sum required.
    The Chairman: If the hon. Gentleman will look at page 147 of the Civil Estimates he will see that there is a particular section dealing with civil aircraft and associated equipment—payments in respect of research, development and production—and it is under that heading that the hon. and gallant Gentleman could discuss the matter to which he has referred.
    Air-Commodore Harvey: I will try in a different way. The Minister did say that he has several hundreds of his own personnel employed on aerodromes in connection with radio, radar, control and so on. If the aeroplanes have not been delivered, these men have little to do and the money is wasted. I should like to give one instance regarding a particular aeroplane which could have been in operation had the Minister really taken the matter in hand some 12 months sooner. It is a very short letter from the managing director of British European Airways to Mr. F. G. Miles, of Miles Aircraft. It begins "Dear Miles."
    The Chairman: The hon. and gallant Gentleman appears to be dealing directly or indirectly with the production of aircraft. If that is so, the matter does not come under any of these Supplementary Estimates and he cannot refer to it.
    Mr. Marlowe: On a point of Order. There is here a demand for a deficiency grant towards the various Corporations. Is not an hon. Member entitled to make the proposal that if we use a different type of aircraft, less money will be required?
    The Chairman: I can only say that the question of production does come under another heading, and that is the point to which the hon. and gallant Member was addressing himself.
    Air-Commodore Harvey: I bow to your Ruling, Major Milner, and I will not attempt to read the letter, but I would just mention in passing that it says that they did not want the aeroplanes in September but now they do want them.
    The Chairman: As I have pointed out, the hon. and gallant Gentleman was not entitled to say that.
    Air-Commodore Harvey: I am extremely sorry, and I will go on to my next point.
    Mr. Granville: On a point of Order. Would it be right to say that the salary of the individual responsible for writing this letter from the Ministry of Civil Aviation is covered by the Estimate we are discussing today?
    Air-Commodore Harvey: With regard to the deficiency grant, having said several pleasant things about the Corporations I propose now to criticise. Apart from any other departments in the Corporations for which the deficiency grants are required, I am told there are those which employ psychiatrists to test the reactions of passengers and so on. Is the Minister satisfied that the training is under one roof, as it were, and does not consist of three separate training organisations? Again, some of this money has been spent on the loss of staff. The Minister answered a Question in the House on 4th December last, when he stated that 652 employees of the Corporation had left in the previous three months. There must be some reason for that. Are they dissatisfied with the conditions; are they getting the right treatment? I think we are entitled to be told, because I know that good British pilots are going to the Sabena Airline in Begium, and this does have a bearing on the subject because these men could be kept on, if they had better conditions. They are receiving £1,200 a year in Belgium and pay only 10 per cent. income tax, and if that is the reason, we must give them more money to make up for the harder and harsher conditions of living in our difficult country today. I am told that others are going over to K.L.M., and we may find the Corporations in great difficulties in obtaining the staff they want if we go on like this.
    There is another point regarding the staff of airfield controllers, some of whom are very good men. To my mind, the status of the airfield controllers is not nearly high enough. They are the men who work in the control tower with enormous responsibility, controlling these large airliners, very often in conditions of fog. I do not believe that they have the salary or status to which they are entitled. I should like to see both salaries and status improved. So far as concerns the expenditure under Subhead A, I agree that the Minister does require additional money. I have always found his staff very willing and courteous, but much overworked. It is true that few of the

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    senior members have ever had their two feet off the ground, and even if they have, they have not been on the rudder bar. I would suggest that the Minister should pick his men very carefully and take them from other Ministries which are much overstaffed, such as the Ministry of Supply and the Ministry of Food, because civil aviation is a concern, in connection with which we have to "show the world." Unless the best men are running it, we are in for severe trouble.
    I turn to the next item—the meteorological services. We are asking for £45,000 of additional money. I think one of my hon. Friends was under the impression that this was the total amount required for the running of our "met." services and I should like to correct that because the cost is about £900,000, and it is money badly spent as we are going on at present.
    Only on Sunday the weather forecast in the "Sunday Times" showed how inefficient the services are. It said:
    "London, South East, East and South West England, East and West Midlands and South Wales—Fresh East wind, strong or gale at exposed places; occasional snow; very cold with temperature below freezing day and night."
    We all know that, fortunately, it started to thaw at about one o'clock that afternoon. They were completely wrong, as they usually are. I implore the Minister, in spending these large sums on his meteorological service, to overhaul the whole organisation. I realise that at the moment the meteorological service comes under the Air Ministry but to my mind that is entirely wrong. The "met." service supplies information to the air, the sea, agriculture, and so on, and should be a national service. I hope we shall have some change before very long.
    Recently, a friend of mine who is fortunate enough to have his own aeroplane wanted to fly to Paris and made use of the "met." service. This is a good example of what is happening today in this service, on which we are spending this money. He went to the control office and said he was going to fly to Paris and asked what were the alternative aerodromes to Le Bourget. The control officer and the "met." officer suggested Cormeilles. They were thinking of the Cormeilles near Le Havre, and had no idea of the existence of the aerodrome called Cormeilles near Paris. They said that if
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    he flew on instruments he might get through, but it was risky, and they advised him to go via Ostend and fly at about 1600 feet. They said that he would get through if he was lucky. My friend flew to the Channel and found a small cloud bank at 1600 feet. He went over that, and found that it was real air-commodore's weather—one could see thirty to forty miles, and it was quite good weather. That shows one how bad our "met." service is today. The practice is growing for the pilots not to ask the "met." department now, but to inquire from others of their number, who have done the trip. They thus get the information in a back-handed way.
    Our civil aviation must succeed. All of us agree that money has to be spent, if it is spent in the right way. There must be economies in certain directions, but we must spend the money where we most require it. The Socialist Party in my view thought that civil aviation would be a very easy industry to nationalise—a good bit of window-dressing—
    The Chairman: I hope the hon. and gallant Member will not pursue that topic, as it is quite out of Order.
    Air-Commodore Harvey: I bow to your Ruling, Major Milner. We must make our air lines succeed. I do not know whether we can really afford the amount of money required, in view of the difficult times ahead of us. However, we must cut our coat according to our cloth. We must concentrate on our Empire routes and see that they succeed, instead of trying to cover the whole world at once.
    5.45 p.m.
    Mr. Max Aitken: I would like to ask the Parliamentary Secretary if he can tell us the cost per passenger mile at which the three Corporations are operating. This figure is the basis of all aircraft finance, and running air lines without this figure at his finger-tips would be like trying to run a newspaper without knowing the cost of newsprint. The shareholders of such a firm would be very upset if they thought that a company was running on those lines. I presume that I am now a shareholder in the State airlines, and as such I ask the Parliamentary Secretary to give this information to the Committee. He has been asked the figure before but he says that he does not know. That is a peculiar state of affairs, and I suggest

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    that he really goes into it and gets his enormous staff, which is going to cost him the large sum of £1,356,000 annually, to find out what this cost of operation is and will be.
    Finding the figure is quite easy, and the Minister has all the information which will give it to him. The figure may be very high, and I should think it is. It may be higher than any other country in the world, but I hope that this will not deter the Parliamentary Secretary from giving it to us. The cost of operation may be high because the British lines are putting in a great deal of training and paying pilots when they engage them without knowing whether they will be good pilots or bad ones. They do the same with their radio operators and their ground staffs. That is a very creditable thing to do, but it costs a great deal of money. However, the Parliamentary Secretary should now give us the figure of cost per passenger-mile straight off the bat.
    The Parliamentary Secretary has said, much to my surprise, that the sum of £1,356,000 is to go as salaries for staff officers sitting in the Ministry. If that is so—
    Mr. Lindgren indicated dissent.
    Mr. Aitken: —it is pretty high and I suggest that the Parliamentary Secretary finds out what the operating costs are in order to see whether he is making a profit or a loss on running his aircraft. At the moment the Government are flying out of control in the clouds of high finance.
    Mr. George Ward: I would like to say a further word on the question of the increased salaries for additional personnel at the Ministry of Civil Aviation. On the face of it, it looks as if there is a certain amount of empire building going on. I would like the Parliamentary Secretary's assurance that there is no unnecessary duplication of work through people having assistants they do not really need. According to an answer given by the Parliamentary Secretary to a Question, on 20th December, 1946, by the hon. and gallant Member for Central Glasgow (Colonel Hutchison) and also according to the figures given in his opening speech today, the position is as follows. The headquarters staffs of the three Corpora-
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    tions have 3,746 people, and the staff of the Ministry 5,900—
    Mr. Lindgren indicated dissent.
    Mr. Ward: The Parliamentary Secretary shakes his head, but I made a note of the second figure as he gave it and I can also quote from HANSARD in support of the first figure. They come to a total of 9,646. I do not know the exact number of aircraft actually engaged on carrying fare-paying passengers day by day on regular routes, excluding training and testing, but I should imagine that 200 would not be wide of the mark. I shall be grateful if the Parliamentary Secretary will tell me if I am very wide of the mark, but I imagine 200 is the rough figure. Divide 200 into 9,646 and we find that for every one aircraft carrying passengers airborne we have 48 people chair-borne. That does not include the ground crews. Those are people holding down office jobs. It is a very important figure because during the war as a staff officer one knew how the size of staffs was inclined to creep up unless someone kept an eye on it. Whenever the Establishments Committee came along there was an argument. People always wanted to keep the odd extra staff officer. Any normal healthy man who has not a full day's work to do will make a full day's work and will push out a lot of unnecessary paper which only clogs the wheels.
    I appreciate as much as anybody else the difficulties with which the Minister is faced in the field of civil aviation, but I think also that many of us on his side of the House are not entirely happy that these difficulties are being tackled as efficiently and rapidly as possible. If the Parliamentary Secretary can, when he replies, answer many or, if possible, all the points which have been raised in this Debate by various hon. Members, it will go a great way to promoting and increasing the confidence and interest of the flying public in our civil aviation.
    Sir Ronald Ross: This discussion on the Supplementary Estimate has shown that civil aviation should soon have a day which is unrestricted by the very strict Rules which you, Major Milner, have the duty to apply. I know that your kindly nature would impel you to let people talk about all sorts of other questions, such as the types of aircraft, but I know that your sense of duty, and

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    only your sense of duty, prevents you from doing any such thing. Therefore, the art of speaking on a Supplementary Estimate is recognised as being one of the most difficult of Parliamentary arts.
    I do not propose to mention any type of aircraft at all, but rather to discuss the Supplementary Estimate as it stands. It is nominally £10, but actually the under-calculation is the very substantial figure of £2 million. Quite frankly, that is rather a disquieting calculation, and it is only for a period which finishes at the end of March; it is not for anything in the future. It is very recently that we have had the Civil Aviation Bill, and it certainly would have appeared that it might have been possible to make a closer estimation than was made, because the proportionate increase of salaries under Sub-Head A of nearly half a million pounds is practically a 50 per cent. increase on the original calculation, and it should, surely, have been possible to have known more accurately than that what it would cost.
    The point to which I particularly want to address myself—and I hope the Parliamentary Secretary will be able to answer these questions that I put—is under provisions granted to British Overseas Airways Corporation. He said in his opening speech, which was very pithy and brief and did not give, very much illumination, that this was, amongst other things, for the development and opening of new air routes. Of all overseas air routes, I would submit that the most important are those overseas air routes which go to that portion of the United Kingdom which is overseas. More than a year ago the Ministry informed me that there would be an overseas air route from England to Londonderry. So far, nothing whatsoever has been done. It is a very urgent necessity because it is one of the most difficult of journeys, and if, in reply, I could have some information as to what is being done, what steps are being taken, and what the prospects are, I should be very glad. We see in this Supplementary Estimate the interest which the Ministry take as regards the Sudan and their sympathy with those who fly in the South Pacific, but I would like to bring it rather nearer home.
    Again, the posts were to be carried by air under the Ministry of Civil Aviation, and I think that depends to a great extent
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    on the adaptability of aerodromes in England for night flying. Is any of this money towards the deficiency grant being applied to preparing the way for night flying in order to carry the mails with reasonable rapidity from Great Britain to Northern Ireland? If so, what progress has been made, how soon may we expect to have the service of the carriage of mails to Northern Ireland by air, and to give a proper service between the various parts of the United Kingdom?
    I think that up to the present I have created a record as being the only hon. Member whose speech has been unblemished by any hint of being called to Order by you, Major Milner. I will conclude by pressing these two points on the Minister in the hope that I shall get a reply as encouraging to me as, I am sure, my speech has been to you.
    Mr. Hollis: I associate myself with the protest of my hon. Friend the Member for Holborn (Mr. Aitken) and my hon. and gallant Friend the Member for Macclesfield (Air-Commodore Harvey) against the inadequacy of the Parliamentary Secretary's original speech. The hon. Member for Londonderry (Sir R. Ross) said it was pithy and brief. It was very brief, but I rather missed the pith in it, if pith there was. I must confess that the task which this Committee has to face this evening would, in any event, have been a difficult one, partly by the nature of the Supplementary Estimate, and partly by the monstrous confusion between the functions of Government Departments, the R.A.F., and civil aviation. For these difficulties the Minister and the Parliamentary Secretary are clearly not to blame, but this task, which would in any event have been difficult, he has made all the more impossible for us, because it was manifestly impossible to discuss intelligently the Estimate unless he had furnished us with very full information indeed as to what it was about, so that hon. Members could have had an opportunity of keeping themselves in Order and not incurring your displeasure, Major Milner.
    I will not attempt to plunge into the impenetrable jungle where my hon. Friend got lost, but I would remind the Committee of the two outstanding factors of which we can be certain, amongst many of which we cannot be certain.

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    One is that it appears that the fewer the aircraft we have, the more money we have to spend on bureaucrats. That is a very disquieting thing, and I hope that the Parliamentary Secretary will respond to my hon. and gallant Friend's most important and reasonable request to find out what is the cost per passenger mile.
    A second equally disquieting thing is that, when we were nationalising civil aviation, we were told that these Corporations were to aim at being self-supporting. Whatever else is not clear from this Estimate, it is at least dear that the very wide difference between the original and the revised Estimates proves quite clearly that the Ministry has extremely little idea of the cost of these operations, whatever the operations may be. The operations are obscure, and the cost of them is more obscure, so I will appeal to the Parliamentary Secretary to give this Committee a great deal more information than has been given up to the present.
    6.0 p.m.
    Mr. E. L. Gandar Dower: I should like to congratulate the Parliamentary Secretary on the brevity of his opening. I feel sure that he wanted to reserve his charm for a full reply to the criticisms made from this side of the Committee. I noted that when the Parliamentary Secretary dealt with the amount which had been spent in development costs which were responsible for a large portion of the expenditure he said they were a non-recurring and valuable item. I was glad to hear that, because development and goodwill were not admitted as items of value under the Civil Aviation Act, 1946. In considering the necessity for Supplementary Estimates one must pay attention to the reliability of airlines. Such reliability leads to very wide use, and that helps to meet expenses, making Supplementary Estimates unnecessary. I have recently seen the operation of the London Scottish Airline to Aberdeen, and I ask the Parliamentary Secretary if he could give the reliability figures over the last three or four weeks. That is advertised as a daily service, and it has been missing quite a lot. This service operates reasonably up-to-date aircraft like D.C.III.s with a good instrument board. But, during these hard times of bad weather and snow, the old pioneer airlines of Scottish Airways and the local firm in Aberdeen have managed
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    to run daily services. I felt a personal interest in this matter, because I endeavoured to use this nationalised Government-run airline to obey a three-line Whip to attend the Electricity Bill Debate, and was unable to reach the House.
    The Chairman: I am sorry to interrupt the hon. Member, but will he indicate where Scottish Airlines are mentioned in the Supplementary Estimate? Do they come in the groups of deficiency payments?
    Mr. Gandar Dower: I was trying to illustrate how deficiency in regard to B.O.A.C. was affected by reliability of service, and to point out that they were not reliable in Scotland.
    The Chairman: The hon. Member is in Order if the airlines come within the British European Airways Corporation.
    Mr. Gandar Dower: Yes, Major Milner, they now do. This small Supplementary Estimate for £10 leaves us with a sense of disquietude, because of the large sum of money which has not been spent on aircraft. I think this side of the Committee would have been better pleased if the money had been spent on up-to-date aircraft. Throughout the war, the accounts of B.0.A.C. were wrapped in mystery, and one is glad to see some approach to presenting them today. When a Department has such heavy losses at a time when world aviation is prospering, one cannot feel too satisfied. I would gladly lend all the support I can to the hon. Member for Holborn (Mr. Max Aitken) in asking for the cost per mile operational figures of the three nationalised companies. In regard to the additional plant needed for B.E.A.C., I would like to receive an assurance from the Parliamentary Secretary that everything is being done to save unnecessary duplication of staff. At Aberdeen, for instance, there are two traffic staffs, one for the local company—now part of B.E.A.C. —and another built up since the airlines from Inverness and from London and Glasgow commenced. It appears that this duplication is not necessary; and one wonders what will happen later on.
    Mr. Marlowe: It would be unfair to criticise the Parliamentary Secretary for the form in which this Supplementary Estimate is presented, because it is the time-honoured form in which these things are always done and they give great paucity

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    of information. That throws on the hon. Gentleman all the more burden of explaining as fully as possible what we are being asked to pay. The hon. Gentleman has been very attentive throughout the discussion, and I hope he will do his best to answer the many pertinent questions which have been put to him.
    This document is rather in the nature of a prospectus of a company. I do not think any company putting out a document of this kind, and explaining it so briefly, would expect the public to subscribe. When people are putting money into a service, they expect to know what it is they are paying towards. At the moment, we are very much in the dark. Indeed, before you, Mr. Beaumont, were in the Chair, it was necessary for many hon. Members to stop discussing various subjects because they did not know whether they were in Order or not, and whether they came within a particular Vote. One is in considerable difficulty, because there is a sum of nearly £1 million in respect of deficiency on B.O.A.C., and another of a similar amount on B.E.A.C. But, for what that money is paid we have very little information. Taking the document as it stands, it appears that the original Estimate was made for more than £1 million, which has so far not been spent under Subhead (E), which is now being deducted. I suppose it was assumed that the sum of £2,183,000 was to be spent on aircraft and associated equipment. I take that to be so from the note which is attached to the document. Presumably that is being deducted from the amount that has not been spent. What is alarming is that although there is £2 million less aircraft and equipment, the running expenses are more than was originally anticipated. The original estimate for maintenance and running costs was on the basis of £2 million worth of aircraft and associated equipment bringing in money. One is driven to conclude from this document that there are less aircraft, and yet higher losses. That must only mean that the more aircraft we get into the air the more money we are to lose.
    I would like the hon. Gentleman to say whether he anticipates that as he increases the number of aircraft he will lose more money. I make no complaint that this is not a profit-making concern at this stage, but what is going to be the position in the future? Are we to suppose that as we get more aircraft
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    into the air we shall get better returns, and so smaller deficiencies because of the rather alarming deficiencies we find at present when the hon. Gentleman has to come and ask for a further £2 million? I ask him to give the information on which the cost per passenger mile is based. That is a figure which any commercial firm has to have easily available. If they did not know whether an aircraft was paying its way, they would not know whether the service was successful. I do not know if the hon. Gentleman does not like to give the figure because it is so high. Or is it because he does not know the figure? At Question time he said he was not able to give it—I have not the text of his reply before me, and I do not know whether he said he could not give it. If the reason is because the cost is high, what is the reason why the cost is high? Will the hon. Gentleman confirm or deny the suggestion which has been made that large numbers of non-fare paying passengers are being carried, and that that has largely contributed towards the high cost? That is the sort of question which requires attention, and which deserves an answer before we part with a Vote of this size, and allow this Ministry another £2 million.
    Mr. Erroll: I regard this Supplementary Estimate with considerable misgiving, because it shows that something has been taking place which all of us on this side of the Committee feared during the Committee stage of the Civil Aviation Act, namely, a transfer from capital account to revenue account, but none of us anticipated that it would take place so soon. Here we see money which was originally voted for the supply of aircraft diverted to what are essentially revenue items. I would be prepared to allow this to pass if the Minister could give an assurance that, perhaps in next year's Estimates, an equivalent amount from revenue account was to be transferred back to capital account. What I fear is that in next year's Estimates or perhaps in those of the year following, the Minister will come along and ask for a further sum of about £2 million for more aircraft, and will use, as his justification, the argument that the sum previously granted had been diverted to revenue account. It is important, if we are to have efficiently run Corporations, that there should be a clear demarcation between what in business circles are called capital accounts and what

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    are called revenue accounts. Now that we are having a diversion one way, I hope we shall have a comparable diversion in the reverse direction to redress the balance, some time in the future.
    With regard to the extra moneys going towards staff, both staff under Subhead A, for the Ministry, and staffs in the case of the three Corporations, I would say that we all know how satisfactory it is to be well looked after on one of the Corporations' air lines, but I suggest that at a time when there is the greatest shortage of manpower elsewhere, we must have regard to the manpower expended on providing air services, particularly where those are domestic or inter-Colonial. We have to save in manpower wherever we can. On the West African service, in particular, there is still quite a prodigality of manpower. We must get used to the fact that some of the feeder services, particularly up country in Nigeria for example, must be manned on a simple and elementary basis, and that we cannot really have the same standards of manpower there as on first-class international services, or as one would expect at an international airport such as Yundum in the Gambia.
    I am not surprised that both B.O.A.C. and the South American Corporation should require additional money, because in the journey I made with the Parliamentary Delegation to West Africa, I came across a clear example of a duplication of services along an identical route. Certainly, I never expected the old bogy of unnecessary duplication to rear its ugly head so early in the days of this new nationalised enterprise. Yet we have British South American Airways running a service to Dakar and then across to South America. It is paralleled part of the way by B.O.A.C., which is running a similar service, not to Dakar, but 80 miles further down the coast to Bathurst, and so round the coast to what I can only describe as the greatest cul-de-sac in the world, the Bight of Benin, from where there is no further extension. I suggest for the serious consideration of the Ministry that these two services might be amalgamated as far as one point on the West African coast. That point should obviously be the Gambia, where there is already a fine aerodrome with first-class services. As things are we have to keep
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    staff of the South American Corporation at Dakar, where they have to expend French francs, admittedly a "soft" currency, but nevertheless a foreign currency, for maintenance, etc., while 80 miles down the coast B.O.A.C. have duplicate facilities. Why not combine the two services, into one, running to an airport in the Gambia, and so save a good deal, as well as promote efficiency? Furthermore, Bathurst is also an ideal flying-boat base, and while the fashion for the moment is for land planes, fashion may yet turn back to the flying boat. I notice that the Government-owned flying boat firm of shorts is advertising the safety of flying boats, so they may well come back into their own. It is high time that the South American Corporation moved to Bathurst, amalgamated its service with the B.O.A.C., and saved the considerable deficiencies which are being involved by the duplication of services. I hope that the Minister will look into this matter and see whether he can give us some information on it.
    6.15 p.m.
    As regards staff in general, I deprecate any suggestion that the staffs of these various Corporations are anything but most helpful and courteous. They seem to be maintaining the highest standards and traditions of British transport services. I was particularly glad to see that the temptation to incorporate a large number of women stewardesses on various routes has so far been resisted. There is something reassuring about a male steward, particularly in a Dakota these days. There are many small points which might well be considered. For example stewards might carry change in the currency which passengers are likely to have available. That might not require greater salaries, but it would improve efficiency.
    If we are to have highly paid administrative staff we must see that we get a high standard of service. For example, at Airways Terminal at Victoria—I do not know whether it is controlled by the Ministry or the Corporations—there is no, left luggage office. One may have to take one's bag there at three or four a.m. because one cannot leave luggage there the night before. To meet a point like that only requires a small amount of brains and initiative. If we are to pay these officials large salaries we expect commensurate service in return. To be unable to

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    leave one's bag overnight at Airways Terminal at Victoria without a special "fiddle-faddle" with members of the staff is completely ridiculous. I know it is a small point but passengers—including foreign passengers—notice small points. We are entitled to tip-top service if we are paying tip-top salaries.
    I would conclude by stressing the importance of developing Bathurst as an airport. Meteorological services are already there; there would be no need further to increase the deficiency grant under Subhead H, and it would be an all-British base. Otherwise, that small Colony may well become a liability to the Exchequer, whereas it would be self-supporting if my suggestion were adopted and ancillary services were provided for a large and adequate airport. The Parliamentary Secretary's predecessor at the Ministry has gone to the Colonial Office. I hope the two of them can confer on this matter, and see if they can adopt this suggestion.
    Mr. Orr-Ewing: In spite of what has been said by my hon. Friend the Member for Altrincham and Sale (Mr. Erroll), I know he will agree with me when I say that I hope that no attempt will be made to cut at least one part of the staff, that is, those engaged on maintenance and supervision. That would be a poor economy. As we are running these Corporations at such high expense and at a considerable loss, it would be most unwise to tamper with that side at all, except to improve it. One hears stories about delays in granting airworthiness certificates, etc., which I do not think should arise. Perhaps the Parliamentary Secretary will be able to say something about that.
    I rose really to deal with a bigger issue. One cannot help feeling concern with the form in which the Supplementary Estimate is presented to the Committee. It has been said that this is the first Supplementary Estimate concerned with a purely nationalised industry to be presented to the Committee. Though, at all times, in this Debate there has been the most admirable consultation between the Chair and hon. Members, it has become apparent that there is considerable difficulty in carrying on a Debate on an Estimate of this type, in spite of the fact that we are sitting here more in the form of a hoard of directors than in our usual
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    form. That is because we are considering a nationalised industry. I raised this issue in another field, when we were considering the Committee stage of the Money Resolution of the Agriculture Bill. I asked whether any efforts would be made to place the accounts of these nationalised concerns before us in understandable form, a form which would not make it necessary for the Parliamentary Secretary to spend the greater part of a Parliamentary Day listening to a great deal of discussion between the Chair and hon. Members to discover what could be talked about.
    I uphold, as do all hon. Members, the Rulings of the Chair in every respect. I hope that what I am saying now will not be taken in any sense as disrespectful to the Chair. But I submit that the discussion on this Estimate shows that the machinery of Parliament is not attuned to dealing with the accounts of nationalised industries as we know them now. I think that has been so apparent, that everybody who has been here today must have become aware of the difficulty. It may well be that that, in itself, will provide an incentive to the production of a remedy. I had wished to raise several points on this Estimate. I find I am completely debarred from doing so, though I am certain that those issues upon which I would have spoken are relevant to the Estimate. Unless I get the knowledge for which I should have asked, I shall not feel happy in giving support to this Estimate. Parliament is to be put into prolonged suspense and hon. Members will be wondering whether they are arriving at fair judgments on these matters. They cannot extract the correct information owing to the procedure—
    The Deputy-Chairman (Mr. Hubert Beaumont): The hon. Member is out of Order in discussing the form of the Supplementary Estimate. The form conforms with practice and usage.
    Mr. Orr-Ewing: Would I be in Order in drawing attention to the fact that the form to which we are bound at present, does not enable us to extract all the information which many of us wish to extract?
    The Deputy-Chairman: It would be in Order to make a remark to that effect but not to debate it. Only what is in Supplementary Estimates can be discussed.
    Mr. Orr-Ewing: Thank you for your Ruling, Mr. Beaumont. I do not propose to carry the point further. Our main concern is about this very large sum of money. I am concerned at the large amount which we are asked to vote to cover the very short period up to the end of March. That would appear to me to be the most serious item which we are asked to consider. I hope the Parliamentary Secretary will be able to give the Committee some confidence, before we vote on this matter.
    Mr. Walter Fletcher: I think the best tribute I can possibly make to the working of the various Government-owned air services is that they have recently transported me for many thousands of miles in complete safety. Having paid that tribute, I think I am entitled under this Estimate to point out one or two defects. During a trip to the Far East and back, I could not but admire the work of the pilot and the service members of the crew, but certainly at the points at which we descended, there were considerable deficiencies among the ground staff. For instance, on returning to this country after a very severe trip, we found on arrival at Poole that, for half an hour, there was no medical officer present. The aircraft was almost filled with distinguished Australians coming to this country. A search was made to find one of the two medical officers who should have been there. When I questioned them, it became obvious that they had much other work to do—this was only part of their work—and that they were really doing their best. For this rather perfunctory examination, we had to wait for nearly 40 minutes with the risk of missing the only remaining connection to London, and that was after a long and tiring trip.
    I suggest that this situation calls for an overhaul of the whole system of quarantine work. No part of the other procedure at the airport, dealing with Customs and security, could begin to function until we had passed through quarantine. When I questioned the medical officer he replied, "Well, it is very stereotyped. It is true that you have been mixing with members of the B.0 A.C. staff already and it seems to be rather senseless that you should be held up." Meanwhile, we were handed what seems to be the sign manual of the
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    B.O.A.C., a cup of tea. That is only a minor point. I ask the Parliamentary Secretary if he will look into the whole question of quarantine work, which in many cases has become quite farcical.
    What is infinitely more important is the question of the future working of civil aviation in Singapore. That will become for aviation, as it always was for shipping, one of the most important points of the British Empire, a point where competition from overseas is likely to be met. If, as I believe to be the case, there is no adequate machinery inside the Colonial Office itself, so that work can be carried out between the Ministry of Civil Aviation and the Colonial Office tending to the proper development of that port, then I think it is time that such machinery should be furnished. I went into this matter thoroughly. I believe that the reason no decisions are being taken at present, and no real progress is being developed in that highly important airport, arises from the defective machinery inside the Colonial Office.
    In Hong Kong, which has, probably, the most difficult of all airports on which to land or take off, again there seems to be difficulty in arriving at important decisions for development. I believe that radar was installed there only recently, and it is by no means complete, in a place which is particularly subject to fog and the sudden descent of cloud. I ask the Minister to go most carefully into the technical difficulties which are known to his advisers, and see whether a change of administrative machinery is not required. There is no doubt that some of these overseas airports are far away and, therefore, out of mind. Where we are looking to meet major competition from other forms of transport which are not nationalised and just possibly therefore—I will not put it any higher—equally efficient, it might be well to replace complacency with a deep study of whether we are moving quickly enough in the right direction and, above all, whether we are attracting sufficient of the right type of staff.
    I look with some suspicion on these accounts, which I have been through only very cursorily. When one realises the enormous amount of assistance furnished by the R.A.F. to civil aviation all over the world, one is slightly in doubt about how that is being charged and whether civil aviation is not receiving a vast amount

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    of service for which no direct payment is made. There is no doubt that in many parts of the world if there were no R.A.F. stations around—and Singapore is undoubtedly one of them—civil aviation would be at a complete standstill. That does not come out very clearly in these accounts, but it is a matter which, in a few years' time, when there has been a better chance of development, might well be more obvious.
    6.30 p.m.
    Mr. McKie: I should like to support the point made by my hon. Friend the Member for Londonderry (Sir R. Ross) about the provision of an air service to the city of Londonderry. My hon. Friend said he had frequently discussed this matter with the Parliamentary Secretary and had received assurances from him, and he now asks the hon. Gentleman if, in his reply, he will say why, up to the present, this air service has not been provided. It always gives me pleasure to support anything relating to the problems of Ulster, and, on this occasion I fully realise that, if the Parliamentary Secretary is able to say something encouraging about the provision of this air service, it may well be, in years to come, of material benefit to the South-West of Scotland as well. I also support what my hon. Friend said about the provision of air mail services to Ulster. I understand that this matter has been previously discussed between my hon. Friend and the Parliamentary Secretary, but, just as was the case with the air service to Londonderry, up to now no provision has been forthcoming as a result.
    I hope the Parliamentary Secretary will have something to say about Subhead H, which provides for the Supplementary Estimate for providing grants towards meteorological services for Empire and other routes. The hon. and gallant Member for Macclesfield (Air-Commodore Harvey) had something to say about that, and I hope the Parliamentary Secretary, since we are now being asked for more than treble the sum originally asked for, will take his words to heart. This is a matter which does not only concern people who travel by air or people who travel by other means. It concerns the public generally, whether they travel or not, I do not wish unduly to criticise those who make weather forecasts for not giving us very accurate in-
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    formation as to what is likely to happen, but I would say that, if we are to provide this very largely increased sum of money, I hope we shall have a better return in the future, in this direction, than we have had in the past.
    I hope the Parliamentary Secretary will go into the many points made and answer the questions addressed to him. When opening the Debate he did not give us the full information which most of us hoped he would be in a position to give. If he had done so, no doubt, the Debate would have taken, so far as the Rules of Order permit, a much wider scope than has been the case. The hon. Gentleman might have given us more meat for discussion. Perhaps, that was intentional on his part. I always support a Ministerial statement which is brief, but, on this occasion, when we are asked to provide large sums of money, in addition to the sums already asked for by the Ministry, I think we have a right to a very full explanation of the reason why these large additional sums are necessary.
    Sir Ralph Glyn: I do not wish to detain the Committee, and I thank the Parliamentary Secretary for his courtesy, in giving way to me, but there is one matter which is very important in connection with these Estimates. As has been stated already, the business of civil aviation impinges on the Estimates of other Departments, and, while the form of the accounts is the ordinary form, the details are necessarily scanty and it is out of Order to discuss the form of the accounts itself. I ask the Parliamentary Secretary what steps it is proposed to take to implement the promise given while the Civil Aviation Bill was passing through the House, that occasion would be taken to give the House full information about the development of civil aviation and how far co-operation was being obtained from such other Departments as the Ministry of Supply, the Colonial Office and so on.
    We all know that the R.A.F. Transport Command has been a sort of wet nurse to civil aviation. We know how successfully it has done its work, with ever-diminishing material, and how it has helped at many times and places. I think that all the information which one receives from places like Hong Kong and Singapore shows that it is very important that this Committee should realise the necessity for

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    close association between the Ministry of Civil Aviation and other Departments. I hope that, when accommodation is put up in the Sudan, steps will be taken not to repeat the mistake that we made in West Africa, where the accommodation provided for our airmen was much inferior to that provided by the United States for their own people. For instance, none of our men had water-borne sewage or anti-mosquito netting, while the American type of hut was absolutely first-class. I believe that, if we are to establish a successful service, one of the most urgent things is to see that the accommodation for the ground staff is first-class, from the medical point of view.
    Mr. Lindgren: May I explain that it was with no intention whatever of discourtesy that I was brief in my opening statement? In fact, I had been informed that it would be discourteous to the Committee if I talked too long, and it did seem to me that I would get it one way or the other; that if I was brief, I would be wrong, and if I talked too long, I would also be wrong. Equally, in dealing with the points raised in the Debate, I hope the Committee will forgive me, since it is difficult to put all these points chronologically in the form of a speech, if I deal with them in the order in which they were raised by hon. Members.
    At the outset, I am afraid that I, like ether hon. Members, may get into difficulties as to what is in Order and what is not, but the first point, I think, is that of the relationship of the Ministry of Civil Aviation with the three Corporations whose deficiency grants are included in these Estimates. Many of the points raised by hon. Members opposite have been points of administration within these Corporations I think that, sometime or other, this Committee will have to make up its mind exactly what it does require of the Minister or his Parliamentary Secretary. [Interruption.] I am glad to have the agreement of the noble Lord. Having just come in—
    Earl Winterton: The hon. Gentleman has done me an injustice. I am sorry to say that I was not taking the slightest interest in what he was saying as I was reading the Supplementary Estimates. The hon. Gentleman has mistaken me for someone else.
    Mr. Beeehman: I have also been done an injustice. It was I who made the remark.
    Mr. Lindgren: The point was the relationship between the Ministry and the Corporations, which are socialised undertakings. During the Debate on the Civil Aviation Bill, and in other Debates, there has been an emphasis on the fact that these are business undertakings, and that the Minister should not interfere with the day-to-day management of those undertakings. Assurances were secured during the Debate that such interferences would not take place. The cost per passenger mile of aircraft is entirely a matter of administration, as is also the staffing of the Corporations. They are business details of management within the Corporations, and, therefore, do not form the subject of discussion in this Committee or on these Estimates.
    Mr. Max Aitken: Surely, the Minister concerned should know the cost per passenger mile, and, surely, the Corporations must report this most important point to the Minister, or does he just let it go by the board?
    Mr. Lindgren: I am obliged to the hon. Member for making that interjection because, although we have to get it quite clear at what times these matters are appropriate for discussion, one would agree that they are subjects which ought, at some time or other, to be discussed in this House.
    Mr. Lennox-Boyd: I think I would be in Order in reminding the hon. Gentleman and the Committee that the Civil Aviation Act, 1946, provides:
    "Each of the three corporations shall keep proper accounts and proper records in relation thereto and shall prepare in respect of each financial year a statement of accounts in such form as the Minister may, with the approval of the Treasury, direct.…"
    If the Minister directed, as he should, that the Corporations should show the cost per mile of the various heads of aircraft, then the Corporations would advise him to that effect.
    Mr. Lindgren: That was the next point I was going to make. The accounts of the Corporations are to be made in the form required by the Minister, and I can assure the Committee that detailed consideration has already been given by my

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    noble Friend as to that form. Having seen the accounts of commercial undertakings, prior to my entry into this House, I can say that the form of these accounts will be very informative indeed compared with the statement of accounts of normal business undertakings. Secondly, those accounts are required to be audited by public auditors. Thirdly, they are required to be presented to this House. I suggest that the proper time for discussion of the administration of these Corporations would be when the accounts were before the House, and when hon. Members knew to what the items refer.
    Mr. Orr-Ewing: Would the hon. Gentleman not agree that, as we are being asked to find additional money, it would have been a good thing if some form of interim account had been before the House, at some stage, so that we might know where we are?
    Major Bruce: Will my hon. Friend think twice before making publicly available information which is not normally made available by public corporations? Will he bear that consideration in mind before he publishes too much information?
    Air-Commodore Harvey: Will the hon. Member also bear in mind that the Civil Aeronautical Board in America publishes a monthly statement giving costs, mileage, and so on?
    6.45 p.m.
    Mr. Lindgren: In so far as the Corporations are concerned, their accounts are made up to 31st March in each year. So far as B.O.A.C. are concerned, their first commercial year has just been concluded. It is true that, since 1940, when the Corporation was established and since accounts have been forthcoming, the lag period between the close of the financial year and the presentation of those accounts has sometimes been as long as 15 or 16 months. We hope that that period will be cut down to something under 11 months. When those accounts come before the House the matter will then, I think, be due for discussion. As the hon. Member for Mid-Bedford (Mr. Lennox-Boyd) asked, and as I have already indicated, under the Act, those accounts are required to be up to the best commercial standards.
    Mr. Lennox-Boyd: Does what the hon. Gentleman has said mean that there will be a period of 11 months after the conclusion of the financial year before any Estimate is submitted to Parliament, and does that really conform to the best commercial standards?
    Mr. Lindgren: Not before it comes before the House, but before the actual accounts are concluded; there will be a lapse of 11 months before they are available to the House. I am certain that hon. Members opposite will agree that, for large undertakings with international commitments, that is not a long period to wait for the accounts to be made available. So far as B.O.A.C. are concerned, there have to be internal audits and audits in foreign countries. Its ramifications are worldwide. The collating and auditing of those accounts are long processes and, in previous years, and under other administrations, when the accounts were in smaller form than they are at present, it took 16 months before they were available. This time, it will be 11 months, and I can assure the Committee that everything that is humanly possible will be done to reduce that period of time. The hon. Member for Mid-Bedford raised a further point about the production of aircraft. He based his criticism of the accounts on the fact that deficiencies were required. He said that, had better types of aircraft been used, the deficiency grants required by the three Corporations would not have been required.
    Air-Commodore Harvey: And more aircraft.
    Mr. Lindgren: Yes, and more aircraft. One must admit that the question of aircraft is one for the Ministry of Supply, and, if I am in Order, I think it would be a fair question to ask the Ministry of Supply what they are doing to see that the requirements of civil aviation are met. There is a coordinating committee, known as the Self Committee, which takes its name from its chairman, Sir Henry Self. It consults the Ministry of Supply, the Treasury and the Corporations in getting out the detailed requirements, and also consults manufacturers and others as to the progress of aircraft production. The question of the production of the types of aircraft for civil aviation is receiving very urgent consideration and assistance from all the Ministries concerned.

    255
    I will now deal with the points raised in regard to Subhead A of the Civil Estimate and its reference to staff. The hon. Member for Holland with Boston (Mr. Butcher) suggested that the Ministry was growing out of all proportion to the real requirements of civil aviation. May I assure the hon. Member and the Committee that that is far from the case? So far as the Supplementary Vote is concerned, I tried to make the point, in presenting the Estimate, that it is not concerned with normal Civil Service administration; it is concerned with the very large business of running the aerodromes, the provision of radio aids, navigational aids, and the safety devices which are urgent in relation to the development of civil aviation. As to the deficiency grant for the British Overseas Corporation, this, as I tried to indicate in opening the Debate, is the first normal accounting year of that Corporation.
    In my opening statement I admitted that many of the costs which are now correctly borne on a commercial basis by B.O.A.C. and the other Corporations, were borne by the Air Ministry, for which no contra-charge was previously made to those Corporations. Since the passage of the Civil Aviation Act it has been a requirement—and I think the Committee will agree it is a correct requirement—that there should be no hidden charges so far as the Corporations are concerned, that they should, in fact, be operating an normal business lines, that their costs of operation should all be shown and that if a service is rendered by a Government Department in one form or another the cost ought to be paid for. I would like to dispel the idea which seems to have grown up, that because a person has a priority passage, or travels as a "V.I.P.," his passage is not paid. The passage of every passenger carried by an aircraft of the corporations is paid for by the appropriate Department authorising the journey. If the Colonial Office require a Member of Parliament to undertake a journey, the cost of that journey is paid for by the Department concerned.
    Earl Winterton: Will the hon. Gentleman pardon me, because this is a point of some constitutional importance? Do I understand that the expenses of Members are shown in detail on the Estimate? How, for example, can we ascertain how
    256
    many journeys the hon. Member for "Blank" has had at the taxpayers' expense? Is there any means of ascertaining it?
    Mr. Lindgren: That is a question which, I am afraid, I am unable to answer. All I can say is that if Mr. "A" is required by the Colonial Office to travel from London to Paris, he is issued with a ticket by the Corporation.
    Earl Winterton: I am not criticising; I want to know where this information is available. Speaking as a Member of the Select Committee on Members' salaries, I can say that there was no evidence before that Committee that hon. Members were in the habit of having these free passages.
    Mr. Lindgren: Perhaps my choice of a Member of Parliament was a wrong illustration. Let me put it this way. Hon. and gallant Members have, in fact, travelled on delegations at the requirement of someone—
    Mr. Butcher: Surely, no Government Department can "require" Members to go. All they can do is to invite Members to go.
    Mr. Lindgren: If, through inexperience, I have used an expression which is not in accordance with the general customs of the House of Commons, I most humbly apologise, but I think hon. Members know exactly what I meant to convey. Let me put it quite plainly. There is no free passage for anyone, in any circumstances, on any aircraft under the control of the Corporations. The Department authorising the journey to be undertaken meets the cost of that journey, and the cost appears under the appropriate Departmental Vote.
    Air-Commodore Harvey: Does the hon. Gentleman agree that if many of that type of passenger are carried and there is a profit, it is only a paper profit and not hard currency?
    Mr. Lindgren: Surely, it is not a paper profit. It is a journey which is required to be undertaken, whether it is on the "Queen Mary" or by aircraft on the Atlantic route If the journey has to be undertaken, the cost of the provision of that service has to be met from somewhere.
    Earl Winterton: Could I ask this question? This is a point of some constitu

    257
    tional importance. I want to assure the hon. Gentleman that I am not criticising him. He knows quite well that a Minister's salary and expenses are shown. I am entitled to ask this question, and whether hon. Members agree or do not agree does not interest me. I am speaking as a Member of Parliament. I want to know where it is possible to ascertain the journeys made by Members who are not Members of the Government, which have been undertaken at the public expense.
    Mr. Lindgren: I am sorry, but I am afraid I cannot give the noble Lord that information. With his experience, I thought it might have been available to him. Certainly I am unable to give the information for which he asks. All I was asked—and this is a point which was made by several hon. Members—was whether the cost of the journeys undertaken by V.I.P.s was paid for by any Government Department, or whether this deficiency arose because we were carrying people and not charging fares. I assure the Committee that is not so.
    Squadron-Leader Sir Gifford Fox rose —
    Mr. Lindgren: I am always willing to give way to an hon. Member who has done me the courtesy of sitting through a Debate, but I think it is a little hard to expect me to give way to a Member who has only just come into the Chamber. If I might develop the point further, the deficiency in respect of B.O.A.C. arises because of the lack of a real financial basis on which we had to make the original Estimate. There has been criticism by a number of hon. Members of the fact that Items.J.2 and J.3 were not seen earlier and that they ought to have been included in the original Estimate. That was impossible, and I thought I had made it clear in the opening statement. B.E.A.C. and British South American Airways were not constituted until 1st August. They were not authorised until the passage of the Civil Aviation Act, and they did not receive the Royal Assent until 1st August. It was, therefore, impossible to include in the Estimates for 1946–47, when they were presented to the House, provision for something for which there was not authority to set up. Therefore, the criticism with regard to the non-inclusion of those items in the full Estimates is, I think, invalid.
    258
    With regard to the criticism concerning the meteorological services, for which there is an extra charge of £45,000, that is not a gross underestimate of requirements, as has been suggested. I did say in the course of my opening statement that there were charges in the Sudan for the years 1944 and 1945, which were not submitted during those years by the Sudan Government to this Government. It is equally true that there were charges undertaken for services provided by the New Zealand Government in the Southern Pacific during those years, and they have rendered their accounts late. Those accounts having been rendered late, they are paid when they are rendered. They were included in the Estimates for 1944–45. There was a saving in those years, and this item is to meet a cost which has arisen over and above that which was anticipated when the Estimates were prepared, and not for the services provided during the present year. The hon. and gallant Member for Central Glasgow (Colonel Hutchison), to some of whose remarks I have referred, also made a point with regard to the Estimates being so very far out in regard to those services.
    7.0 p.m.
    I think I have dealt with all the points he raised, because the Estimates were not out. There has been a greater development of meteorological services, which is required by everybody.
    It was said that the Corporations were entering the field of charter work. An hon. Member read a statement made in the Committee by my predecessor in office, that in fact the Corporations would not enter into the charter business but would be available for charter business if they were specifically required to undertake it by any particular person. That is still the policy of the Ministry The primary function of the three corporations is to provide and maintain scheduled services. Charter work is outside the general field of their operations, except so far as they are directly asked to undertake that charter work. The hon. and gallant Member for Ayr Burghs (Sir T. Moore) asked about the lack of development at Heathrow. He asked why it was that ground control approach apparatus which was available at Prestwick during the war years was not also available to the Ministry of Civil Aviation at Heathrow, because of the development of Heathrow during that period. The simple answer to that

    259
    is, during the war years the provision of all that equipment and its utilisation was for war services and not for civil aviation services, and so soon as it became possible those services were provided at Heathrow, and we now require to establish crews to deal with them.
    The hon. Member for Holland with Boston suggested that the staffs which are required under the increase proposals were excessive. The technical staff for the development of radio and radar is a very large staff, but to suggest, as I understood him to suggest, that it was a nonproductive staff was a little unfair. The staff in the control tower, and the radio operators helping and assisting aircraft to arrive at given points are, in fact, very materially on productive work. The hon. Member asked what was the method of recruitment. The method of recruitment varies in regard to the class of person recruited. On the administration side, in all cases there is the assistance of the Ministry of Labour Appointments Board, but the method of selection is either by way of the Civil Service Commission or, in the case of industrial staff and general appointments on the ground, by an appropriate official, taking account of the technical skill of the person to be appointed. Obviously, if a person is required for a highly skilled operation a different method of recruitment and selection is adopted than for, say, a general ground labourer on the aerodrome. But so far as possible the Ministry of Labour recruitments appointment branch is used. As I interjected during the Debate, 95 per cent, of the staff recruited for this work has, in fact, come from the Services, and particularly the R.A.F.
    With the exception of the question of the hon. Member for Worcester (Mr. G. Ward), as to what were the numbers of aircraft operating, I think I have answered most of the questions which have been raised during the Debate. So far as the aircraft which are operating are concerned, British Overseas Airways Corporation—and I think we ought to take pride in this—is the largest airline in the world operating a fleet of 200 aircraft; British European Airways Corporation operates a fleet of 119 aircraft, and British South American Airways 27 aircraft. If my arithmetic is correct, that makes a total of 346 aircraft.
    Mr. Ward: Do those figures include training aircraft and aircraft being tested? I was concerned only with passenger carrying aircraft.
    Mr. Lindgren: They are, in fact, all passenger carrying aircraft. Of course, at times they are used on training and development flights. They are aircraft to meet scheduled services, and are used in varying ways—sometimes even in testing the correctness of ground aids and navigational aids. They are aircraft of the fleet, used at varying times in the scheduled services; they are passenger carrying craft.
    I turn to the services to Northern Ireland. The services number, I think, 36 per week, and are provided from London to Manchester, Liverpool and Belfast. I was asked in particular when they will be provided to Londonderry. That depends very largely upon the availability of the aircraft. As was pointed out by the hon. Member for Mid-Bedford, much depends upon the availability of the aircraft—perhaps even the full effectiveness of the Corporations in the service that the aircraft render.
    Sir R. Ross: The hon. Gentleman said the aircraft were not available. They are available apparently to carry tourists in large numbers to Switzerland. I suggest that carrying people about the United Kingdom is much more important than carrying tourists to Switzerland to spend currency.
    Mr. Lindgren: We can understand the local patriotism of the hon. Member. In fact, there is a difference of opinion between the various parts of the country as to which is the greatest urgency for service. Very considerable pressure has been brought upon the Ministry for the provision of continental services. There must be a balance between the provision of internal and continental services, and it is in that struggle that, up till the moment, whilst Northern Ireland had secured the service to Belfast, because of the difficulties in regard to the sea passage so far as Londonderry is concerned, it has not secured the extension of that service. I regret that at the present moment I am unable to answer the question in regard to the carriage of airmail. I did see a memorandum coming through the Department, and from that memorandum I thought airmail was being carried to

    261
    Northern Ireland by the B.E.A. planes, particularly on the Croydon service. However, I will make certain about that and write to the hon. Member. The hon. and learned Member for Brighton (Mr. Marlowe) criticised the form of these accounts. That is not, I think, a question for me to answer in this Debate. This is a form of accounts which, I understand, has been time-honoured in this Committee.
    Mr. Marlowe: I am sure the hon. Gentleman must have misheard what I said. I said I could not criticise the form of the accounts because they were in the time-honoured form. I asked him the question why he spent £2 million less on aircraft but more on salaries.
    Mr. Lindgren: I accept that correction, and am glad to have had it. So far as the lack of aircraft is concerned, it does not mean that less is spent on the ground. A very valid point made by the hon. Member for Mid-Bedford was that, if there are more aircraft flying, it does not necessarily mean greater ground costs, because whether two aeroplanes or 200 aeroplanes are run, there still have to be control officers, radar, and all the rest. Given effective use of manpower, increased aircraft do not mean increased costs on the ground, and the point of this Estimate is, that under Subhead A we have been provided in this country with a system of aerodromes and navigational aids at the moment, so that when the aircraft are available there will not necessarily be a greater requirement so far as ground staff are concerned.
    The only other point I need meet is that in regard to the overseas services provided by the various Corporations Here one may, perhaps, if it is in Order, acknowledge, as, I believe, hon. Members did towards the close of the discussion, the very great assistance which is rendered to the Ministry of Civil Aviation in the provision of existing services by the Air Ministry. When that dwindles, as it is obviously bound to do, then there will be found further increases in the cost of provision for civil aviation. There is very close liaison between the two Departments with regard to the services which are provided, and that liaison will continue, so far as humanly possible. With the diminishing of Transport Command, everything possible will be done for the
    262
    development of civil aviation, to take the place of the services which are provided at present.
    Sir P. Macdonald: May I ask about the very important question I put about the British West Indian Airways? If the hon. Gentleman cannot give an answer now, perhaps he will let me have the information at the earliest possible moment.
    Mr. Lindgren: I deliberately missed it, and was going to write to the hon. Gentleman, and for this reason—the first part of his speech was devoted to criticising the Ministry for having a deficiency grant so far as B.O.A.C. and B.S.A.A.C. are concerned. In the next breath, he asked us to take over an undertaking which was losing money, and which would require a further deficiency grant in order to maintain it. Frankly, I am not at the moment quite up to date with regard to the present negotiations and I would only say that there are negotiations with the Ministry involved as to the absorption of that company. I will write to the hon. Gentleman.
    Sir P. Macdonald: What I want to know is the decision. The chairman of the company, in a statement in "The Times" recently, said that they were waiting for a decision. One way or another, I think we ought to have the decision.
    Mr. Lindgren: I am sure that this Committee, which is discussing the matter today, will agree that the Ministry is correct in not paying more than the concern is worth when it is purchasing it. Some people, when they have something to sell, think that, though it is not making money, it is worth more than it is really worth.
    Mr. Beechman: I would, very briefly, put to the Minister a point which has been ruled to be in Order and which is of general interest. These Estimates cover work in the Department and salaries of aerodrome staffs. I wish to be assured, before we part with these Estimates, that State control of civil aviation does not involve a stereotyped regime and a rigid system.
    7.15 p.m.
    Mr. Lindgren: The point was whether or not State ownership of aerodromes would, in fact, mean delay of aircraft. At the moment, at least, the captain of an aircraft is the pilot of the aircraft. He decides whether he will take off or whether he will not; and whether the aero-

    263
    drome is Stale owned or privately owned, the person who decides to fly or to stay on the ground, is the captain of the aircraft, the pilot.
    Mr. Gandar Dower: The Parliamentary Secretary will, perhaps, forgive me if I mention that he has not replied to three specific points I raised. One was about reliability. I asked him to give figures for reliability on the London to Aberdeen service. The second was the question of duplication of traffic staff at Aberdeen. I shall be quite happy if he chooses to deal with both points by correspondence. The third point I wanted to put was, whether it is possible for the Government to announce their reliability figures on routes, so that we can judge whether they are putting up a good show.
    Mr. Lindgren: This is, in fact, a matter of normal day-to-day administration by the Corporations outside the scope of inquiry and interference by my noble Friend. So far as the present policy adopted by my noble Friend is concerned —and it is according to what he understands to be the instructions and specific requests of the House—it is that that such
    matters of administration as the frequency of service—the question of numbers of staffs at particular points, are entirely matters of day to day management, and outside the scope of his interference.
    Mr. Keeling: Would the Minister say what the Government's intentions are regarding Bathurst in West Africa? When I asked a question about it, I was ruled out of Order by the Chairman, but the question was repeated by my hon. Friend the Member for Altrincham and Sale (Mr. Erroll), and found to be in Order.
    Mr. Lindgren: The matter is at the moment under very serious consideration, as to which aerodromes shall be used. There is expenditure on one of these aerodromes of well over£1,000,000. If the report is adopted, and by correspondence, I shall be only too pleased to inform the hon. Member of what the latest developments are. A survey has been made, and arising from the report, various aerodromes will be considered.
    Question put, "That a sum not exceeding £5 be granted to the said service."
    The Committee divided: Ayes, 114; Noes, 289.

    Division No. 72.]

    AYES.

    7.19 p.m

    Agnew, Cmdr. P. G.

    Harvey. Air-Comdre. A. V.

    Mott-Radclyffe, Maj. C. E.

    Aitken, Hon. Max

    Haughton, S G.

    Nicholson, G.

    Amory, D. Heathcoat

    Headlam, Lieut.-Col. Rt. Hon. Sir C.

    Orr-Ewing, I. L.

    Baldwin, A. E.

    Hinchingbrooke, Viscount

    Osborne, C.

    Barlow, Sir J.

    Hogg, Hon. Q.

    Peake, Rt. Hon. O.

    Beechman, N. A.

    Hudson, Rt. Hon. R. S. (Southport)

    Peto, Brig. C. H. M.

    Boles, Lt.-Col. D. C. (Wells)

    Hurd, A.

    Pickthorn, K

    Boothby, R.

    Hutchison, Col J. R. (Glasgow, C.)

    Poole, O. B. S. (Oswestry)

    Bossom, A. C.

    Jarvis, Sir J.

    Prior-Palmer, Brig. O.

    Bower, N.

    Jeffreys, General Sir G

    Raikes, H. V.

    Bromley-Davenport, Lt.-Col. W.

    Jennings, R.

    Ramsay, Maj. S.

    Buchan-Hepburn, P. G. T.

    Joynson-Hicks, Lt.-Cdr. Hon. L. W

    Rayner, Brig. R.

    Bullock, Capt. M.

    Keeling, E. H.

    Reed, Sir S. (Aylesbury)

    Butcher, H. W.

    Kingsmill, Lt.-Col. W. H

    Renton, D.

    Butler, Rt. Hon. R. A. (S'ffr'n W'ld'n)

    Lambert, Hon. G.

    Roberts, Maj. P. G. (Ecclesall)

    Carson, E.

    Langford-Holt, J

    Ropner, Col. L.

    Challen, C.

    Law, Rt. Hon. R. K.

    Ross, Sir R. D. (Londonderry)

    Clifton-Brown, Lt.-Col. G

    Legge-Bourke, Maj. E, A. H

    Scott, Lord W.

    Cooper-Key, E. M.

    Lennox-Boyd, A. T.

    Shephard, S. (Newark)

    Corbett, Lieut.-Col. U. (Ludlow)

    Lindsay, M. (Solihull)

    Shepherd, W. S. (Bucklow)

    Crosthwaite-Eyre, Col. O E.

    Low, Brig. A. R. W.

    Smith, E. P. (Ashford)

    Digby, S. W.

    Lucas-Tooth, Sir H.

    Spearman, A. C. M.

    Dodds-Parker, A. D.

    Lyttelton, Rt. Hon. O.

    Stanley, Rt Hon. O.

    Dower, E. L. G. (Caithness)

    MacAndrew, Col. Sir C.

    Stoddart-Scott, Col. M.

    Drayson, G B.

    Macdonald, Sir P (I. of Wight)

    Strauss, H. G. (English Universities)

    Drewe, C.

    Mackeson, Brig. H. R.

    Stuart, Rt. Hon. J. (Moray)

    Eden, Rt. Hon. A.

    McKie, J. H. (Galloway)

    Sutcliffe, H.

    Elliot, Rt. Hon. Walter

    Maitland, Comdr. J. W.

    Taylor, C. S. (Eastbourne)

    Erroll, F. J

    Manningham-Buller, R. E.

    Thorneycroft, G. E. P. (Monmouth)

    Fox, Sir G.

    Marlowe, A. A. H.

    Vane, W. M. F.

    Fyfe, Rt. Hon. Sir D. P. M.

    Marples, A. E

    Ward, Hon. G R.

    Gage, C.

    Marshall, S. H. (Sutton)

    Walt, Sir G. S. Harvie

    Gammans, L. D.

    Maude, J. C.

    White, J. B (Canterbury)

    Glossop, C. W. H.

    Medlicott, F.

    Willoughby de Eresby, Lord

    Glyn, Sir R.

    Mellor, Sir J.

    Winterton, Rt. Hon. Earl

    Gomme-Duncan, Col. A. G.

    Molson, A. H. E.

    York, C

    Grant, Lady

    Morris-Jones, Sir H.

    Grimston, R. V.

    Morrison, Maj. J. G. (Salisbury)

    TELLERS FOR THE AYES

    Hare, Hen. J. H. (Woodbridge)

    Morrison, Rt. Hon. W. S. (Cirencester)

    Major Conant and

    Mr. Studholme.

    NOES

    Adams, Richard (Balham)

    Forman, J. C.

    Mellish, R. J.

    Adams, W. T. (Hammersmith, South)

    Foster, W. (Wigan)

    Messer, F.

    Allighan, Garry

    Freeman, Peter (Newport)

    Middleton, Mrs. L

    Alpass, J. H.

    Gaitskell, H. T. N.

    Mikardo, Ian

    Anderson, A. (Motherwell)

    Gallacher, W.

    Mitchison, Maj. G. R

    Anderson, F. (Whitehaven)

    Ganley, Mrs. C. S.

    Montague, F.

    Attewell, H. C.

    George, Lady M. Lloyd (Anglesey)

    Moody, A S.

    Austin, H. Lewis

    Gibson, C. W

    Morgan, Dr H. B

    Awbery, S. S.

    Gilzean, A.

    Morley, R.

    Ayles, W. H.

    Glanville, J. E. (Consett)

    Morris, P. (Swansea, W.)

    Ayrton Gould, Mrs. B.

    Gooch, E. G.

    Morris, Hopkin (Carmarthen)

    Bacon, Miss A.

    Goodrich, H. E.

    Mort, D. L.

    Balfour, A.

    Granville, E. (Eye)

    Moyle, A.

    Barstow, P. G

    Greenwood, Rt. Hon. A, (Wakefield)

    Murray, J. D

    Battley, J. R.

    Greenwood, A. W. J. (Heywood)

    Nally, W.

    Bechervaise, A E

    Grenfell, D. R

    Naylor, T. E.

    Benson, G

    Grey, C. F.

    Neal, H. (Claycross)

    Berry, H.

    Grierson, E.

    Nichol, Mrs. M. E. (Bradford, N.)

    Binns, J.

    Griffiths, D. (Rother Valley)

    Nicholls, H R (Stratford)

    Blenkinsop, A

    Griffiths, Rt, Hon. J. (Llanelly)

    Noel-Baker, Capt. F E. (Brentford)

    Blyten, W. R.

    Gruffyd, Prof. W. J

    Noel-Buxton, Lady

    Boardman, H.

    Gunter, R. J.

    O'Brien, T.

    Bowden, Flg.-Offr. H. W.

    Guy, W. H.

    Oliver, G. H

    Bowles, F G (Nuneaton)

    Haire, John E. (Wycombe)

    Orbach, M

    Braddock, Mrs. E. M. (L'pl, Exch'ge)

    Hale, Leslie

    Paget, R. T.

    Braddock, T. (Mitcham)

    Hall, W. G.

    Paling, Rt. Hon. Wilfred (Wentwortn)

    Bramall, Major E. A.

    Hamilton, Lieut.-Col. R

    Paling Will T. (Dewsbury)

    Brook, D. (Halifax)

    Hannan, W. (Maryhill)

    Palmer, A. M. F.

    Brown, George (Belper)

    Hastings, Dr Somerville

    Pargiter, G. A

    Brown, T. J. (Ince)

    Henderson, A. (Kingswinford)

    Paton, Mrs. F. (Rushcliffe)

    Bruce, Maj D. W. T.

    Hewitson, Capt. M.

    Paton, J. (Norwich)

    Buchanan, G.

    Hicks, G.

    Pearson, A.

    Burke, W. A.

    Holman, P.

    Peart, Capt. T. F.

    Butler, H. W (Hackney, S.)

    Holmes, H. E. (Hemsworth)

    Platts-Mills, J. F. F.

    Byers, Frank

    House, G.

    Poole, Major Cecil (Lichfleld)

    Callaghan, James

    Hoy, J.

    Porter, E. (Warrington)

    Carmichael, James

    Hudson, J H. (Ealing, W.)

    Porter, G. (Leeds)

    Castle, Mrs. B. A

    Hughes, Hector (Aberdeen, N.)

    Proctor, W. T

    Chamberlain, R. A.

    Hughes, H. D (W'lverh'pton, W.)

    Pryde, D. J.

    Champion, A. J.

    Hutchinson, H. L. (Rusholme)

    Pursey, Cmdr. H

    Chater, D.

    Hynd, H. (Hackney, C.)

    Randall, H. E

    Chetwynd, G. R

    Irving, W. J.

    Ranger, J

    Clitherow, Dr. R

    Isaacs, Rt. Hon. G. A

    Rees-Williams, D. R

    Cobb, F A

    Janner, B.

    Reid, T. (Swindon)

    Cocks, F. S

    Jay, D. P. T.

    Ridealgh, Mrs. M

    Collick, P.

    Jeger, G (Winchester)

    Robens, A

    Collindridge, F.

    Jeger, Dr. S. W. (St. Pancras, S )

    Roberts, Emrys (Merioneth)

    Collins, V J.

    Jones, D T (Hartlepools)

    Roberts, W. (Cumberland, N.)

    Colman, Miss G. M.

    Jones, P. Asterley (Hitchin)

    Robertson, J. J. (Berwick)

    Comyns, Dr. L.

    Keenan, W.

    Ross, William (Kilmarnock)

    Cook, T. F.

    Kendall, W. D

    Royle, C.

    Cooper, Wing-Comdr. G

    Key, C. W.

    Sargood, R.

    Corlett, Dr J.

    King, E. M

    Scott-Elliot, W

    Crawley, A.

    Kinley, J.

    Segal, Dr. S.

    Crossman, R H. S

    Lang, G

    Shackleton, Wing.-Cdr E. A. A

    Daggar, G

    Lee, F. (Hulme)

    Sharp, Granville

    Daines, P.

    Lee, Miss J. (Cannock)

    Shawcross, C. N. (Widnes)

    Davies, Clement (Montgomery)

    Lewis, T (Southampton)

    Shawcross, Rt. Hn. Sir H. (St. Helens)

    Davies, Edward (Burslem)

    Lindgren, G. S.

    Shinwell, Rt. Hon. E.

    Davies, Ernest (Enfield)

    Lindsay, K. M. (Comb'd Eng. Univ.)

    Silverman, J. (Erdington)

    Davies, Harold (Leek)

    Lipson, D L,

    Silverman, S. S (Nelson)

    Davies, Hadyn (St. Pancras, S.W.)

    Lipton, Lt.-Col. M

    Simmons, C. J.

    Davies, R. J. (Westhoughton)

    Logan, D. G.

    Skeffington-Lodge. T C

    Davies, S. O. (Merthyr)

    Longden, F.

    Skinnard, F. W.

    Deer, G.

    Lyne, A. W.

    Smith, C. (Colchester)

    Delargy, Captain H. J

    McAllister, G.

    Smith, Ellis (Stoke)

    Diamond, J.

    McEntee V. La T

    Smith, S. H. (Hull, S.W.)

    Dobbie, W.

    McGhee, H. G

    Snow, Capt. J. W

    Donovan, T.

    McGovern, J.

    Sorensen, R. W

    Driberg, T. E. N.

    Mack, J. D.

    Soskice, Maj. Sir F

    Dumpleton, C. W

    McKay, J. (Wallsend)

    Sparks, J. A.

    Durbin, E. F. M.

    Mackay, R. W G. (Hull, N.W.)

    Stamford, W

    Ede, Rt Hon J. C.

    McKinlay, A. S.

    Steele, T.

    Edelman, M.

    Maclean, N. (Govan)

    Stephen, C.

    Edwards, A (Middlesbrough, E.)

    McLeavy, F.

    Stewart, Michael (Fulham, E.)

    Edwards, N. (Caerphilly)

    Macpherson, T. (Romford)

    Stokes, R R.

    Edwards, W. J. (Whitechapel)

    Mallalieu, J. P. W

    Strauss, G. R (Lambeth, N.)

    Evans, E. (Lowestoft)

    Mann, Mrs J.

    Stross, Dr. B

    Evans, John (Ogmore)

    Manning, C (Camberwell, N.)

    Stubbs, A. E.

    Ewart, R.

    Manning, Mrs. L. (Epping)

    Swingler, S.

    Fletcher, E G M. (Islington, E.)

    Marshall, F. (Brightside)

    Symonds, A. L.

    Follick, M.

    Mathers, G

    Taylor, H. B. (Mansfield)

    Foot, M. M

    Medland, H. M.

    Taylor, R. J. (Morpeth)

    266

    267

    Taylor, Dr. S. (Barnet)

    Walkden, E.

    Williamson, T.

    Thomas, D. E. (Aberdare)

    Walker, G. H.

    Willis, E.

    Thomson, Rt. Hon. G. R. (Ed'b'gh, E.)

    Wallace, G. D. (Chislehurst)

    Wills, Mrs. E. A.

    Thorneycroft, Harry (Clayton)

    Warbey, W. N.

    Wilson, J. H.

    Thurtle, E.

    Watkins, T. E.

    Wise, Major F. J.

    Tiffany, S.

    Wells, P. L. (Faversham)

    Woodburn, A.

    Titterington, M. F.

    Wells, W. T (Walsall)

    Woods, G. S.

    Tolley, L.

    West, D. G.

    Yates, V. F.

    Tomlinson, Rt. Hon. G.

    Wilcock, Group-Capt. C. A. B.

    Young, Sir R. (Newton)

    Turner-Samuels, M.

    Wilkes, L.

    Zilliacus, K.

    Ungoed-Thomas, L.

    Wilkins, W A.

    Usborne, Henry

    Willey, F. T. (Sunderland)

    TELLERS FOR THE NOES:

    Vernon, Maj. W. F.

    Willey, O. G. (Cleveland)

    Mr. Joseph Henderson and

    Viant, S. P.

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

    Mr. Popplewell.

    Wadsworth, G

    Williams, W. R. (Heston)

    Original Question put, and agreed to.

    Resolved:
    "That a Supplementary sum, not exceeding£10, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Ministry of Civil Aviation."

    MINISTRY OF HEALTH
    Motion made, and Question proposed,
    "That a Supplementary sum, not exceeding £750,000, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Ministry of Health, including grants and other expenses in connection with housing, certain other grants to local authorities, etc., a supplemental grant in respect of medical benefit, salaries and expenses of the Local Government Boundary Commission, a grant in aid of the National Radium Trust, a grant in aid of the Women's Voluntary Services; and other services."
    7.30 p.m.
    The Minister of Works (Mr. Key): It is my duty to present this Supplementary Estimate for the Ministry of Health, and in so doing I will try to deal, very shortly, with the items involved. There is, first, the question of additional payments into the Building Materials and Housing Fund under the Building Materials and Housing Act, 1945. The purpose of this fund is to meet the expenses of the Minister of Works in purchasing building materials and equipment and to arrange for the production of the necessary goods. Under Section 3 of that Act, the Minister of Health Is empowered to arrange with the Minister of Works that where the cost of a non-traditional house, built out of materials provided by the Ministry of Works, exceeds the cost of the same sized traditional house then the price to be charged to the local authority is to be reduced, and the Minister of Health has to pay into the funds of the Ministry of Works the amount by which the local authority's
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    costs are reduced. The houses involved in the original Estimate were of a Swedish type, but since then this procedure has been applied to houses of the Howard type, and to meet the additional costs for those Swedish houses, together with the Howard houses, £800,000 is required.
    The second item deals with certain nurseries run by local authorities. There was a big development, in wartime, of nurseries run by local authorities, the whole cost of which was, during that time and up to 31st March, 1946, met out of national funds. Afterwards, they were carried on by the local authorities. Because of the extra cost involved it was felt wise that there should be applied to these nurseries, run by welfare authorities, the same sort of grant as was provided to educational authorities for running nursery schools. The increase in the amount that is required for this arises from the greater number of such nurseries than was anticipated when the original Estimate was made. The additional sum required is £ 300,000.
    Mr. R. S. Hudson: Can the right hon. Gentleman give us the number of children?
    Mr. Key: Offhand, I cannot give the number of nurseries or children involved, but they are considerably more than was anticipated when we made the original Estimate.
    The next item, dealing with the preliminary expenses of statutory bodies under the National Health Service, concerns a new service. The sum required is for preliminary expenses, between now and the end of this financial year, in connection with the bodies that we are now busy setting up, such as the Central Health Services Council, the Regional Hospital Boards and the Boards of Governors of teaching hospitals. The expenses will be largely to meet loss of remunerative time, travelling, and sub-

    269
    sistence, as well as for some salaries in connection with some of those boards. The next item is for a new service, and arises out of the decision, after negotiations with the Insurance Acts Committee of the British Medical Association, to make an increase in the capitation fee, under the National Health Insurance Scheme, from 12s. 6d. to 15s. 6d. as from 1st. January, 1946.
    This sum cannot be provided out of National Health Insurance funds and so it is necessary for it to be provided by the Exchequer. The estimated sum required is £4 million. Then there are certain miscellaneous services which I think I ought to explain. First, there is one in connection with emergency housing. This is a considerable increase on the original Estimate, and arises from a number of causes. One is the acceleration of the rate of receipt and settlement of claims over the years before 1st April, 1946. Attention was drawn by the Public Accounts Committee, particularly in their first Report for the 1945–46 Session, to the delay of local authorities in submitting their claims. Since then there has been a considerable speeding up of submission of accounts by local authorities, and that adds considerably to the amount of money that will be necessary. There has also been an expansion of housing requirements by the requisitioning programme being applied not only for those who were bombed out, but also for those who were inadequately housed. Another addition arises from the extension of accommodation by way of emergency provision in the camps that have been taken over by local authorities. As against this, I want to draw attention to an offset by the additional receipts from this, which amount to a considerable sum, namely, £1,715,000.
    Next, we come to an additional sum necessary because of increases in the salaries of nurses. This arises because there has been agreement whereby 50 per cent. of the extra cost falling upon local authorities and other bodies for increases in salaries, following the recommendations of the Rushcliffe Report, should be provided out of national funds. Increases were made on 1st August, 1941, and 1st April, 1943—which, of course, are not included in this Estimate—and this additional sum is required to meet the increases which will come into effect from 1st January, 1946. The next item deals
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    with wartime nurseries, which came to an end on 31st March, 1946, but which were continued after that date by local authorities. The increase in the original Estimate has been made necessary, again, by the acceleration on the part of the local authorities in the submission of their accounts in that respect.
    As a set off against many of these subheadings, I would draw attention to the anticipated savings given in E1, F1 and G14 on page 35. The first is as a result of Section 3 of the Housing (Temporary Accommodation) Act, 1944, in respect of which the saving of the whole of the original provision of £300,000 is anticipated. It is very unlikely that the local authorities will be in a position to submit their accounts in this connection because of the high cost of the land used for temporary accommodation, and so that item, so far as this year's accounts are concerned, will be saved. It will fall, of course, to be met in next year's accounts.
    There is also a saving in connection with the grants towards housing expenses under the Housing Acts. This is a considerable saving of £7,700,000, and results from two items. The first item is a saving of about £700,000 in respect of the actual subsidy that was payable under the various Sections of the Housing (Financial and Miscellaneous Provisions) Act, 1946, due to the fact that the number of houses completed was not so great as was anticipated when the original estimates were submitted. The second item is of much greater extent—£7 million under Section 17 of the same Act by which the Ministry of Health were enabled to make a contribution to the cost of non-traditional houses over and above what would have been the cost of traditional houses of the same size.
    The Deputy-Chairman (Mr. Hubert Beaumont): Did I hear the Minister refer to savings?
    Mr. Key indicated assent.
    The Deputy-Chairman: We cannot discuss savings, but only expenditure.
    Mr. R. S. Hudson: As you, Mr. Beaumont, were kind enough to allow the Minister of Works—whom we should like to congratulate on his new appointment—to deal with the first point, I presume you will be kind enough to allow us to comment on that so far as he went.
    The Deputy-Chairman: I have only just awakened to the fact that the Minister was discussing savings. That does not mean that I shall not anticipate and prevent further references much more quickly.
    Mr. Key: I am sorry, Mr. Beaumont, that my lack of the necessary knowledge has led me astray. I think, therefore, that I have come to the end of what it would be safe for me to say. The effect of all this is that it reduces the necessary amount of the Supplementary Estimate to£750,000.
    Mr. R. S. Hudson: On a point of Order, Mr. Beaumont. I am not sure whether the right hon. Gentleman did not cut his speech a little unnecessarily as a result of your calling him to Order. I think that I am correct in saying that, although it is out of Order to discuss anticipated savings under subheadings E1, F1, and G14, it is not out of Order to discuss Z—Appropriations-in-aid. The House will observe that there is a considerable item of increase in appropriations-in-aid. The right hon. Gentleman mentioned part of it in his speech, amounting to £2,700,000.
    The Deputy-Chairman: The right hon. Gentleman will not be in Order in discussing appropriations-in-aid.
    Mr. R. S. Hudson: I understood, Mr. Beaumont, with all respect, that it has always been definitely out of Order to anticipate savings, but I have it on extremely good authority that it is in Order to discuss appropriations-in-aid.
    The Deputy-Chairman: It is not in Order to discuss appropriations-in-aid.
    Mr. Beechman: I am sure that the Committee is very much obliged to the Minister for his explanation, and I should like to join in congratulating him on his new appointment. I am sure that any post he fills will be a key post, and that he will do very well in it. With regard to the item "Nurses, etc., grants in respect of salaries increases," I happened to be working at the Ministry of Health—
    7.45 p.m.
    The Deputy-Chairman: I am not calling the hon. Member to Order, and I regret having to interrupt his speech. I have now before me the reference with
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    regard to discussion of appropriations-in-aid. It is definitely laid down in the Manual of Procedure:
    "The Committee of Supply can reduce estimates of expenditure, i.e., can refuse to grant as much as the Crown asks for, but cannot reduce or discuss the application of appropriations-in-aid, these not being sums demanded by the Crown but sums, actual or estimated, received from other sources."
    Definitely, appropriations-in-aid cannot be debated.
    Mr. Beechman: I was dealing with the estimate in respect of nurses' salaries, and I was mentioning that I was myself working at the Ministry of Health when this matter was put before the Rushcliffe Committee. I am sure that everyone in this House is very glad that nurses' salaries have gone up, because theirs is such an important mission, but I should like to know what is the meaning of "etc." I should like to be informed if that means that attention has been paid to the conditions under which nurses live, and that something has been done also in respect of their accommodation; or does it mean that, in addition, the right hon. Gentleman has found extra nurses, because they are badly needed, as we know, in tuberculosis establishments in particular? I should also like to know whether this covers foreigners, who are coming to this country to work as nurses, especially in tuberculosis establishments, about which we are all so concerned? Do these symbols cover domestic workers in hospitals and other such institutions, because the shortage of domestic workers has proved, and is proving, a most serious burden on the existing nursing staffs, and, in many cases, upon the matrons.
    Another matter listed is "Emergency housing, etc., accommodation" I should like to know how much money is still being spent on looking after war evacuees. I raised this matter in the House before, and gave personal instances. In an hotel in St. Ives there are four or five families of war evacuees all of whom except one want to get back to their home districts, and I should like to have some knowledge as to how far money is being expended on people who are evacuees from the war, and who are so anxious to get back to their home districts. I know these are cases where their houses in London have been bombed, but they want to get back near London. They will be caught up in the next war if they are left where

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    they are much longer. It is most unfair to the people who own these hotels, and which could be used for local purposes. In regard to the medical services in general, I should like to know whether these Estimates cover our expenditure on radiography for tuberculosis, because I know that this is a matter on which the health of the country greatly depends, and in which great interest has been taken by our most excellent Chief Medical Officer, to whom we all ought to be very grateful indeed.
    Mr. Key: With regard to the first question, the item is covered only when dealing with the salaries of the real nursing members of the staff of the hospital from the matron down, through the staff nurse, the ward nurse, to the probationer, but it does not cover any of the domestic staff, and certainly it is not included in connection with the provision of actual accommodation by the hospital authorities, because power is only given to pay 50 per cent. of the additional expense of the increase in the nursing salaries. With regard to the item dealing with housing, that only covers the requisitioning of houses and I am afraid does not cover war evacuees. Therefore, I am not in a position to deal with evacuees, because it does not come under this item. In the same way there is no item here which deals with materials and equipment for hospitals. Therefore, I have nothing to say in that connection.
    Mr. Marples: In connection with the housing increase from £1 million to £1,800,000 under item F3, payments into the Building Materials and Housing Fund, there are one or two points I should like to ask the new Minister of Works, but firstly as a humble back-bencher, I should like to add my congratulations on his new appointment. On the Building Materials and Housing Account 1945–46, there is a report by the Comptroller and Auditor-General, which in some respects is a little disturbing. As the Minister is now asking for more money for this Fund, there are two explanations I should like to seek. On page 5 of this report it is stated that, in May, 1945, the Ministry of Works, with Treasury authority, issued instructions to a contractor, who was the promoter of a certain type of house, to proceed with the manufacture of 3,400 of these houses. This was when the Coalition
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    Government were in power, but in November, 1945, when another Government were in power instructions were given by the Ministry of Works for a contract for 2,400 houses. They altered the original contract, and on my reading of it they altered it without Treasury consent.
    In February, 1946, an inquiry was made which revealed that only 40 houses had been completed. Therefore, a further alteration to the amended contract was made, this time with Treasury consent. Now the original contract was £1,272 per house, but owing to this series of alterations, the Ministry of Works was obliged to make the next contract direct with the sub-contractor, and a new figure of £1,515 was fixed. This showed a difference of £243 per house. The report of the Comptroller and Auditor-General says that part of the fault lay in issuing orders without Treasury consent and also amending them. Also on page 6 it says—and these are the actual words:
    "It appears that some part of the increased cost is due to the modifications ordered by the Ministry of Works."
    Now one of the greatest causes of increased building costs lies in making modificiations to an agreed specification, and I should like to put two specific questions to the new Minister of Works. The first one is, why, if the Ministry of Works originally approved the specification, was it necessary to modify that specification; and, secondly, how much of the increased cost is due to the Ministry of Works altering this original specification?
    Mr. Key: Is there not some misconception here? These are Ministry of Health Estimates, not Ministry of Works Estimates. The point should be raised on the Ministry of Works Estimates. We are merely considering the payments to be made by the Ministry of Health for houses provided. I am not in a position to answer any question about the increase in the specifications. We are merely dealing with the payments into the Fund on behalf of the Ministry of Health.
    Mr. Marples: The Minister is asking for an additional £800,000 for payment into the Building Materials and Housing Fund under the Building Materials and Housing Act. He is asking for more money for this particular Fund which is being discussed, and I submit it is in Order to discuss that Fund for which extra money is being sought.
    Mr. Key: This increased Estimate. is for two types of house. The first is the Swedish timber house, and the other is the Howard house of which a definitely limited number have been ordered and no more. I am not dealing with any other type of house, which is being provided by the Ministry of Works and these two and only these two are in the Estimate.
    Mr. R. S. Hudson: I am quite aware of that, but the Report presented to the House on 19th December last, from which the hon. Member for Wallasey (Mr. Marples) has quoted, referred specifically to these two types of houses which the new Minister has just mentioned. Paragraph 2 refers to the Swedish timber house and paragraph 3 refers to what I understand he calls the Howard house. He is asking for an increase over the original Estimate. The original Estimate was for £1 million to cover these two kinds of houses, and now he is asking for £1,800,000 to cover them. I honestly think we are entitled to ask him why he is asking for £1,800,000 instead of £1 million, in respect of the two sets of houses which my hon. Friend has mentioned.
    Mr. Key: The explanation I give of that is that, first, there is a slight increase in the cost of Swedish houses over and above the estimate originally submitted. The other part of the extra cost is due to the inclusion of the cost of the Howard house since the first estimates were made. It is something like £ 1,380, and this is now included in the Supplementary Estimate.
    8.0 p.m.
    Mr. Marples: I am much obliged to the right hon. Gentleman, but the original contract price was £1,272 per house and the actual amount paid was£1,515, which is an increase of £243 per house. How much of that increase was due to modifications ordered by the Ministry? According to the report of the Comptroller and Auditor-General, it appears that some part of the increased cost is due to modifications that were ordered. How much of the increased cost was due to modifications which in themselves may or may not have been desirable? What were those modifications? Did they improve the house or increase its size?
    Mr. Key: I must explain that I am speaking now as Parliamentary Secretary to the Ministry of Health, and dealing
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    only with those things for which the Ministry of Health are responsible. The questions that have been put to me concern the activities of the Ministry of Works. I have not yet had an opportunity of taking over my functions at the Ministry of Works, or making myself familiar with the details that have been put to me in questions this evening. It may be that at a later stage I shall be able to give answers, but at present I cannot do so; and in any case, the questions do not arise on this Estimate, because they do not affect matters arising from it.
    Mr. R. S. Hudson: I do not know, Sir Charles, whether I ought to seek to move a Motion "That the Chairman do report Progress, and ask leave to sit again." When Section (3) of the Building Materials and Housing Act was passing through the House, there was a long Debate in the course of which grave objections were raised from this side concerning the difficulty likely to arise over the House finding out exactly the cost of each of these houses. As I understand it, the argument put forward by the Minister is that, in his capacity as Parliamentary Secretary to the Ministry of Health, he is not responsible in any way for any increased cost arising out of action taken by the Ministry of Works. All he did was to order the houses. He now suggests that the Ministry of Health having ordered the houses from the Ministry of Works, that is the end of their responsibility, and all they have to do is to pay the bill. Surely, that is not a situation which can be tolerated by the Committee, especially as Section (3) of the Act enables the Minister of Health to arrange with the Minister of Works for the provision of these houses and the Minister of Health, surely, share with the Minister of Works responsibility for them.
    Mr. Key: The Ministry of Works provide the house, and the local authority has to meet the cost of the house and to pay the Ministry of Works for it, but where the cost of the house would be greater to the local authority than the cost of a traditional house of similar size, the Ministry of Health have to pay to the Ministry of Works the extra sum. All I am concerned about is the payment of the extra cost, and questions of the cause of the extra cost should be directed to the Minister of Works, and not to the Minister of Health.
    Mr. Marples: On a point of Order, Sir Charles. Is it not clear from the Fifth Report of the Select Committee on Estimates that any sums paid out under Section (3) of the Act are definitely under the Ministry of Health Vote, subhead F.3? The question I am putting is how the money has been expended. Surely, it is in Order to discuss that. I do not want to be unfair to the Minister on his first day as Minister of Works, but I think the Committee is entitled to have an explanation.
    Mr. Key: This is not my first day; it is my last day at the Ministry of Health, and I am speaking now as the Parliamentary Secretary to the Ministry of Health.
    The Temporary Chairman (Colonel Sir Charles MacAndrew): Perhaps I can simplify the matter. The Minister is responsible for the Estimate, and the hon. Member for Wallasey (Mr. Marples) was asking for an explanation of why the original amount was not enough and another £800,000 was required. He is entitled to have that information.
    Mr. Key: Yes, Sir Charles, and I have given it. First, there was a small increase in the cost of the Swedish house, of which there are something like 2,500; and secondly, there were brought into this Estimate 1,380 Howard houses which had not been included before. Those two items account for the increase of £800,000 in the Estimate.
    Mr. Lipson: Further to the point of Order, Sir Charles, surely the Committee is entitled to know why the Ministry of Health agreed to the higher price for these houses, because it is that extra cost which is, in part, the justification for the increase in the Estimates. Surely, the Ministry of Health do not blindly pay the bill when it is presented by the Ministry of Works? If the bill is in excess of what was anticipated in the past, surely the Ministry of Health ask why more has to be paid for the houses than was originally intended? I submit that the Committee is entitled to have an explanation of that matter.
    Mr. Key: There was a small increase in the cost of the Swedish house—it rose in respect of transportation and erection —over and above what had been estimated.
    Mr. R. S. Hudson: How much?
    Mr. Key: I cannot give the figure.
    Mr. Hudson: Why not?
    Mr. Key: I have not got it.
    Mr. Hudson: Why?
    Mr. Key: It is not in my possession. I will ask for it and provide it. With regard to the Howard house, it is not a question of increased cost, but 1,380 Howard houses were brought into the Estimate that were not originally included.
    Mr. Hudson: Even supposing that to be the case, surely the fact that extra houses were brought in does not stop us asking how the cost is made up, or why the cost is bigger than was anticipated. We have a report by the Comptroller and Auditor-General calling attention to certain short-comings, as we think. He does not do that for nothing. I submit that it is for the Minister, in explaining his Estimates, to explain why these things have arisen. The Minister cannot get away with it by saying that he has not the information.
    Mr. Key: What I am saying is that the houses referred to in that report are not the houses referred to in the Supplementary Estimate. The only two types of houses dealt with here are the Swedish house and the Howard house.
    Mr. Hudson: The Minister mentioned a figure of 1,380. It is precisely the 1,380 I am talking about which are included in the report of the Comptroller and Auditor-General, who stated that the Ministry decided to cancel the original contract and to enter into a contract with three subcontractors for the manufacture of only 1,380 houses as against 2,400 which it had originally proposed. Then the Comptroller and Auditor-General, in his report, goes on to call attention to the fact, as we think, that modifications were made in the original specification, without the consent of the Treasury, and that they led to increased charges. We are trying to get at the bottom of this matter and to press the hon. Gentleman for the reasons.
    Mr. Marples: Perhaps I may add to my right hon. Friend's questions to the Minister. The Minister's exact words now are that there was no increase. The actual words used by the Auditor-General are that there was a revision of the contract resulting in an increase—these are

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    the same houses that the Minister talked about—in the total cost of those houses. It is now estimated that the cost of these houses is £1,515 per house. Therefore the original estimate, of £1,272, was increased by £243 per house, which is an increase of nearly 20 per cent. That is a substantial increase in the cost of a house, and I am trying to find out from the hon. Gentleman why that increase was necessary.
    Part of the increase appears to have been due to modifications ordered by the Ministry of Works, according to the Auditor-General. If so, may we be told what the modifications were? Did they increase the size or the amenities of the houses? If so, how much per house did they cost? Did the Minister of Health or the Minister of Works ask for those modifications? The second question is, why did the Minister of Works order a revision of the contract without the Treasury being first asked? The Auditor-General goes into that point as well. I want an explanation from the Minister of this increase of £243 per house. Surely it is not unreasonable to ask for that explanation.
    Mr. Key: I still want to submit that the request should be made to the Minister of Works and not to the Minister of Health. The Minister of Health is not in a position to give an explanation of the details that gave rise to the increases in the cost of the houses provided by the Ministry of Works—not for the Ministry of Health but for the local authorities who took the type of house that the Ministry of Works provided. When the cost has been arrived at as a result of the activities of the Ministry of Works and it has been proved that the cost is over and above the cost of a similar-sized traditional house, the function of the Ministry of Health is to pay to the Ministry of Works that extra cost. Questions about the reasons for that extra cost should be directed to the Ministry of Works, and dealt with on the Estimates of the Ministry of Works and not on the Estimates of the Ministry of Health.
    Mr. R. S. Hudson: That explanation would be plausible, if we had an opportunity of cross-questioning the Minister of Works on this particular matter. We are not dealing with them today, nor do I think there would be any separate items
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    in the Ministry of Works Estimates on which we could ask these questions. The right hon. Gentleman, in his capacity as representing the Ministry of Health, is responsible for asking the Committee for additional money. We cannot ask the Minister of Works directly for this explanation, because his Estimate is not before us and I do not think this item would come into his Estimate. I was asking for your guidance, Sir Charles, as to whether we are not entitled to press this matter further. Look at the position in which we are placed. Here is the representative of the Ministry of Health asking for an additional Supplementary Estimate. Some of the details, at all events, are contained in this account of the Controller and Auditor-General. The Minister comes along and says that although he is asking for additional sums he is quite incapable of giving any answer to our questions.
    Mr. Key: I have not said that.
    Mr. Hudson: I asked the Minister the additional cost of the Swedish houses and the price of the Swedish houses. He said that he did not know why the cost was greater and that he did not know what the total numbers were.
    Mr. Key: Yes, I do. The number is 2,500.
    8.15 p.m.
    Mr. Hudson: Will the Minister please tell the Committee the total number of Swedish houses in this Estimate, how many more Swedish houses he actually got than he expected, and how much is being paid by his Department to the Ministry of Works in respect of each of the houses? Will he also say what he is going to pay to the Ministry of Works for the total number of 2,500 Swedish houses?
    Mr. Key: The total number of Swedish houses was 2,500; the number so far completed is 2,438. Between now, and 31st March, the order will be completed. The additional cost of the 2,500 houses involved is £124,000.
    Mr. Hudson: Does the Minister mean £124,000 per house?
    Mr. Key: What I have said is that, in the original Estimate, the 2,500 Swedish houses was estimated at £1 million. As the result of the increase in the costs of transport and assembly, those 2,500

    281
    Swedish houses will cost roughly another £124,000, or just under that sum. That is to say, that they will cost more than the £1 million included in the Estimate. The other part of the £800,000 increase is because of the inclusion in this Estimate of 1,380 of the Howard type of house.
    Mr. Marples: What has caused this increase in the cost of the Howard house? Why has it been increased. The cost was originally going to be £1,272, but the amount to be paid by the taxpayer is £1,515. That amounts to an increase of £243. Is that correct? If so, why has there been this 20 per cent. increase in the price of this type of house.
    Mr. Key: Again I must say that this is a matter for the Ministry of Works and not for the Ministry of Health. The Ministry of Health comes into this picture only when the house has been completed for the local authority by the Ministry of Works and when it has been proved, for whatever cause, that the cost is higher than the cost of a similar-sized traditional house that might have been provided by that local authority for whom the Howard type of house has been provided. Where that cost is greater, the money that the local authority will pay to the Ministry of Works is made up by the Ministry of Health. The Ministry of Works must be responsible for the, increased cost in the Howard house, and not the Ministry of Health, because the house is not provided for the Ministry of Health but for the local authority.
    Mr. Marples: The Minister is appearing before the Committee and is asking for extra money for these houses but he is not prepared to take the responsibility of giving to the Committee an explanation why he is asking for the money.
    Mr. Key: I come here on behalf of the Ministry of Health to say that we expect there may be 1,380 Howard houses provided by the Ministry of Works. The Ministry of Works inform us what they think the cost of these Howard houses will be, we estimate what would be the cost to the local authority of a traditional house of the same type, and therefore, since the Ministry of Works is asking for x, and the local authorities are providing y, we come here for an Estimate for x minus y in order to make up the total sum we have to pay.
    Mr. R. S. Hudson: It goes considerably further than that. All the evidence we have to go on at the present moment is in the report of the Comptroller and Auditor-General, and a rapid and not very detailed arithmetical sum which I have just done shows that the cost of these houses has increased not only as shown by the Auditor-General but, if the figure which the right hon. Gentleman has just mentioned for the difference between the original total of £1 million for the Swedish houses and the present total of £1,125,000 is right, he is now asking for £125,000 more for the Swedish houses. If that is taken from the £1,800,000, it leaves roughly £675,000, which is the contribution to be made by the Minister of Health to the Minister of Works for these 1,380 Howard houses. That looks very much as if the increase in the cost of these Howard houses is more than double the extremely big increase to which the Auditor-General called attention in his report of 19th December. Not only is the right hon. Gentleman asking for something new, but he is asking for something considerably bigger even than the figure to which the Auditor-General called attention, and which he by implication condemned. I venture to suggest that we are entitled to ask the Minister of Works to come and give an explanation.
    The Secretary of State for the Home Department (Mr. Ede): He is here.
    Mr. R. S. Hudson: I am most grateful to the right hon. Gentleman the Home Secretary for his help, but if he had been in his place the whole time he would have heard his right hon. Friend say that he was sitting there in his capacity as Parliamentary Secretary to the Minister of Health, not as Minister of Works. I, therefore, suggest quite seriously that this is a matter of great importance about which the House is entitled to be informed. We accept for the moment that he says these 1,380 have been added on, but we are entitled to know why they cost so very much more than the original estimate. I suggest, with all respect, that we are entitled to ask the right hon. Gentleman, in the course of the Debate which is bound to continue for a little time, either to send and get the information from his new Department and let us have it, or send for the Parliamentary Secretary, who is presumably aware of this. I think we are entitled to do that

    283
    and I hope the right hon. Gentleman will agree. I think he ought to. If he does not, with all respect, I shall seek to move to report Progress and ask leave to sit again, in order to call attention to the fact that we just cannot get the information we require.
    I beg to move, "That the Chairman do report Progress, and ask leave to sit again."
    Question put, "That the Chairman do report Progress, and ask leave to sit again."
    The Committee divided: Ayes, 88; Noes, 276.

    Division No. 73.]

    AYES.

    8.25 p.m.]

    Agnew, Cmdr. P. G.

    Headlam. Lieut.-Col. Rt. Hon. Sir C.

    Pickthorn, K.

    Amory, D. Heathcoat

    Hogg, Hon. Q.

    Prescott, Stanley

    Baldwin, A. E.

    Howard, Hon. A.

    Prior-Palmer, Brig. O

    Barlow, Sir J.

    Hudson, Rt. Hon. R. S. (Southport)

    Raikes, H. V.

    Beechman, N. A.

    Hurd, A.

    Rayner, Brig. R.

    Boles, Lt.-Col. D. C. (Wells)

    Jarvis, Sir J

    Reed, Sir S. (Aylesbury)

    Bower, N.

    Jennings, R.

    Renton, D.

    Buchan-Hepburn, P. G. T.

    Joynson-Hicks, Lt.-Cdr. Hon. L. W.

    Roberts, Maj. P. G. (Ecclecall)

    Butcher, H. W.

    Legge-Bourke, Maj. E. A. H.

    Ropner, Col. L.

    Challen, C.

    Lenox-Boyd, A. T.

    Scott, Lord W.

    Conant, Maj. R. J. E.

    Lindsay, M. (Solihull)

    Shephard, S. (Newark)

    Cooper-Key, E. M.

    Lipson, D. L.

    Shepherd, W. S. (Bucklow)

    Corbett, Lieut.-Col. U. (Ludlow)

    Lucas-Tooth, Sir H.

    Smiles, Lt.-Col. Sir W.

    Crosthwaite-Eyre, Col. O. E.

    Macdonald, Sir P. (I. of Wight)

    Smith, E. P. (Ashford)

    Digby, S. W.

    Maclay, Hon. J. S.

    Stoddart-Scott, Col. M.

    Dodds-Parker, A. D.

    Macpherson, Maj. N. (Dumfries)

    Strauss, H. G. (English Universities)

    Dower, E. L. G. (Caithness)

    Maitland, Comdr. J. W.

    Stuart, Rt. Hon. J. (Moray)

    Drayson, G B.

    Marningham-Buller, R. E.

    Taylor, C. S. (Eastbourne)

    Drewe, C.

    Marlowe, A. A. H.

    Thorneycroft, G. E. P. (Monmouth)

    Foster, J. G. (Northwich)

    Marples, A. E.

    Thornton-Kemsley, C. N.

    Fox, Sir G.

    Marshall, S. H. (Sutton)

    Thorp, Lt.-Col. R. A. F.

    Fyfe, Rt. Hon. Sir D. P. M

    Maude, J. C.

    Vane, W. M. F.

    Gage, C.

    Mellor, Sir J.

    Watt, Sir G. S. Harvie

    Glyn, Sir R.

    Molson, A. H. E.

    White, Sir D. (Fareham)

    Gomme-Duncan, Col. A. G.

    Morris-Jones, Sir H.

    White, J. B. (Canterbury)

    Grant, Lady

    Neven-Spence, Sir B.

    York, C.

    Grimston, R. V.

    Noble, Comdr. A. H. P

    Hannon, Sir P. (Mossley)

    Orr-Ewing, I. L.

    TELLERS FOR THE AYES:

    Hare, Hon. J. H. (Woodbridge)

    Osborne, C

    Mr. Studholme and

    Harvey, Air-Comdre. A. V.

    Peake, Rt. Hon. O

    Major Ramsay.

    Haughton, S. G.

    Peto, Brig. C. H. M.

    NOES.

    Adams, Richard (Balham)

    Champion, A. J.

    Edwards, N. (Caerphilly)

    Adams, W. T. (Hammersmith, South)

    Chetwynd, G. R.

    Edwards, W. J. (Whitechapel)

    Alpass, J. H.

    Clitherow, Dr. R.

    Evans, E. (Lowestoft)

    Anderson, A. (Motherwell)

    Cobb, F. A.

    Evans, John (Ogmore)

    Anderson, F. (Whitehaven)

    Coldrick, W

    Ewart, R.

    Attewell, H. C.

    Collick, P.

    Field, Capt W J.

    Austin, H. Lewis

    Collins, V. J.

    Fletcher, E G M. (Islington, E.)

    Awbery, S. S.

    Colman, Miss G. M.

    Follick, M.

    Ayles, W. H.

    Comyns, Dr. L.

    Foot, M. M.

    Ayrton Gould, Mrs. B.

    Cook, T. F.

    Forman, J. C.

    Bacon, Miss A.

    Cooper, Wing-Comdr. G.

    Foster, W. (Wigan)

    Baird, J.

    Corbet, Mrs. F. K. (Camb'well, N W.)

    Fraser, T. (Hamilton)

    Balfour, A.

    Corlett, Dr. J.

    Freeman, Peter (Newport)

    Barstow, P. G.

    Crossman, R. H. S

    Gaitskell, H. T. N.

    Bechervaise, A. E

    Daggar, G.

    Ganley, Mrs. C. S.

    Berry, H.

    Daines, P.

    Gibson, C. W.

    Blenkinsop, A.

    Davies, Clement (Montgomery)

    Gilzean, A.

    Blyton, W. R

    Davies, Edward (Burslem)

    Glanville, J. E. (Consett)

    Boardman, H

    Davies, Ernest (Enfield)

    Gooch, E. G.

    Bowden, Flg.-Offr. H. W.

    Davies, Harold (Leek)

    Goodrich, H. E.

    Bowles, F. G. (Nuneaton)

    Davies, Hadyn (St. Pancras, S.W.)

    Granville, E. (Eye)

    Braddock, Mrs. E. M. (L'pl, Exch'ge)

    Davies, R. J. (Westhoughton)

    Greenwood, Rt. Hon. A. (Wakefield)

    Braddock, T. (Mitcham)

    Davies, S. O. (Merthyr)

    Greenwood, A. W. J. (Heywood)

    Bramall, Major E. A.

    Deer, G.

    Grenfell, D. R.

    Brook, D. (Halifax)

    Delargy, Captain H. J.

    Grey C. F

    Brown, George (Belper)

    Diamond, J.

    Grierson, E.

    Brown, T. J. (Ince)

    Dobbie, W.

    Griffiths, D. (Rother Valley)

    Bruce, Maj. D. W. T.

    Dodds, N. N

    Griffiths, Rt. Hon. J. (Llanelly)

    Buchanan, G.

    Donovan, T.

    Griffiths, W D. (Moss Side)

    Burke, W. A.

    Driberg, T. E. N.

    Gunter, R. J.

    Butler, H. W. (Hackney, S.)

    Dumpleton, C. W.

    Guy, W. H.

    Byers, Frank

    Durbin, E. F. M.

    Haire, John E. (Wycombe)

    Callaghan, James

    Ede, Rt. Hon. J. C.

    Hale, Leslie

    Carmichael, James

    Edelman, M.

    Hall, W G.

    Chamberlain, R. A

    Edwards, A. (Middlesbrough, E.)

    Hamilton, Lieut.-Col. R.

    Hannan, W. (Maryhill)

    Mellish, R. J.

    Smith, C. (Colchester)

    Hastings, Dr. Somerville

    Middleton, Mrs. L.

    Smith, Ellis (Stoke)

    Henderson, A. (Kingswinford)

    Mikardo, Ian

    Smith, S. H. (Hull, S.W.)

    Henderson, Joseph (Ardwick)

    Mitchison, Maj. G. R.

    Sorensen, R. W.

    Herbison, Miss M.

    Moody, A. S.

    Soskice, Maj. Sir F.

    Hewitson, Capt. M.

    Morgan, Dr. H. B.

    Sparks, J. A.

    Hicks, G.

    Morley, R.

    Stamford, W,

    Holman, P.

    Morris, P. (Swansea, W.)

    Steele, T.

    Holmes, H. E. (Hemsworth)

    Mort, D. L.

    Stephen, C.

    House, G.

    Moyle, A.

    Stewart, Michael (Fulham, E.)

    Hoy, J.

    Murray, J. D.

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

    Hudson, J. H. (Ealing, W.)

    Nally, W.

    Stross, Dr. B.

    Hughes, Hector (Aberdeen, N.)

    Naylor, T. E.

    Swingler, S.

    Hughes, H. D. (W'lverh'pton, W.)

    Neal, H. (Claycross)

    Symonds, A. L.

    Hutchinson, H. L. (Rusholme)

    Nichol, Mrs. M. E. (Bradford, N.)

    Taylor, H. B. (Mansfield)

    Hynd, H. (Hackney, C.)

    Nicholls, H. R. (Stratford)

    Taylor, R. J, (Morpeth)

    Irving, W. J.

    Noel-Buxton, Lady

    Taylor, Dr. S. (Barnet)

    Isaacs, Rt, Hon. G. A.

    O'Brien, T.

    Thomas, D. E. (Aberdare)

    Janner, B.

    Oldfield, W. H.

    Thomas, I. O. (Wrekin)

    Jeger, G. (Winchester)

    Oliver, G. H.

    Thomson, Rt. Hon. G. R. (Ed'b'gh, E.)

    Jeger, Dr. S. W (St. Pancras, S.E.)

    Orbach, M.

    Thorneycroft, Harry (Clayton)

    Jones, Rt. Hon. A. C. (Shipley)

    Paget, R. T.

    Thurtle, E.

    Jones, D. T. (Hartlepools)

    Paling, Rt. Hon. Wilfred (Wentworth)

    Tiffany, S.

    Jones, P. Asterley (Hitchin)

    Paling, Will T. (Dewsbury)

    Titterington, M. F.

    Keenan, W.

    Pargiter, G. A.

    Tolley, L.

    Kendall, W D.

    Paton, Mrs. F. (Rushcliffe)

    Tomlinson, Rt. Hon. G.

    Key, C. W.

    Paton, J. (Norwich)

    Ungoed-Thomas, L.

    King, E. M.

    Pearson, A.

    Usborne, Henry

    Kinley, J.

    Peart, Capt. T. F.

    Vernon, Maj. W. F.

    Lang, G.

    Plans-Mills, J. F. F.

    Viant, S. P.

    Lee, F. (Hulme)

    Poole, Major Cecil (Lichfield)

    Wadsworth, G.

    Lee, Miss J. (Cannook)

    Porter, E. (Warrington)

    Walkden, E.

    Lewis, A. W. J. (Upton)

    Porter, G. (Leeds)

    Walker, G, H.

    Lewis, T. (Southampton)

    Price, M. Philips

    Wallace, G. D. (Chislehurst)

    Lindgren, G. S.

    Proctor, W. T.

    Warbey, W. N.

    Lindsay, K. M. (Comb'd Eng. Univ.)

    Pryde, D. J.

    Wells, W. T. (Walsall)

    Lipton, Lt.-Col. M.

    Pursey, Cmdr. H.

    West, D. G.

    Logan, D. G.

    Randall, H. E.

    Whiteley, Rt. Hon. W.

    Longden, F.

    Ranger, J.

    Wigg, Col. G. E.

    Lyne, A. W.

    Rees-Williams, D. R.

    Wilcock, Group-Capt. C. A. B.

    McAllister, G.

    Reid, T. (Swindon)

    Wilkes, L.

    McEntee, V. La T.

    Ridealgh, Mrs. M.

    Wilkins, W. A.

    McGhee, H. G.

    Robens, A.

    Willey, O. G. (Cleveland)

    McGovern, J.

    Roberts, Emrys (Merioneth)

    Williams, W. R. (Heston)

    Mack, J. D.

    Roberts, W. (Cumberland, N.)

    Williamson, T.

    McKay, J. (Wallsend)

    Robertson, J. J. (Berwick)

    Willis, E.

    Mackay, R. W. G. (Hull, N.W.)

    Ross, William (Kilmarnock)

    Wills, Mrs. E. A.

    McKinlay, A. S.

    Sargood, R.

    Wilmot, Rt. Hon. J.

    McLeavy, F.

    Scott-Elliot, W.

    Wilson, J. H.

    Macpherson, T. (Romford)

    Segal, Dr. S.

    Wise, Major F. J.

    Mallalieu, J. P. W.

    Shackleton, Wing.-Cdr. E. A. A.

    Woodburn, A.

    Mann, Mrs. J.

    Sharp, Granville

    Woods, G. S.

    Manning, C. (Camberwell, N.)

    Shawcross, C. N. (Widnes)

    Yates, V. F.

    Manning, Mrs. L (Epping)

    Shawcross, Rt. Hn. Sir H. (St. Helens)

    Young, Sir R. (Newton)

    Marquand, H A.

    Silverman, S. S. (Nelson)

    Zilliacus, K.

    Marshall, F. (Brightside)

    Simmons, C. J.

    Mathers, G.

    Skeffington-Lodge, T. C

    TELLERS FOR THE NOES:

    Medland, H. M.

    Skinnard, F. W.

    Mr. Collindridge and

    Mr. Popplewell.

    Question put, and agreed to.

    Original Question again proposed,
    "That a Supplementary sum, not exceeding £750,000, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Ministry of Health, including grants and other expenses in connection with housing, certain other grants to local authorities, etc., a supplemental grant in respect of medical benefit, salaries and expenses of the Local Government Boundary Commission, a grant in aid of the National Radium Trust, a grant in aid of the Women's Voluntary Services; and other services."
    8.35 p.m.
    Mr. Marples: Before the Question is put, there are one or two more queries I should like to address to the right hon. Gentleman, and this time perhaps he will give
    286
    the Committee some explanation of why he is asking for an increased sum of money. This all has to do with the Building Fund. In the fifth Report from the Select Committee on Estimates it is stated, on page eight, that the £1 million which was the original estimate would cover the extra cost of 2,500 houses. That is the difference between a non-traditional type of house and a traditional type, and amounts to £400 a house.
    It also says on the same page of that Report that the cost of each traditional house is £1,250, and if the £400 extra is added to that figure, the price per non-traditional house, according to the estimate, becomes £1,650. The question I want to ask the right hon. Gentleman is,

    287
    if in the original £1 million which was asked for, the total cost of a non-traditional house came to £1,650, what will be the cost of a house when the extra £800,000 he is asking for today is allowed for? Is the right hon. Gentleman satisfied that £1,250, really represents the cost of a traditional house as stated in the report of the Committee? I would be very grateful if he would reply.
    Sir Hugh Lucas-Tooth: The questions I desire to ask arise under the heading, "Preliminary expenses of statutory bodies." As I understand it, this section of this Estimate refers to expenses which have already been incurred or will be incurred before the end of the year in connection with the National Health Service Act which was passed last November. The total amount expended so far appears to be on the small side, and the Parliamentary Secretary gave no explanation as to the exact purposes on which this sum had been expended. It may be that progress has been very slow indeed. Under Parts I and II of the National Health Service Act, the only bodies which can so far have been affected by the estimate are the Central Health Service Council, possibly the standing advisory committees, and, of course, the regional boards. I would like some statement as to what progress has been made with any of these bodies. It is a matter of great interest not only to the Members of this Committee, but to the whole country, to know what progress is being made under the provisions of that Act, and we would like to know on which particular bodies these expenses have been incurred and for what precise purpose. How many of these bodies have actually met as bodies? Has anyone so far been nominated? If no one has yet been nominated, how has the sum of £5,000 been expended? Those are questions to which we would like answers at the present stage.
    In the course of his remarks, the right hon. Gentleman spoke of travelling and salaries, but he did not specify who had been doing the travelling and who would receive the salaries. If this travelling is simply travelling by officials of his Department, it seems to be excessive for the results so far visible. I would like to know, also, who has been receiving the salaries, if any of this sum has been expended on salaries in this connection. I
    288
    think we are entitled to ask for an explanation of that item. Then I would like some explanation of "W.3. Emergency Housing, etc. Accommodation." Again, the right hon. Gentleman gave a brief mention to that item, and I think he suggested that it was incurred in some respect by reason of expenditure on camps, and other places taken over from the Services, for housing those who cannot, unfortunately, be provided with other and better accommodation. Does that item include any figure in respect of the episode which recently received a great deal of publicity, when squatters went into various houses in London and elsewhere? Will he say whether any part of this item includes expenses incurred by his Department, either to put right houses that suffered at that time, or for modifying houses or otherwise in connection with the squatters?
    Mr. Key: In reply to the hon. Member for Wallasey (Mr. Marples) I said that the additional cost as far as the Swedish houses were concerned was roughly £125,000. That covered the 2,500. Taking the average, the increased cost of the Swedish house will be £50 per house. That, of course, is only the average, because the additional costs will vary according to the difficulties of transport and erection on given sites, but that is an increase of £50 over the estimated cost when the original estimates were submitted.
    With regard to the questions asked by the hon. Member for South Hendon (Sir H. Lucas-Tooth), I must have failed very much in my explanation, or the hon. Gentleman cannot have been in his place when I gave the information. I think the latter is probably the right explanation of the situation. I made it quite plain that no sums had been expended; that these were for anticipated expenditure in connection with the Central Health Services Council and the Regional Hospital Boards—I named them quite definitely—and the money would be involved because we have agreed to pay the loss of remunerative time to the members who serve on those bodies, travelling, and subsistence allowances for members so serving, as well as some salaries and expenses with regard to any staff that those bodies will need between now and the 31st March which ends this financial year.
    Sir H. Lucas-Tooth: Does the statement which the right hon. Gentleman has just

    289
    made mean that none of this expenditure has yet been incurred—[An HON. MEMBER: "He has just said it."]—and that none of these bodies is yet actually in existence but will come into existence definitely between now and 31st March?
    8.45 p.m.
    Mr. Key: I think I said quite definitely that no money had been expended. That is because there is no body so far to receive money, but it is anticipated that this amount will be required between now and 31st March. We have circularised all the bodies that we were required to circularise under the National Health Service Act for their recommendations, suggestions, nominations, and so on, of people to serve on the bodies that I have named. We have not yet decided what the position of these bodies will be, but it is expected that that will be done soon. Then, particularly the hospital regional boards, will start functioning, because it is on their recommendations that we have to take the further steps in regard to hospital management committees, and things of that sort. The £5,000 is the anticipated expenditure between now and the 31st March, 1947.
    In regard to Subhead W.3, I went into a very careful explanation of what those items were. I gave several items, and mentioned the emergency provision in the camps taken over by the local authorities. They were camps occupied as a result of squatters taking possession, and afterwards the local authorities took them over, or there was expenditure as a result of the services supplied as a result of releasing them to local authorities. There was increased expenditure by the local authorities in making the necessary adaptations in camps taken over. When approved by us, those costs fall on the Ministry of Health, and they are included in the item W.3.
    Mr. R. S. Hudson: Can we have any details? A very considerable sum is involved; it is several millions sterling. I imagine that the right hon. Member, or the Department, is able to put down a figure of some sort as a result of having received accounts from the local authorities concerned. We should be glad to know in greater detail how this sum is made up. What have the local authorities spent, in round figures, on camps, either as a result of squatters, or of taking
    290
    over from the Services? In his introduction, the right hon. Gentleman was giving a general picture, and I did not interrupt as I thought he would fill it in in answer to questions. He mentioned adapted flats, and houses which were requisitioned. Some of the expense, presumably, has fallen on the local authorities, or the Ministry of Health, or he would not have mentioned it as an item requiring a Supplementary Estimate. We would be glad to know roughly what the figure represents.
    Mr. Key: The squatters problem arose as a result of what happened in August last year. By mid-December some 977 camps had been brought into use. Of those only 29 have been taken over by local authorities on a housing subsidy basis, and the other 948 have an occupancy potential for 14,000 families. The actual occupancy on 15th December was 12,330 families. In addition, there are 777 empty camps, with accommodation for some 9,000 families which have also been offered to local authorities for housing purposes. So far 40 per cent of those have been accepted. It is in anticipation of the expense to be involved in providing that extra accommodation that an item is included in this Subhead.
    Mr. Orr-Ewing: Is it in anticipation of additional expenses of putting into condition camps which have not been accepted, or is it in respect of those which have been accepted?
    Mr. Key: It is in anticipation of both, those which have been accepted and expenditure involved, and those remaining after the 40 per cent. which local authorities may later take up and use for additional accommodation. We are not yet in a position, because the local authorities are not yet in a position, to submit what the actual costs involved are, but we make an estimate of what the actual cost may be, and include it here. The requisitioning here concerned is the requisitioning of habitable houses. It is not a question of the cost of adaptation. When we requisition, we have, of course, to make payment to the person who owns the house, from whom it has been requisitioned. Then, in the accounts with which I was not able to deal, there is the income that comes from those houses.
    Mr. R. S. Hudson: I am obliged to the right hon. Gentleman for the lucid account he has given the Committee. As he has got detailed particulars about what the local authorities have done about camps, perhaps it would be of general interest if he would give us details, which I am sure he has, about the nurseries. I well remember that in his opening remarks he referred to Subhead G.6 which relates to grants to welfare authorities in respect of certain nurseries which they will take over as from 31st March. It appears from what the right hon. Gentleman says that the local authorities have taken over more nurseries than was originally anticipated, which accounts for the increase from the original Estimate of £600,000 to the revised Estimate of £900,000, for which the Government are asking. Then, Subhead W.10, which relates to wartime nurseries, shows an increase from the original Estimate of £600,000 to £2,050,000. He explained that that was because accounts were coming in more rapidly than was estimated. I imagine that it is not beyond the resources of his officials to divide up the figures given under Subhead W.10 and also under G.6, and tell us the number of nurseries which local authorities are actually proposing to take over.
    Mr. Key: Subhead W.10 results from the maintenance of the nurseries during the war period, and the accounts that have been coming in from the authorities should cover the delayed accounts. The number of nurseries that were in existence during the war period numbered roughly 1,350.
    Mr. R. S. Hudson: That was the peak?
    Mr. Key: That was a kind of peak at the end of the war.
    When the end of the war came, it was put to the local authorities that they could continue these nursries as day nurseries, or numbers of them could be handed over to the educational authorities and run as nursery schools, and that if they were so run as nursery schools they would rank for the education grant of roughly 50 per cent.—varying from 29 per cent. to 60 per cent., according to the local authority. In other cases they could be continued as day nurseries, and run by the welfare side of the local authorities. We then agreed that in that case, since this was a really big
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    addition to the expenses of local authorities, the average 50 per cent. grant should be paid in respect of the day nurseries as well as of the nursery schools. We did not quite anticipate that local authorities would continue so many as day nurseries. We rather anticipated that more would be used in an educational capacity and come under the education authorities. The number of day nurseries fell from 1,350 to 920, some of the remainder being closed altogether because of lack of demand; in other cases they were turned into nursery schools. There are 920 of them operating as day nurseries. Their occupancy is roughly, on an average, about 30 per day nursery, so that the total number of children being provided for in day nurseries is about 27,000.
    Mr. Pickthorn: I am not quite sure if it is a fair question, but I should be very grateful if the Minister could tell us what, in the period covered here, was the cost, per child, per week, of these nurseries. Was it about the same as I remember it to have been in 1942? What is the average rate, per child, per week, now, or at the latest time available?
    Mr. Key: I am afraid that since my scholastic days my powers of mental arithmetic have declined, and I am not in a position to answer at the moment. If the hon. Member will put down a Question I will see that an answer is given.
    Mr. R. S. Hudson: On behalf of hon. Members on this side of the Committee, I would like to thank the Minister for the information he has given, or, perhaps I ought to say, for the information which we have extracted. At all events, we got it in the end. While renewing my congratulations to him on his promotion I commiserate with him on his bad luck on the coincidence that his last day in office has involved him in presenting Supplementary Estimates which, if he had been allowed to finish his explanation which was out of Order, would have demonstrated to the country at large the failure of his Department to produce the number of houses that he anticipated.
    Mr. Key: With regard to that last remark, I want to say that quite a little time ago on an Adjournment Debate with regard to the B.I.S.F. house, and other types of houses, I gave an adequate explanation. The explanation was that

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    having made an arrangement as a result of which we anticipated that we should get 30,000 B.I.S.F. houses—
    The Temporary Chairman (Mr. Butcher): I do not think the right hon. Gentleman should raise the question of B.I.S.F. houses in connection with this Supplementary Estimate.
    Mr. Orr-Ewing: I do not wish to say anything about the post-war programme for houses. Earlier the right hon. Gentleman mentioned one thing which puzzled me but at that moment I could not catch his eye. It was with regard to the delayed nature of the charge on nurseries. He said that it covered some of the wartime nurseries. How are we to get some finality in this matter? What steps have been taken to appeal to local authorities to wind up these affairs, as far as wartime expenditure is concerned, so that at some stage we can get a final picture? All Departments are in rather the same trouble, but this is an outstanding case. Are we to get more of this for another 18 months or two years? We all know that local authorities are heavily engaged, because of the tremendous burden which has been put upon them by the Minister's Department. This is a point which should have been un-ravelled before now. I was worried when I heard him introduce the phrase that this still carried a considerable weight of wartime expenditure.
    Mr. Key: Again I must say that this question arises because an hon. Member was not in his place when I gave a reasonable explanation with regard to it. I said that the expenses of wartime nurseries came to an end on 31st March, 1946. The increase in this Supplementary Estimate is due to the fact that local authorities have speeded up with regard to the submission of their costs. It was that speed-up which made essential the submission of this Supplementary Estimate.
    Mr. Orr-Ewing: I am very grateful to the right hon. Gentleman for that explanation. The only reason why I speak now is because the last time he mentioned this, he said it in an entirely different form.
    Resolved:
    "That a Supplementary sum, not exceeding£750,000, be granted to His Majesty, to defray
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    the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Ministry of Health, including grants and other expenses in connection with housing, certain other grants to local authorities, etc., a supplemental grant in respect of medical benefit, salaries and expenses of the Local Government Boundary Commission, a grant in aid of the National Radium Trust, a grant in aid of the Women's Voluntary Services: and other services."

    MINISTRY OF TRANSPORT (WAR SERVICES)
    Motion made, and Question proposed,
    "That a Supplementary sum, not exceeding £8,600,000, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the cost of Shipping and Inland Transport Services arising out of the War."
    9.0 p.m.
    The Parliamentary Secretary to the Ministry of Transport (Mr. G. R. Strauss): I will give the Committee, very briefly, the reasons for these Estimates, and, if any further information is required, I will do my best to supply it.
    The first item—B—is the very substantial one of £33,400,000. That arises from the fact that, when the Estimates were prepared, the release of ships by the Ministry had not commenced, and, since the commencement of release, the speed of release has been very much faster than we anticipated, and has had this effect. The Ministry is liable for the repair and reconditioning of all ships when it returns them to the owners, and the great speed with which these ships have been returned has meant an additional liability coming on to the Ministry unexpectedly and of very considerable extent, particularly in view of the fact that the Ministry have made lump sum payments to the owners in respect of the claim which they have against the Ministry for repair and reconditioning. That was, obviously, to the advantage of everyone concerned, and the sum of £33,400,000 has therefore fallen to be paid by the Ministry to owners in respect of repair and reconditioning of their vessels.
    Against that, there has been a saving of £9 million in that the Ministry have not had to hire the vessels as they have done before. Also included in this total of £33,400,000, is an item of £7,000,000 for expenses of reconditioning of small craft and settlement of claims for expenses of

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    management and superintendence of our ships, and also an item of £12,000,000, which represents advances to managers for operating our ships. Our system of operating ships in our service is to pay the amount required to the managers of the ships for all their costs, and for them in turn to pay back to the Ministry the freights they collect. Item D, amounting to £1,200,000, is for vessel replacement schemes. The explanation is this. When a ship has been lost, the owner is paid by the Ministry 80 per cent. of its value, which is called the basic value, and the owner is paid the additional 20 per cent. when he replaces the ship. Replacement during this year has been at a much higher rate than we anticipated, and we have had to pay out the 20 per cent. in a large number of cases, making a total of £1,200,000.
    Item G is in respect of freights and passages, and the amount involved is £265,000. That is comprised of two items, partly in respect of belated claims which have arisen in respect of reciprocal aid arrangements in regard to ships, and, secondly, for payments for sea transport freight agents, who have replaced the sea transport officers which we used to maintain in various ports abroad, and these two items together amount to £265,000. Item I is for inland transport canals and canal carrying. Under the agreements we have with 38 canal companies and carriers, we have to pay amounts to these companies equivalent, in fact, to their prewar profits. In view of the fall in traffic and the increase in operating costs, there was a higher burden on the Ministry than we anticipated when we made up out Estimates amounting to £330,000.
    Under Item P, "Ministry of Transport Dock Labour Schemes," there is a Supplementary Estimate for £400,000. As hon. Members know, this is a scheme in respect of permanent employment for the Merseyside, and Clydeside dock areas, and the scheme envisaged the payment by the employers of certain sums into what was called the "Management Pool," out of which administrative costs were paid and the employees received certain guaranteed amounts. Due to the fall in traffic in these ports, the fund became empty some little time ago and, in order to keep it going, so that the scheme should not collapse, and so that the situation should remain fluid
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    pending some more permanent scheme which the Minister of Labour hopes to establish, the Ministry of Transport paid into this fund a sum of £400,000. I am only able to comment that, owing to improved traffic lately, the deficiency in this fund has not been growing, and we have not had to pay anything extra into it, although I cannot foretell what will happen in the future.
    The last item refers to Faslane Port, which the War Office handed over to our Ministry in April last year. We became liable for certain works of maintenance over a period of some months until, in August last year, we let the port to a private industrial company who have now taken on the full responsibility for its maintenance. The sum for which we became liable in respect of maintenance during the few months that we were in possession amounted to £10,500. Those items together amount to £35,605,500, for which we are asking for Supplementary Estimates, less a certain amount about which I am, of course, not allowed to speak.
    Major Sir David Maxwell Fyfe: While we are obliged to the Parliamentary Secretary for the information he has given us, there are certain aspects of the amount under Item P about which we should be obliged if he would help us further. He has told us that that refers to the amount required to cover any deficiencies in the operation of the "Dock Labour Schemes" at Merseyside and Clydeside. We should like him to give us some further details so that we may see how this money falls. As far as we can discover, we believe that only a very small part of the £400,000 relates to Merseyside and that, although there was some fall in the trade of the Merseyside ports, the effects of that have been overcome. Further, we believe that, as far as the scheme there was concerned, there was no deficit, and, if anything, that the position was slightly the other way, and that, generally, the labour position is adequate.
    That leads us on this side of the House to consider more closely and to ask for further information with regard to Clyde-side We should like to know how much of the £400,000—if we are right—that really relates to Clydeside, was due to additional working costs. We understand that something like 25 per cent., or

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    £100,000, could fairly be allocated to that. We should also like to know how far the Clydeside scheme was in arrears.
    If I am right in my information, it was about £280,000 in arrear in December, so that we should not be doing anything extraordinary in assuming that it is some £300,000 in arrear now. As the hon. Gentleman mentioned, it is financed by the employers paying a levy which, I understand, is 15 per cent. on the men's wages, and on the other side of that account the guaranteed week's payment is £4 2s. 6d. I understand there has been some feeling that the levy was too high, and that the number of men employed should be reduced. I appreciate that the Parliamentary Secretary may have some difficulty there, and I would like to know what the labour position is because, as we understand it, there has been some falling off of trade, and the labour has not been contracted accordingly. Perhaps the Parliamentary Secretary could confirm our information and our doubts on this point, because, as I understand the position, the independent committee, consisting of a representative of the Parliamentary Secretary's Ministry, a representative of the Ministry of Labour and representatives of the unions and the employers, examined the position last year and recommended unanimously a reduction in the number of men coming under this scheme, from 3,400 by 800 men. I would like to hear from the Parliamentary Secretary whether that is the position, and whether he thinks they are able to put into effect that recommendation, which I understand to have been unanimous, or whether he is still faced with difficulties in that matter.
    As the Parliamentary Secretary is, no doubt, aware, this system will continue to operate for some further six months. We would like to hear from him something about this scheme which, as he told the Committee, is going to provide an alternative. If he is asking the Committee for a Supplementary Estimate of £400,000, of which £300,000, we estimate, is due to the operation of this scheme at the moment with too great a number of employees, before we vote this extra money we would like to know what proposal is being made to put the situation on sound lines. While we all sympathise with the object of the scheme, no one—neither the Parliamentary Secretary nor anyone else—thinks it ought to continue at the cost of a sub-
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    vention from Government funds, which has no basis or true foundation of working, or a true estimate of the labour force needed. Therefore, on that point we would like the Parliamentary Secretary to tell us if that is the position, that there has been this recommendation of reduction of the labour force, and also what his proposals are to avoid a repetition of the need to come to Parliament for a Supplementary Estimate of this kind.
    9.15 p.m.
    Sir Ralph Glyn: I would like to ask the Parliamentary Secretary, whose explanation, though brief, was very adequate, one or two questions with regard to Item B, concerning the hire and operation of ships. The explanation he gave, of course, is governed by the capacity of the yards to recondition ships. If there are ships laid up and unable to receive attention, it is neither good for the country nor good, presumably, for his Department. I wonder whether the hon. Gentleman can give the Committee any information on the question of whether or not the release of shipping for reconditioning is balanced with the capacity of the yards to recondition. No doubt he is able to give us some account of the number of vessels that have been retained for trooping purposes. I believe there are a certain number of ships engaged in trooping, which was not anticipated at the time of the original Estimate. No doubt the hon. Gentleman can give the Committee the approximate figures, and the types of vessels that are still held by his Department, including those of the Victory type, United States ships. Those were very useful during the war, but they form a very small proportion of United States built vessels laid up in estuaries in America, which are of great importance to us at the present time in importing material to this country. I imagine those American vessels are included in Subhead B, and that particular type, of course, will not be subject to the reconditioning he mentioned.
    Could the hon. Gentleman also give us a little more explanation on the position of these vessels in regard to handing them back to their owners in a condition suitable for the new type of traffic? I understand that when the ships were taken over, in many cases the fittings were taken out in a very great hurry. In some cases they were stored, but in other

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    cases the furniture was dissipated during the war, for use in canteens and other places. It is impossible now to obtain furniture, and perhaps the Parliamentary Secretary can say whether the reconditioning he has mentioned does include making these ships suitable for the traffic for which they are designed, and of a type which will bring credit to the British flag, which is very important if we are to pick up our trade again.
    I want to ask a question with regard to Subhead Q—Faslane Port. Many hon. Members know about that port and its importance, but I think very few hon. Gentlemen realise the enormous amount of money that port cost during the war. It was a very heavy capital expense, which was thoroughly justified in the war, because if we had not had that port and enemy action had been as we expected very serious consequences would have arisen. I think the Committee realise that the construction of that port was one of the finest jobs ever undertaken, by the dockyard companies and the Royal Engineers. It was done entirely with Army labour, but I think the cost amounted to between £10 million and £15 million. That port was designed and used for bringing material from overseas. The hon. Gentleman has said it has now been let, I take it at a suitable sum, to a private company. Some of us know who that company is. But are those responsible in the Ministry of Transport satisfied that the use to which that port has now been put, under the company now responsible, will mean it will be maintained in a proper state, should another emergency arise? It is of the utmost importance.
    Incidentally, to reach that port necessitates passing through some very narrow waters by the Gairloch, and unless dredging there is kept going it will silt up, and the port will he of very little value. I am not quite clear whether that will remain the responsibility of the company now operating this port, or whether it will fail on the taxpayer through the Ministry of Transport. I do not know for how long this company, have a lease of that port. I assume they will have to evacuate it should it be required again for public purposes in the national interest. I should be very grateful if the Parliamentary Secretary could give us some information on that.
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    Finally, in regard to the control of the canals and canal carriers. I quite realise that traffic has fallen off, but I do hope that the Parliamentary Secretary can assure the Committee that the amount of subsidy that is going to be given to operate these 38 canal undertakings will certainly be strictly limited; because if we are really going to maintain the traffics on some of the canals which were used in the emergency of war it is going to mean a very great increase in cost until modern appliances can be put on the canals, and locks, and the rest of it, altered. It is useless to put more money into an organisation which, frankly, is not up to modern conditions. To put these 38 canals into proper order, would mean a vast expenditure of capital. I suggest that those employed in trying to operate an out of date form of transport, as some of these are, might very well be employed in other parts of transport where their services very much required.
    Major Cecil Poole: I would reinforce what the hon. Member for Abingdon (Sir R. Glyn) has said about the port of Faslane. When I heard the Parliamentary Secretary's explanation, that the port of Faslane had now been let to a private company, I confess I was filled with some apprehension. I have some little knowledge of the very great part this port played in the shipment of war supplies to our Forces overseas. It is of the utmost importance that this port should be maintained, able to carry exactly the same traffic and to take exactly the same ships as it did during the war. I should like the Parliamentary Secretary, if he would, to tell us a little more detail regarding the length of the period for which this port has been handed over to the private company.
    It is of some interest to the Committee to know just. exactly what the terms of rental pay to the initial capital expenditure. We cannot expect an economic return, because this port was constructed at an abnormal time, and its cost was abnormally high. On the other hand, it was constructed by military labour, by the labour of the Royal Engineers, and I imagine there was very little in labour costs going into the initial capital cost of this port. But it was constructed, not only in those conditions, but, also, in an area which had to be selected primarily

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    for its strategic value, as well as for other considerations; and, therefore, while we do not expect the terms of the letting—
    The Temporary Chairman (Mr. Butcher): I am sorry, but the terms of the letting do not arise out of this Supplementary Estimate.
    Major Poole: I thought it would have a bearing, at any rate, on the Vote for the maintenance for the port of Faslane, but if that is not so, I leave the subject there. I merely press that this port shall be maintained, and that the Committee should be informed how long it is to be in the hands of the private company. There is one other point about which I would ask the Parliamentary Secretary, although I have given him no notice of it. I should like to know, under Subhead B. to what extent the Ministry is at present engaging in the full chartering of ships. I do not know whether he is able to give us that information, but I think; it would be of great interest to the Committee to know to what extent the Ministry is carrying on this practice, which was so extensively the practice during the war. I would also ask, in connection with Subhead G, whether the Ministry still maintain in this country the practice of employing shipping agents. Why does it not now operate its own machinery for this purpose, instead of disbursing very heavy sums every year to agents to perform what is really only a routine service? I should like to see the Ministry of Transport, in the home ports, own a small special organisation, which could be accomplished very much cheaper, I am sure, than is the case at present. I hope that the Parliamentary Secretary can help us on these points, but if not, perhaps he would have a word with me afterwards and give me the answers.
    Mr. Joynson-Hicks: The inquiries which have been directed to the Government on these Estimates from this side of the Committee have come from what are usually called "well-informed" sources. I am afraid that my inquiries may be somewhat more amateur, but they are directed to the Government in order to try to ascertain, in the interests of the taxpayer, where this money is really going. There are two points to which I wish to refer in particular. Perhaps I may be allowed to follow the hon and gallant
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    Member for Lichfield (Major Poole). Although he rather went out of Order, I think that what we really want to know, in reference to Faslane, is how it came about that the Government suffered a loss in regard to operating costs. If this amount was the maintenance cost, between the time when the port was handed over by the Army to the Ministry, and the time that the Ministry entered into their letting of it to a private company, I can understand it, but, according to the Estimates, it is the amount required to meet operating costs. I shall be grateful if the Parliamentary Secretary will give further information on how it came about that the Ministry, when presumably operating the port, required additional sums to meet the additional costs under these circumstances. We know that the Ministry have had in contemplation the operation of a good many docks, harbours, ports and appurtenances of inland traffic, and this small item in the Estimates indicates a failure to make at least a balance between operating profits and expenses, and cannot but be significant in regard to the larger operations in contemplation.
    The other matter to which I should like to refer is in regard to the control of canals and canal carriers under Subhead I. The Parliamentary Secretary, in his succinct explanation, indicated that the Ministry's Estimates under this heading had been falsified by reason of the fact that they were calculated on the prewar basis of profits of the companies concerned, and that during the current year the companies had found their profits had been reduced because of a reduction in traffic and a rise in costs. I think that I have quoted the Parliamentary Secretary reasonably accurately, although not word for word. This again is rather a disturbing item. We all appreciate that costs of everything have increased, but when the Government are responsible, either for operating or meeting the operational costs, then these costs fall on the taxpayer, and this is one of the many items which contribute to the inflationary period through which we are passing at the present time. The other aspect of the matter is equally disturbing, which is that under present circumstances and at the present time the traffic on the canals is below the amount of traffic being carried before the war.

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    9.30 p.m.
    My hon. Friend the Member for Abingdon (Sir R. Glyn) referred to the fact that in many instances these canals were obsolescent. Nevertheless that applies equally to all forms of transport at the present time. The railways have sustained an even much heavier, greater and more arduous degree of wear and tear in the last seven years than the canals; during the past year the pressure on transport, according to the reports which have been given to the House and the public, has been of the most acute type. The reconditioning of the country after its wartime damage, and the renewal of production and output are dependent upon transport, and it therefore seems quite incredible that a Supplementary Estimate is required to meet the costs of the canal operating companies because of reduction in traffic. I feel that had the matter been handled in a different way, or had more attention been paid to the opportunities of transport by the canal system, this additional small but nevertheless significant burden upon the taxpayer need not have arisen. I should be grateful if the Parliamentary Secretary could give us more information, because it is a matter which certainly cannot increase the confidence of the public in the operating capacity of His Majesty's Government, in regard to the transport services.
    Mr. Keenan: I want to ask the Parliamentary Secretary a few questions in addition to those by the right hon. and learned Member for Liverpool, West Derby (Sir D. Maxwell Fyfe). I would like to have more details about the amounts required for the dock labour schemes. The right hon. and learned Member for West Derby spoke of a difference between Clydeside and Merseyside. He suggested a figure for arrears of £280,000, which approached 70 per cent. of the total in the Estimates. I am a little concerned as to what he said about the question of the discussions which have taken place recently in connection with future schemes. I believe this Estimate only deals with the schemes which have been in operation since 1941 and not the schemes which may come into operation at the end of July. It seems to me that an explanation is required because the schemes which were initiated called for a 25 per cent. levy from the em-
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    ployers. That was in excess of what was required and in the first 12 months it was reduced to 10 per cent. It has varied from time to time according to the call being made upon it. I am rather worried why there should be any need for a call of this kind seeing that the industry was called upon to pay a percentage to meet the costs of the two schemes. If the schemes are getting into debt at the present time, obviously the employers are not paying an amount comparable to that they were required to pay when the schemes were initiated. The criticism of the right hon. and learned Member for West Derby gave me the impression that he was looking at the matter from the other point of view. He inferred that there was something wrong with this particular scheme, or the schemes that he was asking questions about.
    Sir D. Maxwell Fyfe: I want to make quite clear that, first of all, I suggested that no part of the deficit had come from Merseyside. With regard to Glasgow, the point that I made was this: that an independent Committee representing the two Ministries—the Ministry of Transport and the Ministry of Labour—the employers, and the trade unions had unanimously suggested that the labour force should be reduced by 800 because it was too many at the time, and I wanted to know if my information was correct on that point. That was the only suggestion that I made, which was based on an independent report. I was not taking any sides in the matter. I was asking whether the recommendations of the independent committee had been put into effect or were to be put into effect.
    Mr. Keenan: The fact that the right hon. and learned Gentleman mentioned the figure of £294,000 out of £400,000 for Clydeside indicated that there was some liability on the Merseyside scheme.
    Sir D. Maxwell Fyfe: What I suggested was that of the £400,000, the sum of £100,000 was due to increased working expenses—I based that on the fact that, according to the information I had, the scheme had been £280,000 in debt in December—and, therefore, I thought the balance, namely, £300,000, was appropriate on Clydeside.
    Mr. Keenan: What the right hon. Gentleman said a few minutes ago certainly does not fit in with the know-

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    ledge which I have of it, although I am not so closely in touch with the position as I was some time ago. It seems to me that so far as Clydeside is concerned, there has not been much attention paid to it in recent months because I understood that periodically on Merseyside they are apt to bring labour there, which has rather disturbed the local people because local men have been dispensed with. Now that the matter has been brought up in this way, I think it would be of advantage if we got to know the actual position, because the right hon. and learned Gentleman did throw some doubt on the Liverpool position. I am very much interested in that because I do not want to see a scheme which had been arranged through the Ministry of Labour prejudiced by anything that may be said here.
    Mr. Douglas Marshall: I rise to make a particular point and to ask for information. It will be noticed that an additional sum is "Hire and operation of ships, £33,400,000" and anticipated savings on bunkering and ancillary services amount to £285,500. I would like to ask the Minister two specific points on that additional sum of £33,400,000: How much of that will require foreign exchange facilities, and how much of it, in fact, will be spent in dollars, and in particular in United States dollars on bunkers?
    Mr. McKinlay: I did not hear the Minister of Works' statement, but I wish to make a point in connection with the Faslane port, which is in my constituency. The Estimate of the additional sum required is £10,500. This is accounted for by costs to which the Ministry were committed between the taking over of the port from the military authorities, and handing it over to a ship-breaking firm. If that is the best use that can be made of it, then frankly I am sorry for the Ministry of Transport. Was any of this £10,500 absorbed in purchasing properties not requisitioned by the military during the occupancy of that area and during the construction of the fort? I am entitled to know that, because I know that many of the property-owners in that district were—I will not use the word robbed—at least unable to get the value of the premises that were requisitioned
    I understand that some of those premises have been transferred to the Ministry of Transport. That sum of
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    £10,500 must have been spent somewhere, and I think I am entitled to know if any of that money was used in paying compensation for the properties taken over by the military, and retained in the possession of the Ministry of Transport for use by their employees at the port. It is a ship-breakers' yard, and so there is not any work for them to discharge. There are only miles and miles of rails, and that apparently is the best use to which the Ministry can put it, namely for breaking up ships. If I have an assurance that no part of that £10,500 was used in purchasing the property, then I should like to get more details as to how, in Heaven's name, it cost £10,500 to maintain a port that was not used almost from the date on which it was transferred. Certainly there was not the staff to absorb £10,500.
    Mr. Marlowe: A number of very detailed questions have been put to the Parliamentary Secretary, and I want to draw his attention to one or two general observations on this account which I think are of some importance. If we look at Sub-head B we find that the original Estimate of the Department was wrong by about 25 per cent., and if we look at the Sub-head G under "Freights and Passages" we see that they were something like 50 per cent. in error. Worst still, under Sub-heading I, the error in the Department is something in the region of 100 per cent. It seems rather surprising that the Department is unable to estimate more accurately the money that will be required. I fully appreciate that the hon. Gentleman has to deal with abnormal accumulations, but one does expect from a Government Department, which is spending public money, some reasonable idea of what it wants. The procedure here is that the Parliamentary Secretary or his Minister comes to the House once a year, and makes an Estimate of what is required. I think we are entitled to expect that these Estimates shall have some reasonable degree of accuracy.
    Apart from that, there is lower down a high percentage of error in other matters. The Department has underspent some £7 million; and there is an Appropriation-in-Aid which has been exceeded by £19 million odd, despite which there is still a deficiency of £8½ millions to be made up. How is it that the Department are unable to estimate, in one case within 25 per

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    cent., in another within 50 per cent., and in still another within 100 per cent., what they will want? These matters are rather important at the moment, because the hon. Gentleman's Department purport to be able to run transport more efficiently than private enterprise has been able to do. I shudder to think what would happen to private enterprise if it tried to run transport on this sort of basis. The Department ought to be able to estimate with some degree of accuracy the amount of expenditure that will be incurred in a given period. It is not very satisfactory to the public to know that transport is to be in the hands of people who are unable to estimate their expenses with any degree of accuracy. I ask the hon. Gentleman to explain how it is that these vast mistakes have been made.
    9.45 p.m.
    Mr. Awbery: I want to say a few words about the dock labour scheme. It will be recalled by most hon. Members that when we were discussing the Measure for dock labour decasualisation last year, it was promised that the dockers would be paid until the new scheme came into operation. It was anticipated then that the new scheme would come into operation on 1st January, but it is not yet in operation. We are now waiting for the Ministry of Labour to prepare a scheme, and until that scheme is prepared, we shall need to finance the men. There may be a deficit in the fund. As the hon. Member for Kirkdale (Mr. Keenan) stated, there has been a reduction of 50 per cent. in the contributions made by the employers to the fund, and if that 50 per cent. cut had not been made, there would have been no need, probably, to bring forward this Supplementary Estimate. As far as the number of men is concerned, this is a problem that has been discussed by the committees in nearly all the ports. In many cases a port has decided to reduce the number of men, but shortly afterwards there has been a demand for labour, and the port has found itself short and has had to call for men from other ports. At the present time, many ports are considering going through the list of men whom they sent away some months ago for the purpose of bringing them back to the docks. It is not an easy job to determine the number of men who will be required on a dock, because the need
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    for dock labour fluctuates so much. I would point out that in the new scheme the question of determining the number of men, in view of the fluctuating amount of labour needed, will be a very difficult one.
    Mr. Orr-Ewing: I would like to refer to the subhead concerning Faslane Port, over which I think the Parliamentary Secretary skated rather thinly. The sum required would appear to be in excess of any reasonable charge that could be incurred in the period on true dock maintenance. It would seem that the expenses of dredging the approach channel must, as the hon. Member for Abingdon (Sir R. Glyn) said, be included in that figure, and all of us who know that port and that part of the country know that the port itself is not the beginning and end of it. There is also involved an enormous amount of complicated and highly expensive sorts of equipment and services. I do not know whether or not they are included in the agreement with the private company. One imagines that there must be some charge for these services, although they are not in use and were not in use in the period in question. There must be some sort of charge for maintenance in the Estimate. Could we be told whether this is the last payment in respect of this matter? Can we be told whether, in fact, we are still proposing to maintain, as I imagine we are maintaining now, the special railway sidings and all the rest of it?
    It is a little misleading for the hon. Gentleman to throw a figure at us, and give the impression that that is the end of it, that it has all been handed over to some private company and we need pay no more attention to it. After all, this Committee will be much concerned if the enormous expenditure in which we were involved in preparing this port, which rendered such valuable services during the war, is allowed to be frittered away. Equally, we are very much concerned if maintenance is being provided for a service which should come under quite a different heading. Now that the Minister proposes to run all the railways, all the bus services and everything else, is he going to pass all these things over to the railway companies to maintain?
    We come back to the same problem, How are we to account for these things properly, and unravel them in this Committee and in the House? There are all

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    sorts of ways by means of which one Department can subsidise the activities of another, so that it will be very difficult for us to say whether in fact the nationalised services will be efficiently performed or not. That is why I believe we have to be meticulously careful, and insist in this particular case in getting as many facts as possible so that our minds may be clear of suspicion before the Minister goes into action with his nationalised rail, road; canal and other forms of transport. There is an almost historic air about this Supplementary Estimate. The first Supplementary Estimate considered this afternoon was the first concerned with nationalised industry to be submitted to us. It was not very encouraging; in fact it was slightly alarming—
    The Temporary Chairman: We have left that. The hon. Member must confine himself to the Estimate under discussion.
    Mr. Orr-Ewing: I am sorry. Now we come to the last Supplementary Estimate which this Government are likely to put before the House before they load themselves with all sorts of other responsibilities, for which we do not know whether they are qualified or not. [HON. MEMBERS: "They are not"] We have our suspicions, but we do not actually know, and I am being very kind. I suggest that our suspicions are undoubtedly reinforced even by the comparatively small items we see here. It is certainly unnerving to see that the estimates made were so inexact. Of course, all sorts of unforeseen elements entered into them. I suppose that when the nationalised railways come before us—
    The Temporary Chairman: I must ask the hon. Member to confine himself to what appears in the Supplementary Estimate.
    Mr. Orr-Ewing: I am afraid I allowed my suspicions to run away with me. One is concerned with the lack of exactitude in estimating and preparing the figures now before us. This lack of exactitude appears to be common to all the Departments at the moment, but is exemplified in this particular Supplementary Estimate. I suppose a snow storm would send up this Supplementary Estimate. As we have it before us today, this Estimate is not efficient or businesslike planning, good layout, vision, drive, enterprise or anything else. It is a bad advertisement for the approach by this Department to great
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    problems. The Department is loading itself with greater responsibilities than it has ever attempted in the past, but by producing a Supplementary Estimate like this, the Minister gives us little hope for the future.
    Mr. G. R. Strauss: A number of questions have been asked about these Estimates. Many of them have been about our plans for the future, and if I tried to deal with them, I should plainly be out of Order. I will, however, try to cover the field as fully as I can. I shall certainly answer all the factual questions which have been asked about the Supplementary Estimates.
    Many questions have been put to me about the Ministry of Transport dock labour scheme at Merseyside and Clyde-side. The right hon. and learned Member for West Derby (Sir D. Maxwell-Fyfe) wanted figures dividing the liability between the Mersey and the Clyde. The latest figure is for 1st February of this year. The debt for the Clyde area was £287,000 and for Merseyside £19,000. At Merseyside at present they are running actually at a surplus, which is helping to reduce the deficiency on the Clyde. The strength of the labour force has been reduced at Liverpool, but not yet on the Clyde. The facts which the right hon. and learned Gentleman mentioned are perfectly correct about the negotiations which took place. Discussions are now being held concerning a possible reduction on Clydeside. We, or the Ministry of Labour, will be able, I hope, to make a positive announcement about this matter in the near future.
    I think those were all the questions the right hon. and learned Gentleman asked about our Dock Scheme. A number of questions were asked about its future but I cannot deal with those because they are the responsibility of the Ministry of Labour at present under negotiation, and it is essentially a matter of policy which would be out of Order for me to discuss on this occasion. The hon. Baronet the Member for Abingdon (Sir R. Glyn) asked me about the release of ships. He asked whether we were releasing ships in such a way as to keep in time with the facilities available for the repair and reconditioning of ships. Actually, it is impossible to do that, because the reconditioning facilities are nothing like sufficient. We are keeping a number of ships in service and we are

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    releasing other ships before it is possible to recondition them. We are acting in cooperation, I think full cooperation, with the shipping industry in this respect. So far as the Supplementary Estimate is concerned, the hon. Baronet will remember I explained that we were paying a lump sum in respect of reconditioning when we released a ship, even though that reconditioning might not be carried out until a year or two later.
    10.0 p.m.
    The hon. Member also asked about the number of ships we were retaining for trooping. I cannot tell him exactly. At the end of November we had 85 British liners on requisition. I cannot give any later figure. He also asked whether the standard which was being established in ships that were being put off for reconditioning was up to the high standard we would desire. I can only repeat that it is not possible to recondition very many ships at the moment, and the actual standard of reconditioning is the responsibility of the company to whom the ship is released. We pay what we consider to be a fair lump sum, usually arrived at by agreement. The hon. Gentleman asked me also what the future of the canals was likely to be, and many questions have come from other hon. Members about the contributions which the Government may have to make towards the canals in future. The answer is that the future responsibility for canals will be that of the British Transport Commission, and I should obviously be wholly out of order if I discussed that fascinating problem.
    Then the hon. Baronet asked me about Faslane, as did many of my hon. Friend, on this side of the House. When I introduced the Estimate I explained that this port came into the possession of the Ministry of Transport for a period last year between April and August. It was handed over by the War Office in April and we came to an agreement with a commercial company to take full responsibility in August. During that period the cost of maintenance alone, without counting other expenses, came to £10,500. It is in respect of that amount that we are seeking a Supplementary Estimate. No further sum will have to be paid as the company to whom we have let the port now take full financial responsibility.
    Mr. Jennings: Will the hon. Gentleman say how long this period was?
    Mr. Strauss: I have said that it was from April to August of last year. The company that has taken over the port is now responsible for maintaining it. My hon. and gallant Friend the Member for Lichfield (Major Poole) asked me about the chartering of ships, and whether we were continuing our chartering policy. I would remind him that my right hon. Friend the Minister of Transport made a very full and important statement on this matter in the House yesterday, but he may be interested in these figures. In November last year we had fewer than 1,000 ships under charter against about 3,000 a year before. My hon. and gallant Friend also asked me in connection with Item G why we were continuing to pay agents in respect of various services required in ports instead of having our own organisation. It would be exceedingly expensive if we set up a special organisation for this purpose—which is a temporary one—and it is far more economical to employ as we do agents, usually shipping organisations, to do this work for us. Other questions were asked by the hon. Member for Chichester (Mr. Joynson-Hicks) who wished to know why we paid this money to the canals last year. We paid it because we had to under an agreement made with the canal companies at the beginning of the war. The Government of the day came to a certain bargain with them to carry on essential war services and we undertook to see that they were not out of pocket as the result.
    Mr. Joynson-Hicks: That was not quite the point. I asked why there should be this deficit in view of the increased need for transport, and the reason given was that the amount of traffic had fallen. Why did it fall?
    Mr. Strauss: The traffic fell because it went in other directions. There are a number of other reasons, but I do not think the hon. Member would wish me to go into them all now. We were not responsible for the fall. The operation costs went up—we know the figures exactly—and we are liable for the payment of the difference because the agreement reached with the canal companies at the beginning of the war is still in force, although it will not be in force permanently. I was asked by the hon. Mem-

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    ber for Bodmin (Mr. D. Marshall) whether any of this sum we have to pay out for reconditioning had to be paid in dollars. I am informed, "No."
    Mr. Douglas Marshall: I said bunkers.
    Mr. Strauss: There is no Supplementary Estimate in respect of bunkers.
    Mr. Marshall: The Estimate sets out the hire and operation of ships, for which a further £33,400,000 is required, and the anticipated saving on bunkering and other ancillary facilities, which are to account for another £285,500. Does the hon. Gentleman suggest that bunkering is not included under the heading of "Hire and Operation of Ships?"
    Mr. Strauss: We cannot discuss saving. I said that the actual saving on hire expenses was £9 million, but there is no additional expenditure involved in the Supplementary Estimates which requires dollars. I was asked by my hon. Friend the Member for Dumbartonshire (Mr. McKinlay) whether the sum in respect of Faslane was in any way used for purchase of land or anything else from the War Office. The answer is "No." It is for maintenance only. The hon. and learned Member for Brighton (Mr. Marlowe) and the hon. Member for Weston-super-Mare (Mr. Orr-Ewing) said that it was outrageous that we should present to the House Estimates which were so much over the amount of the actual money which was in fact expended. When the Estimates are being prepared, which means towards the end of 1945 for the 1946–7 year, and in a period of transition from war to peace, it is quite impossible to make them wholly accurate. We do not know what the traffic on canals will be in 15 months, how quickly we can release ships and give them back to shipowners, and what our liabilities will be in that respect. Any commercial company would have been proud of the accuracy of our forecasting. It is only in respect of a limited number of items that we have had to come forward and ask for an additional Supplementary Estimate. Instead of criticism we ought to get from all sides of the Committee congratulations for having transformed our wartime organisation and arrangements so quickly to the conditions of peace. The main part of the Supplementary Estimates arises from the speed with which we have changed from war
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    to peace conditions, the way we have de-requisitioned ships and handed them back to their owners to enable them to carry on their peacetime trade. Instead of censuring us, the Committee should congratulate us on having been so accurate in our Estimates.
    Mr. Joynson-Hicks: I do not think the Committee will expect the last remarks of the Parliamentary Secretary to go unchallenged. He admits to having missed the original Estimate by £42 million, and says that we ought to congratulate the Government for their accuracy. What can he expect the public to think of that? To ask the Committee to consider that reasonable is asking a great deal too much: I would like to pursue the point about Faslane. It is an error on the part of the hon. Gentleman's Department, which I recognise, and I am sure he is not to blame. The Estimate says that this sum of £10,500 is for operating costs. Now the hon. Gentleman has explained that it is not, but that it is for maintenance costs. I accept that. The hon. Gentleman the Member for Dumbartonshire (Mr. McKinlay) said that that was an absolutely ridiculous figure for maintenance costs from May to August. It anybody should know, surely it is the hon. Member for Dumbartonshire. Particularly having regard to the fact that the hon. Gentleman has inadvertently misled the Committee as to the nature of this charge, I think that we are entitled to have some further explanation as to how this figure is made up.
    Resolved:
    "That a Supplementary sum, not exceeding,£8,600,000, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the cost of Shipping and Inland Transport Services arising out of the War."

    ROADS, ETC.
    Motion made, and Question proposed,
    "That a Supplementary sum, not exceeding £900,000, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March. 1947, for a grant in aid of the Road Fund; for other expenditure in connection with roads; for payments to local authorities in reimbursement of expenses incurred in the collection of motor vehicle duties, etc., and the registration of motor vehicles; and for other services."
    The Parliamentary Secretary to the Ministry of Transport (Mr. G. R. Strauss): In presenting this Supplementary Estimate I will again be brief in my explanation—[HON. MEMBERS: "Why?"]— and I shall be prepared to answer as well as I can any question which may be asked. When the original Estimate was prepared, the opening balance in the Road Fund was expected to be £824,000, but the actual balance proved to be only £198,000. It will be appreciated that much of the expenditure from the Road Fund does not depend on what the Minister does, but on what the local authorities' activities may be. There has been a greater expenditure than was expected on the maintenance of our roads, indeed very much larger—a higher expenditure on maintenance in respect of classified roads of about £2 million, and, in respect of trunk roads, of £2,350,000. The reason for that much greater expenditure on maintenance has been that the local authorities have found it impossible to use modem machines to a great extent and, moreover, a great effort has been made to make the road facilities in the Development Areas better than they were. Against that, there has been less expenditure on improvement schemes, but the net result has been a total increase of grants in aid under the Finance Act from the Road Fund of £2,610,000. That is a much higher expenditure on maintenance and a considerably lesser expenditure on improvements compared with what had been anticipated.
    There is one other item here of £200,000 in respect of payments to local authorities for reimbursement to them of their expenses for the issue of Road Vehicle Licences, etc. The demand for licences was rather bigger than we anticipated, but the really important thing here is that the salaries of the local authorities' servants have risen substantially in accordance with various agreements made between the local authorities and the various councils and associations concerned. In this respect we are liable to meet these expenses, and that accounts for the £200,000 under item "C."
    Resolved:
    "That a Supplementary Sum, not exceeding £900,000, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the
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    31st day of March, 1947, for a grant in aid of the Road Fund; for other expenditure in connection with roads; for payments to local authorities in reimbursement of expenses incurred in the collection of motor vehicle duties, etc., and the registration of motor vehicles; and for other services."

    MERCANTILE MARINE SERVICES
    Motion made, and Question proposed,
    "That a Supplementary Sum, not exceeding£245,000, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of certain Mercantile Marine services, including the expenses of the Coastguard and the General Register and Record Office of Shipping and Seamen."
    10.15 p.m.
    The Parliamentary Secretary to the Ministry of Transport (Mr. G. R. Strauss): The explanation of this Vote is a simple one. There has been a substantial delay in presenting these claims, and the additional amount paid out for seamen's effects is £45,000, and for loss of wages, £62,500. Survivors from wrecked ships are entitled to shipwreck pay. Half is paid by the shipowners, and half by the Ministry. An announcement was made to end the scheme of shipwreck pay in November, 1946, and that gave rise to an unexpected increase in the claims made. There was also a number of Chinese seamen—we could not estimate how many, because they were interned in foreign countries—who have come forward and claimed under this scheme. Those two items together make up the estimate.
    Mr. Jennings: I have listened to the presentation of a number of Estimates, and always the same story is given about underestimating. Is this the end of the story, or are we likely to hear it again another year?
    Mr. Joynson-Hicks: I wish to ask the Parliamentary Secretary about the seamen's charities. It used to be the custom that certain payments to which seamen became entitled when they were distressed, or had been shipwrecked, were paid by the Government under their terms of service. They were disbursed through the organisations, and sometimes directly through the Government. Could the Parliamentary Secretary give information under this heading to cover those charitable items? Could he say whether they are being paid direct at the present time, or through the pools, or through the

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    recognised seamen's organisations of a charitable character?
    Captain Crookshank: The Minister has been very kind in explaining the items, and has saved a lot of time of the Committee, for which I would like to commend him, but he has not dealt with item G2, which is the larger part of the Vote, and deals with Merchant Navy Reserve Pools. Will he say a word about that, and particularly whether that is a permanent part of our arrangements?
    Mr. Strauss: I apologise for having omitted to say anything about that. In answer to the hon. Member for Chichester (Mr. Joynson-Hicks) I am not quite sure what are the channels of payment at the moment, but I will find out, and communicate with the hon. Member.
    I regret that I forgot to say anything about G2—Merchant Navy Reserve Pools. The amount there is rather higher than we estimated for two reasons. The enrolment in the pool was greater than was expected, and although the Essential Work Order came to an end at the end of last year, we extended the provisions of the pool to 31st March this year. on condition that a new pool scheme would be agreed to by the industry by the end of January this year. I am pleased to say that that pool scheme has been agreed, is now being worked out, and the administration will be set up shortly. That has involved an additional payment in respect of that pool scheme which, in total, will amount to £298,000.
    Resolved:
    "That a Supplementary sum, not exceeding £245,000. be granted to His Majesty. to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of certain Mercantile Marine services, including the expenses of the Coastguard and the General Register and Record Office of Shipping and Seamen."

    MERCHANT SEAMEN'S WAR PENSIONS
    Motion made, and Question proposed,
    "That a Supplementary sum, not exceeding £12,500, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for war pensions and allowances (including cost of treatment) arising out of the war of 1914–18 to merchant seamen and fishermen and their dependants and the expenses of the Fishing Vessels Committee."
    The Parliamentary Secretary to the Ministry of Transport (Mr. G. R. Strauss): The Ministry of Transport is liable for the payment of certain pensions and allowances, including cost of treatment, in regard to men who were in the 1914–18 war. As a result of improvements in scales which have been agreed to by the Government and the Treasury for similar pensioners and their dependants, we have raised proportionately the pensions and allowances due to the men who were entitled to them under the 1914–18 scheme. This accounts for the £12,500.

    MINISTRY OF DEFENCE
    Motion made, and Question proposed,
    "That a sum, not exceeding £94,100 be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Ministry of Defence."
    10.23 p.m.
    The Minister of Defence (Mr. A. V. Alexander): I feel sure that the criticism made earlier by my colleague, in the representation of Sheffield the hon. Member for Hallam (Mr. Jennings) and by other hon. Members cannot be applied to this Vote, which is a new Vote. It has already been authorised by the two-days' Debate which took place on the White Paper in October last, in relation to the setting up of the Ministry of Defence. A large proportion of the £94,000 is actually the cost of the transfer, to my new Department, of existing services such as are covered in the actual Estimate itself, which hon. Members can see for themselves. They comprise, in the Department, the administrative divisions charged with the functions laid upon me by the Act which the House has passed. These included the formulation of a unified defence policy and functions connected with the three Services, their supply, including operational resources, the correlation of research and development policy and the settlement of general administration. The Chief Staff Officers Division provides the secretariat for the Chiefs of Staff Committee and its subcommittees, and include the secretariat of

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    the British Joint Staff Mission in Washington and the Military Staff Mission to the United Nations organisation. In addition, the Department as set out in paragraph 30 of the White Paper, assumed control of certain inter-Service organisations, the Joint Intelligence Bureau, the Imperial Defence College and Combined Operations Headquarters. Of the total estimate of £94,100, £24,000 is to cover the payment of the new Minister, and of the additional staff required for the setting-up of the Department.
    I think that the relatively small nature of the financial requirements of my Department, which I have submitted to the Committee, to cover the period in the current financial year, since my own appointment and the opening of the Department from 1st January, will assure the Committee of the intention I have expressed in previous Debates, that the Ministry of Defence, over which I have the honour to preside, should be kept small, compact and not allowed to blow itself up into a large and cumbersome organisation. May I add, that the Members of the Committee will have the opportunity, I hope, of seeing, within a very few days, a White Paper on defence policy, on which a Debate will be arranged through the usual channels, and upon which the whole policy can be debated.
    Mr. Osbert Peake: First I wish to congratulate the right hon. Gentleman upon the new office which he adorns and in respect of which he has presented us with this Supplementary Estimate for the remaining months of the year. The figures contained in it cover only, I think, a period of two or three months. Therefore, the annual Estimate, when we get a complete picture, will be some four times this figure. Am I right in that?
    Mr. Alexander: Approximately, yes.
    Mr. Peake: There are one or two questions I should like to ask. I see that the Permanent Secretary, that is the civil head of the Department, is to be remunerated at the rate of £3,500 a year. I take that to be the rate now adopted for the heads of all the major Departments of State.
    Mr. Alexander indicated assent.
    Mr. Peake: I am much obliged. The other question is in regard to Subhead D on page 9. That is "Special Missions and Services, £7,500." I take it, again, that is for the short remaining period of the financial year now expiring, and that that sum, in the ordinary way, will be more like £25,000 or £30,000. I hope the right hon. Gentleman, if it is not too secret, will be able to tell the Committee something about the nature of the expenditure under that Subhead. If he is not able to do so for security reasons, perhaps he will explain how it comes about that in the Joint Intelligence Bureau, where I imagine matters of a fairly high degree of secrecy will be discussed, the pay of a third-class woman draftsman, of whom no fewer than 14 are to be employed. should be the singularly small sum of £3 a week. It seems to me that in Departments where security considerations are paramount, it would be wiser to pay the third-class woman draftsman, who is, I imagine, something above the ordinary typing or clerical grade, at a rather higher rate than £3 per week. I know something about the rates of salary which were paid in some of the secret Departments during the war. As a rule, even the typist received a higher rate than the £3 mentioned here for the third-class woman draftsman.
    Sir Ralph Glyn: I wish to ask one question in regard to the vacancy which is shown to exist under the reference to the Chairman of the Joint War Production staff. There is a footnote to say that the Permanent Secretary is acting in that capacity. Can the Committee assume that that appointment will be filled so as to make the White Paper, when published, more comprehensive? It is one of the most important of these posts, as I think the right hon. Gentleman indicated some time ago. I should also like to reinforce what my right hon. Friend the Member for North Leeds (Mr. Peake) has just said in regard to the pay for these subordinate appointments. We have had a great deal of evidence about this kind of thing, and I am satisfied that it is far better to have fewer people with better pay, than to have a large number of people paid at very low rates. If this is to be, as we all hope, a matter of security, it is essential that these people should be contented and of the right type. There is no doubt that the £7,500 for which the right hon. Gentleman is asking under the

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    heading of "Special Missions and Services," will lead to missions being sent to the Dominions. I think it is wrong for secretaries and typists to be sent, either to the United States or to the Dominions, with inadequate means so that they cannot look after themselves when they are there. That situation now exists in Washington. The hardship suffered by Service staffs both men and women, in a country where there is a high scale of living, is undoubted
    10.30 p.m.
    Flight - Lieutenant Crawley: I should like to ask a question about the Joint Intelligence Bureau. I am not clear whether the bureau, in its peacetime form, is to do what was done by the bureau during the war. Is it to co-ordinate various kinds of Service intelligence, or has it a wider function? Most people who have worked in Intelligence, feel that the time has come when all these services should be under one chief, and many have been hoping they would be made the responsibility of the Minister of Defence. When war comes, these various Intelligence branches become elaborated into separate Services, and in the last two wars the waste resulting from sudden expansion of that kind, without any single central responsibility, has been appalling. I think the formation of the Ministry of Defence is a great opportunity for co-ordination in this respect, and I wonder whether anything of the kind is in view.
    Viscount Hinehingbrooke: Will the right hon. Gentleman vouchsafe a little more information on Subheads B and C? I think he said the cost of the Washington Missions was borne on the Vote of his Department. Does Subhead B represent travelling to and from Washington or does it include other things? Could the right hon. Gentleman also explain the £1,000 item for telegrams and telephones? [An HON. MEMBER: "The silent Service."] I understood that the Royal Navy was the silent Service. If it was not silent, I understood it communicated by wireless through its own network, and that the War Office also had private lines to various parts of the country. Since the right hon. Gentleman's Department was constituted only in October, I cannot understand why it has been necessary to put down an Estimate up to 31st March for £1,000 for telegrams and tele-
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    phones. It seems very high. My final question is with regard to the item on page 9 of £125 paid to a lecturer. Was that Professor Laski?
    Mr. Joynson-Hicks: Perhaps I may carry on the interrogation to the next section of the Vote. I appreciate that as regards the Combined Operations Headquarters, the emoluments of the Service staffs are borne on the Vote of the Department concerned—as set out in the footnote—but it seems strange that the cost of the messengers and temporary assistants and temporary clerks should be borne by the Ministry of Defence. I should be very glad if the right hon. Gentleman would explain why his Department is responsible for the emoluments of the messengers.
    Mr. A. V. Alexander: With regard to the first point put to me by the right hon. Gentleman the Member for North Leeds (Mr. Peake) with regard to special missions and services, I do not think I can say that the whole of this £7,500 is to be incurred in three months entirely by the Department. It is an apportionment, made by the Treasury, and now properly charged to our Department, as its proportion of the year's expenditure for the period since the Department has been set up. I cannot guarantee that for special missions of this kind, the amount required would necessarily be exactly four times this amount in future years. I can only promise that we will exercise all possible economy, and if we pay for these special missions, it will be with a view to getting the best possible results.
    As to the point with regard to the payment of women draftsmen, I am not sure whether the right hon. Gentleman had in mind what those employees are and the work they are doing. I should say that they were people employed in the past in the Department which I am taking over, and employed by us now, in copying sketch maps and other coloured maps. These are necessary to illustrate papers and the like, and a large number are required from time to time. I am always glad to hear from the other side of the Committee that they are in favour of paying higher salaries to workers, and I shall be very glad to make the necessary inquiry, as a result of the right hon. Member's query whether the present remuneration in this case is adequate or

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    not. Judging from other remarks I have heard from the other side, I thought the Opposition would be rather anxious to keep expenses as low as possible. I am glad to hear this suggestion tonight, and I will look into the matter which has been raised by the right hon. Gentleman.
    Mr. Randall: But not at the expense of the workers.
    Mr. Alexander: I have said that I am always glad to hear suggestions for higher salaries for workers.
    Another question raised by an hon. Gentleman opposite, was with regard to the chairmanship of the Joint War Production Committee. For the time being, it is much more convenient that we should, in organising this new aspect of this Joint War Production Staff in peacetime, let the new Permanent Secretary of the Department do the work. He is very able, and has great Treasury experience. For the time being, at any rate, I think he will have time to do this work. The right hon. Gentleman can rest assured that if, at any time, I find that we must have a new chairman, I shall not hesitate to see that the appointment is made. In the interest of keeping staff as low as possible at present, and until the matter is more fully developed, I prefer to do it in this way at present. The hon. and gallant Member for Buckingham (Flight-Lieutenant Crawley) mentioned the Joint Intelligence Bureau. I should like to thank him for his remarks. The whole idea of the bureau is to get real coordination of the results of the Intelligence Service. The bureau is working now with the Intelligence branches of all the different Services, both military and civil, and in consequence we are getting a much more economical collation of results.
    The noble Lord the Member for South Dorset (Viscount Hinchingbrooke) asked about travelling and incidental expenses. This is not a sum of £4,000 specially incurred by my new staff in the space of three months. This sum is the allocation by the Treasury to the Department in respect of what they consider to be our share of travelling, for the Services which we now cover. The same applies to the item for telegrams and telephones. I do not think the noble lord need get anxious. This is for all the tele-
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    grams and services which have to be covered, if we are to carry out the whole of the Intelligence Service, the Imperial Defence College, and the many inquiries and contacts which must be made if the Chiefs of Staff are to be properly briefed by planning staffs, and I am sure he would want that done. As to his remarks about a certain professor, who is a very good friend of hon. Members on this side of the Committee, if the noble Lord looks at the paper carefully he will see that this item is in the plural. It refers to the fees to Lecturers. There is no reason for regarding that as a payment to one lecturer, namely, Professor Laski. I am sorry that through thinking of other matters I almost overlooked the point made by the hon. Member for Chichester (Mr. Joynson-Hicks). I wonder if he will be good enough to repeat it?
    Mr. Joynson-Hicks: Why is the right hon. Gentleman's Department responsible for the emoluments of all the messengers of Combined Operations Headquarters, and no one else?
    Mr. Alexander: For the time being, the charges for the Combined Headquarters are almost entirely for military officers; and for the time being those charges are being carried on the Votes of the War Office and other Service Departments.
    Captain Crookshank: May I remind the right hon. Gentleman that he has said nothing about the question of cost of living for staffs in the United States which is, I think, a matter of considerable importance. I refer to the secretariats of the Joint Staff Mission and the Military Staff Committee of the United Nations. This question seems not to have been noticed. It may be that there is some compensation for this purpose included in some other Vote.
    Mr. Alexander: This particular item is an apportionment, and the actual details to which reference has been made are subject to adjustment. I may say that I have had experience in the last few years of adjustments being made to cover cost of living and household accommodation in Washington. I assure the right hon. and gallant Gentleman that, wherever possible, compensation for the higher cost of living will be paid. All the cases are examined on their merits.
    Sir R. Glyn: May I point out that the rate of allowances in Washington has not been increased in proportion to the recent increases for civilians. This means suffering for some of the lower grades on the staff. I should be glad if the right hon. Gentleman would look into this matter again.
    Mr. Alexander: I have not yet had a case, in the new Department with which I am concerned, but I assure the hon. Member that if I have notice of any particular cases, I will look at them.
    Major Legge-Bourke: When the right hon. Gentleman says that "for the time being only," the messengers are being paid from his Vote, are we to take it that, next year, the whole staff will be paid—
    The Chairman (Major Milner): The question of what is to be done next year does not arise.
    Resolved:
    "That a sum, not exceeding £94,100, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Ministry of Defence."
    The Parliamentary Secretary to the Treasury (Mr. William Whiteley): As the acting Leader of the House promised that we should not keep the Committee too long tonight, I now beg to move, "That the Chairman do report Progress, and ask leave to sit again."
    Resolutions to be reported Tomorrow; Committee also report Progress; to sit Again Tomorrow.

  POLES, UNITED KINGDOM (EMPLOYMENT)
  Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Michael Stewart.]
  10.44 p.m.
  Mr. Skeffington-Lodge: I am very glad that the Minister of Labour himself has come along to reply to this Debate, and I wish more time had been available to deal with the subject on which I wish to speak tonight. In the course of his recent statement to the House, my right hon. Friend stated that, so far, only about 2,000 of the 142,000 Poles still in this
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  country have been placed in civilian employment. It was because I and many other hon. Members on this side of the House considered that, in present circumstances, this was extremely unsatisfactory, that I gave notice I would raise the matter again. There is, of course, no short cut to the rapid absorption of any large number of foreigners, whatever their nationality, into our national life. I do feel, however, that much more might already have been done to speed up the elaborate machinery which has been set up for this purpose in relation to the Poles, for whom we have, in some quarters willingly and in some quarters reluctantly, accepted a responsibility.
  Let me briefly give the House the background facts as they are known to me. The Poles in our midst—of whom roughly two-thirds were Allies, in the full sense, all through the war—at present have three courses of action open to them. Firstly, they can, as one recently put it to me, "take a chance" and return to Poland; secondly, they can volunteer for and join the Resettlement Corps; or, thirdly, they can play a game of "wait and see," which is linked in some cases with a looked and longed for chance to emigrate. Some 20,000 of these Poles have already opted to return to Poland; and more among the doubters, I feel, might do so if more impartial news of those who have gone back to Poland were readily available. Encouragement from Warsaw would, I think, help here. In the second category I have mentioned there are about 58,000 men. The remainder of the Poles in this country have still to make up their minds about their future. There is evidence that among the officer class in particular there is a vested interest in maintaining the status quo, which I think is a not unnatural thing. But this I suggest should be very carefully watched, if only because the high proportion of men in commissioned rank enables them to exert a more than usual influence on their comrades. I have reason to think that in some cases the prospect of becoming mere alien civilians themselves, if they lose their flunkies, has at least led to discouraging enrolment in the Resettlement Corps, and to the preference of so many Poles for what can only be called a "no man's land" status. There is also some influence, which I believe actually to be quite small, which

  327
  seeks to discourage men from going back to Poland.
  All this, of course, is more a matter for the Secretary of State for War than for my right hon. Friend. But it has relevance to this Debate, I think, because it is important that my right hon. Friend should know at the very earliest moment just how many men out of the grand total are actually available to him as a permanent labour force in this country. The sooner the doubters and those who are hesitant make up their minds, or can be persuaded to make up their minds, the easier will be the Minister's task. Far from discouraging it, the controlled influx of foreigners into our labour market should be very much pressed on with as one of the best, and possibly the only means open to us of surmounting our present economic difficulties. And in the Poles already here lies a ready to hand labour force which should, as soon as possible, be supplemented by displaced persons in Europe, the bulk of whom, of course, are the fellow countrymen of the Poles among us.
  I hope that my right hon. Friend will be able tonight to give me an assurance that he will use all his influence to see that the screening, sorting, and making-up-their-minds process, as applied to all Poles in this country, is greatly speeded up. It was on 22nd May, 1946, that the Foreign Secretary announced the formation of the Resettlement Corps. Yet, to give just one example of inactivity, it is only in recent weeks that any attempted enrolment to that Corps has been begun of the 8000 members of the Polish Forces in the North-West Region of the Ministry of Labour. An accurate classification of those opting for the Resettlement Corps is the next urgent step, and this, I am told, has been hanging fire in various parts of the country. Other problems thenceforward facing the Minister lie in such direction as finding jobs for the volunteers, fixing them up with accommodation, and so on.
  The undesirability of using these Poles as gang labour should be obvious to everyone in the House; and this, of course, means that they must be absorbed individually. It is not, I feel, detracting in any way from their courageous bearing, and their bravery in the war, to say that they are not the easiest people to acclimatize to our British way of life. The
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  mental atmosphere of medieval romanticism in which they often appear to dwell, makes them psychologically difficult. We must, however—and this is perfectly clear —honour the responsibility that we have assumed; and it is, of course, quite true that they are good and very hard workers. An hon. Member on this side of the House talked to me this afternoon about the magnificent work which the Polish Forces have done in Lancashire during the past week in clearing snow from the Lancashire to Yorkshire main line railway. He said, "I do hope you will mention this, as evidence of the fact that they are prepared, when given the chance, to get down to a job."
  The Minister must, I feel, go all out in getting these men into jobs, for the manpower gap, in coalmining, especially, in spinning and in foundry work is becoming enormous. It will soon—and very soon—exist in agriculture, and in such things as brickmaking, both of which are so notably represented, incidentally, in my own constituency. I ask the Minister tonight to use all his influence with the Trades Unions, so as to ensure that the new realism of the more far-sighted leaders about this foreign labour question permeates to every branch of the rank and file, and removes what is, in our present plight, an absurdly conservative approach to some of these labour questions. It is right, of course, to insist that no foreign workers shall become a cheap labour force, impeding improvements for our own people, or threatening unemployment; and there must, again, be safeguards against the Poles, or anyone else, forming any enclave or cell in our national life.
  But it would do good and not harm if that anti-foreigner complex and the nationalistic and illiberal outlook, which still seems to haunt the Home Office in their attitude to would-be immigrants, were once and for all cut out. Manpower, in the lower age groups of our own people, is bound to shrink for some years ahead, and because of that, we can do with all the physical help we can lay our hands on. In addition to those already here, it is pertinent to point out that there are some 380,000 Poles, many with first-class industrial and agricultural experience, waiting to be used who are now sitting in idleness in the British and American zones of Germany. This huge labour pool should be tapped, and should be tapped

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  quickly, before other countries like Belgium, which are already awake to this situation, steal a march on us. The Poles already over here should be removed at the earliest moment from a military atmosphere. This, I recognise, depends very largely on the speed with which my right hon. Friend presses on with their absorption into civilian life. It is obvious that in the interests of morale, efficiency and discipline the present arrangement cannot he changed over night, but it would help our relations with the Warsaw Government—and I am one who wants to see those relations very much improved—if the difficulties accounting for the present situation were more carefully explained than they have been.
  Finally, I want to ask the Minister to give me an undertaking tonight to make a regular progress report to this House. I even hope that he may be able to offer some encouragement about the actual placing here and now, in view of the miserable figures which he gave us on 28th January as far as those who are actually engaged in civilian occupations in this country are concerned. I recognise that the difficulties in connection with this problem are very considerable, but they are there to be faced, and they are there to be overcome, and they will only be overcome by the development of a long overdue spirit of drive and urgency in tackling them. We cannot possibly afford any longer to keep a costly contingent of Poles in our midst, either in voluntary or in enforced idleness, and the sooner the Government push on with their absorption into useful activities, the better it will be for all concerned.
  10.59 p.m.
  The Minister of Labour (Mr. Isaacs): I welcome the opportunity of giving some further information upon the question which has been raised by my hon. Friend, the Member for Bedford (Mr. SkeffingtonLodge). May I first express my appreciation of the spirit in which he has brought the matter forward and given the facts? I hope to be able to give him most of the information for which he has asked, and I hope I may be able to give the assurance and the undertaking lie desires. He, quite rightly, said that there is no short cut to the employment of Poles. We found that in endeavouring to tackle this problem. I repeat what I said the other day, that the principle of
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  accepting them and placing them is fully accepted, but it is a question of machinery and ways and means?
  There is a widespread impression that because there is a labour shortage and because there are 140,000 Poles available, it is simply a question of putting them into jobs which are vacant. I do not want to use the analogy of square pegs in round holes, because someone might ask if the pegs were Poles. First, we have to make sure that we are putting willing men into suitable jobs. It is no use just getting hold of a bunch of these fellows and shovelling them into jobs. They are human beings, men of a fine type. I took the opportunity, a few days ago, to go into one of the camps to see the screening at work, and the selection of these men for employment. I saw clean, healthy, decent men who have been through the fire of war side by side with our men, or, if not that, have been in our Armies. Once they got into our workshops with our British workers I am sure that the first antipathy of our working men to them would melt away once they realised that these Poles are, after all, human beings. Once we get the scheme started these men will, I am sure, be welcomed and received wholeheartedly. But we are anxious not to rush on, and upset things by being too hasty. Our aim has been to find the suitable job for the suitable man, to ensure that he will be able to carry on without opposition. If we make a mess of things in the beginning we shall create problems which will make absorption more difficult. The movement up to now has, I admit, been slow, slower than we would have hoped. We badly want to get these men at work. Not only that, but we want them to be earning their keep, instead of being kept at the expense of the State. It is a piece of two-way traffic that will help in both directions.
  We are trying to place the maximum number of these men into work as civilians, and the minimum number into uniform, to work in gangs. We want them to get out of uniform, out of the military atmosphere. We do not want them to settle down in any kind of employment where they are engaged under any kind of semi-military control. We want them to be under the orders and directions of foremen and overseers, and not sergeants, sergeant-majors, or commissioned officers. We must remember that these men are being treated, in this scheme, as free

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  agents. We want them to be placed as volunteers, because we all remember the old saying about a free man being better than a pressed man. We want them to come in willingly. The fact that they have been enrolled in a corps means that they are willing to come in as free men. This makes the placing of these men a little different from placing prisoners-of-war. If we wanted to send a gang of prisoners-of-war to clear a road, or anything of that kind, we could order them to do the job. But we do not want to treat the Poles like that. We want them to come in as volunteers.
  Another big problem is the fact that a high proportion of these Poles do not speak English. For most of our occupations, a knowledge of our language is essential. Instructions have to be given to these men, and if we want to use them on the skilled work which many are capable of performing it is essential that they should understand the instructions, and be able to read the directions, which are given to them. It will be easier to hesitate a little, and teach the Poles English than to try to teach their instructors the Polish language. If we added that to the burden of our instructors and overseers we should find ourselves in great difficulties.
  The next point upon which my hon. Friend touched was the necessity of obtaining co-operation. It has been a matter of obtaining co-operation not only with the trades unions but also with the employers. In addition to the agreement of the trade union to the employment of the Pole and of the British workman to work with him, we have had to get the employers to agree to have him. In the beginning we attempted to achieve this co-operation by means of the various Departments of the Government handling their own particular sections. The Ministry of Fuel dealt with the coal mines, the Ministry of Supply with their industries, the Ministry of Agriculture with theirs, and so on. Very soon, however, we came up against the peculiar difficulty that each of the industries concerned gained the impression that that they would be required to take all the Poles, or very nearly all, and each of them said, "Before we make up our minds, let us see what the other fellows are going to do." At that point it was decided to place the matter in the hands of the Ministry of
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  Labour, and we proceeded by meeting the Joint Councils of the industries. Here I should like to inform the House that at the outset the National Joint Advisory Council, which consists of representatives of the British T.U.C. and the Federation of Employers organisation, very readily and willingly agreed to the principle of the employment of Poles. Thus, right at the top, we had encouragement to continue our efforts. Then we had to get down to the industries.
  We have done so, and we have found a very ready acceptance of our proposals and a desire to help. I can therefore assure my hon. Friend that the influence he has asked me to use with the trades unions has already been exercised. I have had many years' experience in the trade union movement and I am happy to say that we are receiving very cordial co-operation from that quarter. If hon. Members will read an article published in the current issue of a T.U.C. organ called "Labour" they will find there a very clear indication of the desire that this work should be continued. The industries with which we have had successful negotiations so far are agriculture, coal mining, building and civil engineering, gas, retail bespoke tailoring and parts of the iron and steel industry. They have all agreed to take men. The next thing is to arrange when and where they shall take them, and other details.
  Some of the Poles who have registered for those industries have said that they have skill in a particular occupation, but here we have found ourselves up against the question of what really was their trade. In the centre which I inspected I found that a great number of these men were registering themselves as "locksmiths." It began to be somewhat surprising to find that there were so many locksmiths until we discovered that the term "locksmith" was synonymous to the Poles with the term "engineering" in this country, and that when a man spoke of himself as a "locksmith" he really meant what we mean by "engineer." That was one of the problems, and although we overcame it it shows that if we are to ask a firm to take a man who describes himself as a certain type of craftsman we must be satisfed that he is in fact what he says. We should probably kill this scheme if, when an em-

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  ployer asked for half a dozen engineers, the men we sent to him turned out to be nothing of the kind. He would be likely to send them back and to say, "If that is the kind of men you are going to send me I do not want any more." That is another reason for going steadily in this matter. If men were sent back in such a case we should have to return them to the resettlement corps, and as soon as we did that they would dishearten other men who had not yet come out.
  Viscount Hinchingbrooke: Surely the Minister is not suggesting that as a formidable difficulty. Is it not simply a question of reference to a dictionary to discover exactly what the men are?
  Mr. Isaacs: No. It has to be understood that these people are speaking their own language, which has to be interpreted to our officer who is registering their particular kind of work. When we became used to the synonymous terms to which I have already referred, and we asked one man who said he was a locksmith if he did not really mean "engineer," he pointed to a lock and made it perfectly clear that he meant what he said. In that particular case the man was in fact a locksmith. I merely mention this to show that you cannot just get these men from the Resettlement Corps, put them in a wheelbarrow and take them off to a job. We have to know what we are doing. In coal mining, training is essential; there must be training before the men are put into jobs. Then there is the other problem, that they must have some knowledge of English before they can assimilate training; that is another problem that crops up. But I want to make it clear that the major obstacle is accommodation. As time is short, perhaps the House will permit me to make a brief statement rather than amplify it. Housing is very short in all areas; the alternative accommodation is in camps, but that is not so easy as it sounds. The Army and the Air Force are quite willing to give us camps, but many of our camps are built in very remote parts of the country for safety reasons, away from the centres of industry, and when we get the camps many of them are so far away that it is very difficult to get the men to the jobs
  Mr. Peake: Are there not, all over the country and especially
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  in the coalfields, the hostels built by the right hon. Gentleman's Ministry during the war for the accommodation of trainees for the coal and other industries?
  Mr. Isaacs: Yes, but perhaps the right hon. Gentleman will not mind my saying that at that moment I had departed from coal; I do not think there is as great a problem so far as coal is concerned as there is for the vast number of other industries. If the House will permit me, I will show where we are getting to in this. The camps raise other difficulties well, for when we have the camps we have to have somebody to run them; what we are hoping to do is to put in them the Poles who have wives with them, and so arrange things that the wives will he able to take over the running of the camps so that we shall not have to draw on other British labour for this purpose. These administrative difficulties are being overcome.
  Now as to progress. The number of enrolments in the Resettlement Corps is now 62,000 and it is hoped that enrolment will be completed in the first quarter of this year. They have to be screened to find out whether in fact they are Fascists or not; they have to be enrolled in the Corps and then we step in and register them for employment. Skilled employment officers see them and find out their capacities and then go about finding places for them. I can report an improvement; it is not a very big figure in itself but it is an improvement; placings have now reached 3,200—that is 1,200 up on last week, but of course it is only a small number. We are however confident of accelerating that rate of placings. We have already planned, and have arrangements to place many hundreds—I would not like to give an exact figure—in the immediate future in the brickmaking industry, in building materials. forestry, and road schemes. Other vacancies are already earmarked, as soon as we can get the right types, in tin-mining, cotton, iron-stone mining, building and civil engineering, various sections of the iron and steel industry, and agriculture. These vacancies are immediate. and will be filled as soon as the fuel difficulties have been overcome. Many of these industries are fuel-using industries and as soon as we can get that moving these men will be available and will he placed.

  335
  Arrangements for the first batch to go into training for the coalmining industry are now going forward. It is hoped that we can arrange for an intake of 300 a week for the coalmining industry. Time does not permit me to go much further, but I said I would give an undertaking to the House. I have given an undertaking that the screening machinery will be proceeded with rapidly, and I can give the undertaking asked for that I will make a periodical report. At the, moment I think it could be a monthly report, and I think I can make it as from the end of the current month. I will keep the House fully informed of exactly what steps are being taken, the progress that is being made, and any difficulties that have arisen. I hope in that very brief sketch, I have been able to draw attention to the
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  human problem that exists here, and to assure the House that it is the Government's intention to make use of the greatest number of these men that can possibly be used.
  11.14 p.m.
  Mrs. Braddock: There is just one further assurance that I would like to have from the Minister. I hat is that, in no circumstance, will Poles be put in competition with unemployed British people asking for work.
  The Question having been proposed after Ten o'Clock and the Debate having continued for half an hour, Mr. DEPUTY-SPEAKER adjourned the House without Question put, pursuant to the Order made upon 13th November.
  Adjourned at a Quarter-past Eleven o'Clock.

HOUSING (SCOTLAND)
  Aluminium Houses (Dampness)
  Aluminium Houses (Dampness)
  Concrete Flooring
  Concrete Flooring
BRITISH ARMY
  Territorial Army
  Territorial Army
  Tradesmen, Royal Signals (Release)
  Tradesmen, Royal Signals (Release)
  Leave
  Leave
  Infantry Battalions (Suspended Animation)
  Infantry Battalions (Suspended Animation)
  Colonel Rocke
  Colonel Rocke
  Parades, Catterick (Greatcoats)
  Parades, Catterick (Greatcoats)
PRISONERS OF WAR
  Football Matches
  Football Matches
  Officers (Outside Work)
  Officers (Outside Work)
  Batmen
  Batmen
MINISTRY OF PENSIONS
  Ex-Service Pensioners (Re-examination)
  Ex-Service Pensioners (Re-examination)
  Personal Case
  Personal Case
  BRITISH EX-PRISONERS, JAPAN
  BRITISH EX-PRISONERS, JAPAN
  BELGIAN OCCUPATION TROOPS, GERMANY
  BELGIAN OCCUPATION TROOPS, GERMANY
OLD AGE PENSIONS
  Means Calculation
  Means Calculation
  Residence Condition
  Residence Condition
NATIONAL FINANCE
  Dollar Expenditure
  Dollar Expenditure
  Ex-Civil Servants (Stabilised Pensions)
  Ex-Civil Servants (Stabilised Pensions)
  Anglo-Argentine Agreement (U.S. Representations)
  Anglo-Argentine Agreement (U.S. Representations)
  Purchase Tax
  Purchase Tax
  National Holiday
  National Holiday
  Invisible Exports
  Invisible Exports
  Stamp Duty
  Stamp Duty
CIVIL SERVICE
  Examination Fees
  Examination Fees
  Called Up Personnel (Pay)
  Called Up Personnel (Pay)
  Justices of the Peace
  Justices of the Peace
TRADE AND COMMERCE
  Industrial Fuel Cuts
  Industrial Fuel Cuts
  Furniture Imports
  Furniture Imports
  Clothing Supplies (Overseas Forces)
  Clothing Supplies (Overseas Forces)
  Japanese Goods
  Japanese Goods
  Hand-Knitting Yarn (Coupon Loss)
  Hand-Knitting Yarn (Coupon Loss)
  Furniture Distributors' Margins
  Furniture Distributors' Margins
  Postage Stamps
  Postage Stamps
  New Firms (Materials)
  New Firms (Materials)
  Dishcloth Cotton
  Dishcloth Cotton
  Government Surplus Clothing
  Government Surplus Clothing
  Industrial Films
  Industrial Films
  Clothing Coupons (Medical Students)
  Clothing Coupons (Medical Students)
  Tourist Board (Staffing)
  Tourist Board (Staffing)
  U.S. Motorcars (Imports)
  U.S. Motorcars (Imports)
  British Motorcars (Exports)
  British Motorcars (Exports)
  Master Printers' Letter
  Master Printers' Letter
  Leather
  Leather
TOWN AND COUNTRY PLANNING
  New Towns (Heavy Industries)
  New Towns (Heavy Industries)
  Service Land Requirements (West Wittering)
  Service Land Requirements (West Wittering)
  NATIONAL INSURANCE (OLD AGE PENSIONS)
  NATIONAL INSURANCE (OLD AGE PENSIONS)
EMPLOYMENT
  Benefit Payment
  Benefit Payment
  Milling Industry, Aberdeenshire
  Milling Industry, Aberdeenshire
  Tool-kit Grant
  Tool-kit Grant
  Non-industrial Workers
  Non-industrial Workers
  Short Time
  Short Time
  Betting Industry
  Betting Industry
  Shipworkers' Strikes (Lost Man Hours)
  Shipworkers' Strikes (Lost Man Hours)
  Entertainment and Sport
  Entertainment and Sport
  Assisted Migration
  Assisted Migration
  Non-Productive Industries
  Non-Productive Industries
  North Staffordshire
  North Staffordshire
  Civil Service (Hours of Work)
  Civil Service (Hours of Work)
  Disabled Persons
  Disabled Persons
  UNIVERSITIES (EX-SERVICEMEN)
  UNIVERSITIES (EX-SERVICEMEN)
COAL INDUSTRY
  U.S. Exports (Europe)
  U.S. Exports (Europe)
  Allocation Scheme (Closed Works)
  Allocation Scheme (Closed Works)
  HOUSING (ELECTRICAL APPARATUS)
  HOUSING (ELECTRICAL APPARATUS)
  ARMED FORCES (COMPASSIONATE LEAVE)
  ARMED FORCES (COMPASSIONATE LEAVE)
  IMMIGRATION (PERSONAL CASE)
  IMMIGRATION (PERSONAL CASE)
  GERMAN PRISONERS OF WAR (FRANCE)
  GERMAN PRISONERS OF WAR (FRANCE)
  HEALTH SERVICE (PERSONNEL)
  HEALTH SERVICE (PERSONNEL)
  TELEPHONE EXCHANGE, YETMINSTER
  TELEPHONE EXCHANGE, YETMINSTER
  WHIPPING SENTENCES
  WHIPPING SENTENCES
Preamble
The House met at half past two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers.

  BUSINESS OF THE HOUSE.
  VISCOUNT SWINTON: My Lords, I beg leave to ask the Leader of the House a question with regard to business. I understand that there is to be some rearrangement of business, and the House would be grateful for a statement.
  THE SECRETARY OF STATE FOR DOMINION AFFAIRS (VISCOUNT ADDISON): My Lords, I think it would be for the convenience of the House if we re-arranged business so that we should bring to an end at a definite hour the discussion on the Committee stage of the Companies Bill. I suggest that time should be 5·30 p.m., and not later, if that meets your Lordships' convenience. I think it would be generally acceptable if we did not continue the Committee stage on Thursday but resumed it on Tuesday next. I understand that there may be a wish to have a discussion on Thursday on the coal position. I have not had any official confirmation of that from your Lordships, but I think it would be convenient to have it on that day, after the other Orders, which are quite formal.
  VISCOUNT SWINTON: That suggestion will be very much for the convenience of the House, and it will not hold up progress on the Companies Bill.

PALESTINE.
2.35 p.m.
LORD STRABOLGI: My Lords, I beg to ask the question standing in my name on the Order Paper.
[The question was as follows:
To ask His Majesty's Government: whether they are now in a position to make a further statement about the position of British business men still in Palestine; whether in the case of those who are allowed to stay, their families
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are to be compulsorily evacuated; what is the position with regard to British civilians of the Jewish faith, and what is the estimated number of these including their dependants; what is the policy with regard to American and other non-Palestinian residents; how many women in Government employment are being permitted to remain; and whether British business men are to be allowed to enter Palestine on their lawful occasions?]
THE FIRST LORD OF THE ADMIRALTY (VISCOUNT HALL): My Lords, the cases of British business men in Palestine are being considered individually by the authorities, in consultation with the heads of the business houses concerned. Such limitations as are placed on the activities of those allowed to remain will be the minimum which circumstances demand. Their families are being evacuated unless there are reasons which, in the opinion of the Palestine authorities, are sufficient to warrant their remaining. British Jews are not being evacuated. I am not in a position to state their numbers. Foreign nationals are not being evacuated.
As regards women in Government employment, I take it that the noble Lord is referring to British women. There are some fifty British women employed in Government hospitals and only a very few in other Government Departments. As I stated in my reply to the noble Viscount, Lord Simon, on February 4, the only Government officers who are being evacuated are some women teachers who have gone to Trans-Jordan. As regards the entry of British business men, no entry permit for Palestine is being granted to any British subject without reference to the Palestine authorities. In the present situation, only urgent and important cases are being referred.

SUNDAY ENTERTAINMENTS ACT, 1932 (COUNTY BOROUGH OF WALSALL ORDER).
LORD WALKDEN: My Lords, I beg to move that this Order be approved.
Moved, That the Order made by the Secretary of State for the Home Department under the Act, for extending Section 1 of the Act to the County Borough of

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Walsall and laid before the House on Wednesday last, be approved.—[Lord Walkden.]
On Question, Motion agreed to.

SUNDAY ENTERTAINMENTS ACT, 1932 (URBAN DISTRICT OF ROYSTON ORDER).
LORD WALKDEN: My Lords, I beg to move that this Order be approved.
Moved, That the Order made by the Secretary of State for the Home Department under the Act, for extending Section 1 of the Act to the Urban District of Royston and laid before the House on Wednesday last, be approved.—[Lord Walkden.]
On Question, Motion agreed to.

SUNDAY ENTERTAINMENTS ACT, 1932 (RURAL DISTRICT OF DUNMOW ORDER).
LORD WALKDEN: My Lords, I beg to move that this Order be approved.
Moved, That the Order made by the Secretary of State for the Home Department under the Act, for extending Section 1 of the Act to the Rural District of Dunmow and laid before the House on Wednesday last, be approved.—[Lord Walkden.]
On Question, Motion agreed to.

COMPANIES BILL. [H.L.]
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—[The Lord Chancellor.]
On Question, Motion agreed to.
House in Committee accordingly.
[The EARL OF DROGHEDA in the Chair.]
Clause 1:
Preliminary amendments as to annual general meeting.
(2) The power conferred by subsection (3) of the said section one hundred and twelve, where there has been default in holding a company's annual general meeting, to call or direct the calling of a general meeting of the company shall be exercisable by the Board
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of Trade instead of by the court and shall include power to give such ancillary or consequential directions as the Board think expedient, including directions modifying or supplementing, in relation to the calling, holding and conducting of the meeting, the operation of the company's articles.
LORD CHORLEY LORD CHORLEY moved, after subsection (3), to insert the following new subsection:
"(4) Where a company resolves that a meeting shall be so treated, a copy of the resolution shall, within fifteen days after the passing thereof, be forwarded to the registrar of companies and recorded by him, and if a company fails to comply with this subsection the company and every officer of the company who is in default shall be liable to a default fine of two pounds.
"The noble Lord said: It is intended here to fill a small gap in subsection (2), which gives the Board of Trade power to call a meeting of the company if the company does not hold a meeting within the statutory period as laid down in subsection (1), which in general, amongst other things, requires a company to hold a meeting at least once in every year. Subsection (3) provides that where the Board of Trade do call such meeting it shall be deemed to be the annual general meeting, but that where, for example, a company makes default in holding a meeting in 1947 and the Board of Trade, in consequence, call a meeting which does not take place till 1948, the company can take that as the annual general meeting for 1948; but if they choose to do so they must so resolve. The Amendment requires that a copy of the resolution shall be forwarded to the Registrar; otherwise the company shall be liable to a fine. I hope your Lordships will agree to insert the Amendment to fill the gap.
Amendment moved—
Page 2, line 14, insert the said new subsection.—(Lord Chorley.)
On Question, Amendment agreed to.
Clause 1, as amended, agreed to.
Clause 2:
Length of notice of meetings and of business thereat.
2.—(1) For paragraph (a) of subsection (1) of section one hundred and fifteen of the principal Act (which, subject to the company's articles, provides that a meeting of a company other than a meeting for the passing of a special resolution may be called by seven days' notice in writing) there shall be substituted the following paragraph:
"(a) a company's annual general meeting may be called by twenty-one days

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notice in writing, and a meeting of a company other than an annual general meeting or a meeting for the passing of a special resolution may be called by fourteen days' notice in writing;"
and, notwithstanding anything in the said subsection (1) any provision of a company's articles shall be void in so far as it provides for the calling of a meeting of the company (other than an adjourned meeting) by shorter notice than that specified in this subsection.
(2) A meeting of a company shall, notwithstanding that it is called by shorter notice than that specified in the foregoing subsection or in the company's articles, as the case may be, be deemed to have been duly called if it is so agreed—

(a) in the case of a meeting called as the annual general meeting, by all the members entitled to attend and vote thereat; and

(b) in the case of any other meeting, not being a meeting for the passing of a special resolution, by a majority in number of the members, being a majority together holding not less than ninety-five per cent. in nominal value of the shares giving a right to attend and vote at the meeting, or, in the case of a company not having a share capital, together representing not less than ninety-five per cent. of the total voting rights at that meeting of all the members.

LORD COZENS-HARDY LORD COZENS-HARDY moved, at the end of subsection (1), to insert:
"unless the company being a private company has by special resolution at its last annual general meeting approved of a shorter period."
The noble Lord said: As the Bill stands twenty-one days' notice of the annual general meeting must be given to all shareholders, and by the next subsection the balance sheet and profit and loss account must similarly be sent twenty-one days before the annual general meeting. In a family business, run as a private company, it is often convenient to have the annual general meeting as soon as possible after the ordinary accounts are ready, but by the Bill an annual general meeting cannot be held earlier than twenty-one days after the accounts are ready. The purpose of my Amendment is to allow a private company, by a special resolution passed at the previous meeting, to adopt a shorter period than twenty-one days. It limits the exception to one year, unless a similar resolution is passed at the preceding annual general meeting. If, as I hope, the noble and learned Viscount, the Lord Chancellor, can agree that some such provision might properly be allowed, I think it will be necessary, to insert in subsection (3) (b) words having the same effect.
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If the exception in favour of all private companies is considered too wide, I should be content with what the Cohen Committee call "exempt private companies," which are, in fact, genuine family concerns. I beg to move.
Amendment moved—
Page 2, line 34, after ("subsection") insert the said words.—(Lord Cozens-Hardy.)
LORD CHORLEY: I regret that we do not see our way to accept this Amendment. We appreciate the point which has been put by the noble Lord, but the arguments on the other side seem to be stronger. If this Amendment were accepted it would permit a private company to pass a special resolution at an annual general meeting so as to absolve itself from the requirement to give twenty-one days' notice of subsequent annual general meetings. It is very important indeed that members of private companies should have good notice of meetings; indeed, from some points of view, quite as important as in the case of a public company, because, as your Lordships are aware, there are very often disputes of a particularly bitter and difficult character going on in these private companies between majority and minority interests. Complaints are often made that the dominant majority interests hold meetings on quite a number of occasions in a very hurried manner, so that the minority interests get no real opportunity of looking after their side of the business.
As your Lordships are aware, a special resolution requires the approval of 75 per cent. of the members, and if the noble Lord's Amendment were accepted it would mean that the remaining 25 per cent. could be put into a most disadvantageous position. Under Clause 2 (2) (a) the twenty-one days' notice of an annual general meeting can be waived if all the members entitled to attend and vote there-at agree. If that were the situation, the difficulty at which the noble Lord's Amendment is aimed would be solved.
LORD COZENS-HARDY: I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD CHORLEY: The next Amendment is that the words "not being a meeting for the passing of a special resolution," on page 2, line 42, should be omitted. Under Section 117 (2) of

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the Companies Act, 1929, it is provided that if all the members entitled to attend and vote at a general meeting so agree, a resolution may be proposed and passed as a special resolution at a meeting of which less than twenty-one days' notice has been given. In practice, it is sometimes important to pass a special resolution at short notice, and it is very difficult, in the case of a company of any size, to secure the agreement of all the members to the waiver of notice. Usually one member is ill, or, maybe, abroad. The Amendment, accordingly, provides that in such a case a 95 per cent. majority shall be sufficient to waive the notice. Ninety-five per cent., obviously, is a very large majority, and in these circumstances I hope that your Lordships will accept this Amendment.
Amendment moved—
Page 2, line 42, leave out ("not being a meeting for the passing of a special resolution").—(Lord Chorley.)
On Question, Amendment agreed to.
LORD CHORLEY: The next Amendment is purely drafting. I beg to move.
Amendment moved—.
Page 2, line 44, after ("members") insert ("having a right to attend and vote at the meeting").—(Lord Chorley.)
On Question, Amendment agreed to.
LORD CHORLEY LORD CHORLEY moved, after subsection (2), to insert the following new sub-section:
"(3) In the proviso to subsection (2) of section one hundred and seventeen of the principal Act (which enables a resolution of which less than twenty-one days' notice has been given to be passed as a special resolution) for the words 'if all the members entitled to attend and vote at any such meeting so agree' there shall be substituted the words 'if it is so agreed by a majority in number of the members having the right to attend and vote at any such meeting, being a majority together, holding not less than ninety-five per cent. in nominal value of the shares giving that right or, in the case of a company not having a share capital, together representing not less than ninety-five per cent. of the total voting rights at that meeting of all the members'; and subsection (5) of the said section one hundred and seventeen (which provides for computing the majority on a poll by reference to the votes to which a member is entitled) shall not be taken as applying for the purposes of the said proviso."
The noble Lord said: This Amendment is purely consequential on the Amendment to Clause 2, page 2, line 42, and I do not think that it requires any further explanation. I beg to move.
Amendment moved—
Page 3, line 6, at end, insert the said subsection.—(Lord Chorley.)
On Question, Amendment agreed to.
LORD CHORLEY LORD CHORLEY moved, after subsection (3), to insert the following new subsection:
"(4) Any document required to be circulated before a meeting by subsection (2) of the said Section' one hundred and thirteen, or by paragraph (a) of subsection (1) of the said Section one hundred and thirty, shall, notwithstanding that it is circulated later than is thereby required, be deemed to have been duly circulated if it is so agreed by all the members entitled to attend and vote at the meeting."
The noble Lord said: This Amendment provides that all members of a company can agree to waive the requirements of Section 113 (2) and Section 130 (1) (a) as to the circulation of documents in advance of a meeting. Clause 2 (3) (a) amends Section 113 (2) so as to require the directors' report to be circulated fourteen days before the statutory meeting, and Clause 2 (3) (b) amends Section 130 (1) (a) so as to require copies of the accounts to be circulated twenty-one days before the meeting at which they are to be laid before the company. This is just filling in a gap. I beg to move.
Amendment moved—
Page 3, line 29, at end insert the said subsection.—(Lord Chorley.)
On Question, Amendment agreed to.
Clause 2, as amended, agreed to.
Clause 3:
Circulation of members resolutions, etc.
3.—(1) Subject to the following provisions of this Section it shall be the duty of a company, on the requisition of such number of members as is hereinafter specified and (unless the company otherwise resolves) at their expense—

(a) to give to members of the company entitled to receive notice of the next annual general meeting notice of any resolution which may properly be moved and is intended to be moved at that meeting;

(b) to circulate to members entitled to have notice of any general meeting sent to them any statement of not more than one thousand words with respect to the business to be dealt with at that meeting.

(4) A company shall not be bound under this Section to give notice of any resolution or to circulate any statement unless—

(a) a copy of the requisition signed by the requisitionists (or two or more copies each signed by some of them) is deposited at the registered office of the company—

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(i) in the case of a requisition requiring notice of a resolution, not less than five weeks before the meeting; and

(ii) in the case of any other requisition not less than one week before the meeting and

LORD MANCROFT: The next is hardly more than a drafting Amendment. Subsection (2) of this clause specifies the number of members necessary for a requisition. In subsection (4), however, it is provided that a requisition may be signed by requisitionists on a number of different copies. As a matter of drafting, it appears to me to be possible that a requisitionist might sign more than one copy and that claims might be counted in respect of each copy. By my Amendment it is made plain that each requisitionist can be counted only once, even if he signs on two or more copies of the requisition.
Amendment moved—
Page 3, line 31, after ("requisition") insert ("in writing").—(Lord Mancroft.)
THE LORD CHANCELLOR: I am happy to accept this Amendment.
On Question, Amendment agreed to.
VISCOUNT MAUGHAM VISCOUNT MAUGHAM moved, in subsection (1) (b), after "to" where that word occurs a fifth time, to insert: "the matter referred to in any proposed resolution or." The noble and learned Viscount said: I daresay that this is really not very much more than a drafting Amendment. I thought, however, that it would be better to make it clear that a requisition need not refer only to the matters intended to be moved at the meeting, but might also refer to a matter concerned in any proposed resolution. The Amendment is really of no very great effect, except that there might be certain resolutions which were not strictly business to be moved at the meeting. I beg to move.
Amendment moved—
Page 3, line 40, after ("to") insert ("the matter referred to in any proposed resolution or").—(Viscount Maugham..)
THE LORD CHANCELLOR: I am grateful to the noble and learned Viscount, and I agree with him. I think that this is a small matter, and I have pleasure in accepting the Amendment.
On Question, Amendment agreed to.
THE LORD CHANCELLOR: This Amendment, like the next one, is a drafting Amendment and is designed to get
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rid of the ambiguity inherent in the word "may". I beg to move.
Amendment moved:
Page 4, line 11, leave out ("in which notice of the meeting may be served") and insert ("permitted for service of notice of the meeting").—(The Lord Chancellor.)
VISCOUNT SWINTON: May I congratulate the noble and learned Viscount, the Lord Chancellor, on an admirable precedent which I hope will be followed.
On Question, Amendment agreed to.
LORD CHORLEY: I beg to move the next Amendment.
Amendment moved:
Page 4, line 14, leave out ("in which he may be given") and insert ("permitted for giving him").—(Lord Chorley.)
On Question, Amendment agreed to.
LORD HAWKE LORD HAWKE moved, in subsection (4) (a), to leave out from "copies" to "is" and insert: "which between them contain the signatures of all the requisitionists". The noble Lord said: Subsection (4) (a), as it stands, appears to be a trifle obscure, and I venture to think that the Amendment standing in my name clears up any obscurity there might be. I beg to move.
Amendment moved:
Page 4, line 25, leave out from ("copies") to ("is") and insert the said new words.—(Lord Hawke.)
THE LORD CHANCELLOR: I agree with the noble Lord. His words are an improvement on the Bill, and I have much pleasure in accepting the Amendment.
On Question, Amendment agreed to.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved, in subsection (4) (a) (i), to leave out "five" and insert "six". The noble Lord said: Under this clause a specified portion of the members of a company may, by requisition, require a company to circulate a statement to shareholders. The company is, in turn, required to give three weeks' notice of its annual general meeting. As the notice to be given by the requisitionists is five weeks, there are, therefore, only two weeks left for the company to prepare a rebuttal, if they have to do so, and for the printing and filling of the envelopes. It is very difficult for a large company to do this in the fortnight at its disposal, and the Amendment proposes that the fortnight should be increased to three weeks.

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In order to make this possible, it is necessary that the notices to be given by requisitionists should be increased to six weeks instead of the five weeks mentioned in the Bill. I beg to move.
Amendment moved—
Page 4, line 28, leave out ("five") and insert ("six").—(Lord Balfour of Inchrye.)
THE LORD CHANCELLOR: Let it be accounted to me for righteousness that this is the fourth consecutive time that I have accepted an Amendment.
VISCOUNT SWINTON: May it not be accounted to us for righteousness how much we have improved the Bill?
On Question, Amendment agreed to.
2.53 p.m.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved, in subsection 4 (a) (ii), to leave out "one week" and insert "two weeks." The noble Lord said: In a spirit of optimism I beg to move this Amendment. It is not quite clear under this clause who is really to be responsible for the printing or the making of the necessary copies for distribution to members. If the company has to do it, then the one week allowed under subsection (4) (a) (ii) might be inadequate in the case of concerns with many shareholders. The clause appears to call for the deposit with the company of the signed copies of the requisition only. If that is so, the company will presumably have to do the printing or other copying, as well as the addressing and posting. I beg to move the Amendment which stands in my name, therefore, to increase the time limit.
Amendment moved—
Page 4, line 31, leave out ("one week") and insert ("two weeks").—(Lord Balfour of Inchrye.)
THE LORD CHANCELLOR: I am sorry to disappoint the noble Lord, but I do not see my way to accept this Amendment, for this main reason. Though I quite realize the point he has made and the difficulties inherent in the matter, he will remember that, except for the annual general meeting which requires twenty-one days' notice, all other meetings require only fourteen days' notice. Consequently, if you are going to have a requisition you must give the man who is potentially going to requisition time to
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digest that which is in the notice. And, further, you must give him a chance of getting his battalions together and a certain number of collaborators to act with him. That takes him some time, and if you insist that the copy shall be deposited not less than fourteen days before the meeting, he may have to give notice of his requisition before or at the same time as he receives the notice of the meeting about which he wants to requisition. This is manifestly impossible. That being so, it is essential that you should have some shorter period than that of the notice necessary for the meeting, within which the requisition must be put forward. That is why the Cohen Committee suggested one week, and with that we agree. Therefore, I am afraid I cannot accept this Amendment.
VISCOUNT SWINTON: I think the noble and learned Viscount may be right, but I am sure that we want here to do what is fair both to the people who wish to make the requisition and circulate resolutions and memoranda, and also to the company, which may be a very large company with, perhaps, 100,000 shareholders to circulate. There should be every opportunity for a shareholder to approach the company, and at the same time the company should have time to do all the necessary clerical work which is required. In the case of a small company this is nothing very much, but in the case of a great company it is very extensive indeed, particularly in these days of a shortage of clerks. I think there is much more than that involved, and I am sure that my noble friend the Lord Chancellor will help me on this matter.
Important as it is that the requisitionists should get adequate time to introduce the resolution and any memoranda which they wish to circulate to the shareholders, it is equally important that the directors of the company should have adequate time to consider the requisition and to put out any comments and memoranda for the information of the shareholders, and that the shareholders should receive a considered statement both from the requisitionists and from the board of directors. I am sure that we shall agree that these things are necessary, and I want to be quite sure, if this Amendment is not carried, that nothing is done which prejudices the time that is really necessary for the management of the company

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to do the clerical work and, still more, to pass on to the shareholders a considered judgment upon any proposition which is put forward.
THE LORD CHANCELLOR: I will gladly look into that matter. I do not think that is so. The obligation on the company is to circulate so far as possible, and they cannot, of course, be expected to work the impossible. But I will gladly look into the observations the noble Viscount has made to see whether any further provision is necessary, though I think we have safeguarded the position as fairly as we can.
VISCOUNT SWINTON: I think probably the point I am anxious about is much more safeguarded by the Amendment which the noble and learned Viscount has already accepted, which substitutes "six" for "five," but I rather thought that to some extent the two things hung together.
VISCOUNT ELIBANK: Before we pass on, perhaps the Lord Chancellor may be prepared to compromise and make it ten days instead of two weeks. Both noble Lords have mentioned the amount of work involved in printing and in consideration, and so on, in the case of a large company, and even three days would make a difference. We are talking, of course, about normal times. At present we cannot get any printing done at all—I happen to know that from a case that came before me recently. I urge the noble and learned Viscount to say whether or not he could extend the period by even three or four days. That would be of great assistance.
THE LORD CHANCELLOR: I will look into the matter, but I cannot say more than that.
LORD BALFOUR OF INCHRYE: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 3, as amended, agreed to.
Clause 4 agreed to.
Clause 5:
Voting at meetings.
5.—(1) Any member of a company entitled to attend and vote at a meeting of the company shall be entitled to appoint another person (whether a member or not) as his proxy to attend and vote instead of him, and a proxy appointed to attend and vote instead of a
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member shall also have the same right as the member to speak at the meeting:
(2) In every notice calling a meeting of a company there shall appear with reasonable prominence a statement that a member entitled to attend and vote is entitled to appoint a proxy to attend and vote instead of him, and that the proxy need not also be a member; and if default is made in complying with this subsection as respects any meeting, every officer of the company who is in default shall be liable to a fine not exceeding fifty pounds.
(5) On a poll taken at a meeting of a company, a member entitled to more than one vote need not, if he votes, use all his votes or cast all the votes he uses in the same way, and accordingly in subsection (5) of Section one hundred and seventeen of the principal Act (which provides that the three-fourths majority of the members needed for an extraordinary or special resolution shall on a poll be computed by reference to the number of votes to which each member is entitled) for the reference to the number of votes to winch each member is entitled there shall be substituted a reference to the number of votes cast for and against the resolution:
Provided that a member shall not be entitled to vote both for and against a resolution where the validity or effect of the resolution depends on the number of members voting for or against it or where the rights, if the resolution is passed, of members voting for it differ from those of members voting against it.
LORD COZENS-HARDY LORD COZENS-HARDY moved, in subsection (1), to leave out "whether a member or not" and insert:
"(who, except in a private company which is exempt from the obligation mentioned in Clause 43 hereof, need not be a member)."
The noble Lord said: The object of this Amendment is to preserve the privacy of the family business if it is an exempt private company; that is, a company which complies with the very stringent conditions imposed, and on which is placed the obligation to file its profit and loss account. That privacy will undoubtedly be in danger if a proxy who is not a member has a right to attend the meetings of the company. The reasons given in the Cohen Report in favour of non-member proxies were that a member might not know the names of his fellow-members, or might be far from the offices of the company or of the Registrar of Companies. Those reasons lose much of their force when applied to a family business limited, as it must be, to fifty shareholders, and subject to all the conditions entitling it to exemption. I beg to move.
Amendment moved—
Page 5, line 34, leave out ("(whether a member or not)") and insert the said new words.—(Lord Cozens-Hardy.)
THE LORD CHANCELLOR: I think that we should make a mistake if we were to insert these words. I shall have something to say presently about the right of the proxy to speak, but I think we ought to allow the proxy to go there, even though he is not a member of the company. Let me say, with regard to these private companies and family businesses, that it is just those businesses where there is sometimes a good deal of rough-riding over the interests of particular people. Not infrequently it happens that one member—it may be the widow—finds herself rather put upon the majority. She dm, not understand anything about the business, and it is only right that she should be able to send her solicitor, a family business man or somebody to represent her and put her point of view. It is right that in just this sort of case we should say she may send somebody to represent her in this way. I am going to suggest, later on, that that somebody ought also to have the right to speak. I think it is right, in order to avoid hardship to some minority interests, to permit somebody to be sent to represent some particular member. Therefore, I regret that I cannot accept this Amendment.
LORD COZENS-HARDY: Would it be possible to make some provision to the effect that the non-member proxy is bound to secrecy?
THE LORD CHANCELLOR: I do not think that it would be any good. If he were going to breach a matter which was obviously confidential, he would breach it whether there was any provision in the Bill or not. I do not think that that would be very effective.
LORD DARWEN: Speaking as a member of a private company, I think that to some considerable extent the difficulty would be overcome if the Lord Chancellor would accept an Amendment to restrict proxies to legal representatives. That would seem to me to get over most of the difficulties.
THE LORD CHANCELLOR: In the great majority of cases, I think he would be a legal representative, but there may be occasions where some man of affairs,
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some business man who is not necessarily a lawyer, would be the obvious person. In fairness, I think you must leave the member to select her own proxy.
LORD COZENS-HARDY: I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
VISCOUNT MAUGHAM VISCOUNT MAUGHAM moved, in subsection (1), to leave out from "him" to the beginning of the proviso. The noble and learned Viscount said: This Amendment is one of considerable importance. I confess that I am somewhat astonished that the Committee have suggested that the proxies should always be entitled to attend and speak. That is a revolution in Company Law. I have had considerable experience of meetings of companies; I have actually attended some myself. I have a vision of a company meeting at which two or more members of my old profession, that of the law, have been briefed to attend and make a speech on a resolution designed to be passed on a show of hands at the meeting, or, it may be in certain cases, to delay the proceedings at the meeting. To my mind, it would be quite wrong to have solicitors and counsel of eminence, or perhaps of less eminence, appearing and making long speeches at such meetings.
A great many of these meetings are matters of vital importance to some section of the company. There are, for instance, meetings to change the rights of some of the people under a section of the Act, and large advantages in money may attend the views which the company as a whole expresses at the meeting. It is entirely a revolution in company practice to have a meeting of a public company addressed by professional people who have no personal interest in the matter at all, who are not shareholders and who do not care two straws what the future of the company may be. It is a revolution to have them addressing eloquent harangues to the meeting as a whole.
I know meetings into which it is very difficult to obtain admission at all. In the old days, meetings of large companies with registered offices in London were held in a room in the Cannon Street Hotel. Where they go now I am not so sure. There is, I think, another room in another big hotel. But there are many meetings of this sort where it is very difficult for all the members themselves

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to get in, and you should consider the matter very carefully before you permit people to attend as a proxy and speak. I suppose a proxy in such a case could come as well as the member, because he might easily be appointed as proxy to vote in respect of only a portion of the shares of the member. The member would say: "I am holding one share, and I am going to vote for myself, but I have a proxy here who is going to vote in respect of 1,000 shares." The room might be full of people and the secretary or other officers of the company would be quite unable to prevent complete strangers from entering the room and starting, as soon as possible, to address harangues to the meeting. That would be a revolution in company practice, and would be greatly against the interests of the company. Whether there ought to be some modification to my Amendment is another thing altogether; but as a whole, on the general principle, I think it is only in exceptional circumstances, which may possibly be capable of definition, that a proxy, not being a member of the company at all, and whether or not a professional man, ought to be entitled to interfere in the actual conduct of the meeting. I beg to move.
Amendment moved—
page 5, line 35, leave out from ("him") to the end of line 37.—(Viscount Maugham.)
VISCOUNT SWINTON: It would probably be for the convenience of the House if we took all these Amendments together, if your Lordships are agreeable, because they deal with the same subject. I should like very briefly to support what the noble and learned Viscount has just said. Popular as it might be to have meetings where the board of directors had briefed Sir William Jowitt and one of the shareholders had briefed Sir Frederick Maugham, and long and entertaining as no doubt would be the speeches they would deliver in consideration of an adequate fee, I cannot think that such an innovation would serve any useful business purpose, other than that of their private businesses. As the noble Viscount has said, it would utterly and entirely alter the whole character of a general meeting of a company. It would also quite interminably prolong its proceedings, because obviously if Sir William Jowitt is retained for one side then someone as nearly as possible of equal weight and learning must be retained on the other
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side, and heaven knows whether there would not be an "inter-pleader," if that be the right expression, by somebody else. The place would be as full as a popular libel action, with silks in one row and juniors in the other. The wretched board of management would have little time to conduct their business and to fill up those many forms which they are required to fill up after the meeting has closed. That that would not be at all a good innovation I am sure that the noble and learned Viscount, the Lord Chancellor, would readily agree.
At the same time I am bound to say that my Amendment, which follows next, does propose a case for making an exception in regard to a genuine private company. I am not sure that I shall carry my noble friend Lord Cozens-Hardy with me in this. I can well imagine, as the noble and learned Viscount, the Lord Chancellor has said, that there are cases of a private company where there is an issue between, say, two members of a family and a third. The third may be an invalid or a widow, quite incapable of attending—though far be it from me to say that women are less capable than men of putting their case, or talking at great length. In that case it would not be inappropriate that the proxy should be entitled to pm the case. I suggest to your Lordships that the practical compromise is the one which I have put down, and which I think the noble and learned Viscount, the Lord Chancellor, adumbrated earlier that he would be prepared to accept: that in a public company the proxy can attend but should not be able to speak, and in the genuine private company the proxy can vote and, if necessary, speak.
LORD RENNELL: The Amendment which has just been discussed stands also in my name, and I should like to support what has been said. I think it is a compromise view of the rather more far-reaching doctrine put forward by the noble and learned Viscount, Lord Maugham. The real difficulty, in regard to which I find myself in disagreement with the noble Lord, Lord Cozens-Hardy, is that one knows of cases of private companies where, owing to the limited membership, it is not possible to get a proxy who is a member to represent anybody in the event of a shareholder being ill. There are countless cases of small private companies with not more than two or

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three members altogether, and put of two or three members you cannot find another proxy. So the conclusion I have come to, after hearing the various points of view, is that expressed in the Amendment which stands in the name of the noble Viscount, Lord Swinton, and myself.
I would like to emphasize very strongly what the noble and learned Viscount, Lord Maugham, has said about the representation of members by non-members in the case of public company meetings. We have, over many years between the wars, had experience of cases where proxies have been members, and of what might be termed almost the professional agitator coming in for self-interest, to advertise himself and very often to get business of a similar character—in other words, to exert himself as a nuisance. In the case of a public company that is obviously a thing that is to be deplored and must be stopped. In regard to the arguments for one course being adopted in respect of public companies and another being adopted in the case of private companies, especially those private companies that are exempt from the publication of their balance sheet and profit and loss account, I think there is a great deal to be said for the adoption of that compromise, in the form either of the Amendment which stands in the name of the noble Viscount and myself, or one similar to it.
VISCOUNT MAUGHAM: May I just interpose to say that, for my part—if I may say so with great respect to anybody who thinks that I am doing something wrong—I would be quite willing to accept the alteration to my Amendment which my noble friend, Lord Rennell, suggests, as regards private companies which are exempt under Clause 43. If that could be in some way put to the vote, it might be a way of clearing up the matter and satisfying nearly everybody here.
LORD BALFOUR OF BURLEIGH: Before the noble and learned Viscount replies, may I raise one point with reference to the Amendment of the noble Lord, Lord Rennell? I would ask the noble Lord whether his attention has been called to the special difficulties which this clause would make for the nominee companies of a bank, who at present are able to appoint proxies in respect of different holdings. A nominee company frequently
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holds shares on behalf of a number of different customers, and the present practice is to appoint several proxies. Has the noble Lord had his attention called to the effect this Amendment would have upon those nominee companies of a bank?
LORD ROCHESTER: Before the noble and learned Viscount replies, I would like to raise one further point. In the event of an agitation taking place in the case of a public company, unless the position is safeguarded it is quite possible that with all those agitators banding together, their voting strength on a poll might be doubled as against the ordinary shareholders. In other words, a member might attend and vote as a member, and also attend and vote as a proxy. If there were a sufficient number joining in such an agitation, they would be doubling the voting strength of those taking part in the agitation.
THE LORD CHANCELLOR: In that case you would ask for a poll.
LORD ROCHESTER: But in the case of a poll they would have the double voting value.
THE LORD CHANCELLOR: No; only on a show of hands. If you have 1000 shares and you send 1,000 proxies, to take an extreme case, on a show of hands that would count as 1000; but if you had a poll, all you would poll would be 1,000 votes. I have given a good deal of thought to this matter, and I confess that I do not think it is an easy one at all. In the course of my thoughts my mind has somewhat fluctuated. On the one hand I have started with this fact—and I do not like to disregard it—that the Cohen Committee, which consisted not only of very eminent lawyers but of very eminent business men, bankers, and so on, said this:
"We think that such proxy should be entitled to speak as well as vote. If not, the right loses a great deal of its value."
That is their recommendation, and obviously I am bound to attach great weight to it.
On the other hand, this is a complete revolution in our existing system, and though when I first heard the suggestion about proxies speaking I rather looked forward to a comfortable retirement, thinking that I might find some useful or, at any rate, some lucrative employment,

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on reflection I am bound to say that I do think that to allow it in the case of the public company would be going rather too far. The meetings would tend to be unduly long, and I am not certain that the results arrived at would be any more satisfactory than they are to-day. Then I thought to myself: Well, if that is so, is it not possible to devise some sort of test? There are some sorts of questions with regard to which this might be allowed, and other questions in regard to which it should not be allowed. I asked myself whether some test could not be devised and, frankly, I came to the conclusion that it could not, except the somewhat crude test—and I admit it is a crude test—of adopting it after paying regard to the nature of the company. I admit that it is a compromise and, like all compromises, I am not sure that it is wholly logical. I think the best compromise is to say that we will allow this to take place in the case of the private company but we will not allow it in the case of the public company.
I considered whether we should confine it still further and allow it only in the case of the exempted private company. I say, frankly, that I feel quite certain that after we have passed this Bill, after we have got it consolidated, we shall learn a good deal. We shall have to find out where the shoe pinches, and where Amendments must be made. On the whole, I came to the conclusion that to confine this to the exempted private company at this stage would be a bit too narrow. The distinction between the exempted private company and the private company turns on a rather narrow and, one might say, artificial difference. That means that we had better say we will allow it in the case of a private company but we will not allow it in the case of the public company.
A NOBLE LORD: That is, the right to speak?
THE LORD CHANCELLOR: That is, the right to speak. That is the suggestion I make to your Lordships. Therefore, I would ask you not to accept this Amendment proposed by the noble and learned Viscount, Lord Maugham. In due course, when we get to the Amendment standing in the name of the noble Viscount, Lord Swinton, and the noble Lord, Lord Rennell—that is the one on page 5, line 36
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—I shall ask your Lordships to accept it. It limits the right of the proxy to speak to the case of the private company. The noble Lord, Lord Balfour of Burleigh, asked me a question with regard to the proxies which banks send. I say frankly that I had not had that point brought to my attention, but I shall be pleased to look into it and to see whether any difficulty arises there. I quite appreciate, of course, that representing, as they do, different clients, they may have different instructions and they may therefore have to send different proxies to take different sides. I will look into it to see if there is a difficulty there, and if there is I will do what I can to surmount it.
VISCOUNT SWINTON: Would that not be covered by the Amendment proposed by the noble Lord, Lord Rennell, on page 6, line 39, which asks that the proviso should be deleted?
THE LORD CHANCELLOR: I am going to advise your Lordships to accept that Amendment. It may be that that will take care of this point.
VISCOUNT MAUGHAM: In the circumstances, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
VISCOUNT SWINTON: I beg to move the next Amendment.
Amendment moved—
Page 5, line 36, after the first ("member") insert ("of a private company").—(Viscount Swinton.)
On Question, Amendment agreed to.
LORD RENNELL LORD RENNELL moved to leave out the proviso in subsection (5). The noble Lord said: This probably refers to the point raised by the noble Lord, Lord Balfour of Burleigh. At the bottom of page 6 there is a proviso on the subject of voting by proxies. Subsection (5) provides that proxies may vote in more than one way, according to their directions or the persons they represent. The proviso in itself is not very clear to me. I am not quite clear what its object is and what danger it purports to guard against. It seems to be fairly clear that the provisions of subsection (5), omitting the proviso, are necessary, especially in the case of nominee companies, trust corporations and trustees who may be called upon by the persons for whom they act to vote both for and against a resolution, according to

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the interests of the persons they represent. That is quite right. It arises very clearly in the case of corporate trustees as well as private trustees. If, as I understood the noble and learned Viscount to say just now, my proposal to omit the proviso is accepted, I have no more to say. I beg to move.
Amendment moved—
Page 6, line 39, leave out lines 39 to 44.—(Lord Rennell.)
LORD BALFOUR OF BURLEIGH: May I be quite sure what happened just now? I gather that in the case of a public company more than one proxy now can be appointed. If these lines are left out, I think that completely meets the situation. I should be very much obliged to the noble and learned Viscount if he would explain what those five lines meant when they were there.
THE LORD CHANCELLOR: As I am going to accept this Amendment, wild horses would not make me waste your Lordships' time by telling you what these lines meant. It is sufficient to say that although I accept this Amendment, I am afraid it may involve consequential Amendments on the Report stage, in order to adapt the clause to cases where there are provisions (Section 153 of the Companies Act is an illustration) referring to a majority in number representing three-quarters in value. We may have to have consequential Amendments, but so far as this Amendment is concerned, I accept it.
LORD RENNELL: I am much obliged to the noble Viscount. There are, of course, obvious consequential Amendments.
VISCOUNT SWINTON: May we be quite clear what it is we are doing? Certainly nothing we have done so far affects the number of proxies you can appoint. If you have twenty shares and like to fill up the room, you can appoint twenty proxies, so long as they do not on a poll cast more than twenty votes. We have not been concerned with that at all. Therefore it will be perfectly competent, in either a public or a private company, if' two conflicting interests are represented, to appoint two proxies. Whether the votes are given by the members themselves or by one or more proxies, they can be cast in exactly the way in which the
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proxies have received their directions. There is nothing to stop a trustee, if he is there in person, or a proxy, in accordance with his duty and the interests of his beneficiaries, from casting one vote one way and another vote in another way. In the same way, where directors have been appointed proxies in the ordinary way before a general meeting and have received a large number of proxies—some of which may be in favour of a proposition and some against it—the wishes of the members will be carried out by the directors casting their votes on a poll in accordance with the wishes expressed on the proxy forms. That, I take it, is what we intend to do by the Amendments, and that seems to me to be obviously fair and just. Is that correct?
THE LORD CHANCELLOR: That is correct. I quite agree with the noble Viscount.
On Question, Amendment agreed to.
Clause 5, as amended, agreed to.
Clause 6 [Meetings attended by single member]:
LORD COZENS-HARDY: This is only a drafting Amendment. It does not seem clear whether it is intended that directions which may be given "do include," "may include," or "shall include." I beg to move.
Amendment moved—
Page 7, line 13, at beginning insert ("shall").—(Lord Cozens-Hardy).
LORD CHORLEY: I am very glad to give a morsel of comfort to the noble Lord who has so far been sent empty away. We are very much obliged to him for pointing this out. The only thing is that the word "may" should be inserted and not the word "shall." Perhaps he will accept that.
LORD COZENS-HARDY: Yes.
On Question, Amendment, as amended, agreed to.
Clause 6, as amended, agreed to.
Clause 7 agreed to.
Clause 8:
Alternative remedy to winding up in cases of oppression.
8.—(1) Any member of a company who complains that the affairs of the company are being conducted not with a view to the interest of the whole body of members, but in a

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manner oppressive to some part of them (including himself), may make an application to the court by petition for an order under this section.
(2) If on any such petition the court is of opinion—

(a) that the company's affairs are being conducted as aforesaid; and

(b) that to wind up the company would unfairly prejudice that part of the members, but otherwise the facts would justify the making of a winding up order on the ground that it was just and equitable that the company should be wound up;

the court may, with a view to bringing to an end the matters complained of, make such order as it thinks fit, whether for regulating the conduct of the company's affairs in future, or for the purchase of the petitioner's shares by other members of the company, or for the surrender and cancellation of the petitioner's shares and the reduction accordingly of the company's capital, or otherwise.
(4) Any order under this section altering, or adding to, or giving leave to alter or add to, a company's memorandum or articles shall, within fourteen days after the making thereof, be delivered by the company to the registrar of companies for registration; and if a company makes default in complying with this subsection, the company and every officer of the company who is in default shall be liable to a default fine.
3.30 p.m.
VISCOUNT MAUGHAM VISCOUNT MAUGHAM moved, in subsection (1), after "conducted" to insert "contrary to the interests of the company or." The noble and learned Viscount said: This is not a very important Amendment, because I think the court would have power to deal with the matter if my words were not inserted, but it occurred to me that Clause 8 refers only to cases where some part of the body of members were acting in their own interests, and that it did not quite cover the cases where certain people were proposing something contrary to the interests of the company as a whole. To make it quite clear that in these cases application could be made to the court by a petition for an order under the section, it would be just as well to insert the words proposed. It is a very small Amendment, because in most of the cases the words as they are in the clause would meet the evil which the Amendment is designed to meet. However, I thought it might clarify the matter to add these words. I beg to move.
Amendment moved—
Page 7, line 24, after ("conducted") insert ("contrary to the interests of the company or").—(Viscount Maugham.)
THE LORD CHANCELLOR: I have put down two Amendments which I think would satisfy the noble Viscount. May I read the clause as it would be with my Amendments?
"Any member of a company who complains that the affairs of the company are being conducted in a manner oppressive to some part of the members (including himself), may make an application to the court."
I think in that way we get rid of the rather objectionable words, because, of course, the directors have to conduct the affairs of the company not merely with a view to the interests of the whole body of members but with a view to the interests of the company. I think that by omitting those words we get rid of the mischief to which the noble and learned Viscount, Lord, Maugham, has called attention. I hope the noble and learned Viscount will be satisfied with that suggestion, and will think that it improves the clause and meets the point he has been good enough to raise.
VISCOUNT MAUGHAM: Will the noble and learned Viscount tell me whether that covers a case where a member of the company complains that a proposal is being made which he can satisfy the court is one which will ruin the company—some hopelessly violent speculation which was not within the purview of the shareholders when the company was formed? Would that be covered by his words or would it not?
THE LORD CHANCELLOR: No, I do not think it would.
VISCOUNT MAUGHAM: It would not be oppressive to a particular person, but it would be quite wrong in the interests of the company as a whole, having regard to the objects of the company as they were originally defined by the prospectus.
THE LORD CHANCELLOR: If the case is ultra vires no doubt it could be stopped. If, on the other hand, it is intra vires it seems to me a matter for the company to decide and not a matter for the court to decide. That case, therefore, would not come within my words. My words hit only the case of the oppression of the minority. Where you have the oppression of the minority, then this clause will operate. I think the noble and learned Viscount will find that that is a better way of dealing with it than by inserting his words.
VISCOUNT MAUGHAM: I am not thinking of a case where the proposal is one ultra vires the company, because, of course, that could easily be stopped. The noble and learned Viscount knows perfectly well that under the modern form of Memorandum of Association a company which is formed to carry on some small tin mine in Cornwall can no doubt enter into the enormous transaction of trying to find diamonds in Bolivia. There is practically nothing that you cannot do under the modern Memorandum of Association. I am thinking of a case where, not long after the formation of a company, we will say for legitimate tin mining in Cornwall, the directors think fit to embark on an enterprise which nobody ever thought of when the company was formed. That is not ultra vires. I would not be sorry if Clause 8 of this present Bill were so worded that you could go to the company by petition and say: "This is humbug, because the company is being changed from its original intentions." Having said that, I hope the noble Viscount will consider the matter. To my mind it is a real point of value, but I do not think it is right for me at the present moment to insist upon my Amendment, and I therefore beg leave to withdraw it.
VISCOUNT SWINTON: May I suggest this? Is not really what my noble and learned friend has in mind a case where the members want to get rid of the board of directors? If they are conducting the business scandalously and foolishly there is the opportunity in general meeting, and indeed by a special resolution, to get rid of the board of directors. When we vote at an election no such opportunity presents itself year by year. I suggest that it would place the court in an extraordinarily difficult position if, whenever any part of the shareholders thought that the business was being badly or foolishly conducted, they could then apply to the court. Would that not really be making the Court of Chancery and the Company judge almost the manager of any business which happened to be taken there? That was never contemplated. If there is a bad management it has to be sacked by the shareholders and not dealt with by the court.
LORD SIMONDS: I would like to support what the Lord Chancellor has just said. I doubt very much the wisdom
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of allowing the court to intervene except in one of two circumstances. One is, either that what is proposed is ultra vires, or secondly, that it is oppressive to a minority. That, of itself, is a sufficiently vague expression to cause enough trouble. I would hesitate very much to allow the court to go further and intervene if it was satisfied that something was not in accordance with the general interest of the members, or something of that kind. Therefore, I would carry what aid I may to the Lord Chancellor—although I do so with great diffidence, sitting beside the noble and learned Viscount, Lord Maugham.
THE LORD CHANCELLOR: I also differ with very great diffidence, but I would point out that it is plain that this clause is dealing with minorities, and the rubic says: "Alternative remedy to winding up in cases of oppression." I am quite certain we ought to confine this clause to what is called oppression of minorities, and not to extend it further. Myself, I think it would be unwise to invest the court with the duty of being a sort of super-manager, even although what is being done is within the vires of the company. I think the right course is to sack the board of directors.
LORD SALTOUN: Before we leave this point may I ask the noble and learned Viscount if there is any particular virtue in the words "(including himself)" being between brackets. Would he consider that another time?
VISCOUNT MAUGHAM: I have already asked leave to withdraw my Amendment, and I now ask leave to withdraw it again.
Amendment, by leave, withdrawn.
THE LORD CHANCELLOR: The next is the Amendment which I indicated just now, which makes it plain that the proper way in which to consider this matter is that the directors have to act in the interests of the company. The effect of this Amendment and the succeeding one is to achieve this end. I beg to move.
Amendment moved—
Page 7, line 24, leave out from ("conducted") to ("in") in line 25.—(The Lord Chancellor.)
On Question, Amendment agreed to.
LORD CHORLEY: The next is a drafting Amendment.
Amendment moved—
Page 7, line 26, leave out ("them") and insert ("the members").—(Lord Chorley.)
On Question, Amendment agreed to.
LORD CHORLEY: This also is a drafting Amendment. As the clause stands, it might be thought to imply that when the purchase of the petitioner's shares by other members of the company takes place, there would be a reduction in capital. The proposed words have been suggested in order to prevent that construction of the clause. I beg to move.
Amendment moved—
Page 8, line 1, leave out ("for the surrender and cancellation of the petitioner's shares and") and insert ("by the company and, in the case of a purchase by the company, for").—(Lord Chorley.)
On Question, Amendment agreed to.
LORD CHORLEY: With reference to the next Amendment, subsection (4) provides that where on the application of oppressed minority shareholders the court make an order regulating the conduct of the company, or something of that kind—possibly an alteration or an addition to the Memorandum or Articles of the company—the order made by the court must be filed with the Registrar of Companies. Quite obviously, it would not be equally convenient to file the order itself, and the Amendment requires instead that the office copy shall be filed. Obviously this is very much for the convenience of the company, and there are already precedents for it. In these circumstances I hope your Lordships will insert the Amendment, which I beg to move.
Amendment moved—
Page 8, line 16, at beginning insert ("an office copy of").—(Lord Chorley.)
On Question, Amendment agreed to.
LORD CHORLEY LORD CHORLEY moved, at the end of subsection (4), to insert the following new subsection:
"(5) In relation to a petition under this section, section three hundred and five of the principal Act (which confers power among other things to regulate the procedure and fees on winding-up petitions) shall apply as it applies in relation to a winding-up petition."
The noble Lord said: This Amendment makes procedure on petition under Clause 8 subject to the rules made, in the same way as winding-up rules, and not to the ordinary rules of court. Clause 8 gives to the court wide discretion to make orders in the case of the oppression of minority
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shareholders, and to a large extent questions arising will be identical with those which a court has to decide in connexion with a petition to wind-up a company on the grounds that it is just and equitable to do so. The petitioner may well wish to ask for both forms of relief in the alternative. The Cohen Report is not perfectly clear, but it rather seems to take the view that the relief for which Clause 8 provides should be granted only on a winding-up petition. It does seem that, on balance, it should not be confined to a winding-up petition but that the right to make these applications, should exist in good cases and apart from such petitions. In the circumstances, I hope that the Amendment will receive the approval of your Lordships. I beg to move.
On Question, Amendment agreed to.
Clause 8, as amended, agreed to.
Clause 9:
Extension of time limit under s. 61 (2) of principal Act.
9. In subsection (2) of section sixty-one of the principal Act (which limits the time allowed a dissenting minority for applying to the court to cancel a variation of the rights attaching to any particular class of shares to seven days after the agreement of the majority is given) for the words "seven days" there shall be substituted the words "twenty-one days":
VISCOUNT MAUGHAM VISCOUNT MAUGHAM moved to leave out "twenty-one days" and insert "fourteen days" The noble Viscount said: This Amendment was put down only to make sure that the point was considered. I may say that I have had a great deal to do with the alteration of rights of shareholders where there has been a dissenting minority, and it is quite clear that the Cohen Committee did right in thinking that seven days was not long enough to allow a dissenting minority to apply to the court. It really did not give them sufficient time. I quite agree with the Committee, but I think it would probably be enough if the time were extended to fourteen days. I could not quite see why the Cohen Committee jumped to the conclusion that three times the previous period should be allowed. After consideration, however, it has been thought that the Cohen Committee's suggestion is the one which should guide the House. I should therefore be quite willing to withdraw my Amendment, because I do not consider it is of particular importance. I beg to move.
Amendment moved—
page 8, line 28, leave out ("twenty-one") and insert ("fourteen")—(Viscount Maugham.)
THE LORD CHANCELLOR: As between twenty-one and fourteen days I have only this to say. The Cohen Committee recommended twenty-one days, and when we bear in mind that the minority shareholders have to secure a total of 15 per cent.—which needs a bit of organizing—it seems to me there is no good ground for saying that the recommendation of the Cohen Committee should not be adhered to. We have looked into this matter, and we came to the conclusion it was better to stick to twenty—one.
VISCOUNT MAUGHAM: In these circumstances, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 9 agreed to.
Clause 10:
Acquisition of shares of shareholders dissenting from scheme or contract approved by majority.
10.—(1) In subsection (1) of section one hundred and fifty-five of the principal Act (which enables a company, where a scheme or contract involving the transfer to it of shares in another company has been approved by the holders of nine-tenths in value of the shares affected, to acquire the shares of the dissentients) the reference to the shares affected shall be taken as referring only to the shares whose transfer is involved, and as not including shares already held at the date of the offer by the transferee company or a nominee for it.
(2) Except where either there are no shares held as aforesaid, or the shares held as aforesaid (or, in the case of a scheme or contract relating to a class of shares, such of the shares held as aforesaid as are of that class) are not of a value greater than one-tenth of the aggregate of their value and that of the shares affected, the said subsection (1) shall apply only if—

(a) the transferee company offers the same terms to all holders of the shares affected or, where those shares include shares of different classes, of each class of them; and

(b) the holders who approve the scheme or contract, besides holding not less than nine-tenths in value of the shares affected, are not less than three-fourths in number of the holders of those shares.

(3) Where in pursuance of any such scheme or contract as is mentioned in the said section one hundred and fifty-five shares in a company are transferred to another company or its nominee, and those shares together with any other shares in the first-mentioned company held by the transferee company or a nominee for it at the date of the transfer comprise or include nine-tenths in value of the shares in the first-mentioned company or of any class of those shares, then—
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(a) the transferee company shall within one month from the date of the transfer (or the first such transfer) give notice of that fact in the prescribed manner to the holders of the remaining shares or of the remaining shares of that class, as the case may be, who have not assented to the scheme or contract; and
(5) In subsection (2) of the said section one hundred and fifty-five (which enables the transferee company, if dissenting shareholders after being given notice under subsection (1) of the company's desire to acquire their shares fail to transfer them, to become registered as holder thereof, without execution of any instrument of transfer, on transmitting to the transferor company a copy of the notice requiring the transfer and on complying with certain other requirements), after the words "transmit a copy of the notice to the transferor company" there shall be inserted the words "together with an instrument of transfer executed on behalf of the shareholder by any person appointed by the transferee company and on its own behalf by the transferee company."
VISCOUNT SWINTON VISCOUNT SWINTON moved, in subsection (1), to leave out "by the transferee company or a nominee for it "and to insert" by, or by a nominee for, the transferee company or its subsidiary." The noble Viscount said: In a sense, this is a technical Amendment, but I think one of some substance. Clause 8 has given this wider protection to minorities. I had a number of Amendments suggested to me but I think almost every suggestion made is amply met 'by the excellent provisions in subsection (2) of Clause 8, which enables a court, if a minority is being in any way oppressed, to make whatever order it thinks right in the circumstances. That seems to me much better than trying to provide in detail for a whole heap of circumstances by a great many provisions, none of which in the event may exactly meet the particular case.
Clause 10, however, does deal with a particular prohibition. Let us suppose that there is a proposal that all shares in Company A should be transferred to Company B, which I will call the transferee company. It has always been allowed, and it is confirmed and reinforced here, that that may be done if you get 90 per cent of the shares voting. It is possible to compel the dissentient to come in. But this clause reinforces the provision of the old Act which provides that if the transferee company hold shares in Company A, it is not allowed to count the shares in ascertaining whether there is a 90 per cent. vote. That is obviously

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right, because they have a vested interest in trying to get hold of the rest of the shares. They are a very directly interested party.
Clause 10 provides that any nominee of the transferee company may not count its shares. You may have cases—I know such cases have arisen—where shares are not held by the transferee company or nominee company but by some subsidiary or associated company, which is just as directly interested as the transferee company itself. Obviously, whatever form this second company takes, if it is under the direction, or can be placed under the direction of the interested transferee company, its shares ought not to count in the voting. Therefore, I beg to move my Amendment.
Amendment moved—
Page 8, line 39, leave out ("by the transferee company or a nominee for it") and insert ("by, or by a nominee for, the transferee company or its subsidiary").—(Viscount Swinton.)
LORD CHORLEY: I am glad to say that we shall be pleased to accept this Amendment. It does dot the "i's" and cross the "t's," and improves the clause.
On Question, Amendment agreed to.
LORD CHORLEY: This is a mere drafting Amendment filling out this particular clause. I beg to move.
Amendment moved—
Page 8, line 41, leave out from beginning to ("a") in line 1 on page 9, and insert ("Where shares in the transferor company of the same class or classes as the shares affected are held as aforesaid to").—(Lord Chorley.)
On Question, Amendment agreed to.
VISCOUNT SWINTON: This is consequential upon the Amendment which has just been accepted. I beg to move.
Amendment moved—
Page 9, line 17, leave out ("by the transferee company or a nominee for it") and insert ("by, or by a nominee for, the transferee company or its subsidiary").—(Viscount Swinton.)
On Question, Amendment agreed to.
LORD CHORLEY: This is another drafting Amendment. As the clause is drafted, it suggests that the transferee company has to give notice, within one month of the first transfer of shares to it, of the fact that it holds nine-tenths in value of the shares in the transferor com
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pany, whereas the first such transfer might occur before the transferee company had acquired nine-tenths in value of the shares. I beg to move.
Amendment moved—
Page 9, line 22, leave out ("or the first such transfer") and insert ("unless on a previous transfer in pursuance of the scheme or contract it has already complied with this requirement").—(Lord Chorley.)
On Question, Amendment agreed to.
3.56 p.m.
LORD CHORLEY LORD CHORLEY moved at the end of subsection (5), to insert:
"and at the end of the said subsection there shall be added the following proviso:—
'Provided that an instrument of transfer shall not be required for any share for which a share warrant is for the time being outstanding."
The noble Lord said: This Amendment exempts bearer shares from Clause 10 (5). Clause 10 (5) provides that where in pursuance of a scheme which under Section 155 of the Companies Act has been accepted by 90 per cent. of the members of a company for the transfer of their shares to another company, the latter company compulsorily acquires shares of a dissenting minority; the necessary instrument of transfer has to be executed, naturally, on behalf of the shareholder on the one hand, and by the company which is acquiring the shares on the other. It is not appropriate that this procedure should apply in the case of bearer shares, which are not susceptible of this sort of treatment, and the Amendment proposed is to remove bearer shares from the ambit of the subsection. I beg to move—
Amendment moved—
Page 10, line 7, at end insert the said words.—(Lord Chorley.)
On Question, Amendment agreed to.
Clause 10, as amended, agreed to.
Clause 11:
Books of account.
(2) A company shall not be deemed to comply with the requirements of the said section one hundred and twenty-two by keeping books of account at a place outside Great Britain, unless there are sent to, and kept at a place in, Great Britain and are at all times open to inspection by the directors such returns, made out for periods of three months or less, of the contents of the books of account kept at any place outside Great Britain as will disclose all information material for the purpose of preparing the next profit and loss account and balance sheet.
LORD DE L'ISLE AND DUDLEY LORD DE L'ISLE AND DUDLEY moved to leave out subsection (2) and insert:
(2) Where a company carries on business at one or more places outside Great Britain there shall be kept at the registered office of the company in Great Britain or at such other place or places in Great Britain as the directors may decide, such accounts and returns from the business carried on as shall disclose with reasonable accuracy the financial position of such business at intervals not exceeding three months and shall enable the company to prepare a balance sheet and profit and loss, or income and expenditure, account required by this Act.
The noble Lord said: The Amendment which stands in my name is really one of drafting more than one of principle. My intention has been to carry out what is obviously meant by this Clause of the Bill, but it seemed to me that the words of the Cohen Committee Report would do so in a more workmanlike way than the words which are actually in the Bill as drafted. The words in the Bill might imply that a company making returns from a foreign branch would have to take stock every three months. That would obviously be an onerous provision and would cause unbusiness-like procedure. I suggest that it is not a provision which ought to be allowed in the Bill. The actual words in the clause are:
"As will disclose all information material for the purpose of preparing the next profit and loss account and balance sheet."
As I read those words it might mean taking stock in the way I have suggested. There may be some strong reasons why the words in the first part of the clause should be as they are, but, reading the two side by side, it seemed to me that the wording of the Cohen Report was simpler and more straightforward. I beg to move.
Amendment moved—
Page 10, line 20, leave out subsection (2) and insert the said new subsection.—(Lord de L' Isle and Dudley.)
THE LORD CHANCELLOR: In substance, I agree with the noble Lord, but not with the actual form of his Amendment, the wording of which, I think, comes straight out of the Cohen Report. It is defective, I suggest, because it does not bring in the pains and penalties of Section 122 of the Companies Act. That section is the section which provides that a company must keep proper books of account, and provides penalties for not doing so. The effect of those words in
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the first part is, of course, to bring in the Penalty Clause of Section 122. When we get past that opening, I agree with the noble Lord. I think that his words which, as I say, I believe are the wards of the Cohen Report—are preferable to our words. What we have endeavoured to do is to combine the good features of both. Your Lordships will see that I have put down an Amendment to page 10, line 24, to leave out from "such" to the end of the clause and insert certain new words. I think the new words are the ones which the noble Lord has in mind. So what will happen is that after our introduction, those words will go in. I consider that in that way we combine the best of both these features. If the noble Lord is prepared to accept my Amendment, I think we shall both be satisfied.
LORD COZENS-HARDY: After the noble and learned Viscount, the Lord Chancellor, has considered the wording of this clause, I should be grateful if he would direct his attention to one other matter. Some companies make a practice of having half-yearly meetings, and I suggest that where those half-yearly meetings have before them audited accounts, it is unnecessary to call upon the company to furnish quarterly un-audited accounts and returns.
THE LORD CHANCELLOR: I will look into that.
LORD DE L'ISLE AND DUDLEY: In view of what the noble and learned Viscount, the Lord Chancellor, has said, I will certainly withdraw my Amendment. It is clear that the compromise which the noble and learned Viscount has outlined will meet the case. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
THE LORD CHANCELLOR: This next Amendment is the Amendment to which I have referred, bringing in the noble Lord's wording. I beg to move.
Amendment moved—
Page 10, line 24, leave out from ("such") to the end of the clause and insert ("accounts and returns with respect to the business dealt with in the' books of account kept outside Great Britain as will disclose with reasonable accuracy the financial position of that business at intervals not exceeding three months and will enable the company's balance sheet and

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profit and loss account to be prepared in accordance with the principal Act and this Act").—(The Lord Chancellor.)
On Question, Amendment agreed to.
LORD HAWKEhad given notice that he would move, in subsection (2), to leave out from "all," where that word last occurs, to the end of the subsection and insert: "material information which could reasonably be required if the books were kept in Great Britain." The noble Lord said: I do not propose to move this Amendment at this stage, but I want to have a more careful look at what the noble and learned Viscount said in replying to a previous Amendment.
Clause 11, as amended, agreed to.
Clause 12:
Periodical accounts (including consolidated accounts of group.)
(2) Where the company is a holding company, there shall with every balance sheet and profit and loss account laid before the company in general meeting be laid also

(a) a consolidated balance sheet dealing with the state of affairs as at the end of the company's financial year of the company and its then subsidiaries; and

(b) a consolidated profit and loss account dealing with the profit or loss of the company's financial year of the company and those subsidiaries;

and the holding company shall secure that, so far as practicable, the financial year of each of its subsidiaries shall coincide with its own financial year:
Provided that, if in the opinion of the company's directors it is impracticable or would be misleading for any subsidiary to be dealt with in the consolidated accounts, those accounts shall relate only to the company and the other subsidiaries or, if there are no other subsidiaries, consolidated accounts shall not be required.
(3) The balance sheet and profit and loss account of every company shall comply with the requirements of Part I of the First Schedule to this Act, and the balance sheet and profit and loss account of a holding or subsidiary company and any consolidated accounts of a holding company shall comply with the requirements of Part II of that Schedule:
Provided that—

(a) the said Part I shall, in the case of a company which is a holding company, be subject to the provisions of paragraph 1 of the said Part II;

(b) the said Parts I and II shall, in the case of any such company as is referred to in Part III of that Schedule, be subject to the provisions of the said Part III; and

(c) the said Parts I, II and III shall be construed in accordance with the provisions of Part IV of that Schedule.

(5) If any person being a director of a company fails to take all reasonable steps to secure compliance as respects the accounts of the company with the provisions of this section and with the other requirements of the principal Act and this Act as to the matters to be stated in accounts, he shall, in respect of each offence, be liable on summary conviction to imprisonment for a term not exceeding six months or to a fine not exceeding two hundred pounds:
Provided that a person shall not be sentenced to imprisonment for any such offence unless in the opinion of the court dealing with the case the offence was committed wilfully.
THE LORD CHANCELLOR: The next Amendment is a mere drafting Amendment, and it has the effect of defining consolidated accounts. I beg to move.
Amendment moved—
Page 10, line 36, at end insert ("consolidated accounts comprising").—(The Lord Chancellor.)
On Question, Amendment agreed to.
LORD CHORLEY LORD CHORLEY moved, in subsection (2) (b), to leave out "so far as practicable" and insert "except where in the opinion of the company's directors there are good reasons against it". The noble Lord said: This Amendment has been designed to meet the following Amendments in the names of the noble Viscount, Lord Swinton, and the noble Lord, Lord Rennell. Clause 12, subsection (2), provides that the holding company shall ensure, so far as practicable, that its financial year and that of its subsidiaries shall coincide. It is understood that in certain cases, particularly those where foreign subsidiaries are involved, this may give, rise to difficulty, especially in taxation matters. Therefore we have put down these words which will give the directors in a proper case an opportunity of making arrangements to meet that difficulty.
Amendment moved—
Page 11, line 1, leave out "so far as practicable" and insert the said new words.—(Lord Chorley.)
VISCOUNT SWINTON: I am very much obliged to the noble Lord for putting down this Amendment. I think it is an improvement on mine, and I venture even to think that it is an improvement on Lord Rennell's, because it is only the directors who can say whether there are any good reasons, and certainly this clause should be left reasonably flexible. "Practicable" is a very popular word, but I am not at all sure that you can define it. I am not sure that there is very much difference

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between "practicable" and "physically possible". I suppose that if a thing were very inconvenient but could be done, it would be practicable because you could do it; but it certainly might not be desirable. Unquestionably that would be far too strict a test to put upon this matter. After all, what we desire to do here is to get, full and complete consolidated accounts, and to do that in a way which not only gives information to the shareholders but, equally, is in the best interests of the company and, therefore, of the shareholders. Therefore it might be practicable and physically possible to produce all these accounts on one day, but extremely disadvantageous to the company.
The noble Lord has raised the question of foreign companies. I know from my own experience that if you were to alter the dates of accounts of a number of existing foreign companies who are subsidiaries of British companies, the result would be to attract a very large measure of additional taxation. That might be of benefit to the foreign exchequer, but it certainly would not be of any benefit to the British holding company. I could take other examples, but in the same way difficulties do not exist only outside this country. I can think of a number of cases where it is undoubtedly more convenient to close the subsidiary accounts a month, say, before the close of the year of the accounts of the holding company. It certainly may be more convenient where these accounts are in a Colony or a Dominion. What this Amendment does is to say that the general rule should be that the accounts shall have a uniform date, but where, in the opinion of the directors, it would be contrary to the interests of the company that they should have a uniform date, then they should have the date the directors of the managing company consider is in their best interest. I think it is obvious and in all good sense.
LORD RENNELL: I entirely agree with what the noble Viscount has said, and in due course I shall beg leave to withdraw my Amendment.
On Question, Amendment agreed to.
LORD CHORLEY LORD CHORLEY moved, in the proviso to subsection (2), after "accounts," where that word first occurs, to insert:
"or if on the application or with the consent of those directors the Board of Trade so direct
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on the ground that it is not required in the interests of members of the company or in the public interest that the subsidiary should be so dealt with".
The noble Lord said: There are really two Amendments here which go together, and I propose to deal with them together. The clause requires the holding company to prepare consolidated accounts, with a proviso that if, in the opinion of the company's directors, it is impracticable or would be misleading, they may omit from those accounts any subsidiary. There has been a certain amount of criticism of this proviso on the grounds that it is thought to be insufficiently elastic. For example, it may give a company a very great deal of trouble to consolidate with its own accounts the accounts of a solitary subsidiary in which its interest was a very small one in relation to its own total assets as a holding company. These two Amendments have been designed to overcome that difficulty, and I hope your Lordships will agree that they successfully do so. I beg to move.
Amendment moved—
Page 11, line 6, after the first ("accounts") insert the said new words.—(Lord Chorley).
On Question, Amendment agreed to.
LORD CHORLEY: The next Amendment I have already referred to. I beg to move.
Amendment moved—
Page 11, line 9, at end insert ("but where a subsidiary is not dealt with in consolidated accounts by virtue of a direction of the Board of Trade, the company's accounts shall give with respect thereto such information, if any, as may be required by the direction as a condition of the subsidiary not being so dealt with.")—(Lord Chorley.)
On Question, Amendment agreed to.
VISCOUNT SWINTON VISCOUNT SWINTON moved, at the end of subsection (2), to insert:
"and provided also that where the accounts of any subsidiary company have been dealt with in the consolidated accounts of a holding company, such subsidiary company shall not be required to furnish consolidated accounts in relation to itself and its then subsidiaries."
The noble Viscount said: This is a rather complicated-looking Amendment to a rather complicated clause, and I do not know if I have put the words into the best form. We all agreed that the idea is that there shall be a consolidated account which shows a true picture of the holding company and its subsidiaries and its sub-subsidiaries, if sub-subsidiaries there be. I do not know whether I have read the

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clause aright, and have been rightly advised, but, as my friends and I read it, it appears to me to say that there must be not only that consolidated account to give the full picture of the holding company and all its subsidiaries, but one for the subsidiary company which has sub-subsidiaries—grandchildren, if I may put it in more colloquial terms. No useful purpose would be served by demanding that the grandfather should have to get out a whole set of consolidated accounts relating to the sons and to the grandsons. I think that will make my meaning clear.
I leave aside the case where a so-called subsidiary company may have a great many outside shareholders as well as the holding company. In that case, no doubt, it may be necessary for the interest and information of the outside shareholders to have consolidated accounts. Leaving aside that case, where some useful purpose would be served by this multiplication of consolidated accounts, surely a company should not be forced, if that be the effect of the Bill, to produce such consolidated accounts if it is producing a satisfactory consolidated account for the main company and all the other companies which radiate from it. I beg to move.
Amendment moved—
Page 11, line 9, at end insert the said proviso.—(Viscount Swinton.)
LORD CHORLEY: I hope that the noble Viscount will not press this Amendment too hard. I quite appreciate the point which he has made, that a certain amount of extra work might be involved by this clause when and if the Bill becomes law. On the other hand, if it is accepted, the Bill would have the effect of creating a class of holding company which would be required to submit consolidated accounts. Clause 13 of the Bill, which defines "holding company" and "subsidiary," does so by reference to effective control of the subsidiary by the holding company. In practice it is possible for there to be a very substantial number of shareholders quite apart from the holding company, and if the subsidiary were itself a holding company, its members, other than its own holding company would not receive information concerning their investments to which they would be entitled. With regard to the suggested difficulty about the preparation of the accounts, in actual fact we feel
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that this is very largely imaginary; there should not be any great difficulty in preparing consolidated accounts for the intermediate holding company, because practically the whole of the information, if indeed not the whole of it, will be required in order to prepare the consolidated accounts of the group as such. In those circumstances all the material would be there, and there should not be so very much difficulty in preparing the separate series of accounts which are called for. I do not know whether the noble Viscount feels he should press his Amendment. If he would like us to do so, we certainly would be prepared to consider the matter further between now and the Report stage.
LORD RENNELL: Might I add one thing? My main object in supporting this Amendment, or something like it, is to try to save unnecessary work. That is the sole object of it. There is no question of concealing the activities of subsidiaries. Perhaps some method could be devised whereby groups of companies—and there are certain groups which obviously leap to the mind—would not be obliged to publish unnecessary consolidated accounts where there are no outside shareholders and where nobody would be any the wiser. I hope that the noble and learned Viscount will find some method between now and the Report stage to achieve that object.
THE LORD CHANCELLOR: I will look into this between now and the Report stage. I am at one with the noble Viscount in his desire.
VISCOUNT SWINTON: I am much obliged, because I did not feel that the answer was completely convincing. In moving this Amendment, I said I wanted there to be the fullest possible information where there were any outside shareholders. The noble Lord, Lord Rennell, has supported me in this matter. I do not want companies, which are terribly overworked to-day, with small staffs, and which will have an enormous amount of work put upon them by this Bill when it becomes law, to have unnecessary work. It is not quite good enough, if I may respectfully say se, to say: "Well, it will put a certain amount of extra work upon you which will not serve any useful purpose in the case of these, wholly-owned subsidiaries, but you ought to put up with it because we want to deal with

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quite different companies where there are a number of outside shareholders." With great respect to the noble and learned Viscount, the right way of doing it is not to make the path of these companies harder by putting a lot of extra work upon them. It is for the ingenuity of the Companies Department of the Board of Trade and the Parliamentary draftsmen so to devise a clause that the companies which, in the public interests, ought to keep these accounts are required to keep them, and the others go free. I hope that something may be done.
LORD CHORLEY: The noble Lord has suggested a possible way which will enable the draftsmen to obtain the desired end. We shall certainly be very glad to consider it.
VISCOUNT SWINTON: I want to be helpful and I withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD CHORLEY LORD CHORLEY moved, after subsection (2), to insert:
"(3) Where it appears to the Board of Trade desirable for a holding company or a holding company's subsidiary to extend its financial year so that the subsidiary's financial year may end with that of the holding company, and for that purpose to postpone the submission of the relevant accounts to a general meeting from one calendar year to the next, the Board may on the application or with the consent of the directors of the company whose financial year is to be extended direct that, in the case of that company, the submission of accounts to a general meeting, the holding of an annual general meeting or the making of an annual return shall not be required in the earlier of the said calendar years."
The noble Lord said: This Amendment is intended to remove a little difficulty. If a company makes the financial year of its subsidiaries coincide with its own financial year, as it is intended it should do in the ordinary case, it may result in the accounts of a company not being ready presentation before the end of a calendar year in which the company is under an obligation, under Section 123 of the Companies Act, to submit them to a general meeting. The subsection which the Amendment proposes to insert gives discretion to the Board of Trade to waive the requirements of the Act as to the submission of accounts to a general meeting under Section 123, the holding of an annual general meeting under Clause 1, or the making of an
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annual return under Section 108 of the Companies Act. This is all in the way of granting greater elasticity and will, I am sure, meet with the 2.pproval of your Lordships. I beg to move.
Amendment moved—
Page 11, line 9, at end insert the said subsection.—(Lord Charley.)
LORD RENNELL: If I may say so, this is an extremely helpful Amendment, and I am sure that everybody will agree to it.
On Question, Amendment agreed to.
LORD CHORLEY: The next Amendment gives the Board of Trade discretion to modify the requirements of the First Schedule which relate to the contents of the balance sheet, the profit and loss account and the consolidated accounts so as to suit the needs of particular companies. As it stands, the Bill contains such power in Paragraph 8, Part II of the First Schedule, but it is limited to the provisions relating to the consolidation of accounts. In view of the experimental nature of very many of the requirements and the probability that in practice they may not prove to be equally suitable to all companies, it is again thought that wide discretion should be conferred in order that we may see how the thing works out when it comes to be dealt with in practice. In those circumstances I am sure your Lordships will agree that this is a useful Amendment. I beg to move.
Amendment moved—
Page 11, line 25, at end, insert ("and Parts I and II of that Schedule shall, in relation to any company, have effect subject to such modifications as the Board of Trade on the application or with the consent of the company's directors may direct for the purpose of adapting them to the circumstances of that company").—(Lord Charley.)
On Question, Amendment agreed to.
VISCOUNT SWINTON VISCOUNT SWINTON moved, at the end of subsection (3), to insert the following new paragraph:
"The provisions of paragraph 5 of the said Part I shall not apply to the first consolidated balance sheet and consolidated profit and loss account prepared by a holding company after the provisions of this section come into force or to the first such balance sheet and profit and loss account prepared after the date on which a company becomes a holding company."
The noble Viscount said: I think the noble Lord will agree that this is an equally reasonable and practicable Amendment,

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The Schedule provides not only the form of the consolidated accounts to be presented, but that when the accounts are presented there shall appear in parallel (if I may paraphrase) what were the figures for the previous year. It is a very common practice now, and a very good practice, but if you took the Schedule and the clause as they stand what would happen would be this. After the appointed day, a first consolidated balance sheet would have to be produced by those who had not hitherto produced a consolidated balance sheet, and produced in the form which is prescribed in the Schedule. Then, side by side with that first consolidated balance sheet, there would have to come a table of figures showing what were the proper corresponding consolidated figures for the previous year.
In the case of a company which had not kept consolidated accounts like this it would mean that on the first year after the appointed day the company would have to produce not one consolidated balance sheet but two consolidated balance sheets, because, first of all, it would have to produce its balance sheet and profit and loss account for the year, and would then have to go back through all its previous accounts and produce a similar one in order to get the figures which would have to be shown in the left-hand column. I am sure that that is not intended, and that what is intended is that once you have started to produce a consolidated balance sheet year by year, as you produce each one you should give the corresponding figures of the previous year in the margin. This Amendment is only to make sure that two balance sheets do not have to be produced for the first occasion. I beg to move.
Amendment moved—
Page 11, line 25, at end insert the said paragraph.—(Viscount Swinton.)
LORD RENNELL: There is one thing I would like to say before the noble Lord replies. As it stands at present, I do not think the requirement can necessarily be achieved in certain cases, notably the case where a company which has not hitherto produced a consolidated balance sheet does so, let us say, in this present year, 1947, and for that purpose adjusts the financial years of the subsidiary companies to meet its financial year. It can do so for this year, when the financial years of the company itself and the subsidiaries
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have not yet terminated. But in order to produce the comparative consolidated balance sheet for the previous year it could not alter the financial years of the companies which had already closed, and it would, therefore, produce for the various companies a consolidated balance sheet relating to different financial years, and that would be misleading.
LORD CHORLEY: I am very much impressed by the arguments that have been adduced in favour of this Amendment, both by the noble Viscount, Lord Swinton, and by the noble Lord, Lord Rennell. While I am not quite sure that the words of the Amendment as tabled are exactly the right ones—it is a complicated matter, and I think the draftsmen should look at it again—I am very glad to say that we accept the principle lying behind the Amendment, and if the noble Viscount will withdraw it we will possibly table this actual Amendment or some alternative clause to meet the situation.
VISCOUNT SWINTON: I am obliged to the noble Lord, and I am content to leave it with complete confidence in the hands of the skilled draftsmen to produce what we all want. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
4.15 p.m.
VISCOUNT MAUGHAM VISCOUNT MAUGHAM moved, in subsection (5) after "company", where that word first occurs, to insert "wilfully and knowingly". The noble and learned Viscount said: This is an Amendment of a very important character and raises a general principle with which I venture to think the Bill, as it stands, does not accord at all. That principle has been adopted in the principal Act of 1929, which, of course, has been in force now for a great number of years. The point is this: Are directors to be liable to imprisonment and fine for a mere inability to carry out every one of the principles of book-keeping which are involved in Clause 11; or for inadvertence in some respect; or for an inability wholly to understand what accounts the company is bound, under Clause 11, to keep and to provide and exhibit for the benefit of the shareholders? Let me just remind your Lordships of this. We are here only amending the Companies Act, 1929. I would refer your Lordships to Section 122 of that Act. Not everybody has the Act in his hands, but

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I shall try and state Section 122, and two other sections to which I want to refer, with reasonable dearness. Section 122 states:
"Every company shall cause to be kept proper books of account with respect to"—
and then, reading on shortly,
"sums of money received and expended by the company all sales and purchases assets and liabilities,"
and so forth. Then it goes on, after providing that the books shall be kept at the registered office of the company:
"If any person being a director of a company fails to take all reasonable steps to secure compliance by the company with the requirements of this section, or has by his own wilful act been the cause of any default by the company there under, he shall, in respect of each offence, be liable on summary conviction to imprisonment for a term not exceeding six months or to a fine not exceeding two hundred pounds:
Provided that a person shall not be sentenced to imprisonment for an offence under this section unless, in the opinion of the court dealing with the case, the offence was committed wilfully."
In the present case we are departing from that, as I apprehend the clause, because we no longer say that it is only on the happening of a wilful act by the director that there is default and he gets fined or imprisoned. That is Section 122.
Now let me refer you to Section 365 of the principal Act. Section 365 refers, first, to a default fine, and defines it, and secondly, to officers who are in default. The first subsection is as follows:
"Where by any enactment in this Act it is prodded that a company and every officer of the company"—
that, of course, includes a director—
"who is in default shall be liable to a default fine, the company and every such officer shall, for every day during which the default, refusal or contravention continues, be liable to a fine not exceeding such amount as is specified in the said enactment, or, if the amount of the fine is not so specified, to a fine not exceeding five pounds."
Subsection (2) says that for the purpose of any enactment of this Act—and that will include, unless it is altered, as I apprehend it, Clause 12 which is now under consideration—which provides that an officer of a company who is in default shall be liable to a fine or penalty, the expression" officer who is in default" means any director, manager, secretary or other officer of the company who, knowingly and wilfully, authorizes or permits
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the default, refusal or contravention mentioned in the enactment. Now let me come to Section 372 of the principal Act, which carries out, in my opinion, the same idea that inadvertence is not to be punished. Section 372 says:
"If in any proceeding for negligence, default, breach of duty, or breach of trust against a person to whom this section applies it appears to the court hearing the case that that person is or may be liable in respect of the default but that he has acted honestly and reasonably, and that, having regard to all the circumstances of the case he ought fairly to be excused for the default that court may relieve him, either wholly or partly, from his liability on such terms as the court may think fit."
In subsection (2) of that section it is said:
"Where any person to whom this section applies has reason to apprehend that any claim will or might be made against him in respect of any negligence, default, breach of duty he may apply to the court for relief, and the court on any such application shall have the same power to relieve him.
Then it is said that the persons to whom the section applies are, amongst others, the directors of a company and the officers of a company. As I understand it, the principal Act was framed, as those sections show, upon the footing that you do not become liable either to a fine or to imprisonment unless you have wilfully and knowingly—or at any rate knowingly—disregarded the provisions of the Act. I am unable to find anything which justifies the idea that a man is guilty of a mis-demeanour if he misunderstands the provisions either of the principal Act or of the Act which will come into force when this is passed. I do not believe there is anybody who has listened to this debate who thinks it is easy to understand all these provisions, and I do not believe that there is anybody who will say that even a competent adviser will be able to tell him in every case what details he has to put into the accounts for the purpose of complying with Clause 11 of the present Bill.
It seems to me that, especially in cases where there are subsidiary companies and holding companies, it will be almost impossible to be certain exactly what has to be put into the books of accounts of a company. It is for that reason that I suggest there is a tremendously strong case, in regard to inadvertence in complying with the provisions of this Act, for saying that in such instances there is to be no liability. I will add that it will be

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in the very worst interests of companies if directors, after this Bill becomes law, are liable to be brought up either before the High Court or before a court of summary jurisdiction and charged with an offence which renders them liable either to a fine or to imprisonment. An honest man who acts as he best can in performing the very complex duties which may be enforced upon him by virtue of the present Bill ought to be free from worry or liability, or from the stigma attaching to a prosecution. In the ordinary criminal law, in 99 cases out of too the mens rea—the guilty mind—has to be established before a man can be found guilty of a crime. A fortiori is it not the case that a man who is acting as a director of a company ought not to be taken as liable under Clause 11 (or, I would add, some of the other clauses we shall reach later on) unless he has knowingly omitted something which he knew he ought to do to carry out the provisions of the Act?
Subsection (5) here refers to a person who is a director and who fails to take all reasonable steps to secure compliance. It says nothing about his inability to be present. A director is not bound to be all the time within the district so that he may attend a meeting to determine the accounts. In the performance of his duly he may be sent to a Colony or to some distant country. He cannot be in the district all the time, and he is not bound to be there all the time. It may be that he is a director of the company because of some technical knowledge which he has with regard to some process or some engineering enterprise which is one of the businesses of the company. He may know nothing whatever about accounts, and he may be unable—although it may be that he is a man possessing considerable scientific knowledge—to be quite sure that the accounts completely comply with the provisions not only of this section but also of other parts of the principal Act and this Bill regarding the matters to be stated in the accounts.
Any difficulty in Which he may be, especially if he is a person who is not in any way accustomed to dealing with accounts and who knows nothing about them, is nearly always in practice satisfied in his mind by the fact that he thinks his brother directors—one or more of them—who are far better acquainted with the matter than he is himself, have looked
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at the accounts and think they are sufficient to satisfy the provisions of the various Acts of Parliament. Is that sufficient? I venture to think that if this clause stands it is not. He has to take all reasonable steps to secure compliance with the provisions regarding the accounts, although he may know no more about accounts than a child. It will be the worst possible thing in the interests of companies as a whole to have a provision ensuring that no honest man can be confident that he will escape a prosecution unless, in some way or another, he takes a long course in economics and the keeping of accounts. In nine cases out of ten directors rely upon what their auditor tells them or on what the other directors tell them, but this imposes a liability on directors of companies who have not the commercial experience which auditors have and who, as I have said, often know very little about accounts.
More particularly it involves the accounts of subsidiaries. With all the force at my command I ask the noble and learned Viscount to consider whether the present clause is not far too drastic, and whether something ought not to be put in to ensure that a man cannot be held liable to the disgrace of a prosecution for mere inadvertence or mere inability to make sure what has to go into the accounts. For my part, I have never yet been in a court of summary jurisdiction, and I hope to escape, but if I were entering into the dangerous enterprise of being the director of an important public company, I should be very much afraid that I should find myself before very long in such a court, accused of having failed to take all reasonable steps to secure compliance with all the multifarious provisions of these various Acts. On those grounds I beg to move.
Amendment moved—
Page 11, line 32, after ("company") insert ("willfully and knowingly").—(Viscount Maugham.)
LORD SIMONDS: May I say one word in support of the Amendment moved by the noble and learned Viscount? My question is quite a simple one. What do the words "fails to take" mean? If they only mean "does not take," pray let it be said. If, on the other hand, they mean "knowing that he ought to take but does not take," that is a very

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different thing. I cannot help thinking that the phrase "fails to take" is substituted for the simple words "does not take", because I find a point of distinction in the proviso. You will notice that the proviso to this clause says:
"Provided that a person shall not be sentenced to imprisonment for any such offence unless in the opinion of the court dealing with the case the offence was committed wilfully."
That certainly suggests to my mind that at any rate the intention of the clause is that ha may be sentenced to a fine not exceeding £200; that is to say, that he may be subjected to the ignominy of a prosecution and to the more serious loss which a fine will entail upon him, simply because he has not taken certain steps. That, as my noble and learned friend has said, runs contrary to the most sacred principles of our law, and I do, with him, protest most emphatically against the provision in this Bill which imposes upon inadvertence—and inadvertence in a matter of peculiar complication—the possibility of prosecution and fine.
THE LORD CHANCELLOR: I am a little surprised that from two such eminent masters of this topic of the law comes advice which is completely contrary to that which I have received from the Board of Trade. Having read the sections of the Companies Act, I am bound to say, with the greatest respect to the two noble Lords who have spoken, that I prefer the advice of the Board of Trade. These words "fails to take" are taken out of the Companies Act. They are the precise words in Section 122 and Section 123 of that Act. The position which the Companies Act takes up, and which we desire to take up here, is this: Suppose you have a man who has failed to take steps which this Act requires. If he has been Wilful and deliberate about this matter, then we say the penalties are either fine or imprisonment in such a case. It may be either. But we add that so long as he has not been wilful then it cannot be imprisonment. We desire to have that for this reason. It is not infrequent that people are repeatedly fined owing to negligence—they just cannot be bothered. It is not that they are wilful in filling up anything they should not do, or not filling up something which they should fill up; it is that they cannot be bothered. They are negligent and they are careless.
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If there is a case where this sort of thing goes on repeatedly, it is surely right and proper that the Board of Trade should have power to authorize a prosecution—I think it is the Board of Trade who do it—and to obtain a pecuniary penalty. I entirely agree that imprisonment is quite inappropriate where you have mere negligence, but where you have repeated negligence—and the Board of Trade do not desire to use this power except in cases of repeated negligence—we think it ought to be dealt with. I submit it is then right that the Board of Trade should have this power. Let us go for a moment to precedents. Let us look at Section 122 and Section 123 of the Act. Section 123 is the exact counterpart of this section, but may we come first to Section 122? Section. 122 is the section which provides that proper books of account of the company are to be kept. Subsection (3) says this:
"If any person being a director of a company fails to take all reasonable steps to secure compliance by the company with the requirements of this section"—
those are the precise words, and now we come to an alternative—
"or has by his own wilful act been the cause of any default by the company there under"—
those are the two cases—
"he shall, in respect of each offence, be liable on summary conviction to imprisonment … or to a fine. …
Provided that a person shall not be sentenced to imprisonment … unless the offence was committed wilfully."
It is quite plain, therefore, he may be sentenced to a fine, even although the offence was not committed wilfully.
Now we come to Section 123. It is a section which deals with the profit and loss account and balance sheet. Subsection (3) says:
"If any person being a director of a company fails to take all reasonable steps to comply with the provisions of this section, he shall, in respect of each offence, be liable on summary conviction to imprisonment … or to a fine …
Provided that a person shall not be sentenced to imprisonment for an offence under this section unless in the opinion of the court dealing with the case, the offence was committed wilfully."
There again, it is, with the greatest possible respect, as plain as a pikestaff that where you have this man guilty, but not guilty wilfully, he can be subjected to a fine. This is precisely what we desire in our clause. I had certainly intended to

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follow the precedent of the Act of 1929, and I gladly look to see whether I am not following the precedent of the Act of 1929. I believe that I am, and I desire to. I believe that the effect of the Act of 1929 is this: If the offence is committed wilfully then you are in peril so far as imprisonment is concerned. If the offence is not committed wilfully, then the most you risk is a fine.
But I give your Lordships the assurance that the Board of Trade are not going to be astute to pick out any possible failure to comply with one of the complicated provisions of this Act, and thereupon try to get a fine, because our magistrates are wise, and if they do any such foolish thing I am certain the fine would be the smallest coin in the realm. I do, however, give your Lordships the assurance that that is not the intention at all. We think it right and do desire to have the power to exact a fine in cases of repeated negligence—not wilfulness, but where a person has not bothered about a thing. In those circumstances we consider there ought to be a right to take the matter to the court. It is for the magistrate to decide what the measure of the fault is, and what the extent of the fine shall be. But we think there should be power, in that case, to exact a fine. In view of the fact that some of your Lordships, with great authority, have talked of something new and departing from precedent, I will gladly look at it again. But if, as at the present moment I am advised, and on my own reading of the Act, I am following the precise provisions of the 1929 Act, I should desire in this Bill to adhere to those provisions.
LORD BALFOUR OF INCHRYE: I wonder if I might be able to intervene in this legal argument. It seems to me there are certain aspects of the case put up by the noble and learned Viscount, Lord Maugham, which have not been answered from the point of view of the ordinary citizen who is perhaps exercising the function of a director and who does not want to be guilty of repeated negligence, but who, without any intent to be negligent, fails to take all reasonable steps. Let us take the case of the technical director about whom my noble friend Viscount Maugham spoke. This director is put on the board of the company, not because he has any particular holding in that company, but in order to give him
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the status and position of director in the exercise of his technical functions. Let us assume that he is sent to the Malay States, India, or elsewhere overseas, on duties concerned with his company, and that while he is away the board fail to take certain reasonable steps in accordance with this Act to fulfil the provisions of the Act. Is that director then liable to the stigma of prosecution because he is in fact bearing a share of responsibility—indirect, if you like—as regards the failure of the rest of his colleagues on the board to take reasonable steps? If that is so it seems to me that we are prejudicing the freedom of boards to co-opt people for specific technical purposes and, equally, men will be very hesitant to accept such positions.
THE LORD CHANCELLOR: This is criminal law: you do not hold a man guilty because of a vicarious principle; he is guilty only for what he has done.
VISCOUNT MAUGHAM: Pardon me, the point is whether he is guilty.
THE LORD CHANCELLOR: The noble and learned Viscount does not realize that I am speaking. If a director has gone abroad to Malaya, leaving competent directors behind, it will be absolutely impossible for a common-sense magistrate to hold that he is guilty of a breach of the provisions of the Act.
VISCOUNT MAUGHAM: I apologize to the noble and learned Viscount for intervening while he was speaking. I think he will agree—to pot the case perfectly correctly—that he was stating what the criminal law was in regard to something done by a man; but that is not the question here. The question is whether a man is liable for something he has not done. Therefore the example or the proposition which was advanced by my noble and learned friend was not, I think, apposite in the present case. Let me say this. Certain suggestions have been made as to the intentions of the Board of Trade. Let the intentions be embodied in the Bill. But what the intentions of the Board may be in ten, fifteen or fifty years hence the noble and learned Lord Chancellor knows no more than I do, and his views as to what the Board would then do are, I venture to think—unlike other statements of my noble and learned friend—not really statements which should have very great force in deciding the course which your Lordships should take in this case.

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I pass this aside unless and until an effort is made to say that these clauses will be applicable in actual cases of negligence by a director. That would be quite a different matter, but nothing of the sort is in the Bill. Indeed, the whole case of my noble and learned friend was given away when he said, in answer to the argument of my noble friend on my left, that it is true that this means simply that the director does not do something. He does not do something for he is in Malaya, and he is liable then to be prosecuted because he has been away; and I am not prepared to say that in those circumstances it is right to allow this clause of the Bill to pass. It is perfectly easy to put the matter right. We are told that no man in his senses would then prosecute the director. Well, it may be so; yet I know that there are a good many prosecutions which take place in the courts of summary jurisdiction which, according to the opinion of others and the courts before which the matter comes, no reasonable man ought to have brought. Nevertheless they are brought from time to time. I am greatly concerned that directors can be liable for mere inadvertence, even though we have the assurance of the noble and learned Viscount that the Board of Trade would very seldom interfere. My noble and learned friend relies on Section 121 of the principal Act which I endeavoured to read as clearly as I could. I must remind him that this is subject to Section 365 (2) and I should like him to tell me whether he agrees that Section 365 (2) of the principal Act will apply to the present Act when this Bill has come into force.
THE LORD CHANCELLOR: Of course it will apply to the present Bill. I read it that Section 365 deals with civil liability, and does not touch criminal liability.
VISCOUNT MAUGHAM: Surely my noble and learned friend is wrong. If he will look again he will see that it is a provision with regard to default fines and officers in default, and it says distinctly
"For the purposes of any enactment in this Act which provides that an officer of a company"—
which includes director—"
who is in default shall be liable to fine or penalty."
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That is not civil liability; it is criminal liability—liability to default fines, generally speaking, executed by a court. The subsection states:
"The expression officer in default means any director, manager, or secretary or other officer, who knowingly and wilfully authorizes or permits default, refusal or contravention, mentioned in the enactment."
What the precise intention of the draughtsman was in Section 122 when he penned that very curious phrase which I ventured to read, I do not quite know, but he did no harm, as I apprehend the case, because Section 365 has a distinct provision that officers of companies who are in default are not to be liable for fine or penalties unless they knowingly and wilfully have authorized and permitted default. Those, to my mind, are as clear as any words can be in an Act of Parliament in the present year of our Lord. They are absolutely clear. If they apply, and if I am satisfied that they apply, I am not so worried about the present Amendment. If they have nothing to do with the case, but relate only to some civil obligation, then I shall insist upon my point so far as I can, fortified, as I am, by the very distinguished support that I have obtained, and I shall propose to divide the House.
THE LORD CHANCELLOR: I should have thought that Section 365 was really a definition of the default and fine. Is it not Section 372 that the noble Viscount is thinking of? That gives him, I think, what he wants. Of course, Section 372 will be subject to this Bill; it will find its place in an Act of Parliament which will contain both Section 365 and Section 372. I am only making the suggestion. If the noble Viscount wants to divide the House, he can do so. I have already said that I will, with my advisers, look into this to see whether I am right or wrong. I believe I am right, I am advised that I am right and I think that I am right, but on a question of this sort I am willing to look into the matter between now and the Report stage. As at present advised, I am not prepared to give way on what seems to me to be a matter which goes to the root of this Bill. If it is going to mean that, however negligent anyone may be in failing to comply with the provisions of the Act, he is to be immune from all proceedings or penalties, we may as well cease going on with

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this Bill. We regard it as a matter of the first importance that a man who, by his negligence, fails to carry out the duties which this measure thrusts upon him should not be able to get away with it. We say he ought to be subject to the risk of going before a magistrate who will be able, even though it appears that an offence has not been committed wilfully, to consider the circumstances and to say to what extent a penalty is appropriate.
VISCOUNT ELIBANK: I wish to say a few words from the practical point of view rather than upon the legal aspect, which has been so ably put by my noble friend, Viscount Maugham. I have been a director of companies and a chairman of companies for many years, and I have had something to do with the constitution of boards. As has been pointed out this afternoon, boards consist of all kinds of people. They not only consist of the chairman—who may be merely a practical business man—but very often, and indeed usually, comprise technical experts, engineers, scientific men and so on. And, as a rule, there are one or two members who are particularly cognisant of accountancy and financial affairs. In all my experience, I have hardly ever known technical men, engineers or others, who claim any knowledge of accounts, qua accounts. According to this clause, as it is drafted, every director of a company will be in the position of having to know about accounts; otherwise if anything happens—whether inadvertently or otherwise—he may find himself in the dock. What is going to be the effect if this clause comes into force with its present phraseology? I can visualize that on every board, technical and scientific members or other members who are there for specific reasons will consider their positions with a view to deciding whether, in the light of this clause, they will remain in their positions on the board. It is quite likely that many boards, in the circumstances, will lose the services of very useful and eminent persons.
To carry this point still further, I would say that in the constitution of future boards this question will be coming up all the time. The Lord Chancellor shakes his head, but it is a fact. I speak from practical experience. I know that that is what will happen. I think it will be a great deterrent to the efficient constitution of boards in the future if
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this clause is passed in the way in which it is phrased today. I wholeheartedly support my noble friend, Viscount Maugham, in his Amendment. As it is phrased its wording may not be the exact wording that ought to be adopted. But something should certainly be put in the clause which will, at any rate, indicate to technical people, engineers, scientific men and the like, that they are not liable to prosecution because of something that may happen to the accounts of a company. If that is not done, I feel that this will be a very serious blot on the Bill. I hope that the noble and learned Viscount the Lord Chancellor will not remain so adamant as he appears to be at the present moment on this subject. If my noble friend, Viscount Maugham presses to a Division I shall gladly support him. I would rather not see this go to a Division, however. I hope that the noble and learned Viscount will consider the matter and see whether this part of the Bill cannot be put into more practical shape than it is to-day.
THE LORD CHANCELLOR: I have already said that I am prepared to consider this between now and the Report stage in order to see whether I have been following the precedent of the 1929 Act. I believe that the terrors which the noble Viscount has mentioned are there to-day. I have not a shadow of doubt that it would be absolutely foolish to say that a technical director, who leaves matters of accounts to a man far better qualified to understand them than he is himself, commits no offence at all. That is an absolute chimera. I think that the necessary provision is there to-day, and I want it to be there to-morrow.
VISCOUNT MAUGHAM: I am sure that everyone in the House is anxious to assist in making a reasonable amendment of the Companies Act, the principal Act, and we are therefore all in the same position as regards our wishes. At the moment I confess, and I say it without any heat at all, that I do not think the noble and learned Viscount who sits on the Woolsack is taking the right view as to the existing Act. Nor do I think that he is taking quite the right view as to the effect of this clause if it becomes law, having regard to the place where it is and the great by increased obligation that is put on companies with regard to their accounts.

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I know that 'there is a point on Section 122 of some weight. On the other hand, it is a curious thing, as regards the drafting of the principal Act, that Section 274, to which I have not previously referred, seems (as I think) to indicate that there has got to be some knowing act in not insisting upon the accounts being properly kept.
Your Lordships may remember that where a company is being wound up, the provision is that the director who was knowingly a party to or connived at the default of the company with regard to the proper books of account not being kept is to be liable unless he shows that He acted honestly. If something of that sort were inserted in the present clause 1 should be perfectly content. I am sure I have not the reputation of being unreasonable, and I am only desirous of making sure that honest men shall not be subject to the stigma of being attacked in cases where they really have acted honestly. It is not sufficient for me, I must confess, to be told that the Board of Trade will not take unreasonable action, because we have not the Board of Trade here and we do not know what they may do in the future. I think the Bill ought to be put right. The Act, when this Bill becomes an Act, ought not to justify something which is unreasonable. However, we have the promise of the noble Viscount to look into it, and I hope he will do so with a view to the possibility that my noble friends who have supported me really would not have supported me if I had had no grounds for the suggestions that I have made, and that it is possible that we are right. In these circumstances, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD MANCROFThad given notice that he would move, in the proviso to subsection (5), after "imprisonment" to insert "or fine." The noble Lord said: This Amendment is a consequential one, and in view of the debate that has just taken place I shall not move it. At the same time, associate myself as strongly as I can with the remarks made by my noble friend.
Clause 12, as amended, agreed to.
Clause 13:
Meaning of "holding company "and "subsidiary."
13.—(1) For the purposes of the principal Act and this Act, a company shall, subject to the provisions of subsection (3) of this section, be deemed to be a subsidiary of another if, but only if—
(b) the first mentioned company is a subsidiary of a third company which is that other's subsidiary, whether immediately or as itself falling within this paragraph.
(2) For the purposes of the foregoing subsection the composition of a company's board of directors shall be deemed to be controlled by another company if, but only if, in relation to the directorships or a majority of them, one or other of the following conditions is satisfied, that is to say—
(a) that a person's appointment thereto or continuance therein depends on that other company exercising in his favour or not exercising against him some power exercisable by that other company without the consent or concurrence of any other person, or can be made so to depend by the exercise of any right or power so exercisable; or
(3)In determining whether one company is a subsidiary of another—

(a) any shares held or power exercisable by that other in a fiduciary capacity shall be treated as not held or exercisable by it;

(b) subject to the following paragraph, any shares held or power exercisable—

(i) by any person as a nominee for that other (except where that other is concerned only in a fiduciary capacity); or

(ii) by, or by a nominee for, a subsidiary of that other, not being a subsidiary which is concerned only in a fiduciary capacity;

shall be treated as held or exercisable by that other;

(c) any shares held or power exercisable by any person by virtue of the provisions of any debentures of the first mentioned company or of a trust deed for securing any issue of such debentures shall be disregarded.

THE LORD CHANCELLOR: The next is a mere drafting Amendment. I beg to move.
Amendment moved—
Page 12, line 40, leave out "a third" and insert "any."—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR: This is also a drafting Amendment.
Amendment moved—
Page 12, line 41, leave out from "subsidiary" to the end of subsection (1).
On Question, Amendment agreed to.
5.15 p.m.
THE MARQUESS OF READING THE MARQUESS OF READING moved to leave out subsection (2). The noble Marquess said: In putting down the Amendment to leave out this subsection, I have two matters in mind. The first is that I do not think the most admiring supporter of the subsection would describe it as one of the most lucid which has found its place in this particular Bill. I am somewhat fortified in that view by the fact that I see there is an Amendment standing in the name of the noble and learned Viscount the Lord Chancellor which does seek to make some alteration in the rather obscure language at present used. The point is whether this particular subsection is necessary, or whether it is redundant. I do not want at this stage to press this except to get a view from the noble and learned Viscount on that aspect of it, in conjunction with his suggested change in the wording. There is also a proviso, and when I said that this particular clause was not amongst the most lucid I would rather put it the other way round as regards the proviso, and say that it seems to be amongst the least lucid wording in this particular Bill. In view of the fact that the noble and learned Viscount has an Amendment to this clause, it would, perhaps, be convenient to deal with the matter at one time, and at this stage I would merely move my Amendment.
Amendment moved—
Page 13, line 1, leave out subsection (2).—(The Marquess of Reading.)
THE LORD CHANCELLOR: I must say I agree with the noble Marquess who has just spoken as to the obscurity of this wording. It is very easy to criticise draftsmen, but I suppose if we ourselves sat down and tried to draft a Bill, everybody would be absolutely horrified at the obscurity. It may, therefore, be quite inevitable. However, I agree with the noble Marquess myself, having read it over several times. I have been at some pains to find out, and I think I know what the effect of the original clause is, and what the effect of my Amendment is. Your Lordships will see that in Clause 13, page 12, line 36, it says: "controls the composition of its board of directors." That is one of the tests of a subsidiary, and what we deal with next is to say what constitutes the right to control the appointment of a board of directors. The clause as originally drawn says this:
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Company A is to be treated as a subsidiary of company B if company B has the power to veto anybody being appointed to the directorship. You might, by a sufficiently extensive use of the power of veto, so far use that veto that there is only one person left. That, of course, is fanciful, but that is what the clause, as drawn, says.
The new Amendment which I intend to move is this. We said that company A is to be deemed a subsidiary of company B if, and only if, B has the power actually to secure appointment and if company B has the power to secure that Jones, Smith, or Robinson, shall be directors of the other company. If that is so, then we say that the other company must be deemed to be a subsidiary of the first company because the first company can control the position of its board of directors. That is what it is all about, but I will look at it once more and look at my Amendment once more, and see if we can, even now, do something to make the language a little clearer, not only in the interest of myself but also in the interests of the noble Marquess who moved this Amendment and all those unfortunate people who hereafter want to know what it is all about.
THE MARQUESS OF READING: I am very much obliged to the noble and learned Viscount, and I fully appreciate the difficulty of drafting a Bill of this kind. Of course, the difficulty is very great, but it does seem to me that by calling attention to it I have produced from the Government what is a more intelligible meaning. After all, as the noble and learned Viscount himself has said, the point is not that we should rely on a legal or verbal discussion across this House. The persons who have to interpret and operate this Bill after it has become an Act should have the plainest possible indication of what the responsibilities imposed upon them are. I am glad at least that the noble and learned Viscount has, by his speech, saved me from any sense of shame at not having understood what it meant in its original form. In those circumstances, I beg to withdraw my Amendment.
Amendment, by leave, withdrawn.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved in Subsection (2) to leave out from the second "if" to "or" in line 12, and insert:

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"that other company by the exercise of some power exercisable by it without the consent or concurrence of any other person can appoint or remove the holders of all or a majority of the directorships, but for the purposes of this provision that other company shall be deemed to have power to appoint to a directorship with respect to which any of the following conditions is satisfied, that is to say—
(a). that a person cannot be appointed "thereto without the exercise in his favour by the company of such a power as aforesaid;")
The noble and learned Viscount said: I have already indicated in the discussion on the last Amendment what the effect of this Amendment is, and I beg to move this Amendment in place of the words that appear on the Bill.
Amendment moved—
Page 13, line 3, leave out from the second "if" to "or" in line 12, and insert the said new words.—(The Lord Chancellor.)
On Question, Amendment agreed to.
LORD RENNELL LORD RENNELL moved, at the end of subsection (3) to insert the following new paragraph:
"(d) Any shares held or power exercisable by a company the ordinary business of which includes the lending of money ' as security only shall be disregarded."
The noble Lord said: This is an Amendment which I hope the noble and learned Viscount will see fit to accept. It is to exclude, in determining whether one company is a subsidiary of another, any shares held, for instance, by a Bank, or, as put in the Amendment "by a company the ordinary business of which includes the lending of money.
Amendment moved—
Page 13, line 39, at end, insert the said new paragraph.—(Lord Rennell.)
LORD BALFOUR OF BURLEIGH: I would like to support my noble friend in his Amendment. I am not sure if the noble and learned Viscount is going to accept it. I am advised that another way of doing this would be to exclude subsection 2 of Section 127 from the repeal mentioned in the Schedule which proposes to repeal Section 127 of the principal Act. If the noble and learned Viscount is going to accept the Amendment, that satisfies me.
THE LORD CHANCELLOR: I am going to accept this Amendment in principle; that is to say, I am going to put down an Amendment on the Report
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stage to deal with this. I am not quite sure of the form in which to do it. If the noble Lord will withdraw his Amendment now, I will undertake to put down an Amendment—it may be in this form for all I know; but I want a little time to consider what is the right form. In principle, however, I agree. I would ask the noble Lord not to press his Amendment now on the understanding that I will put down suitable words on the Report stage.
LORD RENNELL: I am much obliged to the Lord Chancellor and I have much pleasure in withdrawing the Amendment.
Amendment, by leave, withdrawn.
Clause 13, as amended, agreed to.
Clause 14:
Signature and copies of accounts.
14.—(1) The profit and loss account and consolidated accounts laid before a company in general meeting shall be annexed to the balance sheet and signed on behalf of the board by the directors or director signing the balance sheet.
(2) If—

(a) any copy of a profit and loss account or consolidated accounts not signed as required by this section is issued, circulated or published; or

(b) if any copy of a balance sheet is issued, circulated, or published without having a copy annexed thereto of the profit and loss account or any consolidated accounts required by this section to be so attached;

the company, and every officer of the company who is in default shall be liable to a fine not exceeding fifty pounds.
(3) Any member of a company, whether he is or is not entitled to receive notices of general meetings of the company, shall be entitled under paragraph (a) of subsection (1) of section one hundred and thirty of the principal Act to have sent to him a copy of every balance sheet and of the other documents mentioned in that paragraph, and any holder of debentures of a company shall have the same right under that paragraph as a member of the company:
Provided that this subsection shall not require a copy of those documents to be sent to any person of whose address the company is not aware.
(5) Subsection (1), and not subsection (2), of the said section one hundred and thirty shall apply in the case of a private company, as of any other company, except in relation to balance sheets laid before the company before the coming into force of this section.
LORD CHORLEY LORD CHORLEY moved, at the end of subsection (1), to insert:

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"Provided that the signing of the balance sheet shall for the purposes of this section be treated as the signing also of the profit and loss account and any consolidated accounts, if appropriate words are appended to the signature on the balance sheet to indicate an intention that it shall be so treated."
The noble Lord said: The object of this Amendment is to secure that the directors will have to append their signature only once to one of these accounts. As it stands, they would have to append their signature separately to the profit and loss account, to the consolidated accounts and to the balance sheet. Of course, if they are in different places that might be quite an onerous procedure. The object of the Amendment is to secure that, provided signatures are attached in the proper way, one signature will be sufficient. I beg to move.
Amendment moved—
Page 14, line 10, at end insert the said proviso.—(Lord Chorley.)
On Question, Amendment agreed to.
LORD CHORLEY: The next Amendment is merely consequential on the last.
Amendment moved—
Page 14, line 13, after ("signed") insert ("or treated as signed").—(Lord Chorley.)
On Question, Amendment agreed to.
LORD CHORLEY: The next Amendment is a small drafting Amendment. The two words "annexed" and "attached" mean the same thing, and the draftsman wishes that the same words should be used in both connotations. As it stands, it might be open to some advocate to suggest that, as "annexed" was used in one case and "attached" in another, the draftsman must have meant to use them with different meanings. That is not so, and in order to make that quite clear, this Amendment is moved.
Amendment moved—
Page 14, line 18, leave out ("attached") and insert ("annexed").—(Lord Chorley.)
On Question, Amendment agreed to.
LORD CHORLEY LORD CHORLEY moved, at the end of subsection (3), to insert: "or to more than one of the joint holders of any shares or debentures." The noble and learned Lord said: This Amendment is designed to secure that the requirement that accounts shall be sent to all members of the company will not have the effect of requiring the company to send copies to
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each joint shareholder where shares are held in the name of more than one person. At present, the usual practice, as I understand it, is to send them to the shareholder whose name appears first. Where there are joint shareholders, it would obviously be very inconvenient that they should have to be sent to each one. Often in these cases there are several of them. The inconvenience of this course has been represented to the Board of Trade by the Chartered Institute of Secretaries, and we are anxious to meet the point, which I am sure your Lordships will think is a fairly reasonable one.
Amendment moved—
Page 14, line 31, at end insert ("or to more than one of the joint holders of any shares or debentures").—(Lord Chorley.)
LORD HAWKE: This is an Amendment which is highly convenient to the companies and for the saving of paper, but I do not think it is quite fair to the shareholders. Under it, in a trust, only one trustee, so far as I can see, would be entitled to receive the accounts of the company in which the trust held shares, unless any of the other trustees made a specific approach to the company, presumably annually, to ask for those accounts. I would suggest that some machinery might be devised whereby the normal thing on registration of shares in more than one name would be that the first-named received the accounts, but that the others, at the time of registration, should be asked whether they wished to receive those accounts annually or not. In the case of existing registrations, I think that those shareholders who receive the accounts at the moment should continue to do so unless the company circularize them and suggest that they should not. I do not think the position as regards the one who does not receive the accounts is quite as the noble Lord says. I know in some cases they are certainly circularized to more than the first named. Perhaps the noble Lord will look into the question and see whether something can be done at the next stage.
LORD CHORLEY: I am much obliged to the noble Lord for his suggestion, and I am very glad to give the assurance for which he asks.
On Question, Amendment agreed to.
House resumed.

MALTA (RECONSTRUCTION) BILL.
5.28 p.m.
Order of the Day for the Second Reading read.
THE FIRST LORD OF THE ADMIRALTY (VISCOUNT HALL): My Lords, there will be no dispute on either side of your Lordships' House as to the great debt which we owe to the people of Malta, and to those of our countrymen who joined with them in the heroic defence of that gallant and war-battered island. The courage and endurance with which they sustained the bitter and heavy attacks of the enemy will always be remembered, and it is the desire of the people of this country that we should do our utmost to restore the damage which has been done, and to contribute, to the limit of our own resources, to raise the social standard of the people of Malta. Your Lordships will be aware that in accordance with the promise made by His Majesty's Government in 1943 steps are now being taken to restore to the people of Malta responsible government within the same sphere which they enjoyed in the years from 1931 to 1933.
In the recent White Paper the Government set out their proposals regarding the form that the new Constitution will take, and it is hoped that speedy progress will now be made towards the establishment of this Constitution. The Bill which is now before your Lordships has a twofold purpose. Its object is, first, to honour a pledge given to Malta in 1942 in regard to the grant of assistance from the British Exchequer for the making good of war damage; secondly, to afford a further measure of assistance to the Malta Government to enable the people of the island to undertake the responsibility of their internal affairs, in the full expectation that the working of the new Constitution will not be unduly hampered by financial and economic burdens thrown on the island by the war. Perhaps I may deal with those two aspects of the Bill separately.
Your Lordships will remember that in November, 1942, at a time when the enemy attack on Malta was still at its height, Parliament was asked to make a gift of £10,000,000 to be used for the purposes of restoration of war damage and the rebuilding of Malta after the war. At the same time the assurance was given that:
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"If the total liability of the Malta Government for compensation and rebuilding, after allowing for contributions from private owners, exceeds the sum of £10,000,000, His Majesty's Government will be prepared to make available such further sums as may be required to meet liabilities which are found in the circumstances as existing after the war to be beyond the capacity of the Government of Malta to meet from its own resources, having regard to all other calls upon those resources at that time."
I understand that the contribution from private owners is negligible in proportion to the extent of the damage done. The grant made in 1942 was based on the best estimate that could be made in the circumstances then existing. It is now clear that the original estimate is likely to be substantially exceeded. Sir Wilfrid Woods, who was appointed in 1945 to undertake a preliminary investigation into the finances of the Malta Government, estimated in the recommendations which he submitted that a sum of probably £42,400,000 would be required if the anticipated budget deficits in Malta during the next year or so were to be covered, and if the activities connected with water supply, sewers, educational development, health development, town improvement, social services and general reconstruction work were to proceed, and war damage compensation were also to be paid. He added that he thought that £42,000,000 was a sum in excess of anything which His Majesty's Government could reasonably be asked to meet. His figure of £42,000,000 was made up of £10,000,000 for reconstruction, £28,000,000 for war damage, £3,057,000 for social welfare and development, and £580,000 to cover budget deficits.
He also pointed out that it would naturally not be possible to make a precise and final estimate of war damage for many years to come. The total for war damage may well be less than the £28,000,000 of his estimate. It was clear from Sir Wilfrid Woods report that this expenditure would be beyond the capacity of the Malta Government to meet unaided from its own resources, and His Majesty's Government, despite the great difficulty confronting them in financing their overseas expenditure, decided, in accordance with their pledge, that it would be necessary to make available the further measure of assistance foreshadowed in the statement of November, 1942, which I have quoted.
The Government gave much thought to the form that such assistance should take.

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It could be given either in the form of a series of additional payments agreed from time to time, as expenditure proved in the future to be necessary, or in the form of agreement now on a definite sum of money to be drawn upon as necessary in accordance with the progress of expenditure. The first method of procedure would, in the Government's view, lead to many difficulties of administration and possibilities of friction between themselves and the Government of Malta, since differences of opinion would be bound to arise as regards the eligibility of particular expenditure, the ability of the Government of Malta to make some contribution towards such expenditure from their own resources and the efficiency and economy of the arrangements for carrying out the works involved. His Majesty's Government would, under such a procedure, need to have powers of control over administration in Malta which would be hard to reconcile with the new status. They therefore reached the conclusion that it would be more satisfactory to fix a definite and total sum at this stage.
The Government considered that the sum to be fixed in this way should leave some margin for reconstruction work not strictly covered by the definition of making good war damage and, after considering the estimates in Sir Wilfrid Woods' very competent report, they decided to seek the approval of Parliament for the provision from United Kingdom funds of a further sum of £20,000,000, making with the earlier grant a total of £30,000,000 in all. They decided that this sum should not be paid into a trust fund, as was done in the case of the earlier grant, but should be constituted by law a charge upon the Consolidated Fund. Payments to the Malta Government will be made annually against reasonable anticipations of expenditure as soon as the earlier grant is exhausted. The new grant, together with the £10,000,000 already granted and the interest received or expected to be received in the future on the earlier grant, will result in there being available for expenditure a total sum of over £31,000,000. The Bill, the Second Reading of which I am moving, provides that the Malta Government shall submit annually audited accounts showing that the funds issued under this legislation have been expended on the purposes for which the grant was voted. This does not mean Treasury control.
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His Majesty's Government did not, however, feel that the financial assistance to be granted to Malta should be limited to the purposes falling within the scope of the above grant. They recognize that the local government is faced with important and pressing demands for public work and the development of social services. While they were not able to accept the proposals made by Sir Wilfrid Woods in their entirety—and indeed Sir Wilfrid himself made it clear that he did not expect the Government to incur commitments to the full extent of his recommendations—still they were anxious to make some contribution towards Malta's needs for social services. It was therefore decided that as an exceptional measure the opportunity of this legislation should be taken to amend the Colonial Development and Welfare Act, to enable Malta to continue to benefit under its provisions, even after the introduction of responsible government.
In the absence of such amending legislation, the Colony would be debarred under the terms of the 1940 Act from so benefiting once the new Constitution had been introduced. Subject to acceptance by Parliament of this amendment, my right honourable friend the Secretary of State for the Colonies proposes to allocate to Malta a sum of £1,000,000, which would be available for grants for suitable schemes of welfare and development. In addition to the £1,000,000 referred to, Malta will, of course, enjoy a number of central services which are provided in London—services such as the training of the Civil Service for Malta, the provision of assistance in respect of higher educational development, and surveys and research schemes which are often necessary in Colonial areas. All of these will be made available to Malta as a result of her participating in the Colonial development arrangements under the Act. Malta will also be eligible for consideration with other Colonies for supplementary allocations from the remaining unallocated reserves, and will similarly be entitled to share in any further provisions which may be made by Parliament on the expiry of the present Colonial Development and Welfare Act in 1956.
So much for the objects of the present Bill. I should, perhaps, mention that in addition to the assistance offered to the Colony under this Bill the Government

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have announced that they will be prepared, if necessary, to make some provision by way of grants-in-aid to meet the costs of administration during the financial year 1947–48, in accordance with Sir Wilfrid Wood's recommendation. They also recognize that the complete cessation of commodity subsidies at the end of the current financial year, as recommended by Sir Wilfrid Woods, might in the circumstances impose an undue burden on the Government and people of Malta. The Government are therefore prepared to meet one-half of whatever provision for such subsidies in the Malta Estimates for 1947–48 is agreed to be necessary, subject to a maximum contribution of £450,000.
As a result of this Bill, with the grants already made the total amount for which it is proposed that His Majesty's Government shall be responsible—for war damage, reconstruction, and other services will be of the order of the £20,000,000 provided under this Bill, £10,000,000 already granted, and a further £1,000,000 interest accumulation on the £10,000,000. To this sum of £31,000,000 must be added an allocation of £1,000,000 from the Colonial Development and Welfare Act. In addition, there will probably be a deficit of £580,000 in regard to the budget for 1946–47 and 1947–48, which will involve a grant-in-aid of a similar amount. Further, there is a commodity subsidy for next year which will probably amount to the figure of £450,000. All of these sums must be taken into account when the degree of assistance which the Government are now offering to Malta is calculated. And it must not be forgotten that some £6,000,000 grants in aid of administration have been paid to Malta since 1941. In addition, there have been large food and other subsidies. Although the provision which the Government makes falls short by £9,000,000 of Sir Wilfrid Woods' estimate, I would point out to your Lordships that this expenditure of £33,000,000 will probably be spaced over a period of fifteen or more years. It will now be the responsibility of the Malta Government to plan their own social programme in the light of the assistance we can give to the island.
His Majesty's Government are confident that these measures can be regarded, not only as honouring in full the
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pledge made by the Government in 1942 but also as affording the people of Malta an assurance that responsible government will not be unduly hampered by financial difficulties. For their part, the British Government can expect the Malta Government to plan their reconstruction programme and their policy of economic and social development in a manner calculated to ensure the most effective and economical use of the resources now made available to them, and to review their system of taxation in order that the fullest contribution from their own resources may be made towards these objects.
Your Lordships, I trust, will agree that considering our own financial difficulties a contribution of some £33,000,000 is not ungenerous, and I ask your Lordships to give the Bill which is now before your House a unanimous Second Reading.
Moved, That the Bill be now read 2a.—(Viscount Hall.)
5.48 p.m.
LORD TWEEDSMUIR: My Lords, I will not detain you for more than five minutes because I know that several other noble Lords wish to speak. The points which I wish to make can be put very briefly. I warmly echo the tribute which the noble Viscount, Lord Hall, has paid to the people of Malta. There have been times in this recent war, and in a previous war, when the fate of Britain and her Allies seemed to depend on the fortunes of this little island.
Malta has been in our charge for nearly 150 years, and came into the British Empire at her own request. Our relations with Malta provide an example of the inter-dependence of the countries of the Empire, for if Britain and her Allies depend on Malta in time of war, Malta is entirely dependent, economically and financially, on Britain, in both war and peace.
I am voicing opposition to two principles which are contained in Clause 1 of this Bill, but before making my case I would like to draw attention to Clause 3. A part of the sum voted to Malta is being offered under the Colonial Development and Welfare Act. With the imminence of responsible government, Malta would normally be ineligible for this grant. I am delighted that she is to receive it. Because a Colony is to receive

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self-government is no reason why it should be debarred from financial benefit.
In 1942, as the noble Viscount, Lord Hall, has pointed out, the Parliament of this country voted £10,000,000 to make good the war damage in Malta, and added the pledge that Whatever further expenditure the Government of Malta might be put to under this head Which it was beyond bier own resources to produce would be made good.
You cannot make a final settlement of a debt until you know exactly how much you owe. To that end Sir Wilfrid Woods went to Malta, made his survey and made his report, reaching various conclusions. He produced certain figures which he himself said were "highly speculative." If a Commission went to Malta this year, next year or the year after, their conclusions would still be highly speculative. The noble Viscount has said that it will take some fifteen years to repair the ravages of war, and it will only be some time near the end of that period that our total indebtedness will be known. Yet we are to understand that although our total indebtedness is a figure that none of us can tell now, this is to be a final settlement.
The noble Viscount outlined very clearly the different courses open to the Government in implementing their pledge. I took the liberty of thinking that His Majesty's Government chose, from the courses outlined, an absolutely wrong one which, whatever its merits, does not in fact honour that pledge. For that reason I consider this Bill to be a bad document. I consider it bad for that reason and for this further reason. Under Clause 1 one of the objects given of this grant is the reconstruction of Malta, in the sense of planning. To my mind that is a clear cut case of a composite sum. If the people of Malta, taking a much larger share than heretofore in the affairs of their own Government, have a composite sum, they will know exactly where they stand. They will know exactly what the scope of their planning can be, because they will know what they have to plan with.
Sir Wilfrid Woods in his report used these words:
"A full and final settlement of the question of financial aid from the United Kingdom to Malta, by payment of a single sum to the
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Malta Treasury, or, to Trustees, would have obvious advantages, but it is not a practical proposition."
I entirely agree—I do not believe it is a practical proposition. This Bill lumps all these issues together into one, and it leads to the rather dreary conclusion that the Government of Malta will find themselves with three choices. The first is to go all out in repairing the Near damage and, because they do not know what it will finally cost, keeping the residue of that sum up their sleeves in case they should eventually need it, in which case the planning would suffer. Secondly, they can go ahead with a fairly, ambitious planning scheme, but always taking a risk that the rubble of over four thousand air raids may continue to lie where it lies now. Thirdly, they can make a half-hearted attempt to do both, and do neither adequately. It is not surprising to me that our integrity has been called into question by the people of Malta. It will be distressing but not surprising if this transaction is regarded as the touchstone of our sincerity in this present day, and then our integrity may become a matter of doubt to countries far beyond Malta, both within the Empire and without it.
5.55 p.m.
LORD STRABOLGI: My Lords, before I make a few comments in answer to the noble Lord opposite, I would like to point out a peculiarity about this Bill. The copy I have in my hand is as the Bill was introduced into another place, and it has a page of explanatory memorandum upon it. The Bill in your Lordships' hands has not the explanatory memorandum. I do not know whether that is a compliment to your Lordships' House or not, but I personally would have been glad of the explanatory memorandum if I had not had the House of Commons copy, and I feel sure that the noble Lord, Lord Tweedsmuir, might have modified some of his rather strong words—
LORD TWEEDSMUIR: I had the honour of pointing out to the noble Lord that this other Bill existed which contained this memorandum, so I think he can assume I have read it.
LORD STRABOLGI: That is just a matter I wanted to point out to your Lordships, and I would suggest it would be better on the whole if we also had explanatory memoranda in future Bills. We have heard some very strong language

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from the noble Lord. He talks of integrity, broken pledges, questions of our sincerity and so on. I read every word of the proceedings in another place, I listened with very great care to the most able speech of my noble friend below me, and I read the Bill. Really, for the life of me I cannot see where broken pledges, the lack of sincerity or integrity come in. If this money is found insufficient for the purposes for which Parliament has provided it, it is open to this Government or any future Government to provide further sums. I cannot see where the finality comes in at all.
Clause 3, with which the noble Lord, Lord Tweedsmuir, agrees, allows the Colonial Development Fund to be drawn on in the future for just this sort of purpose. I cannot see where the temptation lies for the Government of Malta to skimp the work, as was suggested by the noble Lord. All sorts of things' are said in another place; but I think it is unfortunate that in your Lordships' House, where we are supposed to be so dignified, careful of our language, and so well-behaved, such strong language should be used which will be seized upon by the small minority of Fascists in Malta to stir up trouble for us in that hard-pressed Island.
The only part of the noble Lord's speech with which I agreed was when he reechoed the praise of the people of Malta in their hour of trial so eloquently expressed by the noble Viscount, Lord Hall. The explanatory memorandum talks of the "Siege of Malta." It was not a siege in the accepted sense of the term, in that the enemy never had the courage to attempt a landing on the island. They employed every sort of devilment with the least possible risk of themselves, by blockade and by their continuous and promiscuous air-raids. We used to prepare our convoys to Malta consisting of six specially picked ships (Reconstruction) with specially picked crews. Each of those ships was loaded with the same cargo—so much', petrol, so much ammunition, so much medicine and so much food—in the hope that one would get through. One or two did get through. That is what saved the Island, and the spirit of the people was never broken, as both of the noble Lords who have spoken have remarked.
As the noble Lord, Lord Tweedsmuir, said, Malta is in the unique position of
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being the one territory of the British Empire which voluntarily invited the Crown to accept its allegiance. The others were annexed, conquered or colonized, but this is the one case of people of European stock who voluntarily came in with us. We therefore have a special responsibility for them. I am glad that this Bill has been introduced by my noble friend. He is not only the ex-Colonial Secretary, but he is the present First Lord of the Admiralty. Speaking as one who used to know Malta very well in happier days, I must say that the Navy owes a great debt to Malta both to its hospitable and industrious people, and because of its great strategical importance. I understand that the Navy have returned to Malta, and I hope full use will be made of it and its dockyard resources.
There is a grave problem of over population, and it has existed now in Malta for centuries. The natural resources are meagre; the people are prolific, and the population is too great. Emigration is one attempt to deal with it. It is difficult for the people of Malta to emigrate at the present time. I wonder, for example, if inviting the Maltese to come to this country to help us out in our agriculture and our building has been considered. The Maltese are excellent farmers; they are amongst the finest id the world. What they have done with the limited soil they have is miraculous. They are very hard working and sober. They are good husbands and would send the greater part of their wages home to Malta and thus help the economy of the Island. They are also excellent builders. No one who knows the wonderful buildings of Malta would require me to justify that. The last time I was in Mousta I was glad to see standing the second greatest dome in the world after St. Peters in Rome, a building which was erected by the poor villagers of Mousta and took a hundred years to build. That sort of people would, I believe, be extremely valuable at the present time to help us over our problems in this country. They are British subjects and would be very helpful. Moreover we could rely on them to remit the greater part of their earnings to their families in Malta.
I must make one further remark which has no direct bearing on the Bill but has on Malta. Many of your Lordships will know that there have been few debates on Malta in this House since the lamented death of Lord Strickland. He

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had a Maltese mother and he served your Lordships' House with distinction. Against all sorts of coldness, obstruction and indifference from the Government, he used to rise from the Red Benches of the House and present a case for Malta, and urge the need for strengthening the defences of the Island for the war that would come. He was not listened to, but how right he was! When the war came we particularly needed those defences which Lord Strickland had always advocated in this House. I cannot let this occasion pass without paying a tribute to his far-sightedness and his statesmanship. He helped some of the great services of Malta and formed Malta's Labour Party. I think it right to pay that tribute to him. I am sorry there has been this opposition from the other side of the House. I believe the Bill is generous and it has the necessary safeguards. I believe it will be generous and it has the necessary safeguards. I believe it will be accepted by the inhabitants of Malta and will be one more link with this great people.
6.3 p.m.
LORD LLOYD: My Lords, I do not think it necessary for me to embroider the eloquent tributes made by the noble Viscount who opened the debate, or by the noble Lord, Lord Tweedsmuir, and the noble Lord who just sat down, as to our feelings towards the people of Malta and the great part they have played in recent years. I am sure any tributes they paid expressed the feelings of us all. I wish to do no more, therefore, than to associate myself most warmly with those expressions. We feel we are here to-night to endeavour to show our gratitude in some concrete form to the people of Malta. But when I come to examine this Bill I very much regret to say that I cannot find it in my heart to support it as it stands. It seems to me that the main weakness of the Bill is that this is a Bill framed to deal with two different cases in respect of which this country and His Majesty's Government have entirely different commitments. It is framed to deal with war damage, on which there is a pledge which the noble Viscount explained at some detail in his speech, and in the second place it is framed to deal with planning and reconstruction, which is an entirely different matter and one in which we have no such obligations. That is the first fault of the Bill.
The second fault is that this Bill is in the nature of a final settlement, and on
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this question of finality I should like to say a word in connexion with the remarks of the noble Lord, Lord Strabolgi. It seems to me to be plain that it is quite open for any other Government to add to the money we are proposing to give to Malta under this Bill. Why then make mention that this is a final settlement? What is the object of it, if another Government is later going to add to the money? I would much rather, so far as war damage is concerned, see no final settlement. I think His Majesty's Government were extremely unwise to make such a settlement, which has aroused the worst kind of disappointment in Malta.
I would like to deal briefly with the question of war damage. The noble Viscount gave us the figure of £28,000,000, which Sir Wilfrid Woods estimated would be the cost of war damage. I should like to join with Lord Tweedsmuir in saying that it is quite obvious that at the present stage we cannot estimate what is going to be the cost. There are various factors which will affect it, one of which is where the materials are going to come from. Obviously it would make a very considerable difference to the situation if Malta had to buy all her materials abroad in foreign currency, with a depreciated pound sterling. Sir Wilfrid Woods made his estimate in 1945 when he was presumably calculating on the basis that materials were coming from this country. With the present housing situation I cannot conceive how for many years we are going to be able to send much building material to Malta. That seems to me to be the issue which affects the matter of war damage.
The next question is Malta's capacity to pay. That is a point we want to know. All I can do is to take the only evidence available to your Lordships, which is the report of Sir Wilfrid Woods. In this report he estimates that if Malta's budget is cut to the minimum, and if direct taxation and additional customs dues are imposed, Malta's budget will just about balance. He may be wrong or he may be right: we cannot tell at the present time. That is his estimate. Malta is an extremely small island with only one-eighth of its income derived from natural resources and the bulk of its revenue coming from services rendered to the Royal Navy and the Forces. If, as is likely, the amount that is obtained from these services is reduced, it may well be that Sir Wilfrid

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Woods' estimated revenue may be reduced. So much for war damage aspects of the matter. In view of those points, I do feel that the matter should have been left over until we could really see how we stood under our pledge.
With regard to reconstruction, I agree with the noble Lord, Lord Tweedsmuir, that this is a matter which is upon an entirely different footing. So far as reconstruction is concerned, we are planning for the improvement of Malta. Therefore, I think it would be perfectly proper for His Majesty's Government to decide what the British taxpayer can afford to give, and to make a final settlement. One point I would like to make on that matter is that Sir Wilfrid Woods, in his estimates regarding reconstruction, mentioned large sums which would have to be spent on sewerage and water in Malta. He brought out, very plainly, that these were facilities which were not only important to the Maltese but also to our own Forces stationed at Malta. Therefore, in making these payments for reconstruction, we benefit not only the Maltese but ourselves. I should have hoped that His Majesty's Government would have been as generous as possible had they been going to make payment of a fixed sum, but that has not been done. The course which I should have liked to see taken would have been, first, for the contributions under two heads to have been kept separate, second, for the contribution in respect of reconstruction to have been a fixed and final sum, and, third, for the contribution towards the repair of war damage not to have been final but in the form of another instalment similar to the instalment of 1942. As it is, undoubtedly, the impression has been given to the Maltese people that while His Majesty's Government may seem to be generously providing for war damage and for reconstruction, on closer examination the sum provided is inadequate for both. They feel, I think, that in some way, they have been "done down" by His Majesty's Government.
Lord Strabolgi has referred to the words of my noble friend Lord Tweedsmuir. I think he deprecated the language which Lord Tweedsmuir used, and suggested that by what he said he might be raising feelings in Malta that would otherwise lie dormant. I should like to refer the noble Lord to a letter in The Bulletin of Monday, January 27, written by Dr. Paul
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Boffa, Leader of the Maltese Labour Party. Dr. Boffa wrote:
"The decision arrived at by the British Cabinet that the total grant to Malta of 31,000,000 to make good the havoc wrought by the war is to be considered as final, is most unjust, unfair, and illogical."
Further on the letter contains this passage:
"No wonder, therefore, that friends and believers in a 'British Brotherhood of Nations' are fast losing faith in the proverbial British justice and fair play; no wonder that the Egyptians and Indians are after complete and absolute independence, Cypriots for annexation to Greece, and no wonder, therefore, that the proverbial Maltese loyalty is undergoing a process of rapid evaporation under the disillusion and frustration."
I suggest to the noble Lord that those feleings to which he referred already exist in Malta. The writer of that letter, after all, is the Leader of the Maltese Labour Party. But whether what Dr. Boffa wrote is correct or not, I regret infinitely that such an impression could have been aroused by His Majesty's Government. The fact that such an impression can be aroused adds point to what Lord Strabolgi said, and tends to foster such anti-British feeling as already exists in Malta. It tends, moreover, to loosen those ties on which the British Empire is built. I regret to say that I feel there is some justification for these feelings, and I consider that, possibly inadvertently but nevertheless definitely, His Majesty's Government have in effect, broken the pledge that was given in 1942 to the Maltese people.
6.15 p.m.
VISCOUNT CRANBORNE: My Lords, I rise only to speak very briefly. No one in this House, as I think the First Lord of the Admiralty said in his opening speech, will wish to criticize, still less to oppose, the main purpose of this Bill, which is to make reparation to the people of Malta for the cruel losses which they have suffered as a result of their unflagging devotion to the Allied cause. The story of the defence of the Island will, I suppose, go down in history as one of the great epics of this or any other war. It might have been anticipated, I think quite fairly, by any military expert, that that little Island, in the very middle of the Mediterranean, far from any Allied territory and close to the Italian bases, would have been the first of the Allied bastions to fall. But through four years

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—more than four years—of uninterrupted attack by sea, land and air, the people of Malta surmounted the worst that the enemy could do against them, and never to the end were they overcome. That is a magnificent record.
It was my privilege—a privilege which I expect others of your Lordships enjoyed also—to visit Malta during the siege. That was in August, 1942. The worst of the bombing was then over, but in many ways I think that the people of the Island were undergoing the most severe of their trials. Food was short, and there was no immediate prospect of getting any more. Their ancient and beautiful buildings had been battered into rubble, their harbour was filled with rusty and rotting shipping, and the Allied Forces in North Africa (this was before the Battle of El Alamein) were still being steadily rolled towards the east. Indeed, a thousand miles separated the Island from the nearest Allied Forces. Yet at that time—and the Earl of Munster, who was there much longer than I will tell you the same thing—the brave Maltese people never wavered in their faith. Their loyalty to the King never flagged. It was a most moving and unforgettable experience to see their calm, unruffled fortitude. Never was the George Cross more worthily bestowed than upon the Island of Malta.
Now, as the First Lord of the Admiralty said in his speech, the time for reparation has come, and the only question with regard to this Bill, as I see it, is not whether too much is being allotted to the people of Malta but whether too little is being allotted. That has been the burden of some of the speeches that we have heard this afternoon from the Benches behind me. It is a point which has already been thoroughly threshed out in another place, and though, like other noble Lords who have spoken, I do not feel, myself, that the declaration of the Secretary of State for the Colonies in another place was sufficiently elastic to meet the position, I do not propose, personally, to reopen the question here to-day. As your Lordships know, the powers of this House are, in any case, severely limited where matters of finance are concerned. But I feel that, perhaps, in view of what has been said this evening, there is one comment that I ought to make. While it is true that I, as Secretary of State for the Colonies, in 1942 gave an assurance that if the original £10,000,000 was not adequate to provide
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for the repair of war damage, His Majesty's Government would make available such further sums as were required to meet such liabilities as were beyond the capacity of Malta to meet from her own resources, it was clear from my answer at that time—if your Lordships will trouble to look it up—that it was then anticipated that £10,000,000 might well be enough for that purpose. I will quote my own words:
"If the actual expenditure under these heads falls short of the total vote of £10,000,000, the balance will be applied to other purposes beneficial to Malta after the war."
It is, I think, therefore clear that at that time £10,000,000 was regarded as likely to be a fair compensation for the damage that had been done. In the circumstances, and with all deference to other noble Lords who have spoken this afternoon—and I honour their sentiments—I cannot myself feel that the present additional gift of £20,000,000 can be considered mean. I would not like that impression to get abroad with regard to this particular question. Meanness to Malta would be a most deplorable thing, and no one in this House would countenance it for a moment. But I do not personally feel that this additional gift can be considered in that light.
Having said that, I would add, with all the emphasis at my command, that nothing we can contribute is too great for Malta's deserts. Before the war we were a rich, a proud, and a powerful nation. We are still powerful, and we are still proud, but at the moment we are not quite so rich as we were. Yet what we give to Malta we give with a full heart, as a tribute of our affection and esteem for an island which, though small ill area, has proved herself very great in spirit.
6.22 p.m.
VISCOUNT HALL: The debate on the Second Reading of this Bill has been very short, but it has been very interesting. I am pleased that what opposition there has been has centred around just one point: as to whether the amount which this Bill will provide, in addition to the amount already given, is sufficient. I am indeed indebted to the noble Viscount, Lord Cranborne, for saying in his closing remarks that he did hope, notwithstanding the opposition of noble Lords, that they themselves would not like to convey to the people of Malta that there is any intention by His Majesty's Government to

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regard this amount, which is freely given, as being in any way mean. After all, it must be remembered that the contribution, quite apart from the grant-in-aid and subsidies given for war damage and reconstruction, alone is more than the total income of Malta for two years. Sir Wilfrid Woods referred to that fact in his very able report, where he estimated the annual income at about £14,000,000 per annum. To give a free gift of more than the total income for two years cannot be regarded in any way as being mean.
The question of the finality of the amount was fully debated in another place, and I do not know that I can add anything to what has already been said. It is a question very largely of the interpretation of the pledge which was given. May I say that I listened with great pleasure to the speech of the noble Lord, Lord Lloyd? I had the very great pleasure and the privilege of being Under-Secretary to his late and very honoured father; indeed, I assisted in getting the Colonial Development and Welfare Bill through the House of Commons, and the late Lord Lloyd was successful in getting the Bill through your Lordships' House. I regard his passing as a great loss, he was a man of very great ability who did an enormous amount of work for the Empire—Colonies or Dominions. I know that it will be a case of a noble son following a noble father. There is nothing more that I can say, other than that Malta is deserving of every consideration.
It has been my privilege to visit Malta. I have seen the rubble. At the same time it is as well that Malta should know how much she will have to go along with; then she can arrange her own resources. I am hopeful that not Memorial Trust only will she be able soon to balance her budget, but that she will be able to make a valued contribution to the reconstruction and the building up of the social services without in any way expecting, and possibly depending too much on, assistance from a country which is faced with a financial problem which will not only cause us some concern in the near future, but will cause us a great deal of concern for many years to come. A free grant of £20,000,000, plus what will be received out of the Colonial Welfare and Development Fund, is not an amount which any of the members of your Lordships' House—or, indeed, any one in the country—need fear can be described as
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other than a very valuable contribution made to a very gallant people. And it will give them a good deal of assistance in building up their own economy and in improving the social services which are so much desired by the people of Malta.
6.27 p.m.
LORD STRABOLGI: Before my noble friend sits down, would he take note of my suggestion that some of the surplus labour may be invited to come here?
VISCOUNT HALL: I certainly will put the suggestion made by the noble Lord to the Minister of Labour and the Minister of Agriculture.
On Question, Bill read 2a; Committee negatived.

AIR NAVIGATION BILL. [H.L.]
Read 3a (according to Order): Amendments (Privilege) made; Bill passed and sent to the Commons.

CHESHIRE AND LANCASHIRE COUNTY COUNCILS (RUNCORN WIDNES BRIDGE, ETC.) BILL. [H.L.]
DUDLEY CORPORATION BILL. [H.L.]
HAVANT AND WATERLOO URBAN DISTRICT COUNCIL BILL. [H.L.]
NAZEING WOOD OR PARK BILL.[H.L.]
SOUTHEND-ON-SEA CORPORATION BILL. [H.L.]
SUNDERLAND CORPORATION BILL. [H.L.]
Committed: the Committees to be proposed by the Committee of Selection.

COTTON INDUSTRY WAR MEMORIAL TRUST BILL.
Report from His Majesty's Attorney-General received, and ordered to lie on the Table.
  CIVILIAN DRIVERS OF SERVICE VEHICLES.
  CIVILIAN DRIVERS OF SERVICE VEHICLES.
  SUNDAY ENTERTAINMENTS ACT, 1932.
  SUNDAY ENTERTAINMENTS ACT, 1932.