Sitting of 18 February 1947

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

ROAD TRANSPORT INDUSTRY (PETITION)
Mr. Glossop: I beg leave to present a Petition on behalf of a large number of persons in the Northern Traffic Area against the nationalisation of the road transport industry. The Petition has been signed by 22,752 persons. The Prayer of the Petition is as follows:
"We, your Petitioners, numbly pray your honourable House to reject any proposals which may hereafter be submitted to Parliament for approval, or for legislation with the object of replacing private enterprise in the provision of road transport by a nationalised, or Government-controlled system of trans. port, and your Petitioners as in duty bound will ever pray "
To lie upon the Table.

ORAL ANSWERS TO QUESTIONS
  MINISTRY OF PENSIONS

    Surgical Boots (Repair)
    Captain John Crowderasked the Minister of Pensions what facilities are available to disabled ex-Servicemen to have their surgical boots and shoes repaired free of charge, particularly in cases where special skill is required in carrying out the repairs.
    The Minister of Pensions (Mr. Wilfred Paling): Normally, when a pensioner finds that his surgical boots or shoes require repair, he sends them to my regional office. They are then sent to the makers, who carry out the necessary repairs. During the war, provision was also made whereby certain repairs, which do not necessitate interference with the
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    surgical features of the boots or shoes, can be carried out by any local firm. The account is paid direct by my office, or it may be settled by the pensioner, who may then claim a refund.
    Captain Crowder: What steps is the Minister taking to inform ex-Servicemen interested of this scheme?
    Mr. Paling: It did receive a fair amount of publicity when it was started during the war. As far as I know, most of the men are aware that it exists.

    Personal Case
    Mr. Heathcote Amoryasked the Minister of Pensions why the widow of 236887 C.P.O. Louis Lake, late R.N., who died of his pensionable disability on 14th March, 1938, has had her claim for a widow's pension rejected, Ministry of Pensions reference No. 8/N/1946.
    Mr. Wilfred Paling: When it was decided that the widow of a man who died as a result of war service should be eligible for pension although the marriage took place after the disability was sustained, it was explained that the arrangement would apply to deaths occurring from 3rd September, 1939, onwards, but that any further measure of retrospection was not possible. In the case in question, the marriage took place after discharge, and the pensioner died early in 1938.
    Mr. Amory: Does the Minister consider it fair that widows of men disabled in previous wars should be worse off than those of the last war, particularly as, being older, their need is often greater? Is he satisfied that the present position should continue?
    Mr. Paling: We saw this difficulty when this was given, and we discussed it, and decided that we could only go back to the beginning of the last war. [HON. MEMBERS: "Why?"] It was considered administratively impossible to go back nearly 30 years.

  PRISONERS OF WAR

    Arrests, Witney
    Mr. Dodds-Parkerasked the Secretary of State for War whether he will now make a statement on the circumstances in which four German prisoners of war, working at Bicester, were arrested at Witney, attempting to sell motorcar tyres to a civilian.
    The Financial Secretary to the War Office (Mr. John Freeman): As the hon. Member was informed by letter, these German prisoners were arrested by the civil police as they were making their first attempt to sell to a civilian four tyres, stolen from the ordnance depot at Bicester. The prisoners were to have been tried on 6th February, but the trial has had to be postponed until tomorrow.
    Mr. Dodds-Parker: What reason is there for postponing this trial? The facts seem to be quite clear.
    Mr. Freeman: I cannot answer that without notice. But it is a very short postponement, and the trial is taking place tomorrow.

    Repatriation
    Mr. Attewellasked the Secretary of State for War if he is aware of the concern of the people at the detention in this country of approximately 350,000 prisoners of war some 19 months after the cessation of hostilities; that the present scheme of repatriation of 15,000 per month will compel those captured in 1944–45 to remain in this country for long duration; and if he will consider repatriation of all married men in the immediate future and so allow families to be reunited.
    Mr. Stokesasked the Secretary of State for War on what date he expects to increase the rate of repatriation of prisoners of war from this country from the present figure of 15,000 a month to 30,000 a month.
    Mr. J. Freeman: The present scheme of repatriation is on the basis explained in the Government's statement of 12th September, 1946. It was decided that priority of repatriation should be based on political and economic factors and length of captivity alone, with provision for special compassionate cases. There is no intention at present of changing this basis. Similarly the rate of repatriation will continue for the time being at the present rate.
    Mr. Stokes: As my hon. Friend has not answered Question No. 20, may I ask him when the Government propose to increase the number to 30,000 a month, which is the rate desired by the Control Commission in Germany? Is he also aware that the feeling of the vast majority of people in this country is that prisoners of war should be returned home before the end of this year?
    Mr. Freeman: If my hon. Friend will read the answer I have just given to him, he will see that I did answer his Question in my last sentence. With regard to his second supplementary question, that is a matter of opinion.
    Mr. Hector Hughes: In the case of prisoners of war who are likely to remain in this country for some years, will the hon. Gentleman consider using them in industry? Will he also consider bringing their families to join them here?
    Mr. Freeman: I am not aware of any prisoners of war who are likely to stay here for some years.
    Mr. Driberg: Will my hon. Friend bear in mind that I am still balloting daily for the Adjournment on this subject?
    Mr. Stokes: On a point of Order. May I join with my hon. Friend in saying that I shall seek an opportunity to debate this matter on the Adjournment? It is most unsatisfactory.

    Restrictions (Relaxations)
    Mr. Symondsasked the Secretary of State for War, what further relexations he is contemplating of the regulations regarding German prisoners of war in this country.
    Mr. J. Freeman: As my right hon. Friend explained to hon. Members last week, he is considering the possibility of further relaxation of restrictions, but details cannot be given at present.
    Mr. Symonds: Will my hon. Friend continue to bear in mind the use of public transport, as these men have difficulty in getting back to their camp by dusk, when they have been invited out for a cup of tea?
    Mr. Freeman: We will certainly consider that.
    Mr. H. D. Hughes: Will my hon. Friend bear in mind that the five mile limit operates most inequitably between those stationed near a town and those who are stationed further in the country, and will he see if anything can be done to overcome this handicap for those who are stationed in the country?
    Mr. Freeman: That is precisely what we are considering.

    European Relief (Subscriptions)
    Mr. Symondsasked the Secretary of State for War if he will alter the present regulations so as to allow German prisoners of war to raise money for European relief, if they wish, rather than for their own welfare funds.
    Mr. J. Freeman: I would refer my hon. Friend to the first part of the reply given to the hon. Member for Westmorland (Mr. Vane) on 3rd December, to which I cannot usefully add anything.

    Snow Clearance
    Mr. Dyeasked the Secretary of State for War how many commandants of prisoner-of-war camps in Norfolk were asked by the county surveyor for prisoner labour to assist with clearing snow-blocked roads during the past fortnight; how many supplied prisoners of war and how many refused; and for what reason was the refusal, seeing that the prisoners were unable to do agricultural work.
    Mr. J. Freeman: Two commandants of prisoner-of-war camps in Norfolk were asked to supply labour for road clearance and both did so. None refused.

    Toft Hall Camp
    Mr. Stokesasked the Secretary of State for War how many prioners of war are detained in Toft Hall Camp, Knutsford, Cheshire: and what are their nationalities
    The Secretary of State for War (Mr. Bellenger): There are 1,516 prisoners of war held at Toft Hall Camp, claiming 26 different nationalities. Ninety-five per cent. of these prisoners of war are German, or of German racial origin, with residential qualifications in the countries to which they wish to return
    Mr. Stokes: Is my right hon. Friend aware that the prisoners of war themselves complain that they belong to 38 different nationalities, and that the majority of them were pressed into German service against their will? Will please hurry with the examination of their individual cases?
    Mr. Bellenger: Yes, Sir. I will do my best.

  BRITISH ARMY

    Personal Cases
    Mr. Osborneasked the Secretary of State for War if he is aware that 2014492 Lance-Corporal Hickson has not received any pay for his rank; that the matter was referred to him by the commanding officer, R.E., Leicester, last May, and by the Grimsby British Legion on 6th December; that to neither communication has an acknowledgment been sent; and if he will expedite the consideration of ex-Servicemen's grievances.
    Mr. J. Freeman: Lance-Corporal Hick- son was not entitled to extra pay, as his appointment was that of local unpaid lance-corporal. It was explained to him at the time that the appointment was made purely to give him added authority in dealing with various units, and that he would not be eligible for additional pay. He signed a declaration that he understood these conditions. There was at no time any question of his being made a paid lance-corporal, and there was no vacancy for such an appointment in the war establishment of the unit. I regret the fact that the British Legion's letter was not acknowledged, and the delay in dealing with the representations, which was due to movement of wartime accounts to a central office.
    Mr. Osborne: Quite apart from the merits of this case, is it not making grievances seem worse to ex-Servicemen when those grievances are not looked into properly? Will the hon. Gentleman see that this is looked into promptly in future?
    Mr. Freeman: I recognise the implication of the question. There was no unreasonable delay in this case at all. I am sorry that the letter was not acknowledged. But Lance-Corporal Hickson was perfectly well aware of the situation the whole time.
    Mr. Yatesasked the Secretary of State for War when the hon. Member for Ladywood can expect a reply to his letter of 16th January as to whether the sentence of three years' penal servitude imposed upon 2198535 Sapper F. S. Hadley, R.E., C M.F., on 13th August, 1946, has been reconsidered, in the light of the domestic circumstances, particulars of which were forwarded to him on 4th October last.
    Mr. Bellenger: I understand that Sapper Hadley has now been released from prison and is awaiting posting. As soon as confirmation is received a reply will be sent to my hon. Friend with any further details available.
    Mr. Yates: Will the right hon. Gentleman take steps to see that Members of Parliament get more prompt answers to their letters?
    Mr. Bellenger: I do not think that is fair of my hon. Friend. A considerable speed-up in answers to hon. Members has been achieved in my Department; but I am bound to say that hon. Members' letters to me do not seem to be decreasing.
    Mr. De la Bère: Why should they?
    Mr. Doddsasked the Secretary of State for War if he is yet in a position to give a decision in the case of 7620810 Craftsman Westhead, details of which were brought to his notice by a letter. dated 23rd October, 1946.
    Mr. Bellenger: Craftsman Westhead's petition has now been fully considered but I am satisfied that no legal grounds have been disclosed for interfering with the convictions.
    Mr. Dodds: Is my right hon. Friend aware that I received a letter from him, dated 21st November, informing me that the petition was being considered, and 11 weeks later I received another letter stating that the petition was still being considered; and does he not think that the 11 weeks which have elapsed is a long time even for the War Department?
    Mr. Bellenger: I think the main burden of my hon. Friend's Question was whether a decision has been arrived at. A decision has been arrived at.
    Mr. Leslie Hale: Is the Minister aware that I wrote to him about this matter in November, that this man has been serving his sentence all this time, and letter after letter has been sent; and does he now tell this House that it is an adequate explanaation merely to say, "We have come to the conclusion that the matter is not worth considering," without giving any reasons at all?
    Mr. Bellenger: I do not like discussing these matters publicly, but, as my hon. Friend has asked me, I can tell him that I find no reason to interfere with this sen
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    tence of two years' hard labour which was imposed for stealing machinery.
    Mr. Hale: Yes—but we asked the right hon. Gentleman to write to us.
    Mr. Dodds: Is my right hon. Friend aware that I asked this Question because I waited 11 weeks for the petition to be considered?

    Colour Bar
    Mr. Dribergasked the Secretary of State for War if he can now state the result of his discussions with the First Lord of the Admiralty and the Secretary of State for the Colonies regarding the abolition of the colour bar against applicants for Regular engagement in the Army and the R.N.
    Mr. J. Freeman: The discussions are continuing but I cannot say when conclusions are likely to be reached.
    Mr. Driberg: Are these discussions going on fairly continuously, or just occasionally—once a month or something like that?
    Mr. Freeman: They are going on in the way which seems to us the most appropriate.

    Water and Fuel, Long Marston
    Mr. Dribergasked the Secretary of State for War if he is aware of the unsatisfactory conditions prevailing in the camp at Long Marston, near Stratfordon-Avon, the supply of water for washing and fuel for heating being particularly inadequate; and if he will cause these conditions to be investigated thoroughly and improved.
    Mr. J. Freeman: Some time ago we thought that it would be possible to abandon this camp, but it is still needed. Consequently considerable improvements that were necessary were put in hand and are still being carried out, particularly in connection with the water supply. We have had no complaints of unreasonable shortage of fuel for heating though naturally the greatest economy is being exercised at present.

    Officers (Permanent Rank)
    General Sir George Jeffreysasked the Secretary of State for War the policy of the Army Council regarding the continuation, or otherwise, of temporary and

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    war substantive rank of officers; and whether it is proposed to grant any form of higher permanent rank to those who did specially good work in the temporary rank held by them and who are not yet due for substantive promotion.
    Mr. Freeman: The question of adapting the wartime rules governing the grant of temporary and war substantive rank to present circumstances is being examined at the moment. We do not propose to grant any higher permanent rank to officers who have done specially good work in temporary rank but such good work is of course taken into account when selections are made to fill appointments.
    Sir G. Jeffreys: Is it not about time that this matter was definitely settled, and a decision come to upon it? Is the hon. Gentleman aware of the great dissatisfaction and the numberless heartburnings that occurred after the 1914ȓ18 war, when temporary rank had to be relinquished, and will he not take into consideration the possibility of a judicious use of brevet rank, in order to reward these officers?
    Mr. Freeman: Of course, we have given consideration to that. It is precisely because of the mistakes which were made last time that we are endeavouring to work this matter out very carefully on the present occasion.
    Mr. Bossom: Is it not most undesirable that an officer who has held a rank and provided the pay for his family for many years, should suddenly be reduced in this way?
    Mr. Freeman: The problem is that we have to provide a career in the Army for the number of senior officers who can get to the top. It really cannot be dismissed in the manner which has just been suggested

    Italy (Leave)
    Mr. Edelmanasked the Secretary of State for War whether, when the peace treaty with Italy is signed, troops now stationed in that country will be granted United Kingdom leave before reposting abroad.
    Mr. J. Freeman: Not necessarily, Sir. Some men with only a short time still to serve will be posted to this country. Others will be posted according to our requirements and the time they still have left before qualifying for repatriation or
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    release. Some may pass through this country on their way to other theatres and receive leave here, but this will not always be the case.
    Mr. Edelman: In order to mark the somewhat unobserved Treaty of Peace with Italy, will my hon. Friend consider giving special leave to certain men who have served for long periods?
    Mr. Freeman: No, Sir. There are already arrangements whereby men who have had long service overseas in those circumstances can get leave, and I do not think that it would be an appropriate way to mark the peace.

    Land Requirements (Wales)
    Mr. Watkinsasked the Secretary of State for War why he could not supply the hon. Member for Brecon and Radnor, on 4th February, information as to land requirements in Welsh counties, in view of the fact that the Public Relations Department of the Western Command gave this information on 3rd February which was broadcast in the Welsh Regional news that evening.
    Mr. J. Freeman: the land requirements of the Services are at present under discussion by the Interdepartmental Committee, and in many cases are also being examined in conjunction with local authorities and other interests. Until this consideration is complete and its results have been examined by the Cabinet, no useful purpose would be served by announcing details of the various proposals made. The publication in Western Command of certain provisional proposals affecting that command was premature and is regretted.
    Sir Henry Morris-Jones: Will the hon. Member indicate when the Government will be in a position to give these figures? Is he aware that a national conference has been arranged in Wales by the Welsh Parliamentary Party, and that we should like to have them before that date?
    Mr. Freeman: As there is a Question on the Order Paper to the Prime Minister this afternoon, the question could perhaps be left until then.
    Mr. Watkins: Can the information given in that statement now be regarded as correct?
    Mr. Freeman: The statement was un-authorised. I have nothing to add.
    Mr. David Grenfell: Will my hon. Friend say whether that statement which appeared was true or untrue?
    Mr. Freeman: The statement cannot possibly be true as it stands, because the whole matter is being considered. It may well be that some previous information of our hopes may have been published, but whether those hopes will be met is another matter altogether.
    Mr. Grenfell: Before my hon. Friend and his right hon. Friend decide finally, will they consult the representatives of Wales in this House?
    Mr. Freeman: Certainly, Sir.
    Mr. Watkinsasked the Secretary of State for War the number of acres of land it is proposed to acquire permanently for battle training in Breconshire; how much they now hold permanently; how much of the total acreage is enclosed land; how much is included in the proposed National Park; how many acres are classed as good agricultural land; and how much of it was cultivated during the period of the last war.
    Mr. Bellenger: As has already been stated the whole question of Services land requirements is under consideration and it is not yet possible to give particulars either for the country as a whole or for individual counties.
    Mr. Watkins: Can my right hon. Friend advise me how my constituents can give evidence before the inter-Departmental Committee and local enquiries unless they get this information?
    Mr. Bellenger: I think the existing machinery gives every possibility for the local people to know precisely what it is that the War Office or other Service Departments may want.
    Mr. Watkins: What is the local machinery?
    Mr. Bellenger: I could answer that question but I am afraid Mr. Speaker would not allow me to occupy the time of the House by giving the information now.
    Mr. Hopkin Morris: If the right hon. Gentleman is unable to give the figures because the matter is under consideration, can I ask why the Public Relations Officer
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    of Western Command has issued the figures to the Press?
    Mr. Bellenger: That has not been brought to my notice, but. it would be quite irregular if he had done so.
    Mr. Watkins: Owing to the extremely unsatisfactory nature of the reply, I give notice that I shall raise the matter on the Adjournment.

    Leave Centre (Düsseldorf)
    Mr. Stokesasked the Secretary of State for War on what date it was decided to make Düsseldorf a leave centre supplementary to Brussels; and whether this proposal has now been abandoned.
    Mr. J. Freeman: The decision was taken on 23rd May, 1946. The proposal has not been abandoned.
    Mr. Stokes: My Question was addressed to the Secretary of State for War. Might I ask my right hon. Friend whether he is aware that grave concern is felt by people in Germany at this decision to herd into a devastated area a joy centre which is much better kept in Brussels?
    Mr. Freeman: With regard to the first part of my hon. Friend's supplementary question, I am to be regarded as a plenipotentiary. In reply to the second part, the project has not been abandoned but it has a very low priority, and is not likely to be carried out in the near future. It is being re-examined in conjunction with all welfare activities.
    Mr. Stokes: Will my hon. Friend make that clear to the Germans, who are very concerned about it?
    Mr. Freeman: I have no doubt that they will read my hon. Friend's Question.
    Mr. Medlicott: Will the Minister resist the persistent efforts of certain Members of this House to deprive the occupying British troops of the reasonable amenities to which they are entitled?
    Mr. Freeman: Yes, Sir.

    Dump. Horley
    Mr. Toucheasked the Secretary of State for War if he is aware that since October the Dorking and Horley Rural District Council have been trying to get building materials released from his Department's dump at Horley as these

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    materials are urgently required for the council's temporary housing programme on Horley Garden Estate; that they have now been informed that his Department do not now intend to release any of these materials; and if he will get this decision revised in view of the urgent housing needs of the district.
    Mr. J. Freeman: The surpluses referred to in my right hon. Friend's reply to the hon. Member on 8th October have been disposed of and the dump now contains only component parts of hutting and camp structures and some cisterns which cannot be released since they are required for military use. I am informed by my right hon. Friend the Minister of Works that the surpluses already disposed of were unsuitable for the needs of the Dorking and Horley Rural District Council.

    Troopship, "Dunera"
    Mr. Ellis Smithasked the Secretary of State for War if he will inquire into the conditions on the ss. "Dunera" which sailed from India on 9th January and arrived here on 29th January; what was the ship used for prior to this voyage; how many men were on board; how were they fed; why was there such a contrast between how the officers were treated and the men; how many officers brought their wives; and how many servants were on board.
    Mr. Bellenger: H.M. I. "Dunera" is a vessel specially constructed and fitted for trooping service. and, before the voyage in question, she had been employed on trooping duties in the Indian Ocean. On the voyage to the United Kingdom she carried 354 cabin and 1,345 troopdeck passengers from Bombay and a further in cabin and ten troopdeck from Port Said. According to the official voyage reports, regulations governing the feeding and accommodation of officers and men in troopships were duly complied with and no complaints are recorded, but if my hon. Friend has any special points which he wishes to bring to my notice. I will have further investigations made. There were 19 accompanied and ten unaccompanied officers' wives No servant. were embarked

    Departmental Stationery
    Mr. John Morrisonasked the Secretary of State for War what total stocks of stationery and envelopes are held by his Department.
    Mr. Bellenger: I assume the hon. Member is referring to stocks held by the War Office itself as a Department of State, as distinct from stocks held by units and establishments of the Army at home and abroad. The total is about 100 tons.
    Mr. Morrison: Will the right hon. Gentleman take into account the increasing difficulty experienced by civilians and business organisations in getting supplies of stationery at present and in ordering, further stocks?

    Personal Cases
    Mr. Boardmanasked the Secretary of State for War whether 3654359 Private J. Gerrard, Border Regiment, is still under arrest; under what circumstances he was arrested as an alleged deserter after his release from the Service under Class A; whether there is any proof of delivery of papers requesting return to his unit; how long the coalmining in dustry has been deprived of his services; and, in the case of wrongful arrest, what compensation is payable.
    Mr. Bellenger: As the answer is long, I will, with permission, circulate it in the OFFICIAL REPORT.
    Following is the answer:
    Private Gerrard is a Regular soldier who, while on a seven years' engagement, was convicted of desertion in February, 1945, and forfeited his previous service. His Colour service therefore is not due to expire till February, 1952. In June last year he was erroneously sent on release leave, clue to expire on 22nd September. The mistake was noticed and action to recall him taken in July. He did not report and was in December arrested by the civil police Whilst in open arrest he absented himself but returned to his unit on 11th January.
    He was tried on two charges of absence without leave. the first for the period from the date of his recall from release leave to 7th December and the second for the period from 24th December to 11th January. The first charge was dismissed as there was no proof that he had received the recall notice, which had been sent by ordinary post. On the second charge he was admonished and forfeited 19 days' pay. There is no question of wrongful arrest in this case, nor of the coalmining industry being deprived of his services since he was a Regular soldier before the war.

    Woodhall Spa Camps
    Commander Maitlandasked the Secretary of State for War whether he now intends to evacuate Woodhall Camp in Lincolnshire; and, if not, for what purpose it is proposed to use this camp.
    Mr. Bellenger: There are two camps at Woodhall Spa. Roughton Moor and Kirby Moor. Both camps are occupied by the Polish Resettlement Corps, and no date for the release of these camps can be given at present.

    Complaints
    Dr. Santo Jegerasked the Secretary of State for War what percentage of complaints and grievances coming to his Department from soldiers come through Members of Parliament and newspaper channels.
    Mr. Bellenger: I have not available separate figures of soldiers' complaints included in the total correspondence received from hon. Members and newspapers or from other sources.

    Requisitioned Houses, Northern Ireland
    Mr. Gageasked the Secretary of State for War how many private residences in Northern Ireland are still occupied by the military authorities.
    Mr. Bellenger: Ten, Sir.
    Mr. Gage: When will these houses be released in view of the housing shortage in Northern Ireland and the reduction of military personnel?
    Mr. Bellenger: We have effected a considerable reduction. There are only ten left. I will do my best to get rid of them as soon as I can.

    Flame-throwers (Snow Clearance)
    Mr. Swinglerasked the Secretary of State for War how many flame-throwers are at the Army's disposal in Britain; what consideration he has given to their employment for the clearance of snow and ice-bound tunnels and roads; and what action has resulted.
    Mr. Bellenger: Experiments in clearing snow and ice have been carried out but the results were not encouraging. The equipment which is in this country, however, is available for further experiments or assistance if required.

    Brigadier de Winton (Murder)
    Major Mott-Radclyffeasked the Secretary of State for War whether he has any statement to make regarding the murder of Brigadier R. W. M. de Winton, commanding 13th British Infantry Brigade, at Pola, on 10th February.
    Mr. Bellenger: As hon. Members will have heard, Brigadier de Winton was murdered on 10th February I take this opportunity of expressing my sincere sympathy with his relatives in their sad loss. I am awaiting the results of investigations that are being made locally into this dastardly crime.
    Major Mott-Radclyffe: Can the right hon. Gentleman confirm or deny the report which appeared in at least one newspaper, to the effect that information was received that an incident of this sort was likely to occur; and, further, can he inform the House what representations have been made to the Allied Control Commission, who, presumably, are responsible for the administration of law and order in that area?
    Mr. Bellenger: With regard to the first part of the question, I can neither deny nor confirm it at the moment. I hope to get full information shortly. I should like notice of the second part of the question.

    Territorial Officers
    Brigadier Lowasked the Secretary of State for War how many officers holding T.A. commissions were commanding T.A. armoured corps, artillery and infantry units on 3rd September. 1939; and, of these, how many were commanding the same units on 1st July, 1940, and how many had been promoted to the rank of brigadier by that date.
    Mr. Bellenger: To obtain the information asked for would involve considerable research and reference to records. Which I feel could not be justified in present circumstances.
    Brigadier Low: How has the right hon. Gentleman been able to come to a decision whether or not he should appoint Regular officers to the Territorial Army in the future, if he has taken no account of these figures?
    Mr. Bellenger: The difficulty at the moment is to get the number of gentlemen

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    who can give the time that will be necessary to fill these positions. For the moment we have had to appoint Regular officers. Later on I hope it will be possible for gentlemen who have had previous war service to assist us.
    Brigadier Low: Bearing in mind the right hon. Gentleman's answer to a previous Question in connection with the maintenance of temporary rank, would it not help to solve his problem if he appointed many of the large number it lieutenant-colonels there are at present to command some of the Territorial units?
    Mr. Bellenger: I do not think that arises from this Question, which asked for certain information which I am unable to give.
    Colonel Clarke: Does not the right hon. Gentleman realise that it will not be too easy to recruit men to these Territorial units after this change is made, if these units do not possess officers recruited locally, and will the right hon. Gentleman do his best in that direction?
    Mr. Bellenger: Yes, Sir. I realise the difficulty to which the hon. and gallant Gentleman has drawn my attention.

    Dutch Troops (Training)
    Mr. Longdenasked the Secretary of State for War the numbers of Dutch officers and men who were trained in Britain during 1946; how many are being trained at the present time; and how many of them have left this country for Indonesia since the signing of the truce in November last.
    Mr. Bellenger: One thousand five hundred and twenty-five Dutch officers and 9,312 other ranks were trained in this country during 1946, and 28 officers and 201 other ranks are being trained here at present. No Dutch troops have been sent direct from this country to Indonesia during 1946 or 1947.
    Mr. Mikardo: Could my right hon. Friend say why we are giving facilities for the training of Dutch troops for their war against the Indonesians, and how much it is costing the British taxpayer?
    Mr. Bellenger: The answer is that it is not for that purpose at all. Some of these young men joined the British Army during the war and want to complete their training.

    Indonesia (British Arms)
    Mr. Longdenasked the Secretary of State for War if he will give the amounts and kinds of arms left by the British for the Dutch in Indonesia; and what arms are now being provided by this country.
    Mr. Bellenger: Arms of the appropriate natures were provided for Dutch units in Indonesia on a normal basis for a force of all arms numbering about 62,00o. We are in the process of providing similar arms for a further 19,000 Dutch troops. It would be impossible, without an excessive amount of work, to separate the arms that were supplied in the Far East from those that came from stock in this country.
    Mr. Mikardo: Could the right hon. Gentleman now answer the supplementary question which he did not answer earlier, namely, what is the cost to the British taxpayer of our supplying and furnishing a Dutch Army to fight the Indonesians?
    Mr. Bellenger: If my hon. Friend will put down a Question, I will endeavour to supply him with that information.

  POLISH FORCES

    General Anders (Pay)
    Mr. Wyattasked the Secretary of State for War what is the amount of the monthly payments made by the Government to General Anders by way of personal salary; from what funds are these payments made; how long is it proposed to continue the payments; and what is the purpose of the payments.
    Mr. J. Freeman: Like other Polish officers and soldiers still in the Polish Land Forces, who served the Allied cause well during the war, General Anders is receiving the pay and allowances of his rank (£88 12s. a month) pending arrangements for his resettlement. The payments are made from Army Votes.
    Mr. Wyatt: As it has now been established that General Anders is the head of a private army, which has no statutory authority, is it not about time that this payment was discontinued?
    Mr. Stokes: Is my hon. Friend aware that the General Officer Commanding in Italy considered that we could not have.

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    won the war in Italy without the help of General Anders? Is it not a pity that such personal matters should be raised in this House?

    Arms
    Mr. H. Hyndasked the Secretary of State for War whether all members of the Polish armed forces and resettlement forces have been disarmed.
    Mr. Bellenger: I am looking further into the question of retention of arms by other Polish troops.

    Screening
    Mr. H. Hyndasked the Secretary of State for War what happens to Poles who are screened on seeking enrolment in the Resettlement Corps and are thereupon found to be unacceptable because of their Fascist sympathies.
    Mr. Bellenger: It is only applicants to, commissions in the Polish Resettlement Corps who are screened before enrolment. No decision has yet been made about the future of those who are found to be unacceptable.
    Professor Savory: Is not the right hon. Gentleman aware that there are no Poles with Fascist sympathies, that the term is absolutely improper, and that they are only loyal to their oath to the President of the Republic—to the legitimate President of the Polish Republic?

    Resettlement Corps (Numbers)
    Mr. J. Langford-Holtasked the Secretary of State for War the number of Poles in the Polish Resettlement Corps on the latest convenient date and the percentage thereof who have already applied for British citizenship.
    Mr. Bellenger: On 1st February. 59,50o Poles had enlisted in the Resettlement Corps, and the figure is now rather over 62,000. I regret that I have no figures available of the number of applicants for British citizenship.

  PRIME MINISTE (AUSTRALIAN AND NEW ZEALAND INVITATIONS)
  Mr. Butcherasked the Prime Minister whether he proposes to visit Australia and New Zealand during the current year.
  The Prime Minister (Mr. Attlee): The Australian and New Zealand Governments very kindly invited me last summer to visit Australia and New Zealand. I had hoped to do so during the summer Recess, but the pressure of affairs was so great at that time that I had, with keen regret, to inform Mr. Chifley and Mr. Fraser that I should have to postpone my visit. Mr. Chifley and Mr. Fraser most generously kept this invitation open, and it is my earnest hope that I may be able to pay this visit. I am sure, however, that the House will realise that, in view of the urgent pressure of affairs both at home and abroad, it is very difficult for me to suggest at present any firm date for the postponed visit to Australia and New Zealand. I should like to take this opportunity of saying how deeply I appreciate these invitations and how much I am looking forward to visiting the two countries.

  DISPLACED PERSONS (EMPLOYMENT)
  Mr. Martin Lindsayasked the Prime Minister whether, in view of the shortage of skilled labour in many branches of industry, he will arrange for a parliamentary mission to visit U.N.R.R.A's. displaced-persons camps in the British zone in Germany at an early date, to form an impression of the potential labour available.
  The Prime Minister: No, Sir. I do not feel that such a mission is necessary, as my right hon. Friend the Minister of Labour is proceeding, in association with my hon. Friend the Chancellor of the Duchy of Lancaster, to set up an organisation in the British zones of Germany and Austria for the classification and selection of displaced persons against opportunities of employment in this country.
  Mr. Lindsay: Does not the Prime Minister think that it is a great pity that this organisation about which he has just told us was not set up many months ago?

  TREE FELLING LICENCES
  Mr. Vaneasked the Prime Minister if he is aware of the dissatisfaction within the industry with the arrangement whereby the Board of Trade controls felling licences and issues schedules of maximum prices which may be paid for homegrown timber; and if he will arrange an early transfer of these powers to the Ministry of Agriculture.
  The Prime Minister: The answer to both parts of the Question is, "No, Sir."
  Mr. Vane: Is the Prime Minister aware that the exercise of these powers by the Board of Trade is working out in exact opposition to the declared forestry policy of the Government-, as explained to the House by the Minister of Agriculture some months ago?
  The Prime Minister: That is not my information. My information is that the Board of Trade keeps in touch with the Forestry Commission.

  FUEL EMERGENCY (U. S. OFFER)
  Mr. Astorasked the Prime Minister (1) if he intends to avail himself of President Truman's announcement made in Washington on 13th February, that he is willing to do everything in his power to relieve the present crisis in this country due to the coal situation; and
  (2) if he will convey the thanks of the British people to President Truman and the people of the U.S.A. at the President's offer made in Washington on 13th February, to do everything in his power to relieve the present crisis in this country due to the coal situation.
  The Prime Minister: The hon. Member will doubtless have seen my message of 14th February to the President of the United States, in which, while feeling hound to decline his offer to divert colliers to this country, I expressed the warm appreciation of His Majesty's Government for this spontaneous and friendly offer of help.

  NATIONAL FINANCE

    Old Age Pensioners (Investments)
    Mr. William Shepherdasked the Chancellor of the Exchequer the interest on capital that is allowed in determining the means of an applicant for an old age pension under the Act of 1936; whether he is satisfied that this rate is reasonable; or what steps are being taken in connection with it.
    The Chancellor of the Exchequer (Mr. Dalton): The rules for calculating means are prescribed in the First Schedule to the Act. As regards the second and third parts of the Question, I would refer the hon.
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    Member to my reply on 24th January to the hon. and learned Member for Chester (Mr. Nield).
    Mr. Shepherd: Will the Chancellor of the Exchequer say what those rates of interest are, and whether they are justified in present circumstances?
    Mr. Dalton: Yes, Sir. Of course, these figures relate only to the non-contributory pensions, where the whole cost is paid by the taxpayer, and, in such cases, it is not unreasonable that a person who possesses means should be required to pay some of them into a life annuity.
    Lieut.-Commander Gurney Braithwaite: But where the applicants have the misfortune to be railway stockholders, is their reduced income taken into account?
    Mr. W. J. Brown: Can the Chancellor say whether there is, in fact, any relationship at all between the assumed yield of investments for the purposes of this calculation and the actual yield of Government stocks at the present time?
    Mr. Dalton: The arrangements are laid down, as I have said, in the first Schedule to the Act. [HON. MEMBERS' "What are they?"] Well, it can be read in the Act, and I could read it out, but it is readily accessible. The first £25 of capital is disregarded, the yearly value of the next £375 is taken as 1/20th of the capital value, and any excess over £400 is taken as one-tenth of the capital value.

    Smuggling of Money (Confiscation)
    Sir Hugh O'Neillasked the Chancellor of the Exchequer if he will explain the circumstances under which a sum of £65 was appropriated and confiscated by the Treasury from Mr. M. H. McMurtrie, an ex-Serviceman who had served throughout the war, on the occasion of his repatriation to Brazil in March, 1946.
    Mr. Dalton: This man was caught trying to smuggle money out of the country, contrary to the Defence (Finance) Regulations.
    Sir H. O'Neill: Is the right hon. Gentleman aware that this money was, roughly, the amount of this man's Service gratuity, and is it not a very savage punishment to inflict upon him to seize this money without any process of law, and, apparently, without any right of appeal?
    Mr. Dalton: No, Sir. I think that this is a thoroughly bad case. The man had £65 on his person, and, when asked, he said he had £4. He told a lie, and the money was forfeited—I think quite rightly.
    Sir H. O'Neill: Is it not human nature to err, and can the right hon. Gentleman search his heart and say that he has never gone through the Customs and made a false declaration?
    Mr. Dalton: No, Sir. I would not make any extravagant claim of that kind, but I think that, if I was caught as this man was caught, I should deserve to get what he has got.

    U.S. Loan Drawings
    Brigadier Mackesonasked the Chancellor of the Exchequer the estimated increase, expressed in percentage, in the volume of exports in 1947 as compared ' with 1938, necessary in order to avoid the exhaustion of the U.S. loan by 31st December, 1947.
    Mr. Dalton: Even if there was no increase, the loan would not be exhausted by 31st December, 1947, in the purchase of the agreed import programme.

    Non-Sterling Areas (Debts)
    Brigadier Mackesonasked the Chancellor of the Exchequer at what monthly rate this country is incurring further debts abroad in non-sterling areas.
    Mr. Dalton: About £30 million, including our drawings on the American and Canadian credits.

    Tax Offices (Lighting)
    Mr. Granville Sharpasked the Chancellor of the Exchequer to what extent modern office lighting has now been installed in tax offices dealing with Pay As You Earn; whether this has resulted in increased output from the same staff; and to what extent this and similar proved business efficiency methods are now being preferred to the employment of additional staff as a means of reducing arrears of work.
    Mr. Dalton: I hope to improve the equipment of tax offices as supplies become available. Experiments in improved lighting have already been undertaken in several offices.

    Sterling Balances
    Mr. Boothbyasked the Chancellor of the Exchequer what steps he is taking to prevent countries within the sterling area from using their accumulated sterling balances in London for the current purchase of British goods.
    Mr. Dalton: This question is being covered in our negotiations on sterling balances.
    Colonel Crosthwaite-Eyre: Is the Chancellor aware that, during the last financial year £100 million of sterling balances held by Indians have been used to buy British assets in India?
    Mr. Dalton: if the hon. and gallant Gentleman wishes to have the information checked, I shall be glad to do so.
    Mr. Boothby: Can the Chancellor say to what extent the countries to which we owe money at the present time have been able to use their balances for the purchase of goods on current account during the last year?
    Mr. Dalton: That is a statistical question. Perhaps the hon. Gentleman would put it down.

    Anglo-Argentine Agreement (U.S. Representations)
    Mr. Hollisasked the Chancellor of the Exchequer what representations, and on what dates, he has received from the U.S. Secretary of the Treasury in protest against the clause empowering the Argentine Government to dispose freely, within the sterling area, of its sterling balances in the event of a balance of payments un-favourable to the Argentine.
    Mr. Boothbyasked the Chancellor of the Exchequer how he reconciles the answers given to questions by the hon. Member for East Aberdeenshire and the hon. Member for Devizes (Mr. Hollis) on 5th November, 1946, in the last Session of Parliament, that he had received no representations on the subject of the Anglo-Argentine Economic Agreement from the Government of the U.S.A., and that no understanding had been reached between this country and the U.S.A. as to how we were to deal with our sterling obligations, with Mr. Snyder's letter of 31st October, 1946, protesting against Section 10 (ii) of the said Agreement, and his subsequent reply, released to the Press by the Treasury on 5th February.
    Mr. Dalton: I would refer the hon. Members to my reply to the hon. Member for Orpington (Sir W. Smithers) last Tuesday.

    Purchase Tax (Invalid Carriages)
    Sir Ian Fraserasked the Chancellor of the Exchequer if he will remove the Purchase Tax from a type of invalid car, to which his attention has been drawn, so as to bring it into line with other vehicles, such as invalid and motor chairs, for the disabled.
    Mr. Dalton: All invalid carriages are exempt from Purchase Tax, but all private cars are liable, and I could not make an exception for one particular car.
    Sir I. Fraser: Is the Chancellor aware that the particular vehicle to which I have drawn his attention is designed solely for disabled men, and is not an ordinary motorcar at all?
    Mr. Dalton: If it can be classified as an invalid carriage, it is already exempted from Purchase Tax, but, if it is a car, what I might call a dual purpose car, which could be used by a fit person as well as by a disabled person, then, I am afraid, it has to fall under the tax.

    Iraq (Reparations)
    Colonel Crosthwaite-Eyreasked the Chancellor of the Exchequer the amount that has been claimed by His Majesty's Government from the Government of Iraq to cover reparations and occupation costs.
    Mr. Dalton: Compensation for losses to British subjects in 1941, amounting to £120,000, was received and distributed. Iraq being an Ally, no question of military occupation arose.
    Colonel Crosthwaite-Eyre: Does not the Chancellor consider that since our Forces, irrespective of the question of occupation, did, in fact, take charge of this country to prevent it falling under German sway, the least the Iraq Government can do is to pay their fair portion of the war costs?
    Mr. Dalton: That might be argued because the Raschid Ali revolt took place in May, 1941, and, in respect of that, there are ascertainable compensation claims which have to be met.

    Palestine (Defence Expenditure)
    Colonel Crosthwaite-Eyreasked the Chancellor of the Exchequer the amount that has been claimed by His Majesty', Government from the Palestine Government to cover that country's share in the expenses incurred by this country in the defence of Palestine.
    Mr. Dalton: The Government of Palestine contributes £42,797 a year towards the cost of the Transjordan Frontier Forces. It also meets the cost of the Palestine Police, the cost of the Cyprus camps for illegal immigrants, and expenditure on making good property and compensating individuals in connection with terrorist outrages. I am considering with my right hon. Friend the Secretary of State for the Colonies whether Palestine should make any further contribution to the cost of keeping order in that country.
    Colonel Crosthwaite-Eyre: Will the Chancellor bear in mind that the Palestine Government should certainly bear their fair share of expenses incurred by the British Eighth Army?
    Major Legge-Bourke: Arising out of his original reply, can the Chancellor say whether the term "property" includes railways?
    Mr. Dalton: I should expect so, but perhaps the hon, and gallant Gentleman will let me look it up.

    Latin America (British War Claims)
    Colonel Crosthwaite-Eyreasked the Chancellor of the Exchequer what counter-claims on war balances have been submitted to those Latin-American States which joined the United Nations at a late date, and which benefited from neutrality at the expense of the war effort of this country.
    Mr. Dalton: I am not sure what States the hon. and gallant Member has in mind, but, in all negotiations about sterling balances account must be taken of the comparative war effort of the parties.

    Territorial Army Allowances (Tax)
    Sir G. Jeffreysasked the Chancellor of the Exchequer whether the pay, the training expenses allowance and the annual bounty, recently announced for the T.A., or any of these, will be subject to Income Tax.
    Mr. Dalton: Yes, Sir.
    Sir G. Jeffreys: Is the Chancellor aware that this may be a great drawback to recruiting for the Territorial Army, and will he state whether it is proposed to levy this Income Tax by means of the P.A.Y.E. system, and, if so, who is to keep the accounts and who is to make the deductions?
    Mr. Dalton: We do not want, of course, to impose any drawback on recruitment, but, as a matter of fact, I think that the hon. and gallant Gentleman will find that expenses in this case, as in the case of civilian employment, are such as would naturally fall under the tax. We have been anxious not to discriminate in any way and, as I have said, I think that he will find that that is the arrangement. As to the method of payment, perhaps he will put down a Question, to which I will let him have an answer.

    Banks (Opening)
    Mr. Douglas Marshallasked the Chancellor of the Exchequer if he will consider instructing the banks to close temporarily on Saturdays to save fuel transport and eyesight.
    Mr. Dalton: No, Sir. The saving would be negligible, and there would be great inconvenience to the public.
    Lieut.-Commander Braithwaite: In view of the fact that paying-in at banks in variably takes place during the hours of the electricity restriction, would the right hon. Gentleman consider classifying banks as essential services?
    Mr. Dalton: I should have to think about that.

    Postwar Credits (Repayment Cost)
    Mr. W. J. Brownasked the Chancellor of the Exchequer whether he will expedite the payment of Income Tax postwar credits to elderly people and to those who have been forced to retire from active employment by ill-health.
    Colonel J. R. H. Hutchisonasked the Chancellor of the Exchequer what total of postwar credits has been paid up till 1st February, 1947.
    Mr. Dalton: Payments of Income Tax postwar credits for 1941–42, 1942–43 and 1943–44 have been made to men over the
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    age of 65, and women over 6o, during this last year. Some 1,700,000 people have been paid amounts totalling about £56,000,000. The hon. Member for Rugby (Mr. W. J. Brown) would not expect me to anticipate my Budget Statement.
    Mr. Brown: In view of the long delay in conferring the benefits of Socialism upon these old folk, might we not do our best to give them the refunds due to them from the outworn capitalist system?

    Motor Taxation
    Mr. Christopher Shawcrossasked the Chancellor of the Exchequer (1) whether he will substitute, in place of the present cubic capacity tax on private motor-cars, a flat rate tax of £5 per annum, per vehicle, with an increased tax on petrol;
    (2) what recommendations he has recently received from the Society of Motor Manufacturers and Traders, or from the Motor Advisory Council, concerning alteration of the present system of tax on private motor-cars; and if he will publish such recommendations.
    Mr. Dalton: My right hon. Friend the Minister of Supply has received a report from the National Advisory Council for the motor manufacturing industry which he has communicated to me and the other Ministers concerned. It is now under consideration. My hon. Friend will not, of course, expect me to anticipate my Budget Statement.
    Mr. Shawcross: Is my right hon. Friend aware that he is by far the best Chancellor of the Exchequer this country has ever had and, therefore, much more likely to introduce this much overdue reform than were any of his less capable predecessors?
    Mr. Edelman: Will my right hon. Friend bear in mind that the motor trade generally is in favour of the revised form of taxation mentioned by my hon. Friend?
    Mr. Dalton: I will promise to give the matter careful consideration, but it would be wrong for me to give any definite undertaking at the moment. I am a little embarrassed with the speed with which the spokesmen of the motor industry change their minds.
    Mr. Oliver Stanley: In his consideration, will the right hon. Gentleman pay more attention to the views of the motor industry than to the flattery of his hon. Friends?

    Taxicabs (Purchase Tax)
    Mr. Bossomasked the Chancellor of the Exchequer if he will consider removing Purchase Tax from taxicabs, which are now the only public conveyance so penalised.
    Mr. Dalton: My hon. Friend will not expect me to anticipate my Budget Statement.
    Mr. De la Bère: Could not the unexpected happen sometimes?

  CIVIL SERVICE

    Manpower
    Brigadier Mackesonasked the Chancellor of the Exchequer what steps he is taking to put a check on increases in the Civil Service.
    Mr. Dalton: I would refer the hon. and gallant Member to the reply given by my right hon. Friend the Financial Secretary to the hon. Member for Orpington (Sir W. Smithers) on 19th December, 1946.
    Brigadier Mackeson: Is the Chancellor aware that the only hope of stopping this appalling increase is to stop socialised control?
    Mr. Dalton: I am afraid that decentralised control often takes up even more personnel. We are watching the matter very closely.

    Disabled Ex-Servicemen (Dismissal)
    Mr. William Teelingasked the Chancellor of the Exchequer why disabled ex-Servicemen from this war, employed as civil servants, have to take their chance with other able-bodied civil servants for dismissal due to redundancy, when those from the 1914–18 war are the last to be dismissed; and why the agreement made in 1946 to employ only 3 per cent. Service disabled men in Government Departments was not brought before Parliament.
    Mr. Dalton: The order of discharge of redundant temporary civil servants is governed by a National Whitley Council
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    Agreement. This embodies the pledge in favour of the ex-Servicemen of the 1914–18 war, but disabled ex-Servicemen from the recent war are not discharged if this would bring the percentage of registered disabled persons in any Department below the figure of 3 per cent. laid down under the Disabled Persons (Employment) Act, 1944. 4.9 per cent. of Government staffs are registered disabled persons.
    Mr. Teeling: Can the right hon. Gentleman explain why, if the Disabled Persons (Employment) Act, 1944, definitely says that ex-Servicemen are to be given priority in employment, they should not be given priority to keep employment if there is any necessity for dismissals?
    Mr. Dalton: I think that that would be rather straining the word "priority" We are all very anxious that there should be a sufficient proportion of disabled men in Government employment, and, as I have indicated to the hon. Member, we arc at present, I am glad to say, well above the maximum.
    Mr. Manningham-Buller: Does the right hon. Gentleman apply the same principle as that applied by the Minister of Supply in the case of ex-Servicemen, that is to say, last in first out?
    Mr. Teeling: In View of the unsatisfactory nature of the reply to my Question, I beg to give notice that I propose to raise the matter on the Adjournment at the earliest possible moment.

  RAILWAY CLERKS (WAGE CLAIM)
  Mr. Osborneasked the Chancellor of the Exchequer if he is aware that the Railway Clerks' Association is now demanding a 35-hour week with £1 increase in wages; and what would be the effect of granting this concession upon the purchasing power of the£.
  Mr. Dalton: No such calculation can be made.
  Mr. Osborne: In view of the great need for increased output, would the right hon. Gentleman call the attention of the trade union leaders to the unpatriotic demand at the present time for a 35-hour week?
  Mr. Dalton: We must not cross the wires. That is a matter primarily for my

  979
  right hon. Friend the Minister of Labour. At the moment, of course, it is a hypothetical question.
  Mr. A. Edward Davies: Is the Minister aware that the unattractive conditions in the railway industry account for the large number of men leaving the service at a time when they are vitally necessary to the transport system and to the country?

  TRADE AND COMMERCE

    Football Pools (Paper)
    Mr. Nallyasked the President of the Board of Trade what action is now being taken by his Department to ensure that the undertaking given to him by certain football pool proprietors not to exceed 2½ per cent. of their prewar paper consumption is being observed; and how many of the existing football pool firms did not give such undertaking arid are not bound by it.
    The Parliamentary Secretary to the Board of Trade (Mr. Belcher): In reply to the first part of the Question, I would refer my hon. Friend to the reply given to him on 16th October last. As regards the second part, so far as paper consumption is concerned, we have no record of the number of pools in operation, but the undertaking is obtained from all pool promoters for whose requirements paper is licensed. In the case of promoters who do not obtain paper by way of licence, no such undertaking is obtained.
    Mr. Nally: Am I to assume from my hon. Friend's reply that, so far as the vast majority of football pool firms in this country are concerned, my hon. Friend's Department has no assurance whatsoever and no agreement of any kind to restrict the amount of paper they are able to purchase?
    Mr. Belcher: Yes, Sir. These small pools are not licensed to acquire paper and, therefore, they acquire it from merchants who supply it from their stocks. We have no information on the amount they have.
    Mr. Henry Strauss: Is it an intended or an unintended result of the Government's policy that football pools are now our most prosperous industry?

    South-West Ports (Traffic)
    Mr. Peter Freemanasked the President of the Board of Trade if he will publish a list showing the total imports and exports each year to and from Newport since 1932, divided into any convenient classification.
    The Secretary for Overseas Trade (Mr. Marquand): Details of trade into and out of Newport for 1932 and 1938 will be found in Volume IV of the Annual Statement of Trade of the United Kingdom for the years 1936 and 1938. Figures for the war years are not available, and those for 1946 have not yet been compiled.
    Mr. Freeman: Is it not a fact that these figures, when collected, would show a continuous decline over every one of these 15 years, and, in view of the fact that this port has every modern facility, does my hon. Friend not agree that steps should be taken to improve the position?
    Mr. Marquand: We are continually studying the problem of traffic in South-West ports, and we are doing all we can.

    Fuel Emergency (Production)
    Mr. Beechmanasked the President of the Board of Trade whether, in view of the loss of production arising from the shortage of coal and the resulting reduction in exports, he intends to cut down imports; and, if so, which and to what extent.
    Sir John Barlowasked the President of the Board of Trade whether, in view of the loss of production resulting from the shortage of coal, he intends to reduce goods for home consumption or export; and what adjustments, if any, he intends to make.
    Mr. Belcher: Until the loss of production can be a little more definitely assessed, it would be premature to say how our programmes will be affected.
    Mr. Beechman: Will the Minister ensure that the Government's import plans are made known to those engaged in agriculture as well as to those engaged in manufacturing, as soon as possible?
    Mr. Belcher: Of course, we shall give all the information we can as soon as we have the facts.
    Mr. Rhys Daviesasked the President of the Board of Trade whether.

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    until some power is discovered to supplant coal, he will regulate the economy of the country so that industry may fit in with the amount of coal produced rather than urge an expansion beyond the maximum amount of coal available.
    Mr. Belcher: Our aim must be to supply our full essential needs, whether from coal or from other sources of light and heat.
    Mr. Davies: Does it not seem reasonable, when the Board of Trade know full well the total amount of coal produced in this country, that they should relate that knowledge to their expenditure of coal in connection with manufacturing industries. instead of the other way round?

    Suspenders
    Mr. Garry Allighanasked the President of the Board of Trade whether he is aware that the shortage of women's stockings is worsened by the damage done to them by the metal and plastic fittings to suspenders; what is the total amount of rubber saved by using those materials; and whether he will facilitate the use of rubber instead.
    Mr. Belcher: The restrictions on the use of rubber in suspender fittings were withdrawn in November, 1945, but some manufacturers have been using their stocks of fittings of other types.
    Mr. Allighan: In view of the fact that the majority of the women who have spoken to me complain that the suspenders they get today destroy their stockings, will he take steps to ensure that rubber is made available for this purpose?
    Mr. Belcher: I am not so well informed as the hon. Gentleman about the views of the women, but I can assure him that, so far as the Government are concerned, there is no restriction at all, and if manufacturers want to use rubber we will not prevent them

    Sheets and Towels
    Mr. Boardmanasked the President of the Board of Trade whether, before the new clothing coupons become negotiable, he proposes to announce any change or concession in connection with the coupon-age of bed linen and towels.
    Mr. Belcher: No, Sir. The pointing of towels is already low and the range of
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    pointings for sheets, within the limits already announced, will be published shortly.

    North American Timber
    Mr. John E. Haireasked the President of the Board of Trade what additional quantities of timber have been obtained in North America as a result of the recent visit there of representatives of Timber Control.
    Mr. Marquand: Representatives of the limber Control are still in North America and their negotiations are not yet concluded. A full statement will be made as soon as possible.
    Mr. Haire: Can my hon. Friend assure the House that long-term purchases are being made as well as those to meet the present scarcity in the timber trade?
    Mr. Marquand: I would not care to make any statement at present. beyond what I have said.

    Printing Costs
    Mr. Osborneasked the President of the Board of Trade if he will give an estimate of the increase in printing costs which will result from the recently-granted rise in wages, reduction of hours and two weeks' holiday with pay; and to what extent does he anticipate a fall in production as a result of the shorter working week.
    Mr. Belcher: I regret that I cannot give any estimate of the rise in costs, but I am informed that there have been some increases which vary from section to section of the industry. I hope that there will be no reduction, but opinions differ within the industry and I should not tare to offer a prediction.
    Mr. Osborne: Could the hon. Gentleman say how far those increases range? He said they varied from section to section, but could he say approximately what percentage they represent?
    Mr. Belcher: I am afraid I cannot give that detailed information.

    New Factories
    Mr. Bossomasked the President of the Board of Trade if, in future, he will publish in the Government periodical "Statistical Digest" the complete list of all new factories giving their address and purpose and date of approval by both his Department and the Ministry of Health.
    Mr. Belcher: No, Sir.
    Mr. Bossom: Why not? Is it not desirable that this information should be given, stating also whether approval has been given by the Ministry of Town and Country Planning?
    Mr. Belcher: To publish a complete list of all the factories would entail an addition of 60 pages, which I do not think would be warranted. In any case, some of the information given by industrialists is of a confidential nature, and we should not publish it.
    Mr. Churchill: How many copies of this volume containing these 60 additional pages would it be necessary to print in order to give the information? Why should the names of new factories not be made public? What is the secrecy about it?
    Mr. Belcher: There is nothing secret about it at all, but at present there are 2,736 new factories, and to publish them in detail every month in the Statistical Digest would entail about 60 additional pages.
    Mr. Churchill: When we are asked to pass legislation in order to produce enormous census of production returns and details of all kinds in every direction, why should not these broad, simple, practical facts be made known?
    Mr. Belcher: I think I have already given the answer. We have no desire to use more paper than is necessary. This suggestion would entail the addition of 60 pages per month to the Statistical Digest in addition to which the information given by industrialists about the purpose of their factories is very often confidential. There is no reason why we should make it public.
    Mr. Churchill: Why could not the 60 pages containing information of new factories be published once, and then merely additions published weekly after that? What have the Government to hide in this matter?
    Mr. Belcher: Nothing at all. The Government have every reason to be proud of what they are doing, but I will consider the right hon. Gentleman's suggestion.
    Lieut.-Commander Braithwaite: Are any of the factories working?
    Mr. Churchill: May I suggest that the hon. Gentleman should jettison some of this exceptional modesty, and let us have the simple facts for which we ask?
    Mr. Belcher: I am always prepared to consider any suggestion of the right hon. Gentleman.
    Major Bruce: Does my hon. Friend not agree that had he followed of his own accord the course suggested by the Opposition, he would have been accused by the Opposition of extravagance?
    Mr. John Lewis: Will my hon. Friend consider publishing the figures in the "Board of Trade Journal"? Does he not think this information might be useful in assessing industrial activities, particularly in special areas?
    Major Guy Lloyd: The hon. Gentleman said that the Government have every reason to be proud of what they are doing, but is it not a fact that it is the industrialists who are doing it?
    Mr. Churchill: Am I right in assuming, at the end of this colloquy, that the Minister is going to consider—[Horn. MEMBERS: "No."]—yes, he said so. Is he going to consider the giving of this simple information?
    Mr. Belcher: If it is possible to give this information in a convenient and simple form, I will consider it.
    Mr. Churchill: Thank you very much.
    Colonel Gomme-Duncan: Is it not a fact that the publication of these figures would be extremely embarrassing for the hon. Gentleman's colleague the Secretary of State for Scotland?
    Mr. Belcher: Quite the contrary.

BUSINESS OF THE HOUSE
Mr. Eden: May I ask the acting Leader of the House if he can tell us for what purpose he wishes to suspend the Rule today; and also if he can tell us of any alteration for Thursday's Business?
The Lord Privy Seal (Mr. Arthur Greenwood): It is proposed to suspend the Rule today in order that we may make

985
good progress—I emphasise good progress—with the Supplementary Estimates on the Order Paper; but we do not intend to keep the House sitting late tonight. As the House is aware, there are other Supplementary Estimates down on the Order Paper for consideration tomorrow. It is our hope that within the two days, today and tomorrow, we shall be able to complete the Committee stage of the outstanding Votes.
As regards further Business this week, in view of our consideration for hon. Members we did not get the Third Reading of the Civic Restaurants Bill yesterday. We therefore propose to take the Third Reading of that Bill on Thursday as the first Order, and then to proceed with the Orders on the Paper in the order in which they were down originally.
Mr. Eden: With regard to the Supplementary Estimates, while I understand the right hon. Gentleman expresses that hope, I am sure he understands there cannot be any undertaking from this side of the House to be able to finish so large a programme by tomorrow night.
Mr. Greenwood: On previous occasions I have made the same kind of statement myself. But if we do not make further reasonable progress today—and I stand by what I said, that we will not sit unduly late—I may have to move the suspension of the Rule tomorrow, and we may have to sit late. I hope that will not happen.

PALESTINE CONFERENCE (GOVERNMENT POLICY)
The Secretary of State for Foreign Affairs (Mr. Bevin): Sir, I am very sorry to have to inform the House that the Conference with the Arabs and the consultations with the Zionist Organisation about the future of Palestine which have been proceeding in London have come to an end because it has become clear that there is no prospect of reaching by those means any settlement which would be even broadly acceptable to the two communities in Palestine. Ever since they took office the Government have laboured incessantly to find a solution of the Palestine problem. Most Members on this side of the House believed that no solution was to be found along the lines of the White Paper of 1939; and the Government therefore addressed themselves at once to the task
986
of devising a different approach on which they could negotiate with the parties concerned. In view of the keen interest shown by American Jewry in the aspirations of Zionism, it was thought desirable that the Government of the United States should be associated with this endeavour; and as a result the Anglo-American Committee of Inquiry was appointed in November, 1945. At the same time it was decided that Jewish immigration into Palestine should be temporarily continued at the rate of 1,500 a month notwithstanding the limit set by the White Paper, and an additional 21,000 Jews have been admitted since the White Paper terminated; and since July, 1945, 29,000 have been admitted.
When the Report of the Anglo-American Committee was received, we agreed with the United States, Government that it should be examined by British and American officials. They jointly recommended the plan of Provincial Autonomy which was described in this House by my right hon. Friend the Lord President of the Council on 31st July, 1946. This plan gave a basis for negotiation with the parties concerned; and no time was lost in inviting them to confer with us. Neither of the two communities in Palestine accepted this invitation, but a conference with representatives of the Arab States was opened in London in September of last year. After an adjournment, due to the meeting of the General Assembly of the United Nations, the Conference was resumed in January, the Palestine Arabs then joined in the discussions. The Jewish Agency have throughout refused to participate in the Conference, although informed that all proposals would be open for discussion, but it has been possible in this last phase to have conversations on an informal basis with representatives of the Agency.
From the outset, both Arabs and Jews declined to accept as a basis for discussion the provincial autonomy plan put forward by His Majesty's Government. The Arabs put forward an alternative proposal, under which Palestine would achieve early independence as a unitary State with a permanent Arab majority. His Majesty's Government, seeing no prospect of negotiating a settlement on that basis, put forward new proposals of their own. These envisaged the establishment of local areas, Arab and Jewish, with a substantial degree of autonomy

987
within a unitary State, with a central government in which both Arabs and Jews would share. These proposals provided that Jewish immigrants should be admitted over the next two years at the rate of 4,000 a month, and that thereafter the continuation of the rate of Jewish immigration should be determined, with due regard to economic absorptive capacity, by the High Commissioner in consultation with his advisory council, or, in the event of disagreement, by an arbitration tribunal appointed by the United Nations. This plan, while consistent with the principles of the Mandate, added an element which has hitherto been lacking in our administration of Palestine, namely, a practical promise of evolution towards independence by building up, during a five year period of trusteeship, political institutions rooted in the lives of the people. It was offered as a basis of discussion. These three solutions have already been made known in broad outline, and we intend to lay before the House later in the week a White Paper describing each of them in greater detail.
The latest proposals of His Majesty's Government were rejected outright by both the Arab delegations and the representatives of the Jewish Agency, even as a basis for discussion. I think it important that the House should understand clearly the reasons which prompted the two sides to reject this solution. For the Arabs, the fundamental point is that Palestine should no longer be denied the independence which has now been attained by every other Arab State; and that, in accordance with the accepted principles of democracy, the elected majority should be free to determine the future destiny of the country. They regard the further expansion of the Jewish National Home as jeopardising the attainment of national independence by the Arabs of Palestine, which all Arab States desire; and they are therefore unwilling to contemplate further Jewish immigration into Palestine. They are equally opposed to the creation of a Jewish State in any part of Palestine.
The Jewish Agency, on the other hand, have made it clear that their fundamental aim is the creation of an independent Jewish State in Palestine. With this in view they first proposed that His Majesty's Government should continue to administer the mandate on a basis which would enable them to continue to expand the
988
Jewish National Home until such time as they had attained by immigration a numerical majority in Palestine and could demand the creation of an independent Jewish State over the country as a whole. When it was made clear, that His Majesty's Government were unable to maintain in Palestine a mandatory administration under the protection of which such a policy could be carried out, the representatives of the Jewish Agency indicated that, while still maintaining the justice of their lull claim, they would be prepared to consider, as a compromise, the proposal for the creation of "a viable Jewish State in an adequate area of Palestine." While they were not themselves willing to propose a plan of partition, they were prepared to consider such a proposal if advanced by His Majesty's Government.
His Majesty's Government have thus been faced with an irreconcilable conflict of principles. There are in Palestine about 1,200,000 Arabs and 600,000 Jews. For the Jews the essential point of principle is the creation of a sovereign Jewish State. For the Arabs, the essential point of principle is to resist to the last the establishment of Jewish sovereignty in any part of Palestine. The discussions of the last month have quite clearly shown that there is no prospect of resolving this conflict by any settlement negotiated between the parties. But if the conflict has to be resolved by arbitrary decision, that is not a decision which His Majesty's Government are empowered as Mandatory to take.
His Majesty's Government have of themselves no power, under the terms of the Mandate, to award the country either to the Arabs or to the Jews, or even to partition it between them. It is in these circumstances that we have decided that we are unable to accept the scheme put forward either by the Arabs or by the Jews, or to impose ourselves a solution of our own. We have, therefore, reached the conclusion that the only course now open to us is to submit the problem to the judgment of the United Nations. We intend to place before them an historical account of the way in which His Majesty's Government have discharged their trust in Palestine over the last 25 years. We shall explain that the Mandate has proved to be unworkable in practice, and that the obligations undertaken to the two com-

989
munities in Palestine have been shown to be irreconcilable. We shall describe the various proposals which have been put forward for dealing with the situation, namely, the Arab Plan, the Zionists' aspirations, so far as we have been able to ascertain them, the proposals of the Anglo-American Committee, and the various proposals which we ourselves have put forward. We shall then ask the United Nations to consider our report, and to recommend a settlement of the problem. We do not intend ourselves to recommend any particular solution.
Though we shall give immediate notice of our intentions, we see great difficulty in having this matter considered by the United Nations before the next regular session of fthe General Assembly in September. We regret that the final settlement should be subject to this further delay, particularly in view of the continuing strain on the British Administration and Services during this further period. We trust, however, that as the question is now to be referred to the United Nations all concerned will exercise restraint until their judgment is known.
Mr. Churchill: Are we to understand that we are to go on bearing the whole of this burden, with no solution to offer, no guidance to give—the whole of this burden of maintaining law and order in Palestine, and carrying on the administration, not only until September, which is a long way from February, not only until then, when the United Nations are to have it laid before them, but until those United Nations have solved the problem, to which the right hon. Gentleman has declared himself, after 18 months of protracted delay, incapable of offering any solution? How does he justify keeping 100,000 British soldiers in Palestine, who are needed here, and spending £30 million to £40 million a year from our diminishing resources upon this vast apparatus of protraction and delay?
Mr. Bevin: I very much regret this rhetorical display about protracted delay; because, if any two men, the ex-Colonial Secretary, now the First Lord, and I, have devoted, in the middle of a world crumbling to disaster from the war, efforts to solve this one problem, we have. I think for any hon. Member or right hon. Member to accuse us of protracted delay in trying to grapple with this problem, is totally unjust. The problem raised by
990
the right hon. Gentleman is a matter which has got to be considered So far as I can see from the constitution of the United Nations, it is rather difficult to get procedure other than that of the Assembly. But we have not communicated with them yet. There may be preliminary work that may be done; there may be improvised action, or something. But I assure the House we are not going to neglect it. I have a feeling that both the Jews and the Arabs, if they want to maintain dignity in their case, should be careful of their actions during this interim period. So far as immigration is concerned, at least 1,500 a month will go on. I have made that perfectly clear.
Mr. Boyd-Carpenter: At least 1,500?
Mr. Bevin: Fifteen hundred a month will go.
Mr. Boyd-Carpenter: Or more?
Mr. Bevin: I beg pardon. I understand the point now. Fifteen hundred, guaranteed during the interim period, will continue to go in.
Mr. Keeling: No more?
Mr. Bevin: I do riot understand. At the moment I commit myself to the 1,500 a month, nothing further, nothing less. I cannot give any other pledge. I do not think the Government have done badly, with, since the end of the war, 29,000 Jews transported. I realise the difficulties in Europe. I think neither the country nor the world realises what we have done in admitting those people. I still want to make one further appeal to other countries in the world—to the United States of America and to everybody else—to help us with these displaced persons.
Mr. Churchill: No one would suggest that the right hon. Gentleman does not give his full attention and strength to the discharge of his extremely complicated and painful duty. We all bear witness to the exhaustive efforts he has made, and to speak of delay is in no sense a reflection on his personal devotion to duty. But I am entitled to ask the question whether what has been announced today does not mean that at least a year will pass, while the British Government remain, on their own confession, without any solution of the Palestine problem, before any solution is provided from another quarter; and

991
whether that is not exposing us to an unduly heavy burden, both in the absorption of our manpower, and in the further depletion of our financial resources? If this policy is right today—and this is another question I wish to ask—why could it not have been announced 12 months ago?
Mr. Stokes: Would not the situation have been greatly simplified if the right hon. Gentleman the Member for Woodford (Mr. Churchill) had stuck to his own White Paper of 1922?
Mr. Bevin: I think that the hon. Member for Ipswich (Mr. Stokes) and the right hon. Gentleman the Member for Woodford could provide us with a very gay time. I think it would be a fatal policy for Great Britain, with all the leadership she has shown in the world and all her history, to have gone to the United Nations without attempting to exhaust every possibility. After all, the right hon. Gentleman was, I believe, in office, and he had a hand in this business right at the end of the last war, in the Lloyd George Coalition; and other hon. Members opposite have also had a hand in the administration of this great problem. Let me say this: I know the cost and I know the difficulties, but if we handle this well at the United Nations and exercise care, and if in the end the problem of the Jews and Arabs can, in some way, be settled after 2,000 years of conflict, 12 months will not be a long delay.
Mr. Churchill: Perhaps I may be permitted, by way of personal explanation, as the hon. Gentleman opposite has made a statement, to say that I had nothing to do with that White Paper—
Mr. Stokes: The White Paper of 1922.
Mr. Churchill: It is quite true. I stand entirely by the White Paper of 1922. I am entirely opposed to the other White Paper which was issued before the war, and always have been. May I ask when an opportunity will be given to Debate this difficult and entangled problem?
Mr. Bevin: I understand that question will be dealt with through the usual channels, and that an opportunity will be given.
Mr. Janner: Pending the remitting of this question to the United Nations, are we to understand that the Mandate stands. and that we shall deal with the situation of immigration and land restrictions on the basis of the terms of the Mandate, and that the White Paper of 1939 will be abolished?
Mr. Bevin: No, Sir. We have not found a substitute yet for that White Paper, and up to the moment, whether it is right or wrong, the House is committed to it. That is the legal position. We did, by arrangement and agreement, extend the period of immigration which would have terminated in December, 1945. Whether there will be any further change, my right hon. Friend the Colonial Secretary, who, of course, is responsible for the administration of the policy, will be considering later.
Mr. Oliver Stanley: In order to be correct, it is not a fact that the right hon. Gentleman extended the period? The period lapsed during the time of the Coalition Government and it was extended by them. I think that the right hon. Gentleman meant to say that he had added to the numbers.
Mr. Bevin: No, Sir. I stand to be corrected, but I understand that the White Paper came to an end on 31st December, 1945, and one of my first duties as Foreign Secretary was to take the whole thing up, about continuing immigration, with the Arabs and with the Arab States at that time. [An HON. MEMBER: "What was the number?"] The number was 75,000. I am really saying the same thing. Perhaps the right hon. Gentleman has forgotten that he was out of office at that time.
Mr. Stanley: The right hon. Gentleman should, at least, be accurate. What happened was that there were two things in the White Paper. There was the number, the 75,000, and the time they had to be in; after which it stopped. The time ran out while I was Colonial Secretary, and it was extended by the Coalition Government. The number ran out in 1945, and was extended by the Foreign Secretary
Mrs. Ayrton Gould: Are we to understand from my right hon. Friend that nothing is going to be done, during the period between now and the decision of the United Nations, to enable the moderate Jewish majority to control the minority? Is he aware that if the present

993
circumstances continue, it is inevitable that there will be an appalling amount of terrorist activity in Palestine?
Mr. Speaker: We seem to be getting now to the stage of debating Palestine.
Mr. Gallacher: Are we to take it from the statement that after 30 years' delay the Balfour Declaration is recognised to be utterly unrealistic?
Mr. Speaker: That is another of these debating questions.
Mr. Wilson Harris: On the question of procedure, are we to understand that this question is to go to the United Nations under the head of "trusteeship"? is there any reason why it should not go to the Security Council as a matter endangering international peace? It certainly does that, much more than the Spanish situation of which the Security Council took cognizance.
Mr. Bevin: When the League of Nations was wound up, there was a guarantee by the Mandatory Powers that they would carry on their Mandates and treat the United Nations as if they were the League of Nations. Therefore, I have to have regard to that. I do not think it is endangering the security of the world, and I do not think, personally, it is a Security Council matter. I am aware that Spain and other things went to the Security Council, but it was rather a new toy that. year.
Mr. Pickthorn: I would not for the world ask an argumentative question at this stage, but I should like to ask whether, with due respect for our normal protocol, we might not ask the acting Leader of the House to let us know now, when and where, and in what form, we are to debate this question so that we can keep our argumentative questions till then? Can we know that now?
Mr. Greenwood: This disorderly practice of people asking in advance of Thursday—
Mr. Churchill: On a point of Order. Has the acting Leader of the House any right to suggest that you, Sir, have countenanced disorderly practice?
Mr. Speaker: I did not understand the right hon. Gentleman to say that.
Mr. Greenwood: I meant to say, "tendency,'' Sir. I do not see why I should be challenged about this, because on two occasions I have said that at the earliest opportunity this subject should be debated. This is Tuesday, and I object to Members asking me, on a Tuesday, to state Business which would normally announced on a Thursday. I can assure tile House that a Debate will be held fairly early next week, but discussion have to go on, through the usual channels, about the alteration of Business for next week.
Mr. Sydney Silverman: Will the Foreign Secretary bear in mind that the House generally will be appreciative of the careful attempt he has made to state the conflicting views of the two sides? Further, will he say whether—in view of His Majesty's Government's experience over so many years—in arriving at that conclusion, there does not lie a moral responsibility on the Government to offer some advice to the United Nations, instead of merely flinging this problem at their heads without offering any suggestions?
Mr. Bevin: We have carefully studied this matter, and put forward proposal after proposal. They are there, and I personally do not think that we can offer to the United Nations any more proposals. We shall leave them on the table. They, in turn, may have better ones, but this is the best we can do.

NEW MEMBER SWORN
George Oscar Sylvester, Esquire, for toe County of York, West Riding (Normanton Division).
BUSINESS OF THE HOUSE
Motion made, and Question put,
"That the proceedings on Government Business be exempted at this day's Sitting. front the provisions of the Standing Order (Sittings of the House)."—[Mr. Arthur Greenwood.]
The House divided:
The Tellers being come to the Table, the figures were announced as: Ayes, 296; Noes, 141.

Division No. 84.]

AYES

[4.02 p.m.

Adams, Richard (Balham)

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

Irving, W. J.

Alexander, Rt. Hon. A. V

Davies, R. J. (Westhoughton)

Isaacs, Rt. Hon. G. A

Allen, A. C. (Bosworth)

Deer, G.

Janner, B.

Allighan, Garry

Delargy, Captain H. J

Jay, D. P. T.

Alpass, J. H.

Dobbie, W.

Jeger, G. (Winchester)

Anderson, A. (Motherwell)

Dodds, N. N.

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

Anderson, F. (Whitehaven)

Donovan, T.

Jones, D. T. (Hartlepools)

Attewell, H. C

Driberg, T. E. N.

Jones, Elwyn (Plaistow)

Attlee, Rt. Hon. C R

Dugdale, J. (W. Bromwich)

Keenan, W.

Austin, H. L.

Dumpleton, C. W.

Kendall, W. D.

Awbery, S. S.

Dye, S.

Kenyon, C.

Ayles, W. H.

Ede, Rt. Hon. J. C.

King, E. M.

Ayrton Gould, Mrs. B

Edelman, M.

Kinghorn, Sqn.-Ldr E.

Bacon, Miss A

Edwards, A. (Middlesbrough, E.)

Kinlay, J.

Balfour, A.

Edwards, W. J. (Whitechapel)

Kirby, B. V.

Barton, C.

Evans, E. (Lowestoft)

Kirkwood, D.

Battley, J. R.

Evans, S. N. (Wednesbury)

Lang, G.

Bechervaise, A E.

Evans, John (Ogmore)

Lavers, S.

Belcher, J W.

Ewart, R.

Lee, F. (Hulme)

Bellenger, Rt. Hon. F J.

Fairhurst, F.

Lee, Miss J. (Cannock)

Benson, G

Fletcher. E G M (Islington. E.)

Levy, B. W.

Berry, H.

Follick, M.

Lewis, J. (Bolton)

Beswick, F

Foot, M. M.

Lindgren,. G. S.

Bevin, Rt Hon. E (Wandsworth. C.)

Forman, J. C.

Lipton, Lt.-Col. M

Bing, G. H C.

Foster, W. (Wigan)

Logan, D. G.

Binns, J.

Fraser, T. (Hamilton)

Longden, F.

Blackburn, A. R.

Freeman, Maj. J. (Watford)

Lyne, A. W.

Blenkinsop. A.

Freeman, Peter (Newport)

McAllister, G

Blyton W. R.

Gallacher, W.

McEntee, V. La T

Boardman, H.

George, Lady M Lloyd (Anglesey.)

McGhee, H. G.

Bowen, R.

Gibbins, J.

McGovern, J.

Bowles, F. G. (Nuneaton)

Gibson, C. W.

Mack, J. D.

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

Gilzean, A.

McKay, J (Wallsend)

Braddock, T. (Mitcham)

Glanville, J E. (Consett)

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

Bramall, Major E. A.

Goodrich, H. E.

Maclean, N. (Govan)

Brook, D. (Halifax)

Granville, E. (Eye)

McLeavy, F

Brooks, T. J. (Rothwell)

Greenwood, Rt. Hon. A. (Wakefield.)

McMillan, M. K. (Western Isles)

Brown, George (Belper)

Greenwood, A. W. J (Heywood)

Mallalieu, J. P. W.

Brown, T. J. (Ince)

Grenfell, D. R.

Mann, Mrs. J.

Bruce, Major D. W. T

Grey. C. F.

Manning, C. (Camberwell, N.)

Buchanan, G.

Grierson, E.

Manning, Mrs. L. (Epping)

Burden, T. W.

Griffiths, Rt. Hon. J (Llanelly)

Marquand, H. A.

Burke, W. A.

Gunter, R. J

Marshall, F. (Brightside)

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

Guy, W. H.

Mathers, G.

Castle, Mrs. B. A.

Haire, John E (Wycombe)

Mayhew, C. P.

Chamberlain. R. A

Hale, Leslie

Medland, H. M.

Champion, A. J.

Hall, W. G.

Middleton, Mrs. L.

Chater, D.

Hamilton, Lieut.-Col. R

Mikardo, Ian

Chetwynd, G. R.

Hannan, W. (Maryhill)

Mitchison, Maj. G. R

Clitherow, Dr. R.

Hardy, E. A.

Monslow, W.

Cocks, F. S.

Harris, H. Wilson

Montague, F.

Coldrick, W.

Harrison, J.

Moody, A. S

Collindridge, F.

Hastings, Dr. Somerville

Morris, P. (Swansea, W.)

Colman, Miss G. M

Henderson, A. (Kingswinford)

Morris, Hopkin (Carmarthen)

Comyns, Dr. L

Henderson, Joseph (Ardwick)

Mort, D. L

Cook, T. F.

Herbison, Miss M.

Moyle,

Corlett, Dr. J.

Hewitson, Capt. M

Mulvey, A

Corvedale, Viscount

Hicks, G.

Murray, J. D

Crawley, A.

Holman, P.

Nally, W

Crossman, R. H S.

Holmes, H. E. (Hemsworth)

Naylor, T. E

Daggar, G

House, G

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

Daines, P.

Hoy, J.

Nicholls, H. R. (Stratford)

Dalton, Rt. Hon. H.

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

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

Davies, Clement (Montgomery)

Hughes, Hector (Aberdeen, N.)

Noel-Baker, Rt. Hon. P. J. (Derby)

Davies, Edward (Burslem)

Hughes, H. D. (Wolverhampton, W.)

Noel-Buxton, Lady

Davies, Ernest (Enfield)

Hutchinson, H. L. (Rusholme)

Oldfield, W. H

Davies, Harold (Leek)

Hynd, H. (Hackney C.)

Oliver, G. H.

Silverman, S.S (Nelson)

Usborne, Henry

Orbach, M.

Skeffington-Lodge, T. C.

Vernon, Maj. W. F

Paling, Rt. Hon. Wilfred (Wentworth)

Skinnard, F. W.

Viant, S. P.

Paling, Will T. (Dewsbury)

Smith, Ellis (Stoke)

Walkden, E

Palmer, A M F.

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

Walker, G. H

Parkin, B. T.

Solley, L. J.

Wallace, G. D. (Chislehurst)

Paton, Mrs. F. (Rushcliffe)

Sorensen, R. W.

Wallace, H. W (Walthamstow, E.)

Paton, J. (Norwich)

Soskice, Maj. Sir F.

Warbey, W. N.

Pearson, A.

Sparks, J. A.

Watkins, T E

Pearl, Capt. T. F.

Stamford, W

Watson, W. M.

Poole, Major Cecil (Lichfield)

Stephen, C.

Webb, M. (Bradford, C.)

Popplewell, E.

Stewart, Capt. Michael (Fulham, E.)

Weitzman, D.

Porter, E. (Warrington)

Stokes, R. R.

Wells, P L. (Faversham)

Price, M. Philips

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

West, D G.

Proctor, W. T.

Stross, Dr. B

White, C. F (Derbyshire, W.)

Randall, H. E.

Stubbs, A. E.

Whiteley, Rt. Hon. W.

Ranger, J.

Summerskill, Dr. Edith

Wilcock, Group-Caps C A B

Rees-Williams, D. R.

Swingler, S

Wilkes, L.

Reeves, J.

Sylvester, G. O.

Wilkins, W. A

Reid, T. (Swindon)

Symonds, A L.

Willey, F T (Sunderland)

Ridealgh, Mrs. M.

Taylor, H. B. (Mansfield)

Willey, O. G. (Cleveland)

Robens, A

Taylor, R. J. (Morpeth)

Williams, J. L (Kelvingrove)

Roberts, Goronwy (Caernarvonshire)

Taylor, Dr. S. (Barnet)

Williams, W R. (Heston)

Roberts, W. (Cumberland, N.)

Thomas, D. E (Aberdare)

Willis, E.

Ross, William (Kilmarnock)

Thomas, I. O (Wrekin)

Wise, Major F J

Royle, C.

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

Woods, G S.

Sargood, R.

Thorneycroft, Harry (Clayton)

Wyatt, W.

Scott-Elliot, W.

Thurtle, E

Yates, V. F.

Segal, Dr. S.

Tiffany, S.

Young, Sir R (Newton)

Shackleton, Wing-Cam. E. A. A.

Timmons, J.

Younger, Hon. Kenneth

Sharp, Granville

Titterington, M F

Shawcross, C. N. (Widnes)

Tolley, L.

TELLERS FOR THE AYES

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

Turner-Samuels, M

Mr. Snow and Mr. Simmons

NOES

Agnew, Cmdr. P. G.

Hinchingbrooke, Viscount

Orr-Ewing, I L

Assheton, Rt. Hon. R

Hollis, M. C.

Osborne, C.

Astor, Hon. M.

Howard, Hon. A

Peake, Rt. Hon. O.

Beechman, N. A.

Hurd, A.

Peto, Brig C H. M

Birch, Nigel

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

Pickthorn, K.

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

Jarvis, Sir J

Poole, O. B. S. (Oswestry)

Boothby, R.

Jeffreys, General Sir G.

Prior-Palmer, Brig. O.

Bossom, A. C.

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

Raikes, H. V.

Bower, N.

Keeling, E. H

Rayner, Brig. R

Boyd-Carpenter, J. A.

Kerr, Sir J. Graham

Reed, Sir S (Aylesbury)

Braithwaite, Lt.-Comdr. J. G.

Lambert, Hon G.

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

Bromley-Davenport, Lt-Col. W.

Lancaster, Col. C. G

Ropner, Col. L.

Buchan-Hepburn, P. G T

Langford-Holt, J.

Ross, Sir R.

Bullock, Capt. M.

Law, Rt. Hon. R. K.

Sanderson, Sir F

Butcher, H. W.

Legge-Bourke, Maj. E. A. H

Scott, Lord W.

Challen, C.

Lindsay, M (Solihull)

Shephard, S (Newark)

Channon, H.

Linstead, H. N

Shepherd, W. S. (Bucklow)

Churchill, Rt. Hon. W. S

Lloyd, Maj. Guy (Renfrew, E.)

Smithers, Sir W.

Clarke, Col. R S.

Low, Brig A. R. W.

Snadden, W M.

Clifton-Brown, Lt.-Col. G

Lucas, Major Sir J.

Spence, H. R.

Cooper-Key, E M.

Lucas-Tooth, Sir H.

Stanley, Rt. Hon O.

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

MacAndrew, Col, Sir C

Stoddart-Scott, Col. M.

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

McCallum, Maj. D.

Strauss, H G. (English Universities)

Crosthwaite-Eyre, Col. O. E.

MacDonald, Sir M. (Inverness)

Stuart, Rt. Hon. J. (Moray)

Crowder, Copt J. F. E

Macdonald, Sir P. (Isle of Wight)

Studholme, H G

Cuthbert, W. N.

Mackeson, Brig. H. R.

Sutcliffe, H.

Darling, Sir W. Y.

McKie, J. H. (Galloway)

Taylor, C S. (Eastbourne)

De la Bère, R.

Maclay, Hon. J. S

Taylor, Vice-Adm. E. A. (P'dd'ton, S.)

Dlgby, Maj. S W.

MacLeod, Capt. J.

Teeling, William

Dodds-Parker, A. D.

Macpherson, Maj. N. (Dumfries)

Thomas, J P. L. (Hereford)

Drewe, C.

Maitland, Comdr. J. W.

Thorneycroft, G. E. P (Monmouth)

Eden, Rt Hon. A

Manningham, Buller, R. E

Thornton-Kemsley, C. N

Elliot, Rt. Hon. W. E

Marlowe, A. A. H

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

Erroll, F. J.

Marples, A, E.

Touche, G C.

Fletcher, W. (Bury)

Marsden, Capt. A.

Vane, W. M. F.

Foster, J. G. (Northwich)

Marshall, D. (Bodmin)

Walker-Smith, D.

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

Marshall, S. H. (Sutton)

Ward, Hon. G R.

Fraser, Sir I. (Lonsdale)

Medlicott. F

Watt, Sir G. S. Harvie

Gage, C.

Mellor, Sir J

Wheatley, Colonel M. J.

Galbraith, Cmdr. T. D

Malson, A. H. E.

White, Sir D (Fareham)

Gammans, L. D.

Moore, Lt.-Col. Sir T.

While, J. B (Canterbury)

George, Maj. Rt. Hn. G Lloyd (P'ke)

Morrison, Maj. J. G. (Salisbury)

Williams, C. (Torquay)

Glyn, Sir R.

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

Williams, Gerald (Tonbridge)

Gomme-Duncan, Col. A G

Mott. Radclyfle, Maj. C. E.

Willoughby de Eresby, Lord

Grant, Lady

Neven-Spence, Sir B.

York, C.

Gridley, Sir A.

Nicholson, G.

Young, Sir A S. L. (Partick)

Grimston, R. V.

Noble, Comdr. A. H. P.

TELLERS FOR THE NOES

Hare. Hon. J. H. (Woodbridge)

Nutting, Anthony

Major Ramsay and

Henderson, John (Catheart)

O'Neill, Rt. Hon. Sir H.

Major Conant.

Question put, and agreed to

Mr. Simmons: I have to report, Mr. Speaker, that two names should be added to the figures of the "Noes." This has been agreed. They are Mr. Buchan-Hepburn and Sir Hugh Lucas-Tooth
Mr. Speaker: If both parties are agreed, then, of course, there are two to be added to the "Noes." The figures therefore are: Ayes, 296: Noes, 143

ORDERS OF THE DAY

  SUPPLY
  Considered in Committee.
  [Major MILNER in the Chair]

  SUPPLY

    NAVY SUPPLEMENTARY ESTIMATE. 1946–47
    Motion made, and Question proposed,
    "That a Supplementary sum, not exceeding £20,000,000, 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 expenditure beyond the sum already provided in the grants for Navy Services for the year."

    Schedule.

    Sums not exceeding

    Supply Grants.

    Appropriations in Aid

    Vote.

    £

    £

    1. Wages, &c. of Officers and Men of the Royal Navy land Royal Marines and Women's Royal Naval Service

    14,750,000

    —

    2. Victualling and Clothing for the Navy

    950,000

    —

    3. Medical Establishments and Services

    380,000

    —

    4. Civilians employed on Fleet Services

    1,800,000

    —

    5. Educational Services

    50,000

    —

    6. Scientific Services

    Cr 1,050,000

    150,000

    7. Roual Naval Reserves

    Cr 100,000

    —

    8. Shipbuilding, Repairs, Maintenance &c—

    Section I—Personnel

    4,250,000

    250,000

    9. Naval Armaments

    1,500,000

    —

    10. Works, Buildings and Repairs at Home and Abroad

    Cr 1,150,000

    —

    11. Miscellaneous Effective Services

    6,350,000

    350,000

    12. Admiralty Office

    800,000

    —

    13. Non-effective Services (Naval and Marine)—Officers

    130,000

    —

    14. Non-effective Services (Naval and Marine)—Men

    Cr 300,000

    —

    Sums not exceeding

    Supply Grants.

    Appropriations in Aid

    Vote.

    £

    £

    15. Civil Superannuation, Allowances and Gratuities

    430,000

    —

    16. Merchant Shipbulding, &c.

    Cr 1,6000,000

    400,000

    Total, Navy (Supplementary), 1946–47 £

    20,000,000

    18,000,000

    4.18 p.m.
    Vice-Admiral Taylor: While I see that there is an increase in expenditure of some £3 million I would like to ask whether included in that expenditure is the pay of R.N.R. and R.N.V.R. officers and men. On Vote 7 there is a decrease of £50,000 for the R.N.R. and £50,000 for the R.N.V.R. Therefore I hope that I am right in assuming that the increase of £3 million means that there is a compensating increase in the amount for the services carried out by the R.N.R. and R.N.V.R. at sea in His Majesty's ships. Under this Vote if they are serving in His Majesty's Navy they are accountable under Vote A. It is very important that there should not be any reduction in the strength of the R.N.R. or R.N.V.R. services and the training which they are given in His Majesty's Navy. It is common knowledge to every hon. Member in this House how immensely dependent we were on the services of the R.N.R. and R.N.V.R. especially during the late war. There were I think over 6o per cent. of the personnel represented by those Services. It is also common knowledge of the services which they rendered in all classes of ships and in command of many of them. They have approved their efficiency and ability by their services in the late war. It is essential that we should in the future be able to rely on the numbers and efficiency of these two Services. In wartime we relied increasingly on the naval reserves. After every war there is a reduction in the expenditure on the Armed Forces of the Crown. After the First World War. We carried that to such an extent that—
    The Chairman: I am sorry to interrupt the hon. and gallant Member, but he is not entitled to speak of decreases but only of increased costs.
    Vice-Admiral Taylor: I apologise for getting out of Order. I was merely endeavouring to show the necessity that existed for maintaining these reserve Services, because they are vital to the efficiency of His Majesty's Navy in wartime. That is why I have raised this matter of the Naval Reserve, and I should like to have some assurance that their strength and training will be maintained.
    Mr. J. P. L. Thomas: I did not wish to interrupt the hon. and gallant Gentleman the Member for South Paddington (Vice-Admiral Taylor), but I should now like to ask, if the Financial Secretary to the Admiralty is not going to say a few words by way of introducing this Vote and add something to the explanation in the Vote itself. I do not know what his intentions are, and perhaps he will now make them clear to the House.
    The Parliamentary and Financial Secretary to the Admiralty (Mr. John Dugdale): I intended to reply to the questions raised, rather than make two speeches.
    Commander Maitland: The question with which all of us are concerned is why there are so many men on the books of the Navy, why there are so few at sea and why the barracks are so full. If the Parliamentary and Financial Secretary can give a reply to that question, I assure him he will be serving a most useful purpose and helping the Committee on what is a burning question. Strictly on the Estimates, I only want to put two very brief questions. I am interested to know why it has been found necessary to find more money for the Royal Naval College at Dartmouth. I should have thought it would have been possible to estimate accurately for that institution, and I should be most interested if the hon. Gentleman could tell us, in some detail, how it is that more has been spent than was estimated and on what it has been spent.
    I next turn to Section III, A, of Vote 8, "Ships: Hulls, Machinery, Armour, Gunmountings and equipment." The big item, of course, is machinery for the Navy. At the same time, I see that the appropriations in aid have depreciated very considerably, and I wonder whether the Parliamentary and Financial Secretary can tell us if they have been made up
    1002
    by the sale of fighting machinery to foreign nations. I am sure the Committee would like to know whether there has been any such dispersal of naval instruments of various types to foreign countries, and to which foreign countries they have been dispersed.
    The Chairman: Before the hon. and gallant Gentleman goes on, I should point out that he cannot deal with matters which concern the appropriations in aid.
    Commander Maitland: I apologise very much for having transgressed the Rules of Order. The last point I wish to mention is a small one. I cannot understand why at the foot of page 3 the word following "Section II" is "Matériel". It has a French accent on the first "e." I do not think this has anything to do with naval tradition, but if it has, I, who have served in the Navy, never knew about it. Why not use the English word? I have looked up the dictionary and I find that "matériel" means "material."
    Mr. Guy: In Vote 5 there is an Estimate for "Educational services, Royal Naval College, Dartmouth." On that I should like to ask some questions. I have no objection to an increase under this head; I welcome it very much, but I am anxious to know whether in this provision of £50,000 there is any sum for an extra number of scholarships. The Parliamentary and Financial Secretary will remember that the Minister of Defence, when he was First Lord of the Admiralty, promised the House that in succeeding years, when these Estimates were submitted, more provision would be made for scholarships at the Royal Naval College. Dartmouth. I want to know whether ample funds have been provided for such scholarships.
    Mr. J. P. L. Thomas: I should like to congratulate the Parliamentary and Financial Secretary and the Admiralty on the fact that there is only an 8 per cent. difference between the original Estimate and the revised Estimate. Most of us in the Committee will feel that that is a very creditable performance in an immediate postwar period, when every kind of emergency is liable to arise. I notice in Vote I, C, which is for postwar credits and war gratuities, that compared with the original Estimate there is an increase£10,800,000, and I understand from

    1003
    the Explanatory Note that this is due to the decision that, as far as possible, the gratuities and postwar credits should be paid during the current financial year. I feel that that is a decision which will have support from these benches, and, indeed, from all sections of the Committee.
    But I should like to ask the Parliamentary and Financial Secretary one or two questions. In Vote 1A, "Wages, etc. of Officers, Seamen and Boys", it is difficult to understand how the original Estimate was insufficient by so large an amount in view of the latest figures for demobilisation, which show that the rate of release is almost level with the programme. At the turn of the year the actual release of officers and men was only 340 below the programme of 651,640. Is the reason for the rise that the new entries and re-engagements have been greater than were anticipated by the Admiralty, or is there some other reason? For in Vote 2, G, Provisions, victualling, allowances, etc.," the increased estimate rose only by £200,000, so it would appear that the reduction of strength has not been unduly retarded. I should be obliged if the Financial Secretary to the Admiralty or the Civil Lord could give the House an answer to that query, and I hope very much that the increase in Vote I, A may mean that regular officers and men, now that they are no longer engaged in active operations against the enemy, are being employed on vital duties such as scientific research. I remember giving a pledge on behalf of the Admiralty during the Estimates two years ago to the hon. and gallant Gentleman the Member for Pollok (Commander Galbraith), who in a Resolution asked the Admiralty to encourage the development of scientific research, and that promise was re-inforced by the present Minister of Defence when he presented the Estimates last year. He said that the Board of Admiralty believed that expenditure on scientific research must have priority to produce the right and the best weapons.
    The Chairman: I would remind the hon. Gentleman that that subject does not arise on these Estimates.
    Mr. Thomas: With very great respect, I thought I was keeping quite clearly to what was concerned with the expenditure in Vote 1A, and I merely wanted some information in regard to scientific
    1004
    development with which this Vote is in directly concerned owing to the decrease in Vote 6. I pass from that to Vote 3H, and I see there is an increase for hospital stores. That is as it should be, and I think we all welcome an improvement in that particular branch of the Service. In Vote 8, Section III, on page 4, I note that there is an increase of over £4 million for hulls and armour of His Majesty s ships. Is that rise due to an increase in the wages paid to the workers by the contractors or, if not, what is the cause? Are we getting better guns; are our ships better protected in every way? I should be very glad if the Financial Secretary to the Admiralty could give me an answer on that particular point.
    4.30 p.m.
    In Vote 11F I see that there is an increase in rents paid by the Admiralty amounting to £1,300,000. This seems to some of us to be an enormous figure in view of the fact that we are reducing our establishments. Can the Financial Secretary tell us the answer to that, and while doing so could he also indicate what is happening in the city of Bath? Have they yet been able, or will they soon be able to hand back a certain number of houses to their owners in that particular city? I think that if the hon. Gentleman could give now, or perhaps later in the consideration of the main Estimates, an account of what is happening in Bath it would be of interest to a large number of hon. Members
    Vote 12A, for Admiralty Office salaries, wages and allowances, shows an increase of £800,000—nearly £1 million, when the Navy is becoming smaller. If this is due to an increase in salaries for staff there, then, knowing that staff, I, for one, certainly do not grudge it. But is that so, or does it really mean that there is a larger staff, and, if so, why should there be a larger staff at the Admiralty Office at this particular moment? We should be glad to have information upon that point from the hon. Gentleman If, in fact, work at the Admiralty Office is increasing, I have been wondering how we can ease the burden from the Floor of the House. We have lately been dealing in the House with two small but important Bills—the Greenwich Hospital Bill and the Naval Forces (Enforcement of Maintenance Liabilities) Bill, and during the present Session the House has passed the former.

    1005
    This has meant an immense amount of work not only for the Admiralty but also for the hon. and gallant Member for the New Forest (Colonel Crosthwaite-Eyre) and the hon. and gallant Member for North Portsmouth (Major Bruce). It cost them their Christmas Recess in referring back to Act after Act through two centuries of Greenwich Hospital legislation. Would it not be a relief to the heavy burden of work if those Bills were consolidated in one? If so—and I meant to say this on the Third Reading of the Bill—but owing to an unfortunate mistake in the Lobbies both the Financial Secretary and I were deprived of one of our rare opportunities of addressing this House—
    The Chairman: The hon. Gentleman is not entitled in Committee of Supply to discuss a matter involving legislation.
    Mr. J. P. L. Thomas: I have only one more word to add, Major Milner. In order to relieve the Admiralty staff still further, I wonder if the House of Commons could not have back a certain amount of its own work to do so as not to overburden the staff of the Admiralty by making them deal with perpetual Orders in Council such as we saw in those two Bills. I have no more to say today, and although I think hon. Friends behind me have other points to raise, we shall, of course, reserve full discussion until the new Estimates are presented to the House next month.
    Major Bruce: I wish to draw attention to a matter which has already been referred to by the hon. Member for Hereford (Mr. J. P. L. Thomas) and the hon. and gallant Member for Horncastle (Commander Maitland)—in particular, Vote 8, Section III, which deals with the whole question of contract work. I share fully in the congratulations which the hon. Member for Hereford offered the Parliamentary and Financial Secretary when referring to the fact that the Estimates, broadly speaking, were within 8 per cent. of the original figure, but in this case the increase required under Item A of Section III of Vote 8 is £4,100,000 which, the Committee will observe, is some 14 per cent. higher than the original Estimate. This original Estimate was £28,990,000 and the revised Estimate is £33,090,000 which means, as I have said, an increase of £4,100,000. I should like to know why
    1006
    this increase has taken place. Is it because there has been more machinery; have we more armour, more gun mountings or more equipment generally? Or have we, perchance, during the year that has passed, had more hulls laid down? Or, on the other hand, has there been some fundamental defect in the whole process of estimating?
    In this particular type of estimating we are, of course, up against a very delicate problem. This is one of the occasions when Parliament itself comes into contact with the whole machinery of private enterprise. I say that without the slightest desire to be offensive to hon. Members opposite, but it is a fact that there has always been some sensitivity on this point, as those who have read Pepys' Diaries will know. There is tremendous scope for all kinds of elasticity of a more or less desirable type which takes place when Government bodies do, in fact, negotiate with private enterprise. I should like to he reassured by the Parliamentary and Financial Secretary that this increase of £4,100,000 has not been accounted for by an altogether undesirable elasticity in considering prices to sub-contractors who do work on the Admiralty's behalf. I say this with good reason, because from time to time in the House the whole question of the control of sub-contractors' prices has been brought under review, and I should like to quote in particular the Report from the Committee of Public Accounts, Command Paper 105–1, published on 12th May, 1945, in which the Public Accounts Committee passed rather pertinent observations in connection with the Admiralty control over sub-contractors' prices. On page V of that Report they say:
    "The Public Accounts Committee of 1944 reviewed the steps taken by the Ministry of Aircraft Production and the Ministry of Supply co control sub-contractors' prices by investigating firms' trading results, and in paragraph 23 of their Second Report they recommended that Departments should use their best endeavours to extend and develop this valuable method of control so far as present conditions permit."
    Then they go on to say that the Admiralty, so far, had not seen fit to adopt this particular method of price control that was adopted by the Ministry of Aircraft Production and the Ministry of Supply: Indeed, I think this Committee should take note of the fact that they passed some very pungent observations on this subject, and after all the Public

    1007
    Accounts Committee of this House are a very responsible body whose function it is to safeguard the expenditure of public finance. They said, in 1945:
    "Your Committee are struck by the disparity in the refunds secured by the Admiralty as compared with the other two main Supply Departments. They note that the Admiralty appeal to have commenced their investigations of sub-contractors' trading results later than the other Departments and they were not apparently in possession of sufficient information to satisfy Your Committee that the profits of the Admiralty sub-contractors have not as a whole been more than fair and reasonable. Your Committee recommend that the Admiralty should continue to press these investigations with a view to ensuring a more satisfactory control of sub-contractors' prices."
    At the same time, in the minutes of evidence upon which that report was based, there were several indications of which I think this Committee should take note. The first is that the Admiralty in those days announced that they fully appreciated the causes of anxiety which had arisen—and indeed, since they are a responsible Government Department, one would expect them to do so. They announced that they intended to appoint a Director of Costing Estimates. When it came to 1945 and the Committee of Public Accounts reviewed the position they naturally queried this appointment and wanted to know whether it had yet been made, but evidence was given at that time that so far it had not been possible.
    They desire to secure the services of a suitable accountant, but so far in consultation with the Treasury they have not been able to secure one. I have the honour to have been at one time an active practising accountant and I can assure my hon. Friend that if he cares to get in touch with the Institute of Chartered Accountants or the Society of Incorporated Accountants and Auditors he will be provided with a list of trained people from whom he can select, and who will be extremely pleased to assist him in this matter of costing. I should like to know what has happened to that appointment which was mentioned by the Committee of Public Accounts in the course of their deliberations published in 1945. On page 238 of that report we find that, of 732 firms into whose costs inquiries were made, 291 firms made profits of over 15 per cent. Of those 291, 115 made
    1008
    profits of between 15 and 5o per cent., 78 between 3o per cent. and 5o per cent., and 54 made profits over 5o per cent.—
    The Chairman: The hon. and gallant Member is now reading from a report, which seems to me much more appropriate to the general question of contracts. To do that might be in Order on the main Estimates, but it is not in Order on a Supplementary Estimate.
    Major Bruce: I am grateful for your Ruling, Major Milner, but I respectfully submit that in view of the fact that there is this rather large sum which is some 14 per cent, in excess of the original Estimates, it might suit the convenience of the Committee if we probed rather carefully the whole system of price control as applied by the Admiralty, or has been applied in the past—nobody knows exactly what is going on at the moment—with a view to ensuring so far as it is humanly possible to ensure that this sum of £4,100,000 paid by the taxpayer to a variety of firms has in fact been—
    Vice-Admiral Taylor: I am not quite certain, but I understand that Woolworths make about 100 per cent. How would the hon. and gallant Member's remarks apply to that case?
    Major Bruce: I am very grateful for the hon. and gallant Member's interjection. His interest in these naval matters is almost legendary. All I can say is that if the Board of Admiralty in their wisdom sought to enter into negotiations with Woolworths—I can conceive a situation in which that might arise, possibly a contract for the supply of millions of elastic bands for some indefinable purpose—I should expect the Admiralty to ensure that they were paying a reasonable price. I want to know from the Parliamentary Financial Secretary something that the Public Accounts Committee of this House has wanted to know for years, not merely under this Government but the Governments of the last 25 years—
    The Chairman: The hon. and gallant Member is again raising a question of main policy, and, if that is so, the proper occasion is on the main Estimates and not on a Supplementary Estimate. He can deal with a question relating to the increase in this Supplementary Estimate, but he cannot go on to the broader questions of policy.
    Major Bruce: May I put my remarks in the form of an interrogatory? I feel that with a sum of this magnitude one is entitled to know the reason—
    The Chairman: In dealing with this sum of £4,100,000, the hon. and gallant Member is entitled to ask the masons for the increase, but he is not entitled to go into the whole question of policy, costings and price, under which contracts are made, and so forth.
    Major Bruce: I accept your Ruling, Major Milner, but I would like to ask the Parliamentary and Financial Secretary, first, what has happened to the Director of Costing Estimates who was mentioned in the deliberations of the Public Accounts Committee? I would also ask to what extent the Admiralty have pursued their further investigations—
    The Chairman: The hon. and gallant Member cannot, on the Supplementary Estimates, raise points about the Director of Costing Estimates. If at all, that could be raised on the main Estimates. I cannot, however, allow the hon. and gallant Member to continue on this subject, neither could I allow the Financial Secretary to answer him. I can allow him to deal with any point as to the reason for the increase; otherwise I must ask him to resume his seat.
    Major Bruce: I have a practical suggestion which the Parliamentary and Financial Secretary may agree to adopt, whereby it may conceivably be that the necessity for a 14 per cent. increase in the future will not arise. This is referred to on the Paper, but it is not in Order for me to refer in detail to appropriations in aid. That is one of the pitfalls one meets in discussing Supplementary Estimates—but I do not intend to be trapped. My point is that if there is shipbuilding work to be done, by far the best way of getting that work done economically is to employ, to the full, the facilities of the Royal dockyards themselves.
    4.45 p.m.
    Lieut.-Commander Gurney Braithwaite: I should have found it agreeable had the Parliamentary and Financial Secretary found it possible to offer us a few words as a preliminary. It might have avoided some of the violations of Order into which some hon. Members
    1010
    have been straying, including the hon. and gallant Member for North Portsmouth (Major Bruce). I congratulate him however, heartily, on his tight-rope performance and I shall endeavour to emulate it. The Parliamentary and Financial Secretary expressed the desire that this Debate should take an interrogatory form and said that afterwards he would be prepared to reply to such points as were raised.
    There are two items alone on which I would concentrate. There is Vote I (A) dealing with the wages of officers, seamen and boys, which shows an increase of £3 million. I wonder if the hon. Gentleman has come armed with the information as to what percentage of this figure is covered by the Reserves? Are there not now some reservists doing sea-time in a training capacity? Have we got back to that stage of our operations? Are there any refresher courses for the more senior officers of either Reserve who might be required for a staff capacity in the event of hostilities? Is that taking place, and is it shown in this figure, and, if so, to what percentage?
    There is also Vote II (M) which deals with naval clothing, soap, tobacco, and allowances in lieu. This would be more familiar to the Civil Lord under the heading of "slops." There is a figure of £500,000 for "slops" in the Supplementary Estimate. Could the hon. Gentleman break down that figure for us? It is a little remarkable that with demobilisation proceeding as it is, and with naval groups being reduced as they are, there should be such a large increase under this heading. Can the hon. Gentleman say whether the naval clothing which can he purchased by officers and men through the dockyards and so on is still being rationed as it was in the later months of the war? If so, why is this extra £500,000 being expended under this heading? It seems a little odd. Again, there is an excellent and historic system of issuing duty free tobacco in His Majesty's ships.
    We all know there has been some increase in these things. One's views of these matters alter when one returns to civil life. One takes a contrary view when serving. Is it not rather important now, in the present state of affairs, that there should not be an unduly generous allowance of clothing to the Services, but that it should run more or less concurrently

    1011
    with what civilians can obtain, particularly in the shore establishments? Is it still the case at certain naval bases—I think at Gibraltar—that personnel serving ashore still get these duty free privileges? The Civil Lord will easily recall the harassing scenes when liberty men come ashore and have to pass through the dockyard gates. Is that still taking place? Could we know what percentage of this figure is represented by clothing, and how much by tobacco and by soap, which is becoming a rare commodity in this country? Is that still obtainable in almost unlimited amounts by naval officers and men, and if so, what percentage of this figure does that represent? Had the hon. Gentleman addressed us at the beginning, no doubt he would have covered these points. I hope that when he comes to reply, which will not be yet because some of my hon. and gallant Friends have other points to raise, he will state what is the present expenditure on the training of reservists, and why we are spending £500,000 more on "slops" in the year 1947.
    Captain Marsden: I wish to keep within your Ruling, Major Milner, but when we come to an authorisation to spend a large sum of money. I hope you will permit some general criticism, rather than just a series of questions as to "slops" and how much soap can be taken ashore. The total amount involved here is in the neighbourhood of £38 million, and it is by the selling of secondhand goods to our Allies and the Dominions that we have been able to diminish it to the neighbourhood of £20 million. You would not permit me, Major Milner, to go in detail into appropriations in aid, which would have a material effect upon the sum we are discussing. We are really trying to ask whether the Admiralty are making the fullest use of the money to which we are being asked to agree, and which they have largely spent. I often wonder what would happen if we did not accept these Supplementary Estimates. No doubt they would be passed for the honour of the House.
    Is the Admiralty going to spend the money on the Naval Reserves? Of all questions apart from national security at the present time, the most pressing and the one on which most questions are
    1012
    asked, is: What is the future of the Royal Naval Reserve and the Royal Naval Volunteer Reserve? So far, we have had no official communication of any description. We are now asked to give an amount for the purposes of the Royal Naval Reserve but we want to know something more about it.
    The Chairman: The hon. and gallant Gentleman is in error in raising that matter on Item 7. That cannot be discussed now.
    Captain Marsden: If one surveys the Estimates generally, one is forced to the conclusion that the services of the Navy are very largely wrapped up with foreign policy. Yet we cannot discuss foreign policy because this is a Navy Debate. We may however ask why the Admiralty is continually under-estimating. Is it the case that the commitments of the Navy are far greater now than was thought to be the case a year ago, when we thought we would be sending men home from overseas, paying off ships and reducing establishments? That has not been done, merely because a Department of State rather let the Navy down in that respect. I do not ask for a general survey of the position, but I ask hon. Members to refer to Vote 11 which will justify what I have said. That deals with travelling expenses, and one would have thought that some more or less accurate forecast could have been made. But what do we find? It is £2,700,000 short. The next item, pilotage, is £400,000 short; telegrams, telephones, lodging allowances and rents are also short. I do not know what rents are concerned; I am sure that there are some places where the original occupiers would be thankful if the Navy got out, but the Navy still sticks there. There is a Supplementary Estimate for £1,400,000 for rents. Then there is compensation. Judging by my knowledge, the figure might have been much larger. Nobody seems to get enough compensation when the Government's occupation is cleared up, but with due respect, the Navy leaves accommodation in a far better condition than the Army does. The figure for industrial canteens is, I notice, £450,000 more than was estimated.
    There is another point to which I should like an answer from the Parliamentary and Financial Secretary, and that is in regard to the Indian Defence Expenditure Plan. There was an original

    1013
    Estimate there of £1,000,000, which has now gone up to £1,650,000. With India taking over our obligations and establishments, I should have thought that that item might have been an appropriation in aid, and that they would have paid money for taking things over. Perhaps I am on the wrong track, but I would ask the hon. Gentleman to explain that item, which is incomprehensible to me and to every other person I have spoken to on the matter. The general trend is that the Navy, taking into account our foreign policy, is not being reduced to the extent that everyone expected, involving extra expenditure of which I think the Parliamentary Secretary, without bothering too much about individual items, must give a really satisfactory explanation.
    Mr. Mallalieu: Of all the questions which have been asked today there is one group which I hope will not be answered, namely those asked by the hon. and gallant Member for Holderness (Lieut.-Commander Gurney Braithwaite) on Vote 1, because those questions were apparently directed to the cutting down of certain privileges to men serving in shore establishments. Anyone who has any experience of Royal Navy barracks and of the sort of buildings they are knows that men in them need all the soap, rum and other amenities they can have. Indeed, it is staggering to me that expenditure on repairs is actually lower than the estimate. I do not see how they can possibly cut expenditure on repairs to the barracks. There is one question about stores on Section II of Vote 8—stores and equipment—or rather since it is covered by that revolting word "material," I suppose I should say "equipment." How is it that at the present time Item A shows an increase? Ships have been paid off and shore establishments are being closed down rapidly, and stocks of all kinds are piling up in the dockyards and on agricultural land round about Portsmouth, covered with tarpaulins. How is it that the total for stores has been increased, and is that increase a net figure or does it take into account the proceeds of the sales of naval surplus stores which are going on at the present time?
    5.0 p.m.
    Mr. Douglas Marshall: I want to make one or two points on this
    1014
    Estimate and I trust I shall be able to keep in Order, as to take part in this Debate is rather like skating on thin ice. There appears to be an increase of £3 million against the wages etc., of officers and men of the Royal Navy and the Royal Marines which, on the original amount, is an increase of approximately 6 per cent. It appears to me, if we turn to the next page and study for a moment the increases on travelling, assisted passages and expenses, and also under E for lodging allowances, etc., that the increases have been in these cases about 56 and 82 per cent. I was wondering whether the difference between these two percentages is due to the fact that under expenses the real values of today become apparent, whereas in questions of pay they do not appear straight away.
    My next point is concerned with the Royal Naval Volunteer Reserve and the R.N.R. I realise that I cannot refer to that particular Vote because it would be out of Order, but at the same time no doubt somewhere in this particular Estimate provision will be made from time to time for expenses inclined through having the R.N.R. and the R.N.V.R. I sincerely trust the Admiralty will make every provision they possibly can to take into the R.N.R. the men who are sailing in the fishing vessels and who are so absolutely vital to our security.
    I would make a further comment, which applies not only to this particular Estimate for the Navy, but to all these Estimates. Today it is very important to know what exactly are the expenses of this country incurred externally. On all occasions, when the actual figures arise in this House, they are quite properly arid naturally expressed in sterling, and I wish to ask the Parliamentary Secretary to the Admiralty if he can state how much of the £20 million asked for as a Supplementary Estimate may be required in hard currency when it comes to the actual payment. Lastly, I would like to refer for a moment to Vote 16, but unfortunately I see that there is a decrease, and therefore I should be out of Order if I referred to the fact. Perhaps, however, I might be in Order in saying that somewhere in this paper, provision will have been made for—
    The Chairman: The hon. Member is out of Order. He cannot discuss a Vote on a decrease.

    ROYAL ASSENT
    Whereupon The GENTLEMAN USHER of the BLACK ROD being come with a Message, The CHAIRMAN left the Chair.
    Mr. SPEAKER resumed the Chair.
    Message to attend the Lords Commissioners.
    The House went; and, having re-turned—
    Mr. SPEAKER reported the Royal Assent to:

    1. Greenwich Hospital Act, 1947.

    2. Trustee Savings Banks Act, 1947.

    3. Pensions (Increase) Act, 1947.

    4. Road Traffic (Driving Licences) Act, 1947.

    5. Malta (Reconstruction) Act, 1947.

    6 House of Commons (Redistribution of Seats) Act, 1947.

    And to the following Measure passed under the provisions of the Church of England Assembly (Powers) Act, 1919:—
    Incumbents (Discipline) Measure, 1947.

  SUPPLY
  Again considered in Committee.
  [Mr. HUBERT BEAUMONT in the Chair]
  Question again proposed, "That a sum not exceeding £20,000,000 (Supplementary) be granted for the said service."
  5.15 p.m.
  Mr. D. Marshall: When I was interrupted I was almost at the end of my speech. I trust that the Admiralty will do all in their power to keep a close association with the Merchant Navy.
  Colonel Crosthwaite-Eyre: I wish to call attention to Vote 8, Section II, Item K. I should very much like to know from the Financial Secretary whether the claims for oil repayments are included in this item and to which countries they refer. Why are these countries now claiming? In other words, it seems curious at this time that we should be called upon to pay for such things as oil which was, presumably, given to us for use in the common war effort. A second question is: What is this item "Waiver of claims against certain Allies." Surely, again, all expenditure was a contribution to the common war effort. Is it not rather late
  1016
  in the day for us to be faced with having to repay, or to waive claims, against certain of our Allies? Surely the time has come when these claims should no longer be considered by His Majesty's Government, but should be honoured as expenditure in the common cause of winning the war. A third point is the item "Indian Defence Expenditure Plan." Of all the countries in the world, none benefited more than India from joint defence, and no country can owe us more at the present day. To find 18 months after the end of the war that the original estimate for 1946–47 of £1 million has now gone up to £1,650,000 seems a travesty of justice. I hope that the Financial Secretary will at least tell us that no further expenditure will be called for under this heading.
  There is one other point. arising under Vote 13, B, "Retired Pay". The Financial Secretary knows that very considerable grievance is felt by many in the Royal Navy and the Royal Marines at the slowness with which the increased pensions are becoming payable. We welcome that increase, but we regret that it is so small. I hope that the right hon. Gentleman will be able to assure us that it will be very much larger in the full Naval Estimates, so that further delay in obtaining the correct scale of pension will be obviated.
  Mr. Willis: I want to raise two questions in connection with the extra sums asked for pay and for naval stores. I find it difficult to understand why we should be asked for an additional £6 million in respect of wages and salaries, while we are being told that there is a terrible shortage of manpower in the Navy. We are told that the Fleet exercises are jeopardised by reason of the fact that they have not the men. I should have thought that if the Admiralty were rather too optimistic in estimating the extent to which they could reduce Naval forces, that would have been offset by the fact that now they have not sufficient men to meet their present needs. It seems to me that today there are far too many chief petty officers and petty officers. Could not my hon. Friend the Parliamentary Secretary consider some means of reducing the numbers, which would help to reduce this charge, and bring about a better balance as between seamen, leading ranks, petty officers, and chief petty

  1017
  officers? This matter is causing considerable concern, since it means that the prospects of promotion are seriously diminished.
  With regard to the amount required for Naval storage, this seems to be rather difficult to reconcile with the fact that the Admiralty have found that their commitments now are much greater than they estimated at the beginning of the year. Surely, that ought to mean that the requirements of storage should be less, and not greater. If the supplies are still being used at sea and in depôts, dockyard establishments, and so on, there should be less storage space required. I cannot understand how this additional charge for storage has arisen, unless it is because the Admiralty are storing quite a lot of stuff that is rapidly becoming obsolescent. I think we ought to have some assurance about that. I suggest to the Parliamentary Secretary that the matter ought to be considered, because it is not reconcilable with the fact that there is a large Fleet afloat at the present time and that there are more dockyards and shore establishments in being, than it was originally estimated there would he. Can the Parliamentary Secretary tell us something about the nature of the stores? Is he satisfied that many of the stores being held are not becoming rapidly obsolescent and should be handed over, in a much more wholesale manner than has been done in the past, to the Ministry of Supply for disposal?
  Mr. McKie: I wish to join in the protests that have been made about the way in which the Parliamentary Secretary introduced this Debate, or, should I say, the way in which he failed completely to present the Supplementary Estimate to the Committee. In the long years I have been privileged to be a Member of the House, I do not think I have ever on any occasion heard a Minister, whether senior or junior, come to the Committee and merely sit back and allow hon. Members opposite to open the discussion on a Supplementary Estimate. As the Debate has proceeded, it has become clearly evident that there are many points about which many hon. Members, particularly on the Opposition Benches, are very much concerned. If the Parliamentary Secretary had been able to say something about some of the subheads in opening the Debate, he might have saved
  1018
  himself a good many questions. I would like, in passing, to say that we had a somewhat similar exhibition last week, when the Supplementary Estimate for the Ministry of Civil Aviation was presented, on which occasion the Parliamentary Secretary to the Ministry of Civil Aviation did say something, but in such a perfunctory and cursory manner, that the Debate lasted very much longer than would otherwise have been the case.
  There are one or two questions I wish to put. The first concerns subhead E of Vote I, the increase of £300,000 in the Women's Royal Naval Service. I do not object to any increase—far from it—but I would like to have a little information about what it is proposed to do with this further sum of money. Every hon. Member loudly applauds what the Women's Royal Naval Service did during the war and recognises the great work they performed, and wants to see that Service go on in time of peace. I am sure there will be a response from the Government side of the Committee to what I say, because all of us have constituents who have served in that new, but nevertheless great, branch of the Royal Navy. I am sure that even the hon. Lady who represents accidentally the Exchange Division of Liverpool (Mrs. Braddock) will agree with me when I say that.
  Mrs. Braddock: Accidentally?
  Mr. McKie: It would be out of Order for me to tell the hon. Lady what I mean by "accidental," but she had the great good fortune to win a seat that one would not have expected to see represented by a Socialist Member. I would like again to emphasise the great work which the Women's Royal Naval Service did during the war, particularly in harbour work, where they performed their duties magnificently.
  With regard to Subhead A of Vote I, which was dealt with by my hon. and gallant Friend the Member for South Paddington (Vice-Admiral Taylor), who has given the whole of his life to the Senior Service. Nobody on this side of the Committee grudges the additional £3 million for the wages of officers and men. but I would like to know something about what it means. To use the words of my hon. and gallant Friend. I hope it means

  1019
  that our present administrators at the Admiralty are keeping the Royal Navy up to the position in which we all want to see it. On Vote II, subhead M—Naval clothing, soap and tobacco, and allowances in lieu—one hon. Member who is not now present tried to make a political point about a question that had been addressed to the Parliamentary Secretary concerning this subhead, the innuendo being that hon. Members on this side wished to see the tobacco and soap and allowances in lieu cut down. I am sure that the hon. Member's attempt will fail, as in justice it deserves to fail. The only reason anybody wishes to ask a question about soap, tobacco and allowances in lieu is to make sure that the men are getting enough.
  Major Cecil Poole: I think it will be within the recollection of the Committee that my hon. Friend made the point that privileged tobacco and cigarettes should not be allowed to men on shore establishments. He referred to the position in Gibraltar. His point was that privileged tobacco should not be allowed to men on shore establishments.
  Lieut.-Commander Braithwaite: I am sure the hon. and gallant Gentleman does not wish to misrepresent me. I asked what was the situation at present. During the war, duty-free tobacco was available only to shore establishments if there was a barbed wire fence, and sentries outside, and so on. I was simply asking whether that position still existed, and putting the question on this subhead, which covers tobacco. The hon. and gallant Gentleman must not impute sinister motives to one who wishes to serve these men.
  Major Poole: I apologise if I misunderstood the hon. and gallant Gentleman, but I could not understand the reason for asking whether the practice was being continued unless it was either with the desire to continue it or else to reduce it. If I have done the hon. and gallant Gentleman an injustice, I apologise.
  5.30 p.m.
  Mr. McKie: By way of reply to the hon. and gallant Member for Lichfield (Major Poole), I will say that I did not so understand my hon. and gallant Friend the Member for Holderness (Lieut.-Commander Braithwaite). I should like to know how much is paid in allowances in lieu of tobacco.
  1020
  No one has yet asked for information about Vote 6. I should like some information about Subhead O:
  "Miscellaneous Expenses of Research Establishments and Laboratories, and of Scientific Research."
  The Deputy-Chairman (Mr. Hubert Beaumont): We cannot discuss Vote 6. because there there is a decrease.
  Mr. McKie: I should like a little additional information about Vote 8, which causes an increase, and which has been touched upon by a number of hon. Members, particularly the hon. and gallant Member for North Portsmouth (Major Bruce). If he had read the Vote a little more closely, he would have seen that by far the bulk of the sum asked for, nearly £4 million, goes on wages, either in dockyards at home, or in naval yards abroad. Does this mean that the Royal Navy are being kept in the properly fighting fit condition which we all wish to see?
  I would like to reinforce what my hon. and gallant Friend the Member for Chertsey (Captain Marsden) said about Vote 11, Subhead U—Indian Defence Expenditure Plan. The original Estimate was for £1 million, and the increase is £650,000. Why is there such a large increase, more than half the original estimate, at a time like this, when the future of India is not being prepared for in the way in which we on this side of the Committee would like to see? I hope the Parliamentary and Financial Secretary when he replies will do something to atone for his very serious sins of omission.
  Mr. J. Langford-Holt: When my hon. Friend the Member for Hereford (Mr. J. P. L. Thomas) began his speech, he congratulated the Parliamentary and Financial Secretary on being within 8 per cent. of his original Estimate last year. I think that probably those congratulations were a little premature., My hon. and gallant Friend the Member for Chertsey (Captain Marsden) pointed out that that was by no means the case. I wish to ask a question on Vote 4. This question arises on all these Estimates, but I would direct particular attention to Vote 4, A—Salaries and Allowances—in which there is an increase of about 40 to 41 per cent. over the original Estimate, and under "Wages" we have an increase of over 50 per cent. Could the hon. Gentleman tell us whether the services rendered have increased by

  1021
  that 40 or 50 per cent., or whether in fact the wages have increased by 40 or 50 per cent.? I should like this question cleared up, because it applies not only to Vote 4, but to practically every other Vote.
  Sir William Darling: I am glad that my hon. Friend the Member for Galloway (Mr. McKie) has spoken, because there is an idea that Scottish Members are not interested in naval matters. That is quite a misconception. Our fame as a martial race is not exceeded on land, air or sea. I welcome the opportunity to take part in this discussion. I am particularly interested in Vote 5 dealing with Educational Services, in which there is an increase of £50,000 in connection with the Royal Naval College, Dartmouth, under the heading of "Salaries, Wages and Contingencies." I am interested to know whether under "contingencies," which is a very wide and embracing term, there is any allowance of an educational character for Scotland, or if we are to understand that those who aspire to such educational services as the Royal Naval College provides proceed to Dartmouth for that purpose? Are there any educational establishments, other than the Royal Naval College, covered by "contingencies"? At an earlier stage it was ruled that one must not discuss a decrease, but I should like to refer to Vote 6 dealing with research establishments and laboratories. I take it I cannot discuss that, but I can make the comment that it seems regrettable that there is an amount—
  The Deputy-Chairman: The hon. Member cannot even make that comment.
  Sir W. Darling: If I were anxious to pit my insignificant ingenuity against your power and authority, Mr. Beaumont, I would merely read the Vote, but I am not going to do that.
  The Deputy-Chairman: That. also, would be out of Order.
  Sir W. Darling: I proceed on to safer ground, to Vote 8. Section 1 refers to personnel in dockyards at home and to work in His Majesty's dockyards. There is a substantial increase of some £4,250,000. I am curious to know and the Scottish public will be interested to know, what considerable proportion, if any, is being spent in the Scottish area. It is a noteable
  1022
  fact that when peace is with us, the Navy Estimates principally bear on the South East of England—Portsmouth, Plymouth, Chatham and Dover. Those are the great names in naval history, but when war descends upon us—and this has been true of many wars—the names are Clyde and the Forth, Rosyth and Scapa Flow. It is worth considering whether a considerable expenditure in peacetime diverted in that direction, would not be strategically and economically a wiser policy than that which has been followed in Vote 8.
  In Vote 10 I notice there 'is a decrease marked and I must not mention that. Vote 11 brings me to my last point. In the kind of business I follow, a petty and unimportant business, we are particular about the postage and stamp book. Hon. Members will be familiar with that kind of introduction to commercial life and what is usually the first job that a junior has to follow. I direct attention to item D—"Telegrams, telephones and postage." The Navy is a very great Service, and here they are asking for an increase of no less than £250,000 on their estimated expenditure for telegrams, telephones and postage, an increase which will bring the amount spent on those items in His Majesty's Navy, irrespective of their own equipment, to £10,000 a week. I think that is the figure; the hon. Gentleman will correct me if I am wrong. The sum is no less than £520,000. I think the public should know that, on telegrams, telephoning and postage, this fantastic sum of £10,000 is spent every week—£2,000 a day if one leaves out Saturday and Sunday, on which naval men in offices do not do very much work.
  If I were responsible for the accounts of His Majesty's Navy, that is a figure at which I would look closely. I would want to know how it is possible that a Service which has its own signalling equipment, its own intercommunication apparatus, through the far-spread Fleet, and its own wireless communications on the vast scale which accompanies a worldwide naval service, and which has the right to send communications "On His Majesty's Service" without payment, yet manages, under this majestic Administration, to spend £10,000 per week on telegrams, telephones and postage. It requires a little explanation, which I shall await with eagerness.
  Sir Ralph Glyn: I desire to ask the Parliamentary and Financial

  1023
  Secretary a few questions. Vote 3 deals with medical services. Can the Committee be informed what progress is being made by the Committee appointed by the three Services to see what amalgamations can take place in hospital accommodation, because considerable saving might result? It would probably lead to greater comfort and attention for the men, and would certainly be an improvement in medical services. The other point I want to ask concerns Vote 11, in which there is an item for "Lodging Allowances, &c., to officers, &c., of His Majesty's Ships." The Committee should realise that the present allowances to officers, when they are sent to places like Bath, and leave their own home and family, are extremely inadequate. It puts a severe burden on officers and others who are sent to these out-stations. The majority of them have homes to support, and from personal contacts with them, I know that they find it very difficult to live in London, because the amount of the allowances is very small. That allowance is paid in order to enable the officer to make both ends meet. It should not be made almost impossible for them to live on their pay. The cost to a naval officer of living ashore is infinitely greater, under modern conditions, than the cost if he were serving on one of His Majesty's ships. I should be grateful for information on that subject.
  The Committee would be interested to know how much longer Bath is to be retained. A large number of officers and men are there, and there is constant travelling between Bath and London, which is inconvenient, and bad for administration. I should have thought that before this Estimate was presented, some explanation would have been given of why that wartime arrangement is being continued. Finally, I think that the Committee might have some reason given for the scanty so-called "explanation" which appears on page 6. It has always been the custom, when a Supplementary Estimate has been presented, that the explanation should be fairly full. That was certainly the case with other Supplementary Estimates we have had, but in this, there is little explanation, and it is due to the Committee, that we should hear a little more. I hope that the Admiralty will be able to assure the Committee on some
  1024
  details which are not contained in the printed matter on page 6.
  Vice-Admiral Taylor: I wish to ask a question on Vote 13. I see that under the heading "Retired Pay" there is an increase of £130,000. Is the sum now to be spent sufficient to give to all officers, who have retired under the provisions of the Royal Warrant of 1919, pensions bringing them up to the basic rate laid down in that Warrant? It will be remembered that in 1935 these pensions were stabilised at a figure nine and a half per cent. below the basic rate, and they have not yet been made up to that rate. These officers have a real grievance in this matter, and undoubtedly it is a breach of faith on the part of the Government that the provisions of the Royal Warrant of 1919 have not been carried out.
  5.45 p.m.
  The Parliamentary and Financial Secretary to the Admiralty (Mr. John Dugdale): I am sorry if it was considered that I should have risen to speak first. I should have thought that the Committee would have had too much of me by the time I had finished answering these questions. I admit that I must take some time in answering them, as is only right and proper. I will try to take them in Order. The hon. and gallant Members for Holderness (Lieut.-Commander Braithwaite) and Chertsey (Captain Marsden) both raised the question of the R.N.R. and the R.N.V.R., and asked whether the figures were contained in Vote 1. They are not contained in this Vote at present. The sum being spent on these two Services is certainly small, but that is not to say that we do not want to encourage, in every possible way, the growth of these two Services. We hope that they will be built up to a much greater extent than has been possible up to date. We shall do our utmost to see that both become, as they were before the war, two most important branches of the Royal Navy.
  The hon. and gallant Gentleman the Member for Horncastle (Commander Maitland) asked why there were so many men ashore and so few at sea. I propose to deal with that point at greater length in my speech on the Navy Estimates. I would only say that there is an organisation called the Naval Air Arm, which was hardly in existence before the war, and there are large numbers of men now

  1025
  stationed at aerodromes in this country who were not so stationed before. It is one example, and a big one, of the change in the disposition of men ashore and afloat. These men are on shore jobs which are vital to the Navy. The hon. and gallant Gentleman the Member for Horncastle and my hon. Friend the Member for South Poplar (Mr. Guy) asked about Dartmouth. The figure of £50,000 in the Estimate was the result of an error in the original Estimate and the revised Estimate implies no change in policy. Nothing is being done to Dartmouth, or taken away from Dartmouth.
  Captain Marsden: Does that Vote include the change from Eaton to Dartmouth?
  Mr. Dugdale: Yes. My hon. Friend the Member for South Poplar also raised the question of the scholarships which were introduced by my right hon. Friend the present Minister of Defence. They have indeed proved extremely successful, and we are continuing them. They are opening Dartmouth to a class of people who had never had any opportunity previously of going through Dartmouth, because of lack of funds. The hon. and gallant Member for Horncastle asked a question which interested me. I also saw this peculiar word "Materiel." I was interested to know why it was there, as I very much dislike even the word "personnel" which I use every day. I dislike this word even more, but I made some inquiries and I find that it appears in "Chambers' 20th Century Dictionary" and is apparently now recognised as English. It means
  "The totality of materials or instruments employed (as in an Army) as distinguished from the personnel or men—applied especially to military stores, arms, baggage, forces, etc."
  Commander Maitland: Is it not time that we withdrew recognition?
  Mr. Dugdale: I am not quite certain that it comes within the Vote to withdraw recognition to Chamber's Dictionary.
  Perhaps I might pass on to something which might be closely related to that. The hon. Member for Hereford (Mr. J. P. L. Thomas) asked for some further details in connection with the increase of the cost of personnel. That is due, first, to slower release than was estimated originally. Roughly £4.7 million is due to that, and roughly £2 million is due mainly
  1026
  to something which I think all hon. Members will welcome, namely the new pay code. The hon. Member also asked a question about scientific research. I think I had better say as little as possible about that on this Vote, but I will certainly refer to it on the Navy Estimates. In regard to the question of rents, I was extremely interested in the solicitude of the hon. Member for Hereford and the hon. and gallant Member for Chertsey about the Admiralty having to pay rents to landlords. I should not have been at all surprised if speeches of that kind had come from this side of the Committee. I am very interested when they come from hon. Members opposite.
  The main reason for this increase in rents is that, strictly speaking, they are not rents in the ordinary sense of the term. They are arrangements for compensation made in connection with de-requisitioning. There has been a great deal of de-requisitioning this year, and in consequence, there have been a great many payments. Reference was also made to the size of the staff of the Admiralty. I think I need hardly say to the hon. Member that although the staff is considerably bigger than it was before the war, I am sure that he would be the first to recognise that exceedingly good work is done.
  Mr. J. P. L. Thomas: I said so.
  Mr. Dugdale: We are constantly taking steps to see that the staff is kept down to the very minimum which is necessary to keep the Navy running in the efficient manner which we expect. Such duties as the payment of gratuities, the general settlement of claims and contracts, and other things which must be done at the end of a war, necessarily involve the employment of a larger staff than is kept under normal conditions.
  The hon. and gallant Member for North Portsmouth (Major Bruce) went into considerable detail on the question of contracts. I am not quite certain how far. I could go without being out of Order in replying to him. I think in the time of my predecessor, at any rate approximately in 1941, the Admiralty decided for the first time, to go into greater detail in the examination of contracts than had been the case previously. That was done with considerable success. Today we find that, even with that greater examination.

  1027
  there are cases where firms have charged prices which allow for as much as 33⅓ per cent. profit. I am glad to say there have not been many cases, but there have been some. We consider it of vital importance that we should be able to investigate all these costs. We should have a reasonably large staff for that investigation in order to effect as great a saving as possible.
  The hon. and gallant Member for Holderness talked about "slops." He was concerned to know about duty-free tobacco. The position is exactly as it was in the past. I can assure him that there has been no change in that respect. I would remind him that the lodging allowance has almost been doubled, and that contributes to an increased cost—
  Lieut.-Commander Braithwaite: Does that come under this heading?
  Mr. Dugdale: Yes. The position in regard to soap is also unchanged. As he and other hon. Members connected with the Navy know, the sailor has to do his own washing and he needs a considerable amount of soap for that purpose. The figure is an increase on the Estimates for this year, not an increase on the expenditure for last year, which is quite a different matter. The hon. and gallant Member for Chertsey and the hon. Member for Galloway (Mr. McKie) asked about Indian defence expenditure. The position is that we are liable for all Indian naval defence expenditure in excess of a certain ceiling. If that ceiling is exceeded, as it has been this year, the Admiralty must pay the difference.
  The hon. Member for Huddersfield (Mr. Mallalieu) and the hon. Member for North Edinburgh (Mr. Willis) were concerned about the increase in the cost of stores. They asked whether we had many obsolescent stores. I can assure them we have not. This increase is due largely to the late settlement of war contracts. The hon. Member for Galloway dealt with the subject of the Women's Royal Naval Service. He said he welcomed the increase in expenditure. He hoped that the Admiralty would use women as far as possible, and that the Women's Royal Naval Service would be developed. That is what we intend to do. We hope to develop this branch to the utmost possible
  1028
  extent. We know that women can do very many jobs in the Navy which, before the war, people thought could only be done by men. Today, we are able to have them done by women and we intend to employ them in this work to an increasing extent during the coming years.
  The hon. Member for Shrewsbury (Mr. Langford-Holt) asked about the salaries and wages of civilians. They show an increase for two reasons. First, certain work has been done in the Royal Dockyards in order to be certain that men were not thrown out of work unnecessarily. We attach great importance to this. Among this work is what is known as "repayment work." We have employed quite a large number of men on "repayment work" which has included the manufacture of such vital things as housing materials. Approximately 5,000 men have been employed. If this work had not been arranged it is quite possible that they might have been temporarily unemployed. Apart from that, the men's wages have risen during the year—
  Sir W. Darling: Is that borne on the Navy Estimate if it is a contribution to the housing needs?
  Mr. Dugdale: That is where the hon. Member is under an illusion.
  Sir W. Darling: Will the hon. Gentleman dissipate it for me?
  Mr. Dugdale: I will give an illustration. If a private company intended to make some housing materials, it would put down a certain sum by way of capital which would be said to be an investment, and the firm would expect a return on it. That is exactly what we are doing. Under the system of Government accounting, this goes down as expenditure. In fact, we hope to get an ample return from the people who buy the products which we make, whether they are bought by Government Departments or private firms.
  Vice-Admiral Taylor: What is the profit made by the Admiralty?
  Mr. Dugdale: I shall be able to give the hon. and gallant Gentleman a better idea of that at the end of the year. The hon. Member for South Edinburgh (Sir W. Darling) was concerned with the questions of Scotland and of telephones. Those were the two matters which exercised his

  1029
  mind. I entirely agree that Scotland plays a very important part in wartime. We all know that without Scapa Flow, the Navy might have been in a very bad way during the last war. Scotland will not be neglected. I can assure the hon. Gentleman that Scotland will have its due portion of whatever is spent by the Navy. As regards telephones, I can only assure the hon. Gentleman that the Admiralty is a very large organisation, and it is not surprising that we should spend a considerable sum on telephones. I understand that, in fact, £220,000 of this account is in respect of a wartime account of Cable and Wireless, which has only recently been received. Had we received it earlier, it would obviously have been placed in the original Estimate.
  Sir W. Darling: Is that also included in the postage bill?
  Mr. Dugdale: Well, telephones are considered to be part of postage.
  Sir W. Darling: The hon. Gentleman did not say so.
  Mr. Dugdale: The hon. Member for Abingdon (Sir R. Glyn) referred to medical services, and to the committee on the question of their amalgamation. I can only say that the committee has not reached a final conclusion. When it does, I have no doubt that the Minister of Defence, or the proper Minister, would announce it, but I can say nothing further about that now.
  Finally, I would just say that I was grateful to the hon. Member for Hereford when he said that, on the whole, these Estimates were very reasonable in not showing a very great excess. I think the hon. Member is right there. I would remind him, although I am sure he knows, that, after the previous war, the Admiralty experienced much greater difficulty in making an Estimate which was reasonably near the mark. In fact, some considerable period after the war, the Admiralty had to ask, not only for increased Estimates, but for an Excess Vote. I think the officials of the Admiralty have discharged their duties very well in getting as close as they have done. I hope that the Committee will give us this Vote and realise that it is due to the fact that we are changing from war to peace, which is the most difficult time in which to try to estimate correctly.
  Vice-Admiral Taylor: Will the hon. Gentleman give me an answer to my question about officers on retired pay—those who were retired under the 1919 arrangement?
  Mr. Dugdale: I have answered a very large number of points. I will answer that one at a later date.
  Vice-Admiral Taylor: Why cannot the hon. Gentleman answer it now?
  Commander Noble: As the hon. Gentleman referred in his reply to the Reserves, and made a definite statement, perhaps I would be in order in saying a word or two. The hon. Gentleman said he hoped to make the Reserves as good as they were before the war. But I hope, and I think we on this side of the Committee are all agreed, that these Reserves are going to be given far more advantages than before the war. We all consider that a great deal of time has been wasted—
  The Deputy-Chairman: The hon. and gallant Member is out of Order in discussing these details.
  Colonel Crosthwaite-Eyre: Would the Parliamentary and Financial Secretary say what the repayment claims are for, and what are the payments? Would he also say what are the waivers of claims to our Allies, and to whom we made them?
  Mr. Dugdale: Yes, Sir. On the second point, waivers of claims have been made to France and Yugoslavia.
  Colonel Crosthwaite-Eyre: Why have we made the claims?
  Mr. Dugdale: Quite frankly, I admit that I cannot answer that question off-hand.
  Sir R. Glyn: Could the hon. Gentleman give any assurance at all about allowances to officers, whether out-stations are to be reduced and whether the officers are going to be given these increases?
  Mr. Dugdale: No, Sir; I would prefer to deal with that in the main Estimates, and I assure the hon. Member that I will give him a full reply then.
  Mr. J. P. L. Thomas: Has the hon. Gentleman any further information on the position in Bath? Could he give a fuller reply, if not now, on the main Estimates?
  Mr. Dugdale: Yes, Sir. I can only say that, as hon. Members know, there is a considerable shortage of housing accommodation in London, and it is exceedingly difficult to move a large staff to London. I will not say more than that now, but hon. Members will realise that it is not an easy task to move such a large number of people straight away to London.

  SUPPLY
    ARMY SUPPLEMENTARY ESTIMATES, 1946–47

      ADDITIONAL NUMBER OF LAND FORCES
      Motion made, and Question proposed,
      "That an additional number of Land Forces, not exceeding 65,000, all ranks, be maintained for the Service of the United Kingdom at Home and Abroad, exclusive of those serving in India on the Indian Establishment, during the year ending on the 31st day of March, 1947."
      6.5 p.m.
      The Financial Secretary to the War Office (Mr. John Freeman): I have to ask the Committee to vote an increased total of 65,000 in the Land Forces for the year 1946–47, together with a large increase of money for the same year. When Supplementary Estimates are presented at this time of the year, the usual custom is to present, not only the total increase which is asked for, but also any variations of expenditure between the Estimate as originally approved and the final state of the account as apparent at the end of the year. In presenting this Estimate,. we have followed that practice, and, although a very large number of Subheads are included in it, it will, I think, be agreed by the Committee that it makes the position reasonably clear as to how this money has been expended and what variations there have been between the original Estimate and the present time.
      In view of the pitfalls that surround us in Debates of this kind, I think it conceivable that the Committee will not judge the present moment to be particularly appropriate to have a full Debate on these affairs. Nevertheless, it would not be right to ask for these substantial increases without giving some explanation why we want them, so I propose to draw attention to some of the more important elements of increased expenditure which appear in these Estimates.
      In the first place, neither of these Estimates contains any matter which has
      1032
      not been brought before the Committee previously. They are required to implement decisions taken by the Government which have been considered by the House during the course of the past 10 months. In a certain sense, they might be considered analogous to the Money Resolutions which we consider after the Second Reading of a Bill. The biggest single item of major expenditure is £37 million for the, war gratuities and postwar credits of Servicemen and women who are still serving.
      The Temporary Chairman (Colonel Ropner): We are discussing Vote A, and that point does not arise on this Vote.
      Mr. Freeman: With respect, Colonel Ropner,. I thought I might be able to take both Votes together.
      The Temporary Chairman: No. The Committee must take Vote A separately.
      Mr. Freeman: I beg the Committee's pardon, and I will deal with Vote A separately. I drew the attention of the Committee to the explanation which is, in fact, printed with the Estimate. It is simply that Vote A allows the military authorities to retain a maximum number of men on any given day in the course of the year, and it follows that, at the time of the run-down period, that maximum will probably be reached.
      On this particular occasion, owing to the slight postponement of the withdrawal of certain Indian troops from stations outside India in the early days of April last year, the strength of the Army borne on Vote A was 65,000 higher than we had estimated. That excess disappeared automatically within the course of a few days, and this Vote has nothing whatever to do with any slow-down or acceleration in the release quota. It is concerned merely with expenditure in the first days of the financial year. With that explanation, I trust that the Committee will agree to the Motion.
      Brigadier Low: I would like to go into this question a little more closely. If the Committee will turn to the statement made by the Secretary of State when he moved the Estimate on 14th March last, it will see that, in actual fact, the excess over his Estimate, into which he went in some detail, is not £65,000, but £107,000, so that really the

      1033
      Secretary of State and those working with him underestimated to the extent of £107,000. My second point is that I would like the Financial Secretary to tell the Committee in what stations these Indian troops were kept at that time, because that information might help us at a later stage of the discussion this afternoon.
      Mr. Hopkin Morris: I should like to ask the Financial Secretary whether any part of the sum now asked for in the Supplementary Estimate is to be devoted to the reorganisation of the Army, and, if so, whether we 'may discuss some of the problems of that reorganisation on this Vote?
      The Temporary Chairman: A question of that sort will have to be discussed on the Vote which follows this one.
      Mr. J. Freeman: I frankly confess that I am not quite clear about the first point raised by the hon. and gallant Member for North Blackpool (Brigadier Low). I have not the reference to the OFFICIAL REPORT which he is carrying with him, and I am sure that he will hardly expect me to read it now at short notice while I am replying to his point. Whether there is any disagreement about our figures or not—and I am certain that we can resolve the matter without any real disagreement—the fact remains that this margin of excess is largely accounted for by these Indian troops. A year ago they were, of course, serving in a good many parts of the world outside India; they were serving in many parts of South-East Asia and, to the best of my knowledge and belief, they were also serving at that time in the Middle East and in Italy. The number involved is not large. as the hon. and gallant Gentleman will realise. During the course of the year, they were largely moved out of these areas. We had estimated for a certain number to be left there. In the first week of the financial year there were nearly 65,000 more than we had anticipated. That is the simple and frank explanation of this Vote.
      Resolved:
      "That an additional number of Land Forces, not exceeding 65,000 all ranks, be maintained for the Service of the United Kingdom at Home and Abroad, exclusive of those serving in India on the Indian Estab
      1034
      lishment, during the year ending on the 31st day of March, 1947."
      Motion made, and Question proposed,
      "That a Supplementary sum, not exceeding £50,000,000 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 expenditure beyond the sum already provided in the grants for Army Services for the year."

      SCHEDULE

      Sums not exceeding

      Supply Grants

      Appropriations in Aid

      Vote

      £

      £

      1. Pay, &c. of the Army

      113,570,000

      *— 47,648,000

      2. Reserve Forces, Territorial Army, Cadet Forces, &c.

      Cr 255,000

      —

      3. Medical Services

      Cr 62,000

      *— 230,000

      5. Quartering and Movements

      Cr 23,558,000

      1,442,000

      6. Supplies

      Cr 27,977,000

      *— 5,669,000

      7. Clothing

      Cr 910,000

      70,000

      8. General Stores

      Cr 5,116,000

      375,000

      9. Warlike Stores

      Cr. 2,100,000

      *— 150,000

      10. Works Building and Lands

      Cr 3,865,000

      1,815,000

      11. Miscellaneous Effective Services

      Cr 21,502,000

      762,000

      13. Half-Pay, Retired pay and other Non-effective Charges for Warrant Officers, Non-commissioned Officers, Men and others

      200,000

      —

      15. Civil Superannuation, Compensation and Gratuities

      75,000

      —

      Balances Irrecoverable and Claim Abandoned

      20,000,000

      —

      Total, Army (Supplementary) 1946–47 £

      50,000,000

      *—49,233,000

      *Deficit

      6.15 p.m.
      Mr. J. Freeman: I can now resume the remarks which, in my innocence, Colonel Ropner, I hoped that you would allow me to make on Vote A. The point that I

      1035
      am anxious to put to the Committee by way of opening is that, although this is, on paper, a very substantial sum, and although the Committee will probably desire some explanation, a part of the large sum involved is a matter of accountancy. We have introduced nothing new here. This is money required to implement Government decisions already taken and already notified to the House. The largest single item in this extra expenditure—
      Mr. Stephen: When referring to Government decisions already taken and notified to the House, does the Financial Secretary to the War Office wish to intimate that this money is for something included in the Estimate last year?
      Mr. Freeman: I do not wish to treat the hon. Member abruptly, but, if he would read the Estimate, which is set out extremely fully, he would find the answer to his own question contained in it. I hope slightly to amplify the figures in that Estimate on one or two items. The largest single element of extra expenditure in this Supplementary Estimate is £37 million which has been paid out in war gratuities and postwar credits to Service men and women who are still serving. The Committee will remember that no postwar credit or war gratuity could be earned by members of the Army after the summer of 1946. In the normal way, these benefits have been paid on demobilisation, but, in the case of men and women serving after 31st October, 1946, the Government decided to pay them those postwar credits and the war gratuities into a Post Office Savings Bank account straightaway in order that they might begin to accrue interest at a. date earlier than they would otherwise have done. The total cost of that amounts to £37 million.
      In one sense, this is an increase of expenditure, but I suggest that the Committee can legitimately regard it as a matter of accountancy, in that we have brought forward in this financial year what we should have had to pay in the next or subsequent financial years. I am certain that the fact that we have taken this step will meet the general approval of hon. Members on both sides of the Committee. The fact that the Army has not been able to run down quite as far or as fast as we had hoped during the current financial year—
      Earl Winterton: When the hon. Gentleman mentions the figure of £37 million, does he mean that that figure represents an addition of sums under the different headings?
      Mr. Freeman: Yes, Sir. For the noble Lord's information, what I am trying to do is to give a little extra information about some of these figures. The figure of £37 million is, of course, an extraction from several of the subheads in Vote I. As far as we can extract the cost of the slightly lower rate of release than had been hoped, for, I can tell the Committee that it is in the neighbourhood of £17 million. The Committee is very well aware of the considerations which have led us to take this course, and I can only say that we are seeking to economise in manpower wherever possible. The Committee will, of course, have noted the announcement made last week that we have found it possible, during the course of the next five months, to release an extra 50,000 over what we had originally anticipated.
      I should also like to draw attention to one further substantial sum contained in this Supplementary Estimate. It is the sum of £14 million which, once again, if hon. Members are studying the Estimate in detail, is an extraction from several Subheads. That figure is for the Polish Resettlement Corps.
      Mr. Sydney Silverman: My hon. Friend referred to the Polish Resettlement Corps. I take it that what he really means is Vote 11, Subhead C, £13,300,000. The Polish Resettlement Corps does not exist yet.
      Mr. Freeman: If my hon. Friend will allow me to continue my argument, I think I shall be able to satisfy him on that point. What I was about to explain to the Committee is that the announcement of the Government's intention to form the Polish Resettlement Corps was not made until 22nd May, 1946; that is to say, after these Estimates were prepared. At the time we made our main Estimates for the year 1946–47 we contemplated having on our charge a certain number of Polish Land Forces who would come off our charge at a very early date. During the course of the financial year the decision was taken by the Government, which has been approved by Parliament, that the Polish Resettlement Corps

      1037
      should be formed. As a result, we have had during the current financial year, first of all, a considerable extra element of charge in payment for such members of the Polish Armed Forces as have not yet joined the Polish Resettlement Corps but who have been maintained at the expense of this country for a longer period than was expected. We have also had, and shall incur within the next two months, expenses in connection with the formation of the Resettlement Corps itself. It would be quite impossible, judging from our experiences on the last Estimate which we discussed, to go through this Estimate point by point and answer all the questions which hon. Members oh both sides of the Committee will ask, and unless I go through the Estimate literally Vote by Vote, there will be Members who are ingenious enough to put perfectly fail questions on matters which have not been covered. Since, in the short time I have been in the House, I have been taught that one of the cardinal virtues in moving a Supplementary Estimate is brevity, and since I have beside me my right hon. Friend the Secretary of State for War who is prepared to be "shot at" and answer questions which may be put by hon. Members, I think I had better leave the matter at that, having touched on some of the salient points, and invite the Committee to take these Estimates as they think fit.
      Before concluding, I will draw the attention of the Committee to one point of substantial importance, and that is, as will be observed by hon. Members who have studied the Estimates, that the excesses and savings come very near to balancing one another. I realise that I have to walk the tight rope with great delicacy at this point, but I hope, without going into details, that you will allow me, Colonel Ropner, to point out in passing that had it not been for a failure of appropriations in aid, it would not have been necessary to ask the Committee to grant this Supplementary Estimate.
      Mr. Grimston: I have one or two small points to raise first of all in connection with this Supplementary Estimate before passing on to one very major item which the Financial Secretary has not mentioned at all, and to which I think the Committee's attention ought to be directed. I would like to pass rapidly over the small points that I have to raise
      1038
      The first point is this. Of course, we have no quarrel with the decision to pay postwar credits and gratuities to those who will not be demobilised during the current year. It will, no doubt, help the showings of the savings movement which, from the point of view of the Chancellor of the Exchequer, will be a good thing. But there is one point of detail about which I want to inquire. I presume these figures do not include the demobilisation leave pay and allowances?
      The Secretary of State for War (Mr. Bellenger): Demobilisation leave is only paid for when the men take it.
      Mr. Grimston: That is the point I wanted cleared up. I am obliged to the right hon. Gentleman. The other small point I wanted to raise at this stage relates to an item on page 5, under Vote 5— "Railway stores, &c." I see that the amount asked for is nearly £750,000 more than the original Estimate. With the slowing down of movements and so on which have taken place, I find that figure somewhat strange, and I would like some explanation about it. There is also a very small item on page 9, concerning compassionate gratuities. I would rather like an instance of what those are. I see the figure has gone up from £45,000 to £120,000—an increase of £75,000.
      I now wish to turn to a very large item in these Estimates which has not been mentioned at all by the Financial Secretary. If hon. Members will look at the bottom item on page 9, they will see "Balances irrecoverable and claims abandoned". The amount is £20 million. That is a very large sum of money. In fact, it amounts to the whole of the Supplementary Navy Esimate. On page 11 there is a paragraph which reads:
      "In addition to the increased expenditure brought about by the above changes, it is necessary to make provision for substantial losses incurred on accumulation of surplus marks and schillings in Germany and Austria. On 20th May, 1946, the Secretary of State for War informed the House of Commons of these loses and announced the introduction of the British Armed Forces special vouchers scheme."
      It is very surprising when one refers to this statement which was made to the House, as I will do in a moment, to find that losses to the tune of ₣20 million had been incurred. I do not want to detain the Committee very long, but I must direct their attention to the information

      1039
      which was given to the House by the Secretary of State for War on 20th May, which is referred to in the statement which I have just read. This information, through no fault of the Secretary of State's, I am sure, took the form of an answer to a Written Question. The Written Question was this:
      "To ask the Secretary of State for War whether he has any statement to make with regard to the currency in which troops of B.A.O.R. draw their pay."
      I do not propose to read the whole of the answer, and when I interpolate I will tell the Committee. The answer was:
      "Yes, Sir. Hitherto it has been the practice to pay the troops in B.A.O.R. in the currency of the country in which they are serving. Owing to the scarcity on the Continent of goods generally, and particularly of cigarettes, it has been possible for troops to make large profits in local currency by selling canteen goods to civilians at inflated prices, and to use the proceeds for further canteen purchases, etc. Consequently, the amount of local currency received back by Paymasters from canteens and Army post offices and exchanged by them for sterling or other currency has been more than that issued as pay. Despite the limits imposed on the amount of exchanges for individuals, which have been some check on these practices, Paymasters have accumulated very considerable balances of German marks, which will be a direct loss to the Exchequer."
      Here I interpolate to say that I understand the sort of thing that happens is this—and please let it be understood that nothing I am going to say must be taken as blaming the troops in any way. It is a perfectly natural thing for a man to have done in the circumstances, if the temptation was placed in his way. The troops can go to a canteen and purchase cigarettes for x marks. They can then go outside to the German civilian population and sell those cigarettes for two, three or four times the amount paid for the cigarettes. They can then go back to the canteen and purchase more cigarettes, or they can go to an Army post office and invest the difference in Savings Certificates, or at the Post Office Savings Bank. That is how these losses have occurred. Now I will return to the statement of the Secretary of State for War. He said:
      "I am arranging for the introduction of special vouchers denominated in sterling which alone will be accepted for purchases in canteens, Army post offices, officers' shops and other official organisations."
      Now I will miss out a certain amount of the statement. He went on to say later:
      1040
      "The task of printing and distributing the vouchers is considerable and at least two months will elapse before the arrangements can be implemented. I have, however, thought it proper to inform the House of my plans and at the same time to give the troops this provisional notice of the change."—[OFFICIAL REPORT, 20th May, 1946; Vol. 423, c. 33.]
      6.30 p.m.
      Two things occur to me there. Was the extent to which these losses were amounting realised at the time? Because if so, it seems to me extraordinary that no other steps were taken than to produce a voucher scheme which would take two months to bring into operation, and at the same time give everybody a naive warning that they had better make hay while the sun shone. I think anybody reading this written answer at the time would never have dreamt that a loss between 5th April in the current year and about 20th May would run to the tune of £20 million—or rather two months after when the vouchers came into operation. Prima facie—though I should like to hear some more about this from the Secretary of State—it seems to me this is another instance of the feckless administration and complete inability to grasp the size of a problem for which the Government are becoming renowned. To allow this sort of thing to go on to the tune of £20 million is, I think, most reprehensible and the Government ought to be severely criticised for it.
      What I want to know beyond that is: Is the Secretary of State now satisfied that the voucher scheme he has introduced has, in fact, put a stop to this practice, or are losses still running on account of this particular item? Before we finish with this Vote I hope the Secretary of State will give us some more information, particularly on those points, and. whether as soon as this was found out steps were taken before the present scheme could be brought in to try to put a stop to it. Otherwise, it is a case where the situation has got hopelessly out of hand through negligence on the part of the Government. That was the main point which I wished to bring before the Committee on this matter, and I think note should be taken of it. There are many other points which my hon. Friends will wish to raise, and, therefore, I do not wish to say any more, except to repeat that we really must have some more information from the Secretary of State about this enormous

      1041
      loss of £20 million which is falling on the British taxpayer.
      Mr. Hopkin Morris: I take it I am now in Order in dealing with the matter of reorganisation, which comes under this Vote? I would like to have an assurance from the Secretary of State with regard to the reorganisation of the regiments in Wales itself. There are three regiments, the Royal Welsh Fusiliers, the Welch Regiment and the South Wales Borderers. They are old regiments associated with Wales, of which Wales is proud. It is very important, and a matter of national concern to us, that these regiments should be kept together. But if my information is correct—I should like to have some information from the Secretary of State about this—it is now intended under the system of reorganisation—
      The Temporary Chairman: I think the hon. and learned Member's remarks are more appropriate to the main Estimate. His remarks are out of Order at the moment.
      Mr. Hopkin Morris: If there is to be an opportunity of dealing with this subject on the main Estimate, I accept your Ruling, Colonel Ropner.
      Colonel Wigg: I wish to detain the Committee for a few minutes on the increase on Vote 14 B, which the Committee is asked to pass tonight. If hon. Members will turn to the explanatory note on page 10, in paragraph (e) they will find it stated that as the scheme of re-assessment of retired pay and pensions was only announced in April, it had not been taken fully into account when the main Estimates were prepared. When the Secretary of State for War announced the new scheme he said it applied to officers and men who were in receipt of retired pay or pension before the war and who had either volunteered or been recalled for the period of the emergency. In his statement the Secretary of State said:
      "The retired pay or pension re-assessed as above in respect of war service will be regarded as a new code pension."—[OFFICIAL REPORT, 15th April, 1946; Vol. 421, c. 388.1
      The original White Paper on Postwar Code of Pay Allowances, Retired Pay and Service Gratuities was published, and stated in paragraph 40 that:
      "There is a difference between the Service at present in regard to the liability of Service
      1042
      pensioners to be recalled for service in time of emergency It is proposed that as part of the new scheme a liability to recall for service in emergency should apply to pensioners of all three Services."
      Paragraph 52 of the White Paper makes a definite promise to reassess the pensions of those n.c.o.s who were in receipt of pension before the war, and who served during the war.
      Now I wish to relate my personal case as an n.c.o. pensioner to what I have already said. It is usual for an hon. Member to declare an interest in the Committee, and I am declaring mine. I was an n.c.o. who went to pension before the war, and returned to the Service of my own volition, and served for six years as an officer. In these circumstances my pension was due for re-assessment. I mention in passing, that such is the administration of the War Office in handling pensions that although I have left the Army for well nigh a year I have not yet received a penny. But that is by the way. I also tell the Secretary of State that, in view of the conditions which he intends to attach to my pension I do not propose to take my pension, and I think there must be a great number of ex-officers who will take the same line.
      On 28th November last I received a communication from the Secretary of State for War writing, not from the War Office but from an accommodation address, namely, the Royal Hospital, Chelsea. This is a communication which tells me—and in case anybody thinks I am very rich, let me say it would shock the Committee if I told them how much is involved—that if I am to get an increase of a few shillings a week, as a result of volunteering and serving six years' commissioned service, I must sign the following undertaking:
      "You are asked to state below whether you accept the old pension rate without liability to recall, or the new pension rate with a prospect of liability to recall."
      I was asked to sign a declaration in the following terms, and to address it, not to the Secretary of State for War but the Secretary of the Royal Hospital, Chelsea:
      "I have read your letter offering me an option between pension at the old and the new code rates for service and rank. I understand the choice which has to be made, and that if I choose the new code rate I am liable to recall to full-time military service in emergency."

      1043
      Well, I may have earned the title of "old soldier," but I was not wearing that one without a few further inquiries. So I wrote again, having an idea by this time what was happening, and said:
      "I shall he grateful if you will define more closely the phrase in Form 555 reading 'carry the liability to recall to full-time military service in emergency.' If I accept the liability to recall in what rank and in what Corps am I liable to be recalled?"
      I remembered that there was still an emergency, and if I were not careful I might find myself serving as a private in the Pioneer Corps. I was not in the least anxious to take on such a liability for the sake of a few shillings a week.
      There was a long delay, and then the Secretary of the Royal Hospital wrote and said:
      "I am directed by the Lords and others, Commissioners of this Hospital to inform you that the question of ' liability to recall to full-time military service in emergency ' does not come within the jurisdiction of this office, but should be referred to the War Office."
      So to the War Office I go. Perhaps I ought not to have been surprised, but, eventually, I got a reply—an astounding fact. It said:
      "I am afraid I am not yet able to give you an answer on this point, as the conditions of recall to full-time service of pensioners who accept pensions under the new code are still under consideration."
      Now, this may all sound rather funny; but I think there is not so much fun in it, because there is no section of the community more loyal, more patriotic, than the regular warrant officer or n.c.o.s, and I say it is an insult to these men to slip a quick trick across and get some to undertake writing an obligation for which there is no legal sanction. Particularly when one remembers that the men who are affected by this are, every single one of them, men who volunteered without any question during the war.
      I am not going to blame the Secretary of State himself for this, because that would be unfair, and it would be assuming he knows what is going on in his Department. Nothing could be further from the truth. The facts are that the War Office is up to its old game: "We are now at peace; we are back to real soldiering at last; and we are going headlong back, to 1815 or 1066 or to some other date in the past." Then along comes another war and jerks them up again. This is not
      1044
      good enough, and I am asking the Secretary of State to withdraw and repudiate this document—which means nothing—and to repudiate the insult which he has put upon the shoulders of a patriotic and trustworthy body of men.
      Mr. Martin Lindsay: I wish to support as strongly as I can the plea just put forward by the hon. and gallant Gentleman the Member for Dudley (Colonel Wigg). I do not wish to repeat all the facts he has mentioned, but this is clearly a case which should be looked into. Where the War Office would have been in the last war had it not been for the long-term n.c.o.s and warrant officers who came back, we all know quite well. They came back, and did good service; and only after a good deal of pressure from all parts of the House of Commons, was it finally agreed that their pensions should be reconsidered and raised. It is scandalous that this increase of pension should be given only if they sign this pledge to return to an unspecified rank in an unspecified corps. What they should do in the future, in another emergency, has nothing whatever to do with the service they gave in the past, for which these pensions should be paid
      6.45 P.m.
      Mr. S. Silverman: I want to deal with one substantial point, but before I come to it I should like to say a word about the point raised by the hon. Member for Westbury (Mr. Grimston). Twenty million pounds is a lot of money, and if that really has been the cost to the taxpayers of this country of a black market operated by our Forces in Germany, largely at the expense of the people of that country, then. I think, we should have an explanation, and an assurance that it is to come to an end now. But we should also like to know what is the extent of our liability under it, because I observe that in the Explanation. on page 11, £20 million is said to be only part of the cost. The last sentence says:
      "The Supplementary Estimate provides £20,000,000 to cover such of the losses as were incurred during the current year prior to the introduction of the special vouchers scheme."
      It appears to me that the £20 million is not, the whole of the sum which we are called upon to pay in order to subsidise and support this black market; £20 million is what it cost us in the current year, and I think we should like to know what has been the total cost I am not suggesting

      1045
      that there is anything we can do about it. All we can do about it now, is to pay up; but, at least, we are entitled to know how far it has gone, and I hope the Secretary of State will be able to tell us.
      The point I want to deal with is the item under Vote 11 C, and that is the pay, allowances and certain other expenditure of the Polish Land Forces. I see that the original Estimate was for £13,300,000, that the revised Estimate is for £20,927,000, and that the increase of the revised Estimate over the original Estimate is £7,627,000—not far short of an excess of 6o per cent. I gathered from the Financial Secretary to the War Office that the explanation is a simple matter of dates, and does not involve any question of policy, or, at any rate, not any question of new policy. What he was saying was that the original Estimate of £13,300,000 was on the assumption that the cost of these Forces to the British Treasury would come to an end on a certain date, but that, in fact, it continued beyond that date, and that it is this extra £7,000,000 or £8,000,000.
      I am not so sure. I am not sure that every penny of this increased expenditure has not been illegally incurred. What I should like to know is, on what authority of this House, any money whatever has been spent on the maintenance of the Polish Land Forces, on and after the date on which we recognised the present Government of Poland. I am suggesting that there has been no authority at all. This House agreed, and rightly agreed in the first place, in 1940 to the Allied Forces Act; and, having agreed to the Allied Forces Act, it incurred an obligation, which nobody regrets or repents, to pay for those Allied Forces on our soil and on common battle fields and under our authority. But that was on the basis that they were legitimate—
      Mr. Boyd-Carpenter: On a point of Order. On these Estimates is it in Order for the hon. Member to go back into past history on the subject of the Polish Forces, and to raise difficult and, in my submission, irrelevant questions of international law?
      The Temporary Chairman: I do not think the hon. Member has been out of Order yet.
      Mr. S. Silverman: I have the utmost respect, and, indeed, some affection for
      1046
      the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) who raised the point of Order, and I hope he will not think it disrespectful if I venture to remind him that it is in the strict examination of expenditure on Supplementary Estimates that the House retains its control over the public purse.
      Mr. Boyd-Carpenter: I entirely endorse that sentiment, but the hon. Member himself will appreciate that that duty is the more effectively discharged if it is discharged at the proper time.
      Mr. S. Silverman: I do not think I need dissent from that view, but I should have thought that the proper time to express the view of this Committee, that £8,000,000 of money has been spent by the Treasury without any authority from the House, is the precise moment at which His Majesty's Government come to the Committee and ask for sanction for that expenditure, which is what they are now doing. Having said that, let me go back to my argument. I was saying that in order to distinguish between the rightness of the one and the wrongness of the other, it is necessary for the Committee to appreciate how this expenditure arose, and whether its continuance is authorised or not authorised. What the House agreed to in the main Estimates was to maintain the armed forces of a recognised ally. We said on that occasion that the fact that the Polish Government had been overrun and disrupted, whether it was from the East or West,—and that was what we were considering in 1940—and were unable to apply their own laws on their own soil for their own citizens. should not be used by us to deprive them of this authority, and that we would pay them what was necessary to enable them to do so, subject to certain safeguards and rights of repayment when the time came. The authority of the Government to pay moneys out of the Treasury de pended on that; it depended on it being an amount to maintain the armed forces, of a State which we recognised, with which, we were in diplomatic contact and which was an Ally.
      So far as the Polish Land Forces are concerned, they ceased to exist on the date when we recognised the present Government of Poland and ceased to recognise what used to be called the "London Government." I want to know by what authority we have spent any

      1047
      moneys since that date in maintaining the Polish Land Forces. The Allied Forces Act no longer applies, and if this has not been done under that authority, under what authority has it been done, and what are we paving for, and what are we getting for our money? This cannot be a nebulous matter. We must decide what is the legal standing of this organisation, and what authority there is to pay money to it. It is no longer an Allied force, and if it is not an Allied force, then it must be somebody's private army. Whose private army is it, and when did the Government get authority to pay people' to maintain a private army? If I raise a private army, will the Government pay me? [Laughter.] Why not? General Anders is not even a British subject, and he is no more entitled to maintain an army at the British taxpayer's expense than Sir Oswald Mosley would be entitled to maintain a private army. This is a serious matter I am not saying that we should not recognise our obligations to maintain people who are recognised to be refugees, or that they should be compelled to go back to their countries if they think themselves to be in danger.
      The Temporary Chairman: I think that the hon. Member is now a little wide of the subject. It would not be in Order to discuss the general question of maintaining Polish forces in this country.
      Mr. Silverman: I would not venture to dissent from that Ruling. I recognise that that would be completely out of Order on this occasion. I thought I might be entitled to say as much as I have said, and no more, in order to protect myself against any assumption that I was seeking in some way to disown a proper obligation we have undertaken. What I am saying is that there is no authority to pay one single penny towards the maintenance of a disciplined force subject to no national law and on British soil, which is nothing less than a private army. If the Government want authority for that, they must come down to the House and ask for it. I say that they have not the authority to do it, and that every penny has been illegally spent.
      Earl Winterton: I desire to raise a point of Order in connection with the Explanatory Memoranda to these Supplementary Estimates. I believe it has been ruled by
      1048
      your predecessor in the Chair, Colonel Ropner, that we cannot discuss appropriations in aid on a Supplementary Estimate. I have never seen before such a number of paragraphs devoted to explaining appropriations in aid, and we are now in the extraordinary position that while we can discuss those things in the Explanatory Memoranda which are in Order, we are, owing to the Ruling, precluded from asking a question on any of the last four paragraphs on page 11. I suggest it is most extraordinary that this printed document is before the Committee and we can discuss only a portion of it. In the circumstances, cannot we have a relaxation of the Ruling on the subject of the last paragraphs of the Explanatory Memorandum on page 11?
      The Temporary Chairman: I think not. The paragraphs are given by way of explanation, and previous Rulings debar the Committee from following the course the right hon. Gentleman suggests.
      Earl Winterton: I am glad it should be on record that although this is a Government document which is before the House, we are not allowed to discuss it.
      Mr. John Freeman: Government Departments have the choice to publish or not publish statements, in full, but whatever they do, it does not affect the Rules of Order. It seemed to us to be fitting on this occasion to give the fullest possible explanation for the convenience of the Committee, but that does not affect the noble Lord's rights, or what he can or cannot discuss in the Debate.
      Brigadier Low: Is it not possible to distinguish between appropriations in aid where there is a deficiency, and appropriations in aid where there is a surplus over the original Estimate? I notice that Erskine May states that appropriations in aid.—
      "cannot be reduced in Committee of Supply, nor can the policy of such appropriations in aid, or the services on which savings have been made, if they are due to savings, be discussed."
      In actual fact, the deficiency in appropriations in aid, as shown in this document, results in a considerable charge upon the taxpayer.
      The Temporary Chairman: No.
      7.0 p.m.
      Mr. Stephen: Is it not a Rule that when there is additional expenditure in a Supplementary Estimate the purpose to which that expenditure is to be put can be discussed? That is a point I tried to make when the Financial Secretary was making his speech, but he did not seem to understand me. I take it that we can discuss the additional expenditure which is being asked for in the Supplementary Estimate, but not main policy, which is covered by the appropriation in aid.
      The Temporary Chairman: I think that is correct, but it is hardly relevant to the point which was put to me.
      Earl Winterton: The Explanation to the Supplementary Estimate says:
      "Provision was made in Estimates for the recovery of £9,500,000 from the proceeds of Japanese exports. … It is now unlikely that Army funds will receive receipts on account of this during the current year."
      Is it not ridiculous that we cannot ask the meaning of that last sentence?
      The Temporary Chairman: It would certainly be out of Order to discuss that matter.
      Major Legge-Bourke: Surely, there is a difference between a saving and an appropriation in aid which does not exist? In this case, the Explanation to the Supplementary Estimate says that Japanese exports have not materialised, so there can be no question of saving.
      The Temporary Chairman: A discussion on that matter would he out of Order.
      Earl Winterton: Then do I understand from your Ruling, Colonel Ropner, that although there is an increased burden on the taxpayer it is not possible to ask why that increased burden has been incurred?
      The Temporary Chairman: Not on this Supplementary Estimate.
      General Sir George Jeffreys: I would like, first of all, to raise a point in connection with Vote 1, Subhead H, which deals with pay and certain other cash emoluments of the Auxiliary Territorial Service. The Estimate shows an increase from £3,523,000 to £5,229,000, and I would like to ask the reason for that increase now that the war is over. It was always understood that there would
      1050
      be a considerable reduction following the eight years' excellent service which that Service rendered during the war. Now I come to Vote 2, Subhead B, which deals with grants to County Territorial Army Associations. Here, there is an increase of £125,000, and, again, I ask what is the cause of that increase? Since the Home Guard was wound up, and the Territorial Army had not been reconstituted, the duties of the T.A. Associations have been confined to the maintenance of property and so forth, and there has been no cause for extra expenditure.
      I would now like to mention Vote 10, subhead G, which deals with the hire of buildings. One rather hoped that when buildings had been derequisitioned to a considerable extent there would be a decrease, but there is an increase of £1 million. I am sure the Secretary of State will be aware that, unfortunately, a great deal of damage has been done to requisitioned buildings by troops. Whether that £1 million includes any compensation, or money for repairs, I do not know.
      Now I would like to come to Vote 11, Subheads C and CC, which deal with the pay and allowances of the Polish Troops and of the Polish Resettlement Corps. As the hon. Member for Nelson and Colne (Mr. S. Silverman) said, there is a considerable increase in the expenditure on Polish Forces, and there is an entirely new Vote this year for £4,447,000 for this Corps. That is a considerable sum, and it follows on the very large sums which were spent by this country on the Polish Forces during the war. I do not say for one moment that we did not have full value, while the war lasted, for the money we spent. I know those Polish Forces gave devoted service in many cases but, nevertheless, the expenditure was large, and those Forces are not only being maintained now, but have been maintained for a number of years, at the expense of British taxpayers. As the hon. Member for Nelson and Colne also said, they are no longer Allied Forces and I suggest that we should constitute them as British Forces. There could then be no mistake about expenditure in that case. I suggest, as I have suggested before, that we should form a Foreign Legion into which we could enlist the many efficient members of the Polish Forces. We are short of manpower, and such a step would be of great assistance. Further, it would.

      1051
      be strictly in accordance with precedent, and if we did that we should get solid value for the money we are asked to pay. We should get the benefit of the money we have spent on them, the money which we are now being asked to spend, and the money which it seems likely we shall have to spend in future. Further, it would be good business to make better use of these men that we have been doing up to now. I also suggest that some of them—those who were either unwilling or were not available for further Army service abroad —could be used to supplement our deficiency in manpower and labour.
      I would like to call attention to Vote 13, Subhead E, which concerns the retired pay, etc., of colonels and regimental and departmental officers. This Vote covers only a portion of the retired officers, and shows an increase of £200,000. I would like to ask whether that increase applies to those officers whose retired pay was stabilised in 1935 at 9½ per cent. below the basic rates of the Royal Warrant of 1919? It is a very old standing grievance, frequently brought up in this House, that these officers have not had the amount by which their retired pay was reduced restored to them. I asked a Question in the House last week as to how much it would cost to restore to these officers the amount by which their retired pay had been reduced, and the answer was, £180,000 to £200,000. I notice that this figure is for £200,000, and I am wondering whether justice is at last to be done to these officers. They have been very hardly and scurvily treated in the past, and I hope that this £200,000 is intended to deal with their grievances, and that the Secretary of State will be able to answer the questions which I have put.
      Mr. William Teeling: I propose to deal with Vote I, Items F and G, in relation to civilians at pay and record offices, which shows an increase of £338,000, and civilians attached to regimental units, for which there has been an increase of £1,226,000. I should like some enlightenment as to these figures. I can only take a personal case of which I have knowledge, and it makes me wonder exactly how this money is to be spent and what is really happening. I am referring to the R.E. records which have their offices at Brighton. In 1939, this record office had 80 pay clerks and 60 record clerks and by March, 1946, the number
      1052
      employed was 1,300. The present strength is approximately 750, and the authorised strength for 1st February, 1947, was 590. In other words, there is a surplus of about 160. I find that the first lot to be discharged included no fewer than eight men who are completely disabled as a result of the last war. They are not able to do any other kind of work, and apparently no suitable work can be found for them. I find, however, that among those left behind, are—and I am now quoting from a letter from a constituent on whom I can definitely rely:
      "A husband, wife and daughter, a publican, not an ex-publican, who is still carrying on his business and has done for several years, a newsagent, and a tobacconist with a very considerable income, who, incidentally, has never served in His Majesty's Forces and they have been employed for the past four or five years. Also a retired bank manager, and many others, with incomes that enabled them to come to and from the office in their own cars. There are numerous cases where husband and wife are employed, and married women whose husbands are in good positions outside. There are a number of men who have never served in His Majesty's Forces, and single women, who can also run their own cars, still employed, who could well be dispensed with and absorbed into industry, as the work at present does not warrant such a large staff."
      7.15 p.m.
      Why should these people be entitled to employment, when these eight men, to whom I have referred, are being turned off? Some time ago, I was asked about this matter, and these men were then given temporary work. Now I hear that redundancy notices have been re-issued on 7th February. Here is a letter from one of the men concerned:
      "No doubt you are aware that our redundancy notices were issued on 7th February in spite of the fact that the War Office promised to retain our services, provided we were profitably employed on the entitlement medals work. However, according to them, this job can now wait indefinitely, although the Departments concerned have many thousand of application forms waiting to be despatched."
      The position seems to be that little work has been found for them, while others, who are civilians with practically no war record at all, are being left behind. The answer will probably be that according to the arrangement last year, only 3 per cent. of ex-Servicemen can be employed in Government offices. Surely a War Department should be the Department to employ far more than 3 per cent. of these men? People who are being asked to join the Army will surely want

      1053
      to feel that if they do so, something will be done for them afterwards.
      So far back as 1906, there was a Commission on this particular subject. I quote from Cmd. Paper 2991, of 1906:
      "The Committee recommend that the Government should direct the various public Departments to fill suitable vacancies by ex-soldiers and sailors of good character, and that only in the event of such candidates not being forthcoming were posts to be filled by civilians."
      Today, although we are increasing the amount of money being spent on this Department, we are priding ourselves because we are actually employing 3 per cent. of ex-Service personnel, and yet men like these are being turned out. To my mind that is disgraceful. How do the Government expect people to join up it they feel that when they retire, at the age of 45, there will be no jobs available for them? Surely, Government Departments. and especially the War Department, should do their best to find suitable work for them?
      The Deputy-Chairman (Mr. Hubert Beaumont): I am afraid that I have allowed the hon. Member to go further than I should have done. He is now getting on to policy, which is not under discussion.
      Mr. Teeling: If it is a question of increasing the amount of money for this Department, and if I have a particular case in my constituency, is it not right and proper that when people are being dismissed they should be the people who have not taken any part in the war?
      The Deputy-Chairman: The hon. Member is now getting back to policy. We can deal only with the Supplementary Estimates. What he is now saying is a matter for discussion on the Estimates as a whole.
      Earl Winterton: Surely an hon. Member is entitled to ask why a person has been dismissed?
      The Deputy-Chairman: Yes, and I have allowed the hon. Member considerable latitude, but he is now making a Debate on a subject which I rule is out of Order.
      Mr. Teeing: I bow to your Ruling, Mr. Beaumont. But I know about this case of people who have been dismissed, and that the reasons given for their dismissal was that an agreement was arranged
      1054
      whereby only 3 per cent. of the people employed were to be ex-Service personnel, who were badly wounded during the war. I would like the Secretary of State to explain how it is nothing can be done for these disabled men, while other fit men and women are being kept on.
      Lieut.-Colonel Lipton: May I put one or two points to the Secretary of State for War in connection with subhead F, "Civilians at Pay and Record Offices "? This is a revised Estimate which shows some increase on the original Estimate. It does not emerge very clearly whether this increase represents a policy on the part of the War Department of increasing the number of civilian employees in the pay and record offices, and at the same time reducing the number of Service personnel employed there. It is not clear from sub-paragraph (c) on page 10, how the increase becomes necessary at all. We all know, of course, at a time when demobilisation is proceeding fairly rapidly that there is a very considerable addition to the work of the pay and record offices. It seems to me, therefore, that if demobilisation is slowed down this kind of pressure must inevitably also be slowed down, so that this argument cannot on the face of it be advanced as a satisfactory explanation for the increase that is being asked for now. It may be that other considerations are receiving attention at the moment, in view of Command Paper 6715, which aims at a uniform rate of pay between the Services. Possibly at another time, it will be in Order to discuss some form of unified pay and record system applicable to all three Services with a considerable economy on the present system.
      Brigadier Low: I should like to return to the point made by my hon. Friend the Member for Westbury (Mr. Grimston) in connection with Vote 14. It seems to me to be an indictment of the Government that we have suddenly learned in the last week or so that the British taxpayer is to pay £20 million entirely because of illicit trading that has taken place between, so we are told, members of our Forces and our ex-enemies. Why should it be that, without offering any explanation of the failure to find other sources from which payment of this sum should be made, the Government put in the explanation to these Supplementary Estimates the bold statement that we have now to find £20 million for this current

      1055
      year and by implication, as the hon. Member for Nelson and Colne (Mr. Silverman) reminded us, we might have to find a greater sum later? In passing, I should like to correct an impression which the Member for Nelson and Colne left, and that is that the illicit trade had gone on largely at the expense of the people of Germany. It seems to me completely and wholly at the expense, of the people of Britain.
      On 20th May the former Secretary of State for War made reference to the matter, but we were given no indication that the sum was of this size or anything approaching it. Furthermore, from the very treatment of the statement, it is clear that the right hon. Gentleman's predecessor did not realise the gravity of the situation. He talked quite glibly about two months' delay before the necessary steps, which he advised were essential, were put into force. Therefore, it is clear that there has been a grave case of maladministration. Let us look at the way in which this loss has been incurred. I can say again, it is due to black market operations, as they are known, between members of our Forces and our ex-enemies, and in the course of these black market operations currency was used, which I suppose had been printed by one or other of the occupying Powers. There has been no suggestion that this currency collected in surplus quantities in the hands of the Paymaster, the Post Office and ultimately in the hands of the Exchequer was forged currency I take it, seeing there is no contradiction, that I am right in that, and that, therefore, the currency must have been printed by one of the occupying Powers.
      I would ask the right hon. Gentleman the Secretary of State for War to tell us whether he has approached the other occupying Powers to see if they will bear some of the loss. I should like him further to explain why it is that the collection of the surplus marks must necessarily result in a loss to our Exchequer. Why is it that he and the Treasury cannot find some way of getting over this difficulty? I imagine we could get into complicated arguments on this subject, but surely the Committee knows that if a private bank —and banks still are private—had incurred this loss its Board would have got a great deal more than disapproval from the shareholders. It seems to me to
      1056
      be a case that requires a great deal of explanation from the right hon. Gentleman.
      I should like now to come to a few smaller points which also, in my opinion, require some explanation. If the right hon. Gentleman turns to Vote I he will see that under subhead B there is an increase in the revised Estimate over the original Estimate of 43 per cent. Does that mean that the Army is now 43 per cent. larger than it was estimated it would be at the time when this Estimate was made? In passing, it is curious to note that though there has been a great increase in pay, there is no similar ratio increase in allowances, and perhaps, too, he can make that clear. May I turn now to the payment of war gratuities? Perhaps I should disclose that as an officer I, like many other Members of this House, have a personal interest in this, and we are particularly pleased that these war gratuities are going to be paid. I think that many of us have been wondering for some time when these war gratuities and demobilisation benefits, if at all, were to be paid to hon. Members of this House. The right hon. Gentleman knows that in some cases hon. Members of this House have been released under Class A; in other cases, mainly in cases where hon. Gentlemen are very much younger than the normal Members of Parliament, they have not been so fortunate, and I gather they are not likely to receive anything like the Class A benefits. Hon. Members of this House, who left the Army because they were elected to this House, come under the class of release for special civilian employment, and they were placed on the unemployed list. For them, as indeed for all of us, it is a good thing that these payments should he made as soon as possible.
      7.30 p m.
      Now I come to subhead R, "Bounties for soldiers on special short-service engagements, etc." The right hon. Gentleman is an optimist. He expected to get 25,000 short-service recruits before the end of this financial year. In his last statement to us on the position he disclosed that he had 9,000 short service recruits by the end of the year. With a prescience and foresight denied to some of his colleagues, he seems to have anticipated a state of unemployment which would produce quickly for him 14,000 short-service re-

      1057
      cmits. Perhaps he will tell us why he anticipated a much larger number than appears to be justified by the records at the end of December.
      I turn to the subhead which deals with the Territorial Army County Associations. I reinforce the plea that was made by my hon. and gallant Friend the Member for Petersfield (Sir G. Jeffreys), who asked the reason for the increase in the Estimate. As I understand it, the War Office's revised Estimate caters for the Territorial Army setting up shop on 1st January, but it is now not to set up shop till 1st April, and yet we have to provide a greater sum for the Territorial Army County Associations. I would like an explanation of that increase. I have no doubt that there is some very good reason.
      There axe one or two points I wish to raise in connection with the Poles. Whatever may be the legal or illegal position of the Polish land forces, there can be very little difference of opinion that these payments have to be made while the officers and men of the Polish land forces continue to serve in their land forces or in the Polish Resettlement Corps. In the course of his remarks to the Committee at the opening of this discussion, the Financial Secretary to the War Office implied that the Polish officers and men had been retained for a longer period than had been expected. Has that been a change of policy? If so perhaps he will give us the reason for it? What has happened to slow up the expected rate of release of the Poles from the Polish land forces? In passing, I beg the right hon. Gentleman to dispose of the question of legality or illegality. The matter has been raised over and over again in the House, especially by the hon. Member for Aston (Mr. Wyatt) and the hon. Member for Nelson and Colne (Mr. S. Silverman). It is about time the Government came down on one side or the other. Also under the same head is the item "Payments to India under the Indian Defence Expenditure Plan." I understand that that is payment in respect of Indian troops employed on Imperial duty outside India. Is it not a fact—perhaps the right hon. Gentleman will tell us—that some limitation is imposed upon the employment of those troops by the present Interim Government in India? If that is so, why should the taxpayer of this country be required to pay these
      1058
      enormous sums in future? Perhaps the Minister can give us an answer to the question? As to the general question, we must not be too complacent—I am sure the right hon. Gentleman is not complacent—the fluctuations in budgeting are very marked.
      As the Minister stated at the beginning of this discussion, it may he that if certain sums had been available from other Governments as expected, we should not now find ourselves faced with the necessity to discuss this Supplementary Estimate. Even if it were so, this Paper discloses great changes in Estimates. I should not like this Committee to indicate that they were satisfied. We quite realise the difficulties that there have been. The hon. Member for Nelson and Colne reminded us that it is our duty to examine very closely into every item of expenditure in this Paper. I hope we may get a careful answer to the questions put from this side of the House.
      Mr. Chetwynd: I found the Explanatory Memorandum to these Estimates a very great help. It has enabled me to follow what otherwise might have been a very difficult statement. I welcome the statement by the Financial Secretary that the 37 million pounds in payment of postwar credits and gratuities this year accounts for a substantial part of the increase. In regard to postwar credits, I note that the Explanatory Memorandum states that the credits will be paid, as far as possible, during the current financial year. During the past year I have received a number of letters from men on their demobilisation leave, saying that they have not received their gratuities and postwar credits in adequate time, and I want an assurance that they will be paid before the end of this financial year. I hope that the regimental pay and record offices now have this problem in hand and that they have the necessary staff and account machinery to deal with it. I hope they will speed up the payment so that they may be completed during this financial year. Now that the bulk of demobilisation is over, can the Minister say whether he has been able to transfer from the pay offices and record offices any substantial body of people to more useful work in the Army? I think that is a possibility which should he examined.
      I would be grateful, on Vote 1 (a) and (b), if the Minister could break down the

      1059
      sum of something like £47 million increase in certain pay and emoluments. This appears to be due to the increase in Indian personnel and certain increases in pay not worked out when the Estimates were completed, and also due to the increase in the numbers retained in the Army over what was expected, and if he could, give us more detailed information on that point I should be grateful.
      Earl Winterton: I do not want to make a speech at this period, Mr. Beaumont—I hope to make my main speech if I catch your eye later—but I thought it would be for the convenience of the Committee if the right hon. Gentleman would answer some of the questions put from this side of the Committee. I want to reinforce what has been said by the hon. and gallant Member for North Blackpool (Brigadier Low) and the hon. Member for Westbury (Mr. Grimston). We have a very considerable feeling—if I may have the right hon. Gentleman's attention for a moment —of disquiet at this very serious loss of money—that is what it is to the British taxpayer—in Austria, and it would be for the convenience of the Committee if the right hon. Gentleman, who always treats the Committee most courteously, would address the Committee at this point. Perhaps he would, in particular, refer to the loss of £20 million. I would remind the Committee that £20 million is a fifth of what was generally considered to be the total annual Budget before 1900, yet the Financial Secretary did not deign to make reference to it in the course of his observations.
      The Secretary of State for War (Mr. Bellenger): I should be only too glad to comply with the noble Lord's request, but I wish to make an appeal to the Committee—or I shall at the conclusion of my remarks—to give us this Supplementary Estimate. Obviously I cannot damp down the Debate, but it is more for the convenience of the Committee if hon. Members put their various points and the Minister then replies. It only prolongs the Debate if the Minister is expected to get up on more than one occasion to answer the various points put by hon. Members—
      Earl Winterton: Does the right hon. Gentleman suggest, when talking about prolonging the Debate, that hon. Members of this Committee have not a perfect
      1060
      right to ask questions? What has "prolonging the Debate" to do with it?
      Mr. Bellenger: The noble Lord knows, of course, that hon. Members are quite entitled to speak as long as they can catch the Chairman's eye. I do not wish to interfere with their rights. All I was trying to do was to make the Debate as orderly and tidy as possible. An appeal has been made to me to reply at any rate to that portion of the Debate which has, already taken place. We must remember that we are dealing with an Army which was swollen during the war years and which has still not reached its peacetime proportions No business concern could ever hope to estimate and deal with the vast sums of money with which we are dealing in addition to occasional changes in the Government's policy during the year, and then come out in the end as near as we have done in this year's Estimates. We are asking for a Supplementary Estimate of £50 million. That is not large in relation to the problem and the forces with which we have been dealing. I propose, with the permission of the Committee, to deal seriatim with the points put by hon. Gentlemen on both sides of the Committee. There are quite a number of them, and I hope the Committee will bear patiently with me if I take time in replying as fully as I can. I do not want to weary hon. Members, but all the points have been points of substance.
      The main point of substance has been the loss of £20 million in relation to what one might call speculation by the troops in Germany and Austria, which resulted in the British Treasury being landed with a considerable number of marks and schillings. The hon. Member for Westbury (Mr. Grimston) rightly picked on that point, as indeed, when the matter came to my attention when I was Financial Secretary, it startled me. Although I have had some experience of the agility and, as one hon. Gentleman called it, the "slickness" of the British Army in making a deal and making a profit out of that deal, I was not aware of anything like this. The strictures passed by the hon. Member for Westbury on His Majesty's present Government will not all reach the right mark because, it may interest him to know, a very large proportion—I cannot tell him how much—of these speculations occurred during the time of his own Government or of the National Government which preceded the

      1061
      present one. When our troops went into Germany—
      7.45 P.m.
      Mr. Grimston: The right hon. Gentleman will Observe that the Explanatory Note with these Estimates says that this loss of £20 million arose during the current year. The right hon. Gentleman has been asked whether that is the total loss, and that was the question I was trying to put.
      Mr. Bellenger: Yes, Sir, the loss came into this year because the marks which have accumulated have to be dealt with in this current year, but the actual speculations occurred right from the start when British troops went into occupied countries. I suppose I must condemn any private enterprise operations such as these. It is obviously not right that British troops or anybody else should make a profit out of the British taxpayer and the British Treasury, but the fact remains—I put this to hon. Gentlemen—that when wars happen, all sorts of transactions take place—[HoN. MEMBERS: "Hear, hear."] It is not to be wondered at in view of what I have heard in this House during the war and since about the speculations that went on, not only by troops but by civilian contractors, that when the troops saw the opportunity of making money, they took it. We all regret it and I hope that everyone—
      Earl Winterton: Who are these civilian contractors? Surely we cannot discuss them on this Estimate? If the right hon. Gentleman introduces that subject, we shall have to ask permission to pursue it.
      Mr. Bellenger: Obviously I cannot pursue that point, but the noble Lord knows that these matters have been brought up both during and since the war. I can say nothing more—
      Earl Winterton: What has this to do with the Estimates?
      Mr. Bellenger: —in this Debate, but what I am trying to point out is that it does not lie in the mouths of hon. Gentlemen opposite to condemn British troops because they speculated. They speculated. and speculated wrongly, I quite agree. It should never have been done, and as soon as we found that it was being done we attempted to stop it, and I hope we have successfully stopped it—
      Mr. Grimston: I specifically said that I was not blaming the troops for this, but the right hon. Gentleman has said that this started from the beginning of the occupation of Germany, which was about April, 1945. This Government took office in July, 1945. Three months after VE-Day this Government took office, but they did nothing about this until 26th May, 1946, more than nine months later.
      Mr. Bellenger: Just as the troops were swift in their military operations advancing across Germany they were swift in finding how easy it was to make a profit in this manner, described so ably by the hon. Member for Westbury—
      Mr. Grimston: The Government were extremely slow in finding it out.
      Mr. Bellenger: The hon. Member for Westbury has evidently been let into some of the secrets. As to the point of his criticism that the Government were slow in not stopping it, I would remind the Committee that, when this started, operations were proceeding. Even when operations had finished, as the hon. Gentleman said, in July, 1945, when this Government took office, there was a considerable amount of movement and settling down, and we were the first nation to alter the system of paying out troops either in our own currency or in the currency of the land where they were serving I do not know what American losses have been, but American troops are no slower than British troops at finding a way of making a profit in various ways, and I should imagine their losses had been very considerable.
      We took steps other than that of stopping the German currency payments of the soldiers' wages and, let us be quite clear, not only soldiers' pay, but officers' salaries too, because they all had a hand in this merry game. We took certain steps before that happened to try to prevent these depredations going on at the expense of the British taxpayer. What we did was to limit the amount of German currency which the man could draw to the wages which were due to him. Therefore, if he wanted to convert the German marks it which he was paid at the pay table, as the soldiers were doing quite merrily, by converting German marks into British postal orders and so forth, he was prevented from buying more postal orders or transmitting his German money home, through the British Post Office and by

      1063
      other means, to the amount of money that he was permitted to draw in wages. Then, again, it was only permissible for any soldier to take £10 in sterling out of this country when he embarked for overseas, with the result that he was limited, at any rate in theory, to acquiring German marks to the equivalent of his £10 I will not say that troops did not take more than £10 out of the country, for it Is a very difficult matter, unless one searches every officer and man, to make sure that he is not evading the law. One of the most important steps we took—and we had to take legal opinion before we could take it—was to change the whole basis of currency in which the British soldier was paid, and he is now paid in what are known as B.A.F.Vs. We hope, and we have reason to believe, that these quick money making methods at the expense of the British taxpayer have been stopped. I do not think I need say more than that at the moment except that it was going on in the lifetime of both this and the previous Government, and as soon as we were aware of the large sums involved we stopped it —at least we believe we have stopped it and there are no leakages continuing now.
      Brigadier Low: Before the right. hon. Gentleman leaves that, there is one question—
      Mr. Bellenger: I would appeal to the hon. and gallant Gentleman not to interrupt.
      Brigadier Low: I asked a question which has not been answered.
      Mr. Bellenger: I have a long list of detailed questions put to me by hon. Members, largely on the benches opposite, and I want to deal fairly with them. It means I must limit my remarks on each subject if I am to give them an answer. Otherwise I am afraid I shall be detaining the Committee really longer than they will have patience to listen to me. The hon. and gallant Gentleman knows that I am always willing to give way, but there must be a limit if I am to keep within a reasonable time.
      The hon. Member for Westbury mentioned Subhead G of Vote 5—civilians attached to railway stores. That comes under the heading of "Quartering and Movements" and I think it is a reasonable amount when one considers the large
      1064
      masses of troops we had to move about from different parts of the world. Dealing with the question asked by the hon. and learned Member for Carmarthen (Mr. Hopkin Morris), I am afraid that it is not possible for me to continue his point, though it was a very substantial one, namely the re-organisation of the Army and the reduction of certain infantry battalions. I should be out of Order if I dealt with that, but I quite agree that it may be a very suitable subject for the main Estimates which will be introduced within the next few weeks.
      My hon. and gallant Friend the Member for Dudley (Colonel Wigg), supported by the hon. Member for Solihull (Mr. M. Lindsay), raised the point as to the new pension rates, and the liability attached to them. The hon. and gallant Gentleman the Member for Dudley made an amusing speech, and illustrated his points with his own experiences. I had a good deal of sympathy with him when he was telling us how he was referred from the Royal Hospital, Chelsea, to the War Office and back again, although I think he perhaps elaborated his point about the Secretary of State not knowing what is going on in his own Department to a point which went beyond the reasonable bounds of humour. However, my hon. and gallant Friend seemd to be satisfied with the point he was making. Let me say right away that I will examine carefully the point raised about this increase of liability due to increased pension rates, and I hope it will be possible for me to settle that point with him to our mutual satisfaction.
      Mr. Boyd-Carpenter: And to that of the, House.
      Mr. Bellenger: Certainly, I will also acquaint the House on some suitable occasion with the information I am able to get and, possibly, the decision I shall be able to make. I would remind my hon. and gallant Friend, who made great play with the out-of-date methods of the War Office, going back to 1815 and "1066 and all that," that at least in those days the hon. and gallant Member, if had been alive, would have found no Royal Hospital, no pensions, and, indeed, no War Office. I can only hope, therefore, that the result of my investigations may convince him that we have made some slight advance since the days of 1066

      1065
      My hon. Friend the Member for Nelson and Colne (Mr. S. Silverman) raised a point which queried not only the Supplementary Estimate for the payment of the Polish Land Forces, but also the policy on which that is based, if I understood him aright. I do not propose to answer him tonight; indeed. I doubt whether I should be in Order in doing so on the question of policy, namely, on the legality of making these payments.
      Mr. S. Silverman: I have difficulty in following my right hon. Friend. Policy and legality are not the same thing; they are two totally different questions. Also, I asked him about something which is not merely in Order now, but which would be in Order on no other occasion. I want to know on what authority this Supplementary Estimate was incurred. I do not want to repeat my argument, which I adumbrated at some length. that this liability was incurred on no authority and every penny spent was illegally spent.
      Mr. Bellenger: I would merely say in answer to my hon. Friend that the policy was laid down—
      Mr. Silverman: I am not talking about policy.
      Mr. Bellenger: A policy is either legal or illegal, and the policy we are pursuing of paying these Polish Land Forces arises out of the Explanatory Notes in the main Estimates of 1946 on page 75 where it says this:
      "This Subhead provides for the pay, etc., of the Polish Land Forces serving under British command, pending final arrangements as to their future."
      A certain sum of money was provided under that heading to pay these forces. What we are asking is that an additional sum shall be provided to pay those forces which have continued in existence under British command since the days when the main Estimates were introduced last year.
      8.0 p.m.
      Mr. S. Silverman: Will my right hon. Friend understand—and I feel sure I am right about this—that he cannot justify the illegality of the Supplementary Estimate by saying that the main Estimate was illegal too? What we are concerned with tonight is the Supplementary Estimate, and it is no answer to my argument—if I am right—that the Supplementary Estimate was illegal, to fall back on the
      1066
      main Estimate and say that two wrongs make a right—the main Estimate was illegal, this is illegal, and therefore both must be all right. That seems to me to be the law of the jungle.
      Mr. Bellenger: The hon. Gentleman will put his argument in his own way, and I prefer to put my argument in my way. I am not attempting for one moment to say what he is trying to put into my mouth. I think it would be out of Order to enlarge on the point that has been put to me tonight by my hon. Friend the Member for Nelson and Colne as to the legality of these payments.
      Mr. S. Silverman: What is the legality?
      Mr. Bellenger: I merely say that these men have been paid, and rightly paid, for the good work they have done within the British Army. All I am asking for is an additional sum to pay these men. I hope it will decrease considerably, because we are endeavouring to get these men either to go back to Poland or to settle, through the Polish Resettlement Corps, either in this country or overseas. If the explanation I have given tonight does not satisfy my hon. Friend, I regret it, but I cannot take the matter any further tonight.
      Mr. S. Silverman Mr. S. Silverman rose—
      Mr. Bellenger: I am very sorry to disappoint my hon. Friend, but if he wishes to do so he must take another opportunity of raising this matter. I cannot go any further tonight on that point.
      Mr. Silverman: If my right hon. Friend will not give way, I shall have to follow him in the Debate.
      Mr. Bellenger: As my hon. Friend pleases. The hon. and gallant Gentleman the Member for Petersfield (Sir G. Jeffreys) raised several issues which I shall try to deal with. The first was on Vote 1. subhead H, which concerns the A.T.S. As under subheads A, B and C, the increased payment which is being made, and which we are asking the House to approve. is due partly to the increases in the strength of the Army, and that includes the A.T.S. within the Army, resulting I am bound to admit in part from a certain slowing-down of the release programme in the latter part of the financial year. With regard to Vote 2, subhead B, which concerns the Territorial Army, the increase is

      1067
      not a very large amount when one considers that during the latter part of this financial year, although we shall not start active recruiting for the Territorial Army until 1st April, there has been a lot of administrative work entailed on the part of the county associations in preparing for the 1st April, when we hope to make our main recruiting appeal. The amount involved is not very large in relation to the whole of the Supplementary Estimate, but I think that the hon. and gallant Gentleman will agree with me that it has been well spent.
      With regard to Vote 10, subhead G, which the hon. and gallant Gentleman mentioned, as he rightly anticipated that includes sums due in the way of compensation for dilapidations and so forth, owing to the increased speed with which His Majesty's Government have been derequisitioning private properties which they took during the war. With regard to Vote 13, subhead E, which deals with retired pay, the hon. and gallant Gentleman of course brought forward a matter which he has raised on many occasions in this House, namely, the reduction in retired pay made during what was known as the "economic blizzard" and which was never fully restored to officers. I do not propose to say anything on that matter tonight. I cannot give the hon. and gallant Gentleman the satisfaction he wants; this matter has been thoroughly Debated on previous occasions and therefore I must pass to the next subject, although I regret to have to do it and I know the hon. and gallant Gentleman will regret that I cannot give him the answer he wants tonight.
      Sir G. Jeffreys: I asked whether any allowance was made for that service which he has just mentioned in the increase of £200,000.
      Mr. Bellenger: The hon. and gallant Gentleman is perhaps being a little optimistic. I have to inform him that the £200,000 does not cover the point which he raised and argued so ably tonight, as he has done on previous occasions.
      The hon. Member for Brighton (Mr. Teeling) and my hon. and gallant Friend the Member for Brixton (Lieut.-Colonel Lipton) raised the question of the redundancy of civilians serving in the record and pay offices. I sympathise
      1068
      with the point of view of the hon. Member for Brighton, but the fact remains that the Army is diminishing and must diminish, and therefore the civilian services attached to it must diminish too. The time must arrive when the Army must come down to its peacetime level. Unfortunately that time has not arrived yet, but I think we should be neglecting our duty at the War Office if we did not economise in every possible way we could. Unfortunately it will result in some of the civilians in record and pay offices having to find alternative employment elsewhere, or else, taking advantage of the offers we are making, to transfer to other record offices which we are now establishing in preparation for the new Army which is arising.
      The hon. and gallant Member for North Blackpool (Brigadier Low) mentioned Members of this House who were serving at the time of the Election and who were given the option of continuing to serve in the Army or of not continuing to serve in the Army but to carrying on their Parliamentary duties in this House. If they choose the latter alternative they were relegated to unemployment, and indeed by that method, which is not one over which I have complete control, they did lose certain of their demobilisation benefits. But they were entitled to their war gratuities and, if the hon. and gallant Gentleman has not recovered his yet, I can assure him he could do it. I recovered mine long ago. Of course I got out before he did, but that was probably due to the fact that he, being a much younger man, was able to carry on the active fight longer than I was able. I came to the House earlier than he did and therefore, like him, I lost some of my demobilisation benefits. However, I am not grumbling about that, and I am sure the hon. and gallant Gentleman takes this matter in as cheerful a frame of mind as he possibly can. I hope also that he has not reached such an abject state of poverty that we shall be compelled to grant him some ex gratia payment to keep him going.
      The hon. and gallant Member for North Blackpool also referred to short-service engagements. Vote 1, subhead R, Is purely a bookkeeping entry. We have merely specified it here because the Treasury instructed us to open a special bookkeeping account to show the money spent on bounties for the short service

      1069
      engagements, and on the whole I am bound to say that the short service engagement scheme is going very satisfactorily indeed, especially in relation to officers who are either serving now or who have already left the Service and want to come back.
      Brigadier Low: Could the right hon. Gentleman give us the latest figures?
      Mr. Bellenger: No, I cannot at this moment give the figures out of my head, but this is a matter which could be usefully pursued by putting a Question down on the Order Paper. If that were done should be prepared to answer it. I think I have dealt as faithfully as I can and, I hope, in as full detail as I can, with the points that have been raised by various hon. Members tonight. Considering that we are demobilising something like 700,00o men within this year and the next I do not think one can expect the Army Estimates to be rigidly accurate. From what I have seen of previous Estimates and Supplementary Estimates in this House—I have not seen as many as the noble Lord, of course, but I have seen quite a few—and although I am not claiming for one moment that we have estimated as closely as might have been possible, taking it by and large I think we have done our best. I hope the explanation I have given to the Committee this evening will now enable them to let me have the Estimates.
      Sir G. Jeffreys: Is the Minister not intending to give an answer to the question concerning the employment of Polish troops and the suggestion that they might be embodied in a foreign legion?
      Mr. Bellenger: I have answered the question about creating a foreign legion. It is against the policy of His Majesty's Government to do so, but I think I can say to the hon. and gallant Gentleman and, in fact, to the whole Committee, that the Polish troops who were brought here came only because they had served the Allied cause and fought so valiantly during the war against, in the main, Fascism and Nazism. I think I can say that we are rehabilitating them, either by getting them back to Poland—and I only wish that those who are willing could go hack a little quicker, but the delay is not all on this side—or, in the case of those who do not want to go back, by establishing them in some civilian occupation
      1070
      where they can lift up their heads, look every man in the face, earn an, honest living and Live the rest of their days in peace.
      8.15 p.m.
      Major Legge-Bourke: The right hon. Gentleman has just mentioned the matter of the Poles, and I should like to begin by saying a few words about them. There seems to me to be considerable confusion in the Minister's mind as to the difference between policy and fact, and one now begins to understand much more clearly, "Let us Face the Future." But that is perhaps a little outside this discussion. What I did ask, and what we have not yet had cleared up, is why that original decision was taken to presume that so many Poles were to be able to get back to Poland. We do not know why that decision was ever taken. It was obviously a wrong decision and it appears that there is no possible ground for ever having made the supposition that very many Poles would get back. In view of what has happened today there seems less likelihood than ever.
      I do ask the right hon. Gentleman to bear in mind in connection with this matter that however much money we spend on the Polish land forces, whether or not those forces are legally right, the fact remains that we owe them a debt which I hope the right hon. Gentleman intends to repay. The hon. Member for Nelson and Colne (Mr. S. Silverman) today raised the matter of their legality and was a little surprised to hear the hon. Member for Aston (Mr. Wyatt) state during Question time that the fact that they were illegal has now been definitely established. One now knows who it was who established it. The hon. Member for Nelson and Caine is, of course, entitled to his own opinion, and we had better leave, it at that.
      I want now to turn from the question of the Poles to the other parts of the Estimate. First, with regard to the point originally raised by my hon. Friend the Member for Westbury (Mr. Grimston) concerning railway stores. When he came to reply the Minister said that those stores came under the general heading of "Movement," and referred only to matters connected with the movement of troops. I should like to ask him whether he would confirm that that is really so. The increase is £718,000 and 1 am wondering how railway stores can actually

      1071
      be covered under the matter of movement. Is it a question of the vast pool of railway engines and that sort of W.D railway engine of which, I understand, there is a great surplus in the country lying about doing nothing? Whether it is that type of store or a question of maintaining offices and that kind of thing in railway stations is another matter, and if the Financial Secretary speaks again perhaps he would clarify the point.
      There is also a matter concerned with Vote 13 upon which I should like to ask a question. So many people have chosen a gratuity in lieu of retired pay that an increase of £1,300,00 is shown in the Estimate. I do not know whether we could be given some enlightenment as to why it is that gratuities have been chosen in so many cases, but it does raise the whole matter of the Reserve and I imagine that it might not be in Order to discuss that too deeply tonight. We should, however, bear in mind the whole time the number of people who are going straight out of the Reserve and everything else, and those who are still liable to recall. We have no indication from this Vote as to how many those would be. There is still one very important question which the right hon. Gentleman did not answer, and had he allowed my hon. and gallant Friend to interrupt him it might have saved the Committee a little time. I think it was a very important point as to whether any of the other Allied Powers had had any part in this business of special vouchers.
      Mr. Bellenger: I can answer that point. They have incurred their own losses, which are not part of ours, and they presumably have made their own arrangements.
      Major Legge-Bourke: I am grateful for that information. I was wondering whether perhaps all the special vouchers which are circulating and are supposedly printed by our authorities were, in fact, the only ones, or whether there were some others resembling ours which had been printed elsewhere. I think it is just possible that that might have happened. I was hoping that perhaps the right hon. Gentleman would answer that point and that if the printer has been traced some slight representation might be made—if it has not been made already—to the offending Power. I understand that there is a little doubt over that matter, and I hope that
      1072
      it will soon be cleared up and that whatever is established will be announced to the country.
      Earlier the Minister interrupted my right hon. Friend on the matter of demobilisation leave, and I wonder whether he would consider telling the Committee how great a proportion of those concerned did not take this leave and, if they did not, in how many cases this was as the result of their own choice and in how many cases they were not here to take it? In other words, how many came home after their due date for release? I think it was quite a number, and there were certainly some from East Africa, if the right hon. Gentleman remembers.
      Mr. Bellenger: I think the hon. and gallant Gentleman is confusing disembarkation leave and demobilisation leave. Demobilisation leave arises when a man leaves the Services and goes back into civilian life.
      Major Legge-Bourke: I am grateful to the right hon. Gentleman for that correction, but the fact remains that he said it depended upon whether or not they took demobilisation leave, from which it appears that certain men were refusing to take demobilisation leave. Another point to which I wish to refer is the matter of bounties, which was touched upon by my hon. and gallant Friend the Member for North Blackpool (Brigadier Low). My hon. and gallant Friend referred to the last figures which the right hon. Gentleman has given, and I hope that, before the end of the Debate, the right hon. Gentleman will be able to give us the latest news. I understand that, since the power cut, there has been a considerable increase in the number of men coming back. I remember that very early in this Parliament, the right hon. Gentleman the Minister of Labour said that the one thing he did not want the Army to become was a home for the unemployed. I do not want to get out of Order on this matter. The increase in regard to bounties is an original increase in the shape of £1 million, and I take it that the £1 million is sufficiently much in excess of the figures before the power cut was made to enable a pretty good influx as a result of the bounty. I hope, however, that the right hon. Gentleman will bear in mind all the time that if we simply allow the Army to become a second best to civilian employment, the Army, the country, and the world will

      1073
      suffer. I hope he will make a point of encouraging the British Army to consist of people who are proud to be in it, and not of people who speak about it in rather more derogatory terms, in a way in which even some hon. Members are inclined to do.
      Mr. James Hudson: The Minister took part in the Debate, and made a reply to the speeches that had been made, earlier than he had intended to do by reason of the remarks of the noble Lord the Member for Horsham (Earl Winterton). There were several hon. Members on this side of the Committee who still wanted to speak about a matter on which he partially replied—to me, very partially—namely, the question of the£20million.
      Earl Winterton: May I say that I did not intend any discourtesy to the Minister or to the Committee, but as we had no information on that matter, I suggested that the Minister should give some? I did not suggest he should make a full speech.
      Mr. Hudson: I thank the noble Lord. I am glad that we are now in a better position than we were before to debate the matter. I think it is an appalling situation which has been disclosed. A sum of £20 million has had to come from the public Exchequer to cover illegal dealings in Post Office orders, German marks and Austrian schillings. Apparently there were illegal dealings by many people. Were all of them doing it? I do not think they were. At about the end of the period referred to, in May, 1946, I was in Austria with some other hon. Members, and I heard much comment among soldiers about the fact that this sort of thing had been going on. The comment was in the form of a complaint that some had taken advantage of the situation, while others had not done so. I imagine—and I do not think I am imagining too much—that there cannot have been more than half a million men engaged in the process. I think that half a million men is an extreme estimate of the number of people involved. These half a million people—I think a very much smaller number—have filched from the public Exchequer, on an average, £40 apiece. It is a disgrace that the War Office did not find that out until action was taken in May, 1946. The officials re-
      1074
      sponsible ought to have become aware of it as a result of the dealings in Post Office orders. Any post office engaged in this matter could have related what was taking place—I have no doubt they did—and action could have been taken; yet all the time the illegal process continued.
      We have listened to the Minister describing this business in terms which I could not quite understand. My right hon. Friend may have intended to be more severe than he sounded, but it seemed to me that when he was talking about this "merry game," he would have been better engaged in describing it for what it was, a piece of utter dishonesty carried out at the public expense. I think that Parliament ought to speak quite firmly, and that it may be clear to anybody in the Army who reads the report of this Debate that Parliament has a very definite view with regard both to soldiers and to civilians who filch out of the public purse payments to cover illegal dealings in exchange. I think it is particularly important to say this to those people who are passing to and fro between Switzerland and England and other Continental countries and England at the present time. Certainly, to say it with reference to the Army is of the greatest importance. The Minister made slight references of disapprobation, but I think his references ought to have been very much stronger, and particularly they ought to have been stronger against his own officials for their failure to deal with this thing at a much sooner date. I protest against the dreadful disclosure made by these figures.
      Mr. David Renton: Arising from the remarks of the hon. Member for West Ealing (Mr. J. Hudson), I wish to put a brief question to the Minister in the hope that either he or the Financial Secretary will be able to give an answer. Can he tell the Committee whether, in the course of what can only be described as a very large-scale swindle, any money has been recovered from individual people, including officials, who may have benefited from these transactions?
      Mr. S. Silverman: I apologise to the Committee and to my right hon. Friend the Secretary of State for War if I appear to be over-persistent, but I think that an important issue is involved. The issue is not, as he and some hon. Members opposite appear to think, an issue of policy.

      1075
      That is not the point I raise. Although, as a matter of fact, it is not true that all the money has been spent on maintaining those who fought Fascism, and some of it has been spent in maintaining those who did not. I do not want to discuss that aspect, because I think it is out of Order. I do not want to refer to the question of policy. I endeavoured, to the best of my ability, to argue the point that the money had been illegally spent, and if it was illegally spent, it is a matter of irrelevance to the discussion that it was spent for worthy or meritorious purposes. If the purposes were worth it, if the purposes were such as hon. Members would approve, there is a constitutional method of getting authority for the payment, but that is not my point. I say that this debt was incurred without any constitutional or legal authority, and without the sanction of Parliament. To that point I have had no answer, and it is not good enough for my right hon. Friend simply to say, "Oh, I do not propose to pursue it."
      8.30 p.m.
      My argument may be entirely wrong; I hope it is. I would rejoice in the fact that it was ill-founded, and that there was nothing in it, and that everything had been properly done. But my right hon. Friend has not attempted to refute the argument. Perhaps he does not at the moment know what the answer is. If he does not know, it would be courteous to the Committee to tell us so. I assume, from the fact that he has not endeavoured to say that there was anything wrong with the argument, that there is nothing wrong with the argument. The answer must be that the money was illegally spent. There are ways of putting it right. If the objects were meritorious, the House of Commons is always generous in matters of indemnity. But I am sure no hon. Member will think it a light thing that money should be spent without proper authority, nor that there is anything wrong in raising in the Committee in this way doubts about a question of that kind. I think my right hon. Friend treated the matter too lightly. If there is an answer, let us have it. If there is not an answer, let him say so, and say that steps will he taken to put right whatever was done without authority, and we should all be content with that. We can then deal with the matter of indemnity when we have it before us.
      1076
      It is no good saying, "This thing was illegal, but, as the objects of the payment were meritorious, we need do nothing about it." Charles I paid the supreme penalty for taking that view 350 years ago. I hope we are not going back to that. This is a serious matter, and we are entitled to a better explanation than my right hon. Friend has offered.
      Mr. J. H. Hare: I join the hon. Member for Nelson and Colne (Mr. S. Silverman) in condemning the attitude the right hon. Gentleman took up in answering the very serious allegations made by my hon. Friend the Member for Westbury (Mr. Grimston). He has treated the Committee in a most light and frivolous way. Twenty million pounds is a large sum of money, and when it is lost to the Exchequer entirely as a result of black market operations, it is a matter on which we are entitled to have a full and detailed explanation. The Minister stated that these infringements of the currency regulations occurred from the very start. Those were his words. In other words, they occurred immediately after operations ceased in Germany in May, 1945. It took 12 months for the Government to take, or even to consider taking, effective measures to stop these very serious infringements of currency regulations, which were costing the country money all the time. The House should have been kept fully informed.
      We have heard for the first time that the War Office did take certain other steps. They curtailed postal orders being sent back to this country, and troops were allowed to take only fro into Germany. But these palliatives were obviously quite insufficient. So, in May, 1946, a whole 12 months after the activities started, the Government decided at last to do something to remedy the situation. The announcement that they had taken this decision was presented to the House in the most extraordinary fashion. A question of £20 million was involved, but the best that the then Secretary of State for War could do, was to give an answer to a Written Question saying that under certain regulations he was intending to issue special currency vouchers. He then went on to say that it was going to take two months before he could print the necessary forms in order that this abuse could be checked. I suggest that the present Minister's predecessor was guilty

      1077
      of a very grave lack of efficiency in announcing his decision in such a fashion, and in adopting a very leisurely method of trying to solve the problem.
      The right hon. Gentleman turned in his rather mocking and light-hearted fashion to these benches, and said that it was not for Members on this side of the Committee to condemn the troops for the action they took. We do condemn the troops for the action they took, because they were definitely cheating the country and disobeying the law. We also condemn quite wholeheartedly the Minister responsible. I would suggest that this incident, about which this country is hearing for the first time in any detail, is one other really shocking example of Ministerial inefficiency, so many examples of which we are beginning to see from day to day as a result of the prevent Socialist Administration.
      I will leave that point, but there is one other point which I have been trying to raise in the last two hours. I would ask the Minister to look at Vote 10, Subhead W, which deals with "Services in certain theatres abroad." I do not intend to discuss the decrease in that Vote; I know that I should be out of Order if I did. But I would like to ask the Minister how much of this revised Estimate of £24,288,000 is represented by costs of works and buildings in Palestine. I can only assume that we should in fact expect to see a considerable rise on what we have been spending on those things over the last year. I would like to know whether the Minister can give us some idea of that figure. It is important, because Members on both sides have, for the last year, been much concerned with the conditions with which our troops in Palestine are having to put up. Their camps are really thoroughly disgraceful. We have had assurances, not only from the right hon. Gentleman, but from his predecessor, that efforts were to be made to improve conditions, to build hutted camps and to do away with as many tented camps as possible, to provide such services as electric light, N.A.A.F.I. entertainment, etc. We have been repeatedly assured over the last year that something was to be done. If the Minister could say that he had in fact expended money on that purpose—
      The Temporary Chairman (Sir Robert Young): Will the hon. Member indicate
      1078
      to which part of the Estimate he is referring?
      Mr. Hare: I am referring to "Services in certain theatres abroad."
      The Temporary Chairman: The hon. Gentleman cannot discuss that because that Subhead shows a decrease. There is no supplementary sum asked for in respect of it.
      Mr. Hare: I naturally bow to your Ruling, Sir Robert. I did point out that I was not trying to discuss the deficiency. I was asking the right hon. Gentleman—
      The Temporary Chairman: The hon. Member cannot discuss it at all. Vote 10, Subhead W, shows a decrease, and cannot be discussed.
      Mr. Hare: I naturally bow to your Ruling, Sir Robert. I therefore end by expressing the hope that either the right hon. Gentleman or the Financial Secretary will, in his reply to this Debate, treat this matter of the £20 million that has been scattered to the wind as a result of black market operations, in a manner which is worthy of this House.
      Mr. Boyd-Carpenter: The Minister, in his interim reply and with his customary geniality, dealt with a number of small points but he could have caused this Debate to be less protracted had he addressed himself to answering specific questions on two matters of major importance. Before passing to those questions, I would give the right hon. Gentleman one word of reassurance. The right hon. Gentleman was much upset by the fact that his hon. and gallant Friend the Member for Dudley (Colonel Wigg) indicated that he knew nothing about what was going on in the Department. Let me assure the right hon. Gentleman that his lion, and gallant Friend is Parliamentary Private Secretary to the Minister of Fuel and Power and, therefore, perhaps it is natural that he should be under the illusion that Ministers know nothing whatever about their Departments. The right hon. Gentleman has made no attempt to answer the question put in two most forceful speeches by his hon. Friend the Member for Nelson and Colne (Mr. S. Silverman). The question was whether the continuance of the Polish Armed Forces is or is not legal. The Minister can be certain that that

      1079
      question is not designed in any way to hamper the execution of our duty to these men. Nonetheless, it is the duty of this Committee to be satisfied as to its legality before passing a Supplementary Estimate for the financial maintenance of these Forces.
      The right hon. Gentleman has been challenged more than once on this point. So far he has, most conspicuously, refused to answer. If the right hon. Gentleman cannot come to that Box and give the Committee a definite assurance that the maintenance of these Forces, for which we are asked to vote money, is legal, then it will be obvious to the Committee that the right hon. Gentleman knows that it is not That is not treating the Committee or the country fairly. Before we vote this money we are entitled to know whether or not the object is legal. I appeal to the right hon. Gentleman to prevent the inevitable conclusion that it is illegal and to give chapter and verse for its legality. I do not know whether the right hon. Gentleman desires to rise and do so? [Interruption.] Some hon. Members opposite appear to treat this matter somewhat lightly. I do not intend to be driven from the point by them. The hon. Member for Nelson and Colne realised the seriousness of this matter and the damning impression which the reiterated failure of the Minister to answer a straight question will give outside. I appeal to the right hon. Gentleman to give an answer. The right hon. Gentleman half rose and then thought better of it and relaxed in his seat. Let us hope that when he comes to reply, as I suppose he will, he will give an answer.
      Another matter to which I wish to refer is that of the £20 million. It is fair to say that the right hon. Gentleman and the War Office have not been completely frank in this matter. The statement of his predecessor, in the written reply to which reference has been made, gave no indication of the existence of a major scandal. It indicated the necessity for minor remedial measures. It is astonishing that the Financial Secretary, in moving the acceptance of this Estimate, did not refer to this demand for £20 million to make up for moneys expended as a result of what is obviously a grave scandal. Before we pass this Estimate the Committee is entitled to find out a great deal more about this matter.
      1080
      Indeed, as the hon. Member for Nelson and Colne pointed out, the Committee is in duty bound to find out a great deal more. If this leakage of public money has been continuing over the prolonged period which the right hon. Gentleman indicated, can he say why it was not discovered earlier? Can he indicate whether those responsible in his Department for keeping a check upon these matters knew whether or not this was happening? If they did not, what on earth is the use of a financial Department that is blissfully ignorant of the leakage of £20 million of public money?
      8.45 P.m.
      Either these people in his Department —and he is responsible—knew that this, was happening and did nothing to stop it until £20 million had leaked away, as the right hon. Gentleman says, over a long period, or they knew nothing at all about it. I will ask the right hon. Gentleman this question: Has a court of inquiry into this matter been convened? I know, and many hon. Members on both sides of the Committee know, that if one is in a subordinate position in the Army and one loses half-a-crown, a court of inquiry is instantly convened, and, almost inevitably one is made liable to refund it. This is a case of £20 million. Has a court of inquiry been convened to discuss responsibility for this, to assess the blame and to ensure that future loses will not take place? As has already been pointed out, there is no assurance yet, and the Explanation of the Estimate is to the contrary, that, if we vote this £20 million, there is to be no further commitment. Can the right hon. Gentleman tell the Committee that there will be no further commitments in this respect? This is obviously a matter of very considerable importance.
      Then I hope the right hon. Gentleman can explain a little more fully than he has done how it was that these transactions, regrettable breaches of discipline as they undoubtedly were, resulted in this enormous financial loss. As I understood his statement, it was that, as a result of these transactions, large sums in marks—I assume of occupation marks—had got into the hands of the military authorities—larger sums than were required for the pay of the troops. I want to ask the right hon. Gentleman, if I may have his attention for a moment, these questions: Why are these marks apparently so valueless?

      1081
      Why cannot they be used for necessary expenditure in Germany? Why must they be treated as a dead loss? He has not told us whether they are the occupation marks of the British zone, or of another zone, but they are, presumably, legal currency in occupied Germany, so why is it that they must be treated as a dead loss? There may be a perfectly simple answer to that, but I am suggesting to the Committee that that answer has not yet been given. All that we have been faced with is a bill for £20 million. It has been presented, and I am sure I carry the Committee with me in this, in a manner wholly inconsistent with the manner in which a responsible Minister of the Crown should disclose to the House of Commons, or to a Committee of the House, a major scandal of heavy financial proportions in the Department in which he is the responsible head.
      Mr. Bellenger: Might I make an appeal to the Committee to terminate this discussion, because I understood, when I got up to reply, that the noble Lord the Member for Horsham (Earl Winterton) was asking me to reply to points already put? I endeavoured to do so, perhaps without giving complete satisfaction to one or two hon. Members, but I do not think I can carry this point any further tonight, and, therefore, unless hon. Members have any new points to put to me, I think it means prolonging the Debate unnecessarily.
      As to the other two substantial points raised by the hon. Member for Nelson and Come (Mr. S. Silverman) and the hon. Member for Westbury (Mr. Grimston) on the case of the Polish Land Forces, whether the payment made to them, either in the original Estimate or in the Supplementary Estimate, is legal or not, that point will be decided by the Comptroller and Auditor-General and the Public Accounts Committee of this House, which will have to examine these accounts, and they will be the guardians as to the legality or otherwise of this payment. I cannot, in arguing with the hon. Member for Nelson and Come tonight, satisfy him that it is legal, any more than he can satisfy me that it is illegal It is purely a matter of opinion. I say that the payments have been rightly made to the Polish Land Forces, and that the Comptroller and Auditor-General and the Public Accounts Committee of this
      1082
      House will certainly put the matter in its proper perspective.
      As regards the second point raised by the hon. Member for Westbury, it was pursued by other hon. Gentlemen, including the hon. Member for West Ealing (Mr. J. Hudson), who castigated me for not chastising in words of wrath the British soldier who made some money out of the British Exchequer, I do not deny for one instance that, according to the letter of the Ten Commandments, these men are guilty. But I seem to remember some famous words which start:
      "The quality of mercy is not strained. …"
      I am not offering it as an excuse for these men doing what they did, but it must be remembered that they have for long been underpaid by this country. However, the fact remains that what they did was illegal. I condemn it as such, and as much as my hon. Friends would like me to do. But that does not overcome the main point put by hon. Members opposite, because they said explicitly that they did not condemn the soldier, but only those who did not find out what was going on. If 1 were to explain how this operation proceeded, I imagine that I might be giving some tips to further black market speculators. both civilian and military.
      Unfortunately, it centred in N.A.A.F.I. It was not a question which the War Office could control from day to clay. The goods were sent from this country through N.A.A.F.I., purchased in Germany and Austria by the troops from the canteens —and not only by the troops; there are other forces in Germany apart from the military Forces who have had a share in this—and then sold at enhanced prices to the Germans. The money received was then brought back to the canteens with which to purchase more goods, and so it went on in a snowball fashion. It was only after a period that this could be detected. As soon as it was detected, we made very radical attempts to stop it. In answer to the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) I would say that I think we have completely stopped the traffic, but more than that I cannot say tonight. I hope that, with the further explanation I have given on these two points of substance, apart from the various other points raised tonight, the Committee will agree to this Vote.
      Mr. Pritt: I am very disquieted about the question of the Polish Land Force. I have listened to most of the Debate, if not all of it. As I understand it the Minister's reply is really another way of saying, "They say it is illegal, but I, the Minister, do not think it is I can advance no reasons for saying it is legal, and good reasons have been advanced for saying it is illegal. But, will the House give me the money just the same, because I may be caught later by the Comptroller and Auditor-General." As an excuse for theft, it would not go very far to say, "It is all right; I know that I am stealing your goods, but, sooner or later, I shall be picked up by the police." There are Law Officers in this House who are competent and who could tell the War Ministry in five minutes that it is illegal. But we are asked to sanction an illegality. The argument is, "Sanction it now; we shall be caught later." Surely, the only thing for the Minister to do is to ask for this Debate to be adjourned because he does not know whether the money for which he is asking is lawful or unlawful. I feel very strongly about it.
      Mr. Leslie Hale: I had no intention of intervening in this Debate, but no answer has been given by the Minister, and we are entitled to one. There was a time in the history of this House when expenditure was scrutinised. Tonight, the Minister has asked for two sums of £20 million under two separate heads, each of which represents £2 per head for each family in Britain and each of which represents £60,000 from the town which I have the honour to represent. I am entitled to ask—I am comparatively new to this House and do not profess to know the procedure—what my position would be if, having no explanation as to whether this payment is legal or not, I voted for it, and the Comptroller and Auditor-General decided that it was illegal, and this House refused to pass an Act of Indemnity. Would hon. Members be personally liable or, if not, who would pay for it? If the Minister says, "I shall explain this to the Comptroller and Auditor-General and get his assent," why cannot he say what the explanation of the Comptroller and Auditor-General will be?
      On the other side, which I personally find more disquieting still, we have had no explanation of how that occurs. We have been told that purchases were made from the N.A.A.F.I. and that they were
      1084
      "snowball" purchases. We have not been told why the money was not effective money, or what happened to the marks. I do not often find myself in agreement with the hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter). I think this is the second time in this House that I have found myself in agreement with every word of his speech. The other occasion was on the non-controversial and highly uplifting subject of lawyers. I have served in the ranks in the first world war, and I know what happened to me if I lost a button or the smallest piece of uniform. There was no question about the quality of mercy not being strained. I do not want to go into personal history—it might be out of Order—but I would just add that I would have wakened in the guard room in the morning to face a bleak and doubtful future. The Secretary of State for War says, "Here is £20 million. There has been no inquiry and nobody has been 'on the mat'." No senior officer has said "Why did you not report this matter 12 months before?" No officer of N.A.A.F.I. has said why they were allowing all these purchases of vital commodities of which our own people were being deprived, and why they were allow-this "snowball," as the Minister calls it, to roll down the hill to financial disaster. I think we are entitled to more explanation than we have had. Every one of us here is failing in his duty if he says, "It is only £20 million and we have got into the habit of talking of money without any conception of what it means." We should be failing in our duty, if we did not ask for a fuller explanation than we have had.
      Several Hon. Members Several Hon. Members rose—
      The Temporary Chairman: I think the Minister has given the fullest answer that hon. Members could possibly desire.
      Mr. Grimston: In view of what we regard as the extremely unsatisfactory nature of the Minister's reply, I wish to move to reduce the amount of the Vote by £20,000,000 in respect of the losses sustained under the heading "Balances irrecoverable and claims abandoned."
      I beg to move, "That a sum, not exceeding £30,000,000, be granted for the said Service."
      Mr. S. Silverman: This is a new question. So far we have been considering whether we shall grant the Supplementary Estimate for which the Minister has asked.

      1085
      The hon. Member for Westbury (Mr. Grimston) has now moved an Amendment, and I want to consider what my position is. I have objected to two items. One of them I regard as a completely illegal payment and, so far, I have heard nothing which legalises it. No one can say that the other matter is illegal. This Committee would be legally justified in saying, "However wrong it was, we are going to waive all claims against anybody," and, in fact, it would be wise to waive any claims there may be. I do not see how at this time we can recover any of these amounts from anybody. I would not stand in such considerable embarrassment if an Amendment had been moved to reduce the Vote by the amount of the Supplementary Estimate on the Polish Land Forces, because I am not sure how far the Committee would be justified in voting the Government a sum of money the legality of which has not been defended at all. The other point is quite different. I think we would be quite wrong not to pay this £20 million I think we would be equally wrong not to have the fullest inquiry as to how it came to be lost.
      Mr. Boyd-Carpenter: Before voting it.
      9.0 p.m.
      Mr. Silverman: It will not do to say "Before voting it," because whether we can have it before or after voting it, I hope we will get it somewhere. However, it does not help the right hon. Gentleman not to give him his £20 million. It has to be found somewhere, and it seems to me to be the height of irresponsibility to say "This money has been lost but the Committee are not prepared to make any proposal whatever as to how the debt incurred shall be discharged." That seems quite wrong, and I hope the Committee will not accept the Amendment. If there were another Amendment dealing with the Polish Land Forces we might take a very different view.
      Mr. David Renton: The hon. Member for Nelson and Colne (Mr. S. Silverman) has had very much longer experience and greater knowledge of the Rules of the Committee than myself. But I feel I must take him up on one point. Surely, the purpose of our going into Committee of Supply is so that we may be given reasons by the Government why they wish the Supplementary Estimates to be voted out of the taxpayer's pocket?
      Mr. Silverman: Certainly.
      Mr. Renton: If that be the case—and the hon. Member for Nelson and Colne appears to agree it is so—if we are not convinced by the reasons which have been given by the Government, then we do not vote the Supplementary Estimate which is being asked for. For that reason I should think the hon. Member ought to be in agreement with the Amendment moved by my hon. Friend the Member for Westbury (Mr. Grimston).
      Mr. Silverman: Nevertheless, I think we have to act responsibly. We may be completely dissatisfied—and many of us are—as to how this £20 million came to be lost. But that does not absolve us from the responsibility of considering how the loss is to be dealt with now. The money has got to be and will be paid. When I say that, I am not suggesting that there ought not to be the fullest inquiry into how this came about; I agree there should be. But I think it would be wholly irresponsible for the Committee to decide that the bill should not be paid. The other paint is a wholly different one.
      Mr. Renton Mr. Renton rose—
      The Temporary Chairman: We cannot have argument across the Chamber like this. It is quite out of Order.
      Mr. Renton: With respect, Sir Robert, I gave way to the hon. Member. I will just conclude by saying this. The hon. Member seems to be suggesting that the Government have merely to say that there has been a loss, and the Government should then be given the sum they ask for. I submit that should not be so; and that there should be a satisfactory explanation.
      Mr. Grimston: I am seized of the point which has been made by the hon. Member for Nelson and Colne (Mr. S. Silverman), and we are in a difficulty. But we have not had a satisfactory reply on this matter; there has been no promise of any inquiry. However, in order to put the matter right, I think the only thing that it is possible to do is, if you and the Committee will allow me, Sir Robert, to withdraw the Amendment for the reduction, and to give notice that we shall raise the matter upon the Report stage of these Estimates.
      Amendment, by leave, withdrawn.

    CIVIL ESTIMATES, SUPPLE MENTARY ESTIMATE, 1946–47

      LAW CHARGES
      Motion made, and Question proposed,
      "That a Supplementary sum, not exceeding £40,000, 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 Law Officers' Department; the salaries and expenses of the Department of His Majesty's Procurator-General and Solicitor for the Affairs of His Majesty's Treasury, and of the Department of the Director of Public Prosecutions; the costs of prosecutions, of other legal proceedings, and of Parliamentary Agency."
      Mrs. Braddock: I want to have one or two questions answered. Under Subhead H, "Expenses in connection with the trials of international war criminals," an additional sum of £54,000 is being asked for. I want to take a point of view that is taken very often by the Opposition: I want some more details, in relation to the expenses in connection with the trials. I should like to ask the Law Officer who is to deal with this matter, to give me details of the fees and expenses of the prosecuting counsel in charge of the case. I should like him to specify the people concerned and give details of the expenses, separately. I should also like to know what arrangements were made in relation to hospitality while the trials were going on, and whether the charges were met by the individuals concerned out of the expenses paid, and on what financial basis those arrangements were made. I may want to say something further when I get some information, but in the first place I should like to have detailed information in relation to this matter.
      The Solicitor. General (Sir Frank Soskice): I desire to apologise to the Committee for not being here when this Supplementary Estimate was called. I will endeavour to give the information which is asked. Hon. Members will observe that the £40,000 which relates to the expenses of the trial has been increased to £94,000 in the Supplementary Estimate, making a difference of £54,000. I will endeavour to summarise the position of the total expense of the Nuremberg trial, and to give such particulars as I am able to furnish
      The £94,000 is made up as follows: £63,000 attributable to the Nuremberg
      1088
      trial for the year, March, 1946, to March, 1947; £27,300 attributable to the trial of the Japanese war criminals; and £3,700 attributable to the expenses during the same year of the London Office, which it was necessary to maintain for the purpose of the trial; making a total of £94,000, which appears in the Supplementary Estimate, and which I ask the Committee to approve. These figures, as appears from the terms of the Estimate, are referable only to the year, March, 1946, to March, 1947. They are not the total expenses, and I will endeavour now to supplement them by giving the figures which will bring out the total expenses referable to the Nuremberg trial, the Japanese trial and the London Office
      I take the Nuremberg trial first. Up to March, 1946, or, to be more precise, up to 1st April, 1946, the cost of the Nuremberg trial was £23,600. For the same period, the cost of the Japanese trial was £1,223, and for the London office the cost for the same period was £3,825. I will summarise that, and in my summary I will endeavour to give the total cost of the Nuremberg trial, then the total cost of the Japanese trial, and then the total cost of the London office. The figure for the Nuremberg trial is £90,600, and for the Japanese trial, £28,523, to which I will add an estimated figure of £15,000, which is the estimate of the cost which will be incurred before the Japanese trial comes to an end; that trial is likely to go on until something like July, 1947. The total cost of the London office, which is made up by the addition of the two figures I have given, is £7,525.
      In reply to the hon. Lady, I will endeavour to set out how the figure of £90,600, in respect of the Nuremberg trial is made up. The figure is made up in this way: Counsels' fees, £50,552: cost of the tribunal, £26,800; general expenses, £4,960; and for the German legal expert and staff of translators, £4,354. The balance is made up by an estimated figure of £4,000, which will include the fees of my right hon. and learned Friend the Attorney-General. If the hon. Lady wants to know the details of the counsels' fees, I can give them in respect of each learned member of the Bar employed. There were six learned counsel, and I think I am right in saying that the British delegation was smaller than the Russian and American delegations, and about the

      1089
      same size as the French delegation. The cost of that was: for my right hon. and learned Friend the Member for the West Derby Division of Liverpool (Sir D. Maxwell Fyfe), £22,915; Mr. G. D. Roberts, £12,693; Colonel 11. J. Phillimore, £4,378; Lieut.-Colonel Mervyn Griffith-Jones, £4,193; my hon. Friend the Member for Plaistow (Mr. Elwyn Jones), £4,396; and Mr. Barrington, £1,977. With regard to the fees of my right hon. and learned Friend the Attorney-General, the £4,000 will very fully cover his fees, because a large part of them were incurred after 1st April, 1946, and, therefore, will have to be set off against his salary, and so he will not, in fact, receive it. With regard to the time taken, the trial started in November, 1945, and went on until the end of August, 1946. That, of course, was not the whole time spent by the learned counsel who were engaged in the trial. For example, my right hon. and learned Friend the Member for West Derby had to go to Berlin from 5th October to 15th October, 1945, and he also went to Nuremberg a considerable time before the trial started.
      He was there from 25th October, 1945, until 3oth August, 1946, meaning that he was away from his practice for nearly a wear. The hon. Lady can work out the dates. That, of course, applied in general to the other learned counsel who took part in the trial. It meant that one took six practitioners from their practices and kept them away from their practices for nearly a year, at a time when it was important, having regard to the fact that the war had come to an end, that they should get hack and try to rehabilitate themselves in their profession. The fees I have quoted are gross; that is to say, they include the percentage which they have to pay out to their clerks, so that they get less in fact. than the total amount of those fees.
      9.15 p.m.
      I would add also—and I think the whole Committee will agree—that this was about the most important trial in history. It was of the greatest importance that it should be properly conducted, and that the fullest confidence should be placed in the learned counsel in whose hands the control of the case was put. When the trial started, it was, of course, impossible to estimate the actual time it would take. The fees that were paid were negotiated in the ordinary way, and are not dispro-
      1090
      portionate to the fees which are paid fort cases of that magnitude and that importance; indeed, I think it is perhaps fair to say that there never has been a case equal to that in magnitude and importance, both from the point of view of international relations generally and in the eyes of history.
      The hon. Lady then asked about the position with regard to expenses. There was a very small entertainment allowance which was granted. It worked out, I think, at £55 for the whole time in respect of the right hon. and learned Gentleman the Member for West Derby, and I think it refers to two particular occasions when it was necessary for him, in the course of his duties, to entertain members of foreign delegations. Apart from that, I understand that all the expenses of that sort which he incurred had to come from his own pocket. He had a small messing allowance which, for the year worked out at £65. Those are the expenses. I could give the analogous expenses in the case of all the other learned counsel engaged, but they were about the same sort of amount. I do not know whether the hon. Lady would like me to digest all the other general expenses, all of which were expenses of a very general character which it is difficult to give in detail, except at very great length. Unless she would like me to give them in detail, I will take it she is satisfied with what I have given. The other expenses, of course, consisted in the general arrangements which were made for the conduct of the trial. A large staff had to be there, and elaborate arrangements had to be undertaken for the purpose of the trial which, of course, lasted for the period I have indicated. I hope that this information satisfies the hon. Lady. Those are the facts, and I ask the Committee to say that it feels that the expenditure was justified. I suppose that it would have been possible to save money here and there, but, on the other hand, it was of the greatest importance that the thing should be done properly. I hope the hon. Lady agrees that that is so.
      I would like to say a few words with regard to the other item of increase in order to explain the Supplementary Estimate fully. The other item relates to an increase of expenses under Subhead E; that is to say, the expenses incurred in the conduct of litigation on behalf of

      1091
      various Departments and by the Solicitor to the Treasury in his own capacity. The figure that was put into the original Estimate had of necessity to be, to a certain extent, conjectural. It was not known, or it could not be gauged with complete accuracy at the time the original Estimate was prepared towards the end of 1945, precisely how much litigation would be likely to arise out of the ending of the war.
      It transpired that a good deal more litigation was necessary than had been anticipated. In those circumstances, the estimate figure of £131,000 was thought to be too little, and I ask the Committee to approve the increase of £46,000. I can, if the Committee desire, give the general particulars of the type of increases which were necessary, particularly in the case of the War Office, the Admiralty and various other Departments. There is a long list showing how the increases were necessitated. With regard to appropriations-in-aid, the figure has been increased by £48,000.
      The Deputy-Chairman (Mr. Hubert Beaumont): The hon. and learned Gentleman cannot refer to appropriations-in-aid.
      The Solicitor-General: With that explanation, I ask the Committee to say that the expenditure was justified and to approve it.
      Major Cecil Poole: I am sure the Committee are grateful to the learned Solicitor-General for the detailed statement of expenses which he has given in connection with the Nuremberg trial. I understand that the Nuremberg trial is costing something like £90,000, the Japanese trial £43,000, and there is £7,500, for London offices and general expenditure, making the total charge in the region of £140,000. I want to be perfectly frank and to say that I think that it is money well spent in having rid the world of a lot of very undesirable people, but, at the same time, I fail to see why this charge should fall upon the British taxpayer. I would ask whether this amount is likely to be included in our reparation claims against ex-enemy countries. It may seem ungracious that one should try a man and expect his own countrymen to pay for the trial, but I think that is legitimate in this case, and I do not see why, in our ultimate repara-
      1092
      tion charge, this figure of £140,000 should not be included. I speak only for myself, for I would not like it to be thought that, in spite of the fact that fairly high fees were paid to learned counsel engaged in the prosecution, I think the figures are in any way excessive.
      I am sure that the whole Committee would wish to pay its tribute, as I believe has already been done, to the right hon. and learned Member for West Derby (Sir D. Maxwell Fyfe). Here the major question is, I think, to thank him not so much for what he did, but for undertaking the colossal responsibility which was laid upon him—a responsibility unprecedented in the legal history of this country. I think that the fees, while they may be large, are by no means excessive. In fact the right hon. and learned Gentleman is fortunate enough to belong to a profession in which the fees are high, and, if I may say so, are often excessive. I hope that before this Parliament goes out, something will be done to end very excessive legal charges, but while the scale is what it is, we must be prepared to pay it We all know that the right hon. and learned Gentleman is a poorer man for having gone to Nuremberg and received fees of £22,915, than had he stayed in London, taken the briefs which came along, and built up a practice which he was forced to neglect while at the trial. I believe that the labourer is worthy of his hire, and that he, and all who tool; part in the trial, conducted it so successfully, and achieved such desirable results are worthy of our congratulations, and certainly of the amount of money which is being expended.
      Mr. Marlowe: I am sure the whole Committee will agree with the sentiments expressed by the hon. and gallant Member for Lichfield (Major Poole) that this was money well spent. It is necessary to get it into proper perspective because the hon. and gallant Member fell into the error of drawing attention to the fact that the right hon. and learned Member for Liverpool, West Derby (Sir D. Maxwell Fyfe) had earned £22,000 on this matter. All of us who have anything to do with taxation know perfectly well that that is not true at all. After the expenses had been deducted and taxes taken off, I doubt whether there was £4,000 in it for the right hon. and learned Gentleman It is necessary for that to

      1093
      be made clear, otherwise it goes out that the right hon. and learned Gentleman has been paid £22,000 when he has actually not been paid anything like that sum. No one objects to any hon. Member of this Committee investigating why a sum of money is paid. It is perfectly proper and right that it should be done, but I cannot help feeling that the hon. Lady the Member for the Exchange Division of Liverpool (Mrs. Braddock) who raised this matter did so for the particular purpose of probing what had been paid to the right hon. and learned Member—
      Mr. Leslie Hale: On a point of Order, Mr. Deputy-Chairman. Is it in Order for an hon. Member to allege and impute motives against an hon. Member by name when she does her duty by investigating a subject?
      The Deputy-Chairman: It is quite in Order for an hon. Member to ask the reason or suggest a reason for a matter being raised.
      Mr. Marlowe: I am now fortified in what I originally believed. The hon. Member for Oldham (Mr. Hale) at once began to assume that motives were being imputed. I was not doing so at all—
      Mr. Hale: The hon. and learned Member did.
      Mr. Marlowe: I was stating the very elementary fact, with which the hon. Member for the Exchange Division of Liverpool would agree, that she wanted to find out what the right hon. and learned Member for West Derby was paid. Now she has been told, and I hope she is quite satisfied that the probable net sum of money was in the region of £4,000—a very modest fee to be paid for the great services rendered by the right hon. and learned Gentleman. I remember so well how it was assumed in the last Parliament that everybody who belonged to the Conservative Party was a Fascist beast, and that only hon. Gentlemen who belonged to the Labour Party were anxious to destroy Fascism. Now the hon. Lady is quibbling at the expense of a few thousand pounds spent on this particular purpose. She is quite entitled to make her inquiries, but I have no doubt that she did so for the particular purpose of probing into this matter. I agree with what was said by the hon. and gallant Member for Lichfield that it is money well spent, but it is not so much money
      1094
      as the hon. Lady hoped she would find. [HON. MEMBERS: "Oh."] Everyone will agree that this is a small amount, and also the total includes what was paid to the hon. Member for Plaistow (Mr. Elwyn Jones). It will be agreed that the money was well spent on him as well. This was a small sum for the purpose of finally deciding the guilt of those war criminals, and we ought not to make it the subject for any further inquiries.
      Mrs. Braddock: I am not so politically charitable as my hon. and gallant Friend the Member for Lichfield (Major Poole). I wanted to know exactly what the Labour Government had paid to a Conservative representative. I wanted to know it particularly, because the right hon. and learned Member for West Derby (Sir D. Maxwell Fyfe) has been using the position politically, in relation to the work he has done. Time and time again on the political platform he has made reference to this position, and I wanted to make it perfectly clear in public on the Floor of the House of Commons exactly how charitable in this regard the Labour Government was to a political opponent. I have listened on many occasions from the other side of the Committee to how much Mr. Laski got for giving a lecture to the troops. If we are to talk about 100 guineas for fees for members of the. Labour Party lecturing to anybody, I suggest quite openly and honestly that it I, simply chicken feed in relation to the £23,000 paid as fees and expenses to a Member of the Opposition by the Government at the moment in control.
      I make no bones about it. I made a statement upon the public platform that at the very first opportunity I would ask for the answer that the country was entitled to have. The Member opposite was quite right. I dislike anybody who holds certain opinions. I do not like their faces. I have certainly no intention, whenever I get an opportunity of — [Interruption]—I am not going to adopt in this House anything different from what I have adopted right throughout my years of working class agitation outside. I have no intention of being politically challengeable by anybody who holds views that I consider are detrimental—
      9.30 p.m.
      The Deputy-Chairman: The hon. Lady is now getting rather wide.
      Mrs. Braddock: It may be so, Mr. Beaumont. I thank the Solicitor-General for the information, of which I will make the very fullest political use at every opportunity.
      Mr. Assheton: The hon. Member for the Exchange Division of Liverpool (Mrs. Braddock) has told the Committee candidly what her motives were in asking for this information. I should like to say that there is no-one on this side of the Committee, including my right hon. and learned Friend the Member for West Derby (Sir D. Maxwell-Fyfe), who has the slightest objection to the information being made public. My right hon. and learned Friend took upon himself a task which must have been greater than that laid upon any counsel in any criminal case in history. He bore a burden of immense responsibility in a manner to which the hon. and gallant Member for Lichfield (Major C. Poole) paid tribute. My right hon. and learned Friend discharged those tasks with the greatest possible dignity, and to the satisfaction of the people of this country. With regard to the sum of money paid in fees, it was pointed out by my hon. and learned Friend the Member for Brighton (Mr. Marlowe) that although the gross fees may have been over £20,000 the net amount received by learned counsel was far nearer a matter of £4,000, or something of that order. In addition to that, I know the Committee is aware that my right hon. and learned Friend was absent from this country for about a year and that during that time he neglected entirely his own practice.
      Mrs. Braddock: Did he draw his Parliamentary salary?
      Mr. Assheton: I am afraid I have no idea. Whether he did or did not, I think he was quite entitled to it. If the people of the country learn the facts that have been disclosed tonight, there will be no criticism of the fees that have been paid, and no one will say that this Government who invited my right hon. and learned Friend to take this case, and who settled the fees, were in any way to blame.
      Mr. Osborne: There are two points to which I would call attention. The first surely is that my right hon. and learned Friend was not appointed to do this very difficult and important job merely because he was a Member of the
      1096
      Opposition. The Government appointed the best qualified man. If he had been sitting on the other side of the House he would have been appointed in the same way, and he would have received the same fees. The second point is that if the political spite and hatred which the hon. Lady has shown is typical and characteristic of the party opposite, God help this country.
      Mr. Kendall: I would not have intervened had it not been for the speech by the hon. Lady the Member for the Exchange Division of Liverpool (Mrs. Braddock). It seems to me that the speech made by the hon. and gallant Gentleman the Member for Lichfield (Major Poole) was a very proper speech. I think it is wrong and improper to suggest motives which, presumably, the hon. Lady is going to do on the public platform in regard to the fees received by the right hon. and learned Gentleman the Member for West Derby (Sir D. Maxwell Fyfe) for having done such an excellent job of work at Nuremberg. It would just be as bad if the Members of the Conservative Party suggested that the £4,000, tax free, which has recently been voted for the Prime Minister was given for personal motives. Equally easily, some one could come along and say that the Prime Minister had given himself an increase of something like £150,000 per annum. Nobody has suggested that here, because that would be improper, and I hope that the Committee, without any further ado, will pass this supplementary amount of money asked for by the learned Solicitor-General.
      Mr. Butcher: I am grateful to the Solicitor-General for the clear exposition he has given of the cost incurred for the Nuremberg trial, and I associate myself with the remarks of the hon. and gallant Gentleman the Member for Lichfield (Major Poole). I agree that those who are learned in the law belong to a profession in which the fees seem rather high, but it is news to me that the hon. Lady the Member for the Exchange Division (Mrs. Braddock) is not willing to pay the rate for the job. Surely, that is one of the first principles of all trade unionists, that the right people should be paid the right rate. I believe that the Government were extremely fortunate in being able to secure the services of the right hon. and learned Gentleman

      1097
      the Member for West Derby (Sir D. Maxwell Fyfe), and I have the feeling that if he figures in the big cases in this country with the admirable sense he showed at Nuremberg he will be earning as much as was earned by the President of the Board of Trade.
      Mr. McKie: I would not have ventured to rise to address the Committee but for the speech of the hon. Lady the Member for the Exchange Division of Liverpool (Mrs. Braddock). The hon. Lady told the Committee about certain pledges which she had given on political platforms. Nobody will complain about that, but I should like to remind her when she talks about what she stated on public platforms, that she has made other statements particularly with reference to the procedure of Parliament which could be held against her. I could quite easily—for I have them in my possession—quote to the Committee statements which were made by the hon. Lady—
      The Deputy-Chairman: The hon. Gentleman is now getting out of Order, and if he quotes from the statements which he says he has he will be even more out of Order.
      Mr. McKie: I deplore the hon. Lady's speech, and I have in my possession evidence on which I could, quite easily, have her arraigned for a breach of Privilege.
      Question put, and agreed to. Resolved:
      "That a Supplementary sum, not exceeding £40,000, 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 Law Officers' Department; the salaries and expenses of the Department of His Majesty's Procurator-General and Solicitor for the Affairs of His Majesty's Treasury, and of the Department of the Director of Public Prosecutions; the costs of prosecutions, of other legal proceedings, and of Parliamentary Agency."

      SUPREME COURT OF JUDICATURE, ETC.
      Motion made, and Question proposed,
      "That a Supplementary sum, not exceeding £10, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for such of the salaries and expenses of the Supreme Court of Judicature and Court of Criminal Appeal as are not charged on the Consolidated Fund, and a grant in aid; the salaries and expenses of Pensions Appeal
      1098
      Tribunals; and the salaries and expenses of the War Pensions (Special Review) Tribunals.
      Mr. Butcher: I rise to express the hope we might have such information from the learned Solicitor-General as would enable us to review the progress of the War Pensions (Special Review) Tribunals. This is a matter in which many of us on this side of the Committee take the keenest possible interest, and if he could say how these tribunals are progressing, we should be extremely obliged.
      Mr. Willis: Before my hon. and learned Friend replies. may I ask what is the position with regard to Scotland on this item? There was considerable feeling amongst ex-Servicemen in Scotland when the first of these cases came up for review at Carlisle. Is it intended that there shall be a special review tribunal to deal with Scottish cases? If not, will my hon. and learned Friend give us an assurance that, whenever possible, these cases will be heard either in Glasgow or Edinburgh?
      Mr. Teeling: On a point of Order, Mr. Beaumont, are hon. Members allowed to read newspapers in this Committee? I think the hon. Member for Bolton (Mr. J. Jones) is reading one.
      The Deputy-Chairman (Mr. Hubert Beaumont): It is out of Order to read newspapers here, and if any hon. Member is so doing he or she must desist.
      The Solicitor-General: The position with regard to pensions appeals tribunals is this: the Supplementary Estimate is necessitated by the fact that the number of tribunals which it has been necessary to constitute is more than was anticipated when the original Estimate was prepared. I will give one or two figures in support of that. When the original Estimate was prepared, the number thought necessary was 20. In May, 1946, there were 21 courts. That rose month by month until, in October, 1946, there were 25 courts. In December, 1946, there were 24, and by the end of this month the number should have been reduced to 17 by reason of the back of the work which falls to be done by those tribunals having been broken. With regard to the last question, I understand the position to be that one court, by agreement with the Scottish authorities, will go round the country and

      1099
      will deal with Scottish cases. I believe that is an accurate statement.

      LAND REGISTRY
      Motion made, and Question proposed,
      "That a Supplementary sum, not exceeding £10, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the office of Land Registry."
      Mr. Butcher: Can the Solicitor-General give us an assurance that the staff of the Land Registry is now being increased, so that work on the Land Register, which is now in arrears, and thus causes certain inconvenience to solicitors and their clients, may now be brought up to date?
      9.45 P.m.
      The Solicitor-General: I can give the hon. Gentleman an assurance that the staff has been increased. The estimate for 1946 was 555 and the staff is now 606. I am sorry that I cannot give him the full assurance for which he asks with regard to arrears. Unfortunately, the further press of work upon the Registry has outstripped the extra staff that is being taken on. Hon. Members, of course, know that from time to time questions have been asked with regard to delays in the Land Registry, and every effort has been made by recruiting staff, to cut down those delays.
      There was a considerable amount of success for a time, but when outside firms of solicitors began to get back their staffs the result was a great increase of work, and the extra staff taken on by the Land Registry could not, unfortunately keep pace with it. The estimated amount of increase upon the work done in November, 1945, was 25 per cent.; that is to say, when the original estimate was prepared it was thought that the extra amount of work that would have to be done above the November, 1945, level would be 25 per cent. That, however, has been falsified, and the actual increase is something like 54 per cent. Of course, every conceivable effort will be made to catch up with that additional burden.

      HOUSE OF LORDS OFFICES
      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 Offices of the House of Lords."

      PRIVY COUNCIL OFFICE
      Motion made, and Question proposed,
      "That a Supplementary sum, not exceeding,£10, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Department of His Majesty's most Honourable Privy Council."
      Mr. Osbert Peake: Although this Supplementary Estimate is only for the net sum of £10 I think I ought to make one comment upon its form. This Supplementary Estimate, like all the others which we have been considering and are about to consider, consists of three parts. The first is the heading, the second the subheads, and the third the details of the subheads. In Part II of this Supplementary Estimate we have the item, "Incidental Expenses: Original Estimate £400, Revised Estimate £1,520, Additional sum required, £1,120." That is to say, the amount required for incidental expenses is approximately three and a half times the amount of the original Estimate, having increased from £400 to £1,520. Then we look at Part III of the Supplementary Estimate to see the details which account for this increase, and we find set out the following words: "Incidental expenses: Additional provision required, £1,120" Part III, which is supposed to give us the details of the sum required, gives us no information of any sort or kind.
      This position frequently arises where the heading is "Incidental and travelling expenses," and we usually deduce in that case that the additional sum required is on account of travelling expenses. Here there is no clue at all to the subject of the additional requirement. When we compare this Estimate with some of the other Estimates before the Committee, we find that it is unique. If we turn, for example, to page 24, we find a similar heading in respect of incidental expenses on account of the Supreme Court of Judicature for Northern

      1101
      Ireland. There, however, we were given details; they are incidental expenses and additional provisions for expenses of the Lunacy Office. We have an indication of what the additional sum required is for. I think it would be wrong for the Committee to pass this stage of the Supplementary Estimate when it is served up in this wholly unsatisfactory form and when that part of the Estimate which is supposed to give us some details in fact contains no information at all. I, therefore, ask for some explanation of how it comes that the incidental expenses—quite unspecified—of the Privy Council Office are some three and a half times the original Estimate.
      The Financial Secretary to the Treasury (Mr. Glenvil Hall): The short answer is that the difference between £400 and £1,520has been spent on certain items which were unforeseen when the Estimate was first presented. The travelling and subsistence expenses in connection with the attendance at a sessional committee of an Indian representative came to £608; the books of the Judicial Library Committee were cleaned, and that cost £98; in addition, provision has been made this year for new uniforms for the council chamber keepers, which account for another £50; travelling and incidental expenses of the Lord President and his staff on visits to United States, Canada, Scotland and Ireland accounts for the remainder of the total of £1,120. As the right hon. Gentleman has said, there have been certain savings which we cannot discuss but which bring the net debit down to £10, which I ask the Committee to let us have.
      Mr. Peake: I am obliged to the right hon. Gentleman for giving so clearly the particulars for which I asked, but it would save the time of the Committee if Departments would take note of the fact that it is desirable that in Part III of a Supplementary Estimate they should give us some information to provide a clue as to the need for additional expenditure. I hope that whoever framed this particular Supplementary Estimate will take note of my remarks because we shall invariably ask for information if such Estimates are not given in the proper form.
      Mr. Marlowe: May I ask the right hon. Gentleman whether part of this sum which is attributable to expenses of the Lord President of the Council will be in-
      1102
      cluded in the startling disclosures from platforms mentioned by the hon. Lady the Member for the Exchange Division of Liverpool (Mrs. Braddock)?

      CIVIL SERVICE COMMISSION
      Motion made, and Question proposed
      "That a Supplementary sum, not exceeding if £102,900, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Civil Service Commission."
      Viscount Hinchingbrooke: I hope that the Financial Secretary to the Treasury intends to vouchsafe us a little information about this Supplementary Estimate. I do not desire to go into the sub-headings but I should like the right hon. Gentleman to make reference to Item E and the meaning of the words set out at the bottom of the page:
      "Additional provision required for advertising reconstruction competitions.…"
      It is very satisfactory that the Civil Service should be advertising, and equally so that they should be having competitions, but what exactly is a "reconstruction competition"? Is it some relic from the late Ministry of Reconstruction? It raises ideas in one's mind that possibly these young men and women are being put into some esoteric conclave where they are called upon to devise plans for the brave new world on lines so much desired by hon. Gentlemen opposite. Is it to reconstruct the country according to some grandiose plan, such as Sir Patrick Abercrombie's plans for town and country planning? What are the examinations which these young men and women are called upon to undergo?
      Mr. Osborne: I wish to draw attention to the sum of £19,790 for salaries, etc., for additional staff required for the purpose of accelerating recruitment to the Civil Service. It seems to me that this item makes a good deal of nonsense of other Government publications, especially Command Paper 7018, which states that the country is very short of manpower and that we are in a grave economic position merely because of that. The money we are being asked to vote is for the recruitment of civil servants. We have half a million more civil servants today than we had before the war. We are short of people to carry on productive

      1103
      enterprise. Therefore, this money is being completely and utterly wasted. I understand that various Government Departments have received instructions to cut down their staffs and not increase them; why, therefore, are we being asked to vote £19,790, which we cannot afford, to accelerate recruitment to the Civil Service, which is already overstaffed? If the half million civil servants that we cannot afford to keep were producing at the modest rate of £400 a year industrially, the industrial turnover would be £200 million per annum, and we badly need it. I suggest that, instead of spending all this money on recruiting civil servants, there ought to be a much smaller item, not to recruit civil servants, but to get rid of them. I would like to have a promise from the Financial Secretary that this matter will be looked into.
      Mr. Butcher: I entirely share the view of the hon. Member for Louth (Mr. Osborne) that, in the present state of the country and in the light of the White Paper already issued, and the Government's desire to reduce the number of civil servants, it is a terrible thing that we should be asked to sanction a further expenditure of £102,000 for the expenses of the Civil Service Commission. There seems to be no business-like approach to these matters. Surely, the amount of overhead in regard to examinations does not arise in proportion to the number of people; surely, there is a certain overhead which ought to cover the expenses of these examinations. I cannot help feeling that the Government are being extraordinarily wasteful. It passes my comprehension how, having made an original Estimate of £146,000, that Estimate has been exceeded by more than half as much again, bringing the total up to £250,000 in terms of salaries. I feel that this is not a Supplementary Estimate that ought to be allowed to pass without the most careful explanation from the Financial Secretary. I am sure the Financial Secretary will endeavour to do his best, as he always does, but I believe this matter will tax even his well-known powers of explanation.
      10.0 p.m.
      Mr. Glenvil Hall: I am afraid I was under the impression that hon. Members were more aware than apparently they are of the method which must be employed to bring in recruits to the Civil
      1104
      Service. In the old days, people entered the Civil Service because they happened to know a Member of Parliament or someone high up in the Civil Service. That method has now been abolished.
      Everybody who enters the Civil Service on the establishment side by open competition goes through an examination. In recent years, at least two White Papers have been put before the House, to which the House agreed. The Treasury and Civil Service Commission are bound by the policy laid down in those White Papers. Reconstruction examinations have been set for young men, many of whom have been abroad in the Forces and who would not be sufficiently ready to take the type of examination which they were bound to take before the war. We are, therefore, having reconstruction competitions. That is another word for weeding out by the number of marks obtained people who enter as candidates and wish to come into the Civil Service.
      That is my reply to the noble Lord the Member for South Dorset (Viscount Hinchingbrooke), who asked what these competitions are. If competitions and examinations are held, we must let people know that they are being held, and we must advertise them fairly widely. In addition, we try to hold the examinations in different areas, so that candidates need not come to London for them. In order to help people coming out of the Services into a career at the earliest possible moment, it is only fair to hold examinations at shorter intervals than would otherwise be the case. So we need examiners and various other things are needed for examinations. All that means extra salaries and expenses connected with the work. It does not mean, and I give the Committee this assurance, that we are going to increase the number of people coming into the Civil Service. It does mean that we hope some of those who are now temporary will become established by entering the competitions. It does not mean we are to increase the numbers, but that we are regularising the position by allowing those who want to come in to take the examination and, if possible, to qualify.
      Viscount Hinchingbrooke: I am sorry to press this point, but I would like to know what "reconstruction" means. Is it a Civil Service term meaning postwar, or peacetime? What is the meaning?
      Mr. Spence: I was horrified to hear what has been said by the Financial Secretary. He does not appear to give any assurance to the Committee that the Civil Service is not being increased hand over fist by the recruiting campaign. He referred to the terms of the competition and examinations, but, as far as I could see, that only applies to new applicants. Will he take steps to weed out the rotters who are there at present, and to see that new blood is introduced by the inclusion of ex-Servicemen? Will he clear out the people who are no longer useful to the Service?
      Mr. I. J. Pitman: I would like to draw the attention of the Committee to two possible ways of finding a saving in this direction, which, as well as being a saving, would offer advantages from the efficiency point of view. As I understand it, the Civil Service Commissioners have not really made up their minds whether the new techniques of examination are better than the old. So, to a large extent the two techniques are running parallel. I happened to meet a young girl civil servant who had recently taken the reconstruction examination for admission to the administrative staff. She spoke very highly indeed of the examination, but confirmed what I had previously heard, that the relics of the old examination are still continuing. In other words, they have not really made up their minds yet whether or not they can jettison the old in favour of the new, and they are likely to, keep it going for some time. There is a considerable potential saving there.
      Secondly, I think it would give the new technique a much greater acceptability throughout the Service, if they kept more fully to the basis of the War Office Selection Boards during the war, which was to plant firmly on the shoulders of the people who were to use the staff, the onus of responsibility for selection. It was an expensive mistake, although the man concerned is, in my opinion, extremely good, to have gone to the War Office Selection Boards for a president from the Army. The Army were quite right in having an Army man to select Army personnel. For the purpose of selecting personnel for the Civil Service, it would have been much better to have had a genuine full-time and experienced civil servant, who would have been acceptable to the Civil Service itself. That plan would be a definite improvement and an economy if it were adopted.
      Mr. Butcher: I would say how grateful I am to the right hon. Gentleman, but I am bound to say that all the matters with which he dealt, namely, the discharge of young men from the Forces, the fact that it was desirable to arrange examinations for them as close as possible to their homes, the hope that some at present on a temporary basis would be put on the established scale, are not new considerations. Surely they must have been in the minds of the people who framed this Estimate a year ago? They were not new considerations which would account for the increase. I wonder if I might help the right hon. Gentleman? He suggested that now everybody is subject to an examination on entering the Civil Service, and that it is a great improvement on the days when certain things went by patronage. I would not disagree with him for a moment. All I ask is whether any of these examiners concerned in this Vote are to see that the Coal Board is staffed on a similar basis?
      Mr. Osborne: The right hon. Gentleman has given as an explanation for this increase men coming out of the Services had to be dealt with, and that was why the money was being spent. Will this expenditure diminish proportionately, as and when demobilisation ends?
      Mr. Glenvil Hall: Yes. We are now passing through a special phase, when much which, in the ordinary way, would occupy years to accomplish is being telescoped into a short period of time. It was the decision to do this which is largely the cause of the present Supplementary Estimate.
      Resolved:
      "That a Supplementary sum, not exceeding £102,900, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Civil Service Commission."

    CIVIL ESTIMATES. 1946–47

      MISCELLANEOUS EXPENSES
      Motion made, and Question proposed,
      "That a Supplementary sum. not exceeding £20,000, he 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 certain miscellaneous expenses, including certain grants in aid."
      Mr. Peake: I should imagine that the great majority of Members in the Committee are favourable to the contribution to the National Trust of £60,000, which is the item for which this Supplementary Estimate is presented. But I think that the right hon. Gentleman might be asked to explain to the Committee, quite briefly, why the gross amount of £60,000 is reduced to £20,000 by the "Anticipated Saving on Subhead B (Honours and Dignities—Expenses)."
      The Chairman (Major Milner): I cannot permit an answer to be given to that question. It is a matter of saving which, as the right hon. Gentleman knows quite well, is not a matter which we can properly discuss.
      Mr. Peake: I understood the Ruling given earlier was concerned with the question of appropriations in aid. This is not an appropriation in aid. This is a saving on another Subhead of the Vote which is specifically set up in Part II of the Supplementary Estimate. In my respectful submission the right hon. Gentleman is not precluded from explaining—
      The Chairman: I have made it quite clear that a question of saving cannot be discussed on a Supplementary Estimate.
      Mr. Marlowe: Before we leave the question of the National Trust, there is a matter I wish to raise with the Financial Secretary. I am sorry that his hon. and learned Friend the Solicitor-General has left, because the matter to which I wish to refer is one with which he is familiar. I have not given the Financial Secretary any notice of this and perhaps he will not be as familiar with it as would be the Solicitor-General. Part of this expenditure of the National Trust relates to some land in the South Downs at the Seven Sisters. This a matter in which the hon. Member for Eastbourne (Mr. C. S. Taylor) is interested. We want to know to what extent the Financial Secretary proposes to use any of this money for that land. It is land which is within the National Trust—
      The Chairman: I do not think we can go into details on that matter. The grant is a general one for the National Trust, which deals with it as it thinks proper. I do not think the Financial Secretary can be expected to give details of what
      1108
      is to happen to a specific sum. The National Trust has other moneys. It would be quite inappropriate, on a Supplementary Estimate dealing with a grant to the National Trust, to ask for details of the expenditure of the Trust.
      Mr. Marlowe: May I make this submission? Surely if the National Trust asks for £60,000, part of which is to be spent on particular land in which I and other people are interested, one is entitled to ask the Financial Secretary how the money is to be spent. I fully realise that the Financial Secretary may be in difficulties in answering—
      Mr. Glenvil Hall: Not a bit.
      Mr. Marlowe: Surely, I cannot be out of Order in making my request in regard to that.
      The Chairman: On the contrary, the hon. and learned Gentleman is distinctly out of Order. The proposal is that £60,000 should be granted by way of a contribution to the general fund. Presumably the National Trust has other funds. If this goes to the general fund it is perfectly clear that it is not appropriate to discuss in detail how the funds should be dealt with.
      Captain Crookshank: On that point of Order, It is not unknown that when people give other people money they should earmark some portion of it for a certain purpose. That is frequently the case with the National Trust. Many people have given money to the National Trust and said, "I want my gift to go for a particular purpose." Therefore, is it not in Order for my hon. and learned Friend to ask the Minister whether he has been wise enough in this case to make a donation to the purpose to which he has in mind?
      The Chairman: It may be in Order to ask the Financial Secretary whether the Government have made a contribution for a specific purpose though in fact the Estimate shows that it is a contribution to the general fund. If hon. Members care to put that question I shall not raise any objection.
      10.15 p.m.
      Mr. Marlowe: In order not to waste time, may I put to the Financial Secretary the specific question which my right hon. and gallant Friend the Member for Gains-

      1109
      borough (Captain Crookshank) was good enough to frame? If a particular sum of money is donated to the National Trust for a specific purpose, can one be sure that it will be used for that purpose? Without referring again to the particular piece of land which I have in mind, may I ask the Financial Secretary what safeguard there is by which we can be assured that, if the money is provided under this Vote, the National Trust does not abuse that money by enclosing land which was required to be left unenclosed by the donor? If, for instance, a donor gives a large tract of land to the National Trust with a request that it should be left open, what powers have they to have it enclosed?
      The Chairman: I am sorry, but the hon. and learned Gentleman is going beyond the bounds of Order.
      Mr. Marlowe: I will try not to go beyond the bounds of Order any further, and will leave aside the particular question and ask the Financial Secretary the general question whether the National Trust—
      The Chairman: The hon. and learned Gentleman is still out of Order. The powers of the National Trust do not enter into this at all.
      Mr. Marlowe: I will take only two more sentences, and will not go into the powers of the National Trust. I will just ask what they do with the money, and, surely, I am entitled to ask that? If we vote this money with which I am concerned at the moment, will the right hon. Gentleman ensure that the National Trust will stand by the conditions contained in the bequest?
      Mr. Keeling: As I am a member of the Executive Committee of the National Trust, I may be able to help my hon. and learned Friend, if I am in Order in doing so. This —60,000 was granted by the Chancellor subject to the approval of the Committee, purely in order to double the amount raised by the Jubilee Appeal of the National Trust. The Chancellor promised a pound for every pound subscribed in response to that appeal. Certain members of the public, including, I know, one hon. Member of this House, offered a donation to the National Trust for a particular estate, on the condition that it would attract a pound-for-pound contribution by
      1110
      the Treasury, but the National Trust declined to accept any such sums on that condition, because it was quite clear that the money was being granted by the Chancellor for the Trust's general funds and that no offer of a contribution for a special purpose or a special piece of land could attract a contribution from the Treasury.
      Mr. C. S. Taylor: I am grateful to my hon. and learned Friend the Member for Brighton (Mr. Marlowe) for raising this matter, which, I may say, he had promised to do because I was unavoidably prevented from being in my place by an engagement outside. I oppose the granting of this money to the National Trust, on the ground that the National Trust have not fulfilled the trust which was imposed upon them. I understand that the Attorney-General, who is responsible to this House for the National Trust—if any Minister can be held responsible for the workings of a trust of that nature—has intimated that he is not prepared to use his authority over the National Trust to compel them to do the job which we as hon. Members of this House expect them to do. The area to which my hon. and learned Friend referred was that area of the South Downs known as the Seven Sisters and—
      The Chairman: That is something which happened some little time ago, and it would not appear to have any relation to the present grant.
      Mr. Taylor: With due humility, Major Milner, I suggest that I be given the opportunity of using this illustration to show why, in my opinion, the National Trust is not fulfilling the function which it is expected by the nation to fulfil. This land was given to the National Trust as an open space for all time.
      The Chairman: The hon. and gallant Gentleman is entitled to make general statements but he is not entitled to speak on any particular detailed matter on which he alleges that the National Trust has not carried out the functions entrusted to it.
      Mr. Taylor: If I may, I should like to use this as an illustration of the fact that the National Trust have not fulfilled the functions expected of them by the nation, and for that reason I am opposing the grant of this £20,000. If I may briefly say so, the National Trust allows—
      The Chairman: I am sure that the hon. Member will appreciate that, although he may be brief, he must also be relevant.
      Mr. Taylor: I am trying to explain to the Committee, as shortly as I can, why, in my opinion, the National Trust have not fulfilled the functions that the nation expected from them, and I submit that the argument that I am now putting forward is relevant to that question. The National Trust allowed this area to be fenced off, contrary to the wishes of the donors of that land, and, in this, it seems to me, they have committed a breach of faith to those people who generously—
      Mr. Keeling: On a point of Order. If charges like this are to be brought against the National Trust, I must ask for the right to reply. I think, Major Milner, that you have ruled the discussion out of Order.
      The Chairman: The hon. Gentleman will appreciate the difficulty into which we may get. If he sticks to specific cases, it will involve a discussion of specific cases, and other hon. Members may wish to reply. For that reason, I cannot allow him to continue in his line of argument. He has made a general statement, and he is not entitled to go into particulars or details.
      Viscount Hinchingbrooke: On a point of Order. Your Ruling tonight, Major Milner, makes this Committee virtually inoperative. As I understand it, it is that, if the House has sanctioned expenditure, which forms any part of the total expenditure, even up to 99 per cent., of one of these para-Government bodies like the National Trust, we are precluded from discussing the operations of such a body. In fact, in view of your Ruling, I do not see what we can discuss, except the virtue of giving or not giving this sum of money.
      The Chairman: The noble Lord should not put words into my mouth. However, he is right in saying that the matter is virtually one of giving or not giving this sum. No details of the operation of the National Trust can be discussed in this Debate.
      Mr. Taylor: If I had levelled charges at the National Trust without quoting any specific instance, the Committee would, I think, have had every right to say that my remarks were frivolous. But, as I am in possession of certain facts which show
      1112
      that the National Trust have betrayed the trust imposed in them—
      The Chairman: As I understand it, the National Trust is not under Government control. The Government are not responsible for its detailed operation, and, therefore, details of its operation cannot be gone into. The Government make a contribution to the general fund, and it is open to hon. Members to speak against that if they wish so to do.
      Captain Crookshank: Surely, Major Milner, it is not irrelevant to discuss what is to be done by a body to which this Committee is going to vote money? After all, I understood you to say that all that it is competent for us to discuss is whether or not we should vote the money. Surely, in deciding whether to vote the money it is open to hon. Members to say whether or not they think the organisation to which it is desired to give the money is a good or a bad one. If there are any who know nothing about the National Trust—I do not plead guilty to that because I do know something about it—surely it is relevant that such hon. Members who are reluctant to vote public money for that purpose should adduce reasons for their reluctance.
      Mr. Marlowe: I understood you to rule, Major Milner. that we should not criticise the Government in this matter because they themselves are not spending the money but only handing it over to the National Trust. Are we not entitled to request that when they hand this public money which we are voting to the National Trust, they should ensure that the National Trust do not use it for enclosing land against which there is a condition?
      Mr. Eric Fletcher: May I ask you, Major Milner, whether it is competent for the Committee to consider the policy which will be followed by the National Trust in the expenditure of that money which the Committee is being asked to vote?
      Mr. Butcher: Is not the hon. Member for Eastbourne (Mr. C. S. Taylor) entitled to adduce as an argument to show why this money should not be granted, that the body to which it is proposed to grant the money have, in certain conditions, not discharged their duties?
      The Chairman: The Committee will appreciate that this is an item in a Sup-

      1113
      plementary Estimate and not a main Estimate—
      Captain Crookshank: It is a new service.
      The Chairman: It may well be a new service, but we shall get into difficulties if we discuss in detail the operations of a body to which it is proposed to make a contribution, and for which body the Government have no responsibility. In general terms, yes; but in detail, no; or the discussion would resolve itself into a discussion of the operations of that body and not of the desirability or otherwise of voting the money.
      Captain Crookshank: On that point, does not the fact that this is a new service entirely alter the situation? This is not a Supplementary Estimate. It comes among the Supplementary Estimates, but there is no estimate for this purpose in the main Civil Estimates. Therefore, I put it to you, Major Milner, that, according to all precedents, the whole subject is at large.
      Mr. Glenvil Hall: Perhaps I might help the Committee here. The Committee will remember that, during one of his Budget speeches last May, the Chancellor of the Exchequer indicated that he would, if the House agreed, make a grant from the Exchequer to the National Trust on a pound-for-pound basis to assist it in its jubilee appeal. So far as I know, in no quarter of the House was exception taken to this proposal at that time. In October, when my hon. Friend the Member for Accrington (Mr. Scott-Elliot) asked the Chancellor whether he was going to implement his promise, he indicated that the amount he was going to give was £60,000, which at that time roughly approximated to the amount which the jubilee fund had received. Again, no one in any quarter of the House objected. We have assumed, and I hope quite rightly, in spite of what has been said tonight about the National Trust, which is doing a great work, that it is the general wish of the Committee that this money should be voted. It is true that the payment has not been made before. In that sense, it is, as the right hon. and gallant Gentleman the Member for Gainsborough (Captain Crookshank) has said, something new, but, nevertheless, it is a payment which, in my sub
      1114
      mission, Parliament has agreed to, in view of what has happened during the past year. That is why we take it that the Committee generally would like this expenditure to be made, and why we are now asking for it.
      10.30 p.m.
      Mr. C. S. Taylor: I think, generally speaking, that the National Trust do good work. On the other hand, I hope that the right hon. Gentleman will bring to the notice of the National Trust the extreme dissatisfaction which some hon. Members of this Committee feel over the particular case that has been quoted against the National Trust as showing that it has not fulfilled the trust reposed in it by the nation.
      Mr. Butcher: Before this sum of £60,00 is granted to the National Trust I would like to ask the Financial Secretary if steps will be taken to ensure that the Government have some voice in its expenditure. After all, £60,000 is a very substantial contribution on a pound for pound basis. The Chancellor of the Exchequer made the statement to which reference was made earlier, and I, for my part, would not take any exception to the granting of this money if I felt sure it would be applied in accordance with the wishes of this House. Therefore, I ask the right hon. Gentleman whether it is a condition of the making of this grant that there should be representation upon the governing body of the National Trust. I say to him, as a man born in Sussex that I view the behaviour of the National Trust in the case referred to with the gravest misgiving, and I do not feel the right hon. Gentleman has been as careful as he might have been in the national interest, in granting this large sum of money unless he has some voice to decide how it is expended. I would also ask the right hon. Gentleman whether I am correct in thinking that this sum will not be subject to audit by the Auditor General; that it is a grant and. once it has been granted, we lose complete control.
      Mr. Glenvil Hall indicated assent.
      Mr. Butcher: The right hon. Gentleman assents. In that case, all I can say is that if we have no control over the money once it has been granted, then we must impress upon the National Trust that they should see that this money is-

      1115
      expended entirely in accordance with the wishes of the vast majority of this House
      Resolved:
      "That a Supplementary sum, not exceeding £20,000, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March 1947, for certain miscellaneous expenses, including certain grants in aid."

      SCIENTIFIC INVESTIGATION, ETC.
      Motion made, and Question proposed,
      "That a Supplementary sum, not exceeding £23,140. 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 sundry grants in aid of scientific investigation, etc., and other grants."
      Mr. Peake: I think, even at this corn paratively late hour, the Committee ought not to vote money without having the slightest idea of what it is doing. There are two small items in this Supplementary Estimate about which we ought to have a little information. The first is the grant in aid—for which nothing was provided in the original Estimate—of £1,800 in aid of the Scott Polar Research Institute I think hon. Members ought to be told what that Institute is, why a grant is being made to it, and whether it is the North Pole or the South Pole which is here concerned. That grant in aid, we are told, will not be audited by the Comptroller and Auditor-General. Then there is the grant in aid, under Sub-head V, for the North Sea Fisheries Investigation of a sum of £1,040 for which no original estimate was made. The explanations in the de tails of this sum of over £1,000 for the North Sea Fisheries Investigation is that it is a contribution to the International Council for the Exploration of the Sea I hope that the right hon. Gentleman will tell us what that Council is, where it sits, how often it meets, and which of the Seven Seas it explores
      Viscount Hinchingbrooke: I would like to ask one question with regard to Subhead S. There is a revised estimate for £350,000 for the Arts Council of Great Britain. Is that the total sum, or is the budget to be larger than that? Furthermore, where does the extra money come
      1116
      from? This, I suggest, is another of these para-Government bodies, whose operations do not come before this Committee to any great extent. I understand that the Estimates Committee is precluded from full examination of the affairs of the Arts Council, and although a footnote to the Estimate states that the accounts are audited by the Comptroller and Auditor General, his concern is free to range far and wide for what it wants, and to come to this Committee for public money without a great deal of discussion or examination being involved. I think we are entitled to ask first whether the budget of the Arts Council is settled in detail with the Treasury; secondly, whether this is the total amount of the Council's expenditure, and thirdly, whether this organisation presents an annual report to the Treasury, a report which can be laid on the Table of the House and debated, if necessary. I think these are points which should have an answer.
      Colonel Gomme-Duncan: I wish to ask one question also on Sub-head S with regard to the Arts Council for Great Britain. I see that this body undertakes the duties formerly performed by the Council for the Encouragement of Music and the Arts. This is a most admirable thing, but I want to know, where does music come into this? The previous Council was for the encouragement of musk and the arts; this other body is to take over the duties previously performed by it, but music is not specifically mentioned.
      Mr. McGovern: Is it "Music while you work "?
      Colonel Gomme-Duncan: The hon. Member is naturally interested in the same form of music as myself. But what I want to make clear is that we are giving extra money to this Council, and I want to know if music is going to he left out in favour of the other arts.
      Mr. Butcher: I should like further information about this North Sea Fisheries Investigation. Is it concerned with investigations which will be a real help to my constituents, who border on the Wash? We have had trouble in recent months in regard to mussel fishing, and I wonder if this Board's investigations are intended to aid and assist my constituents to bring these delicacies to the London market in proper condition. Can

      1117
      the Financial Secretary tell us what are the investigations of this organisation? As regards the Scott Polar Research Institute, I think the details in the Vote add little to the information already given us. I do not doubt that the right hon. Gentleman who is to reply will be able to give us a thrilling story of heroism and bravery, but I would like to know more.
      Finally, I come to Subhead S concerning the Arts Council of Great Britain. I think that it is time this Committee reduced the grant of money to this peculiar body, which seems to appoint its own controllers and governors, which receives substantial benefits from public funds and the accounts of which are not presented to this House. There are all sorts of extraordinary stories heard about this Arts Council. Certain theatrical tours overseas have its blessing; others have not. We are entitled to considerably more information about this Arts Council, what it does, and why it should need £30,000 more this year than it did 12 months ago. I hope that the right hon. Gentleman will have realised how extraordinarily reluctant this Committee is to make these substantial grants to many of these hybrid bodies. I think the time has come when we must insist on far more detailed accounts on all matters of public expenditure.
      Mr. Glenvil Hall: Three questions have been put to me, centring on S., SS., and V. The first one related to the Scott Polar Research Institute. This Institute was founded, and is financed, by the balance which remained from the Mansion House Fund which was raised in 1912 in memory of Captain Scott and his companions. The Institute uses the money for Polar research, and it has, down the years, done remarkably good work for this country, and, indeed, for scientific exploration and knowledge generally. A few months ago it was pointed out to the Treasury that the work done by this Institute would suffer if some kind of assistance were not given to it, and we were pressed by the three Service Departments and by the Inter-Departmental Polar Committee, of which Sir Alexander Clutterbuck is chairman, to see what could be done to assist this particular organisation. After examining its financial position, we decided that it would be a good thing if a grant-in-aid to assist it in carrying on its work could be made. The Treasury thereupon
      1118
      agreed to the amount of £1,800, which appears in this Supplementary Estimate. The work which the Institute does is excellent, and I am sure that the Committee would desire the Institute to continue with its researches.
      Captain Crookshank: What does it do?
      Mr. Glenvil Hall: It carries out all kinds of research in the Polar regions, dealing with the various types of fish and mammals found there, with temperatures, arid with all the various things which mankind should know about those regions. [HON. MEMBERS: "What about the other things?"] I do not desire to detain the Committee unduly, but I ought perhaps to say a word about the North Sea Fisheries Investigation. This particular body whose headquarters are situated in Copenhagen, has been in existence for at least 30 years. During the war, owing to the occupation of Denmark by the German forces, we lost touch with it. Since the war ended, it has been thought proper that this country should renew its affiliation, and start once again to pay the grant-in-aid which was paid to this body before the war. The amount we pay yearly is 20,000 Danish kroner, and it has been decided that, as from this year at least we should pay the amount. We have agreed--subject, of course, to the agreement of Parliament—to pay this amount for the next five years. This body carries out investigation in the North Sea, and all the various nations bordering thereon take part in its work. I hope the Committee will agree to our continuing to be associated with this good work.
      10.45 P.m.
      Colonel Gomme-Duncan: May we have an answer to the two questions on Subhead S, which were asked by my hon. Friend the Member for South Dorset (Viscount Hinchingbrooke) and myself? They were perfectly reasonable questions.
      Mr. Glenvil Hall: The £30,000 extra grant to the Arts Council is to assist the Covent Garden Opera Trust in its work, which I think the Committee will agree is music.
      Lieut.-Colonel Elliot: Opera.
      Mr. Glenvil Hall: It was pointed out by the Arts Council that this particular body was well deserving, but that it had got itself into financial difficulties; and after investigation we agreed—and I hope the

      1119
      Committee will also agree—that a further sum of £30,000 should be granted to the Arts Council, which in turn could be passed on to the Covent Garden Opera Trust for this work.
      Captain Crookshank: I should like to make one comment on the right hon. Gentleman's speech, and that is, to call the attention of the Committee to how history repeats itself. In 1930, when the country was in grave danger from unemployment, I remember making a speech, of which I have been reminded this evening in the Committee, on what the Government intended to do to remedy that desperate situation. You will remember, Major Milner, that one of the main contributions was a proposal to grant a subsidy to grand opera. We understand from the White Paper on economy, which is due to appear, that the nation is in considerable difficulties at the present time. We are all certainly aware that as a result of the desperate fuel shortage there are over two million people out of work in this country today. And the same solution is offered by a Socialist Government, namely, asking this Committee for a subsidy for grand opera.
      Several Hon. Members Several Hon. Members rose—
      The Chairman: I hope the Committee will soon come to a decision.
      Mr. Osborne: I wish to ask a question on Subhead V, North Sea Fisheries Investigation. Part of my constituency is interested in Grimsby, and we are very interested in North Sea fisheries. Does this Council actually control the condition of catchments in the North Sea?
      Mr. Glenvil Hall: No, of course not.
      Mr. Butcher: I have a feeling the Committee is making admirable progress in its work of extracting information from the Government. If the right hon. Gentleman had not been pressed repeatedly on this particular Estimate we should not have been able to secure from him the interesting and astonishing fact, that the people of this country are required to subsidise grand opera at Covent Garden to the extent of £30,000. It is the sort of thing which I, for my part, would not like to have to justify to a body of agricultural workers or miners. It is very easy for right hon. Gentlemen opposite to be free
      1120
      with money here. But the money is coming out of the pockets of the ordinary working people of this country. There is really no justification for expecting the miners, who are working so gallantly for the country at this—[Interruption]—I am afraid, Major Milner, that if I am interrupted I shall lose the chain of my thoughts and have to repeat myself. It is impossible to expect the ordinary miners or farmworkers of this country to think they are being well governed when they are asked to vote £30,000 to subsidise grand opera at Covent Garden, which they are very unlikely to see personally. And from what I hear, whenever it is broadcast they immediately turn off the wireless. I am surprised indeed that a Labour Government should have the effrontery to come before us with such a suggestion, and I do not blame the right hon. Gentleman for being so reticent when we try to draw these facts from him
      Viscount Hinchingbrooke: I did ask the Financial Secretary three specific questions, none of which he has answered. I hope he did not think I was asking them for the purpose of obstruction. I asked whether the £350,000 was the total budget of the Arts Council and, if not, whether it has other funds to draw upon, and whether it would present an annual report for examination.
      Mr. Glenvil Hall: This is the first year of the existence of this Council. It works under a Royal Charter which was granted on 9th August, 1946. I speak under correction, but it is my belief that it does collect some moneys from outside. I would not be sure of that, but the grant in aid from the Government is, this year, as stated in the Estimate, £350,000.
      Sir W. Darling: The Committee are perhaps not aware that the Arts Council of Great Britain is the successor to C.E.M.A. C.E.M.A. did draw some funds from the public. They put on performances in different parts of the country which, in my opinion, were unsuitable and for which the public paid specified sums for admittance. While C.E.M.A. was a luxury we could afford if we were a wealthy country, or was a type of entertainment which might have been necessary in the harsh days of war, I doubt whether there is justification for the Arts Council of Great Britain today. Like all new bodies in a new sphere, C.E.M.A. blun-

      1121
      dered and muddled, and was not very successful. To ask the public to pay £350,000 for this, seems undesirable. The C.E.M.A. operated without paying the taxation which ordinary theatres and cinemas have to pay to the Exchequer. It is a privileged body, and, in addition to the privilege, it is being subsidised to the extent of £350,000. It seems to me that encouragement of an expenditure of this character is unseemly, and unbecoming to the circumstances of the hour. I will vote against this payment, as I think my constituents would wish me to. I want to encourage the arts, but I do not think this is the way to do so.
      This subsidy of certain types of entertainment which are largely dictated by persons who have not my political views, but people who have advanced views about the arts, is for a kind of entertainment which the public would not normally seek. The names of the plays which have been produced under C.E.M.A. are mostly of a foreign character, or they are produced by persons who are not of the conventional theatrical outlook. I do not think we should subsidise what is indeed a specialist movement. No doubt C.E.M.A. 's endeavours were admirable when we could afford them, but I do not think we can now be asked to put on the Statute Book a body called the Arts Council of Great Britain. We should tell those who are interested in the arts to find some other way of getting patrons.
      Mr. Malcolm MacMillan: I wish strongly to disagree with the two previous speakers on this point. I am quite sure that the Government are right in bringing forward this Estimate to supply, if necessary, these entertainments for the people of this country, most of all for agricultural workers and others, especially in areas to which private enterprise will not go. I am sure that this Committee will support the Government in that. I am sure that if the hon. Member who had spoken against this Estimate went to the people in the rural areas, among the fisher folk, they would find as high a taste in the arts and music as among Members of this Committee, including the hon. Member for South Edinburgh (Sir W. Darling), who entertains us in this House in his perhaps more conventional, theatrical way.
      Sir W. Darling: The fees of my entertainment were imposed upon me as re
      1122
      luctantly as I think this charge should be imposed upon the public.
      Mr. MacMillan: The hon. Member is under no obligation to have those fees imposed upon him, any more than he is under compulsion to accept profits from workers in his private enterprise business.
      I know that C.E.M.A. did excellent work in places where no private enterprise would have provided entertainment of that kind. They went to the Hebrides, the Orkneys and the Shetlands during the war. They were greatly appreciated and were invited back. They went at great personal inconvenience, and put up an excellent show, in the best sense of the term. The people there, all the crofters, fishermen and the rest, flocked to see them and to meet them personally because of their deep interest in their work and what they had to offer. I hope that no Member opposite will be such a snob as to suggest that agricultural workers have not at least as good a taste as the hon. Member for South Edinburgh.
      Mr. Osborne: I represent an agricultural constituency, and I think my constituents like good music and have as good an appreciation as any Member on the benches opposite, but they would rather have this £350,000 spent on cooking fats.
      Colonel Gomme-Duncan: I think the hon. Member for the Western Isles (Mr. M. MacMillan) has raised an excellent point. We do not know how this £350,000 is to be expended. We do not know, for example, how much is to be given to Scotland. We are entitled to know, when a grant of this size is being given, that a reasonable and fair proportion will be given to the encouragement of the arts and music in Scotland as well as in England. As the noble Lord has said, there is nothing to show how this money is expended by this body, though I am sure the matter will come before the Public Accounts Committee, after it has been spent. May we not know what is to happen, in order that we may have some opportunity of judging for ourselves?
      Resolved:
      "That a Supplementary sum, not exceeding £23,140, 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 sundry grants in aid of scientific investigation, &c., and other grants."

      SUPERANNUATION AND RETIRED ALLOWANCES.
      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 Superannuation and other non-effective annual allowances, additional allowances, gratuities, compassionate allowances and supplementary pensions in respect of civil employment."
      11.0 p.m.
      Mr. Peake: We pass from one interest to another. When the Estimate for injury grants, that is to say workmen's compensation, in the Royal Ordnance factories turns out to be only half the sum actually required, I think the right hon. Gentleman ought to give some information on how the original miscalculation came to be made. I refer to Subhead J.
      Mr. Butcher: I wish to express my concern that the amount which it is necessary to ask in respect of injury grants should be so large. I hope that whoever replies will be able to give an assurance that factories have the most modern methods for the prevention of injuries to work-people. Steps should be taken to keep the number down to the smallest possible figure We cannot afford to have skilled workers injured in work of this kind.
      Mr. Glenvil Hall: The increase by £335,000 in the amount under Subhead J, for injury grants, is entirely due to the abnormal number of claims which have been received, particularly from employees of the Royal Ordnance factories. It is partly due to the inevitable lag which takes place. Payments tend to overlap into another year. Following the war, a very much larger number of claims was put in when men left the factories as redundant or when the factories were closed down. Quite a number of such cases are only now coming forward for settlement. Also, owing to the higher rates of wages, compensation claims and payments have been higher than was previously the case. In addition, there has been a tendency to make lump sum payments rather than weekly payments.
      These factors taken together meant that an under-estimate was made when the original sum, which was thought to be sufficient, was put down. I regret that this increase is as much as £335,000, but
      1124
      these claims are there. The Treasury is in duty bound to pay them. It cannot query them in any way. That is the amount which I am afraid I must ask the Committee to give us.
      Colonel Gomme-Duncan: I do not understand why there should be this large difference. The right hon. Gentleman says that a number of people have left the Royal Ordnance factories on the changeover from war to peace. It appears to me that less instead of more money should be required. How is it that people come to claim compensation for injuries when they have left that employment?
      Mr. Howard (Westminster, St. George's): Can the Financial Secretary give the Committee an assurance that it is no part of the cause of this large Supplementary Estimate that there has been an increase in the rate of accidents in these factories? That is a point which worries me. It is a thing which is suggested at first sight of this figure. If the right hon. Gentleman could give the Committee that assurance, I would be satisfied.
      Sir W. Darling: I know something about workmen's compensation and I regard this as a most alarming figure. If it becomes known that compensation for injuries during State employment in the Royal Ordnance factories costs £681,000, there will be a reluctance to enter the service of the State, which would be very disquieting to hon. Members opposite. This is surely astonishingly bad housekeeping. The insurance companies have for 30 years been doing this sort of business, and any such enormous expansion as this would have been disastrous. I sincerely hope that this kind of thing will not repeatedly come before the Committee, because it will arouse in the minds of people the idea that a great many people have been involved in accidents in ordnance factories and will arouse great disquiet in the minds of those who have to find these sums of money. I feel that this really calls for some inquiry, if the standard of accidents is so very high in Government factories. This astonishing payment of £681,000, which is double the amount met by two companies doing workmen's compensation business, really disquiets me.
      Mr. Osborne: The Financial Secretary, in his reply, said the amount was large because lump sums had been paid to the

      1125
      men who had claims. I have always thought that it was the best trade union opinion that it was a very bad thing to allow an injured man to take a lump sum payment, and, if that be so, and I have heard it explained many times on Socialist platforms, why should a Socialist Government do something they never meant to do?
      Mr. Glenvil Hall: It all depends what the lump sum amounts to, and whether it is an amount which is just and proper for the injured man to receive. I am only dealing with the reasons for this Estimate, and I can only give the Committee the true explanation. These ordnance factories have been going for six or seven years, largely years of war, and a number of people employed have suffered injury. Some of them suffered a minor injury, while others suffered a major injury, at any rate, the loss of a finger or of a couple of fingers, but they carried on, thinking they could serve the country during the war years, although they had suffered this injury. They had a claim, which they kept alive, and, when the ordnance factory closed down, or they became redundant, they put in one final claim, which was settled. We are here telescoping into one period a number of claims which would normally have been spread over a much longer time. I hope that the hon. Member for South Edinburgh (Sir W. Darling) will not imagine for one moment that work in Government factories is necessarily dangerous, or that, during this period, a great many injuries were suffered. In actual fact, this is part of the clearing-up of the war years, and we have to take that into account when we look at the Supplementary Estimate, which I now ask the Committee to approve.
      Colonel Gomme-Duncan: Are we to understand that people leaving an ordnance factory put in claims for the loss of, for example, fingers in accidents that happened five years ago? As I understand it, under the existing workmen's compensation legislation, that is not legal.
      Mr. Osborne: May I press the Financial Secretary on this point? The trade unions have always been agreed that for a workman to take a lump sum was a bad thing. If it has been a bad thing in past years to take a lump sum from a private em-
      1126
      ployer, why should it be a good thing now to take It from the State?
      Mr. Pritt: Surely, the hon. Member opposite is displaying the most abysmal ignorance? Many hon. Members on these Benches have been intimately associated with workmen's compensation for years, and have devoted a great deal of time to this matter. We all know that there are a great many cases, especially in the early stages of injury, when it is unwise to take a lump sum in settlement especially if it is offered by ordinary means by the insurance companies, who have been notorious for many years in this respect. So much was that the case that we had to make it the law of the land that no settlement made by an insurance company or by a lawyer would be legal and binding until it had been approved by the registrar of the courts. In other cases of course, it is better to take a lump sum in settlement.
      The Chairman: I cannot allow this Debate on the Supplementary Estimate to become a Debate on workmen's compensation administration.
      Mr. Pritt: With very great respect, Major Milner, you have been listening to a great deal of nonsense in the last few minutes, and I only wanted to clear the position up.
      Mr. Manningham-Buller: We have listened with much interest to the address on workmen's compensation from the hon. and learned Member for North Hammersmith (Mr. Pritt) but I do not propose to follow him in that. I think that the explanation of this Vote by the Financial Secretary to the Treasury was most unsatisfactory. I gathered that the latter part of the Vote related to lump sum settlements, and the rest of it related to overdue claims, which are now arising owing to redundancy and through factories closing down, but on neither of these grounds does workmen's compensation become payable. I really think that the Financial Secretary ought to make it dear how these claims arose and why they were not disposed of be fore. It seems to me that the Financial Secretary is in this dilemma, that he must either say that the rate of accidents in the ordnance factories has exceeded the numbers in other factories—though I hope

      1127
      that is not the case—or the Government have been extremely dilatory in dealing with the cases against them. If an in dividual, after suffering his injury, has also to suffer a great deal of delay a suspicion does arise that the number of claims have been so great that the man went on earning his ex gratia rate of pay and under those circumstances the liability to pay arose.
      Mr. Pritt: I gave way before, Major Milner, because I thought you called me to do so in order to facilitate the Committee, but as we have just listened to a little additional nonsense being talked, I must be permitted to continue what I was saying. The Financial Secretary gave the instance of a man who has lost a couple of fingers, and who finds that owing to full employment his work is greatly needed, and he can go on and earn full money. When he gets to the end of that work, there is no real necessity for him to continue working under handicap and the loss of two fingers is a typical workmen's compensation claim. It is a little undefinable and a little difficult, and sometimes when the ingenuity of the insurance companies is devoted to it, it is harder still to define. However, the loss of two fingers is a real claim, and insurance companies are glad to pay money as would the employer to be rid of that claim. The real difference here is that there is real conscience on the part of the Royal ordnance factories paying £600,000 in workmen's compensation and the insurance companies, because where £600,000 is due by them they only pay an average ratio payment of 50 per cent. and someone else has to pay the remainder.
      Resolved:
      "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 31st March, 1947 for superannuation and other non-effective annual allowances, additional allowances, gratuities, compassionate allowances and supplementary pensions in respect of civil employment."

      WAR DAMAGE COMMISSION
      Resolved:
      "That a Supplementary sum, not exceeding £96,500, be granted to His Majesty, to defray the charge which will come in course
      1128
      of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the War Damage Commission."

      INLAND REVENUE
      Motion made, and Question proposed,
      "That a Supplementary sum, not exceeding £550,000, he 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 Inland Revenue Department."
      11.15 p.m.
      Mr. Manningham-Buller: I see that in Item B, "Travelling and Removal Expenses," there is an additional sum of £60,000 required. Could the Financial Secretary say what proportion of the total sum is due to removal expenses and what amount for travelling? This is a pretty substantial sum, and I think we ought to be told that is the sum that is not likely to recur again, and what is the normal sum for travelling.
      Mr. Howard: May f ask the Financial Secretary some questions arising out of Vote A? The first is: Can he tell us how much of this additional sum of £490,000 is in respect of additional staff for P.A.Y.E.. and how much for the other purposes? Secondly, can he tell us whether he is quite satisfied that this Supplementary Estimate for increased estimates for administration in P.A.Y.E. will be the last he will have to bring forward for this purpose? I venture to think that the events of the recent weeks may add considerably to the cost of administering the P.A.Y.E. scheme, and I think it is important that we should know whether this is likely to be the last supplementary item which we shall be asked to vote for this purpose.
      Mr. Osborne: May I ask a question concerning Class B "Travelling and Removal Expenses "? That affects, I take it, the Inland Revenue people who are in Blackpool and in Lancashire at the present time. As we have heard on many occasions, most of them want to come back to London. Can the Financial Secretary give us any information that they are to be brought back and this item will disappear?
      Mr. Glenvil Hall: I am sorry, but I am not able to reply to the hon. and learned Gentleman the Member for Daventry (Mr. Manningham-Buller).I

      1129
      have not the information here but I will certainly get the Inland Revenue to let me have these figures, and I will pass them on to him in due course. The answer to the question about the salaries under Subhead A is that there has been an increase in the nine months ending 31st December last from 27,900 to 33,000, that is, an increase of 5,100, in the staff dealing with P.A.Y.E.
      Mr. Howard: That is in numbers, not in amount?
      Mr. Glenvill Hall: In numbers. How much of the additional £490,000 is attributable to salaries, and how much to the extra amount payable on account of National Insurance, I cannot, at the moment, say, but I would say that obviously the one can bear little or no relationship to the other, and that the vast bulk of this extra money will go actually on salaries for the 5,100 extra people I have mentioned. Although P.A.Y.E. has, as I think the Committee knows, been very much in arrears in the latter part of the war, I can give the Committee this assurance—no further recruitment is to take place. That, of course, is in view of the man-power shortage, and is not due to the fact that the Inland Revenue could not do with the extra staff. The staff is working extremely hard under difficult conditions, but I can assure the Committee that we have no intention of further increasing the numbers under this head. I think that this answers most if not all of the queries put to me.
      Mr. Osborne: May I ask the Financial Secretary if his statement foreshadows the end of P.A.Y.E.?
      Mr. Glenvil Hall: Oh, no.
      Mr. Howard: I do not want to press this matter too far, but is there any real danger of further arrears arising in the settlement of P.A.Y.E.? Does the fact that the Financial Secretary does not propose to get further staff mean that there is a danger of arrears accumulating? I would be glad to have an answer.
      Colonel Gomme-Duncan: Is it not an extraordinary thing that an estimate of the number of staff required could not have been made by the right hon. Gentleman's Department? Could it not have been foreseen? Here we are, nearly a half a million
      1130
      of money out in a calculation. The right hon. Gentleman says that there is a shortage of manpower, but I suggest that he should ask himself "Where is the manpower?" It is in establishments where the Government are hiding it—where the Government are hiding people instead of putting them into their proper places. The Home Secretary laughs, but if he does not know the facts he is not fit to hold his present position. I should like to get an answer as to why this Estimate was so badly done when first presented.
      Hon. Members: Answer.
      Resolved:
      "That a Supplementary sum, not exceeding,550,000, 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 Inland Revenue Department."

      LAW CHARGES AND COURTS OF LAW, SCOTLAND
      Motion made, and Question proposed,
      "That a Supplementary sum, not exceeding £10, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1947, for the salaries and expenses of the Lord Advocate's Department, and of the law charges and salaries and expenses of the Courts of Law and Justice and of Pensions Appeal Tribunals, in Scotland."
      Mr. Willis: I should like to ask a question on Subhead concerning an additional £500 which, according to the details, is being asked for shorthand writers' bills on behalf of poor litigants in civil cases. I want to ask whether this increase is due to increased fees to shorthand writers, or whether a larger number of poor litigants are receiving aid. Another point on which I should like some information is that this seems to be a new departure. The payment of shorthand writers' fees seems to be something new, and something which, personally, I am in favour of seeing.
      Mr. Spence: There is one small item, not given in the appendix, and that is regarding Subhead J, where I see there is a saving in salaries—
      The Chairman: The hon. Member is not entitled to discuss savings. This is a question of expenditure.
      Mr. Spence: I am sorry, Mr. Chairman, but I want to ask for information on Subhead J where anticipated savings—
      The Chairman: The hon. Member is not entitled to raise any question as to savings set out in the Estimate.
      Mr. Spence: I bow to your Ruling, Major Milner, and I will refer to another matter, and that concerns Subhead N. Why is there an additional £1,700 for travelling and incidental expenses over an original estimate of £3,000? This is an increase of more than fifty per cent., and I think that we ought to get nearer the mark than that when the first estimate is made. Can the Financial Secretary explain that?
      Mr. McKie: I want to ask a question on Subhead K—incidental expenses, removal expenses of sheriffs substitute and removal expenses and lodging allowances of procurators fiscal and sheriff clerks. I see that an additional sum of £3,400 has been asked in addition to the £3,800 provided for in the first Estimate. I do not raise this question in any spirit of dissatisfaction—quite the opposite. I am only too glad that sheriffs substitute and people connected with the administration of the law in Scotland should be adequately remunerated. But I would like to ask for a few details as this seems to be a large sum. I feel that we are entitled to a few details regarding just how this much larger sum was not foreseen originally. I may say in passing that sheriffs substitute in Scotland have for a long time felt that, so far as salary was concerned, they were very inadequately remunerated, indeed; so I am very glad to think that this sum is being allowed them. But I should be glad to have from the right hon. Gentleman, or from the Lord Advocate, some explanation.
      Sir W. Darling: The law charges under the Crown in Scotland are always a matter of great interest to us, and we have on this very rare occasion the presence of the Lord Advocate. We give him, I think, too few opportunities to give the House his opinions. How is it that the grants for expenditure for his Department have risen to this extent? I have great admiration for the Lord Advocate, but I do not think he is entitled to be any more expensive than his predecessors, despite his remarkable qualities. I think he has such excellent qualities, but I think this time he
      1132
      should shed his natural modesty, and explain to the Committee how it is that his Department is worth £1,640 more than it was under any of his distinguished predecessors.
      Lieut.-Colonel Elliot: Are we to understand that there is to be no answer?
      Mr. Glenvil Hall: If the Committee wish me to do so, I will reply; but on the other hand, I do not desire to waste the time of the Committee.
      Sir W. Darling: On a point of Order, Major Milner. Is it in Order for the Financial Secretary to suggest that the action of hon. Members on this side of the Committee in interrogating him regarding public expenditure, is a waste of public time?
      Mr. McKie: Further to that point of Order. Is it not unusual for a Minister of the Crown, or a junior Minister, to suggest that points which hon. Members have made regarding the expenditure of public money—and we are custodians of the public purse—are not worthy of an answer?
      The Chairman: I do not think the right hon. Gentleman intended his words to be taken in that way. I think he meant his reference to waste of time to mean the time that he might be compelled to occupy himself.
      Mr. Glenvil Hall: That interpretation is quite correct. I, too, have sat on that side of the Committee, and have asked questions not hoping, and certainly not getting, any reply from Ministers of Departments. The hon. Member for South Edinburgh (Sir W. Darling) asked me about Subhead I, which deals with travelling and incidental expenses of the Court of Session. It is quite right that this is the first time that this item has appeared in a vote of this kind, but it is a new charge. It is, as he rightly surmised, and as, indeed, is mentioned in the Estimate itself, payment from public funds of the cost of attendance fees of shorthand writers, and of the cost of transscriptions, in appeals by poor persons. Therefore, I think hon. Members in all quarters of the Committee will agree that an expenditure of that kind—£500 in all, not very much—has been well worth while, and is thoroughly to be approved.

      1133
      11.30 p.m.
      The hon. Member for Galloway (Mr. McKie) asked me to give some particulars about Subhead K, an amount of £3,400, incidental expenses of sheriff courts. This £3,400 includes postage and incidental expenses of sheriff clerks, and removal expenses of sheriffs-substitute and of court officials. Apparently—I do not really know the reason; doubtless hon. Members for Scottish constituencies will know —there have been a good many vacancies during the past year, more than was expected, which has meant a rise in this particular Estimate, and has necessitated our coming to the Committee for a supplementary sum. There have been transfers of officers from one post to another on promotion, and part of the expenses has been due to the great shortage of houses. That has meant expenditure on removals, lodging allowances and so on.
      The hon. Member for Central Aberdeen (Mr. Spence) asked me if I would give a little further information on Subhead N, which deals with pension appeals tribunals, and travelling and incidental expenses. The main increase here comes from our allowing expenses to men who have lodged applications for leave to appeal to the Court of Sessions against decisions of the pensions appeal tribunal. There was a decision given in the Court of Sessions which made it appear to my right hon. Friend the Minister of Pensions that quite a number of cases, whose hearing was then pending, would follow the decision given in the case which had, by then, been decided in the Court of Sessions. He, therefore—in my view quite rightly—withdrew all opposition, and the men concerned were allowed their legal expenses up to the date of the withdrawal. That, of course, has meant an increase in this Supplementary Estimate. An increase of subsistence allowances, and other expenses of appellants, was also agreed to during the year, and has meant some in crease in this Vote.
      I think I have answered most of the points put to me. The hon. Member for South Edinburgh was curious to know how the increase in the Lord Advocate's Department had been made up.
      Sir W. Darling: It was anxiety, not curiosity.
      Mr. Glenvil Hall: The Solicitor-General, who previously was not debarred from
      1134
      conducting private practice, has now become a full time Officer of the Crown. That, of course, has necessitated making his salary commensurate with the office he held, and it was—
      Sir W. Darling: We do not see him here.
      Mr. Glenvil Hall: It he enters Parliament, of course, a different set of circumstances will undoubtedly arise. He is actually a full time Officer of the Crown in Scotland. In consequence, his salary was increased from £2,000 to £3,000 from 1st April last year, and that £1,000 is included in the Supplementary Estimate. In addition, the salaries of the four Advocates Depute have been fixed at something higher than they were before. I think that for many years they were £700, but owing to the general rise in the cost of living, and the extra work and responsibility involved, they have been increased to £850, an increase of £150 in each case. Then, too, the First Assistant Legal Secretary has had, like so many others in various branches—of commerce, law and the Civil Service—received some increase in salary. These, and certain other charges, make up the amount which is set forth in the Supplementary Estimate.
      Sir W. Darling: Rather more than the amount.
      Mr. Glenvil Hall: Yes, that is true, but there is a set-off of £358 against this; the net figure has been put in. The £358 has been saved by deduction of military pay of officers serving with the Forces.
      Colonel Gomme-Duncan: I am not quite clear on this question of the addition to the salary of the Solicitor-General. I understand from the right hon. Gentleman that the increase of £1,000 a year is to date as from 1st April last year. That is 11 months ago. Can he tell the Committee when it was decided that this increase would be made, and how it is that it months ago it was not possible to put it in the original estimate?
      The Chairman: If the hon. and gallant Member will permit me to say so, the right hon. Gentleman attempted to answer that. The hon. and gallant Gentleman has now, I think, repeated a question which was asked in his first speech.
      Lieut.-Colonel Elliot: I think it would only be fair to compliment the Financial

      1135
      Secretary on the dexterity with which he has threaded his way among the intricacies of the Scottish legal system. That is all the more a remarkable feat as he had beside him an expert paid a large sum for giving counsel on such points. However, we shall seek some other opportunity of following this matter up in greater detail. But, I cannot compliment the right hon. Gentleman on behalf of Scottish hon. Members, on his acquaintance with our Scottish language. He referred to the "Court of Sessions," an unusual figure in our language, because the Court of Session is usually referred to in the singular. I was waiting for the Lord Advocate to correct him, but he was so surprised by the efficiency of his recruit that he did not wish to call attention to an occasional slip. As I say, we merely compliment the right hon. Gentleman and will take a further opportunity of following the matter up.
      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 Lord Advocate's Department and other law charges, the salaries and expenses of the Courts of Law and justice and of Pensions Appeal Tribunals in Scotland."

      SCOTTISH HOME DEPARTMENT.
      Motion made, and Question proposed,
      "That a Supplementary sum, not exceeding £107,021 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 Office of the Secretary of State for Scotland; salaries and expenses of the Scottish Home Department; expenses in respect of private legislation procedure in Scotland; a subsidy for transport services to the Western Highlands and Islands, etc.; a grant in lieu of Land Tax; contributions towards the expenses of Probation and Remand Homes and grants in connection with physical training and recreation "
      Mr. Malcolm MacMillan: On Subhead D we are suddenly asked to take an Estimate from the sum of fro to a sum 12,499 times the original Estimate. I take it that we shall have some sort of explanation of this revised Estimate. There are several items under this head on which I would like some informa-
      1136
      tion. You did rule earlier, Major Milner, in respect of the National Trust that the Government are not responsible for the details of the working of that body. But, in this case I think you will regard it rather differently. Here is a subsidy from the Treasury to a company which, in the first place, is paid for carrying mails, running between given ports to a timetable stated by the Ministry of Transport, the Post Office and the Scottish Office. The Government Departments concerned are closely interested in the day to day working of this service, both in respect of the carriage of mails and the controlled carriage of passengers and goods. The Joint Under-Secretary might well give us a fairly detailed explanation of -this extraordinarily increased Estimate, which, originally £10, has risen by £124,990. It would have made the figure easier had another £10 been added to it.
      There is one point on which I wish him to give us some explanation; that is, with regard to the expenses of the Government director on the board of McBrayne's steamers. We have had various representations made in respect of him from time to time. He is a benevolent gentleman of the age of about 77 or 78 years, and the Government give him an even more benevolent salary, under this Vote of £400 a year for attending, I believe, two meetings annually. That works out at about £200 an hour for two meetings lasting one hour each. This is a matter in which the Government are interested—the running of this service in the public service. Is my hon. Friend satisfied that that part of the Vote in respect of the activities of this gentleman is justified, and has he proposals in that connection in regard to the subsidy? I suggest to him that this Government representative has not justified that part of the Vote which is paid in respect of his activities. He has not given, so far as the Scottish Office and the Ministry of Transport are concerned the report that should be called for by them. They have perhaps been lax in not demanding it; he has been lax in not proffering it. I should like some sort of information on that subject. Has my hon. Friend anything to say in respect of the efficiency of that gentleman in the carrying out of his duties? I should like him to know that we in the areas so badly served in this respect are not satisfied by one elderly gentleman sitting on a Board. The determina-

      1137
      tion of the present contract in respect of the director must come up at the end of the financial year, covered by this Vote. I hope the Government will have consultations, and will give assurances that they will consult with the people in the areas concerned—Members of Parliament and others.
      This Vote is out of proportion to the character and efficiency of the service run by McBrayne's Steamship Co. We are unfortunately obliged to discuss this matter under this Vote because we have not the advantage of having it included in the Government's nationalisation proposals. I know that my hon. and gallant Friend the Member for Orkney and Shetland (Sir B. Neven-Spence), who is a champion of private enterprise, is at one with me in requiring of the Government that they should pay heed to the problem of the Islands service and he would welcome nationalisation, too. Nor are we satisfied with the running of this service I cannot go into the details other than I have already done in respect of our watchdog on the McBrayne board, but I expect that the Under-Secretary to give us some sort of reason why we should pass this vastly increased Vote tonight. unless we have assurances that this service is to be stepped up to the requirements of the people in this area. Perhaps inure than any corresponding service in. Britain this service should be at the highest peak of efficiency. We are throttled from the economic and social point of view as an island population by the inefficient organisation. I hesitate to pass without criticism an increased Estimate of this kind unless I receive the strongest assurance from the Joint Under-Secretary of State for Scotland, the Minister of Transport and the other Ministers associated with this Vote, that the utmost pressure will be brought to bear upon this company.
      11.45 p.m.
      There is one point in connection with the administration of the service. I hope that the Minister will consider whether he can say what are the intentions of the Government with regard to accommodating not one but more than one Government director on this board, until such time as other measures can be taken by legislation to control it adequately. We are not satisfied that the service which the Islands need is provided. We feel
      1138
      that we could make a much bigger contribution to the economic development of the counrty if we were given an efficient service. The people have much more to offer than they are allowed to offer, and much more to contribute than they are able to contribute while they are throttled by bad transport. I hope the Joint Under-Secretary will endeavour to justify this extraordinary increase.
      Colonel Gomme - Duncan: Having listened to the hon. Member for Western Isles (Mr. M. MacMillan), I do not think that we on this side of the Committee can agree with what he said about the old gentleman. But we can associate ourselves with his request for a clear statement from the Joint Under-Secretary explaining this big jump from £10 to £125,000. I hope the hon. Gentleman will tell us how it was not possible earlier to say that this would be required.
      The Joint Under-Secretary of State for Scotland (Mr. Thomas Fraser): I want to make it clear that the vastly increased sum required is not something which has taken us altogether by surprise. Indeed, some indication of the reason is given in the details of the Subheads of the Supplementary Estimate. When the main Estimates were presented, these vessels, which are owned by the two companies operating to the Islands of the West of Scotland, were requisitioned by the Government. At that time we made only a token Estimate of £10 in respect of their services. The vessels which were on war service were derequisitioned on 2nd March, 1946. Since then the Ministry of Transport have been negotiating new contracts with the operators. These new contracts, when concluded, must be laid before Parliament. At that moment hon. Members who wish to make detailed inquiries into the nature of the services provided by these operators will have a very full opportunity. The present contract year will come to an end on the 31st March, 1947, and a sum in excess of the sum provided for in the Estimate will be necessary. We have had to make payments to the operators up to the amount set out in the Supplementary Estimate to enable them to continue to operate the service pending the conclusion of a new contract, and that is the reason for this vastly increased sum in the Estimate.

      1139
      My hon. Friend the hon. Member for the Western Isles (Mr. M. MacMillan) asked me a question about the Government director on McBrayne's. I do not wish to discuss in a detailed way the work of the Government director, but I think that, since my hon. Friend has raised the matter he might be interested to know that the Government director in question was employed under contract for a period of 10 years, which period expires on 31st March this year, and, indeed, the appointment of a successor to this gentleman is under active consideration. He asked me further for an assurance that the service would be improved, and again I repeat that I consider that the details of the service could be best discussed when the new contracts are laid before the House.
      Mr. M. MacMillan: Perhaps the hon. Gentleman could give me an answer which will afford more consolation to the local people, and also indicate if there will be local consultations before appointing the new director?
      Mr. Fraser: I should imagine that there would be certain consultations with local people. I am sorry if my hon. Friend is able to give the Committee the assurance that there have been none so far, but I can give him an undertaking that I will take to heart what he has said and the pressure he has put upon us that there should be some local consultations, and will place them before the appropriate authority.
      Resolved:
      "That a Supplementary sum, not exceeding,£107,021, 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 Office of the Secretary of State for Scotland; salaries and expenses of the Scottish Home Department; expenses in respect of private legislation procedure in Scotland; a subsidy for transport services to the Western Highlands and Islands, &c.; a grant in lieu of Land Tax; contributions towards the expenses of Probation and of Remand Homes and grants in connection with physical training and recreation."

    POLICE. SCOTLAND
    Resolved:
    "That a Supplementary sum, not exceeding £105,250, be granted to His Majesty, to defray the charge which will come in course of payment during the year ending on the 31st
    1140
    day of March, 1947, for the salary and expenses of the Inspector of Constabulary, the cost of special services, grants in respect of Police expenditure and a grant in aid of the Police Federation in Scotland."

    PUBLIC EDUCATION, SCOTLAND
    Resolved:
    "That a Supplementary sum, not exceeding £1,321,942, 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 public education in Scotland, including certain grants in aid of the Education (Scotland) Fund, and for the Royal Scottish Museum, Edinburgh, including a grant in aid."
    Ordered: "That the Chairman do report Progress, and ask leave to sit again." [Mr. William Whiteley.]
    Resolutions to be reported Tomorrow; Committee also report Progress; to sit again Tomorrow.

  SUNDAY CINEMATOGRAPH ENTERTAINMENTS
  11.55 p.m.
  The Secretary of State for the Home Department (Mr. Ede): I beg to move, "That the Order made by the Secretary of State for the Home Department, extending Section 1 of the Sunday Entertainments Act, 1932, to the Urban District of Skelton and Brotton, a copy of which Order was presented on 14th February, be approved."
  I am glad to see the right hon. Gentleman the Member for North Leeds (Mr. Peake) in his place, because on an occasion a few days ago when one of these Orders was down for discussion he called attention to the fact that no representative of the Home Office was present to move it. Of course, the right hon. Gentleman had a very distinguished career as Under-Secretary to the Home Department, and therefore is aware of the practice in these matters. On that occasion a few days ago I was under Royal Command and was unable to be here. My hon. Friend the Under-Secretary of State was in the country, and we had handed to my hon. Friend the Junior Lord of the Treasury all the papers relating to the case, which the right hon. Gentleman had mentioned, and whose queries if he had any would have been effectively answered by the Junior Lord of the Treasury. The right hon. Gentleman can rest assured that on all occasions when these Orders are down on

  1141
  the Paper there is full information in the House in order that they may be answered. I have only one other thing to say. I have compared our record to the record of the right hon. Gentleman when he was Under-Secretary, and I do not think that there is any need for further comment on the matter.
  11.57 p.m
  Mr. Osbert Peake: I am sure we all wish to agree in the main with the Motion which is before the House, but the Home Secretary has used the occasion to draw attention to the fact that there was some comment when a Motion standing in his name a few days ago was not moved by a representative of his Department. I must confess that it seemed to me to be of primary importance, even in relatively unimportant matters and Orders standing in the name of the Secretary of State or the Under-Secretary, that the person concerned shall be in the House in order to move the Order when it is called. The right hon. Gentleman says he has taken some trouble to ascertain what my record as Under-Secretary was. I am only surprised that he should have employed one of his hard-working officials to make researches back over a number of years in order to ascertain what my record was.
  Mr. Ede: I made the researches myself.
  Mr. Peake: The right hon. Gentleman says that he did it himself. I was nearly five years at the Home Office and I moved many hundreds of these Orders. I am
  1142
  only sorry that the right hon. Gentleman wasted so much of his time.
  Mr. Deputy-Speaker (Major Milner): I should point out that I was not aware of what the Home Secretary proposed to say, but as I allowed him to make a statement, I thought it right to permit a reply from the Opposition benches, though the whole matter was not strictly in Order.
  Resolved:
  "That the Order made by the Secretary of State for the Home Department, extending Section 1 of the Sunday Entertainments Act, 1932, to the Urban District of Formby, a copy of which Order was presented on 14th February, be approved."
  Resolved:
  "That the order made by the Secretary of State for the Home Department, extending Section 1 of the Sunday Entertainments Act 1932, to the Rural District of Tenbury, copy of which Order was presented on 14th February he approved."
  Resolved:
  "That the Order made by the Secretary of State for the Home Department, extending Section 1 of the Sunday Entertainments Act, 1932, to the City of Carlisle, a copy of which Order was presented on 14th February, be approved."—[Mr. Ede.]

  SUNDAY CINEMATOGRAPH ENTERTAINMENTS

    ADJOURNMENT
    Resolved: "That this House do now adjourn."—[Mr. Snow.]
    Adjourned accordingly at One Minute to Twelve o'Clock.

BRITISH ARMY
  Railway Crossings, Arncott Depot (Accidents)
  Railway Crossings, Arncott Depot (Accidents)
  Civilian Demonstrations, Padua
  Civilian Demonstrations, Padua
  Troops, Japan (Withdrawal)
  Troops, Japan (Withdrawal)
  Court-Martial Sentences, Port Said
  Court-Martial Sentences, Port Said
  Police Service, Palestine
  Police Service, Palestine
  Venereal Disease
  Venereal Disease
  Surplus Diesel Generators
  Surplus Diesel Generators
  Civilian Lorry Drivers (Accommodation)
  Civilian Lorry Drivers (Accommodation)
  Deserters (Courts Martial)
  Deserters (Courts Martial)
  Greek Civilian Claims
  Greek Civilian Claims
  Empress of Scotland Incident (Sentences)
  Empress of Scotland Incident (Sentences)
  Personal Case
  Personal Case
  Called Up Personnel
  Called Up Personnel
  Occupied Establishments. Merioneth
  Occupied Establishments. Merioneth
PRISONERS OF WAR
  Service Vehicle Drivers (Fatal Accidents)
  Service Vehicle Drivers (Fatal Accidents)
  Camp, Aston Abbotts
  Camp, Aston Abbotts
  U-Boat Commanders
  U-Boat Commanders
NATIONAL FINANCE
  Ex-Service Pensioners, Dominions
  Ex-Service Pensioners, Dominions
  Entertainments Duty (Living Theatre)
  Entertainments Duty (Living Theatre)
  Birmingham Chamber of Commerce (Letter)
  Birmingham Chamber of Commerce (Letter)
  Site Values (Taxation)
  Site Values (Taxation)
  Income Tax Returns
  Income Tax Returns
TRADE AND COMMERCE
  Business Interests (Japan)
  Business Interests (Japan)
  Company Directors (Change of Name)
  Company Directors (Change of Name)
  Industrial Guide, Barrow-in-Furness (Paper)
  Industrial Guide, Barrow-in-Furness (Paper)
  Paper Supplies (Football Pools)
  Paper Supplies (Football Pools)
TOWN AND COUNTRY PLANNING
  National Parks
  National Parks
  Laindon-Pitsea Area
  Laindon-Pitsea Area
  Air Firing Range, Sheppey
  Air Firing Range, Sheppey
  Service Training Areas, Wales
  Service Training Areas, Wales
NATIONAL INSURANCE
  Pensioners (Employment)
  Pensioners (Employment)
  Personal Cases
  Personal Cases
  Voluntary Contributions
  Voluntary Contributions
EMPLOYMENT
  Essential Work Orders (Cessation)
  Essential Work Orders (Cessation)
  Aberdeenshire
  Aberdeenshire
  Age Limits
  Age Limits
  Exchanges (Emergency Arrangements)
  Exchanges (Emergency Arrangements)
  Industrial Disputes (Stoppages)
  Industrial Disputes (Stoppages)
  Entertainment and Sport
  Entertainment and Sport
  Caernarvon
  Caernarvon
  Cost-of-Living Index
  Cost-of-Living Index
  Coalminers
  Coalminers
  Dominion Migration
  Dominion Migration
  training Centres, West Riding
  training Centres, West Riding
NATIONAL SERVICE
  Release and Call-up
  Release and Call-up
  Exemptions
  Exemptions
SCOTLAND
  Remand Home Inmates (Medical Examination)
  Remand Home Inmates (Medical Examination)
  Hill Farming Grants
  Hill Farming Grants
  Police Detention
  Police Detention
  Rural Water Supply Grants
  Rural Water Supply Grants
  RAILWAYMEN'S CONVICTION
  RAILWAYMEN'S CONVICTION
  ALIENS (CHANGE OF NAME)
  ALIENS (CHANGE OF NAME)
  GERMAN FIANCEES
  GERMAN FIANCEES
  GERMAN PRISONERS (SCREENING)
  GERMAN PRISONERS (SCREENING)
  GERMANY (VENEREAL DISEASE)
  GERMANY (VENEREAL DISEASE)
ARMED FORCES
  Manpower Economy
  Manpower Economy
  Medical Officers
  Medical Officers
MINISTRY OF SUPPLY
  Surplus Barbed Wire
  Surplus Barbed Wire
  Penicillin
  Penicillin
  Agricultural Fencing
  Agricultural Fencing
  FORCES MAIL. HONG KONG
  FORCES MAIL. HONG KONG
  ROYAL NAVY (MEDICAL OFFICERS)
  ROYAL NAVY (MEDICAL OFFICERS)
  ELECTRICITY REDUCTION ORDER
  ELECTRICITY REDUCTION ORDER
  RABBIT TRAPPING
  RABBIT TRAPPING
  PENSIONS APPEAL TRIBUNALS
  PENSIONS APPEAL TRIBUNALS
FOOD SUPPLIES
  Potatoes, Northern Ireland
  Potatoes, Northern Ireland
  Oatmeal Production, Scotland
  Oatmeal Production, Scotland
  MEN AND WOMEN TEACHERS
  MEN AND WOMEN TEACHERS
Preamble
The House met at half past two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers.
The Lord Kensington—Took the Oath.

BUSINESS OF THE HOUSE.
THE SECRETARY OF STATE FOR DOMINION AFFAIRS (VISCOUNT ADDISON): My Lords, I beg to move the Motion which stands in my name.
Moved, That Standing Order No. XXI be considered in order to its being dispensed with for the purpose of giving precedence to the motion for the Third Reading of the Pensions (Increase) Bill and the Road Traffic (Driving Licences) Bill over the other Notices and Orders of the Day.—(Viscount Addison.)
On Question, Motion agreed to and ordered accordingly.

SITUATION IN TRINIDAD.
LORD TWEEDSMUIR: My Lords, I rise to ask the question which stands in my name.
[The question was as follows:
To ask His Majesty's Government whether the account of the situation hi Trinidad given in recent reports in the Daily Mirror is accurate.]
THE FIRST LORD OF THE ADMIRALTY (VISCOUNT HALL): My Lords, my right honourable friend the Secretary of State for the Colonies has already stated in another place that it is not in question that there were acts of violence, mass intimidation and sabotage in the course of the recent disturbances in Trinidad, and that the Governor of the Island has acted throughout the troubles with the unanimous support of the official and non-official members of his Executive Council. The police and other authorities were concerned to take the necessary steps for the protection of the general
686
community including the large majority of trades unionists. My right honourable friend has called upon the Acting Governor of Trinidad to furnish him with a full report upon the occurrences on the conclusion of the local proceedings, and the matter will receive his close attention when that report is received.
In the meantime, the information which has reached him is being compared with the reports which have appeared in the Daily Mirror, but my right honourable friend is awaiting fuller information before accepting the newspaper reports and the criticisms which have been made of the actions of the authorities in Trinidad, in what were undoubtedly difficult and anxious circumstances. For the convenience and information of your Lordships, and with the concurrence of the noble Lord who has asked me this question, I am appending to my answer in Hansard a summary of several statements which have been made recently in another place by the Secretary of State for the Colonies on the situation in Trinidad.
LORD TWEEDSMUIR: I am obliged to the noble Lord for his answer.
[The following is the summary referred to:
There have been three strikes recently in Trinidad, the first being declared by the Seamen's and Waterfront Workers' Union on November 8 last, after a claim for 50 per cent. increase in wages and a reduction in hours of work had been rejected by the Shipping Association. This strike was terminated on December 5, when the Shipping Association agreed to apply to their employees the terms of any fresh agreement which might be reached between the Government Wharves Administration and the Union; and discussions with a view to the preparation of a new agreement are proceeding.
On January 8, the Public Works and Public Services Workers' Trade Union called a strike of its members. Discussions had been taking place between the Trinidad Government and the Federated Workers' Trade Union, which claims the largest membership of the workers concerned, but the Public Works and Public Services Workers' Trade Union had declined to associate itself with the Federated Workers' Trade Union in these discussions. A Committee is at work on the revision of current schedules of groups and basic wage salaries for Government employees. The strikers in this case number 1,113 out of 8,900 Government employees.
On November 11, Uriah Butler, as President-General of the British Empire Workers', Peasants' and Ratepayers' Association, submitted certain demands to the employers in the oil industry, which were

687
rejected. On December 9, Butler, on behalf of another body called the Mineral Development Union, called a strike. The Oilfield Workers' Trade Union, which is the Union recognized by the Oilfield Employers' Association and has an agreement providing, amongst other things, for the adjustment of wages in accordance with the cost of living index, warned its members against participating in this strike, and only 1,470 out of the 11,340 workers in the industry came out. The strikers began to return to work early in January. At the time when the strikers began to return to work acts of sabotage were reported, including the burning of oil wells and the emptying of water reservoirs. The Legislature of the Colony enacted an Emergency Powers Ordinance, under which proclamations were issued ordering Butler to leave the area and imposing a nine-hours curfew.
On January 19, Butler established headquarters in Port-of-Spain and was joined by a large number of his followers. Meanwhile, acts of sabotage continued and a large number of Butler's followers on January 20 picketed the main traffic routes and the bus termini and railway stations, and seventy-two persons were arrested by the police. Thirty-two persons were later arrested when a crowd of some 3,000 to 4,000 people went in procession to the Government buildings with the apparent intention to occupy the Legislative Council Chamber. On this occasion the Governor reports that the police were attacked with sticks, stones and bottles and suffered a number of casualties, and were obliged to use tear gas and baton charges. Later, a party of police under the Commissioner visited Butler's headquarters. Trouble followed, and stones and missiles were used. On this occasion, a large number of persons were arrested. Of the persons arrested at various times during these disturbances, a considerable number have been acquitted by the courts and in some cases short sentences of imprisonment have been imposed. The latest reports from Trinidad indicate that order is now normal.
My right honourable friend is anxious to do all he can to help in securing improvement of working standards and labour organization generally in Trinidad and the observance of trade union procedure and practice as understood in this country; and has indicated that he hopes to arrange for a visit by some person with wide experience in these matters with a view to discussion with all parties concerned in Trinidad. Meantime the local Government has set up committees on the revision of wages and salaries of its own employees, and on the means whereby the high cost of living can be reduced. The Standing Price Control Committee is also re-examining the percentage mark-up of goods with a view to reducing prices. Recent increases in the cost of imported foodstuffs and other commodities have entailed serious hardship for large numbers of people in Trinidad.]

PENSIONS (INCREASE) BILL.
Read 3a (according to Order), and passed.
ROAD TRAFFIC (DRIVING LICENCES) BILL.
Read 3a (according to Order), and passed.

SUNDAY ENTERTAINMENTS ACT, 1932 (URBAN DISTRICT OF RAYLEIGH 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 of the Act to the Urban District of Rayleigh, and laid before the House on Tuesday last, be approved—(Lord Walkden.)
On Question, Motion agreed to.

SUNDAY ENTERTAINMENTS ACT, 1932 (RURAL DISTRICT OF ELSTREE 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 Elstree, and laid before the House on Tuesday last, be approved.—(Lord Walkden.)
On Question, Motion agreed to.

SUNDAY ENTERTAINMENTS ACT, 1932 (CITY OF CARLISLE 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 City of Carlisle, and laid before the House on Friday last, be approved—(Lord Walkden.)
On Question, Motion agreed to.

EXCHANGE CONTROL BILL.
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—(Lord Pethick-Lawrence).
On Question, Motion agreed to.
House in Committee accordingly.
[The EARL OF DROGHEDA in the Chair.]
Clause 1 agreed to.
Clause 2:
Surrender of gold and foreign currency.
(1) Every person in or resident in the United Kingdom who is entitled to sell, or to procure the sale of, any gold, or any foreign currency to which this section applies, and is not an authorized dealer, shall offer it, or cause it to be offered, for sale to an authorized dealer, unless the Treasury consent to his retention and use thereof or he disposes thereof to any other person with the permission of the Treasury.
VISCOUNT BRIDGEMAN: Before Clause 2 stands part of the Bill, it seems to me that the House ought to look a little more closely into the question of the authorized dealers. Your Lordships may remember that gold and foreign currency may be retained in the United Kingdom only by those people who are authorized dealers. In talking about "authorized dealers" I would like to say at once that I am not suggesting any criticism of the way in which the Bank of England have dealt with foreign exchange in the past. In fact I would like to say exactly the opposite. In this Bill we restrict the power of dealing in foreign exchange to authorized dealers, and they are also authorized by the Treasury to delegate their powers in different directions; but there is nothing in this Bill to show who is to be an authorized dealer and who is not. It makes a good deal of difference to those who are engaged in foreign exchange that it should be absolutely clear what class of persons are going to be authorized dealers. The permission to specify those who are to be authorized dealers should be permission which does not favour one particular set of people, or one particular interest, against another. I suggest that it might be worth while if we heard something more about the way in which the Treasury intend to deal with this matter.
THE SECRETARY OF STATE FOR INDIA AND BURMA (LORD PETHICK-LAWRENCE): I do not think there is anything on the point raised by the noble Lord which really calls for special comment. There have been in the past some eighty dealers authorized. It would not be possible to single them out by name, but they are the dealers who are in agreement with the British Bankers Association, the Association dealing with Acceptance Houses and one or two other organizations. The practice has been to take their opinion as to who should be authorized dealers.
690
If any persons are left out for any improper reason, they would no doubt have special review and then could be included. It has worked very well in times gone by, and I do not think there is any reason to suppose that the method used of dealing with what in effect is their recognized trade union is not the best that could be adopted.
VISCOUNT BRIDGEMAN: I am very grateful to the noble Lord for his assurance on that point. If I. understand him rightly, it means that the permission to be an authorized dealer is not confined to the membership of certain associations, but that the advice of certain associations is taken before admitting an individual to membership. I wonder if I could have the noble Lord's assurance that I have understood that correctly?
LORD PETHICK-LAWRENCE: That is how I understand it. I would not like to give an assurance without further confirmation, but I think that is so.
Clause 2 agreed to.
Clauses 3 to 16 agreed to.
Clause 17:
Special provisions as to dealing in certain securities.
(2) Except with the permission of the Treasury, no person shall, in the United Kingdom, and no person resident in the United Kingdom shall, outside the United Kingdom, transfer, or do anything which affects his rights or powers in relation to, any security to which this section applies.
2.40 p.m.
LORD HAWKE: My Lords, I should rather like to hear from the noble Lord opposite the precise interpretation put on subsection (2) of this clause, because, as it stands, it appears that under this clause an American, a temporary visitor to this country, would not be able to conduct any operations in his own country whilst staying here. For instance, it appears that he would not be: able to telegraph his broker in New York to sell securities on Wall Street, and if a document were sent to him to sign in this country it would not be legal for him to do so. That is how I read the clause, and I believe that in another place the Chancellor of the Exchequer admitted that that kind of interpretation was correct. Clearly, some sort of permission will have to be given,

691
and I should like to know what form that permission will take, because otherwise the clause would act as a distinct deterrent to foreign visitors of substance coming to these shores.
LORD PETHICK-LAWRENCE: There is no danger of action being taken in the direction to which the noble Lord takes exception. The fact that an American is a visitor to this country will not in the ordinary course prevent his carrying out any transactions on his own stock exchange in his own country, whether he advises his broker by telephone, telegram or letter, nor from doing any business which he has the intention of doing in his own country. The noble Lord need have no fear on that account.
VISCOUNT SIMON: If that is the case, he would not, in the ordinary course, be a person resident in the United Kingdom.
LORD PETHICK-LAWRENCE: It is a general principle, in dealing with persons from a foreign country, that a man may do certain transactions on the stock exchange in his own country, and that does not attract any trouble. What he must not do is to use exchange so as to affect the general position.
VISCOUNT SIMON: I do not think this clause can be interpreted by general principles. Clause 17 says that any person resident in the United Kingdom, but outside the United Kingdom personally, shall do nothing relating to any security to which the clause applies. I appreciate that that can refer only to the securities to which the clause applies, but I must say, in fairness, that it is not clear to me that it is because of some general principle which is involved. It must be because a person is considered not a person resident.
LORD PETHICK-LAWRENCE: The Treasury will give general regulations that all these cases will be covered.
VISCOUNT SIMON: Covered by the phrase "except with the permission of the Treasury." That is right.
LORD HAWKE: I thank the noble Lord for his explanation, and I am happy to accept that the Treasury will make it perfectly clear that it is legal for foreigners to transact business in their own country while staying here.
Clause 17 agreed to.
Clauses 18 to 21 agreed to.
Clause 22:
General restrictions on export.
(1) The exportation from the United Kingdom of—

(a) any notes of a class which are or have at any time been legal tender in the United Kingdom or any part of the United Kingdom or in any other territory; and

(b) any Treasury bills; and

(c) any postal orders; and

is hereby prohibited except with the permission of the Treasury.
LORD MOYNE LORD MOYNE moved, after subsection (1), to insert:
"(2) The prohibition in paragraphs (a) and (c) above shall not apply to the exportation from the United Kingdom to Eire of ten shilling notes, £1 notes, or postal orders."
The noble Lord said: I hope your Lordships will extend your customary tolerance to the shortcomings of a first effort. It is, I believe, usual when one is speaking for the first time, to do so on a non-controversial subject. I feel confident that whether or not my Amendment is acceptable, its aim and object cannot be in dispute. It is designed, perhaps clumsily, to ensure that the normal practice of Irishmen working in this country, or of soldiers, of sending their earnings home to their dependants, shall not be jeopardized by the present Bill. There are, I think, over 100,000 Irishmen and Irish women working in industry in this country, and many thousands serving in the Armed Forces, under obligations which, be it remembered, it is not open to them to break. The great number of these people have dependants at home whom they support. I am told that in 1946 over 4,250,000 postal orders and money orders were sent from the United Kingdom to Eire. I venture to say that in many instances these people would not, and could not, enter into their commitments in this country if they had not been able to count on helping from here those who depend on them at home.
In introducing this Bill in another place, the Chancellor of the Exchequer stated categorically that exchange control would not apply to the sterling area, but Clause 22, by banning the exportation from the United Kingdom of postal orders and bank notes, deprives all those who do not enjoy the benefit of banking accounts of the means of making the payments which

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are allowed. As it stands, the Bill enables the Treasury to grant permission, but when my noble friend Viscount Simon, on the Second Reading in this House, raised the question of postal orders to Eire, the noble and learned Viscount, the Lord Chancellor, who probably meant his words to be more reassuring than they actually were, merely replied: "We intend, if we can, to publish and promulgate some kind of order about it." But, "if we can" is cold comfort for those who have chosen to serve in His Majesty's Forces; "if we can" is not very encouraging to the much-needed help of Irish labour in industry and agriculture; if we can, "sounds rather grim for the people of Achill and other rocky places of the West, from which young men have gone out every year since the days of the famine to lift potatoes in Scotland and England.
If these men could not send or take their earnings home with them it would mean great hardship for themselves and their families. If even any kind of permission had to be sought it would add difficulties to lives already by no means easy. It would no doubt be something gained if the Government were to give at least a positive undertaking that standing permission would be granted. But after all, the Government are not simply seeking power to forbid exportation of these things. They have asked us to do the forbidding, and for all time. How is the unfortunate individual to be sure when and how permission will be forthcoming, when and how it may not be withdrawn? To cover the cases I have mentioned where hardship and injustice might otherwise result, is it not our duty to have a definite exception inserted in the Bill?
No one questions the wisdom of the Treasury in these matters. The firmness and fairness with which they have administered the war-time regulations have drawn praise from every quarter. But, after all, it is a basic principle of our Constitution that we do not give arbitrary power to any branch of the Executive, however wise it may be. Our Executive is subject to rules of law, and the law is controlled by Parliament. The Government recognize this principle by having a Bill and not asking us to vest the Chancellor of the Exchequer with unfettered dictatorial power. As the noble and learned Viscount on the Woolsack very
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frankly conceded on the Second Reading, circumstances have driven the Government some way in this direction; but the Bill at least recognizes that certain matters remain the responsibility of Parliament. Is it too much, then, to ask statutory recognition for this very fundamental right of Irishmen working in the United Kingdom to support their dependants at home? Other departments than the Treasury—the Ministry of Labour, the War Office, the Admiralty, the Air Ministry, the Ministry of Agriculture—are affected. Eire is differentiated from the remainder of the scheduled territories by reason of the land frontier with Northern Ireland and by reason of the number of her citizens working and serving here. A question of principle is involved, especially for those serving with the Armed Forces, and in my humble submission the safeguard should be provided by Parliament. I beg to move.
Amendment moved—
Page 16, line 4, at end insert the said new subsection.—(Lord Moyne.)
THE EARL OF DONOUGHMORE: May I say one word in support of what has been said by my noble friend opposite? First, however, I should like to say how pleased I am that the son of an old friend has made his first speech in your Lordships' House. The matter' with which his Amendment deals is one with which I am in rather close touch myself. I have half a dozen people from my own employment here in this country, and in the cases of four of them their homes are actually outside my own lodge gates in Ireland. I know that they send small but very useful postal orders back to the people at their homes, and the receipt of those postal orders is very much appreciated. If one of your Lordships wishes to remit money to Ireland—I will not say for what purpose, but, possibly, it might be in order to buy a ticket in a sweepstake—he can do so by sending a cheque. These people, of whom my noble friend speaks, have no banking accounts, they cannot have banking accounts, and they do not want them. I do not know if the wording of my noble friend's Amendment is satisfactory in the view of the Government, but I do suggest that this is a point which ought to be dealt with, otherwise great hardship may be caused now and in the future.
LORD PETHICK-LAWRENCE: May I, as a comparative newcomer to your Lordships' House, join with the noble Earl who has just spoken in paying a tribute to the noble Lord whom we are very glad to hear speak in this House for the first time to-day Like the noble Earl, I knew his father and I crossed swords with him in another place. In fact, I think that he succeeded me as Financial Secretary to the Treasury. I hope that this will not be the last time that the noble Lord, Lord Moyne, will take part in a debate in your Lordships' House. With regard to the Amendment which the noble Lord has moved, I am fully in sympathy with its intention, but I do not feel that we can carry out the noble Lord's intention in the way in which he proposes. We are, at present, perfectly happy to allow sterling notes to pass between the United Kingdom and Eire, and we think that it will also be practicable to extend this freedom to postal orders. That is, because of our happy relations with Eire in this field. The exchange control of Eire works harmoniously with our own, and her economy is so closely linked with sterling that this freedom is natural, and shelters no major abuses.
But this Bill is a permanent measure, and it is essential for the Treasury to have power to take action in hypothetical circumstances which might arise, and which could, in an incredibly short time, do incalculable damage, if that power did not exist. This point applies to many clauses of the Bill. The Lord Chancellor dealt with it in the speech which he made on the Second Reading, to which reference has already been made. Therefore, instead of altering the text of the Bill and whittling down the rights of the Treasury, the Government are of the firm opinion—and that opinion is shared by financial authorities—that the right way to proceed is to give the Treasury very wide powers, and the Treasury will, naturally, issue orders to make it clear that so far as ordinary transactions are concerned there is no need to clamp down in any way.
In another place, the Chancellor of the Exchequer made it clear that, simultaneously with the coming into force of the Bill, a whole series of Treasury Orders, mainly under Clause 31, will be promulgated relaxing the severity of the
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measure where practicable, so that the day-to-day effect of exchange control will be far less rigorous than a reading of the Bill might suggest. Points to which this Amendment is directed will be covered under such an Order. The significant fact is that all such Orders can be modified or withdrawn quickly if need arises. In view of that assurance, given by the Chancellor of the Exchequer in another place, I hope that the noble Lord, Lord Moyne will feel able to withdraw his Amendment.
VISCOUNT SIMON: I hope that the noble Lord who moved this Amendment will be glad to accept that assurance. Certainly I would most respectfully advise him to do so. I rise, however, to make two observations. I hope that the noble Lord opposite does realize—I think that anybody who has in his composition any remains of Liberal tradition ought to do so—that the method by which he is proceeding cannot be regarded as a good maxim of legislation in general. He says that the authorities are all of one mind that you should give to a Government Department very wide powers, excessively wide powers, and then, having gone far beyond anything which is really intended or really reasonable, you should whittle them down to what is thought to be tolerable by excessive use of Departmental exceptions. I agree that that is a way of legislating. You could legislate that everybody shall be hanged and then say: "Oh but some Government Department will issue exceptions which will limit the hanging to cases of murder." It is really too ridiculous to suggest that this is a good maxim to follow in the framing of legislation.
It may be an unhappy necessity, but I hope that it is not going to go forth even from one side of the House (and I do not think it is, for I see some noble Lords sitting opposite who, I am sure, do not feel that this is a good maxim) that you ought, as an ideal, to present to Parliament what have been described as very wide powers, leaving it unconditionally to a Department to bring them back to what is reasonable, simply saying that the Department will, in all proper cases, grant an exception or a permission. The second matter to which I wish to refer is this. I was very glad to have my attention called to Clause 31, and I am sure that my noble friend, no less than myself,

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will accept the assurance exactly as it was given. But I would just point out, in passing, that I have not, as yet, found anything in the Bill which announces or makes any provision for announcing what the Orders in question are to be. I hope that when we are dealing with the Bill in its later stages we shall consider whether if, as may happen, there are going to be a great number of exceptions by Order, there ought not to be in the Bill something which secures that the public shall know what those Orders are.
LORD PETHICK-LAWRENCE: I do not, think your Lordships will expect me to follow the noble and learned Viscount into the picturesque simile that he used regarding methods of legislation. I think it is in Ruddigore that a passage occurs in which a large number of criminals are waiting to be thrown to the crocodiles. One of those so condemned says that he is looking forward to it, because in the long chain of persons who are going to be thrown to the crocodiles are some of his bitterest enemies, and as their turns will come before his they will not have the treat of witnessing his struggle. On the general matter raised by the noble and learned Viscount I agree. I do not think it is an ideal form of legislation. Quite obviously, it is not desirable in most laws to make provisions of this kind and then say that there are large categories of persons who should be exempt. I agree that that is not an ideal method of legislating in general. The trouble with exchange control is that one lapse for a very short time may produce very damaging results before it is possible to make a law. The noble and learned Viscount has been Chancellor of the Exchequer and he knows how in the annual Budget it is very difficult to keep up with the crooked ways by which certain people who should be taxpayers succeed in finding loopholes in existing Statutes, and getting away with unfair advantage as a result.
LORD HAWKE: Would the noble Lord let us know why it is crooked to do something which is allowed by the law?
LORD PETHICK-LAWRENCE: I think I will leave the noble Lord to the noble and learned Viscount over there, because I am quite sure the noble and learned Viscount knows quite well that while it is perfectly legitimate to use the law in the manner that we should not pay more tax
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than the law would oblige, there have been practices adopted which quite clearly do not belong to that category; and Chancellors of the Exchequer have had to recognize it by making retrospective legislation. Retrospective legislation is even less desirable than the provisions in this Bill to which the noble and learned Viscount is taking some exception. But the net result is that it: is absolutely essential that we should stop up possible loopholes by which exchange can be played about with to the detriment of this country. The fact that large masses of exchange could be disposed of before there was time to stop up the leak by legislation makes it essential for the Treasury to have the powers. Therefore, although I agree with the noble and learned Viscount generally, in this particular matter of exchange control I think it is necessary to have these wider powers.
LORD MOYNE: The Government feel the need is for urgency in some hypothetical case if Eire should wish to leave the sterling area. Would it not meet the Government's difficulty if my Amendment were to be framed as it is, but with the words added: "So long as Eire remains within the scheduled territories"? In the case of emergency it could only be if Eire were leaving the scheduled territories. Would such an Amendment be acceptable?
LORD PETHICK-LAWRENCE: I am afraid we cannot meet it in that way.
LORD GIFFORD: Would it not be possible to limit the amount of any particular gift? Would that not meet the case?
LORD PETHICK-LAWRENCE: I do not think you could do that.
LORD MOYNE: I was very unhappy about the Government's doubt on the subject of postal orders, because that is the point that would hit the small man so hard. I can see no reason for not classing postal orders with pound notes or treasury notes. Postal orders are limited in amount—apart from money orders—to one guinea. I think that the Government might be able to give us an assurance on postal orders as on the subject of ten shilling and pound notes.
LORD PETHICK-LAWRENCE: I do not think any hardship is involved because these things will become legal and will be permitted.
LORD MOYNE: On that assurance, I am very happy indeed to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 22 agreed to.
Clause 23:
Payment for exports.
(1) exportation of goods of any class or description from the United Kingdom to a destination in any such territory as may be prescribed is hereby prohibited except with the permission of the Treasury, unless the Commissioners of Customs and Excise are satisfied—
(b) that the amount of the payment that has been made or is to be made is such as to represent a return for the goods which is in all the circumstances satisfactory in the national interest:
(3) Any reference in this section to the destination of any goods includes a reference to the ultimate destination thereof.
3.5 p.m.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved, after paragraph (b) of subsection (1), to insert:
"In cases where the Commissioners of Customs and Excise consider that the payment is not such as to represent a return for the goods satisfactory to the national interest the Commissioners of Customs and Excise shall declare to the person or persons wishing to export the goods, or to whom payment for the goods would, be made, the reasons for such decision, and shall give such person or persons opportunity of making representations to them concerning the proposed transaction."
The noble Lord said: As the Bill is at present drafted, Clause 23 prohibits the export of goods of any class or description except with the permission of the Treasury, unless the Commissioners of Customs and Excise are satisfied. The Bill describes two particular conditions on which the Customs and Excise must be satisfied, one being:
"… that the amount of the payment that has been made or is to be made is such as to represent a return for the goods which is in all the circumstances satisfactory in the national interest."
Thus it gives to the Governmental authorities enormous powers. It means that unless the Customs and Excise are satisfied that the return is adequate, virtually no export trade can be carried on.
It may well be that under the present circumstances these powers are, in general, necessary. I think they are
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necessary, and one has to admit that fact. But it does seem to me a very wide definition to say that the payment must represent a sum which, in all circumstances, is in the national interest while at the same time you give no opportunity for the trader to make representations as regards the customs of his trade. Indeed, it does not give the trader any opportunity to request—I will not use the word "demand"—the right to receive from the Customs and Excise the reasons why the Customs and Excise would consider the return is not adequate in the national interest in all circumstances. "Satisfactory to the national interest" means, in fact, that the Customs and Excise can question the cost charge for any of our exports. It will make it extraordinarily difficult for traders in the future to be able to fix terms ahead as regards transactions if the transaction is liable to be reopened because the payment to be received is not considered by the authorities to be in the national interest.
I do not think that the Customs and Excise are really the right people to judge what, in all the circumstances, is a return adequate in the national interest. After all, every trader has to what is called "nurse clients" at certain times. In the export trade it is sometimes necessary to sell goods at an uneconomic price in order to create a market. On a short-term basis that might not give a return for these goods satisfactory in the national interest. I am quite sure the Customs and Excise are reasonable men, and that if they had an opportunity of hearing that it is a short-term act in a long-term policy of developing a market, they would probably accede to the opinion of the manufacturer. Therefore I suggest two things: first, that the Customs and Excise should be under an obligation to declare the reasons at any time as to why they consider a return is not in the national interest, and secondly, that having done so, they should allow the trader an opportunity to make his representations as to why he considers the Customs and Excise are in the wrong, and why he is justified in putting forward his proposition for a particular commercial transaction. We on this side of the House are not in any way trying to help someone to do something that is dishonest or near the mark. What we are trying to do is to see that the honest trader of this country is not

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throttled unnecessarily. If the Government must have these powers, and I agree that the Government have to have them now, let them be powers which are not used unilaterally and arbitrarily.
Amendment moved—
Page 16, line 23, at end insert the said words.—(Lord Balfour of Inchrye.)
LORD HAWKE: I would like to support my noble friend. If we have to have this horribly clause I feel that the Govern-merit simply must accept some sort of Amendment of this nature. Imagine the situation of a merchant who has to sell his goods ahead, before shipment, and when he comes to ship the goods the Commissioners of Customs and Excise say: "The invoice price is not in the national interest." What is he to tell his overseas buyer, unless he can go to the Commissioners of Customs and Excise and receive some sort of reason for their action? He could not tell his buyer anything except that the authorities refused to allow him to ship. This might be considered a slur on his own name, or some "pig-headedness" on the part of the authorities. I feel that some provision of the nature suggested is essential.
LORD PETHICK-LAWRENCE: I quite appreciate the point made by the noble Lord opposite and supported by the noble Lord, Lord Hawke. This Amendment states exactly what is the existing practice of the Commissioners of Customs and Excise, which will certainly continue under the new Act. The previous practice has always been to do what is the reasonable thing. It is inconceivable that the Commissioners of Customs and Excise should arbitrarily come down on a trader and say: "You have not to do this"; that they should not have a discussion with him, explain their actions, get his rejoinder, and, if that seems adequate, give way on the point. I do not think that there is any object in putting this proviso into the clause, because there are many other matters which might equally be put into the Bill.
For example, let us suppose that a person has to be searched. A provision might be put in to the effect that the search shall not be carried out in an unreasonable manner, in a cold, draughty place, but shall be conducted properly, in certain circumstances, and so on. One does not put those things into a Bill, because that is part of the reasonable
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action. Here we have something which has not given rise to the kind of arbitrary behaviour to which the noble Lord has called attention. It has not been done in the past. There is no ground for supposing that it will be done in the future. If in every case where a thing had to be done in a reasonable way, a stipulation were put into the Bill that it had to be done in such and such a way, and that it would be most unreasonable if it were not done in that way, we should double the length of the Bill, and not: get any further. For that reason I am afraid that I cannot agree to this being put into the Bill.
LORD BALFOUR OF INCHRYE: Might I ask this question? If this is virtually the practice, is it not a matter of sufficient general importance to be put into the Bill? The noble Lord drew a distinction between a particular case where individuals were searched and something which affects the broad principles of our trade. If this is the practice, I submit that the aim should be to try to put into the context of the Bill as much as possible of the broad principles which animate it. Let me remind the noble Lord that in another Bill, namely, the Coal Industry Nationalization Bill, in this House we had to pass a clause which allowed for certain parties to make representations with regard to particular actions which the Government might take. The noble and learned Viscount, the Lord Chancellor, who was piloting that Bill, was good enough to accept that Amendment and did not use the argument which the noble Lord used just now, which was to the effect that if you put one thing in the Bill you will have to put everything in the Bill. If he will allow me to say so with respect, I do not think it was a very convincing answer. I am not sure that a matter of such general principle should not be inserted in the Bill.
VISCOUNT SIMON: I am very sorry that the answer which has been given by the noble Lord opposite should have been given. His analogy is as far-fetched as he thought mine was on an earlier clause. I quite understand the natural desire of anybody in charge of a Bill to keep it in the shape in which it is. People sometimes wish that because they hope to avoid a discussion in another place. Just consider the clause as a whole. The clause makes some provision as to how the Commissioners of Customs and Excise are to arrange their work. Just see what

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the clause says—what it has been thought worth while to insert in the Bill—and consider whether it is not necessary to have a supplemental clause. Subsection (2) states:
"For the purpose of satisfying themselves in the case of any goods as to the matters specified in subsection (1) of this section"—
one of those things is the question of what is a price satisfactory in the national interest—
"… the Commissioners of Customs and Excise may require the person making entry of the goods for export to deliver to the collector or other proper officer together with the entry such declarations signed by such persons as the Commissioners may require, and where any such declaration has been so required the goods shall not be exported until it has been delivered as aforesaid."
Your Lordships will note that the Government think it worth while to put into the Bill that the Commissioners shall be entitled to administer these interrogatories to the trader. But when it comes to the trader saying, "May I also have it on record that I may know from the Commissioners why they are taking the view which they propose to take, and may I have right of access to the Commissioners in order that I may point out to them that the circumstances of my case are not what they suppose?", there is nothing about that in the Bill.
Every possible facility is given to the Department not only to ask questions but to insist on an answer under pain of certain penalties, but nothing whatever is put into the Bill on a matter which affects a trader and which, as I understood the noble Lord opposite, is in fact what he recognizes as entirely reasonable and fair. I am not for a moment suggesting that the Commissioners of Customs and Excise would not wish to act reasonably and fairly. That is not the point. This is a very good illustration of taking power wider than one really needs, refusing to concede what one ought to concede, and saying: "It will be all right in the end, because look how reasonable Departments are in this free country." I do not think that is good enough. I hope that this Amendment, which admittedly is an Amendment which will not in the least alter the practice, will be added to the Bill.
LORD PETHICK-LAWRENCE: I still do not think that there is any great object in this Amendment. The practice of the
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Treasury will continue to be the practice, and traders, so far as I can see, have no ground for imagining that it will not be. However, if noble Lords opposite take a strong view about this matter and feel keenly about it, I will agree to have it looked into again, to see if we can meet them on the Report stage.
LORD BALFOUR OF INCHRYE: I am very grateful to the noble Lord for his assurance that he will look into this matter between now and the Report stage. I should be very grateful to him if, through the usual channels, he could let us know before the Report stage the result of his deliberations. On that assurance, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
VISCOUNT BRIDGEMAN VISCOUNT BRIDGEMAN moved to leave out subsection (3). The noble Viscount said: Perhaps the noble Lord opposite will not feel that this Amendment is open to the objection which he found to the last one—namely, that it makes the Bill longer. I am well aware—as we all are—that this was a matter which was fairly fully discussed in another place. None the less I think that your Lordships should pay careful attention to this clause, because I, for one, do not see exactly how this can be implemented. I think it is wrong to have a clause like this in the Bill when it is almost impossible to make certain that it is carried out in day-to-day commercial business. I should like to be clear as to how noble Lords opposite think that this subsection is going to be carried out. For instance, let us imagine a cargo of, say, textiles or electric motors, or something of that sort, consigned to Singapore, Rotterdam, or any other port. What is the ultimate destination, and how can the exporter possibly know what the destination of these goods is going to be, beyond the destination expressed in the invoice? That is a matter of pure conjecture.
If your Lordships want a slightly more far-fetched case let us imagine that a cargo of explosives is consigned to a Near Eastern country and a Near Eastern port. What does one suppose will be the ultimate destination of those explosives, and how would it be wise to try and deal with such a case under the Bill I seriously suggest either that my Amendment is accepted, or that the noble Lord opposite should consider some other form of words in reference to the destination, and relate that reference to the person to whom the

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exporter looks for payment rather than oblige the exporter by law to do something that is likely to be quite impossible. I beg to move.
Amendment moved—
Page 16, line 40, leave out subsection (3).—(Viscount Bridgeman.)
LORD PETHICK-LAWRENCE: I think I can satisfy the noble Viscount on this point. I believe he is under a slight misapprehension. "Ultimate destination" obviously does not mean, and could not mean, the ultimate place to which the goods may go in the course of time. Those words mean the ultimate customer to whom the goods are sent by the exporter. What we are trying to prevent is the case where a man is in fact going to send goods to America although the boat calls at Cherbourg on the way. He should not be able to get away with the idea that the goods are going to Cherbourg, having sent previous instructions to his agent in Cherbourg to send them on to the United States. That must be stopped. If a man sends goods to a New York buyer, his real customer, and after the man has dealt with the matter the New York importer chooses by some other means to send them to Mexico, to the Argentine, or anywhere else, that does not come under the phrase "ultimate destination." I think that the point which the noble Viscount quite rightly made is met, because the words "ultimate destination" fall to be construed, if necessary by a court, as the last point with which the exporter is concerned. I hope that the noble Lord will be satisfied with that explanation.
VISCOUNT SWINTON: Is the word "ultimate" defined in the Bill? I do not dissent from what the noble Lord has said. I have had a good deal of experience the other way round, of goods consigned from a country, and one wants to know what was the country of origin. It was a very common practice in the days of differential duties, when people wished to evade the duty. It seems to me that "ultimate" is not the right word, and what we want is something like "bona fide." I do not know whether the word "ultimate" is defined in the Bill, but in any event I feel that what is wanted is something like "genuine" or "bona fide."
THE LORD CHANCELLOR: The word "ultimate" is not defined in the
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Bill. I feel certain that as a matter of construction you must regard "ultimate" in the context of the particular exporter. You cannot possibly have regard to what the exporter sells, and then say that what he may do with the goods has nothing whatever to do with it. I am sure the word "ultimate" will have to be construed as "ultimate quoad the exporter."
VISCOUNT BRIDGEMAN: I am quite at one with the noble Lord in wishing that the practices which he mentioned should be stopped. I think we all agree about that, but I still do not feel that these words "ultimate destination" are the clearest possible words which we can find for expressing what is wanted. If "ultimate destination" is the expression that is thought to be wanted, I suggest that at any rate there should be a reference to it in the interpretation clause, and actually there is not. I hope, therefore, that we may have an assurance that the matter will be looked into, and that we shall not be left with words which, if I heard aright, may still remain in doubt until they are interpreted in the courts.
LORD PETHICK-LAWRENCE: I do not think there is any real doubt here.
VISCOUNT SIMON: I would just like to point this out. In view of the fact that a price is to be examined to consider whether or not it is in the national interest—and here I agree with the noble and learned Viscount, the Lord Chancellor—it is pretty clear that what is referred to is the transaction between the exporter and his customer. But would it not be well to consider whether the word "ultimate" is not perhaps an ambiguous word? What is the matter with substituting a phrase like "bona fide," or some other word? I do not think it can be doubted that the noble Lords who have raised this question are very familiar with the position, and they are certainly not trying to waste time. I should have thought it might be reasonable to say, in answer to the point, that as a matter of language it would be considered.
LORD PETHICK-LAWRENCE: The matter has already been considered very carefully, and I do not think we shall find a better word.
VISCOUNT BRIDGEMAN: In that case, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 23 agreed to.
Clause 24:
Duty to collect certain debts.
(2) Where a person has contravened the provisions of subsection (1) of this section in relation to any specified currency or payment in sterling, the Treasury may gibe to him or to any other person who appears to the Treasury to be in a position to give effect thereto (being a person in or resident in the United Kingdom) such directions as appear to the Treasury to be expedient for the purposes of obtaining or expediting the receipt of the currency or payment in question, and, without prejudice to the generality of the preceding provisions of this subsection, may direct that there shall be assigned to the Treasury, or to such person as may be specified in the directions, the right to receive the currency or payment or enforce any security for the receipt thereof.
3.25 p.m.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved, in subsection (2), to leave out "contravened" and insert "been convicted of contravening." The noble Lord said: The Bill as drafted at present says that where a person has contravened a provision of this particular subsection the Treasury may give to that person orders as to what he is to do with certain funds. The purpose of the Amendment is to make it clear that a contravention can only take place after conviction by a court of law. As I read the Bill at the present time, it seems to me that the Treasury can make a unilateral declaration that contravention has taken place, and therefore the man in question must comply with the Treasury direction. I am conscious that I am swimming in very strange waters—the waters of expert legal knowledge—but it does seem to me that here we are introducing a new principle, that a Government Department can itself declare that a contravention has taken place. That might lead us anywhere.
Supposing that the Chancellor of the Exchequer were temporarily short of funds, could he go round to everyone and say: "You have been contravening, and therefore the Treasury is going to give you certain directions. Please hand us your money"? That seems to me perhaps a rather exaggerated example, but nevertheless a possible example of what might happen if the Treasury were allowed to say on its own order that a contravention
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had taken place. This matter was debated in another place, and there—with respect to the Solicitor-General—it seemed to me that no satisfactory answer was given. I hope, therefore, that the Government may be able to accept this Amendment. At the same time I would very much like to know who is to decide that a contravention has taken place, if the Government maintain that a conviction in a court of law is not a necessity, and what is to happen if the Treasury takes it on itself to say that any contravention has taken place, and the man denies such contravention. Does the matter then go to law, or does the Treasury Order hold sway? I feel that this is a matter that does need some elucidation, and I beg to move the Amendment.
Amendment moved—
Page 7, line 21, leave out ("contravened"), and insert ("been convicted of contravening").—(Lord Balfour of Inchrye.)
THE LORD CHANCELLOR: The noble Lord has swum very gallantly in these strange waters, and if I may I will try to help him to get safely to land. I think the real position under this clause is as follows. The condition of the Treasury making these directions is that a man has contravened. If the man has not contravened, then it follows from the clause that the Treasury have no right to give these directions. Suppose the Treasury think a man has contravened and thereupon give him directions, and suppose the man is quite sure he has not contravened. In those circumstances he is perfectly entitled to go to the court, and if he can establish that he has not contravened, he knocks away the foundation upon which the Treasury direction is issued. The Treasury direction falls to the ground at the same time as the courts say the man has not contravened. I think it is so far quite plain. As a matter of practical politics, it is interesting to note that there never has been such a case.
The practice in these matters is that if the creditor over here has sent goods to America and there seems to be no hurry on the part of the American to pay for them (sometimes one rather suspects that it may be that the creditor over here is telling his friend in America not to hurry unduly), the Treasury come along and say: "Look here, this is not good enough; you must really write to your American friend and wake him up." In practice

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the letter so suggested by the Treasury—or, if you like, drafted by the Treasury—is the direction. That is the way in which the thing works; and it has worked with perfect smoothness, although I suspect there may have been cases in which the creditor over here has said to the debtor in America, "Never mind what letters I write you hereafter—they will be inspired by the Treasury. Do not you pay. "There may have been such cases as that but, broadly speaking, the scheme has worked very well. It would make it quite impossible for the Treasury if, before they issued any direction, somebody had to go to the courts and get a ruling as to whether or not a man had contravened. The right way in which to do it is to keep it as it is, always preserving the individual's right—a right which in seven years has never been exercised—to go to the court and say, "These directions are all invalid; I have not contravened at all."
LORD BALFOUR OF INCHRYE: I thank the noble and learned Viscount for his explanation, which I look forward to reading in Hansard and digesting at my leisure. In view of the explanation I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 24 agreed to.
Clause 25:
Duty not to delay sale or importation of goods.
(1) Where—

(a) any permission or consent has been granted under this Act, or under any corresponding provision of the law in force in any territory comprised in the scheduled territories, subject to a condition providing that, or on the faith of an application stating an intention that, any goods should be sold outside the scheduled territories; or

(b) any statement or declaration has been made under any provision of this Act or any such corresponding provision as aforesaid that any goods are to be sold outside the scheduled territories; or

(c) any currency has been obtained in, or by any person resident in, the scheduled territories on the faith of an application stating an intention that any goods should be sold outside the scheduled territories,

then, except with the permission of the Treasury, no person resident in the United Kingdom who is entitled to sell or procure the sale of the said goods shall do, or refrain from doing, any act with intent to secure—

(i) that the said sale is delayed to an extent which is unreasonable having regard to the ordinary course of trade; or

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(ii) that, on the said sale, any payment made for the goods is not made in the manner indicated by the condition, statement, or declaration, as the case may be.

LORD HAWKE LORD HAWKE moved, in subsection (1) (c) (ii), after the second "made" to insert "materially". The noble Lord said: My object in putting down this Amendment is to try to introduce a little flexibility into what may otherwise prove to be a very wooden form of procedure. I have in mind a case where an exporter has passed his invoices, and so on, through the Customs, where the goods are on their way and where the importer in the other country says that he cannot adhere to the original terms of payment but wishes to make some small change, perhaps to conform with his local Finance Regulations or to conform to a changed state of his pocket. It seems that if an exporter agrees to make some trivial change in the method of payment he may lay himself open to a charge of doing an act to secure that payment was not made, and so on. I should to receive an assurance that any such composition, if I may so call it, which an exporter accepts will not be held against him as an act done with intent to secure. I beg to move.
Amendment moved—
Page 18, line 13, after ("made") insert ("materially").—(Lord Hawke.)
LORD PETHICK-LAWRENCE: The suggestion underlying this Amendment is that modification as to payment ought to be possible without getting Treasury permission, provided that the modification is not material. The point, of course, is who is to judge what is material and what is not material. Let me give an illustration. Suppose a London merchant has been allowed to buy American goods on the condition that they are sold in the Argentine for Argentine sterling, and diverts them to Greece, so that they are sold for Greek sterling. He may think the difference is immaterial because in each case he gets sterling, but the national interest is very much concerned with the source and type of sterling used in payment for our exports because different holders of sterling vary in their claims on us. Only the Government, with its up-to-date knowledge of a complex and changing system, can decide what to allow and what to disallow. As a result, it is proposed in this Bill that the exporter must go to his bank, if for any

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reason he is unable or unwilling to fulfill the terms on which the exchange was made available to him, and get permission accordingly. If we depart from that principle we shall, I am afraid, get into deep waters. We cannot leave it to the man to decide whether the alteration is material. The right way in which to do it is for him to go to the bank and inquire whether the alteration proposed is such as seriously to affect the nature of the transaction.
LORD HAWKE: May I ask the noble Lord a question? Has the bank power to decide trivial matters without reference to the Treasury? The instance the noble Lord gave was a far more serious change in the method of sale than I contemplated. I contemplated something trivial like a demand draft instead of telegraphic transfer. Has the bank power to decide that on the spot If so, that would satisfy me.
LORD PETHICK-LAWRENCE: A bank has power delegated to it by the Bank of England, the Treasury or whoever it may be, and acts reasonably. In the matter of any small modification which quite obviously made no difference the bank could decide for itself.
LORD HAWKE: With that assurance, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 25 agreed to.
Clauses 26 to 29 agreed to.
Clause 30:
Companies.
30.—(1) Where there is served on any person resident in the United Kingdom a notice in writing that the Treasury wish any such requirements as are hereinafter mentioned to be complied with by any such body corporate as is specified in the Second Schedule to this Act (hereafter in this subsection referred to as a "foreign company"), and that person can, by doing or refraining from doing any act,—

(a) cause the foreign company to comply with any of the requirements; or

(b) remove any obstacle to the foreign company complying with any of the requirements; or

(c) render it in any respect more probable that the foreign company will comply with any of the requirements,

then, except so far as permission to the contrary may be given by the Treasury, that person shall do, or, as the case may be, refrain from doing, that act.
LORD RENNELL: Perhaps I may be forgiven if I return to a point I raised on
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the Second Reading concerning Clause 30. It is to ask once more if the Government will, between now and the Report stage, consider seriously whether Clause 30 should remain in the Bill. I do not want to reiterate the arguments I used on the Second Reading. I have well in mind the observations which the noble and learned Viscount made at the conclusion of that debate. I am quite aware of the purposes of this clause and also of the type of company to which it refers. I am also aware that existing Regulations cover that particular point. There is, however, the distinction to be made that those Regulations were made in time of war, when a lot of things could be permitted, or might have been desirable or could be excused, in regard to foreign companies which are much more difficult to excuse in peacetime.
The real point at issue is this. There may be some foreign companies—subsidiaries to companies in this country or controlled by evilly-intentioned persons in this country—which exist for the purpose of evading exchange Regulations or of depriving this country of the benefit of certain foreign exchange. For that purpose it is considered necessary to put pressure on the people controlling those foreign companies in this country. I agree that that may be desirable and I do not doubt that this clause has been inserted in the Bill because those powers have been considered to be necessary and still are considered to be necessary, but they cannot be powers which have been very frequently invoked or which are likely to be frequently invoked in the future. The real point at issue is that here is a Bill which will shortly become an Act of Parliament in this country in which powers are given in black and white to put pressure on a foreign company.
Subsidiary companies in this country, owned by foreign concerns, are subject to the law of this country. Subsidiary companies in other countries—in Ruritania, or whatever other country—are subject to the laws of that country. For the purpose of protecting ourselves against the two or three cases of this sort which may arise, I think it is using an extremely dangerous weapon which other countries may use against us in circumstances that we would not consider justifiable. In other words, it opens the way to another country retaliating—and retaliating in quite

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different circumstances—with only a slight modification of the words used. I ask the noble Lord who is in charge of this Bill to consider between now and the Report stage whether it is not very dangerous to have this clause in an Act on our Statute Book for the sake of stopping two or three crooks in this country who may be apprehended by other methods. In all these matters there are other ways of killing a cat than by drowning it. I wonder whether, for the sake of one or two, this very difficult and serious principle of putting pressure upon a foreign company ought to find its place in an Act.
VISCOUNT BRIDGEMAN: I do not wish to take up the time of the House, and I rise only to say that I am in very full agreement with what the noble Lord has said, as I believe are other noble Lords.
LORD PETHICK-LAWRENCE: There are two kinds of transactions which are dealt with by this clause. There is one where you have a purely bogus company, to which the noble Lord himself referred, and in that case these powers ought to exist. The other case is that of a perfectly genuine company with a subsidiary abroad, and the question is whether that company should be allowed, for perfectly bona fide reasons, to pursue its transactions abroad without regard to the national interest. They may be perfectly legitimate transactions in themselves, and yet it may not be in the interest of this country as a whole that they should be carried out. To give one illustration, a company in this country may wish unduly to stockpile in various other countries. It may be in the interest of that particular company, but: at the same time it may be that we cannot afford a transaction of that kind to be carried out, and we have to prevent it.
I can assure your Lordships that the powers have been, and will continue to be, used sparingly, giving full weight to the considerations mentioned in the suggestion put forward by the noble Lord. It is certainly not the intention or the policy of His Majesty's Government to force the liquidation of successful British subsidiaries abroad; quite the contrary. We desire to assist them, within the severe limits of the means at our disposal, to become even more successful. We have no desire to kill the goose that lays the
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golden egg, but we feel that these powers must be in reserve. I can give the assurance—which I think is really what the noble Lord desires—that they will be sparingly used, and that the interests of the subsidiary will, in the main, be taken fully into account.
VISCOUNT SWINTON: I really think the noble Lord has missed the point Lord Rennell was advancing. I accept entirely that these powers are going to be sparingly used in the way the noble Lord has indicated. Frankly, I did not think that the instance he gave was a very good one, because he said we might want to stop a subsidiary company in a foreign country stock-piling to excess. There is a very simple way in which that can be dealt with, because we row have to have a permit for everything we do—and, indeed, before we do it. It appears to be perfectly simple to control that matter by the system of export permits from this country. If you do not give a company the materials they cannot export in excess. You are taking tremendously wide powers here which, although they are not going to be exercised very often, are creating a precedent. This is very likely to be prayed in aid by foreign countries not nearly so careful, nor nearly so meticulous, in carrying out the powers they take.
You may say that foreign countries will do what they like, but there is great respect for this country abroad. There is a great respect for our legal system, our commercial practice and our commercial court. It is common knowledge, as the noble Viscount, the Lord Chancellor, will know, that wherever a contract is made, arbitration is by an English arbitration and takes place here, governed by our law, and our trade rules. Those things are important and we want to be careful before we put in an Act of Parliament something which might be cited by others as a precedent of the way in which the English legislature works. I think I have understood what is in the mind of the noble Lord, Lord Rennell. If there is some way in which this can be done, then I think it would be wise to reconsider this clause.
LORD RENNELL: The noble Viscount who has just sat down has made my point. I am not questioning that there are cases where this power ought to be used, but I wonder whether it is worth

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while running the risks to which I have referred by getting those powers in an Act and inviting reprisals. I wonder whether it is not better to suffer whatever loss may be suffered—which, on the showing of the noble Lord himself, is likely to be small, because the powers will be very sparingly used. For the sake of those few instances I do ask the noble Lord to consider between now and the Report stage whether it is wise to invite the reprisals which this clause might promote.
VISCOUNT HALL: I apologize for interrupting the business before your Lordships House, but I ask permission to make a statement. I therefore move that the House be now resumed.
Moved, That the House do now resume.—(Viscount Hall.)
On Question, Motion agreed to, and House resumed accordingly.

PALESTINE.
3.50 p.m.
VISCOUNT HALL: My Lords, the following is a statement on Palestine which is being made by the Secretary of State for Foreign Affairs in another place, and according to the usual practice your Lordships would wish it to be made also in your Lordships' House.
The following is the statement:
I am sorry to have to inform the House that the Conferences with the Arabs and the consultations with the Zionist Organization about the future of Palestine, which have been proceeding in London, have come to an end because it has become clear that there is no prospect of reaching, by this means, any settlement which would be even broadly acceptable to the two communities in Palestine. Ever since they have taken Office the Government have laboured incessantly to find a solution to the Palestine problem. Most members on this side of the House believed that no solution could be found along the lines of the White Paper of 1939, and the Government, therefore, addressed themselves at once to the task of devising a different approach on which they could negotiate with the parties concerned.
In view of the keen interest shown by American Jewry in the aspirations
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of Zionism it was thought desirable that the Government of the United States should be associated with this endeavour and as a result an Anglo-American, Committee of Inquiry was appointed in November, 1945. At the same time it was decided that Jewish immigration into Palestine should be temporarily continued at the rate of 1,500 a month notwithstanding the limits set by the White Paper, and an additional 21,000 Jews have already been admitted. When the Report of the Anglo-American Committee was received we agreed with the United States Government that it should be examined by British and American officials. They jointly recommended the plan of provisional autonomy which was described by my right honourable friend the Lord President of the Council on July 31, 1946.
This plan gave us a basis for negotiation with the parties concerned and no time was lost in inviting them to confer with us. Neither of the two communities in Palestine accepted this invitation, but a conference with representatives of the Arab States was opened in London in September of last year. After an adjournment, due to the meeting of the General Assembly of the United Nations, the Conference was resumed in January, the Palestine Arabs then joining in the discussions. The Jewish Agency have throughout refused to participate in the Conference, although informed that all proposals would be open for discussion, but it has been possible in this last phase to have conversations on an informal basis with representatives of the Agency.
From the outset both Arabs and Jews declined to accept as a basis for discussion the provisional autonomy plan put forward by His Majesty's Government. The Arabs put forward an alternative proposal, under which Palestine would achieve early independence as a unitary State with a permanent Arab majority. His Majesty's Government, seeing no prospect of negotiating a settlement on that basis, put forward new proposals of their own. These envisaged the establishment of local areas, Arab and Jewish, with a substantial degree of autonomy within a unitary State

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with a Central Government in which both Arabs and Jews would share.
These proposals provided that Jewish immigrants would be admitted over the next two years at the rate of 4,000 a month, and that thereafter the continuance and rate of Jewish immigration should be determined, with due regard to economic absorptive capacity, by the High Commissioner in consultation with his Advisory Council, or, in the event of disagreement, by an arbitration tribunal appointed by the United Nations. This plan, while consistent with the principles of the mandate, added an element which has hitherto been lacking in our administration of Palestine—namely, a practical promise of evolution tending towards independence by building up during a five-year period of trusteeship political institutions rooted in the lives of the people. It was offered as a basis of discussion. These three solutions have already been made known in a broad outline, and we intend to lay before the House later in the week a White Paper describing each of them in greater detail.
The latest proposals of His Majesty's Government were rejected outright by both the Arab Delegations and the representatives of the Jewish Agency, even as a basis for discussion. I think it important that the House should understand clearly the reasons which prompted the two sides to reject this solution. For the Arabs the fundamental point is that Palestine should no longer be denied the independence which has now been attained by every other Arab State and that in accordance with the accepted principles of democracy the elected majority should be free to determine the future destiny of the country. They regard the further expansion of the Jewish national home as jeopardizing the attainment of national independence by the Arabs of Palestine, which all Arab States desire, and they are therefore unwilling to contemplate further Jewish immigration into Palestine. They are equally opposed to the creation of a Jewish State in any part of Palestine.
The Jewish Agency, on the other hand, have made it clear that their fundamental aim is the creation of an
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independent Jewish State in Palestine. With this in view they first proposed that His Majesty's Government should continue to administer the Mandate on a basis which would enable them to continue to expand the Jewish National Home until such time as they had attained by immigration a numerical majority in Palestine and could demand the creation of an independent Jewish State over the country as a whole. When it was made clear that His Majesty's Government were unable to maintain in Palestine a mandatory administration under the protection of which such a policy could be carried out, the representatives of the Jewish Agency indicated that, while still main-taming the justice of their full claim, they would be prepared to consider, as a compromise, proposals for the creation of "a viable Jewish State in an adequate area of Palestine." While they were not themselves willing to propose a plan of partition they were prepared to consider such a proposal if advanced by His Majesty's Government.
His Majesty's Government have thus been faced with an irreconcilable conflict of principles. There are in Palestine about 1,200,000 Arabs and 600,000 Jews. For the Jews, the essential point of principle is the creation of a sovereign Jewish state. For the Arabs, the essential point of principle is to resist to the last the establishment of Jewish sovereignty in any part of Palestine. The discussions of the last month have clearly shown that there is no present prospect of resolving this conflict by any settlement negotiated between the parties. But if the conflict has to be resolved by an arbitrary decision, that is not a decision which His Majesty's Government are empowered, as Mandatory, to take. His Majesty's Government have of themselves no power under the terms of the Mandate to award the country either to the Arabs or to the Jews, or even to partition it between them.
It is in these circumstances that we, have decided that we are unable either to accept the scheme put forward by the Arabs or by the Jews or to impose ourselves a solution of our own. We have, therefore, reached the conclusion that the only course now open to us is to sub-

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mit the problem to the judgment of the United Nations. We intend to place before them an historical account of the way in which His Majesty's Government have discharged their trust in Palestine over the last twenty-five years. We shall explain that the Mandate has proved to be unworkable in practice, and that the obligations undertaken to the two communities in Palestine have been shown to be irreconcilable. We shall describe the various proposals which have been put forward for dealing with the situation—namely, the Arab Plan, Zionist aspirations so far as we have been able to ascertain them, the proposals of the Anglo-American Committee and the various proposals which we ourselves have put forward. We shall then ask the United Nations to consider our Report and to recommend a settlement of the problem. We do not intend ourselves to recommend any particular solution.
Though we shall give immediate notice of our intentions, we see great difficulty in having this matter considered by the United Nations before the next regular Session of the General Assembly in September. We regret that the final settlement should be subject to this further delay, particularly in view of the continuing strain on the British Administration and Services during this further period. We trust, however, that, as the question is now to be referred to the United Nations, all concerned will exercise restraint until their judgment is known.
4.3 p.m.
VISCOUNT CRANBORNE: My Lords, I should like, if I may, to thank the First Lord of the Admiralty for the very full statement which he has made with regard to the position in Palestine. Clearly, this statement is historic. It has disclosed the failure of the Government—I use the word "failure" in no offensive sense—to find, despite their utmost efforts, a basis of agreement acceptable to both the Arabs and the Jews, and their decision to submit the whole problem to the United Nations. Whether this step might have been rendered unnecessary by earlier and more resolute action I do not propose to discuss to-day. But we do recognize, of course, in all quarters of the House, the immense difficulties with which the Government have been faced, and we recognize that,
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very likely, they have no other course open to them at the present time than that which they have taken. At any rate, I do not propose to discuss it to-day, but I would like to give notice to the Government that we shall put down a Motion for debate at an early date.
VISCOUNT SAMUEL: My Lords, in all quarters of the House regret will be felt that the discussions which have taken place should have resulted in failure, though such a result was by no means unexpected. In the present situation there is little doubt that the only course open to the Government is to make a reference to the United Nations, though I am sure that in all quarters of the House the regret of the Government will be shared that so long a delay will be involved before consideration of this question by the United Nations can be undertaken. Meanwhile, we would all wish to abstain to-day from engaging in any discussion, especially in view of the notice which has been given by the noble Viscount, the Leader of the Opposition, to ask for a debate at any early date in your Lordships' House.
LORD STRABOLGI: My Lords, I do not wish to enlarge this discussion in any way but I would like to ask my nobly friend, the First Lord of the Admiralty if I may, two questions which I think are important and practical. There is bound to be—as the noble Viscount has reminded your Lordships—considerable delay before this problem is considered by the United Nations, and in the meantime, there are certain problems of administration in Palestine about which I think the House is entitled to some information, particularly in view of what fell from the lips of my noble friend with regard to the White Paper of 1939. In the interim, which may be very long—it may be a year or more before there is some satisfactory settlement—what is going to happen with regard to immigration? I do not gather that any new figure has been announced. Secondly—and this is quite urgent—are the present restrictions on the purchase of land in Palestine to be maintained in force? I would be very grateful if my noble friend, the First Lord of the Admiralty, can give me some information on those two points.
VISCOUNT HALL: The two matters which have been referred to by my noble

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friend, Lord Strabolgi, are two of many which are now being considered by the Government. I desire to express my thanks to the two noble Viscounts who have spoken very briefly upon the statement which has been made, and I can assure them that a day will be set aside at an early date for a debate in your Lordships' House on this matter.

EXCHANGE CONTROL BILL.
4.8 p.m.
House again in Committee.
LORD PETHICK-LAWRENCE: I think that just before we broke off I was asked by noble Lords opposite if I could extend the declaration which I had made. With regard to the remarks of the noble Viscount, Lord Swinton, I do nor think it is correct that we have the powers to which he has referred, and I am afraid that I cannot go further than I have gone.
LORD RENNELL: I thank the noble Lord for his statement. I had thought of moving an Amendment to omit the clause, but I hoped that the Government would be persuaded to do it.
Clause 30 agreed to.
Clauses 31 to 36 agreed to.
Clause 37 [Other powers of Treasury]:
VISCOUNT SIMON VISCOUNT SIMON moved, after subsection (2), to insert the following subsection:
"(3) Any permission, consent, authority or direction granted or given by or under the authority of the Treasury under this Act (except in cases where such permission, consent, authority or direction is granted or given in respect of an individual) shall be published in the prescribed manner for the purpose of ensuring that it shall be adequately known by the persons concerned, and a failure to observe any such direction shall not be made the subject of a prosecution unless such failure arises after such publication as aforesaid."
The noble and learned Viscount said: Consideration of the Bill by the Committee has necessarily been interrupted in order that a very important statement might be made. I hope that I may now be allowed to submit to the House that the question raised in this Amendment put forward by Lord Balfour of Inchyre and myself is really a very important one. The
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question is whether or not we are going to provide in this Statute, in so far as the Treasury make general permissions, or give general authorities or directions, that what the Treasury thus decide is made public. I will not say any more in criticism of the form of the Bill, because it is really common ground between the noble Lord, Lord Pethick-Lawrence, and the rest of us that this Bill does take an exceptional form (which is said to be necessary) in that it lays down enormously wide prohibitions for breaches of which, on the face of it, everybody may 133 prosecuted and, in some cases at any rate, may go to prison.
Those prohibitions, as I say, are enormously wide, but none the less, as the noble Lord rightly points out, it is hoped to make the actual effect of the Bill much less widespread, because it is the firm intention of the Treasury to issue general orders of exemption. That is all very well. Whether the right way is to prohibit all sorts of things and then excuse a large part of them is another matter. Already in the Committee stage to-day my noble friend Lord Moyne has been assured that the appeal which he made about people who come from Eire and who want to send postal orders and pound notes to their relatives in Eire, which under the terms of the Bill is a criminal offence, will be met, and that it will be met by a general Order such as the Treasury may make under the Bill. There are many other cases in the Bill where similar provisions are to be made. Of course, I do not suggest that the permission by way of exception given by the Treasury to an individual, such as a man who wants to travel abroad and asks if he can take with him a limited amount of sterling, should be published. It is a limited thing, and, indeed, I think the paper shortage would make it practically impossible to have it published.
But when you come to decisions by the Treasury—whether permitting things or prohibiting things under the terms of this Bill—which refer to a class, I do submit to the good sense and fair judgment of this House that these kings ought to be published. They ought to be published because, of course, everybody else in like case is entitled to know if the Treasury in their judgment think that a particular class of case should be exempted and the rigour of the Bill should not apply to it. It is no good their deciding or making an

723
Order unless it is published. I speak subject to correction, and I am sure the noble and learned Viscount the Lord Chancellor will correct me with his usual courtesy if I am wrong. But, so far as I have been able to see, there is nothing in this Bill, as it is now before us, which provides for publication. Therefore, it is quite possible, and indeed it will be the case, that permission of a general character will be given in various directions.
All I am saying in this Amendment is that there ought to be publication in some proper form of these general powers. I believe that the proposition is one that can hardly be resisted. I am sure it must receive the sympathy of everyone in this House, quite apart from Party, because obviously, if it can be done, it will be the fair thing to do. With that in mind, may I be allowed just to read the Amendment to the House, because not everyone has the Marshalled List in front of him? I am not saying that this is necessarily the best way to draft it, but I think it does express the idea. This is what I seek to add to Clause 37 in the Bill:
"(3) Any permission, consent, authority or direction granted or given by or under the authority of the Treasury under this Act (except in cases where such permission, consent, authority or direction is granted or given in respect of an individual) shall be published in the prescribed manner for the purpose of ensuring that it shall be adequately known by the persons concerned, and a failure to observe any such direction shall not be made the subject of a prosecution unless such failure arises after such publication as aforesaid."
I hope I shall not be met with either of two possible responses. In the first place, I hope I shall not be asked to consider whether the words are exactly right—I am sure I shall not be, with the Lord Chancellor sitting there. I am most willing to believe that those who are responsible for this Bill, and the noble and learned Viscount in particular, will see that it is put in the best possible words. I have done the best I could, and I hope, at any rate, that it is plain English, which is more than could be said of everything in Acts of Parliament. The second answer which I hope will not be offered is: "Oh, I can assure you that is what we always mean to do." The question is not whether the Treasury are going benevolently beyond what they are obliged to do; the question is whether it ought not to be put in the Bill. All sorts of things are prohibited under penalty in
724
this Bill, subject to the class of cases in which the Treasury give permission. It is only common sense and reason that you should publish an explanation of Orders which the Treasury make in mitigation under the Bill.
Publication is necessary, first of all, in order that there may be fair play for everybody. If there is such a general permission given, and some people do not happen to know of it, then they may abstain from taking any action which they would be allowed to take because the Bill makes it a criminal offence to do it. It is also necessary because it is quite wrong to leave people to break the law on the chance that it will be forgiven or forgotten. I will take the case of these Irish employees over here which was mentioned by me on the Second Reading, and mentioned much more fully and persuasively by my noble friend behind me to-day. It is all very well to say: "You may take it the Treasury will not make any bones about these girls in restaurants in London sending money home to Eire by postal order." The fact remains that if I say that to one of these girls and she sends a postal order home she will, as things stand, be breaking the law—the criminal law—unless she gets permission. On the earlier Amendment I noticed my noble friend Lord Pethick-Lawrence met the objection of Lord Moyne by saying: "Oh, the Treasury will make an Order about that." I am very glad to hear it. But are they going to publish the Order? I suggest it is only right that these things should be published, and I am encouraged to think that this will be received with some friendly consideration because, in answer to an earlier Amendment, my noble friend opposite, the Secretary of State, thought the Treasury had already been collecting a whole bundle of drafts which were going to be issued at the same time as the Bill.
Making an Order is one thing, but making it known to the public is another. I want to secure the provision in the Bill which I have here endeavoured to state. It seems to me manifestly wrong that anybody should be punished because he has not obeyed a Treasury direction, which is one of the features of this Bill, though he has had no opportunity of knowing what the direction is. There have been cases under the Food Regulations—and I speak subject to correction—where people have been prosecuted for breaches

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of Regulations although they did not know the Regulations existed. I am not asking for more now than that the noble Lord. Who is good enough to reply will give this House a firm assurance that the Government will put into this Bill the provisions which cover the ground I have indicated. I hope very much that they will do so. I feel sure it is the general feeling of noble Lords here that it ought to be in the Bill, and I hope very much we shall be able to see it put there by general consent.
Amendment moved—
Page 25, line 35, at end insert the said subsection.—(Viscount Simon.)
VISCOUNT MAUGHAM: In the absence of other lawyers to speak to this Amendment I think it is desirable I should say just one word. Clause 37 of the Bill, subsection (3), obviously suggests that by virtue of a direction given by the Treasury under the Act no person may be convicted of an offence against the Act unless the direction was served on him or he knew, or avoided getting to know, of the giving thereof. There is a proviso about reasonable steps being taken for the purpose of bringing the purport of that direction to his notice. If these steps were taken, "it shall be for him to show that he neither knew nor avoided getting to know of the giving thereof"; that is to say, the onus is shifted in that case, and he has to prove that he did not know or (what would be a very funny conception) avoided getting to know. If it were a direction which was published anywhere there would presumably be no difficulty in his knowing without any such clause as this.
It seems to me that under a Bill of this sort relating to exchange control, no person ought to be prosecuted, or be subjected to the stigma of prosecution and possibly disagreeable consequences of a judgment against him, whether rightly or wrongly, unless he is aware, in the ordinary course of his business, that something is prohibited and that he does it at his peril. In such a measure as this, it seems to me that precisely the same principles apply as apply in the case of a taxing Statute—namely, that the offence should be made clear and that the facts upon which a prosecution may be launched should be obvious to any citizens of the realm.
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It is new to me in a Statute of this character that there should be an obligation the breach of which involves a criminal act unless there is a full publication to all the people who might be affected by it and unless the man therefore knows precisely what risks he is running. I would observe for my part, without in any way limiting what other people may think about it, that the strength of the case against this clause as it stands is that it applies to any directions given by the Treasury under the provisions of this Bill, whether the directions are reasonable or unreasonable. In either case it applies.
VISCOUNT SLAION: And to any permission.
VISCOUNT MAUGHAM: And to any permission. Secondly, it applies however general the direction may be. So that anybody who is in any way concerned with any such transaction as is dealt with in the Bill may find himself subject to prosecution under subsection (3) of Clause 37. I cannot help thinking that the matter should be clarified a little more, so that what I would regard as a legal mistake should not be perpetrated and possible injustice done in the future under the provisions of this Bill.
THE LORD CHANCELLOR: I am not quite certain that I understand the real point of this Amendment. I can only judge the Amendment by the words it uses. I quite realize that drafting errors may be put right hereafter. I want to try to follow the substance of the thing. The Amendment, as I follow it, falls into two parts. First, it is saying that any permission, consent, authority or direction (except in cases where such permission, consent, authority or direction is given in respect of an individual) must be published in the prescribed manner. "Prescribed," as the noble Viscount has pointed out, is defined in the Bill as meaning "prescribed, for the purposes of the provision in question, by order of the Treasury." That is all it means.
The Amendment goes on to deal with a criminal offence, and says that no one is to be found guilty of a criminal offence, which arises under a direction rather than under an exemption, unless the particular direction has been brought to his attention. It seems to me that in drafting that, the noble Viscount failed to

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notice subsection (3), because that was designed to deal with that point. We make it quite plain in subsection (3) that, so long as the direction is not published under the Rules Publication Act or the Statutory Instruments Act, when that takes its place—we had a discussion on the Statutory Instruments Act—the public are not presumed to have notice of these matters. If it is there then the man may be convicted, but if it is not there, he cannot be convicted "unless the direction was served on him or he knew, or avoided getting to know, of the giving thereof." That sometimes happens. It has to be proved that the man deliberately avoided getting to know, as, for instance, by deliberately abstaining from opening any letters that he thought might come from the Bank or the Treasury. But that has to be proved.
The subsection goes on to state:
"Provided that where reasonable steps are taken for the purpose of bringing the purport of the direction to his notice it shall be for him to show that he neither knew nor avoided getting to know of the giving thereof."
That is our code and that is what we have set out to do. May I say one further word, so far as exemptions are concerned. I think the noble and learned Viscount had in mind particularly the case of the Irish serving maid over here who wants to remit money.
VISCOUNT SIMON: There are many more.
THE LORD CHANCELLOR: That was the one illustration given, but any other illustration you like to give will do. So far as exemptions are concerned, those have to be published by Order, and those Orders have to be laid, and all the exemptions that will be made will be made by Order laid before Parliament—every one of them. I am dealing, of course, not with a merely specific individual one. Your Lordships will see at the top of page 25 the words:
"Any Order made by the Treasury under this Act … shall be laid before both Houses of Parliament."
All the exemptions come under that. Moreover, the exemption will be not only published but laid. So far as permissions are concerned they are rather different, because in practice permissions are worked through the banks. When you
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give a permission—which is some concession from a airection—you notify the banks, and the banks, of course, notify their clients. But so far as directions are concerned there is really nothing of importance, as I see it, between the phrase in line 33:
"shall be given to such persons in such manner as the Treasury think appropriate,"
and the phrase:
"shall be given in the prescribed manner"
which means "as the Treasury may order." They both come to precisely the same thing.
VISCOUNT SIMON: Really I have not made myself plain. I know that the noble and learned Viscount, the Lord Chancellor, would not deliberately wish to remain under a misapprehension. I will take an instance, which is a common instance in the Bill. There are many clauses which say that something or other is prohibited except with the permission of the Treasury. I have not yet followed, with great respect to the noble and learned Viscount, what clause in the Bill provides that where that permission is of a general character it must be published. That was the point I was dealing with. I am quite willing to take the case of the Irish girl. Where is there anything in the Bill which says that because the Treasury is minded to excuse a class of people from sending postal orders abroad, and gives permission to that class of people, the permission shall be made known? With great respect I have not seen that. I am sorry if I introduced a complication by referring to directions; that is my fault. I still want to know the really important thing: how are people who ought to benefit by these permissions to know that the permissions are given? That is not laid on the Table of the House, surely.
THE LORD CHANCELLOR: What has been the practice—and what I understand it is intended is to be the practice—is that the permissions are either given through the bank or are given by an Order which has to be laid.
I think—if the noble and learned Viscount will forgive my saying so—he has rather a habit of not listening to the answer, having made, as he always does, a very formidable case. One must not merely make a formidable case; one must be a good listener afterwards. What I was going on to say was this: I am quite ready to consider whether or not I am right on

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this matter. I realize that one should consider carefully whether exemptions should be given so that all the world should know about it.
VISCOUNT SIMON: Permissions.
THE LORD CHANCELLOR: Yes, permissions. The words are "permissions, consent or authority", if we are to be quite accurate, but I do not want to recite those words each time. I am quite willing to look into it between now and the Report stage, if Report stage there be, or Third Reading if there is no Report stage. When my noble friend said that he would look into the matter before the Report stage, that means, of course, before Third Reading, if there is no Report stage. I am willing to consider that. However, the broad general principle which we desire to maintain here is that which we have laid down in subsection (3), which makes at any rate the last part of this Amendment completely otiose; that is to say, we make it quite plain that there can be no prosecution here unless' you bring home to the man against whom you are making a charge that he knew, or in substance deliberately abstained from knowing, what the direction was in respect of which he is being prosecuted. That we must adhere to, and I cannot get away from it. But for the rest, on the question as to the way in which the notice should be given, that I am quite willing to look at with my advisers, to see that, so far as possible, we make known to the world the various provisions which in this connexion are material.
LORD BALFOUR OF INCHRYE: I do not wish to detain your Lordships for more than a few moments. I am grateful to the noble and learned Viscount, the Lord Chancellor, for saying that he will look into the matter. May I remind the noble and learned Viscount, that on December 5—column 545 of Hansard—the Financial Secretary, who dealt with the question of permissions granted under Clause 22, subsection (1), of this Bill, said:
"I was asked whether a list of the prohibited articles would be published. Of course, it will be."
But then if you search Hansard afterwards there has been no explanation as to how that publication would take place.
THE LORD CHANCELLOR: If I may interrupt the noble Lord, that will
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take place by an Order laid before Parliament.
LORD BALFOUR OF INCHRYE: Yes. Now we come to permissions. One thing I am puzzled about is this: when does an exemption become a permission? Suppose the Treasury wish to give permission for postal orders for 7s. 6d. instead of 5s. to be sent to the Irish Free State, that would be a permission amending an exemption already made. It is that particular point we want clarified.
THE LORD CHANCELLOR: General or specific?
LORD BALFOUR OF INCHRYE: general permissions. If we are satisfied that general permissions will be know a to all people, as well as the exemptions which are covered by the Treasury Order, then, either by some Amendment which the Lord Chancellor may consider necessary, or by his reassurance, I think the point will be met.
VISCOUNT SIMON: I would like to thank the noble and learned Viscount for all his observations, and I would say that I am very willing to await the result of his further examination. I merely submit to him, with great respect, that when that examination takes place it may turn out that in many places where the treasury may give permission there is no provision in the Bill for the fact that they have given that permission, and for the extent, though it is general, to which it shall be published. After looking at it maturely, if the noble and learned Viscount finds that I am wrong, I shall be willing to accept his correction. But at present, with all possible courtesy, I am afraid that I am quite right.
Amendment, by leave, withdrawn.
Clause 37 agreed to.
Clauses 38 to 40 agreed to.
Clause 41:
Determination of residence.
(2) The Treasury may give directions declaring that for all or any of the purposes of this Act a person is to be treated as resident or not resident in such territories as may be specified in the directions.
4.35 p.m.
VISCOUNT SIMONhad the following Amendment on the Paper: To insert, after subsection (2), the following subsections:

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"(3) If any person is dissatisfied with the directions given by the Treasury in regard to him under the last foregoing subsection, he may appeal to a Judge of the High Court nominated by the Lord Chancellor for the purpose, in order to obtain as rapidly as possible a decision on the issues raised in accordance with Rules of Court, and the decision of the Judge shall be final. Provided that in any case where it is necessary for directions to be given the decisions of the Judge can be obtained, such directions shall be operative until the decision of the Judge is obtained.
(4) The jurisdiction conferred by the last foregoing subsection upon a Judge of the High Court shall extend to the giving of a decision on the question whether a person is to be treated as resident or not resident in any territory upon an application made for the purpose at any time before a direction is given, and such application may be made either by the Treasury or by the person in respect of whom the direction is proposed to be given."
The noble and learned Viscount said: This is the only other Amendment which I wish to ask the House to consider, but I do think the matter is an important one. I am not without hope that the object which I have in view is one that the noble and learned Viscount, the Lord Chancellor, may feel to be deserving of a certain measure of sympathy. As things stand, the decision as to whether or not a person is or is not a resident rests finally and altogether with the Treasury. There are some purposes in this Bill for which it is important for a man to be held to be a resident. There are other purposes in the Bill for which I think it would suit him better not to be held a resident. At any rate, as things stand and as this clause says quite plainly, it is the decision of the Treasury which is to determine whether a person is resident or not, and whether a company is resident or not.
I hope the noble and learned Viscount will agree with me that it is' not a good thing that we should leave the decision on a question which is not a simple question to be determined by the Treasury. The only objection which could reasonably be taken to my Amendment would be that, however desirable it is in principle, it cannot be done. I am sure that nobody desires that the question should be carried from court to court or that it should be dealt with in the House of Lords. But there have been instances before in which difficult questions like this have arisen, in which the Act of Parliament has not said that it is to be finally decided by the Department concerned. On the contrary,
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the Act of Parliament has provided that on such a question the matter should be finally decided by a Judge of the High Court under the Rules of Court. That is what I desire to suggest here. It is not right, I venture to think, that the Treasury, which in one sense is one of the two parties—though no doubt they are acting in the public interest to the best of their ability—should be the final authority to decide who is a resident and who is not.
The main objection which I anticipate might be raised is that in some cases this matter has to be decided so speedily that it is difficult to see that there is room for any form of appeal. I have tried to deal with it in my suggested Amendment. It would perhaps make it plainer to my noble friends opposite if I explained it, as it is not correctly printed. What I want to insert is this:
"If any person is dissatisfied with the directions given by the Treasury in regard to him under the last foregoing subsection"—
that is to say, the directions declaring that he is a resident or he is not—
"he may appeal to a Judge of the High Court nominated by the Lord Chancellor for the purpose, in order to obtain as rapidly as possible a decision on the issues raised in accordance with Rules of Court,"—
No doubt Rules of Court would have to be made as to whether the application should be in Chambers or in open court—
"and the decision of the Judge shall be final."
There shall be no question of going to the Court of Appeal—
"Provided that in any case where it is necessary for directions to be given"—
by the Treasury—
"before the decisions of the Judge can be obtained, such directions shall be operative until the decision of the Judge is obtained."
The words as printed are a pure slip. My Amendment should read as I have just given it to your Lordships. A man may say: "I want, as speedily as possible, to get you to declare that I am a resident, although I have not been here long, so that I may be entitled to do those things which only residents may do under this Bill." The Treasury may say, "We do not agree that you are a resident." As the matter stands, the Treasury, and nobody else, have to decide that. I recognize that there may be cases where the applicant comes too late, and where the matter is so urgent that the question has really to be decided there and then. Be

733
that so. But I suggest that provision should be made for the Judge to decide the matter as soon as possible, and if he comes to a different conclusion, the man may, in many cases, receive better treatment.
There is the further point that he may raise the question with the Treasury months before. He may say: "I am hoping to go on a business trip to South America in the autumn. I am making my provisional arrangements now, and I wish to take a certain amount of money with me. I want to know whether or not I am a resident." It is possible that there might be considerable correspondence before the matter is finally determined, and in the meantime he will be waiting for a decision, as he hopes, in his favour. Therefore I want to put in:
"The jurisdiction conferred by the last foregoing subsection upon a Judge of the High Court shall extend to the giving of a decision on the question whether a person is to be treated a resident or not resident in any territory upon an application made for the purpose at any time before a direction is given, and such application may be made either by the Treasury or by the person in respect of whom the direction is proposed to be given."
Your Lordships see, as I am sure my noble friend opposite sees at once, what I have in mind. What I have in mind is that it is really not right, if it can be avoided, that a decision of this sort, on which much may turn so far as the individual is concerned, should be finally decided by a Government Department. I hope there is no one who thinks that that is the proper way in which to do it. The question is whether we can make arrangements which will mitigate that, and I think that we can if we adopt the procedure which was, I think, adopted under the Unemployment Insurance Act, where I recollect that Mr. Justice Roche used to sit especially to decide who came within the Act and who did not. If we can devise a machinery like that without destroying the machinery for reaching speedy decisions, we shall be doing a useful thing. I venture to put that suggestion before the noble and learned Viscount, the Lord Chancellor. I hope very much he may, in the first place, feel that it is put forward with the intention of achieving an object with which he sympathizes, and that in the second place, he and those who advise him, may be able to see that it can be done. I beg to move.
Amendment moved—
Page 27, line 21, at end insert:
("(3) If any person is dissatisfied with the directions given by the Treasury in regard to him under the last foregoing subsection, he may appeal to a Judge of the High Court nominated by the Lord Chancellor for the purpose, in order to obtain as rapidly as possible a decision on the issues raised in accordance with Rules of Court, and the decision of the Judge shall be final. Provided that in any case where it is necessary for directions to be given before the decisions of the Judge can be obtained, such directions shall be operative until the decision of the Judge is obtained.
(4) The jurisdiction conferred by the last foregoing subsection upon a Judge of the High Court shall extend to the giving of a decision on the question whether a person is to be treated as resident or not resident in any territory upon an application made for the purpose at any time before a direction is given, and such application may be made either by the Treasury or by the person in respect of whom the direction is proposed to be given.")—(Viscount Simon.)
THE LORD CHANCELLOR: I fully appreciate the reasons which the noble and learned Viscount has in mind in moving this Amendment and I quite see the point of it. I am sorry, however, to tell him that it is one which we cannot possibly accept. We regard this as going to the root of exchange control. As he rightly says, rapidity of decision is necessary. That is true; and he tries to provide for it by his Amendment. But there is another quality which is wanted almost as much, and that is flexibility. One of the great features of our law is that it is a system whereby the law is declared, and the law so declared applies to all similar cases. If it is declared in the highest court which can speak on the matter, then only an Act of Parliament can alter it. I think it is right that that should be so, and I, for one, rejoice in the fact that it is so.
Here we are in, as I have said before, a line of country which I very much regret, as I regret this Bill. Here we are dealing with something in the nature of siege economics. I believe it would be absolutely disastrous for us if we followed the precedent of the ordinary Income Tax Acts, where there is a decision as to the law from a Judge and where, if the Judge by his judgment shows there is some loophole in an Act, evasions take place until the matter is put right in the next Finance Act. As I see it, it is idle to think that the circumstances in which we find ourselves to-day are such that we can contemplate any such procedure at all.

735
leak may start by being a small leak, but a leak which starts by being small has a habit of becoming larger and developing into a rush. We really cannot face that element of rigidity (for which, in normal circumstances, there is so much to be said) which comes from having a Judge's decision, following precedent and all that sort of thing. That is not possible to-day.
Let me show your Lordships how flexible this system is to-day, and how this procedure has worked for seven years now with, I believe, almost universal consent. This applies not only to individuals but to companies and so on. We sometimes have a person who is at one and the same time treated as a resident and as a non-resident. Take, for instance, one of the Dominions with an insurance company over here. They carry on a business over here of collecting premiums in respect of risks which they write here, and of paying out sums in respect of the losses which they incur here. That is a resident business. Then they make a profit, and that profit they transfer to another account, which is a non-resident account. That is quite common.
The whole of the smooth working of this scheme is entirely due to the way in which the banks work it and in which the Bank of England supervise the work. An account is established with a bank, and if the banker is in any doubt at all as to that account he asks whether it is to be treated as a resident account or a non-resident account, and he gets his instructions. If it is an obvious case he decides for himself, but if he is in doubt about it he asks the Bank of England and they say: "Treat it as a resident account" or "Treat it as a non-resident account," as the case may be. Thereafter the account remains what it has been so designated, save with the consent of the Bank of England. Really we deal with these matters by—the word perhaps is hardly appropriate—looking at the account itself, rather than at the individual and by having in some cases a resident account and in other cases a non-resident account—two of them available for the same person.
In the seven years during which this thing has worked, so far as I know there has been only one case in which there has been any sort of complaint. There was one case where somebody treated as
736
a non-resident said he ought to be treated as French, and that therefore the account should be in francs, rather than as an American, in which case it would be dollars. That is the only case in seven years in which there has been any trouble. Here we are following our experience, the experience of our friends in the sterling area and the experience in Canada. All of them have a provision similar to that which we have in this Bill. I am firmly convinced that if we are really going to get working with the necessary flexibility a system of exchange control which unhappily we certainly need, having regard to the strains and stresses to which sterling is going to be put, we can only get it if we accept this system here, which has worked so well, and eschew—though I dislike eschewing—the appeal to the courts, which, inevitably, is less flexible and more rigid, and which would expose us to all the troubles we had in the past.
Therefore, I must tell the noble and learned Viscount that although I fully appreciate his motive in bringing this Amendment forward, and though I sincerely wish that the times were sufficiently spacious and not sufficiently critical to enable us to accept an Amendment which, in normal circumstances, I should most certainly welcome, yet, having regard to our experience, the experience of our neighbours in the sterling area, and the experience of Canada, we cannot possibly accept this system which will destroy our flexibility and give us great rigidity. It is no good my saying I will consider this any more, because I have considered it and discussed it with the Treasury experts, and on this matter the Treasury say they must stand perfectly firm.
VISCOUNT MAUGHAM: Before the matter closes, may I ask the noble and learned Viscount whether it would not be possible to add only two words to show what is meant by "residence" in this connexion? I daresay it is not easy, of course, because "residence" does not merely mean, I suppose, residence at a hotel for a week. Something other than that is designated, and it is a matter of very great importance. I am acquainted with people who come here from time to time and who are not residents in this country. Unless words are added to make that clear I am afraid there will be great uncertainty, and even some uncer-

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tainty in the minds of the Treasury in deciding whether a man is or is not resident in this country.
THE LORD CHANCELLOR: I am afraid that that difficulty is inherent. These things turn on such fine points, and depend from the Treasury point of view very much upon whether there is any "monkey business"—as they call it—going on. I am afraid I could not possibly devise words which would make that which is very difficult appear any clearer.
VISCOUNT SIMON: I am obliged to the noble and learned Viscount for dealing so courteously with what I said. I confess to sharing the distress which he has expressed that this should be thought to be necessary. Time was when it used to be said that equity was the length of the Lord Chancellor's foot. I think that probably none of us would wish to assert that now, but I can assert what residence is: residence is the length of the Treasury's foot. It just depends as to weather, in a particular instance, they think the case is one which they can deal with benevolently, or whether they should take the stricter view. I am sorry to think that it had not occurred to me that it was going to be decided on the lines of the Income Tax cases as to residence. If that is so, I am heartily sorry for the clerk in the Treasury or in the Bank of England who is to issue decisions on these matters. I thought it was simpler than that. Not only the basis on which we decide residence, but the tribunal which deals with the matter, will be left entirely to a Government Department. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 41 agreed to.
Remaining Clauses and Schedules agreed to.
House adjourned during pleasure.
House resumed.

ROYAL COMMISSION.
The following Bills, and Measure passed in accordance with the provisions of Section 4 of the Church of England Assembly (Powers) Act, 1919, received the Royal Assent—
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Greenwich Hospital

Trustee Savings Banks.

Pensions (Increase).

Road Traffic (Driving Licensces).

Malta (Reconstruction).

House of commons (Redistribution of Seats).

Incumbents (Discipline) Measure.

House adjourned during pleasure.

COMPANIES BILL. [H.L.]
5.17 p.m.
House again in Committee (according to Order).
Clause 14:
Signature and copies of accounts.
(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 COZENS-HARDY LORD COZENS-HARDY moved, at the end of the clause, to add:
"Provided that the provisions of paragraph (b) of subsection (2) and of subsections (3) and (5) of this section shall not during the year in question apply to a private company if the following conditions have been complied with:—

(a) the company has not less than two months prior to its annual general meeting passed a special resolution desiring such exemption and has sect to the Board of Trade a copy of such resolution;

739

(b) that a certificate of exemption in accordance with the provisions of the next following paragraph of this subsection has been given to the company by the Board of Trade and that a copy thereof has been sent by the company to the Registrar of Companies;

(c) that, in the notice calling the meeting to consider such special resolution there has appeared with reasonable prominence a statement that any member objecting thereto may notify the Board of Trade of his objection.

In considering such applications for exemption the Board of Trade having made such inquiries as it deems necessary shall within 28 days of the notification of such special resolution inform the company of its grant or refusal of such exemption for the year in question. In making its decision the Board of Trade shall have regard to the circumstances of the case and to the public interest."
The noble Lord said: I would remark, in passing, that though the Amendment relates to subsection (5) there is no subsection (4). I sincerely hope that the noble and learned Viscount, the Lord Chancellor, will not be so hardheaded with regard to this Amendment.
SEVERAL NOBLE LORDS: Hardhearted you mean!
LORD COZENS-HARDY: I hope that the noble and learned Viscount the Lord Chancellor will recognize that this Amendment is drawn to safeguard minority interests, and I trust that he will not feel compelled to refuse it as he has refused earlier Amendments of mine. My aim is simply to preserve a degree of privacy which is allowed to a private company which complies with the stringent conditions of Clause 43. Even in a company limited to fifty shareholders, there are sure to be some members who, by nature, are careless, and who may unintentionally leave copies of the companies' accounts lying about, and so destroy the privacy of the company's affairs. To guard against accidental discovery, the members may prefer not to have private accounts floating about in their hands for twenty-one days before the annual general meeting. My Amendment simply makes provision for putting this relief into effect if, and only if, the Board of Trade certifies that such a waiver is reasonable in the circumstances and not against public interests. I beg to move.
Amendment moved—
Page 14, line 36, at end insert the said new words—(Lord Cozens-Hardy.)
LORD CHORLEY: I am sorry to have to inform the noble Lord, on behalf of my noble and learned friend, that I propose to be hard-headed and hard-hearted about this Amendment. The noble Lord's Amendment would, as he has indicated, relieve a private company from the requirement of attaching a profit and loss account to its balance sheet, and of circulating to its members copies of the balance sheet, profit and loss account and consolidated accounts, and the other obligations which are imposed upon companies under the clause as it now stands. Under the existing law, the situation is very unsatisfactory. No member of a private company is entitled as a right to have the balance sheet circulated to him; he has to pay for it, and he has no right to the profit and loss account at all.
The Cohen Committee considered this matter very carefully, and they recommended that shareholders in private companies should be entitled to these documents in the same way as they are in public companies. No doubt there is something to be said for the noble Lord's argument of the unfortunate private company having the state of its accounts made known to some of its competitors, but a competitor who is really determined and unscrupulous is prepared to use any means to get these accounts. We know that he does, in fact, get them and we do not think that that argument can stand up to the importance of members having the accounts. We are therefore unable to accept this Amendment.
LORD COZENS-HARDY: The Amendment does not keep away from the shareholders of an exempt private company the information which is required. That is to say, they will have before them at the general meeting the balance sheet and the profit and loss account. The only object of the Amendment is to provide that a company which does not wish to have these things delivered twenty-one days before need not have them.
LORD CHORLEY: The position is really similar to the one we discussed last week. It would enable the majority which controls a private company to do this by means of a special resolution.
LORD COZENS-HARDY: Only subject to the consent of the Board of Trade.
LORD CHORLEY: Subject to the consent of the Board of Trade, which is a

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very cumbersome and elaborate piece of machinery. I am afraid that in the circumstances we are unable to accept this Amendment.
LORD COZENS-HARDY: I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 14 agreed to.
Clause 15 agreed to.
Clause 16:
Extension of disqualifications for appointment as auditor.
16.—(1) A person shall not be qualified for appointment as auditor of a company unless either—

(a) he is a member of a body of accountants established in Great Britain and for the time being recognized for the purposes of this provision by the Board of Trade; or

(b) he is for the time being authorized by the Board of Trade to be so appointed either as having similar qualifications obtained outside Great Britain or as having before the eighteenth day of July, nineteen hundred and forty-five, practised in Great Britain as an accountant.

(2) In subsection (1) of section one hundred and thirty-three of the principal Act (which disqualifies, among others, directors and officers of a company and partners and employees of officers of a company from appointment as auditors of the company)—

(a) references to an officer of the company shall include any servant of the company, but not an auditor; and

(b) paragraph (b) (which relates to partners and employees of officers of the company) shall apply in like manner to partners and employees of directors of the company; and

(c) the exception in the said paragraph (b) for private companies shall cease to have effect.

5.25 p.m.
LORD DE L'ISLE AND DUDLEY LORD DE L'ISLE AND DUDLEY moved, in subsection (1) (b), to leave out "before the eighteenth day of July, nineteen hundred and forty-five." The noble Lord said: I rise to move the Amendment that stands in my name. The object of the Amendment is to delete the words "before the 18th July, 1945." It seems to me that this is an arbitrary date to fix for disqualifying accountants who are not members of the learned bodies. If a man had been serving in the Forces or in affairs of State during the war, he might, on return, find that his livelihood and his profession had departed from him. In order to do justice to such people
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I think it right that this arbitrary date should be taken from the Bill.
Amendment moved—
Page 15, line 40, leave out from "having" to "practised" in line 42.—(Lord De L'Isle and Dudley.)
LORD SALTOUN: I would like to support my noble friend's Amendment. The accountants' societies of Scotland would like to insert here "for a period of five years." In view of the very varied qualifications of a large number of people who practise as accountants, and in view of the very privileged position occupied by auditors under the existing law which is going to be very much increased under this law, I cannot but think that that would be a reasonable stipulation to make, especially when one considers the condition of affairs in small country towns. I take the opportunity at this point, in supporting my noble friend's Amendment, to ask the Government if they will consider this matter at a later stage. It is a point to which my attention was drawn only yesterday, so I could not give proper notice.
LORD LATHAM: I wish to invite your Lordships to reject this Amendment. I speak as a member of one of the recognized associations of accountants, and I have practised as a professional accountant for some thirty years. I wish to submit to your Lordships that, whilst it is eminently desirable and will be accepted by every member of your Lordships' House that special provision should be made so that no substantial injustice is done to ex-Service persons, this is not the way to do it. The Amendment is against the whole weight of evidence submitted to the Cohen Committee, and is in conflict with the recommendations of that Committee. The Amendment, if accepted, would mean that any person at any time could say that, because he had done the audit of a greengrocer at the end of the road, he had a claim to be considered by the Board of Trade as to whether he was not, in fact, in practice as an accountant. I do submit that that very largely vitiates the quite proper provision contained in this Bill, following the recommendations of the Cohen Committee, to tighten up the law both as regards accounts and as regards the qualifications of those who purport to audit accounts, and also to tighten up the requirements of the existing law both as

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regards public companies and as regards private companies.
Therefore, I invite your Lordships not to accept this Amendment, and I would, with respect, ask the noble and learned Viscount, the Lord Chancellor, to consider whether the clause as it now stands should not be looked at between now and Report stage or the Third Reading, with a view to seeing whether some proper provision could not be made in order not to inflict injustice upon ex-Service people. That is the view of the established and recognized bodies of practising accountants who have, for some time, been associated together in joint consultation as a joint committee with a view to securing the regularization by registration of the accountancy profession, which I think all business people will admit is overdue and is eminently desirable. The proposals which will be ultimately submitted, with, it is to be hoped, the sympathy and support of the present Government, will provide for the registration of qualified and recognized accountants and will provide, as I think reasonably, for the admission to practice of such accountants who may not be members of the recognized bodies but who can show that they have been in practice for a specified time before a specified date.
The effect of the Amendment before your Lordships' House would be to take out the specified date. It is not an arbitrary date in the generally accepted sense: it is related to something. It is related to the date of the publication of the Cohen Report, when it was assumed that the public could be regarded as having been put on notice as to what were the recommendations of that Committee which were to be followed by legislation. Therefore I hope that this Amendment will not be accepted, but that the noble and learned Viscount the Lord Chancellor will see his way clear to consider some protective words to safeguard the position of ex-Service men.
LORD RENNELL: I am inclined to support the Amendment. While not disagreeing with what was said by the noble Lord who has just sat down, I should like to draw your Lordships' attention to the practical rather than the theoretical issue on this point. As a matter of fact, there are two points involved in the Amend-
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ment of the noble Lord, Lord De L'Isle and Dudley. One is that which relates to the exclusion, or the hardship which may be caused by the exclusion, of persons who had been practising as accountants, though not belonging to any of the recognized associations, and who have been demobilized from the Forces. They would be precluded by the operation of this date from resuming or accepting work of this nature. But the Amendment really has a much wider implication, and it is on the purely practical issue that I should like to support it.
The practical issue, as it seems to me, is this. There are in England and Scotland something of the order of 162,000 private companies. A great many of them are very small corporations. They will be familiar to many of your Lordships in any town or maybe village in England. In many cases in practice these small companies have had their accounts audited by persons who are not qualified and who do not belong to any recognized association of auditors or chartered accountants. There is not to-day in this country a sufficient supply of qualified auditors belonging to the associations to undertake the work of auditing the accounts of the 162,000 companies which at present need auditors. From the purely practical aspect, I ask your Lordships to support the Amendment, and I beg the noble and learned Viscount the Lord Chancellor to take it into serious account. Otherwise not only will very grievous hardships be caused to the people who have been practising as auditors (and quite adequately) in auditing the accounts of these small companies to which I have referred, but it will be made practically impossible for many companies to get their accounts audited, because there are not enough auditors to do the work. Your Lordships know as well as I do the delays which are inevitable at the present moment (I refer of course to those of us who may use auditors for the purpose) in getting income tax returns and accounts made up. Very often two of three years' arrears of work have to be done. A situation which would make it impossible for those people who have adequately performed these services in the past to continue to do so in future would be not only an injustice to the persons concerned but a grave hardship to the companies for which they have been working.
VISCOUNT ELIBANK: The noble Lord who has just sat down has made out a very strong case in favour of the Amendment, and I agree with all he has said. Nevertheless, the noble Lord opposite also made a strong case from the point of view of the protection of the public. I think that this clause with the words moved to be omitted by my noble friend, Lord De L'Isle and Dudley, certainly does not protect the public in the way that it should. I believe that if the noble and learned Viscount, the Lord Chancellor, in dealing with this matter, would consider omitting those words and at the same time adding at the end the words, "for a period of not less than five years"—that is to say, having practised in Great Britain as an accountant for a period of not less than five years—that, at least, would be in the direction desired by the chartered accountants. I have in my hand a letter from a chartered accountant who has asked for this consideration. At the same time, I cannot believe that there are many of the companies referred to by my noble friend Lord Rennell whose accounts are audited by individuals who have not practised as auditors for the last five, six or eight years. I think if my suggestion were adopted it might be a way out.
THE LORD CHANCELLOR: I have a past in this matter, and I had better reveal it. For a good many years now I have been instrumental in trying to get a Bill brought in to put the accountants' profession (when I say "accountants" I am talking of the various bodies which constitute accountants) on a more satisfactory basis. I think it is thoroughly undesirable that wholly unqualified people should act as accountants. It is wrong not merely in the interests and protection of the public, but also I think in the interests of businesses themselves. Just as, if you are wise, you take a child to the doctor for an overhaul and to see that everything is all right, so I think businesses ought periodically to go to their doctor for an overhaul, to see that everything is all right. After all, the doctor of business is the accountant, and I certainly look forward to a time when we have a proper Bill dealing with this question, and depart from what I think is the wrong practice of to-day, when anybody who sets up a plate and calls himself an accountant—whether a turf accountant or anything else—can carry
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on. I am sure that noble Lords in all quarters of the House would probably agree with that point of view.
On the other hand, I think we all recognize that there is some difficulty to-day in view of the fact that there are not enough accountants, and therefore trouble arises. When Sir Alfred Mond was Minister of Health and had to bring in his Bill dealing with dentists, he found that there were a large number of unqualified practitioners at that time, and he was very anxious to raise the whole status of the profession. He did it in this way. He said: "Very well, I will allow those people who are practising at the date of the passing of this Bill to carry on, but in future I will have only qualified people. In that way, when unqualified people pass out, you will gradually have a higher standard of skill and competence." I think we might do something on those lines.
I have a very open mind on this question and I would like the noble Lord to withdraw his Amendment. I am not making a promise, but I will gladly consider this whole matter between now and the Report stage and discuss it with him to see what we can do about it. At the present time I am disposed to keep these words here, but I am not at all wedded to the date. If we have a wrong date, in order to avoid hardship by all means let us have another date. There is no substance in that at all. I am disposed to keep the words with a date, but as your Lordships will see from my Amendment to page 15, line 42, I am disposed to say that this subsection shall not apply to exempt companies. We might allow the type of company which owns the little butcher's shop or greengrocer's shop (which very often is owned by a private company) and which will be exempt under the meaning of this Act, for the time being to carry on as it does to-day, at any rate until we get our consolidation Act. I think that might be a solution. I would ask the noble Lord to be good enough-to withdraw his Amendment now, on the understanding that I will consider this matter between now and the Report stage, and on the understanding that I am going to move my Amendment, though that also will be subject to discussion and consideration between now and the Report stage.
LORD LATHAM: The Amendment of the noble and learned Viscount, the Lord

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Chancellor, does not refer to this point, if I may say so with respect. It refers to the question whether a partner of a director shall be competent to be an auditor of the company of which his partner is a director.
THE LORD CHANCELLOR: It is rather wider than that. It is to insert at the end of page 15, line 42, "Provided) this subsection shall not apply …"
LORD LATHAM: I beg the noble and learned Viscount's pardon. I have not got that one.
LORD DE L'ISLE AND DUDLEY: I thank the noble and learned Viscount, the Lord Chancellor, for his comments on this matter, and I certainly am not going to be arbitrary about it. It has, I think, provoked a useful discussion, and particularly useful was the contribution of the noble Lord, Lord Rennell. It may well be that the Amendment put down by the noble and learned Viscount, Lord Chancellor, may meet the point, because in the case of small private companies in provincial towns the unqualified accountant—it may be the articled clerk aspiring to be an accountant—will probably operate. I am a member of the accountancy profession, but I am not sure that they would call themselves the healers of business. I think very often they would more aptly be described as the analyst at the coroner's court. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, at the end of paragraph (b) of subsection (1), to insert:
"Provided that this subsection shall not apply in the case of a private company which at the time of the auditor's appointment is an exempt company as defined in the section of this Act relating to the inclusion of a private company's accounts in its annual return."
The noble and learned Viscount said: This is the Amendment I have put down, and which I beg to move. We discussed this, broadly speaking, on the last Amendment. I am saying here that subsection (1) is not to apply in the case of an exempt company. I believe that is a fair way out of the difficulty. I may say that I have some misgivings about it, as I expect have all your Lordships, but on the whole I think it is a fair compromise. I beg to move.
Amendment moved—
Page 15, line 42, at end, insert the said proviso.—(The Lord Chancellor.)
LORD RENNELL: May I express my gratification for the Amendment, which I think goes a long way toward meeting the difficulty.
LORD LATHAM: I would not in any way wish to be ungrateful to the noble and learned Viscount, the Lord Chancellor, for this Amendment, but I think your Lordships should appreciate that in substance it will mean that the bulk of private companies will be exempt from the obligation to have a qualified auditor. If that be the case, it may happen—indeed it will happen—hat among the companies thus exempt from having a qualified auditor there will be thousands of companies carrying on quite substantial businesses. They will not be limited to the grocer, the candlestick maker, and the small trader whose accounts can be done on Saturday evening by the bank clerk or the bank clerk's junior. There will be very important private companies having obligations to the public, to debenture holders, to creditors, and also to their shareholders, whose accounts will be prepared—and they will be entitled to have them prepared—by unqualified persons. I submit to your Lordships that that is not a desirable state of affairs and that it is against the whole purpose of this Bill.
After all, as I see it, the whole basis of limited liability is in the nature of a bargain made between those who wish to trade under the reliefs and escapes of a limited company, and the community; a kind of social contract by which the persons trading escape personal liability, which they would suffer but for the protection of a limited liability company, in return for which they are asked to comply with certain requirements—to comply, in fact, with requirements as between themselves as shareholders and as between the company and the public. For instance, private companies henceforth are to be required to furnish to their shareholders copies of audited accounts; private companies are to be restricted in their powers to appoint and dismiss auditors; private companies are to be required, save they be exempt, to file the balance sheet and the documents annexed thereto with the annual return. All those steps are, I submit, proper steps for the protection of the

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public. Yet the accounts which are required to be circulated need not be accounts prepared and audited by a qualified person. Those accounts can be accounts which are of no value at all; they can be accounts which, in fact, are dangerous, in that they mislead as a result of their inaccuracy, and shareholders will probably suffer more from having the opportunity of perusing Inaccurate accounts than from not having day accounts to peruse at all.
Therefore, whilst I appreciate fully the gesture which the noble and learned Viscount, the Lord Chancellor, has made, I more than share his misgivings as to whether the proposed Amendment is wholly satisfactory. It will leave shareholders and others open to the risks—and they are substantial—of not having accounts properly audited by properly qualified persons. I can speak from experience of this. I have had submitted to me, usually when the company was the subject of analysis in the "coroner's court," accounts which had been audited by unqualified persons which have been simply fantastic and which have been largely contributory to the failure of the company, in that those accounts had misled the directors. The average director of a private company is not in less need, but in more need, of qualified advisers in the field of accountancy than directors of public companies, because he himself is often so uninstructed in matters of this kind.
The answer one almost invariably gets from the director is: "I do not know anything about figures; I left it to the auditor." There is no doubt he did leave to the auditor, and the auditor left it to providence, and the company went into liquidation. That may be regarded as the proper concatenation of circumstances. I therefore hope that the acceptance of this way out—and it is no more than a way out—at this stage will not be prayed in aid against the proposals for registration of accountants on a proper basis which may later come before your Lordships' House.
VISCOUNT SWINTON: I regret that I was not here, and could not be here, to hear the whole of this debate. I do not think this is an easy point. I have considered it a great deal and I should just like to add a word. I think that on the whole the noble and learned Viscount the Lord Chancellor (who has, I know,
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given a tremendous amount of personal attention to this, for which we are all grateful to him) has really reached the best conclusion that can be reached in this matter. I am not sure that the noble Lord, Lord Latham (who speaks, of course, with a great knowledge of accountancy, because, if I remember rightly, he himself is a member of that greatest of trade unions—or the next greatest to the Bar, perhaps I should say) really was not patting his case a little too high. He talked about the protection of the creditors.
Here we are dealing with the exempt private company, and only with the exempted private company. Of course, the exempted private company does not have to publish its accounts, so that the creditor does not have a chance of seeing them. As for the shareholders, the appointment of the auditor is a matter for them and, I think I am right in saying—the noble and learned Viscount wilt correct me if I am wrong—there is no difference in the rules about the appointment of an auditor as between a public company, a private company, and an exempt private company. The auditor has to be appointed by the shareholders, and each individual shareholder receives a copy of the accounts. Therefore, it is within the right of the shareholders to appoint either an unqualified auditor, if I may so describe him, or a member of one of the recognized trade unions. As we are dealing only with the exempt private company here, as otherwise it would create hardship in the case of a number of small companies, and also, as has been said, because there are really not enough people to do the job, I venture to think that the compromise which the noble and learned Viscount has devised and which he advises us to accept is really the wisest step which, at the present time and having regard to all the circumstances, we can take.
LORD SALTOUN: Like the noble Lord, Lord Latham, I am also a member of this great trade union. I would like to say that I think the compromise suggested is, speaking from my knowledge of conditions in Scotland, about the best that could be arrived at. It will affect a great reform quite gently and without doing any harm. I think the corollary of what the noble Lord, Lord Latham, said, would be to force everybody—every private individual—to have his

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accounts audited by a chartered accountant. That, although it would be a very profitable thing for us all, would be going rather too far, because most of these private companies are quite small affairs.
LORD DE L'ISLE AND DUDLEY: I do not wish to prolong the debate on this point. In view of what the noble and learned Viscount the Lord Chancellor has said, I do not intend to move the next Amendment which stands in my name. Being a member of this trade union, I naturally do not wish to appear to be saying anything derogatory to my own profession. I think it gained its status in this country by its own worth and reputation. The case of the exempt company is much more close to that of a partnership, because the balance sheet is not available for publication. I think it would meet the practical needs of the situation if unqualified persons were still permitted to carry out the audit, although if the balance sheet is filed, and the creditors and debenture holders place reliance upon it, I think it is right that qualification should be insisted upon.
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in subsection (2), to leave out "cease to have effect" and insert "apply only in the case of a private company which at the time of the auditor's appointment is an exempt company as defined in the section of this Act relating to the inclusion of a private company's accounts in its annual return." The noble and learned Viscount said: The existing law is this. Under Section 133 of the Act of 1929 it is provided that:
"None of the following persons shall be qualified for appointment as auditor of a company … (b) except where the company is a private company, a person who is a partner of or in the employment of an officer of the company."
So in the case of a private company one may appoint a person who is a partner, or one who is in the employment of an officer of the company. Paragraph (c) of this clause says:
"The exception in the said paragraph (b) for private companies shall cease to have effect."
I am proposing to leave out the words "cease to have effect" and to insert the words "shall apply only in the case of"—I am not reading it all—"the exempted
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private company." This is intended to deal with the Amendment which is down in the name of the noble Lord, Lord Hawke. I think the substance of the two Amendments is the same, but I got the draftsman to put it into language which he thought was entirely appropriate. I beg to move.
Amendment moved—
Page 16, line o, leave out ("cease to have effect") and insert the said new words.—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 16, as amended, agreed to.
Clause 17:
Appointment and remuneration of auditors.
17.—(1) The auditors of a company, appointed at any annual general meeting shall be appointed to hold office from the conclusion of that, until the conclusion of the next, annual general meeting; and at any annual general meeting a retiring auditor, however appointed, shall be reappointed without any resolution being passed, unless—

(a) he is not qualified for reappointment; or

(b) a resolution has been passed at that meeting that he shall not be reappointed (whether or not the resolution appoints some other person instead of him); or

(c) he has given the company notice in writing of his unwillingness to be reappointed;

and, where at an annual general meeting no auditors are appointed or reappointed, the Board of Trade shall appoint a person to fill the vacancy.
The Lord Chancellor moved, in subsection (1), to leave out "shall", where that word last occurs, and insert "may". The noble and learned Viscount said: This is a small Amendment. There may be cases in which it is not desirable that the Board of Trade should appoint an auditor. For instance, supposing that just before an annual general meeting the auditor who was the designated auditor dies, and that the annual general meeting takes place the next day, when the members have not got anybody in mind at the moment—the man they were going to have is dead. In such circumstances as that it is obvious that the Board of Trade should hold its hand in order that the shareholders may have an opportunity of dealing with the matter in the way they desire. It allows us greater latitude not to have the word "shall" but to have the word "may" in order to deal with that class of case. I beg to move.
Amendment moved—
Page 16, Line 30, leave out ("shall") and insert ("may".)—(The Lord Chancellor.)
On Question. Amendment agreed to.
THE MARQUESS OF READING THE MARQUESS OF READING moved to leave out Clause 17. The noble Marquess said: I have put down this somewhat drastic Amendment in regard to Clause 17 because of the difficulty of seeing what is the precise point of altering the existing state of affairs in regard to the appointment of auditors at an annual general meeting. Under the Act of 1929, as I understand it, the position is that every company at each annual general meeting has to appoint an auditor, who Shall hold office until the next annual general meeting. If the company does not appoint, then the Board of Trade may appoint on the application of a member of the company. That involves a positive process at the annual general meeting of the company. The company has to do something—it has to appoint an auditor at that meeting.
The Act of 1929, I think it is fair to say, had in mind a situation which may, to some extent, be behind the clause we are at present discussing. The 1929 Act took over a section from an earlier Act—I think the Act of 1908. Before this particular procedure came into being, there was a time when some anxiety was caused by the fear that if some auditors were, in a phrase which I found in one of the books, "inconveniently faithful in the discharge of their duties", they might be got rid of by the directors. There was a need to guard against that kind of situation. But I suggest that, with the existing law as it stands under the 1929 Act, the possibility of that situation occurring is really guarded against adequately. What is now suggested is that instead of the active process of auditors being elected at the annual general meeting of a company, there shall be a negative process whereby, unless certain action is taken, these auditors are, so to speak, automatically re-elected from year to year. That seems to me open to very considerable criticism, and unless some really substantial case can be made for varying the existing procedure—which so far as I know has worked with sufficient smoothness—I suggest there is no reason for this clause to remain in the Bill, and that it should be deleted. It is on that ground that we have moved for the deletion. I beg to move.
Amendment moved—
Leave out Clause 17.—(The Marquess of Reading.)
LORD DE L'ISLE AND DUDLEY: I beg to support the Amendment moved by the noble Marquess. It seems to me that unless very good cause is shown for altering the existing Act, an auditor's appointment should be made subject to a positive process. He is not a member of the company but he is for some purposes an officer, and I think that his appointment should be subject to active resolution.
LORD SALTOUN: I would like to support this Amendment very strongly. This clause makes it extremely difficult for the directors of a company to remove an auditor, especially an auditor who does not want to be removed. It forces them to pass a resolution, it gives the auditor the right to circularize the company, and it gives him a very powerful position. He is a man who may not have a single share in the company and has no responsibility for the result of his actions. It seems to me that this clause proceeds upon the idea that all directors are bad and that all auditors are good. I submit, very humbly, to the noble Lords opposite, that Parliament has no right to take up that position. I hope that there are very very few black sheep in the flock to which I belong, but I also think that directors, who are after all responsible to the members of the company, are as a rule doing a very good job in this country.
I want to put a possible case, and I am going to assume a very black sheep as an auditor. Let us suppose there is a small company carrying on a business which is also carried on by many other small companies and some very big companies. Let us suppose there is a company which, like Aaron's rod, is eating up all the small companies. Such cases are not unknown to your Lordships, and I think some companies have a director whose special business it is to look out for small companies that can be absorbed.
Let us suppose there is an auditor of a small company who has some affiliation or some friendly relations with a big company. The directors may suspect it—they cannot know—but they dare not put into resolution and circularize suspicions among the company. The directors, after all, are responsible to the shareholders for the business, and the auditor is not. It appears to me that an auditor could misuse his position to the detriment of the

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company, entirely under cover of this clause and without anybody being able to say anything to him. That is a possibility which I hope is very remote from the high character of my profession, but the clause does proceed upon the basis that it is impossible for an auditor, and that it is quite impossible for a director to want to remove an auditor on really good grounds. I therefore earnestly hope that His Majesty's Government will consider this matter, because I should be very sorry to see this clause incorporated in the Bill as it at present stands.
LORD RENNELL: I do not go quite so far as my noble friend who moved this Amendment, because there are certain parts of the clause which I think we should all like to see remain. Where an auditor is removed, if he thinks he has been treated unjustly he should have an opportunity of explaining to the shareholders why he should not be removed. I would like to move for a compromise on the practical issue rather than the shady side of life to which the noble Lord referred. I would like to take the case of a company which started in a small way and employed a very adequate firm of local auditors to do the work. They grow to a size which has gone beyond the capacity of the local firm to carry out the audit, or their business has grown in directions with which the auditors are not familiar—because auditors have specialities like other professional people. This clause makes it invidious to change the auditor when the company has outgrown his or their work without practically doing so in writing and really damaging the reputation of the firm of auditors in question. That is not fair on anybody concerned. I would personally like to see a compromise between the better parts of this clause with the positive resolution to which the noble Marquess and others have referred.
VISCOUNT ELIBANK: I wish to intervene only for a few minutes. I wish to support the noble Marquess who moved the deletion of this clause from the same point of view as he did himself. I want to put the other side of the case, which has not been put this afternoon, and that is the point of view of the shareholder. I am talking of public companies and not private companies. The shareholders of public companies regard their rights to the appointment of the auditor with very,
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very great respect, so much so that at annual general meetings it is not a director who moves the appointment of the auditors but a shareholder, and the motion is seconded by a shareholder. The actual motion is put to the annual general meeting by the shareholders. As often as not, and in fact generally, they fix the fee of the auditors at the same time. My noble friend Lord Reading suggested in his speech that the present practice was an admirable one, and I feel that if it is departed from, whilst there may be some greater protection against the directors (if that be necessary) the shareholders will feel very aggrieved indeed if that right is taken away from them. Therefore generally I support the noble Marquess, Lord Reading, in his motion.
THE LORD CHANCELLOR: Whilst I am very anxious to meet your Lordships' wishes, I confess that I regard this matter from a somewhat different angle. My experience, which is experience in the courts and, to a certain extent, of the rather more seamy side of companies, leads me to say this. Auditors are sometimes placed in a very unfair position, and pressure is not infrequently put on auditors—quite unsuccessfully, of course, on auditors of the highest repute—to agree to practices with which they ought not to agree.
Therefore I think it is of the highest importance that the auditor should be completely independent to do what he thinks is right. If I am told that this clause has the effect of making it difficult for a bad company to change its auditor, I say it is for that reason I strongly support it. On the other hand, I do say this: I am fully conscious of the fact that the largest oak comes from a small acorn, and some companies start in a small way, with a little man quite capable of dealing with them in their infancy. But when they grow too big for him you have to go to bigger people to take over. When that happens, I am anxious to make the change so as to inflict the least amount of hardship or discredit on the little man.
My view of the clause is this. Under subsection (1) (b) you say that:
"a resolution has been passed at that meeting that he"—
as an old auditor—
"shall not be reappointed (whether or not the resolution appoints another person instead of him)."

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I should think you are doing enough if you appoint some other person, without asserting that the old auditor be not reappointed. I should think that if you appoint someone else it follows that he is the person appointed. But I will look at it again from the other point of view, in so far as that may meet your Lordships. I want to do this thing gently in the sort of case I see. I am sure from my experience that it is right and sound to make it rather difficult for a company to change its auditors without adequate reason. After all, I can rely upon the Cohen Committee, for they are people who speak with experience, and that is plainly the view they take. It is for this reason that I am prepared to consider amendment on the lines suggested.
VISCOUNT SWINTON: I really think that that is the judgment of Solomon, if I may say so. I am quite sure we have to meet the case which the Lord Chancellor has put, where a bad man wants to get rid of a good auditor. But you have also to meet the case of the good company which wants to get rid of, not a bad auditor, but an inadequate auditor. If such is the case you will have to proceed by appointing Mr. A. with Mr. B, and that is not sensible. On the other hand, you certainly do not want to make any difficulty for Mr. B, and in fact in 99 cases out of a zoo it would be a friendly arrangement, and it would be said: "We will find work for Mr. A in a subsidiary or make it up to him in another way." So long as the noble and learned Viscount will put down his own Amendment on the Report stage I believe it will be exactly what we all want to do.
THE LORD CHANCELLOR: I will not pledge myself definitely, but that is the present trend of my mind. I shall try and get the authority.
VISCOUNT SWINTON: It will rest with you then? We do not need to conjure our imaginations.
LORD SALTOUN: I entirely agree with the suggestion of the noble and learned Viscount, the Lord Chancellor.
VISCOUNT MAUGHAM: I am grateful to the noble and learned Viscount, the Lord Chancellor, for his suggestion. It is not easy for a company to get rid of its auditor at the present time, even if it wants to. It is not such an easy thing, and I rather stress what I have said because it
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is quite clear to me that: both my noble friend Viscount Swinton, and the noble and learned Viscount opposite, are quite prepared to believe that directors are bad, but reluctant to believe that an auditor can be bad or unreasonable. Directors are responsible for the business of the company, and if they fail it is not only to the disadvantage of themselves but to the disadvantage of the company; but the auditor is not responsible for more than his duties under the Act, and I submit very respectfully to the noble and learned Viscount opposite that the Act actually lays on the auditor very much heavier duties and very mach greater powers in the latter part. I do hope that the noble and learned Viscount will consider this before the next stage and go as far as he can to meet us.
THE MARQUESS OF READING: In putting down the original Amendment I had neither the hope nor the desire that the whole clause would disappear. I thought it was important that a general discussion should be raised on this important matter. So far as I am concerned, I am perfectly prepared to accept the suggestion that the noble and learned Viscount has made but there may be one or two things which might be discussed before his actual Amendment is put down, if he will give us the opportunity. In these circumstances I propose to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 17, as amended, agreed to.
LORD CHORLEY LORD CHORLEY moved, after Clause 17, to insert the following new clause:
Construction of references to documents annexed to accounts.
" . References in the principal Act and this Act to a document annexed or required to be annexed to a company's accounts or any of them shall not include the directors' report or the auditors' report (which are by the principal Act required to be attached to the balance sheet)."
The noble Lord said: The object of the proposed new clause is to make it unnecessary for the auditors to comment on the directors' report. Clause 12 (7) (a) provides that for the purpose of the Bill, except where the context shows to the contrary, any reference to a balance sheet, or profit and loss account, or consolidated account, shall include any notes thereon, such as the report of the directors. It is obviously undesirable as it stands. As it stands, it would be arguable that it places on auditors the Obligation to com-

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ment on the directors' report. It would obviously be undesirable to have obligations of that sort. The object of the new clause is to make that quite clear.
Amendment moved—
Page 17, line 45, after Clause 17 insert the said new clause.—(Lord Chorley.)
On Question, Amendment agreed to.
Clause 18:
Director and Secretary.
18.—(1) Every company shall have a director and a secretary, and a sole director shall not also be secretary.
(2) For any reference in the principal Act to a company's secretary or other chief officer there shall accordingly be substituted a reference to the company's secretary.
LORD BALFOUR OF INCHRYEhad given notice to move, at the end of subsection (2), to insert, "or to such person as may for the time being by the direction of the directors be acting as or in place of the company's secretary." The noble Lord said: In the various sections the secretary is required to do things or to sign documents. The secretary may fall ill, or be absent abroad, or be in other ways incapacitated. As the Bill stands, there is no provision to allow an assistant or deputy secretary to work. The noble and learned Viscount, the Lord Chancellor, however, has put down an Amendment which substantially covers the same point as mine and I am willing to withdraw my Amendment if he will say why it needs a much longer amount of print to say what I have said in two lines. We are really saying the same thing.
Amendment moved—
Page 18, line 6, at end insert the said words.—(Lord Balfour of Inchrye.)
THE LORD CHANCELLOR: I can only reply that I gave this Amendment to the Parliamentary draftsman and he put it into the proper legal language. However, if the noble Lord wishes to move it in the form in which he put it down he may do so, but I can assure him that I derive my Amendment from his ingenuity.
LORD BALFOUR OF INCHRYE: I am very grateful to the noble and learned Viscount, and I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, after subsection (2), to insert the following subsection:
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"(3) Anything required or authorised to be done by or to the secretary may, if the office is vacant or there is for any other reason no secretary capable of acting, be done by or to any assistant or deputy secretary or, if there is no assistant or deputy secretary capable of acting, by or to any officer of the company authorised generally or specially in that behalf by the directors."
The noble and learned Viscount said: This is the matter which we have just been discussing. The effect of this Amendment is the same as that of the Amendment which my noble friend Lord Balfour of Inchrye has withdrawn. I beg to move.
Amendment moved—
Page 18, line 6, at end insert the said new subsection.—(The Lord Chancellor.)
On Question, Amendment agreed to.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved, after subsection (2), to insert the following subsection:
"(3) Nothing in this Act or the principal Act shall be deemed to prevent the appointment as secretary of a company of a partnership firm."
The noble Lord said: In many cases, at present, firms or companies act as secretaries for a company or a group of companies. I know that this is especially so in the case of Scottish investment trust companies, and, to a lesser extent, with English investment trust companies. The practice also prevails in both countries with companies other than investment trusts, such as tea, rubber and mining companies. I think that your Lordships will agree that the practice is not a bad one, and that it has not meant any hardship or produced undesirable results. I think, too, that it will be agreed that it does lead to economy and efficiency in administration. I am informed that under Scottish law a firm is a legal entity, and therefore, would presumably come within the provisions of Clause 18. In England, a firm is not recognized as a legal entity, but, on the other hand, there are many cases where firms act as secretaries of companies. I therefore suggest that the clause should make it clear that a firm can act as a secretary. That is the purpose of the Amendment. I beg to move.
Amendment moved—
Page 18, line 6, at end insert the said new subsection.—(Lord Balfour of Inchrye.)
THE LORD CHANCELLOR: We cannot accept the Amendment in this form, and for this very good reason. If you say "Nothing in this Act or the principal Act

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shall be deemed to prevent the appointment as secretary of a company of a partnership firm", it might at once be claimed that you are saying in express words that you are allowing firms to act as secretaries and so they cannot act as auditors or in some other capacity. In England, a firm cannot act for the very best of reasons; that is, that a firm does not exist at all. It is simply a sort of shorthand phrase for expressing the individuals who compose the firm. In Scotland the matter is different. There a firm is a legal entity.
I think that I can deal with the point which the noble Lord has in mind. I am quite anxious that in Scotland a firm should be able to act. I think that what we really need is a slight amendment to the next clause. It is there that the requirement with reference to the register of directors makes the only difficulty—if difficulty there be—about a firm acting. As paragraph (a) deals with an individual and paragraph (b) deals with a corporation, probably we ought to deal with a firm at that point. If the noble Lord will withdraw this Amendment, I will look into this and see that the position of a firm in Scotland is safeguarded, and that a firm in Scotland can act as auditor or secretary, or as any other officer of a company. I believe that the right way of doing it is by having some little provision in Clause 19 which is the only clause, at the present time, which could—if indeed it can—prevent a firm acting as secretary.
VISCOUNT SWINTON: May I ask a question upon this? As the wording in the Bill stands, a rather tiresome and stupid difficulty arises. You cannot do better than appoint as secretary of a company a well-known firm of accountants. That is a very common practice. Actually, as this stands, if you appoint an eminent firm of accountants who, it may be, have as many as twenty partners, you have got to set out the names of all of them on the notepaper and other documents of your concern. If one partner in the firm of accountants dies, or another is added, you have to amend the rigmarole on your note-paper, and so forth, accordingly. Obviously, that is nonsense, and I take it that that is a matter which will be looked into.
THE LORD CHANCELLOR: You might of course, get difficult questions as
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to who were the members of a firm at a particular time. However, as I have said, I will look into this, with a view to meeting the noble Lord's point.
LORD BALFOUR OF INCHRYE: I thank the noble and learned Viscount and beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 18, as amended, agreed to.
Clause 19 [Register of directors]:
THE LORD CHANCELLOR: This is a mere drafting Amendment to correct a wrong reference. I beg to move.
Amendment moved—
Page 18, line 23, leave out ("subsection (3)") and insert ("subsection (4)").—(The Lord Chancellor.)
On Question, Amendment agreed to.
VISCOUNT BRIDGEMAN VISCOUNT BRIDGEMAN moved, after subsection (3), to insert the following subsection:
"(4) Paragraph (d) of subsection (1) of section one hundred and forty-five of the principal Act (by which every company to which that section applies is required in all trade catalogues, trade circulars, show cards and business letters to state with respect to every director his nationality of origin, if his nationality is not the nationality of origin) shall cease to have effect."
The noble Viscount said: Your Lordships will remember that, under Section 145 of the principal Act, foreign nationals are obliged to show their nationality on the letter headings, business correspondence and so forth of limited companies. Those who have a nationality which is not the nationality of origin must show their nationality of origin, unless they are specially exempted in special circumstances by the Board of Trade. The Amendment does not seek to make any alteration in regard to the law as to directors who are of foreign nationality. I am not suggesting that we should alter the present arrangements, by which they have to show their nationality. But it does seek to provide that those who have acquired British nationality should no longer be obliged to show their nationality of origin.
I think that it is worth while to look back to the origin of the present arrangement. This was in an Act called the Companies (Particulars as to Directors) Act, 1917. It was tied up, I think, with the Registration of Business Names Act in the middle of the last war. It is

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possible to imagine that this Act was really intended as a security measure in time of war. Between 1917 and 1929 not much notice seems to have been taken of this matter, probably because the movement of foreigners into this country was not very large. Therefore, when the present principal Act passed in 1929, these provisions which came from the Companies (Particulars as to Directors) Act, 1917, were incorporated, as I understand it, in the present Act.
Between 1929 and the present time, however, several things have happened. A very large number of persons have emigrated to this country from Central Europe since 1929. They represent, your Lordships may think, the same movement as that of the Huguenots. They are the Huguenots of modern times. They came here, bringing their skill and their wealth, and also their families. In many cases they brought with them young children, babies in arms even, and to this day those children have no knowledge of their country of origin and speak no language but English. These foreigners to whom I refer have prospered here, and in due time they have acquired naturalization, after most searching inquiries by the Board of Trade and after a period, I think, of five years, during which they have had to live here and be of good behaviour. During the late war, I believe, that period was extended to something like ten years. In view of these considerations, I think there can be no doubt of the bona fides or of the fitness to do business of these people who have already acquired a certificate of naturalization.
I put it to your Lordships that if it is decided, in this country, to grant British nationality to any foreigner, we should grant that nationality without any reservation at all. This section of the principal Act which I am seeking to amend does imply reservation. It implies that a man is not really British, and that you have to parade his foreign nationality, even though the Home Office have agreed that he shall acquire British nationality. It is not really fair, I think, to do that. It holds back something from the completely British nationality which we have promised to give, and it invites everybody who reads a letter heading to take note that the British citizenship of a man
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or woman is qualified to some degree. I know that mistakes have been made and that the public have to be protected if the wrong man is naturalized and does business in this country. But may I put it that this is not a matter for the Board of Trade, it is a matter for the Home Office; and it will complicate legislation far too much if we try, in an Act of Parliament which belongs to one Department, to protect the public from the shortcomings of another? I do not think we should do that, therefore I move this Amendment.
I have put it in no Party spirit whatsoever, but merely on the grounds of sound administration and of equity and fair dealing with this class of person. I think we should give British citizenship, when we give it, with both hands, and leave security questions to be dealt with in the proper way. I hope this Amendment may find favour in this or some other form on the Benches opposite, and I beg to move.
Amendment moved—
Page 18, line 25, at end insert the said new subsection.—(Viscount Bridgeman.)
LORD CHORLEY: I am very glad to be able to say we accept this Amendment. We are very much obliged to the noble Viscount for having brought up the matter, because the spirit in which he has moved the Amendment is entirely the spirit in which the Government look at this matter. He very properly pointed out that when the great benefit and privilege of British nationality is conferred upon an alien it should be given in no spirit of meanness, an argument with which we entirely agree. Many of these aliens, particularly the Germans and, among these, the German Jews, have very strong feelings about being associated with the country from which they were expelled in such a ruthless manner. That is a feeling with which one can entirely sympathize, so we are much obliged to the noble Lord for moving this Amendment, which we accept with great pleasure. It will involve one or two consequential Amendments to the Bill, and also to the Registration of Business Names Act, but that can be provided for at a later stage.
VISCOUNT SWINTON: I am entirely for this Amendment—there is no possible argument against it—but can we clear the whole business up and deal with the Registration of Business Names Act under this Bill?
LORD CHORLEY: We hope to be able to do so, and I am informed that this is possible. If it is we shall certainly take the opportunity of doing so.
VISCOUNT BRIDGEMAN: I am extremely obliged to the noble Lord for the way in which he has accepted this Amendment, and I thank him very much.
On Question, Amendment agreed to.
Clause 19, as amended, agreed to.
Clause 20:
Appointment of directors to be voted on individually.
20.—(1) At a general meeting of a company a motion for the appointment of two or more persons as directors of the company by a single resolution shall not be made, unless a resolution that it shall be so made has first been agreed to by the meeting without any vote being given against it.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in subsection (1), after the first "company" to insert "other than a private company." The noble and learned Viscount said: Clause 20 requires the appointment of directors to be voted on individually, and I have had representations made to me that whilst that provision was proper for public companies it is likely to cause considerable confusion at meetings of private companies, and is likely to be more honoured in the breach than in the observance. That being so, I think we should make it applicable only to public companies, and not to private companies. I beg to move.
Amendment moved—
Page 19, line a, after "company" insert "other than a private company."—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 20, as amended, agreed to.
THE LORD CHANCELLOR: We have finished Clause 20 and we now start a rather substantial Amendment which needs a good deal of consideration and with which the noble Viscount, Lord Maugham is concerned. I do not know whether it would be convenient to your Lordships, but I think it would not be desirable to embark on that discussion, which must take some time, at this hour. If your Lordships are agreeable I propose to move that the House do now resume.
Moved, that the House do now resume.—(The Lord Chancellor.)
VISCOUNT SWINTON: Could the noble and learned Viscount say when we shall be taking this again? I think it would be to the convenience of the House to know.
THE LORD CHANCELLOR: I hope that it will be on Monday and Tuesday of next week.
VISCOUNT MAUGHAM: I should be very grateful if the House could adjourn at the present moment. I have a great deal to say on this, and I have been urged to move it by very important bodies.
On Question, Motion agreed to and House resumed accordingly.

CHURCH COMMISSIONERS MEASURE 1947.
6.35 p.m.
THE LORD BISHOP OF LONDON THE LORD BISHOP OF LONDON rose to move to resolve, That in accordance with the Church of England Assembly (Powers) Act, 1919, this House do direct that the Church Commissioners Measure, 1946, be presented to His Majesty for the Royal Assent. The right reverend Prelate said: I am sure that I shall have the sympathy of the noble Lords in the fact that on the first occasion that I have the privilege of addressing your Lordships I have to do so at the end of so exhaustive—4 will not say exhausting—a debate. However I am comforted by the reflection that the Measure I have to bring forward has so far been found entirely without controversy. At any rate, the Ecclesiastical Committee of both Houses have examined it with their usual care, and they have found no cause for controversy in it whatsoever. Therefore I will deal with the matter as briefly as I can, consonant with the courtesy due to the House.
The object of the Measure is to amalgamate the two great financial organizations of the Church of England the Ecclesiastical Commissioners and Queen Anne's Bounty. I believe noble Lords are sufficiently well aware of the history and of the purpose of these two organizations, though they vary to some extent. The Ecclesiastical Commissioners were first appointed in 1836, whereas Queen

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Anne's Bounty goes back to 1704. The Ecclesiastical Commission handle the great common fund which was derived for the most part from the proceeds of some of the greater ecclesiastical properties, and Queen Anne's Bounty handles the fund which Her Gracious Majesty handed back to the Church, consisting of the first fruits and tenths that had been taken by the Crown in the reign of Henry VIII. Queen Anne handed them back to the Church in order that they might form a fund from which the poor clergy could be helped. Since those days the Bounty has had the duty of handling tithe and the tithe rent charge.
It is now proposed to amalgamate these two bodies, and it seems to me there are at least three good and obvious reasons why that amalgamation should take place. In the first instance, I think that the present organization is out of date. It does not represent anything like that democratic principle which is so dear to our hearts at the present time. It deals, of course, with business concerning the rank and file of the clergy, yet the rank and file of the clergy have not been represented on these bodies since they were instituted. The great new organization of the National Assembly of the Church of England has grown up, yet that Assembly has no power of sending representatives to these bodies. In short, the present organization is out of date. It is also clumsy and unwieldy. The Ecclesiastical Commissioners constitute a body which is not very great in size, but when you come to Queen Anne's Bounty there are as many as 700 Governors. I think that most of the 700 are not aware of the honour that has been done to them.
VISCOUNT SWINTON: No emoluments?
THE LORD BISHOP OF LONDON: No emoluments. But it does seem that the time has come when a less unwieldy instrument for arranging the finances of the Church should be found. I think, also, that we ought to recognize that at the present time there is a certain amount of overlapping. Out of 12,000 incumbents in the country, 11,000 are helped by one or other of these two bodies, and a great number of them by both. It is extremely difficult for the incumbent to know to which body he should apply for certain purposes. If he wants to get his house
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repaired, he applies to Queen Anne's Bounty; if he wants to get it improved, he applies to the Ecclesiastical Commissioners; if he wants to sell his house, he applies to Queen Anne's Bounty; if he wants to sell any of his glebe he goes to the Ecclesiastical Commissioners. There are many occasions when the poor man does not know to which body he should apply, and very often he ought to apply to both.
I think it is clear that there is a good case for the amalgamation. What is it that it is proposed to do? It is proposed to make a new organization which shall be less unwieldy, but it is expected, if the arrangements are carried out as suggested, that the new organization will embody the old principle of incorporating into the Governors a number of high officers of State. We should be very sorry indeed to lose the old historical connexions with the high officers of State. There is no necessity for those officers to be members of the Church of England. In the past they have been very ready to accept the honour, and often have performed very great services to the Church. I understand that in this case they have already been approached, and have signified their readiness to serve. The new organization will also embody a democratic principle because the Church Assembly will have an opportunity of sending its representatives direct to it.
The organization will consist of about 100 Commissioners who will meet once a year, or more often if it is found necessary. The monthly business will be done by a Board of Governors, consisting of twenty-seven—quite an ample number for that type of work—but the day-to-day work will be done by an Estates and Finance Committee, consisting of seven members. I think the organization promises to be business-like and there is good reason to believe that it will meet the needs of the Church far better than the two organizations which are functioning at present can do so long as they remain separate. I think that is all I need say at the present moment, but if your Lordships would like to put any questions I can only say that I will endeavour to answer those questions to the very best of my ability. But if your Lordships receive this Measure with the same unanimity with which it has so far been received I shall indeed be a happy man.
Moved to resolve, That in accordance with the Church of England Assembly (Powers) Act, 1919, this House do direct that the Church Commissioners Measure, 1947, be presented to His Majesty for the Royal Assent.—(The Lord Bishop of London.)
VISCOUNT SWINTON: My Lords, I think it is singularly appropriate that this proposal to amalgamate these two great corporations should come before us when we have just concluded our discussion of a Companies Bill dealing with amalgamation and consolidation. I am sure that this Measure will commend itself to your Lordships. I hope that this consolidation will be a great success. It will certainly be a comfort in one department of life, at any rate. In these days the incumbent will know to which Department of State he has to apply—a thing he seldom knows at the present time. I trust that its consolidated accounts will show a most admirable result.
LORD RENNELL: My Lords, may I associate myself with what has been said by the noble Viscount who has just sat down. After a long and somewhat laborious session, this is a Measure which should not pass unnoticed, because here there is something of great historical significance. Some may regret the passing of old institutions. To those of us who have followed this Measure at all, it has been overdue for many years, so that in the regret that we may have at seeing a piece of our antiquity pass into history we can congratulate those who have succeeded in getting unanimity for this Measure.
LORD WALKDEN: My Lords, on behalf of those associated with me on these Benches, I should like to say that we very heartily welcome this Measure. I do so personally as a Churchman. I am most anxious to see the position of the Church enhanced in the eyes of the public. This very business-like arrangement will certainly help in that direction. I trust that great blessings may come from the new arrangement, and that incumbents will be happier and less worried. I hope that the new arrangement will be able to put them in a more comfortable position in life. Many of them are living under considerable hardship, and I am sure that the public would wish to see them in a happier position than that in which they
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are at the present time. I have great pleasure in supporting this Motion.
On Question, Motion agreed to and ordered accordingly.

TENDRING HUNDRED WATER AND GAS BILL. [H.L.]
The Lord Chancellor acquainted the House, That the Clerk of the Parliaments had laid upon the Table the Certificate from the Examiners that the further Standing Orders applicable to the Bill have been complied with.
The same was ordered to lie on the Table.

HAVANT AND WATERLOO URBAN DISTRICT COUNCIL BILL. [H.L.] DUDLEY CORPORATION BILL. [H.L.]
Report from the Committee of Selection, That the following Lords be proposed to the House to form the Select Committee for the Consideration of the said Bills, namely:

L. Carrington.

L. Hindlip.

L. Holden.

L. Craigmyle.

L. Belstead (Chairman).

Agreed to; and the said Lords appointed accordingly.

TENDRING HUNDRED WATER AND GAS BILL. [H.L.]
Committed: the Committee to be proposed by the Committee of Selection.

SUNDAY ENTERTAINMENTS ACT, 1932.
Orders made by the Secretary of State for the Home Department extending Section I of the Act to the

Urban District of Barnard Castle;

Urban District of Felling;

Urban District of Ripley (Derbyshire);

Urban District of Sleaford:

Laid before the House (pursuant to Act) for affirmative Resolution, and ordered to lie on the Table.
House adjourned at a quarter before seven o'clock.