Sitting of 30 June 1949

Preamble
The House met at Half-past Two o'Clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  SALFORD CORPORATION BILL
  Read the Third time, and passed.
  MOUNTBATTEN ESTATE BILL [Lords] (By Order)
  Second Reading deferred till Tuesday, 12th July.
  TEESSIDE RAILLESS TRACTION BOARD (ADDITIONAL ROUTES) PROVISIONAL ORDER BILL
    PIER AND HARBOUR PROVISIONAL ORDER (SOUTHWOLD) BILL
      PIER AND HARBOUR PROVISIONAL ORDER (CRARAE) BILL
      Read the Third time, and passed.
  EDINBURGH AND MIDLOTHIAN WATER ORDER CONFIRMATION BILL
  Considered; to be read the Third time Tomorrow.

MOTOR VEHICLES (OFFENCES)
Address for,
"return showing the number of offences relating to motor vehicles in England and Wales, the number of persons prosecuted for such offences, the results of the proceedings in magistrates' courts, and the number of alleged offences in respect of which written warnings were issued by the police, together with the number of persons concerned, during the year ended the 31st day of December, 1948."—[Mr. Younger.]

ORAL ANSWERS TO QUESTIONS
  EDUCATION

    School Entry (Places)
    Mr. Piratinasked the Minister of Education if he will give an estimate of the number of five-year-olds who entered
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    school at the beginning of the present school year and of the number who were refused admission.
    The Minister of Education (Mr. Tomlinson): The number of children aged five and under entering primary schools, other than nursery schools, maintained by local education authorities during 1948 was 570,000, of whom rather less than half entered at the beginning of the present school year. I have no information as to the number of children who were refused admission, but it is estimated that 90 per cent. of the five-year-old age-group are in maintained primary schools in 1949, this being a higher percentage than in any other postwar year.
    Mr. Piratin: In view of the concern at the fact that many five-year-old children have not been able to find places in schools, would the right hon. Gentleman try to ascertain what is the position because it may be that some local authorities have not provided him with all the information?
    Mr. Tomlinson: That could hardly be the case, since the information provided shows a better result than any we have had in previous years. We are, however, concerned about the matter and we do seek information.
    Mr. Piratinasked the Minister of Education in view of the legal responsibility of parents to send their children to school at the age of five years, what similar responsibility rests with the local education authorities to provide places and facilities to such children; and to what penalties are local education authorities subject if they fail to provide places for such children.
    Mr. Tomlinson: Section 8 of the Education Act, 1944, puts on local education authorities the duty of securing that there shall be available for their area sufficient schools for providing primary education. If any local education authority fails to discharge that duty, the penalty in the last resort is an order of the Minister enforceable by mandamus under Section 99 (1) of that Act. Under Regulation 15 of the Education (Local Education Authorities) Grant Regulations, 1948, it is a condition of grant that the Minister shall be satisfied that the authority have complied with the requirements imposed

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    on them by or under the Act, and if he is not satisfied he may withhold or make a deduction from the grant.
    Mr. Piratin: Does the right hon. Gentleman recall that a short while ago I drew his attention to a certain education authority which had acknowledged that it had not provided places for five-year-old children? What steps is he taking to ensure that such authorities carry out their duties?
    Mr. Tomlinson: In that particular case, inquiries showed that the five-year-old children were admitted in the term immediately following their reaching that age.

    Mid-Essex Technical College (Teacher)
    Mr. Dribergasked the Minister of Education if he is aware that Mr. E. McLeod Davis, a business consultant and member of the Labour Party, has been dismissed on political grounds from employment as a part-time lecturer at the Mid-Essex Technical College; and if he will make a statement.
    Wing-Commander Millingtonasked the Minister of Education whether he will make a statement with regard to the refusal of the Mid-Essex Technical College to renew the contract of Mr. McLeod Davis on the grounds of his political views.
    Mr. Tomlinson: As a general principle I am absolutely opposed to any test of a teacher's private political views, provided that the accepted rule is observed that teachers should not use their position to propagate those views in the course of instruction. In the present case my information is that the governing body informed Mr. Davis that his appointment as a part-time teacher on a sessional basis would not be renewed after the current session on the ground that he had used his position as a teacher to propagate his own political views. In these circumstances Mr. Davis resigned his appointment before the end of the session. It is obviously of the first importance that any allegations of a breach of the accepted rule should be fully substantiated before any disciplinary action is taken against a teacher, and I have accordingly taken steps to investigate the circumstances of this particular case.
    Mr. Driberg: Could my right hon. Friend say whether, in investigating this case so far, he has got most of his information from the principal of the college, who is known to be openly and strongly biased politically in the opposite direction to Mr. Davis, and whether any inquiries were made amongst his students or fellow-members of the staff?
    Mr. Tomlinson: I have had information from a number of sources, and the reason for the action I now propose to take, to make a full inquiry is due to the evidence or lack of evidence that I have received.
    Wing-Commander Millington: Is the Minister further aware that representations have been made from Mr. Davis's students, many of whom are themselves Conservatives and members of the local young Conservatives organisation, and they are unanimous in saying that in their opinion as students, he has not abused his position as teacher to spread a gospel with which they disagree?
    Mr. Tomlinson: That emphasises the necessity for my proposed action.
    Mrs. Leah Manning: Can my right hon. Friend say whether this investigation will be undertaken by himself or by Mr. Davis's professional organisation?
    Mr. Tomlinson: In the first instance I propose to make this investigation myself, and if I am not satisfied then I will seek the aid of outside persons.
    Mr. Cove: Will my right hon. Friend say whether the teacher will have the right to be represented at this inquiry, or is it a private inquiry?
    Mr. Tomlinson: I am not thinking in terms of an inquiry, but evidence as to position of the teacher will need to be heard by the Minister.

    School Dental Service, Ilkeston
    Mr. Oliverasked the Minister of Education what steps he is taking to induce dental surgeons to take employment in the school dental service; whether he is aware that by reason of the disparity in remuneration between dental surgeons in private practice and those engaged in the education service the Borough of Ilkeston has been without a school dentist for over a year;

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    and whether it is his intention to deal with remuneration as a first step to rehabilitate this branch of the education service in the near future.
    Mr. Tomlinson: The difficulty at Ilkeston has arisen through the death of the school dentist last November. The local education authority have made emergency arrangements for a dentist to deal with urgent cases on two days a month. With regard to the salary difficulties which are holding up the development of the School Dental Service, I cannot add anything to the reply which my right hon. Friend, the Minister of Health, gave to my hon. Friend, the Member for East Wolverhampton (Mr. Baird) on 12th May.
    Mr. Oliver: I have not got that reply, neither do I know what is in it, but would the right hon. Gentleman say whether any effective steps are to be taken to rehabilitate this important service in the education field? Does he not know that the dental surgery commences in the schools?
    Mr. Tomlinson: I certainly know it commences in the schools or prior to the schools at the maternity and child welfare centres. The vexed question of salaries is under consideration at the moment, and until that is settled, it seems to me it is well-nigh impossible through the local authorities to develop the service.
    Mr. Oliver: Could my right hon. Friend say whether there is any prospect of the matter of remuneration being settled in the near future?
    Mr. Tomlinson: I do not know. It all depends on what it meant by "the near future."
    Mr. Kenneth Lindsay: Is it not intolerable that this service, which is the basis of one of the most important parts of the school medical service, should be held up indefinitely in this way? Could not the right hon. Gentleman have consultations with his colleagues on this matter and see whether something could be done soon?
    Mr. Tomlinson: We are in consultation and we are trying to relieve the difficulties as soon as possible.

    New Schools
    Mr. Peter Freemanasked the Minister of Education how many infants' schools and how many secondary schools have been completed since 1945.
    Mr. Tomlinson: The latest information available shows that 38 new primary schools and 13 new secondary schools were completed between 31st December, 1945, and 30th April, 1949. Five of these new schools are classified as infants' schools, but the majority of the others will have helped directly or indirectly to provide additional places for infants. These figures do not include new premises for, or extensions to, existing schools, or new schools, which, though incomplete, are partly in use.

    Welsh Language (Pamphlet)
    Mr. George Thomasasked the Minister of Education whether pamphlet No. 4 issued by the Welsh Department of Education represents the considered policy of his Department in connection with the schools of Wales.
    Mr. Tomlinson: Pamphlet No. 4 on Bilingualism in the Secondary Schools of Wales was published by my Department to help school authorities and teachers in the secondary schools of Wales to deal with their special language problems, and it makes valuable suggestions to that end. These do not imply uniformity, but reserve the freedom of the schools to devise their own curricula and teaching methods.

    Colleges of Technology
    Mr. Ralph Morleyasked the Minister of Education, in view of the recommendation of the Barlow and Percy Reports that a certain number of colleges of technology should be selected for university status, if he is now in the position to give the names of the colleges of technology he will select for university status.
    Mr. Tomlinson: No, Sir. The question is still being considered by the National Advisory Council on Education for Industry and Commerce.
    Mr. Morley: Could my right hon. Friend say when he thinks the Council will issue their report, because there is

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    a great deal of anxiety among some colleges, such as Bradford Technical College over the delay in granting University status?
    Mr. Tomlinson: I am asking them to speed up consideration of this matter.

    University Awards
    Mr. Morleyasked the Minister of Education if he can now make a statement as to his intentions with regard to the putting into effect of the recommendations of the Working Party on University Awards.
    Mr. Tomlinson: As the Working Party contemplated, the recommendations of the Report, in so far as they are adopted, will be carried out by stages. I hope shortly to be in a position to announce my decisions for the academic year 1949–50.

    Teachers (Insurance Claims)
    Mr. Peter Freemanasked the Minister of Education what steps are being taken to simplify the procedure concerning claims under the National Insurance Act and the National Health Act for teachers.
    Mr. Tomlinson: The conditions of sick pay for teachers are primarily a matter for settlement between the teachers and their employing authorities. I understand that the effect of the National Insurance Act has recently been discussed, and that recommendations have been made which should have the effect of simplifying the procedure.
    Mr. Freeman: Would that procedure be along the same lines as that provided by the Civil Service?
    Mr. Tomlinson: I do not know but it will be in accordance with the agreement arrived at between the two parties.

    Divisional Committees, Buckinghamshire
    Mr. John E. Haireasked the Minister of Education (1) if he will take immediate steps to review the decision of the Buckinghamshire County Education Committee to wind up the activities of all but two of the divisional executive committees in the county; and if he will urge the retention of these local committees so that democratic and progressive
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    control of local education can remain in the hands of the people affected;
    (2) what powers county education committees have under his regulations to curtail the existing functions of divisional executive committees.
    Mr. Tomlinson: Subject to their com- plying with the requirements of Part III of the First Schedule to the Education Act, 1944, a local education authority has power to vary an existing scheme of divisional administration. In the case to which my hon. Friend refers I understand that the recommendation of the Education Committee has yet to be confirmed by the County Council as local education authority.
    Mr. Haire: Would my right hon. Friend see that before this decision is approved by the County Council some efforts are made to acquaint the divisional executives concerned, and in any case is it not democratic that a decision like this should first be submitted to the divisional executive committees for consultation?
    Mr. Tomlinson: When it has been before the County Council it will have to be submitted both to the Minister and to the divisional executives and the agreement of the Minister must be obtained before it becomes effective.
    Mr. Lipson: Do I understand the Minister to say that his approval is required before a variation of the scheme is agreed to, and can he say whether any other authority made similar requests to that of the Buckinghamshire County Council?
    Mr. Tomlinson: My permission will be required, and I have not yet received a request in this or in any other case.
    Mr. Haire: When my right hon. Friend is asked to make a decision, will he remember that when control of local education in Buckinghamshire was last in the hands of the county authority at Aylesbury, it was decidedly unpopular; and will he see that necessary progress in education is not subordinated to county rate considerations?
    Mrs. Manning: In view of the further centralisation of education in Buckinghamshire and the loss of local interests will the Minister not have consultations immediately, with his inspectorate and other people in the area to avoid this becoming a critical situation?
    Mr. Tomlinson: I would point out that the Minister is called upon to act when certain things are done. They have not yet been done; if I were to go about seeking mares' nests I could find a good many.

    Annual Report
    Commander Maitlandasked the Minister of Education if he can now say when he will present his Annual Report to Parliament.
    Mr. Tomlinson: The Annual Report for 1948 was formally laid before the House on 27th June. I expect that copies will be available by 22nd July.
    Commander Maitland: Is not that very late in the Session?
    Mr. Tomlinson: Yes, it is late, owing to difficulties with regard to printing.

  PAKISTAN (NORTH-WEST FRONTIER)
  Mr. M. Philips Priceasked the Secretary of State for Commonwealth Relations whether in view of the increasingly hostile attitude of the Afghan Government over the North-West Frontier Province, he will take steps to assure Pakistan that she can count on our full support in the event of armed aggression.
  The Secretary of State for Commonwealth Relations (Mr. Philip Noel-Baker): His Majesty's Government in the United Kingdom have seen with regret the disagreements which there have been between the Governments of Pakistan and Afghanistan about the status of the territories on the North West Frontier. It is His Majesty's Government's view that Pakistan is in international law the inheritor of the rights and duties of the old Government of India and of His Majesty's Government in the United Kingdom in these territories and that the Durand Line is the international frontier.
  Both now and at all times His Majesty's Government are fully conscious of their duty in the light of Pakistan's position as a fellow-member both of the Commonwealth and of the United Nations and they have, of course, been in continuous consultation with the Government of Pakistan. They are con-
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  vinced—and are confident that this view is shared by the Government of Pakistan—that there is no outstanding question between Pakistan and Afghanistan which cannot be settled by peaceful means on the basis of the legal position which I have stated. They are also confident that there could be no question of armed aggression by Afghanistan, who is a fellow-member of the United Nations.
  Mr. Philips Price: Will my right hon. Friend bear in mind that his answer will give satisfaction to a wide circle in the Commonwealth, particularly to those who know the situation on the North-West Frontier?
  Mr. Gammans: Does the right hon. Gentleman mean that he has made it clear to Pakistan that, in the unfortunate event of an aggression actually taking place, it can fully rely upon this country's help?
  Mr. Noel-Baker: The hon. Member, like the rest of the House, knows what has been the value of the Commonwealth in the past as a bastion against aggression, but it does not work by pledges given in advance about hypothetical situations. They are not asked for, and not given.
  Mr. Thomas Reid: Does Pakistan pay the subsidies which the British Government used to pay?
  Mr. Noel-Baker: Yes, they pay exactly the same subsidies.
  Mr. Blackburn: Without necessarily disagreeing with what the Minister has said, may I ask whether it is not plain that all members of the British Commonwealth and Empire have an absolute guarantee of territorial integrity simply because they are members of it.
  Mr. Noel-Baker: I had better not add to what I said.
  Mr. Gallacher: Will the Minister be very chary about these incitements to war, in view of the fact that it is not the Minister or his questioners who will have to do the fighting but the young lads of this country?
  Mr. Noel-Baker: I hope that the hon. Member will do all he can to deal with all those who incite to war, either to civil war or to international war. I must

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  add that it is in the overwhelming interest of those Governments to settle by peaceful means any dispute that they have. In view of what is happening in Asia it must be abundantly plain that that is true. I am sure that it is the conviction and the policy of the Pakistan Government.

  SOUTH AFRICA (CITIZENSHIP)
  Mr. Dribergasked the Secretary of State for Commonwealth Relations whether the new proposals in connection with South African citizenship, which will affect adversely the status and rights of emigrants from the United Kingdom and other British subjects in South Africa, were discussed at the recent Commonwealth Conference in London; and what representations on the subject have been, or are being made, to the South African Government by His Majesty's Government in the United Kingdom.
  Mr. P. Noel-Baker: The proposals to which my hon. Friend refers were not discussed at the recent meeting of Commonwealth Prime Ministers in London. The new South African Act lays it down that citizens of Commonwealth countries are not aliens. It grants them preferential treatment, although less than hitherto. Under the Act, a citizen of another Commonwealth country must have resided for five years in South Africa and fulfil certain other qualifications before he can be registered as a South African citizen; hitherto citizenship has been granted after two years continuous domicile. Under the existing law as it was before this Act was introduced South African citizenship was one of the qualifications for the franchise; this provision remains unaltered, and immigrants will in future, therefore, not be able to acquire the right to vote until they have been resident in the Union for five years.
  Under the Act, existing references in South African law to a British subject shall be deemed to be references to a South African citizen, a citizen of a Commonwealth country or a citizen of Eire; thus the rights and status of British subjects are not altered, except in so far as these rights are dependent on the possession of South African citizenship in which case the acquisition of rights is delayed.
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  My hon. Friend recognises, I am sure, that every Member of the Commonwealth is free to lay down the conditions on which citizenship of their countries may be acquired and retained. The new South African Act does not recognise a common status of British subject or Commonwealth citizen; otherwise its provisions are broadly in accord with the recommendations which resulted from the discussions with officials representing Commonwealth Governments in 1947. This being so, His Majesty's Government in the United Kingdom have not thought it desirable to make any representations to the Government of South Africa about the Act.
  Mr. Driberg: Would my right hon. Friend say what are the certain other qualifications to which he has referred as being required of immigrants, other than the residence qualification? Could he also say whether this would not be an obvious opportunity for making further representations to the South Africans about their hierarchical racial policy, of which this is just one illustration, and which is an embarrassment and disgrace to the whole Commonwealth?
  Mr. Noel-Baker: On the latter part of the supplementary question I am afraid that I could not follow the hon. Member. On the first part of his question, if he will look at the published reports of the Act, he will see what it contains.

  TRADE AND COMMERCE

    Export Orders
    Mr. Osborneasked the President of the Board of Trade, to what extent, and in what industries, in order to secure export orders for British manufacturers, he has so fixed prices for home sales that goods can be sold abroad at or below cost of production, and the foreign buyer be subsidised by the home consumer.
    The President of the Board of Trade (Mr. Harold Wilson): None, Sir.
    Mr. Osborne: Is it the policy of the Government that exports, especially to dollar markets, should be sold at prices lower than prices which obtain at home?
    Mr. Wilson: I think it is the policy of everyone here that exports should be sold at reasonable competitive prices but I

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    would not like to dogmatise about what those prices might be in relation to home prices.

    Raw Cotton
    Mr. De la Bèreasked the President of the Board of Trade, whether, in view of the fact that the Government are trading in yarn and raw cotton, he can state the result by way of profit and loss for the period June 1948 to June 1949.
    Mr. H. Wilson: Government trading in raw cotton ceased on 1st January, 1948, when the Raw Cotton Commission (set up under the Cotton (Centralised Buying) Act 1947) commenced to operate. The Board of Trade do not sell cotton yarn.
    Mr. De la Bère: Can we have an assurance that the Government are not likely to re-undertake this dealing in cotton, in view of the disastrous results?
    Mr. Wilson: The hon. Gentleman does not know the facts. There is no question of re-undertaking things that we have never done. So far as our cotton buying is concerned there is no question of the Government taking it over because that is effectively looked after by the Raw Cotton Commission.

    Woollen Cloth (Imports)
    Mr. Piratinasked the President of the Board of Trade what was the quantity and value of woollen cloth imported from Italy during the past year; how did the prices compare with English manufactured cloth; and how did these imports help to implement his policy of increasing our own output of textiles.
    Mr. H. Wilson: Imports of wool cloth from Italy in 1948 amounted to 4,673,000 square yards, the value of which was £2,743,660. It is not possible to compare prices of the very wide ranges of cloths involved. These imports have not affected the expansion of our own production of wool textiles which is limited by shortage of labour.
    Mr. Piratin: Would the Minister assure the House that these imports from Italy will cease as soon as it is estimated that there are sufficient materials to supply the manufacturers? Is he further aware that the manufacturers complain that they have to pay at the rate of 1s. 8d. more per yard for this cloth and that they receive no benefit from the ceiling price?
    Mr. Wilson: The facts are not as stated by the hon. Member. The prices of certain of these cloths and certainly of others are lower than home market prices. I cannot give the assurance for which he has asked.
    Major Tufton Beamish: Is the Minister aware that a number of firms have been exporting woollen cloth to Italy to meet their export programme and are reimporting into this country the same cloth made up into suits? Is that a good example of Socialist planning?
    Mr. Wilson: No, Sir, it is not done by Socialist planning but by individual firms. I was not aware of the fact stated by the hon. and gallant Gentleman and if he will let me have the details I shall be glad to look into them.

    Paper Salvage
    Mr. Symondsasked the President of the Board of Trade what revised instructions he has sent to local authorities about paper salvage.
    Mr. H. Wilson: Owing to a combination of circumstances, the supply of mixed waste paper, which is the grade normally collected by local authorities, is at present somewhat in excess of demand and local authorities in certain areas are finding difficulty in disposing of the whole of their collections. I have accordingly decided to withdraw the directions to collect and segregate waste paper served on local authorities in 1940 under the Defence Regulations, and to let supply and demand find their own level. Local authorities have just been informed of this decision and the necessary statutory instruments are being prepared. The statutory scale of maximum prices for waste paper will however remain.
    I should like to pay a tribute to the magnificent work done on paper salvage by local authorities during the war and subsequently, and to appeal to them and to the general public not to regard the removal of the compulsory salvage regulations as any indication that paper salvage is no longer required. The surplus of mixed waste over demand is not large, and in the case of other grades of waste demand is barely met. It is abundantly clear that we cannot afford to dispense with this essential contribution which waste paper makes to our national economy.
    Mr. Symonds: Can my right hon. Friend take some further steps to make it clear that paper salvage is still necessary, as some local authorities have the impression that it is no longer necessary at all?
    Mr. Wilson: As I have tried to make clear, we still need paper salvage in general, and especially in particular grades. The situation in regard to mixed waste has become very much easier in recent months.
    Sir Ian Fraser: Would the Minister say how the law of supply and demand can operate if prices remain fixed under a control?
    Mr. John Paton: Could my right hon. Friend say whether imported waste paper of similar type to the salvage, has played a part in creating the surplus?
    Mr. Wilson: My impression is that it has not, but perhaps my hon. Friend would put a Question down.
    Mr. Skeffington-Lodgeasked the President of the Board of Trade whether he will furnish figures showing the recent progress of the paper salvage campaign.
    Mr. H. Wilson: During the first five month of 1949, the receipts of waste paper by board and paper mills have averaged 71,400 tons a month as compared with nearly 63,000 tons a month in 1948.
    Mr. Symonds: Can my right hon. Friend say if this increase in the available supplies of paper waste is a result of the campaign carried on by the football pools promoters?
    Mr. Wilson: I have no doubt that it will help. The figures I gave were for the first five months of 1949, and that is a little early for it to take effect.

    Wool Textiles (Development Council)
    Mr. Granville Sharpasked the President of the Board of Trade in what main ways the compromise proposals suggested by Sir Richard Hopkins for a development council for the wool textile industry differed from those submitted by the employers' delegation; and what are the main additional benefits expected from a statutory, as opposed to a voluntary, central body for the industry.
    Mr. H. Wilson: In an effort to meet the views of the employers' delegation,
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    Sir Richard Hopkins proposed a Development Council with the functions of promoting research, exports and design and of administering a statutory levy in connection with these purposes. He also proposed a non-statutory body to advise on all the other matters reviewed by the Wool Working Party. The Wool Textile Delegation proposed that there should be a non-statutory body for all these purposes and that the Board of Trade should be responsible for the collection of a statutory levy for the promotion of research, exports and design. As regards the second part of the Question, a statutory central body has, in my view, the advantages of being consistent with the machinery which Parliament has provided for this purpose, of ensuring greater continuity and security in the provision of funds for all required purposes and greater flexibility in their administration and use and, generally, of ensuring that the recommendations of the Wool Working Party's Report can be more fully secured both now and in the future.
    Mr. Sharp: Has my right hon. Friend received a letter from the Chairman of the wool textile delegation sending him a copy of the resolution passed by the wool textile trade associations on 16th June in which, among other things, deep resentment was expressed at the fact that no reasoned justification had been given by my right hon. Friend for his decision to establish a development council; and can he say whether that statement is correct?
    Mr. Wilson: I have spent what seemed to me to be the best hours of my life in the last two years explaining to the wool employers why a development council is desirable for the industry. If they still feel that they have had no reasoned statement, I trust they will wait until the matter is debated in the House.
    Mr. Walter Fletcher: Can the right hon. Gentleman dispel the impression which is gaining ground that he is always going to be against voluntary organisation and in favour of statutory organisation?
    Mr. Wilson: I do not know how such an impression could get round. We have agreed to a number of voluntary organisations, but I am not prepared in every case to bow to the wishes of the

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    employers and say that there shall not be a development council in a certain industry.

    Timber Control (Trading Profit)
    Mr. John E. Haireasked the President of the Board of Trade if he will make a detailed statement on the £9 million profit made by Timber Control last year.
    Mr. H. Wilson: The trading accounts of the Timber Control for the year ended 31st March, 1949, are not yet available. The profit made by the Control on its trading for the year 1947–48 amounted to £3,901,744 on a sales turnover of £123,540,200. The Profit and Loss Account is published in detail in the volume of Trading Accounts and Balance Sheets, 1947–48. (House of Commons paper No. 49 of 1948–49.)
    Mr. Haire: While I congratulate my right hon. Friend on being in charge of a Department which makes a handsome profit—reported in trade circles to be £9 million—will he, nevertheless, consider taking advantage of this profit to advise the Timber Control to bring down the cost of timber so that the benefit can be passed on to the consumers in the form, for example, of cheaper furniture?
    Mr. Wilson: The figure of £9 million to which my hon. Friend refers, relates purely to actual cash payments and receipts during the year, irrespective of the period for which they are due, and takes no account of the value of stocks or charges for which there is no cash basis. The correct figure for profit is £3.9 million.
    Captain Crookshank: Do these profits come within the category "frightfully high" which were deprecated by the Chancellor of the Exchequer?
    Mr. Wilson: I do not think they are unduly high, all things considered.

    Washing Machines (Imports)
    Mr. Dribergasked the President of the Board of Trade if he is aware that Messrs. Gamage of London are offering for sale electric washing machines, made in the United States of America, at £49 10s. each; how many such articles have been imported under licence at a
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    cost of how many dollars; and why this expenditure of dollars was authorised.
    Mr. H. Wilson: Yes, Sir. Licences have been granted during the last four years for the import from the United States of 735 domestic electrically-operated washing machines, for sale on the home market, at a total cost of 69,000 dollars c.i.f. The machines are imported under the token import arrangements of which the House is aware.
    Mr. Driberg: While appreciating the point about token arrangements, may I ask my right hon. Friend how many such token imports there are, and do they not add up to quite a substantial sum altogether?
    Mr. Wilson: Yes, Sir. It is difficult to justify any one of these individual imports. If my hon. Friend will put down a question about the token import system generally, I shall be glad to give him an answer.
    Mr. Beswick: Does the whole of the token import go to one firm, and whose responsibility is it to make application for the token import?
    Mr. Wilson: I shall be glad if my hon. Friend will put that question down.
    Mr. Skeffington-Lodge: Is there not a risk that our own manufacturers might ultimately be adversely affected by reason of these token imports being allowed to continue?
    Mr. Wilson: No, Sir. I do not think it is having that effect at all.

    Books, South Africa
    Mr. Wilson Harrisasked the President of the Board of Trade if he will make a statement on the restrictions imposed by the Government of the Union of South Africa on the importation of books published in this country; and what representations he has made in this matter.
    Mr. H. Wilson: The South African authorities have announced that they will permit recognised libraries in the Union to import all books freely. Other importers may import scientific, technical and educational books freely, but their imports of other non-fictional books will be reduced to 80 per cent. and imports of fictional books to 50 per cent. of their

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    imports in 1948. I do not propose to make any representations to the South African authorities about these restrictions. They cannot be regarded as unexpected having regard to South Africa's balance of payments difficulties.
    Mr. Wilson Harris: Does the right hon. Gentleman realise that very different statements have been published about this? Does he agree that this is very much better than had been feared?
    Mr. Wilson: I hope that my answer will put the facts in their true light.
    Mr. Emrys Hughes: Is it not true that there is a ban on the import into South Africa of gramophone records of the songs of Mr. Paul Robeson, so that the majority of the people in South Africa cannot hear their own songs? Will my right hon. Friend make representations about this?
    Mr. Wilson: That is an entirely different question.

    National Research Development Corporation
    Mr. Blackburnasked the President of the Board of Trade whether he is yet in a position to announce the members of the National Research Development Corporation.
    Colonel J. R. H. Hutchisonasked the President of the Board of Trade what appointments have now been made to the National Research Development Corporation.
    Mr. H. Wilson: I am glad to be able to say that Sir Percy Mills has accepted my invitation to become Chairman of the Corporation. I have also appointed five other Directors, whose names I will circulate in the OFFICIAL REPORT. I announced the prospective appointment of the Managing Director, Lord Halsbury, in reply to a Question by my hon. Friend, the Member for King's Norton (Mr. Blackburn) on 10th May. The Corporation accordingly came into existence on 28th June, and I am sure that hon. Members will join with me in wishing it every success in the very important work it has to do.
    Mr. Blackburn: Will my right hon. Friend make sure that the address of the Corporation is made known as soon as
    1502
    possible so that the many inventors who are writing to Members of Parliament and the Committee may know where to send their applications?
    Mr. Wilson: Yes, Sir, I will see to that.
    Mr. Tolley: May I ask what are the terms of reference of the Committee, as I regard them as important?
    Mr. Wilson: If my hon. Friend will study the Act passed last year he will find them fully set out.
    Following are the names of the other Directors:
    Professor Patrick Maynard Stuart Blackett, F.R.S., M.A.
    Sir John Duncanson.
    Sir Edward Hodgson, K.B.E., C.B.
    Mr. W. E. P. Johnson, A.F.C., C.P.A., A.F.R.Ae.S.
    Sir Edward de Stein.

  DISPLACED PERSONS (ACADEMIC APPOINTMENTS)
  Mr. Julius Silvermanasked the Secretary of State for the Home Department what steps are taken under the authority of his Department to screen displaced persons who are admitted into this country for the purpose of taking up academic appointments.
  The Secretary of State for the Home Department (Mr. Ede): Displaced persons admitted to the United Kingdom to take academic appointments had been accepted for resettlement and maintenance by the International Refugee Organisation, who in each case had satisfied themselves that the person's record contained no authenticated charges of collaboration. In addition they were screened by the British Security Service in Germany. In these circumstances no steps were taken by the Home Office to exercise more than the usual check on entry.
  Mr. Silverman: May I take it that none of the organisations carrying out screening operations is under the control of the Home Office?
  Mr. Ede: The British Security Service is not under the control of the Home Office, but we work in the closest collaboration with it.
  Mr. J. Silvermanasked the Secretary of State for the Home Department under what circumstances E. Zakevicius, recently at Birmingham University, was admitted into this country; and whether it was known at the time of his admission that he had in 1941 accepted office as mayor of Vilnius under the German Army authorities and collaborated with them in their repressive measures especially against the Jews and Poles in that city.
  Mr. Ede: Professor Zymantis-Zakevicius was one of a small group of displaced persons with high academic qualifications selected by representatives of United Kingdom universities for suitable academic appointments in the United Kingdom, and he was admitted to this country in May, 1948. The allegations against him to which my hon. Friend refers were made in a Soviet-controlled Lithuanian newspaper in November, 1948, and by the Soviet-controlled Radio Vilna in December, 1948, but I am not aware of any foundation for them.
  Mr. Silverman: Is it not a fact that this man was the mayor of Vilnius under the German occupying authority after they took control, because that has been admitted to me by the Foreign Office?
  Mr. Ede: I think he did hold that appointment.
  Mr. Silverman: Does not that amount to a prima facie case of collaboration which ought to be examined?
  Mr. Ede: No, the case was investigated and I have every reason to believe that this man is thoroughly satisfactory.

  INDIA (BRITISH CITIZENSHIP)
  Mr. A. R. W. Lowasked the Secretary of State for the Home Department how much it costs British subjects born in India to establish their United Kingdom citizenship.
  Mr. Ede: I assume that the hon. Member refers to the cost incurred by a person born in India who applies to me for registration as a citizen of the United Kingdom and Colonies. A fee of 10s. is charged for registration, a fee of 2s 6d. is payable to the justice of the
  1504
  peace or commissioner by whom the signing of the application is witnessed, and the form of application costs 4d.
  Mr. Low: Is not this a large and unnecessary sum to impose on people who are forced as a result of a change in legislation by Parliament to apply for United Kingdom citizenship, which it was quite unnecessary for them to do until 1948?
  Mr. Ede: Yes, Sir, I am inclined to think that the charge may be high and I am personally re-examining it.
  Mr. Henry Usborne: Has the right to their passport now to be re-established by people born in India who for several years have held a United Kingdom passport?
  Mr. Ede: Not in every case.
  Captain Marsden: Is it necessary for Members of Parliament to apply? I was born in India. Do I really have to apply to be told that I am a British citizen?
  Mr. Ede: I should think not.

  NATIONAL HEALTH SERVICE

    Hospital Estimates
    Sir Ian Fraserasked the Minister of Health whether he has considered representations from hospital management committees about the cut in the hospital estimates; and whether he is satisfied that the reductions can be made without detriment to the interests of patients.
    The Minister of Health (Mr. Aneurin Bevan): I have considered representations from hospital authorities about the cut in their estimates and have again made it clear that I do not desire economies to be made which would be detrimental to the interests of patients. Fresh instructions have been issued as to the basis on which the estimates for the current year should be prepared.
    Sir I. Fraser: To what extent have the estimated economies been effected or are they likely to be effected?
    Mr. Bevan: It is too early for me to tell that yet. I would remind the House that owing to the relationship between

    1505
    the beginning of the financial year and the time when the estimates have to be prepared by the hospital boards, they will actually have to prepare two sets of estimates without having a full year's experience behind them.
    Mr. K. Lindsay: Does my right hon. Friend believe that it is possible to make these cuts at all without detriment to the interests of the patients?
    Mr. Bevan: Then obviously the cuts cannot be made.
    Sir Hugh Lucas-Toothasked the Minister of Health what are the total amounts of the excess authorised in excess of the Estimates for the current year in the case of the teaching hospitals and the other hospitals, respectively; whether such excess expenditure has been reported to the Treasury in accordance with Treasury Circular No. 2/49; and what measures have been proposed in accordance with the terms of that circular in order to avoid a Supplementary Estimate.
    Mr. Bevan: No approvals have yet been issued covering the maintenance expenditure of the teaching and other hospitals for the current year as I am awaiting the submission of revised estimates on the basis that there must be no closing of beds or reduction of other services essential to the care and welfare of patients. The Government expect that the revised estimates for maintenance expenditure will exceed the provision in the Estimates for this particular item. In reply to the last part of the Question, regional hospital boards and the boards of governors of teaching hospitals have been asked to exercise close financial vigilance in preparing their revised estimates and to budget only for services which they are satisfied must be brought into operation this year.
    Sir H. Lucas-Tooth: Does that answer mean that the right hon. Gentleman has decided that there will be a Supplementary Estimate in this connection?
    Mr. Bevan: I actually indicated in the earliest Debate on the Estimates that there obviously would be a Supplementary Estimate this year if there was an increase in the salaries of the nurses.

    Chartered Accountants (Forms)
    Mr. Gerald Williamsasked the Minister of Health if the forms required
    1506
    to be filled in by chartered accountants claiming for money owed for services rendered to hospitals have now been printed and distributed.
    Mr. Bevan: Yes, Sir.

    Prisoners (Dentures and Spectacles)
    Major Guy Lloydasked the Minister of Health what instructions his Department has given regarding priority for the provision of dentures and spectacles to persons in prison; and why it takes less time for a prisoner to be supplied than the rest of the community.
    Mr. Bevan: None, Sir. Prisoners are in general dealt with under the same arrangements as apply to other persons.
    Major Lloyd: Can the right hon. Gentleman account for the fact that at the annual conference of the Prison Officers' Association in Bristol the other day, speaker after speaker said from personal experience that prisoners had an overwhelming advantage in the delivery of spectacles and dentures, not only over the prison officers themselves, but over their friends and relatives and others of the community?
    Mr. Bevan: There may be instances where prisoners would be able to get dentures ahead of some other members of the population. However, I will inquire to see whether the system of priorities is working in that way.

    Consultant's Fee, Middlesex
    Mr. Gammansasked the Minister of Health what fee may be offered in the county of Middlesex to a specialist who, in the opinion of a senior medical officer of a hospital should be called in to advise on a difficult case.
    Mr. Bevan: A consultant called in exceptionally to a hospital administered by a board with whom he has no contract may be paid a fee of five guineas and travelling expenses.
    Mr. Gammans: Would the right hon. Gentleman say if any representations have been made to him that the fee now permissible is considerably less than what was paid when these hospitals came under the Middlesex County Council, and for that reason it is not easy to persuade specialists to take up this work?
    Mr. Bevan: No. As a general rule there are sufficient experienced consultants attached to the Board without having to go outside, and no difficulty is experienced in getting consultants from outside.

    Dental Technicians
    Mr. Norman Bowerasked the Minister of Health if he is aware that the United Dental Technicians' Association is desirous of becoming a professional body whose members will be qualified to take impressions, make dentures and supply them to the public without the intervention of a dentist; and if he will introduce legislation for this purpose.
    Mr. Bevan: I am aware of the proposals of this body but I am not prepared to introduce legislation on the lines suggested.
    Mr. Bower: Is the Minister aware that it has been computed that if this were done, the cost of dentures would be reduced from £10 10s. to £7 15s., and is not that a matter which is worthy of careful consideration?
    Mr. Bevan: I am not convinced that the standards of dentistry would be maintained. Of course, we can reduce the cost of dentistry if we reduce the quality of the dentures.

  AGRICULTURE

    Sheep Dipping (Regulations)
    Mr. Hurdasked the Minister of Agriculture if his Department has tested the effectiveness and economy of spraying sheep with D.D.T. and similar preparations compared with using arsenical dips as a means of destroying parasites and preventing scab infection; and if he intends to amend the sheep dipping regulations to take account of new knowledge.
    The Minister of Agriculture (Mr. Thomas Williams): I am advised that D.D.T. is not effective against sheep scab and that under farm conditions spraying, even with preparations that are effective, would not normally give such good control as dipping. The regulations (which relate only to sheep scab) have been amended to permit single dipping (in place of double dipping) with dips containing certain of the new preparations, but I do not propose to amend them to permit spraying.

    Crown Lands, Windsor (Timber Sales)
    Mr. Mott-Radclyffeasked the Minister of Agriculture the total value of timber sold for telegraph poles and for pit props, respectively, from the afforested area owned by the Commissioners of Crown Lands or the Forestry Commission, in the Bracknell, Crowthorne, Camberly, Bagshot and Ascot districts since 1945.
    Mr. T. Williams: In the four years ended 31st December, 1948, the value of timber sold for telegraph poles from the Crown Lands Windsor Estate was £18,475. In addition, timber worth £30,746 was sold to various merchants and some of this may have been used for pit props. Between May, 1947, and May, 1949, the Forestry Commission sold about £5,000 worth of timber for pit props from the Crowthorne district.
    Mr. Scollan: Do these figures include Scottish sales?
    Mr. Williams: No, Sir.

    Grassland
    Mr. Philips Priceasked the Minister of Agriculture whether, in view of the Report issued by the Committee on Industrial Productivity suggesting that a 20 per cent. increase in meat production in this country could be obtained within the next four years if our grassland were developed by means of improved management and more intensive application of fertilisers, he will state what steps are to be taken to achieve that objective.
    Mr. T. Williams: I assume that my hon. Friend intends to refer to the possible increase of 20 per cent. in the total yield of the grassland in this country, mentioned in paragraph 62 of the First Report of the Committee on Industrial Productivity (Cmd. 76665). As stated in the report, this was a recommendation of the Imports Substitution Panel which has been accepted as a basis for Government policy; and such an increase in yield is the aim of the Grassland Development Campaign initiated in January, 1948.
    Mr. Philips Price: Will my right hon. Friend bear in mind the great difference between the prices of store stock, which are high, and finished cattle which are relatively low, and will he take steps to

    1509
    see that the policy increases the number of store cattle in the country in order to bring the price of store cattle down?
    Mr. Williams: I am not at all sure that the price of the finished cattle is low.
    Mr. Hurdasked the Minister of Agriculture, if he has considered the view of the county agricultural executive committees on the effects of the proposed withdrawal of the grant paid on grassland ploughed for tillage cropping; and what action he proposes to take in this matter.
    Mr. T. Williams: Yes, Sir. A number of agricultural executive committees have discussed with me the forthcoming cessation of the ploughing up grant. The Emergency (War Provisions) Act, 1947, only authorises continuance of the grant on land that is ploughed up to 31st December, 1949, and I hope that farmers will take full advantage of it in the time that remains by ploughing up the maximum amount of grassland, especially the less productive permanent pasture.
    Mr. Hurd: Yes, but as the Minister has asked farmers to maintain and increase the tillage acreage up to 1951–1952, is it really wise to remove entirely the ploughing grant? Would it not be better to reduce it to £2 an acre under permanent grass?
    Mr. Williams: That perhaps is arguable. Anyhow, as the hon. Member knows, we are recommending the ploughing up of old grassland as good farming practice, and there is not a good case that can he made out for making a grant where we know it to be good farming practice.
    Major Sir Thomas Dugdale: Will the Minister again seek the advice of the county executive committees on this point, because if we are to get the best people available on the county committees they must feel that the Minister will seek their advice on matters such as this?
    Mr. Williams: I can assure the hon. and gallant Member that I never fail to consult my county agricultural committees on matters of this kind.
    Mr. Snadden: Can the Minister say if the possible removal of this assistance will apply to the United Kingdom as a whole or only to England and Wales?
    Mr. Williams: To the United Kingdom, as far as I understand it.

    Farm Land, Berkshire
    Mr. Hurdasked the Minister of Agriculture, if he has now decided to seek the advice of county agricultural executive committes before agreeing to the alienation of farm land for new towns or other non-agricultural development; and if he will consult the Berkshire County Agricultural Executive Committee about the proposed development at Thatcham.
    Mr. T. Williams: County agricultural executive committees will be consulted in future on development proposals involving substantial areas of agricultural land. If the proposal for developments at Thatcham matures, the Berkshire Committee will be consulted under this arrangement before any decision is taken.
    Mr. Hurd: Could the Minister say what reason induced him to abandon consultations with committees during the past three months?
    Mr. Williams: I am not at all sure that we did abandon consultations with committees, except in the case of small bits of land here and there, where there is no necessity to consult county committees.
    Mr. Emrys Roberts: Does the Minister's reply indicate that county agricultural executive committees will now be consulted in all proposals for afforestation?
    Mr. Williams: If it is a question of the diversion of a large area of land county executive committees will be consulted.

    Pigs
    Mr. Thomas Reidasked the Minister of Agriculture the number of pigs in Britain now.
    Mr. T. Williams: The number of pigs in Great Britain on 4th March, 1949, as returned by occupiers of agricultural holdings exceeding one acre, was 2,295,000. The figure for June, 1947, was 1,294,000.
    Mr. Reid: Is it not a fact, therefore, that there has been a great increase in the pig population since the end of the war—take, for instance, the 1946 figures

    1511
    —and will my right hon. Friend say how he has managed to get sufficient food to feed these pigs?
    Mr. Williams: We have had to obtain food in all parts of the world and get whatever we could.

    Fowl Pest, Bedfordshire
    Mr. Skeffington-Lodgeasked the Minister of Agriculture, in view of the prevalence of fowl pest in parts of Bedfordshire, what steps he is taking to deal with the outbreak and to stop its spreading; how many birds have so far been destroyed; and what plans are in hand to compensate poultry owners who may be affected.
    Mr. T. Williams: Most of the recent outbreaks of fowl pest in Bedfordshire have resulted from the sending of infected birds to certain markets. My inspectors are trying to trace all the birds that have been exposed to infection and, as these birds are traced, restrictions are imposed to prevent further contacts. All birds on premises where fowl pest occurs are slaughtered. About 1,450 birds have been slaughtered, and compensation is being paid to the owners of all birds not affected with fowl pest which have been slaughtered by direction of my Department.
    Mr. Skeffington-Lodge: Can my right hon. Friend confirm that in some cases people selling poultry give false names and addresses; and, if that is so, is there any means of stopping this practice, which is leading to the spread of this disease?
    Mr. Williams: I could not confirm that rumour but if any information is brought to my notice I will gladly have it looked into.

    Exmoor Survey
    Mr. Collinsasked the Minister of Agriculture if he has now considered the Exmoor Survey carried out by the Agricultural Economics Department of the University of Bristol; and what proposals he has which will assist marginal land farmers in this and similar areas to achieve the promise of substantial increase in the production of beef cattle and sheep, indicated in the report.
    Mr. T. Williams: Yes, Sir. I have considered this Survey, which makes a valuable contribution towards the general
    1512
    problem of increasing production from the marginal areas of this country. My hon. Friend will remember that on 24th January last I announced an extension of the Marginal Production Scheme which is designed to assist farmers in areas such as Exmoor.
    Mr. Collins: Is my right hon. Friend aware that the provisions contained in his announcement in January are quite inadequate for tackling this very large and important task, and will he look into the matter again and submit proposals in accordance with the needs of the situation?
    Mr. Williams: I can assure my hon. Friend that the question of marginal land is under almost continuous consideration.

    Dunster Castle Estate (Lease)
    Mr. Collinsasked the Minister of Agriculture why the Forestry Commission have leased some 1,200 acres of land on the Dunster Castle Estate in the Quantock Hills, in view of the fact that this is a proposed national park area.
    Mr. T. Williams: The Forestry Commission are negotiating this lease because the land is eminently suitable for timber production, which is an urgent national requirement. The fact that land is within a proposed national park should not preclude the use of suitable areas for the growing of trees.
    Mr. Collins: Is my right hon. Friend aware that this land is already bearing a great deal of timber far more valuable than the conifers which the Forestry Commission would plant, and will he look again into this question in view of the great concern which exists in the neighbourhood and the likelihood of causing damage to the rights of the commoners there?
    Mr. Williams: My information is that the land referred to contains mainly small coppices of an inferior nature which are overgrown and, therefore, are pretty useless.
    Earl Winterton: In justice to the Forestry Commission, can the right hon. Gentleman make it clear that in all these forests which are open to the public under proper precautions, many people find the young trees not only attractive in

    1513
    themselves but a valuable future source of profit to the country?
    Mr. Williams: I could not agree more with the noble Lord. A walk through any of the adjacent woodlands of the Forestry Commission, in which planting began in 1922, will show that the Commission's woods have considerable beauty.

    German Students (Interchange)
    Mr. Symondsasked the Minister of Agriculture if he will extend to Germany the provisions of the scheme already operating with other European countries for the interchange of agricultural student employees.
    Mr. T. Williams: I hope that as time goes on it will be possible to extend the list of European countries taking part in this useful scheme and I would certainly not exclude the possibility of its extension to Germany. For the time being, however, our general policy is to concentrate on building up the number of exchanges with the countries already included in the scheme.
    Mr. Symonds: Is my right hon. Friend aware that an over-rigid interpretation of this rule is resulting in the exclusion from this country of a young student, whose family has an excellent anti-Nazi record, who wants to come to this country for a limited period of one year before emigrating to our Colonies, and will my right hon. Friend please do something to try to allow this young man to come here as he desires.
    Mr. Williams: I could not by means of question and answer lead with an individual case of that description. The Question refers to the general situation of German students.

    Advisory Service (Ex-Service Men)
    Mr. Baker-Whiteasked the Minister of Agriculture whether he is aware that the withdrawal of age and pay concessions to ex-Service men entering the National Agricultural Advisory Service in the grade of assistant experimental officer acts adversely against them in that for the great majority of ex-Service men the years 1949 and 1950 are the first possible opportunities of entering the service after graduation; and
    1514
    whether he is prepared to restore for these two years the concessions to ex-Service entrants.
    Mr. T. Williams: Assistant experimental officers are not employed in the National Agricultural Advisory Service, but I assume the hon. Member is referring to officers in Grade IV of that service. The "weight-for-age" salary concessions in this grade was an exceptional arrangement to meet the post-war situation. As in comparable grades throughout the Civil Service it has now been replaced by an increment for each year of military service under the National Service Act up to two years. There is no age limit to entry into the Advisory Service.

    Footpath, Bedfordshire
    Mr. Skeffington-Lodgeasked the Minister of Agriculture whether he will take steps to recover the right of way between Turvey Abbey and Turvey Priory, Bedfordshire, this footpath having been obliterated as a result of war-time agricultural activity.
    Mr. T. Williams: The local authority is the body primarily responsible for the protection of public rights of way. When the relevant Defence Regulation which authorised the ploughing up of footpaths was revoked in 1945, local authorities were duly informed and at the same time farmers were told that they should restore the footpaths that previously existed.
    Mr. Skeffington-Lodge: Am I, then, to blame the local authority for the present state of affairs?
    Mr. Williams: My Department have no responsibility for the preservation of footpaths.
    Mr. Skeffington-Lodge: Why, therefore, did my right hon. Friend undertake the responsibility of answering this Question when it was directed originally to the Minister of Town and Country Planning?
    Mr. Williams: Because the Minister of Town and Country Planning preferred me to answer it rather than to do so himself.
    Mr. Skeffington-Lodge: That is no answer to my question.

  NATIONAL FINANCE

    Marshall Aid
    Mr. Errollasked the Chancellor of the Exchequer what steps he has taken to ensure that the British public is kept fully informed of the extent and amount of American help provided by Marshall Aid.
    The Economic Secretary to the Treasury (Mr. Douglas Jay): An account of the machinery by which His Majesty's Government makes available information about help received under the European Recovery Programme is contained in the Third Report on Operations under the agreement between the Governments of the United Kingdom and the United States of America (Command No. 7702). I would also refer the hon. Member to the reply which my right hon. and learned Friend the Chancellor gave to the hon. Member for Hornsey (Mr. Gammans) on 22nd March. Ministers and the official information services are constantly emphasising the significance of Marshall Aid for our prospect of national recovery. I would like to draw attention to the opportunity existing for non-official sources of public information to draw on the wealth of material which the Government make available.
    Mr. Erroll: While paying tribute to the degree to which Members of the Opposition refer to the extent of Marshall Aid, may I ask Members of the Government if they would be prepared to drop their arrogant attitude towards Marshall Aid and give full credit where credit is due?
    Mr. Jay: As the hon. Member knows, Members of the Government have constantly paid tribute to Marshall Aid in all their speeches. I have always inserted a passage to that effect in my own speeches but I notice that the newspapers appear to have heard it so often that they usually leave it out of their reports.
    Mr. Errollasked the Chancellor of the Exchequer if he will take steps to ensure that the British public is made aware of the extent of the contribution made by the average American family to the cost of Marshall Aid for Europe.
    Mr. Jay: The E.R.P. Information Office and other branches of the official information services lose no opportunity
    1516
    of reminding people in this country that American aid is paid for by American taxpayers. Among recent instances, a poster widely distributed for use in factories contained the statement that
    "It cost every American £7 15s. 0d. last year to help Britain and Western Europe."
    Mr. Erroll: In addition to the information already given, could the hon. Gentleman make it clear that the average contribution to this country by each American family is of the order of £30 a year?
    Mr. Jay: That is approximately correct but I think that we have done more to give information to our own people about the aid we have received from the United States, than, perhaps, have some of the other countries to whom we have given aid, to make it known to their people.
    Mr. Gallacher: Would the Economic Secretary make clear to the American people the enormous contribution which the British people are making to American profits through dollar payments and excessive prices and that this amounts to more than £30 per family per year? Hon. Gentlemen opposite should realise this.
    Mr. Fernyhough: Does not my hon. Friend agree that no country in the world on a per capita basis has helped other nations more than has this nation?
    Mr. Jay: That is certainly true.

    Economic Situation (Information)
    Mr. Osborneasked the Chancellor of the Exchequer, in view of the fact that the difficulties of the present economic position do not present themselves in an obvious form to the British public as stated in Command Paper No. 7572, paragraph 30, which was issued six months ago, what new steps he proposes to take to bring home the realisation of our serious economic situation to the public mind.
    Mr. Jay: Since the issue, six months ago, of the White Paper to which the hon. Member refers, there have been a number of statements, e.g., the Economic Survey, the Budget speech of my right hon. and learned Friend, and more recent speeches by him and other members of the Government, in which the facts of the economic situation have been repeatedly

    1517
    brought out. I have no doubt that my right hon. and learned Friend will, before long, take an opportunity of giving further information to the House.
    Mr. Osborne: Is the Minister satisfied that everything that could be done is being done by Government propaganda to bring home the seriousness of our economic situation to the ordinary man in the street and, if this is being done, why are we having so many unofficial strikes?
    Mr. Jay: I think more has been done by this Government than any previous Government in that regard.
    Mr. David Renton: Would the hon. Gentleman ask his colleagues to give the facts in the most naked form possible, instead of having them smeared over with the soft soap of Socialism?
    Mr. Jay: My right hon. and learned Friend the Chancellor said only 10 days ago that the dollar situation was deteriorating. I think the facts could not be more bluntly given than that.

  WATER SUPPLY, LONDON
  The following Question stood upon the Order Paper in the name of Sir RALPH GLYN:
  69. To ask the Minister of Health if his attention has been drawn to the present rate of flow of the Thames over Teddington Weir; whether it is intended to take any steps to restrict the consumption of water in the metropolitan area; what is the average daily and weekly consumption; and how these figures compare with 1937.
  At the end of Questions—
  Mr. Bevan: With your permission, Mr. Speaker, and the permission of the House, I would like to answer Question No. 69.
  Yes, Sir. The position calls for economy and I understand that the Board propose restrictions at an early date if the present dry weather continues. The average daily consumption in the Board's area of supply for the year ending 31st March, 1949, was 323 million gallons as compared with 306 million gallons for the year ending 31st March, 1938. Figures of average weekly consumption are not separately available.
  Sir R. Glyn: Do the figures quoted by the right hon. Gentleman mean that the flow of the Thames today is less than half the normal flow at this time of the year and, as a result of that, do the Metropolitan Water Board propose restrictions on the consumption of water in London? May I ask whether the right hon. Gentleman will consider imposing restrictions on people bathing in the tidal waters owing to the inadequacy of the flushing from fresh water to prevent the flow of sewage up and down the Thames on the tide level?
  Mr. Bevan: I will certainly inquire into the practicability of doing that. Of course, it is very difficult to prevent people bathing even in dirty water in very hot weather. It would not be a very popular thing to attempt to do so. I know there are some conditions in which children ought to be prevented from bathing, especially where the water is noxious, as it is likely to become when the volume falls. There has been a very rapid fall in the flow of water over Teddington Weir and I and the Minister of Transport will make a joint Order this week enabling the Board to reduce the flow. The flow on 27th June was 290 million gallons as compared with the standard daily average for the past 35 years of 819 million gallons, so the House will begin to realise that the drought is having a very unfortunate effect on the supply of domestic water. I take the opportunity of appealing to all water users throughout the country, particularly in the London area, to exercise the utmost economy.
  Mr. Tolley: Would my right hon. Friend consider approaching the Prime Minister with a view to setting up a Royal Commission to go into the whole question of water conservation?
  Mr. Bevan: The party to which my hon. Friend and I belong have already made up their minds as to what it is necessary to do with the water supply.

  RAILWAY WORKERS (DISPUTE)
  Mr. Eden(by Private Notice) asked the Minister of Labour whether he can now make a statement about the decision

  1519
  of the N.U.R. to put into force a "go-slow" campaign on the railway at midnight on Sunday next.
  The Minister of Labour (Mr. Isaacs): Yes, Sir. I understand that, in accordance with arrangements made between the parties last week, a meeting between the Railway Executive and the railway trade unions is taking place this afternoon. I would, therefore, ask to be excused from making any fuller statement on the immediate situation which might prejudice those discussions. In view, however, of the widespread interest in this matter, it might be helpful if I recapitulated briefly the events leading up to the present situation.
  In 1947 claims were submitted by the railway trade unions to the railway companies for a £1 a week increase in wages and a reduced working week. The nationalisation of the transport industry was then imminent and, on a suggestion of the two sides of the industry, I agreed, in the special circumstances, to appoint a court of inquiry to deal with the claims. This court recommended an increase of 7s. 6d. a week for all adult workers and a reduction in the normal working week from 48 to 44 hours. The court also pointed to the need for a revision of the wages structure in the industry.
  The parties accepted the recommendations of the court and the recommendations regarding wages and hours were operated as from 30th June, 1947. Negotiations were also entered into on wages structure and revised scales for the conciliation grades were agreed to in February, 1948. It was part of this agreement that the parties accepted it as in final settlement of the recommendations of the court of inquiry.
  On 30th August, 1948, the National Union of Railwaymen submitted an application to the Railway Executive for a flat rate increase of 12s. 6d. per week which they stated they regarded as the balance of the previous claim for an increase of £1 a week. This claim was finally rejected by the Railway Staff National Tribunal in March, 1949.
  In April, the National Union of Railwaymen submitted a new claim for a flat rate addition of 10s. a week plus time-and-a-quarter for all work from 12 noon on Saturdays. In the course of
  1520
  negotiations on this claim, the Railway Executive made certain offers in respect of the lower paid grades of workers. The recent special delegate meeting of the National Union of Railwaymen rejected these offers and adopted the decision referred to in the right hon. Member's Question.
  I am sure the House will join with me in hoping that wiser counsels will prevail and the country will be spared the disturbance and dislocation of trade that must follow any widespread adoption of "go-slow" policy amongst members of the National Union of Railwaymen. Machinery is available for settling any outstanding questions with the Railway Executive and I am sure that it is in everybody's interest that it should be used.
  Mr. Eden: I am sure we all hope that this meeting this afternoon will have some good result. At the same time, I think the right hon. Gentleman will admit that there is the question of the position of the public in relation to this matter to be borne in mind. Therefore, will the Railway Executive give some guidance to the public as to what is to be the position in respect of the services we shall enjoy, so far as we shall enjoy them, should events not work satisfactorily? I suggest that the kind of situation on which the public want information is to what extent the service will continue, to what extent it will be normal, and what plans they should make about travel and the carriage of goods?
  Mr. Isaacs: I understand that such consideration is being given, and I shall certainly draw the attention of the executive to the matter. May I add that action such as is contemplated by the men will not assist negotiations. It cannot put everyone concerned in a good humour. It will lose for them the public opinion they enjoyed as running the safest railway system in the world apart from the rules which they are now going to observe. They will not only cause inconvenience to the public, but will dislocate the essential life of the community. May I, perhaps impertinently, as an old worker myself, appeal to these workers to stick to the proper way of negotiating these things. Trust the people handling this matter and let us try to get a settlement without disturbing the life of the community.
  Mr. Proctor: In view of the financial difficulties that confront the Railway Executive Committee at present, and in view of the feeling, very genuine and very widespread amongst the railwaymen, that they have a clear case for an advance in wages and that that advance of wages might be denied them on the grounds of the financial condition of the railway industry, which has arisen as a result of long years of past difficulties—[HON. MEMBERS: "Nationalisation."]—I am not suggesting that nationalisation had anything but a beneficial effect for the whole of the railwaymen—I should like to ask in view of the parties being brought together and the feeling among them that a genuine case exists whether the Government feel that they can consider the financial implications of any arrangement which might be made?
  Mr. Isaacs: The position of the Government and Minister of Labour at the moment is that of offering their services to help both sides. It would be rather difficult if we took up an attitude which expressed an opinion which one side might say was prejudicing the presentation of their case. All these things will be borne in mind, and we shall not delay any efforts which we can put forward to help the parties to reach a settlement.
  Mr. Scollan: Is there any chance of this negotiating body considering the withdrawal of these rules? This is the second time that the railwaymen have put working to rule into operation, and it is obvious that these rules are out of date and were not observed even under the old companies. Is there any chance of these rules being withdrawn and new rules which can be worked being issued?
  Mr. Isaacs: I am afraid that I cannot comment on that.
  Mr. Gallacher: In view of the serious situation that will arise if the negotiations do not succeed, and in view of the representative character of this House, could we not have a vote of this House for or against the increase of 10s. per week?
  Mr. Peter Thorneycroft: In view of the great inconvenience which will be caused to everyone this coming weekend if these negotiations this afternoon do not end satisfactorily, will the right hon.
  1522
  Gentleman consider making a statement to the House either later this evening or tomorrow?
  Mr. Isaacs: Yes, Sir. If that should be necessary and helpful, I shall not hesitate to inform the House of the situation.

BUSINESS OF THE HOUSE
Mr. Eden: May I ask the Lord President of the Council to tell us the Business for next week?
The Lord President of the Council (Mr. Herbert Morrison): Yes, Sir. The Business for next week will be as follows:
Monday, 4th July—Supply (19th allotted Day); Committee. Debate on housing in England and Wales.
Tuesday, 5th July—Supply (20th allotted Day); Committee. Debate on education in England and Wales.
Wednesday, 6th July—Report stage of the Finance Bill, being the first of two days which we propose for this stage of the Bill.
Consideration of Motions to approve Double Taxation Orders.
Thursday, 7th July—Supply (21st allotted Day); Committee. Debate on industry and employment in Scotland.
Friday, 8th July—Report and Third Readings of Private Members' Bills.
If there is time, Second Reading of the U.S.A. Veterans' Pensions (Administration) Bill [Lords] and, if agreeable to the House, the Committee and remaining stages; Report and Third Reading of the Colonial Loans Bill; and Committee and remaining stages of the Colonial Development and Welfare Bill.
Mr. Eden: Will the Lord President tell us when the Government propose to give time for a Debate on the Report issued yesterday by the Royal Commission on the Press?
Mr. Morrison: I anticipated that the House might wish to debate that report, and I think that there ought to be a Debate, because there is much to be said. [Interruption.] Let the Opposition not think that we shall be afraid of a Debate. We are ready for it, very ready, but I am afraid it cannot be this side of the Summer Recess unless a Supply Day

1523
is taken. We shall however be very willing to discuss the matter through the usual channels.
Mr. Eden: I am bound to say that the right hon. Gentleman's attitude about time is rather unreasonable. The Government found no difficulty whatever in finding time for the Motion to appoint the Commission when it was put down by hon. Members on the opposite side of the House, but if he cannot find Government time we certainly consider that this matter should be debated before the Summer Recess, and we shall be willing, but reluctant, to give a Supply Day for it.
Mr. Morrison: I am obliged to the right hon. Gentleman. We shall be there.
Mr. Thomas Brown: Arising out of the Report of the Select Committee, which was issued on 25th January last, when do the Government propose to introduce legislation to deal with compensation for mining subsidence?
Mr. Morrison: I recognise that it is an important matter, especially to hon. Members who represent mining Divisions, but we have not yet concluded our consideration of the matter, and I am afraid that we are not immediately ready to make a statement. I shall take the matter up with the Ministers concerned, however, and see what can be done about it.
Mr. Ronald Chamberlain: The Interim Report of the Committee on Leasehold Reform took the Committee 15 months to bring forward. I know it is a difficult matter, but we are now told that the Government will not announce any decision until the final report is received. Since the interim report deals with a clearly specified area of the matter, and since it is literally a matter of life and death for thousands of small businesses, will the Minister reconsider the whole matter or at least give us time to debate the interim report?
Mr. Morrison: I understand that a Question was put down about this matter, and that it was answered. I do not think that this is a matter which arises on the Business for the week.
Mr. Maclay: Is it proposed to give an opportunity at a reasonably early date for a discussion on the general economic
1524
situation? If so, will the right hon. Gentleman give the maximum possible notice of it because the subject is, to say the least, a difficult one?
Mr. Morrison: I cannot say anything about that at this moment. It may be that that question can more conveniently be put next week.
Mr. H. Hynd: Can my right hon. Friend arrange, as a matter of urgency, for the House to have an opportunity of discussing the Report on the political activities of civil servants before the rules are put into operation?
Mr. Morrison: The Chancellor has given an indication that the Government propose to accept the general purposes of the Report, and unless there were startling developments or comments about it, I think the matter might rest there. We had better see what comments are made.
Mr. Quintin Hogg: I am sorry to suggest yet another subject for debate, but will the right hon. Gentleman consider giving time for the House to consider the Report of the Royal Commission on Population?
Mr. Morrison: I will consider that, but to be quite frank, we are in difficulties about the time-table between now and the Summer Recess—we are bound to be, we cannot help that. I shall, however, keep the point in mind.
Mr. Kenneth Lindsay: I am sorry to suggest yet another subject. Is it likely or possible that we shall have a Debate on the Statute of Europe before the very important meeting at Strasbourg in August?
Mr. Morrison: I am afraid I cannot give an undertaking about that. I do not see a prospect of being able to give time for such a Debate. I thought that on the whole the House had received the announcement about the Statute and the general structure of the Council of Europe with broad satisfaction. I just do not see our being able to find a day for such a Debate between now and the Assembly.
Mr. Cobb: Could I hold one other subject before my right hon. Friend's dazzled eyes? The report of the committee on price maintenance is most important. Would it be possible to find time for a Debate on it?
Mr. Morrison: I am sorry, but I am afraid not.
Major Gates: As the country is anxious to see the National Parks Bill become law, could the Lord President say when the final stages of that Bill are likely to be taken?
Mr. Morrison: No, Sir. We have acted very promptly in regard to the National Parks Bill. So far as I know it will go through this Session, but I cannot say on what day.
Mr. Ernest Davies: In view of the Lord President's frequently expressed desire to have the reports of the nationalised industries debated in the House, when will my right hon. Friend give us time to discuss the recently issued report of the National Coal Board?
Mr. Morrison: I have that in mind. I quite agree that it is desirable that at any rate the outstanding reports of current interest should be debated. We have always been willing to make suitable arrangements with the Opposition about that, and I hope that there will at any rate be some debate about the socialised industries after the Summer Recess.
Earl Winterton: Can the right hon. Gentleman clarify a point of procedure about tomorrow's proceedings? The Minister of Labour said he might be in a position to make a statement. Will that take the form of an announcement or will the Adjournment of the House he moved in order that it can be discussed. There have been occasions in the past when such a Motion has been moved.
Mr. Morrison: It would, of course, be a matter for you, Mr. Speaker, as to whether facilities could be provided if it becomes expedient and desirable that my right hon. Friend should make a statement. I have no doubt that ways and means can be found, but matters of procedure are for you, Sir, rather than for me.
Mr. Speaker: We shall, of course, have to wait and see if the Minister is prepared to make any statement. Then I shall consider it.
Mr. Skeffington-Lodge: Reverting to the idea of another Debate on the Press, and speaking as one who voted against the establishment of the Royal Commission, will not my right hon. Friend agree that a mountain has gone into labour to produce a mouse; and will he please be a little "cagey" in accepting the blandishments of the Opposition in regard to staging another discussion in this House on this particular topic, because they will only use it to exercise more bias?
Mr. Morrison: With great respect, I do not see why hon. Gentlemen on this side of the House should be in the least afraid of it. I would suggest to my hon. Friend that he may have been misled by the headlines in a certain evening newspaper last night which even falsified the general purport of the Royal Commission's report.
Mr. Skeffington-Lodge: I am never misled by the Tory Press.
Mr. Henderson Stewart: So that we may follow the workings of his mind regarding the future time-table, would the Lord President now indicate when he proposes that the Summer Recess should take place?
Mr. Morrison: That is premature.
Mr. Martin Lindsay: If the right hon. Gentleman thinks that the newspaper falsified the report of the Commission does not he think that we should have another Commission to which that allegation could be put?

BILL PRESENTED
  TELEGRAPH BILL
  "to repeal Section five of the Post Office and Telegraph Act, 1940, in so far as it applies to contracts made by local telegraph authorities," presented by Mr. Wilfred Paling; supported by Mr. Glenvil Hall and Mr. Hobson; read the First time; to be read a Second time upon Monday next, and to be printed. [Bill 158.]
ORDERS OF THE DAY

  SUPPLY
  [18TH ALLOTTED DAY]
  Considered in Committee.
  [Major MILNER in the Chair]

  CIVIL ESTIMATES, 1945–50
  Motion made, and Question proposed,
  "That a further sum,. not exceeding £50, be granted to His Majesty, towards defraying the charges for the following services connected with Industry and Employment in Scotland in so far as they relate to Agriculture, Fisheries, Food, Transport and Rural Industries in Scotland for the year ending on the 31st March, 1949, namely:

  £

  Class I, Vote 24.—Scottish Home Department

  10

  Class VI, Vote 20.—Department of Agriculture for Scotland

  10

  Class VI, Vote 21.—Department of Agriculture for Scotland (Food Production Services)

  10

  Class VI, Vote 22.—Fisheries, Scotland

  10

  Class VI, Vote 23.—Herring Industry

  10

  Total

  £50"

  —[Mr. Glenvil Hall.]

  SCOTLAND (AGRICULTURE)
  3.53 p.m.
  Mr. Snadden: It is perhaps not inappropriate that today, when we turn to the consideration of the White Paper on industry and employment in Scotland, that my hon. and right hon. Friends on this side of the Committee should have put down a Vote covering the field of food, food production, and transport especially as last week Scotland staged a great national agricultural exhibition. I think that the Secretary of State who happened to be there will agree that in every way it was a magnificent exhibition and lived up to the new title of "Royal" recently conferred upon it by His Majesty the King.
  What impressed me most at that great show was not the general, excellence of the stock on parade, or the wide range of exhibits that could be seen coming from the countryside and representing the crafts and handwork of the countryside, but the enormous crowds of city and towns-people that flocked through the gates of the show and thronged the stalls. I have never seen anything like it; and
  1528
  it was borne in upon me that the significance and importance of home food production in our national economy have at long last been recognised, by all sections of the community.
  Being the first speaker on this Vote, I recognise how vast is the field which could be covered in this Debate. I know full well that many hon. Members will wish to speak and that they will wish to raise questions of a general nature affecting the Scottish countryside. For that reason I have no intention of ranging over the whole field of food or agricultural production and attempting to paint too big a picture. I would prefer to concentrate on what may seem to be rather a narrow field, but a field which is, in my submission, of the utmost importance, not only to the producer, but also to the consumer, and incidentally to our own country.
  Looking at the agricultural picture, and speaking broadly, the basic fact is that in spite of a considerable expansion in British home food production—in which incidentally Scotland has played a very creditable part—the growing of all the food we can produce at home is still an absolutely sound policy in a world of food shortages and exchange difficulties. It is particularly silly, if indeed it is not criminal, to bring into this country any food at all that we ourselves can produce; and it certainly is absolute folly if we should allow ourselves to become dependent on foreign countries like the Argentine for meat when we ourselves in Scotland are especially equipped to produce it. In fact, we all know that on that particular commodity the real future of Scottish agriculture depends.
  I said I had been to the Royal Highland Show. I do not know how many times people said to me, "You would not think we could have a shortage of meat when you see all these magnificent beef breeds on parade." They said, "There is plenty of beef here, but there is nae meat aboot the hoose." Of course, these people were looking at the shop window of Scottish agriculture. They could not know that behind it all is another story. But what they do know is that today as a nation we have the lowest meat ration in our history. They are puzzled that that should be so, and are wondering what we are going to do about it.

  1529
  That is precisely what I wish to ask the Secretary of State this afternoon; what is he going to do about it in Scotland? Are the Government satisfied that everything that can be done is being done to increase the production of meat in Scotland? Have we a long-term meat policy designed to exploit the millions of acres of hill and marginal land we have in the country, and if so will he kindly tell us what it is? That really forms the gist of what I wish to say.
  There is very little information about it in the White Paper. In fact, many figures in the White Paper are already out of date; and except for a passing reference to the fact that there is a small increase of cattle under one year old, and a comment that the output of beef was disappointing, the subject is more or less ignored. Yet the shortage of meat today is on everyone's lips. We know that the meat position is desperate, and worst of all we know that this position will continue far longer than any of us would care to contemplate—including the Minister of Agriculture opposite. So the production of meat, and particularly beef is the black spot on the agricultural picture. Yet there is no country in the world better equipped, both in skill and in natural resources, than Scotland to produce—and to produce fairly quickly—a substantial addition to the meat ration of this country.
  In my opinion what is wanted is what I would call a positive and correct policy. I wish to impress upon the Secretary of State for Scotland as strongly as I can that he has the greatest opportunity any Minister of Agriculture for Scotland ever had of putting Scottish agriculture permanently on the map, and at the same time relieving the desperate meat situation in the country. But unless he and the Government agree to place the production of meat upon a long-term plan, as is being done in Australia, so as to stimulate a drive for meat equal to the drive which has been made successfully for milk, he will see Scotland's most valuable agricultural asset which we have inherited over the centuries gradually fade away.
  We have all the resources in our country. We have millions of acres of hill and marginal land. We have the greatest livestock skill in the world. The world comes to Scotland to buy our animals in
  1530
  order to produce in other countries. We have even got an Agricultural Survey of Scotland. We have the right kind of cattle, but we have no meat policy. There are certain kinds of assistance but the assistance is of a piecemeal, ad hoc, ephemeral character. If Australia must have a guarantee over 15 years' production, so must we. It is because there is no long-term plan today that our farmers are timid in launching out boldly on what is an extremely costly, even hazardous, enterprise, and certainly a very slow-yielding investment.
  Consider our position today in terms of meat production. Sir James Turner of the Ministry of Food says:
  "There is a gap of no less than 800,000 tons in our meat supply, of which 400,000 tons represents the fall in home production."
  The Minister of Food said on 26th May:
  "The meat shortage in this country is entirely accounted for by the fact that we cannot as yet produce anything like the quantity of meat at home that we were producing before the war."—[OFFICIAL REPORT, 26th May, 1949; Vol. 465, c. 1575.]
  From figures recently published by the right hon. Gentleman's Farm Economics Department, we find that in Scotland production of beef has fallen from a prewar index of 100 to 73, mutton to 81, and pig meat to as low as 64. But, of course, production of milk has gone up to 117. It is not my intention today to spend very much time blaming people for the present position, because if I were to be honest with myself I should have to realise that I criticised the Coalition Government when I sat on the benches opposite in 1943.
  When the meat ration was 1s. 2d. I warned the then Minister of Agriculture in a modest way that if in our live-stock policy we laid too great an emphasis on the production of milk when the war was over—and no one knew when that would be—we should face a meat famine. I believe that it was the intention of the then Minister of Agriculture to readjust the balance of our livestock economy, but there is no doubt at all in my mind that the milk accelerator was really pushed clean through the floor, and almost everything else was thrown overboard as a result.
  As for this Government, certainly they have had to face difficulties. They have had to face exchange difficulties which I

  1531
  recognise, but it has taken them 3½ years, with an ever deteriorating position, even to tell us what the gap in meat is. It has also taken them a very long time—until in fact we got a slashing cut in the meat ration—even to look at the whole problem of readjusting the balance. Some hon. Members may think that I am against milk expansion. The hon. Member for South Ayrshire (Mr. Emrys Hughes) is always a little bit apprehensive when I get on to this line, but let me tell him that I want to see as much milk produced in our country as possible in the right places, with economic units working where production can be done efficiently.
  But there is no doubt that we are paying the price for the super boosting of milk everywhere and anywhere at the expense of meat. The high price paid per gallon and the ready money which comes to the dairy farmer are things we all know about. Milk means ready money and, of course, the farmer goes for that. Another reason is the extraordinary efficiency of the Milk Marketing Board. We must remember the monthly cheque. At the same time, we must remember the position of the beef producer who enters into a long-term affair. The cycle of beef production is anything from three to five years, and probably the farmer must borrow the capital to enable him to start his activities. All that time elapses before he gets any reward or return for his money. The absence also of a quick economic return is part of our trouble today, due to not enough protein feeding-stuffs. We have a price policy which has consistently put a premium on sheer weight as against quality on which Scotland's beef economy has been founded. Is it any wonder that the farmer says that milk is the thing and that the quickest way to lose money is to feed for beef.
  So we find ourselves today not only at the mercy of the Argentine but, unfortunately, up against a problem which is incapable of immediate solution. Australia cannot solve the problem. Australia will have to spend millions of money on docks and railways and on recruiting the workers, and even then when all that is done one big drought may wipe out thousands of cattle. The Argentine economy is changing to such an extent that a well know estancia owner has written to this country asking what
  1532
  the possibilities are of coming over to Scotland to produce beef. In his letter I understand he said—significantly I think:
  "What are the long-term prospects? Have the Government a long-term plan? Is it worth my while coming over?"
  If we were prepared to spend even a fraction of the money which is to be spent in Australia, not to speak of this business of hunting for groundnuts in Africa, I am certain that the result would astonish the country. It would certainly put more meat on the housewife's plate, and that is what we want; and if that meat came it would, like our whisky, be of high quality because it would be "Scotch."
  I should like to ask the Secretary of State what he proposes to do about this. Surely, it is not beyond the wit of our experts—and there are plenty on this subject in Scotland—to devise the right kind of policy. Surely the right hon. Gentleman recognises that here and now an immense opportunity is open to him. It may seem an impertinence for me to suggest to this Committee what I think should be done in the matter, because of the sheer magnitude of the problem which is perhaps as big as any as we have to face today. But sometimes we are told that we on these Benches are not constructive. As I have some knowledge of this problem, perhaps the right hon. Gentleman will lend an ear to my suggestions because they are based upon practical experience.
  In co-operation I have engaged in trying to find what I think is the answer to our Scottish problem. What we require are two joint or concurrent meat policies. The first should be a short-term policy covering the pig industry, which is a separate subject and from which everyone knows that we can get the quickest answer. The second should be a long-term meat policy covering both sheep and cattle—that is why I have referred to meat instead of to beef—based upon the full exploitation of the millions of acres of hill and marginal land in our country.
  The first part of the policy depends upon whether or not the right hon. Gentleman can get feedingstuffs. I can say no more about that. We have threshed that subject to death in this House, but I will make a passing comment. It is very strange that France

  1533
  should be able to offer us pork fed upon American maize. It is equally strange that Southern Ireland should be able to place a contract for 500,000 tons of the stuff on a forward basis. This matter greatly affects the right hon. Gentleman. We want far more effective help to increase pig production in this country, but I see nothing about it in this report or the White Paper.
  But it is the long-term meat policy that affects Scotland most. That policy must be a big one, its foundations must be broad and that foundation must be a guarantee to the British home producer on the same lines as that given to Australia. Why should they not have it? Is there any conceivable reason why the home producer should not have it? We should put home food production first. Why should we kick at spending British pounds here on beef production when as a result we would save precious foreign exchange for foreign meat? It defeats me to find any reason.
  Next, once and for all, and even at a risk—because I consider that we are on a tightrope on this question of meat, and that we shall either get into a great expansion or see it fade away—we must have the production of beef placed on a proper competitive basis with the dairy industry. Milk today is showing more profit than meat production, and until meat production can compete on something like level terms with the dairy industry, we shall never get the answer to this problem. The Government have made a recent review of prices, and I am willing to admit that a certain recognition has been given to quality and that prices have been adjusted, but they are still poles apart, and, if this meant a little higher price to the consumer, I am certain, having talked to a good many people in recent weeks, that the masses of the people of this country today would be willing to pay a little more for their meat if they could get it and if they could have high quality. But the tragedy is that they cannot get it, even if they are able to get a little bit, it is almost uneatable.
  There are three reasons for that. The first is the tremendous emphasis on milk; the second is our dependence on Ireland for store cattle, and the uncertainty whether we shall get them or not; and the third reason is the adjustment of the time lag—a quicker finishing of cattle.
  1534
  Give the home producer a fair deal in feedingstuffs, and the opportunity to finish his cattle economically in winter, instead of waiting for the next year's grass. Today, we all know that, when the grass season is over, the tap is turned off and the farmer keeps his cattle lying about until the new grass comes along. Is it any wonder that when the tap is turned off we are at the mercy of Mr. Peron? I do not know whether we are to remain at his mercy, but I think we shall be until this matter is adjusted. We did it before the war and I do not understand why we cannot do it now.
  Mr. Scollan: I have been following the hon. Gentleman's argument very carefully. Is he seriously suggesting that Scotland could provide enough meat to make this country independent of outside supplies, such as those from the Argentine?
  Mr. Snadden: I never suggested that we could, but the fact of our home production having fallen by 400,000 tons places us at the mercy of a foreign country.
  Having got the feeding end right, we should get down to this business of exploiting the tremendous potential reservoir of our marginal and hill lands in Scotland. This is the place where, above all, we can produce the raw material, the beef stores, to be finished down below on the best pastures and on the big arable farms. Obviously, the bigger farms would have a quicker turnover and get the job done more economically than would the small man. I do not think it is any exaggeration to say that millions of acres in Scotland are waiting for what I would call the pioneer's zeal and enthusiasm. I started doing this in partnership with two colleagues in a part of Perthshire which the right hon Gentleman probably knows, and I know something of the difficulties of such a project. The necessity to get the place dry by means of drainage is the first thing; roads need attention. We found the roads in a bad condition and had to spend a lot of money on them. In this direction, I would like the right hon. Gentleman to put some pressure on the county councils to look after their bits of roads leading up to these farms. We ourselves have built a new road at great expense and

  1535
  paid for it out of our own pockets, and would like the county council to look after their piece of road.
  Mr. Emrys Hughes: Is the hon. Gentleman asking a Socialist Government to put pressure on a Tory county council?
  Mr. Snadden: I have not thought of their political complexion. There is the problem of re-seeding, which is a very difficult task, and there is also the difficulty of eliminating rushes. I believe we are as advanced in the technique in getting rid of these troubles as anybody else. There is bracken elimination, there is the problem of winter keep, and there is the problem of acclimatisation of cattle, which is very little different from the acclimatisation of sheep. These difficulties can be surmounted, and the stock-carrying capacity of these lands enormously increased.
  Professor Ellison, who read an interesting paper on this subject in London, has estimated that 250,000 store cattle per million acres could be turned out on such land, and he was not contradicted. Personally, I think that is a conservative figure. We have 10 million acres of rough grazing, and 10 per cent. of our agricultural holdings are marginal holdings. We have got to turn to the uplands of Scotland for our raw materials for beef production, and exploit them to the fullest extent. Why is this not being done? The answer is that it is being done, but in a comparatively small way. Assistance is being given by way of certain schemes, most of them of Coalition Government origin and carried on by this Government.
  I am willing to admit that the Department of Agriculture in Scotland, and particularly Sir Patrick Laird, have taken an interest in this matter and have done a great deal to draw attention to it—far more than has been done South of the Border. I admit all that, but I think that those in the Department of Agriculture will also admit that progress is painfully slow in comparison with the size of the job. One reason is the lack of confidence, the second is the shortage of capital, the third is the lack of incentive in the production of meat by home producers, and the fourth is the lack of guidance on the part of the advisory people. Although I realise that it is difficult to put over the
  1536
  results of research to others, there is a lack of guidance generally on this question.
  We have however the guts of the raw material part of a policy in existing schemes, but all of them need revision. The hill cattle scheme, for example, is excellent in its conception. I have supported it all along, but, if that particular scheme is to get the right result, it will have to be spread over a far wider field. It will have to apply to all the marginal land as well as to genuine hill land, and, secondly, within that scheme, I would say that the new method of inspection since the agricultural committees disappeared is now bringing results. In some cases, the new method is forcing producers to sell off and that is exactly the opposite to what we want. In any event, the whole scheme is far too short-term for a long-term problem like this.
  The great problem of winter keep, about which we hear so much whenever we discuss this question, would be enormously helped if something could be done to help the farmer to meet the huge transport charges on fodder amounting to 50 per cent. of the cost. Hay bought at £8 a ton, on the carse of Stirling, becomes £12 10s. a ton even to the Perthshire hill farmer. Immediately, the job becomes uneconomic because this problem is perhaps the greatest we have to face.
  I would also ask the Secretary of State and his Department to consider some positive method of helping and encouraging the two great foundation breeds that we have in Scotland whose future lies in the development of our hill and marginal lands. I am thinking of the Highlanders, on the one hand, and the Galloways on the other. Just as we have our two lines of sheep in our country, the lack-face on the jagged hills, and the cheviots on the rounded hills, so we have the Highlander and the Galloway. If the Highlanders and Galloways disappear, we shall have no genuine hill store cattle in Scotland. It would seem that the Gallo-ways are, if anything, losing ground. We want to preserve these two great breeds.
  The Hill Farming Act of 1946 has, on the whole, produced what I would call disappointing results. I think it was the hon. Member for Inverness (Sir M. MacDonald) who, if he is correctly reported in the "Glasgow Herald" of the other day, criticised this Act and said

  1537
  it was a failure. I would not go so far as that because it is too early to say whether it is a failure or not, but it is definitely disappointing in its results so far. I think the reason is that the Secretary of State's Department is too dilatory in dealing with the position. Here is an example: 795 schemes have been put in, of which 68 have been formally approved, 224 approved in principle, 34 are under consideration, 20 are delayed by questions and other difficulties, 140 are projected, and 309 are awaiting consideration.
  There is also something wrong when we find such a lack of confidence owing to the activities of the Forestry Commission, on the one hand, and the Hydro-Electric Board on the other. Something must be done to strengthen the confidence of the hill producer. The calf subsidy was English in conception. It is unsuitable for Scottish conditions as it by-passes the breeder and hands out money on the wrong type of cattle.
  The deer forest question has never been properly explored with a view to meat production. Many people, including the northern pastoral men away up in the North of Scotland, believe that much could be done in that direction. Has the Secretary of State considered the memorandum which was sent by the northern pastoral men? We would like to know the Secretary of State's answer. Let me tell him that out of the millions of acres of hill and marginal land I have described, many millions of those acres in Scotland are unimprovable. They are too high and too near the rock. The only way in which those acres can produce food is through stocking them with wether sheep. That is what the pastoral men are asking for, and that is what the right hon. Gentleman has rejected. The alternative is to leave that land unproductive in terms of meat, and, therefore, making no contribution to Scottish agriculture.
  I have said that all these schemes were good in their conception. One might even have been content with them in normal times, but not now when the outlook in regard to meat is so desperate. I do not think that at any time in the whole of our history it has been so bad as it is today. The time has now come, if, indeed, it has not passed, when a far bolder approach to the whole question is necessary. If we fail to produce
  1538
  a long-term policy now which will exploit, as I said, to the "nth" degree our own great home resources, we shall have only ourselves to blame if for years to come we are existing on the miserable pittance of a ration which we receive today, a ration quite unworthy of a country like this, not to speak of Scotland.
  I hope that when the Minister comes to reply, he will not just tell us that he is puzzled at the lack of recognition of the scope of existing schemes, or that he is surprised that I do not think the farmers of Scotland are doing their job, which was the answer I received to a supplementary question I put to the right hon. Gentleman some time ago. I think I know what they are doing, and something about the existing schemes. I hope he will not tell us that we had 29,000 cows on our hills in 1939, and that now the figure is quite different. There has certainly been an increase, but if he says that, I must remind him that a century ago 150,000 store cattle went annually to Falkirk. I must also remind the right hon. Gentleman that the production of meat is down by 27 per cent. as against pre-war. An answer like that may go down in this House, but it will not go down in the country. The meat situation is far too bleak and needs a far more realistic and far bolder policy than we have so far produced. There is an abundance of expert knowledge at our disposal in Scotland let us use it.
  I think it was the hon. Member for Banff (Mr. Duthie) who drew attention, when speaking on the Finance Bill last night or the night before, to the great asset we have in whisky. He said that whisky had been murdered. In exactly the same way meat production has been murdered. I imagine that the production of meat is probably of considerably more value than whisky, and I would ask the right hon. Gentleman to take the chance now, when the going is good, and produce a long-term policy which will not only put Scotland on the map in terms of meat, but will be welcomed, I am sure, by the whole country.
  4.30 p.m.
  The Secretary of State for Scotland (Mr. Woodburn): I listened with interest to the speech of the hon. Member for West Perth (Mr. Snadden) and it struck me

  1539
  that in many ways it was a phenomenon which most of us have experienced in our own lifetime—that a person who happens to be expert in his own particular direction is so close to his own expertness that he cannot see the whole field. Sometimes a person who has not that expertness, who approaches the problem with an objective mind, is able to get a far better grasp of the whole position than is possible to a man who is engrossed in his own expert knowledge. I am told that even in education a high degree of specialisation sometimes destroys the width of mind of the teacher.
  I must confess that I was surprised at the condemnation which the hon. Gentleman made, by inference, of the splendid response which Scottish farmers as a whole have made to the demands of the country in regard to agricultural production because it is an evasion to suggest that the Department of Agriculture does the farming; it is done by the farmers. The hon. Gentleman suggested that in some way limits are placed by me upon the Department of Agriculture in assisting farmers. He produced not one shred of evidence to suggest that there is any limit placed by me on the activities of the Department of Agriculture to give farmers every help they can give them. If he has evidence, I shall be glad to give way to him.
  Mr. Snadden: I am afraid the right hon. Gentleman has got things wrong. When I referred to the Department working within limits, I was referring to the existing schemes of legislation. They are working these schemes to the full, but I called for a great expansion of these schemes. That is not a reflection on the right hon. Gentleman in suggesting that he is limiting the Department's activities.
  Mr. Woodburn: I am glad we are clear about that. The schemes are there. There are limits to them and these limits are physical—the physical limits of our land, of biology, and no one can get past that, not even the hon. Gentleman, as he very well knows. Indeed, in the course of his speech he answered a great many of his own criticisms, but I certainly gathered from him that he was suggesting that Scotland could produce from her own soil a tremendously increased quantity of beef by comparison with what
  1540
  was produced before the war. He talked—and I have seen it in the Press—about this mythical 150,000 cattle which used to come down in my constituency. I have tried to trace the source of this information and, as far as I can see, it is purely a myth. There is certainly no biological justification for believing there is enough food in the land of Scotland to bring that number of cattle to Falkirk, bearing in mind the conditions of that time, in any good year. The hon. Member also referred to milk and spoke of decreasing milk as against increasing beef.
  Mr. Snadden: That is an important point and I do not want the right hon. Gentleman to deceive the Committee about it. I am not suggesting that the price of milk should go down; I was suggesting that the production of meat should be placed on the same profitable basis.
  Mr. Woodburn: He wanted an alteration in the relationship and a changeover from milk to beef. Again, he suggested that farmers in Scotland have turned from beef to milk. There is no evidence of that at all. What has happened is that the dairy farmers in Scotland have greatly increased their dairy stock and have produced far more milk for the very reasons which the hon. Gentleman gave, but there is no great evidence that production of beef has been changed to production of milk to that extent. Constituencies in which the hon. Member for Streatham (Sir D. Robertson) is interested in the Highlands have increased production of milk, of beef, of sheep and of every conceivable agricultural commodity without decreasing anything at all.
  The hon. Member for Western Perth to my mind seems to be confusing the production of beef with the breeding of cattle. In Scotland the production of beef and the breeding of cattle are two separate things. The production of beef has largely come from the importation of Irish cattle, as the hon. Member well knows, and I think he was confusing the situation by appearing to mix that with the Scottish indigenous production of beef. These are two separate questions altogether. I admit right away that we are not able to produce the quantity of beef from Irish cattle that we did before

  1541
  the war, nor shall we be able to do so for some little time. As far as our own indigenous production of cattle is concerned, however, I will deal with that shortly.
  The hon. Gentleman made reference to deer forests and my hon. Friend the Joint Under-Secretary of State will reply to that point in more detail. I should, however, like to say this: I think hon. Gentlemen opposite ought to have had experience of the deer forests in their time, because I am quite sure that hon. Members on this side of the House—and probably I myself—suffered from some misconceptions about the possibilities of the deer forests. I can quite understand that the hon. Gentleman, perhaps in the romantic glens of Perthshire where deer forests are not very prevalent, may have visions of cattle spreading over the Highland hills, but that subject has been examined on behalf of the Government by the Scottish Land Court and investigated in every way by scientific experts, and a report made; and believe me, this picture of thousands and thousands of cattle feeding on the deer forests, especially in the winter time, is just romantic nonsense.
  Mr. Boothby: In view of that astonishing statement, I should like to ask the right hon. Gentleman whether he has any realisation of the opinions which his own party has been expressing about deer forests, on platforms in Scotland for the last 30 years?
  Mr. Woodburn: I have just admitted it. I was just pointing out that the party opposite suffered from that sort of romantic nonsense in its day and surely should not try to repeat it to me now, for I have had the necessity of learning from the facts. I have had a great deal to do with deer forests in the last 20 years and with the farmers who deal with them, and therefore I am talking from the experience of men who know the deer forests upside down—because there are upsides in deer forests and downsides.
  Mr. Snadden: I was talking about stocking them with wedder sheep.
  Mr. Woodburn: We have to keep away from the romantic side and get down to real things. As I say, my hon. Friend will later be giving some facts
  1542
  about them. I am sure the Committee will agree with me that there is no more important problem facing Scotland than that of the countryside, and I certainly understood that we were going to deal with the countryside today. I agree with many of the things which the hon. Gentleman said, and I am not depreciating in any way the contribution he has made. It is common form for everybody to talk about farmers as being continual grumblers and, needless to say, we accept that even when a farmer speaks in this Committee he will do a certain amount of grumbling. When one considers the difficulties they have faced in the past, either from the climate or from the variations in economic conditions, one can sympathise with this reputed weakness.
  In the past the countryside has become of supreme importance when the nation was in difficulty, only to be thrown on its own resources once the danger was passed. This was especially so after the First World War. Then, at the boom period, farmers were often forced to buy their farms at the peak price. They found themselves burdened with debt, which, when prices dropped, became a disaster to many of them. In most cases, as the hon. Gentleman pointed out, it left them with no capital to develop their land and, in order to live, they had to extract everything from the land. We approached the Second World War with a countryside whose lifeblood had been drained by factors beyond its control.
  Mr. Spence: Would the right hon. Gentleman say what was the meat production immediately before the Second World War?
  Mr. Woodburn: I will come to that. During that period farmers felt themselves the victims of chaos in marketing. They saw their potatoes going to be sold for £2 per ton and at the same time, when they reached the customers, the potatoes sold for £11 per ton. There were few markets for their beef, for their main customers were unemployed. It is not the beef eaters of London who eat the beef; it is the miners and steelworkers, and between the wars every possible attempt was made by the Government of the day and by the Marketing Board and other people to try to get people to

  1543
  eat Scottish beef. Farm wages toppled down from 47s, at the end of the First World War to about 25s. 6d. by 1922, and I am told that in some places they came down as low as 18s.
  The first break in that hopeless outlook for agriculture came from the efforts of the Lord Privy Seal who formulated and initiated the programme of marketing boards and planned production. Fortunately, when another Government succeeded the Labour Government of 1931, the right hon. and gallant Gentleman the Member for the Scottish Universities (Lieut.-Colonel Elliot) became Minister of Agriculture, and because of his interest in agriculture he carried on and developed that policy, for which he got too little credit, perhaps, at that time. Ministers of Agriculture during the interwar years were the Cinderellas of all Governments. When the second war came the ideas of overall planning in agriculture, which had been propagated by our party, became the order of the day, and once again agriculture became the mainstay of the country in time of stress.
  Both because of the policy of the present Government, and because it is essential for the life of our community, economic planning has been an overriding principle in all our developments since 1945. In Scotland today we are now in a position to co-ordinate all our activities within a comprehensive plan. The hon. Gentleman asked what the plan was. I think the best contribution I can make to this Debate is to try to draw for the Committee the pattern of what it is, at least in the mind of the Government, and what is the policy of my party in regard to this.
  With the formation of the Scottish Economic Conference it has been possible for the Secretary of State to bring together all those persons and organisations that direct economic life in Scotland. They are able, in consequence, to carry out their activities to fit in with the general purposes of Scottish progress.
  Scotland's problems divide themselves roughly into those which concern the industrial belt, which stretches across the midlands of Scotland, and those which concern the countryside and the Highlands. There will be, of course, another opportunity, I understand, next week of
  1544
  discussing the industrial problems in more detail. Today our discussion concerns the countryside. The prosperity of the Scottish countryside must rest on agriculture, afforestation, fishing, and the tourist trade. I rather regret the perpetuation of this out-of-date feud between agriculture and forestry which seemed to peep out in the later remarks of the hon. Member for West Perth. All these industries are complementary, and not competitive. Together they hold the promise of restoring Scotland to its former activity, and making it possible for a new and happier population to develop.
  The Government have spared no effort to lay the foundations of a prosperous countryside—and there has been no challenge to that statement. They have done this, not in the spirit of charitable doles, but with the inspiration of the State's doing for the countryside of our own country what the Marshall Plan is intended to do for Europe. The hon. Gentleman says, "Why do not we spend as much in this country as we spend in Australia, as we spend in Africa, on development? Why should we give so much for groundnuts and not so much to Scotland?" If the hon. Gentleman really inquires into what is being done for agriculture in this country, he will find we are spending many times more millions on agriculture here than in any other country in the world. I think we ought to have that clear in our minds. America is giving us a great blood transfusion to help us on to our economic feet. We hope by our help to the countryside and to the Highlands to lay the basis of a self-reliant prosperity based on the activity of the indigenous population.
  Agriculture is one of Scotland's greatest industries. The number of people engaged in agriculture is greater than that in mining. It is exceeded only by the number engaged in the distributive and building trades. We have 23,000 full-time farmers, 12,000 full-time smallholders, and 20,000 crofters. In addition there are about 100,000 persons regularly employed on the land. Today, instead of 25s. 6d., the agricultural worker has a basic wage of £4 14s. a week. His occupation today has become more complex, and today agriculture bridges the sciences of engineering and biology. Last year we placed the Agriculture (Scotland) Act on the Statute

  1545
  Book. This Act, along with the Act of 1947, forms an agricultural charter. The hon. Gentleman, who played a great part in Committee in the carrying through of those Measures, will remember that those two Acts form together a charter for the whole countryside. I think it can be truly said that this charter is the greatest single step ever taken by any Parliament towards establishing a secure and prosperous agricultural industry in Scotland.
  The agricultural industry is no longer out on its own. It is part of a great national economic plan by which all our economic resources are harnessed together to provide the best result for our nation. The land is now the responsibility of the three great partners. The State accepts the overriding responsibility of ensuring that land is properly utilised. Owners of land are charged with the responsibility of efficient land management. It is a curious thing that it fell to a Socialist Government to be the first Government to recognise the part played by land management in the responsible conduct of our affairs. The farming industry has security of tenure so long as it maintains the standard of good husbandry. The farming industry contributes skill and the running maintenance of the farms. The owner maintains the capital and the equipment. The State stands by as a partner that helps with financial incentives.
  The hon. Gentleman thinks there are not enough incentives. It may be that if we get back to the inter-war period ideas, the poor farming community will get an idea of what the rest of the community thought was good enough for the farmers. If the hon. Gentleman does not think the incentives enough today, he needs to study the history of the inter-war years to see what other people thought was quite good enough for the agricultural industry. We help with scientific advice and machinery, and provisions of that kind, and with an annual review of prices—and this is where we come to security—with an annual review of prices which ensures an adequate standard of life for the farming community. I remember it is nearly 20 years ago since I met the farmers of Ross and Cromarty who wanted to discuss what my Party's policy was in regard to agriculture. When I put before them our policy, that we thought it desirable
  1546
  that a farmer should know this year what he was going to get next year for his crops, and that we wanted to try to complete a scheme of organised prices, they actually proposed that I should leave my job, and should try to persuade the Conservative Government to bring that policy in immediately.
  Mr. Snadden: That was brought in by the Coalition, not the Socialist Government.
  Mr. Woodburn: The point is that 20 years ago the Ross-shire farmers wanted me to leave my job to persuade the Conservative Government of that day to bring in that policy. When we went into the Coalition we were successful. I am not begrudging any credit due to colleagues in the Coalition.
  The skill of the Scottish farmer is well known, but agricultural science has moved rapidly, and the best farmers in Scotland have not been slow to take advantage of scientific discovery. The keenness of Scottish farmers to know exactly what is the latest in scientific discovery is a remarkable thing. Today our land is a great factory based on the sciences of chemistry, biology and engineering. The State provides in the MacCaulay Institute at Aberdeen the basis of soil research, where agriculture can have advice about soil fertility, soil deficiency, and a remedy for many defects. The Rowett Institute, in which the right hon. and gallant Gentleman the Member for the Scottish Universities was formerly a distinguished worker, has made and is making great contributions to our knowledge about nutrition, and as a result of the research being developed at Moredun, the experiments being carried on by a well-known Scottish farmer in the elimination of cobalt deficiency have given a new prosperity to some parts of the sheep industry.
  Scotland today, curiously enough, has also perhaps the leading experts in the world in poultry, and the Hannah Institute in Ayrshire, in which the hon. Member for South Ayrshire (Mr. Emrys Hughes) takes a great interest, is well known for its contributions on the dairy side. Research is also now available on our fruit production side, and today we are having the salvation of our soft fruits as a result of the scientific work at Kincraig and in Perthshire. The agricultural colleges, the universities and the research institutes are

  1547
  all playing their part, and the new agricultural advisory committees which I am about to set up under the 1948 Act will help to ensure that the results of the research are translated as early as possible into the practical work of the farmers.
  The community has, of course, laid a great duty upon agriculture. It has asked that production from the land should be increased to 50 per cent. above pre-war and 20 per cent. above 1946–47. I thought the hon. Member for West Perth was unduly pessimistic and downhearted about this. I am glad to say from my information that Scottish agriculture is now running at approximately 30 per cent. above pre-war. Therefore, far from depreciating what the farmers have done, I give them every credit for the spendid response they have made. It is true to say that Scottish output in beef is 27 per cent. below prewar, but, as I have explained, this is due to fewer imported Irish cattle—[HON. MEMBERS: "No."]—and a reduced rate of fattening owing to the absence of sufficient feedingstuffs. I can assure the hon. Member for Galloway (Mr. McKie), who comes from a dairy country, that that is the fact. That is the beef problem, although he is perhaps not aware of it.
  Mr. McKie: The right hon. Gentleman has drawn attention to me. I do not know why he should single me out. Although I do come from a dairy country and am particularly interested in dairy farming, I am also interested in seeing justice done to the beef producers as well, of whom there are a great many in my constituency.
  Mr. Woodburn: I was merely suggesting that those are the facts, and that we should not carry on these Debates under any delusions. We should get down to the facts.
  Mr. Scollan: Is it not the case that in pre-war days there was a regular service bringing Irish cattle over to Scotland—what they called store cattle—so that the credit for the Scottish-produced beef was really in consequence of bringing over Irish beef to be fed for some time in Scotland?
  Mr. Woodburn: Yes, it was a very great part of Scottish agriculture. It was not only beef that came over from Ireland. The cattle performed useful service on the
  1548
  land here while being fattened. We have to admit that the beef is not there. That is the point I was making—the distinction between beef production and the indigenous production of cattle. We do show, however—and this is the point I want to make—an increase of 23 per cent. in home-bred young cattle, which indicates that the policy of the Government is beginning to produce results. Beef cattle have increased in the Highland area and this is important—from 78,480 in 1937 to 135,955 in 1948; and they have gone up in Scotland as a whole from 543,519 to 671,581. Thus, our cattle population as a whole has increased in the Highlands by over 40,000, and in Scotland as a whole by over 120,000.
  Mr. Snadden: The beef is down.
  Mr. Woodburn: The beef from these cattle is not down. It will be up very shortly, if the hon. Gentleman waits until it reaches the market.
  We have increased the sheep population in the Highlands from just over two million by about 300,000, though in Scotland as a whole the sheep population has decreased by about 800,000, owing to greater cultivation. We cannot ask the farmers to plough up land and at the same time feed the same number of sheep. In the last year, however, we have added over 700,000 to our sheep population in Scotland. Already advantage is being taken of the hill-farming scheme to a very great extent. This is a point on which the hon. Member for West Perth went wrong. Sheep cannot be put on to the hills unless there is food on the hills to feed the sheep. Therefore, the land must be brought back to a state in which it can maintain sheep before we can put the sheep there.
  Naturally, we depend very largely on the agricultural executive councils, who know their own districts well and who have the duty of seeing that every available bit of land is used. If there is any deficiency to which hon. Gentlemen can call our attention, we shall be very glad to look into it, because we also are very anxious that this policy should be pursued to the maximum.
  Lord William Scott: Have the losses from 1947 yet been made good?
  Mr. Woodburn: They are just being replaced. Curiously enough, it hurt the Lowlands most. The losses have been made good far more in the Highlands. In the Lowlands they may not have recovered. That recovery will take about a couple of years.
  The hill-farming improvement scheme has now been taken advantage of to the extent of £2¼ million. That is what the improvement works are estimated to cost. The hon. Gentleman seemed to think that that was a mere bagatelle. I wish he would look back into history to see whether any other Government has done for the Highlands of Scotland what this Government has done. The number of poultry in the Highlands has increased from 1,239,775 in 1937—and I am giving these detailed figures so that they will be recorded in the OFFICIAL REPORT, in case hon. Members may want to use them—to 1,820,982 in 1948. That is an increase of nearly 50 per cent. Taking Scotland as a whole the increase has been from 7,552,000 in 1938 to 9,284,741—an increase of nearly 50 per cent. over the number at the end of the war. Hon. Members are beginning to see the advantages of that, in both eggs and in unrationed meat. It is clear, therefore, that Scottish agriculture is tending to develop in those directions which are best suited to its soil and farming skill.
  Before leaving the beef question let me say a word or two in reply to some of the points made by the hon. Gentleman. He referred to the Galloway. I am informed that the Galloway is suitable only for wet soils. He also referred to the Highland. The Highland is being bred, as he knows, with the Shorthorn—I think he is doing it himself—and with the Aberdeen Angus. We are trying to bring out cross-breeds which will be able to live out in the hills, and to get quality as well as the quantity. I am informed that the Shorthorn has rather too much bone. One farmer I visited is trying to breed Shorthorns with the Aberdeen Angus in such a way as to get a little more quantity and yet keep the high quality of the Aberdeen Angus. I believe the hon. Member for Torquay (Mr. C. Williams) has been crossing the Highland with South or North Devons with some considerable success.
  Mr. Charles Williams: With South Devons. It does, of course, pro-
  1550
  duce a very hardy stock of first-class beef.
  Mr. Woodburn: It is most encouraging to find that in all parts of the Highlands different people are trying out experiments to get the best type of cattle out on to the hills. The importance of that is that it does away with the economic necessity of having great buildings and shelters for the winter, and leaves only the essential problem, which I thought the hon. Gentleman treated rather lightly, of winter keep. When speaking about the number of cattle in the Highlands he knows, probably better than I do, that the number that can be maintained depends not on the number that can be fed in the summer, but on the number that can be maintained during the winter and brought to fattening in the summer. I thought that in that respect there was a little confusion in his contribution.
  So far as our main crops are concerned, it is interesting to note that farming has also responded here to a demand for an increase. They have responded to our demands splendidly. Oats have gone up from 815,000 acres pre-war to 930,000 acres so far this year. Barley has increased from 84,000 acres to 169,000 acres, which I am sure will delight the hon. Member for East Aberdeen (Mr. Boothby); if it does not give him immediate prospects, it will give him hopes in the future for his well-loved industry. Potatoes have gone up, because the farmers have been pressed to plant them, from 134,000 to 194,000 acres. Alongside this has been a great campaign for the conservation of grass, either in dried form or as silage for winter feed. There has been a great development in the direction of getting winter feed from our own soil.
  Unfortunately, we have not the luscious grass which is to be found south of the Border. We are making the greatest use of our grass at the moment, with the result that with all the livestock feeding on it there is little margin left over for the winter. The possibilities of grass and hay drying are not therefore so great in Scotland as in more luscious parts south of the Border. But there has been a great development here, both in the form of dried grass and silage for winter feeding. There is every reason to believe that the 108,000 tons of silage

  1551
  made in 1948, which was an increase of 43 per cent. on 1947, can be greatly expanded to the benefit of agriculture.
  I should like now to say a word about the Highlands, which is a subject very dear to my own heart. The Highlands form a great problem of their own, but they are also part of the nation's comprehensive plan. The Government have approached the Highland problem in two ways. In the first instance, they have contributed assistance to the day-to-day problems which arise. The second and more fundamental approach is to lay down a course of assistance towards progress in the Highlands, which will lay a foundation of prosperity on which Highland life can flourish. Much of this is steady, constructive work which attracts little notice, but in the aggregate, if it is successful, it will remake Highland life.
  The Highlands benefit from the general capital investment of the State in agriculture, but in addition the Government have set themselves the task of making a comprehensive contribution to Highland prosperity as a whole. It is calculated that had the Highlands been able to retain their population about 180,000 more people could be living there today. This loss since 1871 is less spectacular than the Highland clearances, but it is no less tragic. The Highlands have made their contributions in wars, and their sons and daughters are playing important rôles in developing other parts of their own country and in many lands beyond the seas. Their gain has been Scotland's loss.
  The first problem was to try and keep the people in the Highlands. We began by helping to provide homes and giving the people the means to live. About 2,500 houses are under construction by local authorities, and they are being built as quickly as the labour force there can do the job. The Chancellor of the Exchequer, in his negotiations with Sweden, was able to secure the supply of 1,000 timber houses. We were able to have all these allocated to the Highlands and I am glad to say that our efforts at speedy construction have been successful, and that the first of them will be opened in Lerwick next Monday.
  Commander Galbraith: Is that 1,000 included in the 2,500?
  Mr. Woodburn: No, Sir. It is additional. It has been an experimental operation as Members will recall, and I am glad that it has succeeded. The work has gone ahead almost like a military operation, as shown by the fact that these first houses will be finished within five months of the final arrangements being completed. This is probably the biggest and speediest single contribution ever made to Highland housing. I made a regulation recently, with the permission of the House, authorising grants to crofters both for building new houses and for improvements, and already 350 applications have been received within the space of a week or two.
  Closely associated with the need of housing is the demand for modern amenities. The North of Scotland Hydro-Electric Board has already brought electricity into homes in the Highlands, which in itself provides power for many articles of domestic enjoyment and use. Parliament authorised £20 million to help Scottish rural water supplies, and in 1948 16 schemes in the Highlands, costing £1 million, were authorised. A considerable proportion of that will be spent in the Highlands, where grants are up to 85 per cent. of the cost. The work here is already going ahead. The State has now assumed complete responsibility for five additional trunk roads, and although curtailment in capital expenditure on roads has been necessary, the Government have made an exception of the Highland roads and work on them goes on. The work that remains to be done on road improvement in the crofting counties, the whole cost of which is being met by the Government, is estimated to cost £8½ million.
  While not in itself an essentially rural service, the development of the hydroelectric supply in the Highlands is making considerable contributions in the direction of good roads, and opening up the countryside. Consumers in the board's area are being connected at the rate of 15,000 a year, and the total value of the programme in hand and under consideration approaches £100 million. The profits on all these works are reserved by Act of Parliament for the benefit of the Highlands. To give some idea of the total agricultural subsidies being given to the Highlands, they should amount in 1949–50 to about £2 million out of the Scottish total of £7,920,000. I suggest

  1553
  that Members opposite should not depreciate what has been done. Parliament has taken great steps for Scotland, although the fruits of the generosity will not be forthcoming for some time.
  This great plant for the Highlands which is rapidly taking shape is assuming the character of a great and hopeful adventure, which could reach a grandeur comparable in interest to the rest of the world with projects like that of the Tennessee Valley. We are able to harness all our developments to the common purpose. In the Strath Oykell area, and in other areas now being surveyed in the Highlands, forestry, formerly the rival of agriculture, is now working with agriculture to their mutual advantage. One of the problems of the steep hillsides of our mountains is that the rain is there today and gone tomorrow, but in the meantime it has washed much of the wealth out of the soil.
  With our plans to restore the soil by fertilisers and cultivation, we are also taking steps to halt the rate of drainage by afforestation. Belts of trees will be planted along the hillsides. Each tree drains upwards of six tons of water every year. These trees will slow down drainage and provide shelter from the winter storms. Cultivation in the low-lying land will be aided, and in the summer the sheep and cattle will be driven up through gaps in the forests to feed on the uplands, while the low-lying land will help to contribute winter feed. The Highlands are one of the main parts of this country where a really substantial new addition can be made to the beef-producing population of our country. I congratulate the hon. Member for West Perth (Mr. Snadden) on the efforts he is making to breed cattle to live out during the winter. I and my Department take a great interest in his efforts in that direction.
  An increase in cattle population of the Highlands depends on how many cattle can be maintained throughout the winter, and with the provision of winter feed many more cattle could be fed on the hills in the better weather. Experiments in breeding are taking place in several parts of the Highlands, as I explained, and cattle are being developed which can live out all the year round, providing good animals without the cost of elaborate buildings for shelter.
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  The repopulation of the Highlands with cattle will itself contribute to the destruction of bracken and bring even more ground back into use. I remember one of the farmers in Ross-shire stating that when cattle were on the hills there was no bracken. If we get cattle moving on the hills we can prevent a great deal of this problem about bracken. Already science is beginning to discover that what the cattle did was not to cut the bracken but to break it, and when it is broken it bleeds and is destroyed much more effectively than if it is cut. In some cases it is quite uneconomic, however, to bring much of the marginal land back into use. No individual can afford to spend money to bring that land back into use. It could only be done by the State, and at the moment I am considering embarking on schemes which I hope will recover some of the lost agricultural land and give it new life.
  There are other great resources waiting to be developed in the Highlands. The Government have just allocated £55,000 in order to commence research on the exploitation of peat. The Seaweed Research Association is developing ways and means of harvesting the crops of the sea, while investigations are taking place into mineral resources with a view to their providing still greater wealth. The division of labour divorced industry from agriculture, and the food that came from the land was taken for granted in the towns.
  Even yet, it is not quite realised that when the farmer grows the crops, the town dweller has a responsibility to see that nothing is lost of the value thus created, and it is for this reason that the country appeals to the towns to help to harvest the produce of the land. I regret to say that some city administrators are not so conscious of their dependence on the land, but I hope they will realise their duty in the future. Adversity has brought the land and the town together. It is also helping to bring understanding that towns can only exist because our basis is provided for their life by work on the countryside. The nation has recognised its responsibility, and that is new in our history. We have given security and rights to those who live on the land and we expect and shall receive the food and sustenance which it is their duty to provide.

  1555
  The people of the countryside are now more conscious also, that they are members of the community and that their lives and prosperity are inter-linked with all of us in the prosperity of the nation as a whole. Our future is not entirely in our own hands as we are part of a great world economy, but it is the Government's policy that it is an essential part of our national economy that we should preserve a healthy and efficient countryside and that henceforth no plans for the nation can ignore the needs of the countryside. Town and countryside together, the nation will go forward to work out its own destiny and increase the general prosperity in which everyone is entitled to share.
  5.14 p.m.
  Sir David Robertson: The Secretary of State, in opening his speech, referred to my hon. Friend the Member for West Perth (Mr. Snadden) as being under the disability of being almost too great an expert; he was too close to the job. Let me assure the Committee that I do not suffer from that disability. I have no claim to farming knowledge, and I am speaking in this Debate solely because the members of the Northern Pastoral Club, who have been referred to by the Secretary of State and by the hon. Member for West Perth, have asked me to do so and because I think people in that part of the country have been made inarticulate in Parliament for many years—certainly for not less than the 10 years during which I have been here.
  The right hon. Gentleman made an interesting speech, and it would be unbecoming if I failed to pay him credit for the work which he and his colleagues are doing for Scotland in agriculture. The right hon. Gentleman has this matter very much at heart, as I think all Scottish Members have, and I am sure we must have rejoiced at the figures he quoted showing the progress which is being made. I would just remind him that this is due primarily to the hunger of the people of this country, and when he said that no Government in history had ever done as much for Scottish agriculture as the present Government, surely no Government ever had such an opportunity. [HON. MEMBERS: "Oh!"] Oh, yes.
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  Hon. Members must remember that in the laissez faire Liberalism days of the 19th century, the farmer was thrown to the dogs not only in Scotland but all over the country. We had to get payment for our manufactured goods from the primary products of other countries, and many of the problems that we face today are the evils which arise from that policy. Our farmers on the best land had a very hard struggle to compete with dumped overseas products from cheap and sweated labour countries and from coloured countries. Certainly, these marginal land and deer forest problems could never have been tackled in the 19th century. Our best land had frequently to be worked at a loss, and secondary land could never have been worked without bankruptcy. The situation is entirely different from that of 1939. We have no alternative but to bring the marginal land and derelict acres back again to cultivation and to bear crops.
  Every country in the world, including our great Dominions, is becoming increasingly industrialised. In the recent meat Debate we were told that one of the reasons why the Argentine had failed to give us the quantities of beef we had ordered or had expected, was because so many thousands of peons had left the land and had become factory workers. That is true in Buenos Aires; it is true all over the world. Canada is a great industrial country today; 50 years ago it was not. We are so severely restricted in Canada and the United States today owing to the lack of dollars and the lack of exports to buy agricultural products, that we are virtually out of those markets.
  Therefore, this Government or any Government must begin to intensify food production for Britain if we are to maintain our population. I do not take a pessimistic view of it at all, but I have seriously thought since 1945 that with the increasing industrialisation of all these other countries, who were our customers and who may now be our competitors, we are going to have an appalling task in finding enough money to buy all the raw materials we require to maintain full employment in our factories and to keep something to spend on food.
  Maybe the Chancellor of the Exchequer on Tuesday will have something to tell us on that important subject. I must make that point abundantly clear now

  1557
  because while I should like to give the Government the greatest possible credit for what they have done, I feel it would be quite wrong of them to preen themselves and say they have done something which nobody else has done. Nobody else ever had the opportunity, and they would be failing in their responsibility if they did not now take steps to increase beef production and all the other kinds of food production so urgently required.
  We have heard something about the deer forests, and the Secretary of State has unburdened his conscience of 20 years ago by relating the romantic stories he used to tell in Ross and Cromarty and elsewhere about the Tory neglect of the deer forests. Now, apparently, he takes the view that nothing can be done about the deer forests.
  The Joint Under-Secretary of State for Scotland (Mr. Thomas Fraser)The Joint Under-Secretary of State for Scotland (Mr. Thomas Fraser)indicated dissent.
  Sir D. Robertson: The Under-Secretary shakes his head. The Northern Pastoral Club, the organisation which represents the great cattle men in the north, in Orkney and Shetland, Caithness and Sutherland, Ross and Cromarty, Inverness, Argyll and Morayshire invited me to meet them on two occasions recently, and I am going to report to them tomorrow morning. There are 2,800,000 acres of deer forests, and the members of the Northern Pastoral Club are willing to restock these forests now if the Government will let them.
  Mr. Scott-Elliot: Is the hon. Member aware that under the Hill Farming Act good work is being done in stocking deer forests with wedder hirsels?
  Sir D. Robertson: I am not aware of that, but I would not dispute it. I am telling the House what some of the greatest experts in Scotland told me only a few weeks ago. They offered to put 30,000 to 50,000 beef cattle on these deer forests and from 300,000 to 500,000 sheep. They made this offer in a memorandum which I forwarded to the Secretary of State. All they asked, in return, was that the State should bear half the cost of an insurance scheme for protection against storm losses. It would have cost 5s. per cent., and the farmers were willing to pay half if the State would pay the other half. Unfortunately, this proposi-
  1558
  tion was never seriously considered. As in so many other things, the Minister of Food was the nigger in the woodpile. The right hon. Gentleman wants lambs for slaughter; he does not want them to go up on to the hills for breeding. The farmers there characterised his action as being like cutting green corn, and that is how I characterise it, too.
  Mr. T. Fraser: Surely wether lambs are not breeding stock.
  Sir D. Robertson: I am talking about male lambs that are able to stand up to the winter and stay on the hills for a year without being put into corrals and barns. The female lambs, unlike the female of the species in other directions, are weaker. However, irrespective of whether they are male or female, the fact is that the Minister of Food requires them for slaughter. As a short-term policy I think that is wrong. In view of the agreement which has been negotiated recently with the Argentine, I ask the hon. Gentleman to ask his right hon. Friend to have another look at this matter. These expert farmers, who get their living doing this kind of thing, are anxious to do something for the country. Let the Government meet them half way. Keep the lambs away from the Minister of Food's knife. Let them get away on to the hills. The long-term problem is just as acute as the short-term problem.
  Marginal land has been referred to, and I rejoiced to hear the Secretary of State say that he has in mind a scheme for bringing more derelict acres into cultivation. I spent some weeks in the North of Scotland recently where, going along the roads and looking across the river valleys, I saw moorland and hill land covered with heather, rushes or scrub and, here and there, an acre or so which had been cleared away round a cottage. If that land had not been cleared nothing green would have been showing. Such clearings showed what can be done. Cotters have cleared isolated patches of three, five or ten acres of land from which they are getting a living. I have already said why in previous generations this work was uneconomic. It would have led to bankruptcy. To do the work today State assistance will be needed.
  We have the Government buying hill land for forestry purposes. Why not buy land of that description and restore it

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  for farming and stock-raising purposes? If that was done no one could say that Government money was being used for the benefit of private landlords. Such land is producing nothing today, and it should be remembered that we are talking about more than half the total territory of the whole of Scotland.
  Mr. Willis: Is the hon. Member suggesting that we should nationalise more than half the land of Scotland?
  Sir D. Robertson: No, I am doing nothing of the kind. I am suggesting that as the State buys land for forestry purposes, they should also buy land for reclamation. I do not believe the job can be done by grants or loans, although maybe that is what the Secretary of State has in mind. Maybe he wishes to do something similar to what was done by the Duke of Sutherland, once removed, who spent £250,000 at Lairg in the '80's, where he did a great reclamation job. In a country so small as Britain half the area of Scotland represents a great part of the whole and it would be the greatest neglect, in view of our immediate and long-term problems, if we allowed marginal land to remain uncultivated.
  Mr. Emrys Hughes: Does the hon. Member suggest that this job should be done by the State? Is he advocating State farming?
  Sir D. Robertson: No; the hon. Member is trying to make a party point. I am trying to make a speech without party bias.
  Mr. Willis: If the State buys land and does this work, surely that is a form of national enterprise.
  Sir D. Robertson: It is a form of national enterprise to buy land for forestry. Does the hon. Member deny that the Government are buying land for forestry?
  Mr. Willis: No, I am in favour of it, but I am asking the hon. Member whether the Tory Party have suddenly become converted to the idea of the State acquiring half the land of Scotland. We should like to know.
  Sir D. Robertson: The hon. Member is making a party point; I am dis-
  1560
  appointed in him, because I had a higher regard for him than that. I am against nationalisation in any shape or form. The Government and their predecessors have bought land in the Highlands for forestry purposes, and I am suggesting that some of this marginal, neglected, or, shall I say, uneconomic, land, should be taken in hand by the State. As an experiment let them take over 1,000 acres, and show the people what can be done. That might stimulate private enterprise to follow suit. On the other hand, it may be that the capital cost would be too high for farmer and crofters, though the work would still be worth doing for the sake of the people's food.
  Mr. Hector Hughes: Is the hon. Member's argument that the State should acquire uneconomic and not economic land? What is the principle on which he is basing his argument?
  Sir D. Robertson: The hon. and learned Member is, again, on a party tack. I have made myself abundantly clear, and I think I have come out of this a good deal better than my questioners.
  Now I come to a subject on which I am on firmer ground—fishing, which is second only to agriculture as our oldest and greatest food-producing industry. My hon. Friend the Member for West Perth said to the Minister, "Where has all the fish meal gone?" The Minister of Food could tell him. It is lying at the bottom of the sea. In a mistaken effort to enable more fish to be carried to this country from Iceland, Bear Island and the Barents Sea, trawler owners were encouraged to cut off the heads of their codfish and throw them overboard. That represents 25 per cent. of the weight of the fish. Each week the heads of millions of codfish are cut off and thrown overboard and decay on the banks. It is wasted food, for it has the highest food value for bone meal. I raised this matter in the House some time ago. I thought the Minister of Food looked very uncomfortable and so he ought, because it was an amateurish attempt to do something in an utterly wrong way.
  It would pay the Government to offer premiums to the fish industry to bring all the fish in with heads on so that the farming community could get cattle

  1561
  feedingstuffs of fine quality which they require. Scotland cannot make any increased contribution in white fishing owing to the over-fishing of the North Sea, and catches will become progessively less because boats will find it uneconomical and it will become a struggle for the survival of the fittest unless the Government at ministerial level really make an effort to protect the fishing banks of the North Sea. Government Committees of civil servants are dealing with this matter in an international sphere and they are making no progress whatever. There is still a colossal wastage going on. In every line fishing port, every seine net fishing port and trawling port——
  Mr. Malcolm MacMillan: I am not disputing what the hon. Gentleman said of the dangers of over-fishing, but would he not agree that the Government have made every effort, as did their predecessors, to try to come to an agreement on the restriction of fishing at the point where it appears to be antisocial?
  Sir D. Robertson: I am sorry I cannot agree with that. The Government are blameworthy for the time which has elapsed since the international conference was held, which was about two years ago. All these other friendly nations, who are sharing this common heritage of the North Sea and the near waters with us, are failing to get agreement on a problem that will destroy us all unless it is cured. It is right to protect salmon; it is wrong to protect cod which is so much more important. It is right to protect grouse; it is wrong to protect haddock.
  I have asked the Minister of Agriculture and Fisheries—we sometimes forget that he has any connection with Fisheries but I would not be blamed for that—to deal with this problem at ministerial level, and get his opposite numbers in Norway, Sweden, Denmark, Belgium, Holland, France, Spain and Portugal around the table and hammer out an agreement. We are trying to do this with affairs which are infinitely greater than that, and if this were tackled by the Secretary of State and the Minister of Agriculture and Fisheries and not continually left to civil servants, who are unable to say "Yes," but, like Mr. Vyshinsky have to go back to their respective Governments for orders, we
  1562
  might arrive at a solution. Let the men who are in a position to say "Yes" get round a table and quickly we shall see them reaching agreement.
  Mr. MacMillan: This matter should be clarified in fairness to the Government. How is the hon. Gentleman going to compel these other countries to ratify an agreement and convention once we have passed that agreement but which they will not ratify unless they have the sense themselves to see a little bit ahead?
  Sir D. Robertson: I agree it is quite impossible to compel any foreign government today to do something they do not want to do, but I should have thought that the economics of this matter would bring it to an end, because it is not going to pay people to go fishing. I should have thought it far better to put that position plainly to these foreigners and tell them the sooner we get this agreement the better.
  My final word must be about herrings. The situation in the herring industry is entirely different from that of white fishing. There is generally an abundance of herrings around our coasts, and particularly the Scottish coast, between May and December. We are not making a very good show of distributing them at the present time. At Lerwick the bulk of the season's catch has gone to Germany, yet we are short of food. We are buying all kinds of imported and inferior foods, and yet the finest food we produce in Britain, which is the herring—it is almost as good as Aberdeen Angus beef and may be better in some respects—is going to Germany. We are using our meagre resources in men and craft to fish for the Germans who are able to catch their own. That is because the Ministry of Food and the Herring Board throw up their hands and say that Lerwick is too far from civilisation and they cannot deal with these herrings in Britain.
  During the First World War we were faced with a similar problem, but we organised a carrier service to bring the herrings from Stornoway to Mallaig, Kyle of Lochalsh, and Oban. It was a great success. Why not bring the herrings from Lerwick to the railhead at Wick and then send them to all parts of the country. The present policy is a shameful failure at the moment and the reason for this lamentable failure is that the Herring Board and the Ministry of Food

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  have failed to carry out the programme of the Board made two years ago on the subject of quick freezing and cold storage. They are wallowing along in a pitiful manner, and they have set about converting the cold storage warehouses in the City of Perth. That cold store was built for security reasons, and for no other. It was a perfectly good reason in wartime, but in peace-time to take that store for the freezing of herrings which are landed at far north ports is just sheer lunacy. I am in the cold storage business, so I have to make that declaration. I was one of the first ever to freeze fish in this country, and that was many years ago. I claim to know something about cold storage practice.
  To take this cold store in the city of Perth, which has lain derelict since the end of the war because it has no commercial use, and to foist it on to the poor, afflicted herring industry is shameful. The herrings are caught in drifters without ice, they are brought in on the following morning at some northern port. The herrings have not improved since they were caught, because they are slapped one on top of the other without the cooling and preserving that ice would give them. They never needed ice before, because in the past the curers liked their fish a little high.
  The fish that is taken in the Minch are landed at Ullapool, Lochinver and Loch Clash; and there are no railways at any of these North Western ports. They have got to go by road haulage to Invershin, 50, 60 or 70 miles away and then by train to Inverness. From Inverness it takes six or seven more hours to Perth. These fish will be stale by the time they get to Perth. Some of them will be rotten, and then the Ministry of Food and the Herring Board are going to get busy and put more expenditure on them. They will cold store them and freeze them without a market in sight, and at some future date when there is a famine and the people are hungry enough they will issue these fish in the hope they will be eaten.
  I hope the Secretary of State will listen to my words on this matter. I hope he will stand up and strike a blow for Scotland, because this may well not only hurt the people, but hurt the herring industry and it will hurt this new quick freezing industry which is showing so
  1564
  much promise. I strongly urge the Government to take steps to bring it to an end.
  5.40 p.m.
  Mr. Scott-Elliot: As a Scotsman representing an English constituency, I always feel apologetic for intervening in a Scottish Debate but, in view of my semi-official position in connection with the committee on Hill Farming, perhaps I might say a few words. I shall not follow too closely what was said by the hon. Member for Streatham (Sir D. Robertson), in part because I do not understand about the fishing industry and in any case prefer not to discuss it today, and in part because I want to deal more specifically with certain features of hill farming, adding to what has already been said by my right hon. Friend.
  Sir D. Robertson: The hon. Member seemed to indicate that it was improper for me to discuss fishery today, but if that is what he feels, then he is entirely wrong. I took the greatest pains to make sure that the matter would be in Order.
  Mr. Scott-Elliot: Of course, I understand that it comes within the purview of the Debate. It is simply that I am not capable of discussing fish. Perhaps I might suggest in all politeness to the hon. Gentleman that he does not know a tremendous amount about hill sheep.
  Sir D. Robertson: I confess it.
  Mr. Scott-Elliot: That is how it works out. We are told in the report that schemes representing £2 million have been approved. My right hon. Friend went one better and gave the latest figure, which was £2¼ million. I wonder how many hon. Members realise how much hard work of all kinds is involved on the part of the promoters of the schemes, and on the part of area committees and officials of the Department of Agriculture for Scotland, whether out in the areas or at headquarters in St. Andrew's House, in examining and carrying through these schemes. I want to say a word on this aspect of the matter.
  I want to tell the House what I myself have been doing during the last two years. On behalf of my right hon. Friend I have been conducting a series of tours in various parts of the country. Last year I was in the central and eastern areas.

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  This year, so far as we can, we shall be in the Highlands and in August we are going up to the north. I go out with the officials of the Department of Agriculture. Broadly speaking, my object is to see what is being done and to report to my right hon. Friend, and, in the next place, to give practical examples to show that my right hon. Friend and his Department are seriously concerned with the day-to-day working of the hill farming areas. Finally, and perhaps the most important point of all, I try to bring the farmers and the officials together in order that they may understand each others' problems to a greater degree, although they live, in most areas, in separate compartments. I feel that the officials might not quite understand the practical difficulties of the farmer, and I am equally convinced that farmers do not always realise the enormous wealth of knowledge that is stored up in the Department of Agriculture for Scotland and do not pay sufficient regard to it.
  These tours are very well planned, and I want to thank those who have been responsible for planning them for me, and in particular the area committees and the hill farming sub-committees working under them. Incidentally, it is a very good example of the way in which this thing is working out. The hill farming committee contains one or more practical men such as shepherds. That is very good. We have a few landowners, but mostly farmers. We want the practical men who are doing the day-to-day work. We have seen many comprehensive schemes, covering most of the subjects dealt with in an appendix to the report.
  There will be complaint at the delay that has taken place. We know that there has been great delay, but we know that it is totally impossible to do anything else than go slowly at it, so long as officials are so few in number. We simply cannot recruit and train men to examine these schemes, responsible men who can look with a practised eye at all the things that have to be examined. Until we get a sufficient output of young men from universities with the proper qualifications, it will not be possible to increase the technical staffs of the area committees in order that the work may more quickly be carried out.
  It is a very serious matter, and I am sure that my right hon. Friend realises
  1566
  how serious it is. I have spoken to him about it and he has expressed to me his very deep concern. It is something that simply cannot be overcome, because the men are not there. There is one way of by-passing it to a small extent, and that is for those who are promoting schemes with the agreement of the area sub-committee to go ahead in cases that are appropriate. They must recognise that until a scheme is absolutely approved they may not get a grant, but where a clear hint is dropped to them by one of the technical officials that it would be a good thing, and that so far as he can see there should be no reasonable objection on the part of the Secretary of State, people can go ahead with their schemes. Indeed, in many parts of the country people are doing it. I can speak as one who has pushed ahead with a certain number of things myself, although I have not until recently been in a position to put in claims under these schemes.
  We want many more schemes than have been put in. We cannot compel people to put in schemes under the hill farming plan. If the landlord or the tenant or both—very often it is the joint scheme that is being held back—do not make up their minds, it may be possible to stimulate their interest under the Agriculture Act. I do not believe in compulsion, nor, I think, does my right hon. Friend. We must try to get our results by co-operation. It is therefore necessary to consider seriously the question why people are not putting in schemes more readily. It may be due to frustration among those who have put in schemes and have seen how slow a process it has been to get the schemes examined. I have already explained why that is so. It may also be due to the fact that a certain number of landowners, and perhaps farmers, are a little lazy and unbusinesslike. It is also due to some extent to the fact that certain individuals simply cannot afford to put in schemes. That is an aspect of the matter that we may have to face in the future, although I do not propose to say anything more about it at present.
  I am sure that we want a greater balance between sheep and cattle. I have seen many schemes where there is too much emphasis on one or on the other. By and large, it has generally been a case of the farmer not being sufficiently

  1567
  interested in having the right number of cattle on a hill. Recently I saw an example of the other kind of emphasis, in which a big landowner-occupier was engaged in putting only cattle on to the hill. We had to tell him that the provisions of the Hill Farming Act would not allow him to get a grant unless he put on sheep also.
  Sheep and cattle are complementary. In the summer they will eat different kinds of grass. The sheep graze close and the cattle eat the longer grasses. Cattle eat down the grass so that the sheep and lambs can graze better. Sheep and cattle are not only complementary but the cattle help the sheep in many ways. Hon. Members should see some of my fields that in the past have been very rough, bordering on the hill, where I have had a large number of cattle. Those fields are almost unrecognisable today because they have been grazed down. They look more like permanent pasture.
  Something more is needed in keeping cattle on the hill, and that is a method of keeping them in the winter. They must not winter on the hill, because they would eat the grass which the sheep need. Many hon. Members will know that it is a hard battle to keep ewes going through a severe winter and that they may lose 25 per cent. of their weight from the time they go to the top in November to the time they lamb in April. It is practically slow starvation. Therefore we have to stop the cattle from grazing on the hill, and take the lambs off the ewes so as to give the ewes a chance to put on condition. One has to keep the cattle somewhere else in the winter. It may be possible in some cases to winter them on low ground.
  This is where I want to take up what was said by the hon. Member for West Perth (Mr. Snadden). I did not agree with everything he said—I thought he was something less than fair to the Hill Farming Act—but he made a good point about winter keep. When I have met farmer members of hill farm sub-committees on my tour, I have asked them casually, so that they would not know that I was asking a rather leading question, whether if by some means more winter keep in the form of straw or something of that sort could be distributed
  1568
  to the outlying farms at reasonable cost, we should be able to winter more cattle. Almost invariably the answer has been, "Yes, I believe we could." I want to put this to my right hon. Friend. I do not pretend to know how it can be done, but I believe that we have the straw, that it is not being used, that it could be baled and that it could be distributed. However, there is the question of cost, and the further away the farm is from the centre of distribution, the greater will be the cost. In the national interest we should try to overcome the problem so that we may be able to winter more cattle.
  I now want to speak about wedder sheep. I recently saw what had been a deer forest taken over by the British Aluminium Company, who are big landowners in that part of the country. They have bought the land in order to secure water to provide power for their factory at Fort William. They are very progressive landowners and farmers at the same time, and they are arranging some very big hill-farming schemes. This deer forest has not carried sheep for years. The company are proposing to put wedder sheep—either the wedder lambs when they have been taken off the ewe in the autumn or one year later when they have grown into still stronger and bigger sheep—out to summer in the deer forest. I do not suppose they can be wintered there because it is terribly hard land, but very large areas of the North of Scotland can carry wedder sheep in the same way, provided there is someone to give them a certain amount of supervision, although a regular shepherd is not needed.
  This sort of thing would enable us to put a greater weight of mutton on the market. There would also be an increase in the wool clip. Wedder sheep grow a fleece of about double the weight of an ordinary ewe; their fleeces are colossal. Farmers should be encouraged to use these sheep, for they will get a good return in wool. A wool clip from a wedder hirsel is a very important consideration to a farmer. A wedder sheep may easily weigh 70 lb. I have kept one or two in order to experiment with them and not long ago one sheep killed at about 70 lb.
  I want to say a word about research. I have mentioned before, the enormous

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  need for doing away with disease. On a hill farm of about 1,200 sheep, it is necessary to keep about 250 ewe lambs every year. When these ewe lambs have grown into draft ewes of five or six years old they will probably number 170 or 180. The loss to the farmer will be realised. That may not all be due to disease but many sheep are lost by reason of disease. I endorse what has been said by my right hon. Friend about the excellent work done by my friend Dr. Russell Gregg at the Moredun Institute just outside Edinburgh. Splendid work has been done, but there is a long way to go yet.
  I want to give examples of two diseases. One is scrapie, for which there is no known cure. Most farmers will say on oath that they have no scrapie among their animals, but I often cannot believe that. Those of us who know something about the sheep industry know the incidence of scrapie and the loss which can be caused in one year. There is also a disease known as bracken sickness. It is true that allowing cattle to trample down bracken is one way of destroying it, but that does not achieve very much. I do not know that the sickness is really caused by bracken. We have to find out these things. The disease can cause devastating results. I was talking last summer to a farmer in central Perthshire who put out 10 bullocks on his hill one day and next day six of them were dead through this disease. That man was in not a very large way, and one can imagine his loss.
  I want to speak about the need to hold a proper balance between hill farming and forestry. Both are completely necessary. I told Lord Robinson in the Estimates Committee this morning that when I go on my tours I do the best I can to get over to the farming community the needs of forestry. There is a considerable amount of misunderstanding and far too much criticism of the Forestry Commission on the part of the farmers. It is not all justified, but some of it may be a little justified merely because of the way the Forestry Commission have gone in and taken over land and held the land from being farmed. I do not know but there is a degree of criticism, and we want to build up more goodwill between forestry and hill sheep farming to the greater profit of both.
  5.58 p.m.
  Lady Tweedsmuir: I hope that the hon. Member for Accrington (Mr. Scott-Elliot) will forgive me if I do not follow him into the intricacies of hill farming. I learned a great deal from his fluent and interesting speech. I want to speak about one aspect of food production which has already been touched upon by the hon. Member for Streatham (Sir D. Robertson), our fisheries, and I shall relate my remarks particularly to Chapter 9 of the Scottish Report. In paragraph 109 we are told of the increased financial assistance which is available to fishermen under the White Fish and Herring Industries Act and the Inshore Fishing Industry Act, but later in the chapter we find that, taken all in all, very little advantage has been taken by the fishermen of this assistance. We find that in 1948 not a single new boat was added to the Scottish fishing fleet. In Appendix B we see that the number of boats available in the fleet is still very low on the whole.
  One wonders what is the reason why the fishermen of Scotland are not showing their usual drive and initiative in building new boats and expanding their production. I believe that what was said by the hon. Member for the Western Isles (Mr. M. MacMillan) and the hon. Member for Streatham is one of the main reasons, that they are finding that their excursions into the fishing grounds are becoming less and less profitable. Paragraph 103 of the Report says that a marked scarcity of fish on the usual grounds accounted for the decline in the total earnings which were 16 per cent. less than last year. I should like the Committee to be told whether the countries which did not ratify the International Fishing Agreement have now done so and whether it is considered possible to carry out this agreement in a practical way. It is of the utmost importance to the industry. I suggest that what is exercising the minds of all those engaged in this major industry of Scotland is a feeling of acute insecurity as to the future of the industry as a whole.
  In that connection I want to speak for a few moments about some particular problems which confront my own constituency, the fishing port of Aberdeen, and which I think confront also all fishing ports in the North. When one talks about the difficulties, one has to look at

  1571
  the matter realistically and admit that one wonders whether it will ever be possible for the fishing port of Aberdeen and those in the North to compete economically on equal terms with the great fishing ports of the South, such as Fleetwood, Grimsby and Hull. One has to consider that these latter are close to the coalfields and live on the doorstep of huge consumer markets. There is also the important and vexed question of transport charges. The only physical advantage which Aberdeen has is that it is 24 hours steaming time nearer the distant fishing grounds than the Southern ports.
  Mr. Boothby: May I interrupt my hon. Friend for one moment? Would she make it clear that she is referring only to the white fishing ports and not to the herring ports, because we can compete with the English?
  Lady Tweedsmuir: I would not venture to enter into the arena so ably held by the hon. Member for East Aberdeen (Mr. Boothby). However, I think one must admit that the Government, and through the Government the consumer, will always to a certain extent subsidise our fishing industry in the North. I personally think that is an absolutely justifiable policy. It may well be said that surely no one on these benches will make special pleas for industries which, owing to their geographical disadvantages, are uneconomic. That would be a strange policy to pursue, but I maintain that there are certain cases as they affect the North where it is a justifiable policy. As regards the fishing industry of Aberdeen, I would say that it is justified not only because presumably the Secretary of State wants to keep employment in the North, not only because he wants to keep going many important ancillary industries, and not only because he wants to stimulate the production of a valuable protein food. I would say that there are far wider considerations even than that, and those are considerations of strategic importance.
  After all, in our island we have a peculiar situation. We are extremely vulnerable, we support 47 million people, we have to import a great deal of our materials, but in time of war we are subject to blockade by sea and by air which makes it absolutely vital that in time of peace we try to stimulate and keep going certain industries which otherwise
  1572
  would be uneconomic. To take an example nearer home, I would evidence the jute industry of Dundee which, the Committee will remember, before the war could not economically compete against what was then India in either scope or cost. Nevertheless, it was seen fit to keep the industry going for strategic reasons alone. The same applies very much to the fishing industry in the North East of Scotland. In that connection it is perhaps an encouragement to see that at least one of our major research stations, at Torry, in Aberdeen is getting on well, and from the Report I see that due tribute is paid to it and that the work is progressing so that it will shortly expand further. It has done a great deal, not only in research on the processing of fish for the home market but also for export.
  When we talk of strategic considerations, we speak from the long-term economic planning point of view, as the Secretary of State has mentioned. We think, therefore, not only of the subjects I have mentioned but of the ships themselves and of the men who man them, who are so vital to us in time of war. I think it was Conrad who said that it is not the ships that count, so much as the men who are in them; the men who are the backbone of our navies in war—famous characters such as Iceland Ted and Bear Island Bert—men who, through their toughness and resiliency, have made the name of this country famous throughout the world. Therefore, when one makes this plea for some special consideration being given to an industry which has great physical and geographical disadvantages, one does not plead just to safeguard the interests of a certain port but because one feels that special consideration will give great benefit to the nation as a whole in the end.
  In that connection, I would like to refer to a subject of which the Secretary of State is already well aware—namely, the great difficulties with which we in the Port of Aberdeen are confronted in the transport charges, and their effect on the industry. As the Committee knows, during the war price control was put on fish and there was also a flat carriage rate for fish. The two were considered interdependent and were embodied in the Fish Sales (Charges) Order. One does not challenge the repeal of this Order when the consumer is no longer in need of being protected by price control, but

  1573
  one does advocate that some method should be examined of equalising transport costs. I know quite well that this is a vexed subject because a flat rate can work both ways. In a free market it can adversely affect certain traders, and I know that our own Chamber of Commerce is much divided on its merits.
  However, I would like the Secretary of State to consider one or two points. Aberdeen is the most important fishing port in Scotland. Of all white fish landed in Scotland it provides 74.5 per cent. and in the City of Aberdeen, of those people gainfully employed over 20 per cent. derive their livelihood from the fishing industry. Nevertheless, they are confronted by the extreme difficulties of being far from the coalfields, far from consumer markets, and having in normal times of peace to confront long haulage and high transport dues.
  Take, for instance, the effect on the industry of the transport of coal. In 1948 the Aberdeen fleet of 193 trawlers and liners burned 6.5 tons a day on an average working year of 290 fishing days. In 1938 the fleet, which was then 279 trawlers and liners, burned 5.5 tons a day on an average working year of 320 fishing days. I am informed by those who know the subject that the increase in the amount of coal used for less boats and less fishing days has been largely due to the poor quality of coal—which is not the responsibility of the Secretary of State. The average cost f.o.b. trawler was 79s. 10d. a ton at Aberdeen as compared with 58s. 6d. a ton at the Humber ports, which is a disparity of 21s. 4d. a ton. This casts a heavy extra burden on each ship of £2,118. In other words, the cost is 41 per cent. higher in Aberdeen than in the Humber ports.
  Of course we have certain local difficulties such as the bunkering facilities, which are admittedly poor, but these are being improved and it is hoped that by this means, the price per ton of coal will be reduced by 2s. 6d., but even with that reduction the price in Aberdeen is still 32 per cent. higher than in the Humber ports. Of course, the Aberdeen fishermen and owners have endeavoured to overcome these difficulties by trying to transfer to oil-burning ships. That, of course, involves the great cost of building, added to which there is a general feeling of insecurity in the industry and the high
  1574
  cost of the transport of oil. There is, in fact, a difference in cost between the northern and southern ports of 12s. 6d. a ton, or £795 a year for each oil-burning trawler, which means that these costs to Aberdeen for fuel alone, are 32 per cent. higher than in the South.
  Then there is the cost of the distribution of the fish. It is calculated that of all the fish landed in the port of Aberdeen, 75 per cent. is distributed to markets in England and Wales. I shall not worry the Committee with long lists of charges, because hon. Members will not be intimately interested in them, but I wish to put before the Committee two main features which are of striking importance. The disparity of prices between the southern ports and the port of Aberdeen in the two years preceding the war amounted to a loss to the owners of £149,950, and to the fishermen of £37,610. Then, of course, there are other local considerations, such as the transport of ice in large quantities and the return of empty boxes, which in the Humber ports is 3d. or 4d, a box but in Aberdeen is 7d. a box. All these things added up amount to very real difficulties which must, naturally, affect any expansion of the fishing industry in what is the main port of Scotland and is, I am sure, the Secretary of State's major concern.
  It has been proved that the high transport charges make it uneconomical for our boats to operate in the distant fishing grounds of the White Sea, Bear Island and the Norwegian coast. In any building programme, therefore, Aberdeen has concentrated rather more on the smaller boats. The Secretary of State will be aware from his visits to the city that many boats are in need of modernisation—many, indeed, are fit for scrapping—and that the new programme of building should be expedited. The only factor of any great advantage is that through fishing in near and coastal waters Aberdeen has secured a reputation of landing prime quality fish, to the great benefit of the consumer. I only hope that this reputation will continue when the policy of "fish at any price" goes by the board.
  During the war, therefore, it was seen that the industry was kept on a firm footing, not only because of the peculiar conditions of war but also because of the equalisation of transport charges. But with the possible return to normal rail

  1575
  rates, a very serious situation is presented. It must be remembered that transport charges generally have gone up by 50 per cent. since before the war. If we add the transport costs for fuel and also local haulage rates, these figures, based on the 1937 earnings of our fleet, represent a loss per vessel of £3,346. In a memorandum on this subject, which I think the Secretary of State has studied, and which is supported by all sides of the industry in Aberdeen, it was said that with the co-ordination of road and rail transport it was expected that road and rail charges would come into closer alignment, and that a steep rise in both was shortly to be expected.
  Although the people of the North of Scotland are second to none in tenacity, industry and vigour, these obstacles make it almost impossible for them to maintain the industry on a stable basis. They are very willing to do their best but against these factors they face a most difficult time unless the Secretary of State can give close consideration to this problem and give our people that reasonable degree of security which is all that they ask.
  I ask the right hon. Gentleman, therefore, to examine this problem at the highest Cabinet level with all the Ministers concerned—of Food, Labour and Transport. It has been said that the Fish Sales (Charges) Order is not to be rescinded immediately, but when it does go, the flat rate automatically goes also. We still have a little time in which to act, and I suggest that now is the time to get all sides of the industry together to see whether some agreement can be arrived at. I know very well the opposition of the southern ports, which do not see why they should subsidise those which are further afield geographically in order to compete with them. If this matter were examined at Cabinet level, I feel sure it would be possible to get all sides of the industry, North and South, to come together and, perhaps, to reach some agreement for the benefit of the community as a whole from a strategic point of view.
  The Secretary of State will know that he has behind him all sections of the fishing industry in Aberdeen, including the owners, skippers and mates, fish merchants and curers, and the fishing section and the fish workers' section of the
  1576
  Transport and General Workers' Union. He has, therefore, the fullest support of what is really one of our major industries of Scotland. I trust that he will be able to give this matter his personal attention at Cabinet level while we still have time. Lastly, I would remind the Committee that when we talk of the fishing industry it is to these men that the country always turns for their fortitude, skill and endurance in time of need. They have never let us down. It is for us, therefore, in time of peace to give them a fair chance, for the nation is for ever in their debt.
  6.20 p.m.
  Mr. Woodburn: My hon. Friend the Joint Under-Secretary may not be able to deal with all the points raised by the noble Lady the Member for South Aberdeen (Lady Tweedsmuir) when he replies to the Debate. I should like, therefore, to assure the noble Lady that all that she has said has been under consideration. The Minister of Transport and the Transport Commission are conducting an investigation into the question of differential rates. One of the problems which arises is whether it is the Transport Commission which should indulge in subsidies of that nature or whether this should be undertaken by the nation as a whole.
  The other points which the noble Lady has raised are very much in our minds. On the question of building boats, for instance, the noble Lady will know that a Bill is now in course of passage. I assure her that this matter has been under consideration and that, although quite a number of snags exist, we are pursuing it as best we can. I understand it will take about two years before the Transport Commission can possibly take over the task of rate fixing and charges, but I hope that before the expiration of that time they may be able to do something in the direction the hon. Lady has suggested.
  Lady Tweedsmuir: I thank the Secretary of State for intervening to make that statement, which will be a great encouragement to the fishing industry in the North. I hope, however, that the two years of delay of the Transport Commission in getting these matters solved will not mean that, if the Fish Sales (Charges) Order is rescinded before that date, no alternative solution to the transport problem has been found.
  The Deputy-Chairman (Mr. Bowles): Mr. Malcolm MacMillan.
  Mr. Malcolm MacPherson: May I at the outset raise a point of Order? I should like to make a number of remarks on transport in Scotland. Will that he in Order in this Debate?
  The Deputy-Chairman: I called the hon. Member for the Western Isles (Mr. M. MacMillan).
  6.24 p.m.
  Mr. Malcolm MacMillan: I hope that my right hon. Friend the Secretary of State for Scotland, who has expressed such genuine sympathy with the agreed and very real difficulties of the constituents of the noble Lady the Member for South Aberdeen (Lady Tweedsmuir), will be alive to the difficulties, which are manifold and as great, of the people in outlying places like the Western Isles.
  Mr. Woodburn: May I assure my hon. Friend that what I have been saying about the investigations is not confined to Aberdeen, but concerns the whole Highland area.
  Mr. MacMillan: I appreciate that, but sometimes the "whole Highland area" has been considered, even spoken of in terms of millions of pounds, and yet the little places are apt to be forgotten. I shall cite one or two instances of that, with your permission, Mr. Bowles, today. Before doing so, I wish to congratulate the Secretary of State on what I thought an excellent speech and an excellent exposition of the party's policy and the progress made under his Departments and under his guidance. It was a most impressive array of facts which were not disputed even by interruptions of hon. Members opposite. It was good to hear them, even though many of them were a repetition of things known to hon. Members on this side of the Committee. I do not wish to criticise any of the general statements made by my right hon. Friend; but rather to say that he has the wholehearted support of all hon. Members on this side of the Committee in so far as he has attempted to implement the policy of the Government in the agricultural development of the country, which has been neglected for so long.
  The hon. Member for Streatham, Caithness and Sutherland or for Caith-
  1578
  ness, Sutherland and Streatham—although Streatham would not like it that way—told us that no other Government had the opportunity which this Government had and he gave us almost no credit for the astonishing and great things which had been done in agricultural development in the last few years. Surely that was most ungenerous and quite uncharacteristic of him. This Government certainly had the responsibility for doing these things which were left to them as a legacy of neglect, but to say that no other Government had the opportunity, is to talk arrant nonsense and to shed from his own party that responsibility which this Government have so gladly taken on. May I quote from that great Tory agricultural crusader, Lord Beaverbrook?
  Colonel Gomme-Duncan: Tory?
  Mr. MacMillan: An ex-Tory; he has supported the Tories at different times, although I do not know just what the relations are at the present moment. His voice is in this editorial of the "Daily Express" as saying:
  "In the Tory Party's Empire manifesto there is one splendid declaration. It appears in bold, black type on page 32.
  Here is the policy of wisdom, but of wisdom how long delayed. But if this is the self-same policy which the Empire crusaders preached day in and day out in the early 30's, it is the identical policy which the Tories fought and denounced for years. Look back to those years when the Empire crusaders stumped the country and fought by-elections and always the cry was 'The Tory Party put Britain first.' That was the call against which the Tories put their weight and a Tory Prime Minister took time off from State duties to fight it."
  The denunciation goes on:
  "If only the Tories had listened in 1931 and adopted this policy."
  Lieut.-Colonel Elliot: Would it not be more appropriate if this was given in evidence before the Press Commission?
  Mr. MacMillan: Even for the right hon. and gallant Member, that is an appallingly feeble gag. I expected something of note to emerge from such a colossal gesture as an interruption by him. The hon. Member for Caithness and Sutherland in attacking the Government, incidentally to his attack on the Liberals, painted a picture that showed little gratitude for what the Government are doing in Sutherlandshire. People

  1579
  there acknowledge that the Government have transformed the face of that county agriculturally. The hon. Member forgot to point out that the whole decadence of that county, the whole agricultural deterioration, the rural de-population of Sutherlandshire, was to be laid entirely at the doors of the Tory landlords, who evicted the people from Caithness and from Sutherland. That is not so very long ago. I do not see why the hon. Member for West Perth (Mr. Snadden) should feel happy about that. Certainly, it made a little more room for the bigger farmers, but it was something to be ashamed of rather than something from which to draw credit or consolation.
  Only the other day I was reading Donald McLeod's letters to the Press at the time he wrote his "Gloomy Memories." He told us of the burning by the Highland landlords in Sutherland of more than 250 of the crofters homes, without any thought of their future and of their settlement elsewhere. It is a callous history and I am rather shocked that the hon. Member should stand up here and, ostensibly representing Caithness, though without a mandate, not feel ashamed of the history of his party and of his party's Governments of the past.
  Mr. McKie: On a point of Order. The hon. Member for Western Isles (Mr. M. MacMillan) made a joking start by attributing to the hon. Member for Streatham (Sir D. Robertson) the constituency of Caithness and Sutherland. Having made the joke, would it not be proper for him now to refer to the hon. Member as the hon. Member for Streatham?
  Mr. MacMillan: I am sure it would give Caithness just as great pleasure to refer to him as the retiring hon. Member for Streatham who is not likely to be the hon. Member for Caithness. I am not one who has forgotten to criticise the Secretary of State. Indeed, I have sometimes been accused of being more critical than hon. Members opposite. Whether I should claim that or not, I can do so without much danger of being contradicted even by the hon. Member for Galloway (Mr. McKie) till he has recovered from moving one of his famous points of Order.
  In these four years we have seen the condition of the people, especially in the
  1580
  Western Isles completely revolutionised in many respects. The old people in the rural areas are being looked after as they have never been looked after before, after a life in which they enjoyed very few of the comforts and benefits or wage standards of people in industrial towns. There is no hunger now in the old Tory sense of the pre-war days, no real hunger, and there is no poverty at the old level we knew not so very long ago in the rural areas of Scotland. The children are being cared for in a way they were never cared for in the days we can all remember when we were begging in this House for two or three shillings a week for them to be looked after while their parents were unemployed.
  The conditions of the farmer and the farm worker have very greatly improved and there is no comparison with the years to which Lord Beaverbrook's "Daily Express" refers in the editorial from which I have quoted. The hon. and gallant Member for Perth (Colonel Gomme-Duncan) seems to regard Lord Beaverbrook as something unmentionable. I can assure him on the authority of Lord Beaverbrook and his Press, that he regards the hon. and gallant Member and his friends as unmentionable in regard to agriculture. The right hon. and gallant Member for Scottish Universities (Lieut.-Colonel Elliot) once placed a malediction on the scientists and cursed them because they were "making two blades of grass grow where one grew before." I do not know whether he is willing to retract those words now, but he deserved, and got, not too much credit in those days, either from Lord Beaver-brook or the farming industry, when his active policy was to restrict production and keep prices high against the consumer.
  I wish to say a word about the fishing industry. Here, again, wherever it has been possible to operate the Herring Industry Board schemes, stability and a sense of security and a good deal of prosperity have followed the activities of the Herring Industry Board. At Lerwick for some years, and now, at Stornoway, where the Board's schemes have got under way, they have revolutionised the industry and greatly enhanced stability and security. There are one or two exceptions to this picture of increasing prosperity—places where the Board has not gone, and I draw the attention of the

  1581
  Secretary of State specifically to these in order to get him to make an approach, and I do not see why he should not personally do so, to the Herring Industry Board.
  Let us consider the Island of Barra and the Uists. The hon. Member for Streatham (Sir D. Robertson). talked about the waste of good food that goes on. What a shameful thing it is to see great shoals of fine rich, nourishing herrings such as even Aberdeen could think of competing with, simply not being caught while we are being warned at the same time by Sir John Boyd Orr and other great authorities that the world can look forward to hungry lean years for possibly some decades. Surely, something can be done? These Uist and Barra men are anxious and willing to go out and catch the herring, the boats are there, as at Stornoway and other ports, but if they catch the herring how are they to dispose of them? There are no local buyers; there is no Herring Board scheme in operation out there. The men either have to go 100 miles to Stornoway with the Board's permission, with their catch of herring, and try to sell them to the Board at the port maximum price or else go across the Minch to Mallaig and find when they get there that they get only the fish meal price, which is little more than half what they would get if the fish were sold for human consumption. It seems shocking that we are not able to help these people to catch the plentiful supplies of the rich valuable fish which are seething in the water off Barra and the Uists and which the men are eager and willing to catch.
  I ask my right hon. Friend to approach the Herring Industry Board and see if they cannot at least send the klondykes or fish carrier vessels to buy on the spot at the same price as at Stornoway and other places. We cannot just abandon this fishing community. Castlebay port used to be one of the most important of the West Coast fishing and curing stations. Across its harbour, one could walk dryshod over the decks of over 500 boats. They came from Stornoway, the East Coast, from England and elsewhere; and the curers used to come along with their salt and great loads of barrels and they sent out their products in hundreds of tons to Russia, Poland, Germany and the Baltic States. These markets have gone and Barra does not expect that
  1582
  we shall get the cured herring market back on the old scale. But some of the advantages of the new processing methods could be brought to bear on the problem of the Uists and of Barra.
  I imagine that the hon. Member for East Aberdeen (Mr. Boothby) intends to remind me that the old matje market should be revived, so I hasten to agree with him before he says that. He has done a great deal to try to revive that market and has in this House tried with the support of some of us, to persuade various Governments to try and revive it. No effort has been made, however. One of the directors of the Anchor Line shipping company, who was at Stornoway some time ago, confirmed what for many years the hon. Member has been saying, and with which others agree, that there is a demand in Canada and America for the Castle Bay matje herring if we could get them economically across there. That demand still exists and people, I believe, are willing to pay the enhanced prices.
  It seems such a frustration of people and of Providence to find the water seething with fish but that the men of Barra are not assisted to get the full food price except at Stornoway with a permit from the Herring Industry Board, with the Food Ministry doing its worst to discourage even Stornoway and divert activities to the mainland's less suitable ports, farther from the herring shoals. I invite the Secretary of State to listen to this point and do something about it. To waste such valuable food is a shameful frustration of men who are willing and able to catch the fish.
  The Government have been generous in the matter of assistance for new boats and gear by making loans and grants for this purpose. I only wish that all the islands had harbours suitable for new boats. I wish I could say that the men and even the insurance companies felt safe in putting new and costly boats into some of the neglected harbours on the West Coast. I ask my right hon. Friend to have a look at harbours and some of the smaller piers and jetties, especially in the smaller isles.
  Another aspect in considering the waste of food is that when we make a trade agreement with Russia there is thrown in as a sideline the importation of crab into Great Britain—3s. 9d. for a three

  1583
  ounce tin. Yet I have seen thousands of crabs the size of a saucer or plate thrown overboard, thus providing the possibility of them coming up again and spoiling the lines and nets of the fishermen. Hundreds and thousands of such crabs are being thrown overboard while we are paying 3s. 9d. for a three ounce tin of Soviet crab. In the present condition of the world I do not think that any other country would tolerate such a waste of valuable food. Then, too, if one bought English crab in London one would probably pay 3s. for a small portion.
  To utilise that herring and crab there is no need to use dollars; there would be no drain on gold, no question of foreign exchange; no demand for our coal or generating plant. These things can be obtained off our own shore. It is perfectly feasible to give some practical help and take what Providence is throwing at us in tremendous quantities while people are paying high prices for small quantities of imported crab and other foods.
  I now turn to transport and roads. I do not intend to challenge the general figures which the Secretary of State gave us. I agree that there are great projects for trunk roads in the Highlands; that there are "projects for projects," great plans for more great plans. For years I have listened to figures up to £80 or £100 million. I know the plans are there, I know that these things will, in time, materialise; but what is the answer to a man of Eriskay, an island of 300 people who cannot use a wheelbarrow among them because the Scottish Office cannot make up their minds about spending a few hundred pounds to put some sort of road on which the people can wheel a barrow. There has never been a wheel on Eriskay—except one lorry which got bogged—and never will be at the present pace at which their problems are being approached.
  I turn next to the Island of Scalpay in Harris. When the speech of the Secretary of State is heard there tonight on the radio how will a reference to the millions to be spent over so many years impress men and women who have to carry all their goods from the pier to their homes two or three miles away, like pack animals? While he talks in millions and the future, we have been pressing the authorities for years to give us a
  1584
  decision about minor but urgent assistance in terms of hundreds or a few thousands of pounds and we cannot get a decision even on that. The same applies to the need for a jetty for Bernera of Harris.
  One can go to the Island of Vatersay, which is owned by the Department itself. Yet the Department is only planning the provision of a road for that hardy community of fishermen who have asked nothing but that the Department, as proprietor for over 40 years, should make a start on a road and a jetty, and on all the things which have been on paper for so lone, and which are still so hopefully on paper at the moment. But when are we to see a start made on these projects? When I go to Bernera, off Lewis, I am on an island of 600 people for which we have for 14 years pleaded in this House on countless occasions—from whence no fewer than seven men from one home went into the Merchant Navy and the Navy during the last war; an island from which almost every able-bodied man was shamelessly taken by a Government and nation which had neglected them for generations. The people on that island have to carry on their backs everything that comes into the island. They have to carry everything up and down the rocks and then two or three miles to their homes because they have not a bridge or a road which has been promised to them for three years, a complete survey for which has been made; but for which we cannot get an ounce of steel.
  What is my answer to them? The £100 million scheme for the mainland is all right; but what about a decision now on this small thing? It is all very well to talk about the big and distant and slow schemes; but we must bring into effect these small things to meet the real and urgent needs of these small communities. I invite the Secretary of State to give us an undertaking that some policy statement will be forthcoming which will include a definite decision on the finance and the materials for the carrying out of these small schemes in the very near future. Can we have if, after four years asking, before the Recess?
  Mr. Woodburn: My hon. Friend will agree that in an area covering half the land surface of Scotland it is easy to

  1585
  pick out some bits which have not been dealt with, and I invite him to look occasionally at the places that have been dealt with. No Government can deal with these projects; it must be done by labour in the Highlands. If there is not enough labour to do the work it must wait until the labour is available.
  Mr. M. MacMillan: That answer is completely unrealistic; it is completely wrong. It is a stock Departmental dodge. I could get the labour in the Islands and would promise it to the right hon. Gentleman now. I am not responsible for carrying out the work, but if I were in his shoes I would see that the labour was provided one way or another where men are now idle. It is up to the right hon. Gentleman, and the Minister of Transport, and the other Government Departments responsible to see that these schemes do go on. Labour trouble will not stop them, if that is their only excuse. For year I have been promised these projects. Within this Government's term, I had a promise of 60 per cent., plus 25 per cent. of the cost of constructing a bridge at Bernera—promises from Cabinet Ministers—where conditions are such as would not be tolerated in Stirling and Clackmannan, or in the constituency of any other hon. Member, without a public outcry and a sensational scandal. These people have to put up with this because of their remoteness, and because of the utter failure to obtain a decision from the Departments and officials for which right hon. Gentlemen are responsible.
  I have already said that I am conscious of the bigger things which are being done; but I wish attention to be paid to these places where people are living in small existing communities. Let us get a hundred small decisions implemented. Better action now than promises of great future schemes. Let us have something effective done now rather than the promise of some great things in 20 years' time. I am weary and tired of waiting for the fulfilment of promises made by previous Governments and by certain hon. Members of this Government. I shall not mince my words merely to satisfy the vanity of any Minister. That does not detract from what I said earlier, that I appreciate the things which are being done. I appreciate the difficulties of the right hon. Gentleman whose problems are a legacy from other Governments. But I have lived
  1586
  with these problems and with the people who have to face them. They are not being faced by the Government and I think it high time that they were faced. We have pledges of our Ministers to keep and they must be honoured now.
  6.44 p.m.
  Mr. Boothby: I have a sincere sympathy for the hon. Member for the Western Isles (Mr. M. MacMillan) in his plea that we should get a few small decisions, and that some action would be very much more satisfactory than a very large number of very large promises of action over a considerable period of time. There are so many of these bigger and better schemes costing £100 million on paper; but some of us could do with a few hundreds quickly in cash, and that applies particularly to the Western Isles.
  Speaking as a representative of the Buchan fishing ports, I can say with all sincerity—and it is a serious and solemn statement to make—that the Castlebay matje herring is without any question the best herring in the world. I have to concede that to the hon. Gentleman. This herring is caught only at certain times of the year. It is very fat and very succulent. It has to be cured in a special way, and eaten raw it is quite delicious. I think that perhaps it is the most succulent fish of its kind in the world. It commands a high price in the United States, and I know that they are ready to pay that high price.
  What the hon. Member said about the Anchor Line was interesting. On the continent of Europe they will also pay a high price for it; and I can never quite understand why more energetic action has not been taken by the Herring Board to revive the Castlebay fishing, and to make the differential price for this particular herring. I wish that the right hon. Gentleman would look into it, because there has been some difficulty about making a special high price for this herring; but if the Americans are willing to pay that high price, why should we not charge it? Then the fishermen would go and fish in Castlebay at the time when the herrings are there.
  The other part of the problem posed by the hon. Member for the Western Isles would be solved by the construction of a quick-freezing plant, or some other kind of freezing plant, in the Western Isles.

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  Otherwise it is impossible to get the herrings to the mainland in a fresh condition. It would be well worth while to put a quick-freezing plant at Stornoway as soon as possible.
  I saw a film last night which filled me with a nostalgic longing for the Isle of Barra, one of the most beautiful islands in the constituency of the hon. Member, and which he knows that I know pretty well. The title of the film was "Whisky Galore"; and it was very beautiful, and very exciting. The hon. Gentleman may try to assure us today that this island is booming and full of food, although even he can hardly claim that it is full of whisky at the present time. But he knows that the island has not the prosperity it had, even in the years between the wars; and I think that the departure of the herring fishing is largely responsible for that. I ask the right hon. Gentleman to direct the attention of the Herring Board particularly to the Island of Barra, not on account of the film, but on account of the herring.
  The speech of the right hon. Gentleman himself was certainly very remarkable. I was glad that he paid a tribute to my right hon. and gallant Friend the Member for the Scottish Universities (Lieut.-Colonel Elliot) for his work as Minister of Agriculture, which has always been under-estimated. My right hon. and gallant Friend was very rough to me once when he was Minister of Agriculture; but I have always maintained that he was about the best we have ever had. If only he had taken my advice about oats, he would never have gone wrong. But he left out oats. That was his trouble. However, he did very well by all the other marketing schemes; and when they are discussed I always think that the right hon. and gallant Gentleman should be mentioned, because he really was the architect of most of them, and it was nice of the Secretary of State to refer to him.
  The right hon. Gentleman went on to paint a picture of rural Scotland as a veritable Eldorado on which it would be virtually impossible to improve. At one point he became absolutely lyrical in his enthusiasm, and abandoned the realistic, pedestrian atmosphere of this Committee to soar to the heights of imaginative poetry. The picture of those sheep, after those wonderful meals of turnips they had
  1588
  had in the low ground, wandering up through plantations of trees—especially arranged for their benefit by the right hon. Gentleman—in order to have a final look at the sunset before retiring to rest, will long remain in my memory. It was an idyll which the Secretary of State presented to us; and I was wondering whether there was going to be any flaw, or any tiny note of dissatisfaction. Not for a second. Right through to the end the sustained joyous enthusiasm and gaiety was kept up. I would, however, beg the right hon. Gentleman to abhor the vice of complacency. Scotland is a pretty good country we all know, but it is not as good as all that; and if the right hon. Gentleman thinks that it is we shall soon be looking for a new Secretary of State because it will not do at all. Complacency is one of the worst faults a Minister can have; and the right hon. Gentleman can hardly deny that his speech was not only complacent, but optimistic to a point that I have seldom heard in any other speech made by a responsible Minister of the Crown.
  We have to face the staggering fact that in this country the production of meat has fallen very substantially as against the pre-war level when we want meat more than at any other time in our history. The causes are well known and I will not labour them. There was the necessary emphasis on cereals during the war; the tremendous emphasis on milk in the closing stages of the war and immediately afterwards—over-done as many of us think—and finally the lack of feedingstuffs; to which we on this side of the Committee have drawn attention continuously for the last three years, and which has at last been grasped by hon. and right hon. Gentlemen on the Treasury Bench. But despite all these causes, the pick-up in the meat production of this country during the past two years has not been anything like as great as it should have been. I do not think that the right hon. Gentleman has any cause for complacency merely because the Scottish figures are a little bit better than the English figures, which are disgraceful. We ought to be producing a great deal more beef, mutton, bacon, poultry and eggs than we are producing at present, and we could do it.
  The right hon. Gentleman introduced what is known as the calf subsidy the

  1589
  other day. I was critical of it at the beginning but I am now inclined to revise my view, because I think that it has given some encouragement, particularly to the smaller men; although, as the hon. Member for West Perth (Mr. Snadden) said, it is apt to get into the wrong hands, and I do not think that it can possibly be regarded as a long-term solution to the problem. It is an emergency measure. I am sure that it should be accompanied by a greater premium on quality, a greater incitement and encouragement to quality. In addition, we should never have allowed so many Irish store cattle to be diverted away to Holland and Belgium by the offer of higher prices. That was the cause of the trouble. The right hon. Gentleman is right in tracing one of the major causes of our present trouble to the lack of Irish stores. But they were there. They did not all die. They went to Holland and Belgium instead of coming here, because Holland and Belgium paid a higher price for them. We made a great mistake. We ought to have put our hands in our pockets and paid for them. It would not have cost any dollars, anyway.
  The subject of marginal land has been raised at great length by experts on both sides of the Committee who know more than I do about it. But I have seen one figure which I think is pretty shocking. I do not believe that even the Secretary of State, in all his exuberant and joyous optimism, can be completely satisfied with it. There were 795 schemes put in and 68 formally approved. That is not really too good, whichever way we look at it. I think that many of the schemes will not turn out to be financially satisfactory. This is costing too much. The Secretary of State is putting too great a burden——
  Mr. Woodburn: The hon. Gentleman says that, and then he proceeds to say that it is due to the carefulness and wisdom of the Department in not passing schemes which are not satisfactory. He says that those approved are very risky.
  Mr. Boothby: They are risky only because of the lack of generosity by the Government. The Government are not spending enough money on the development of marginal land, in view of our present emergency, and in view of the money they are pouring out on other
  1590
  projects. Just think of groundnuts and think what we could do in Scotland, where we do not have any droughts—at least we do not have any Kongwa droughts. Just think what the Government could have done to the marginal land in Scotland with a quarter of what they have spent on scratching around in Kongwa and getting nothing at the end of it. I am not in principle against the groundnut scheme; but when I see the money which has been spent and compare it with the amount of money we are prepared to spend on the development of marginal land in this country, I think it is cock-eyed, if I may use the term, and out of proportion. Here is a field where it really would pay the Government to spend money, because it would give an immediate return in the most valuable form of all—food, which is what we want from every point of view at present. There would be no loss of gold or dollars. Therefore, it would have a direct impact on the fundamental problem of our balance of payments.
  If Scotland were a Colony, the Government would spend more on it. I have often said that if Scotland had been a Crown Colony, a great deal more money would have been spent on it in the last 50 years than has been spent, particularly in the Western Highlands and Islands. They have been allowed to linger and maunder into a state which if it had been Kenya or the Gold Coast would never have been tolerated for one second. There would have been 20 Parliamentary Commissions going out to investigate and report. The Highlands and Islands and tae marginal land of Scotland have not been developed adequately over the last 20 or 30 years. There is no doubt about that. There was some reason for this when there was a glut of food in the world, as there was for about 20 years. There is no reason or excuse for it today when, so far as we can see, for many years to come we shall want all the food we can possibly lay hands upon—particularly food grown inside this country. Therefore, I say that if the Government took a bold view and pressed on with marginal land development, it would be a most excellent policy.
  I spent some part of the Parliamentary Recess moving about in a very interesting country, the country of Denmark. I was amazed at the agricultural recovery which has taken place there in the last

  1591
  two or three years. They suffered things that we did not suffer. They were occupied for five years by the Germans, and we were not so occupied. Their livestock was seized by the Germans. They were indeed gutted of livestock, and that did not happen to us. I have no hesitation in saying that their agricultural recovery has been greater than ours, proportionately, over that period of time. This is even more remarkable in view of the fact that the average size of a farm in Denmark is much smaller than in this country, and the number of smallholdings is far greater.
  I should like to recapitulate some of the points which struck us most there. I think all my colleagues on the Parliamentary delegation would agree with me about this, because we had a most interesting trip. First, we were struck by the general economy of the farms. It is fearfully good. Nothing is wasted. Secondly, the excellence of the farm buildings. They are better on average than those we have in Scotland. Thirdly, the quantity and quality of pigs and poultry which is greater than we see on the ordinary average Scottish farm. Fourthly—and this is important, I think—concentration on products most suitable to a particular district. They attach great importance to this, as I do. It is frightfully important, as my hon. Friend the Member for West Perth said, that the dairy country should concentrate on producing milk and dairy herds and the beef country, like the country I represent, should not try to go in for milk production on a large scale but should get on with Aberdeen Angus, which thrive best of all in their natural native country, which is the north-cast corner of Aberdeenshire. We ought to concentrate on maximum beef production in the beef-producing areas and maximum milk production in the milk-producing areas. That is what they do in Denmark.
  Fifthly, we noticed that there was electricity everywhere. I admit that the Secretary of State had a case there. The hydro-electric scheme which we all support has already done tremendous good in the country districts of Scotland and it is likely to do a very great deal more good in future. Sixthly—and here again they are far better than us—they have made the most strenuous efforts to increase
  1592
  water supplies for all their farms, particularly in South Jutland, where the water is brackish and undrinkable owing to the incursion of the sea. There it is a very difficult problem which they are tackling with an immense vigour and upon which they are spending a great deal of money. Finally, we noted their system of co-operative marketing, which is really remarkable, and much better than we have here. There is far more effective co-operation between the producers than we have, except perhaps with regard to the marketing of milk.
  My hon. Friend the Member for West Perth asked rhetorically what was the long-term policy of His Majesty's Government, and the Secretary of State gave us this rhapsody in reply. It was all right, but it did not really get us very much further on the question of the long-term policy. Has he any ideas about establishing a Meat Marketing Board on the lines of the Milk Marketing Board? And has he any views about getting a better regional distribution of centralised slaughterhouses and processing centres than exists at present? They certainly have a very much better system in Denmark than we have in Scotland. Of one thing I am absolutely certain. I do not want to be dogmatic, and I do not pretend to be dogmatic when I say that our present methods of marketing meat require the most careful examination and reconsideration, in the light of post-war conditions.
  I do not think that the Lucas Committee found the answer to this problem. The general structure of the guaranteed price must in all circumstances be retained. But, if the Government will not give an adequate premium for quality, there is something to be said for letting the wholesalers bid for it. They know a good piece of meat when they see it and they might bid to a point which would encourage the farmers to go in for breeding the best quality. [An HON. MEMBER: "They did not do it before the war."] Before the war there were imports from the Argentine, but the circumstances are entirely different now. One thing is essential, and that is that the production of high-quality beasts must be encouraged in every possible way, because they are the necessary basis of a sound livestock economy in any country.

  1593
  Let me now turn to the wider issues. We are in the throes of an economic crisis of the first magnitude, and we are all agreed that one of the ways to get out of it is to get a tremendous increase in home food production. We cannot accept this drop of 400,000 tons as against pre-war in our meat production, and I feel very strongly that a fresh impulse is needed and a new concentration on the land, and particularly on livestock. I have mentioned marginal land, but even more important in some ways is water. The Secretary of State enumerated a number of schemes, but, as he knows, the state of our water supplies is a continuing scandal, and has been for years on end. It really is fantastic. This is the wettest island in the world, and if the sun shines for three weeks the whole population gets into a panic, as they are now. It is perfectly crazy. If there is the slightest wisp of good weather, there is a water shortage in about 900 villages. We cannot expect it to rain every day; but that is about what would be needed to keep the wells full over a large part of this country. I really think that we must get a real drive in this matter, and that this should not be made a party issue.
  Then, there is the provision, always promised and never fulfilled, of adequate housing accommodation and transport facilities in the rural areas. I do not labour these points, but merely say that it is necessary for hon. Members on both sides of the Committee to draw the attention of the Government to them and prod them about them, that it is our business to do that and the whole point of having this Debate today.
  I would like to say another word or two about the herring industry, which has been mentioned by the hon. Gentleman who spoke last and also by the right hon. Gentleman himself. It is on the question of co-operation, which is very important. I have preached co-operation between the Herring Industry Board and every section of the industry, as the Secretary of State well knows, for many years; but in order to co-operate with somebody you have got to see him. I have a complaint about the Herring Industry Board, and they know it, that they do not go down amongst the fishermen at the time of the big fishings, and get into contact with them, and argue things out on the spot.
  1594
  There was a very interesting dispute the other day over the quantity of herring going for manufacture into fish meal, which, as has been said, is extremely important for agriculture. What the fishermen will not do, and I sympathise with them, is go out and catch herring solely for the purpose of manufacture into fish meal, because it does not pay them to do so. If the quality of herring is so bad that they cannot be sold for anything else, they jib at going to sea to catch them, and they are right. It is a question of an equitable price. There was a deadlock, with everybody getting angrier and angrier and hotter and hotter, until somebody suggested that the Herring Industry Board should go to Fraserburgh, where the whole thing was settled in an hour or two, as I anticipated it would be.
  The right hon. Gentleman should press upon the Board the necessity of getting into close touch with the actual operation of the industry, which they seldom do. I think that one or two members of the Board should be constantly visiting the great herring ports at the height of the summer fishing season, and should also be at Yarmouth and Lowestoft at the time of the autumn fishing. When these situations arise, sometimes as a result of gluts, they should be handled quickly by representatives of the Board, the leaders of the fishermen, and the curers, and the whole matter could be settled in ten minutes round a table; whereas, sitting in a board room in Edinburgh, which is about as remote from the herring industry as anything could be, there can be no direct contact between the Board and the industry, and misunderstandings are bound to arise.
  Our country districts in Scotland need to be fertilised. This can be done through a great expansion of the agricultural and fishing industries, and it can also be done through a great expansion of the tourist industry. I will not say anything today about the effects of the Catering Wages Act on country hotels in Scotland because I think it would be out of Order. I was afraid it would, but I wanted to get that one in. To revert to agriculture, we all know that it is not merely our greatest industry, but also a way of life. A prosperous and healthy agriculture is the necessary foundation of any country which wishes to hold its own in the modern world.
  7.6 p.m.
  Mr. Malcolm MacPherson: I think most of us would agree with a great deal of what has been said by the hon. Member for East Aberdeen (Mr. Boothby), although I could not follow him in his distinction between a Buchan and a Castlebay herring. For many years I followed the hon. Gentleman with a good deal of support in his campaign about herring, and he and I made, within a few weeks of each other, what I think were our first trips in a herring boat. He was at that time an important figure as a prospective candidate, and I heard about his trip, although, as I was an inconspicuous undergraduate, he would not be likely to hear about mine. Since then, I have taken a great deal of interest in his campaign about herring.
  The hon. Gentleman touched on general agricultural policy and also on policy with regard to marginal land. I want to say a little about the second topic, but, first of all, I would like to comment on one of the most interesting features of this Debate. It is the way in which so much of the discussion has concentrated on the question of marginal land, and I think the reason for that is to be found in the policy outlined by my right hon. Friend in his speech. The general agricultural policy of the country is undoubtedly sound, and we can find very little, it seems to me, on either side of the Committee, to which to take exception; but, when the hon. Gentleman calls for greater production, which he has every right to do, the answer undoubtedly is that present plans in hand will achieve exactly that effect. There is very little doubt that we can increase our production in a very spectacular way by the exploitation of our existing resources in marginal land, and I found a lot with which to agree in what was said by the hon. Member for West Perth (Mr. Snadden).
  I found myself, however, picking out one or two difficulties in the policy which my right hon. Friend described. I should like, for instance, to have it made clear what is the principle on which we are attacking the problem of extending our agriculture in marginal areas. Do we intend to follow a long-term policy? Agriculture, and the extent to which we can push it towards the margins of cultivation, depends a great deal on other
  1596
  factors. It is sometimes economic to develop marginal land, and at other times it may be more economic to leave it undeveloped. I should think that at the present moment a forward policy with regard to marginal land, and in the case of Scotland particularly, hill land, is a policy that can hardly be wrong. For the next generation or so, I think we are fairly sure to have in that a sound and safe policy. The policy which is being followed just now includes a very great deal of help for marginal producers, a far greater degree of help than has ever been given in Scotland before, but one is still inclined to ask whether the impulse behind it is definitely the impulse of going ahead as far as possible, or whether there is some other limiting factor.
  I wish to ask one specific question in connection with the relationships between afforestation and agriculture in marginal land. A month or two ago my right hon. Friend made a speech in which he said that the policy was to develop afforestation on semi-agricultural land. That phrase meant little to me, and means little to me now, but he explained it by saying that he meant rough pasture and bracken-infested land. That still leaves me in doubt. Rough pasture, after all, can have a great deal more done to it than simply afforestation. Afforestation may be one of its uses, but with the present interest in proper modern handling of grassland, which has been very strong in this country for the last 15 years, it is perfectly possible to turn a great deal of rough pasture into far better types of pasture land. I would not like to feel that our afforestation policy was in any sense one which meant that all rough pasture would or could be brought into afforestation. I think we ought to have some indication of what distinction is made.
  I notice, for instance, a couple of paragraphs in the White Paper which talk about the agreement between the Forestry Commission and the agricultural interests on a couple of islands in the Southern Hebrides. One is inclined to ask on what basis the agreements were made. I do not doubt that it was a wise agreement in each case, but was it made on the principle of what kind of land—taking its geographical location into account—would be used for afforestation, and what kind would remain for agriculture? A

  1597
  statement of the principle involved in that distinction would be useful as, in fact, would be a statement of the principle behind our policy with regard to marginal land in general.
  About a couple of years ago, a report was published on the subject of Scotland's marginal farms, and one of the conclusions reached by the authors of that report—who were experts in agricultural economics—was that many of our farm units in the marginal areas were too small to be economic. I should be glad if my right hon. Friend or my hon. Friend the Joint Under-Secretary for State, when he replies, would tell us whether anything has been done to deal with that particular problem. There has been, from time to time—and there is just now—a good deal of support among various people for the idea of co-operation in agriculture. It seems to me, that in the Debate on marginal land which we had in the House a week or two ago, that idea was put forward from the other side. It is generally in the more backward areas that these ideas take a little longer to germinate, and I wonder whether my right hon. Friend is using, or intends to use, the publicity services of the Department—which have been extremely effective and extremely educative in general farming policy—to encourage the adoption of the idea of co-operation among the farmers of very small and uneconomic units.
  I know, too, that the research services and the advisory services of the agricultural colleges have been less used by the farmers in the distant marginal and hill areas than by the farmers in the more accessible areas. As far as I can gather, that is probably due to the fact that these services, which have had to be expanded a great deal because of the demands on them, have been asked for by the bigger and more prosperous farmers nearer at hand, and have not been able, through sheer lack of manpower, to reach farmers in the outlying districts. But it seems to me to be very much worth while to extend these services into the marginal areas. There is a good deal of land which is not geographically on the margin but which is geographically, in many cases, our very best land, which is still not being used, land which has fallen into disuse and which, very largely, is unused just now because it is undrained. I think it is
  1598
  fairly clear to most of us that a programme of drainage would bring acre after acre into fruitful use, land which has been in fruitful use before but has fallen into disuse.
  I wish to ask my hon. Friend the Joint Under-Secretary two specific questions. I know that there are many difficulties with regard to drainage, particularly in these days when we are using heavy tractors with which to draw our implements, and there is far more pressure on the soil itself. But is as much research being done into that particular side of agriculture as there is into the questions of soil and the production of crops? Furthermore, in connection with the actual expenditure on drainage, which is apt to be heavy, is the limiting factor, where there is one—as there very frequently is—money or labour? I think it would be generally agreed that drainage is one of the key tasks that we must undertake in order to extend our tilled acreage, and I am sure it would be useful if my hon. Friend the Joint Under-Secretary would give us a little information on those points.
  I now turn to another agricultural question which has not so far been touched upon in this Debate. It is a question connected with the personnel in agriculture. I believe that most hon. Members would agree that in the course of time, a number of farm workers find the opportunity, and seize it, to become farmers themselves, but that they always become farmers in a small way. The point that I want to make is that in Scotland, at least, they never get beyond that small way. An ex-farm worker——
  Lord William Scott: Does the hon. Gentleman really suggest that no steward, herd, or farm worker can work up a farm and really become a big farmer in Scotland, and that such a person has not done so in recent years?
  Mr. MacPherson: I was not suggesting that none could do so; I am sorry if I put it in that way, but what I was trying to suggest—I accept the fact that my experience of the matter is not as great as that of the noble Lord—was that while a fair proportion of farm workers do become small farmers, the great majority of them never become big farmers. I certainly would not say that this was so in every case, but my impression is that there is a very considerable barrier for

  1599
  them between small farming and big fanning. I suggest that the Government should attempt, if, as I think—in spite of what the noble Lord says—my point is soundly based, to make a longer ladder. In point of fact, the bottom of the ladder ought to be broadened, because very few manage to make even the first rung of it.
  Now I want to come—and I think I am in Order in this because previous speakers have already dealt with the subject—to the question of transport in Scotland, and particularly to the condition of our Scottish ports system. We have a number of ports which are, and have been, flourishing in Scotland and my constituency includes the second largest port in Scotland, the port with the second greatest turnover of imports and exports. I am, therefore, interested to learn what is to be the policy which will underlie the development of the Scottish port system, because a seriously thought-out policy is necessary. The development of the ports involves very heavy capital expenditure. What is, in words, a comparatively simple type of development, like the installation of a heavy or even a light crane, means a huge sum in actual expenditure.
  The basic fact of the situation, as I see it, is that the Scottish economy upon which the ports system is based is sound, and we can add to that the statement in the White Paper that there is a definite intention on the part of the Government to develop the "so-far neglected resources"—I believe that is the exact phrase used in the White Paper—of Scotland so that we shall be in a position in which our economy is not merely healthy and sound but is expanding and developing. In particular, if one looks at the ports of the East Coast and the background of the industries which they feed, and from which the industries export, one finds factors such as the building of factories, in which we learn that since 1945 we have built factories in Scotland at the rate of 17 per cent. of the United Kingdom instead of in our ordinary proportion. Factory production is building up. In our coalfields we are beginning to shoot out our tentacles in the matter of undeveloped areas: and industrially we have some
  1600
  quite considerable developments, particularly in my own area.
  That is a background which should mean that the plan for the East Coast ports particularly ought to be a forward plan; we ought to be saying that these ports will be increasingly used. It may possibly be that some among them will fall into less use, but it seems to me that in general we are in a situation where the sort of policy to follow is one based on the idea that our economy is sound and is expanding.
  I want to ask, in particular, about the policy so far as it affects Grangemouth. A good deal of capital expenditure is needed in the Grangemouth docks. When the Working Party on the Turn-Round of Shipping examined the Grangemouth situation not so very long ago, their recommendation was for a second heavy crane to be installed in Grangemouth, and I notice that there is a statement in the White Paper that major developments are about to take place in the Grangemouth docks. In Leith the developments necessary have begun and in Glasgow——
  Commander Galbraith: On a point of Order. I do not want to interrupt the hon. Gentleman, Mr. Mathers, but it seems to me that his argument is really now trenching on the Debate which is to follow a week today and it might be that if he continues in this strain a lot of the material which should really come into the Debate next week, will no longer exist for that Debate. I ask for your Ruling.
  The Temporary Chairman (Mr. Mathers): This is, indeed, primarily intended to be a Debate on rural areas, but it seems to me that the hon. Gentleman has kept himself within the Rules of Order because transport is definitely related to the items which are before us.
  Commander Galbraith: Further to that point of Order. Is not the question of transport connected with the Debate only in so far as it affects the Secretary of State's salary? As far as I am aware, the salary of the Minister of Transport is not down for consideration.
  The Temporary Chairman: The salary of the Minister of Transport is not down and to that extent the hon. and gallant Gentleman is correct.
  Mr. MacPherson: Before you took the Chair, Mr. Mathers, I attempted to raise a point of Order to clarify that, but my hon. Friend the Member for the Western Isles (Mr. M. MacMillan) raised the question of transport mainly in connection with roads, docks and ferries. I took it, therefore, that I was in Order. I had every intention of proceeding with this in the later stage of my speech.
  Commander Galbraith: Of course, the hon. Gentleman the Member for the Western Isles (Mr. M. MacMillan) was perfectly in Order because he was dealing with a matter for which the Secretary of State is directly responsible, but I do not think the hon. Member for Stirling and Falkirk Burghs (Mr. Malcolm MacPherson) was dealing with such a matter.
  Mr. William Ross: Is it not also the case that the noble Lady the Member for South Aberdeen (Lady Tweedsmuir) spoke quite at length on the question of freight charges on transport, which are not the responsibility of the Secretary of State for Scotland?
  The Temporary Chairman: I am quite sure that the points made by the hon. and gallant Member for Pollok (Commander Galbraith) will not be lost on the hon. Member for Stirling and Falkirk Burghs and that he will realise the importance of limiting his remarks and not taking them outside the scope of the Vote which is before us.
  Mr. MacPherson: That seems to me, Mr. Mathers, to be a very wise ruling, and I certainly accept it. I had actually intended to develop a good deal more in connection with Grangemouth Docks, but I will conclude with the point I was making, which was that the policy of equipping the docks, primarily with cranes—although, of course, there is a good deal of other equipment which is, perhaps, of less importance from the point of view of capital expenditure—has been recommended, first of all, by the Working Party on the Turn-Round of Shipping and then stated in a short phrase in the White Paper. I, therefore, want to ask the Joint Under-Secretary what is the position about the implementation of that policy because in Leith and Glasgow we are having developments, and it is not merely a stated policy but it has been inaugurated. I should like to know whether it is to be put into operation in Grangemouth shortly
  1602
  and, if not, what are the reasons. Perhaps I may ask that question and perhaps it will be possible for me to catch the Chairman's eye in a few days' time so that I may develop some of the other points I had in mind.
  7.28 p.m.
  Lord William Scott: In an interruption in the speech of the hon. Member for Stirling and Falkirk Burghs (Mr. Malcolm MacPherson) I suggested that it was not altogether a fact that during recent years the agricultural worker has not had good opportunities of working forward, after becoming first of all a small farmer, and eventually going to the top of the tree and becoming a big farmer. In my own experience, not only in my constituency but also in the south-west of Scotland, I know of very many cases where an individual has gone right the way from the bottom up to a position as high as the average farmer in Scotland expects to reach.
  The number of cases in which that has been done in two generations could be multiplied a hundredfold, but I would point out that under the legislation we have passed in this House in the last three years that will be far more difficult. We have endeavoured to give a very large measure of what is known as security of tenure to the tenant farmers of Scotland, but what we have succeeded in doing is something quite different, something very nearly approaching a fixity of tenure, and those who will suffer most from the errors we have made are the young men coming forward who very likely would make just as good, or even better, farmers than even those of our present generation. The other sufferers will be the agricultural workers who are capable of doing all that is necessary to make quite good farmers. But the legislation we have passed in the last three years has led to far more difficulty for them.
  Turning to another subject, I should like to deal with marginal land. On this matter I am in complete agreement with what the hon. Member for West Perth (Mr. Snadden) said, but I think I am more or less in agreement with what every other Member on both sides of the Committee has said on marginal land, because we do seem, on this occasion anyhow, on all sides to be more or less in agreement on this particular subject.

  1603
  I do think, however, that the time has arrived when we have to declare rather more definitely what we mean by "marginal land." It has been quite obvious during the Debate today that quite a number of us have differing meanings in using the expression. I think we have got into the habit now of talking about all land which is not either hill sheep farmland, or which does not bear some relation to the rich cornlands of the Lothians, as marginal land. I think that the term "marginal land" has a rather more definite meaning than that of any farmland which does not happen to be either hill sheep farmland or the rich low cornlands.
  I think it has been generally agreed that Scotland should be doing more in the production of beef. The only increased production of beef that could come from Scotland would have to be from that marginal land. What is stopping it at the present moment is not legislation—for goodness knows, Scottish agriculture during the last three years has had an absolute spate of legislation. What is stopping it is the fact that the vast majority of the marginal land pasturage is not good enough to keep the cattle. We have to improve that pasturage, because otherwise we shall get no real benefit from it, from the cattle point of view; and we have to improve it to such an extent that it will carry the stock. Stock put on it as it is now would be merely a liability and not an asset to Scotland. I think the farmers have been fully aware of the necessity of getting more cattle on to marginal land. Twelve years ago, on a similar occasion to this, I spent 20 minutes talking entirely about trying to get cattle on to the hill farms. I do not think the term "marginal land" was used much in those days. We must get cattle on to pasturage which is very much better than it is at the present moment.
  One or two hon. Members have said that had we done as much for the production of beef as for the production of milk, there would be a much bigger production of beef in Scotland today. That is quite true. The fact remains that 100 years ago Scotland went out for the production of sheep. A great deal of money was made out of sheep 100 years ago, and for a long period. We have gone on paying for that ever since. One of the
  1604
  troubles of agriculture in Scotland is that we had far too many sheep on the land, and in a great number of cases sheep superseded cattle.
  The Secretary of State said there was no evidence that there really was a day when large numbers of Scottish cattle—store cattle—were moved to the south of Scotland and into England. Well, there is very definite evidence of that, and if he—or the Joint UnderSecretary—ever cares to visit that high ground where South Ayrshire joins South Lanarkshire and Dumfries, he will see the old drove roads down which hundreds of thousands of Scottish cattle, born in the West Highlands, were moved South to form the stores for the Lowlands of Scotland and for all England. If any Scottish Member has any doubt about it I ask him to read that very excellent book "Rob Roy." "Rob Roy" may be a romance, but it is a very accurate romance, and it dealt with the times 200 years ago and a little more when Scotland produced the store cattle for Great Britain. Until about 130 years ago Scotland produced store cattle which for the last 100 years we have always got from Ireland. Scotland in those days long ago showed that we have the climate in the West Highlands to produce store cattle, and there is no reason why we should not do it now, in possibly a slightly modified form.
  Whenever one asks any farmer why we have not more cattle on the marginal lands one learns that, apart from the grazing, one of the big difficulties is the very high price today, and for many years past, of the Irish store cattle. Irish stores are very, very dear indeed. Relatively, they are far more dear than the finished off cattle that go for slaughter. If only we can get the pastures improved, there will not be such a tremendous call as there is at present, and for some time has been, on the feedingstuffs. We in Scotland cannot produce those feedingstuffs which we require most of the year for finishing off fat cattle. Oil cakes and such like cannot be produced in any quantity, or in quantities worth mentioning, either in Scotland or in Great Britain. But we can produce better crops. There is no question about that. If we get better grass, there will not be nearly such a need for those feedingstuffs for finishing off cattle.

  1605
  I should like to hear from the Secretary of State whether he thinks we are now in a position to supply the agricultural community with all those necessities for improving our pastures. Have we sufficient lime? In the South of Scotland at present we draw much of our lime from Cumberland. Personally, I have no objection to Cumberland lime. I do not mind if it comes from Cumberland. I think it is quite good lime. However, I have a feeling that I should like to have Scottish lime. I am sure there is ample demand for it. In the old days there was a vast range of lime kilns throughout Scotland. I am quite certain that there are areas, in Lanarkshire particularly, where lime could very well be burned and ground again. I should like to know whether there are sufficient fertilisers so that we can really get on with the improvement of the pastures on our marginal land.
  While I am on that subject, I should like to say to the Secretary of State that I do hope that nothing he has said concerning the Black Galloway as beef cattle will be taken as being rather unkind. I myself regard the Black Galloway as a very excellent form of beef cattle. The Black Galloway are hardy and can live under almost any conditions, and the Black Galloway, and the cross between the Black Galloway and the Shorthorn, are, in my opinion, as good beef cattle as any to be found anywhere in Scotland. In my estimation they produce beef every bit as good as the Aberdeen Angus; and they can live on pastures not nearly as rich, in higher altitudes and in exposed conditions.
  There is one subject I should like to go into in some detail, and that is the subject of labour for the farms. At the moment, owing to housing and other difficulties, we are not getting any great increase in the number of our own agricultural workers, who are the best agricultural workers in the world, and for certain periods of the year we must, of necessity, rely very largely on the agricultural workers provided by St. Andrew's House through the agricultural executive committees. These workers are mostly European voluntary workers, some of whom are first-class, but some are as near useless as one could get.
  The European voluntary workers seem to fall largely into those two classes, the exceptionally good and the exceptionally
  1606
  bad. The farmers who get the good workers are only too pleased, because they get very good value for money. The farmers who get the duds consider that the sooner they get them off the farm the better. Surely St. Andrew's House ought to be able to devise a scheme by which the European voluntary workers could be given a little more incentive? I gather that they are not themselves very highly paid, and that they all get the same amount, whether they work well or whether they do not. I am convinced that with a little manipulation and a little encouragement a far bigger percentage of them would be in the satisfactory class of worker.
  Mr. Gallacher: Is it not the case that with a little manipulation of wages upwards for our own agricultural workers, we would get more home workers, and so have less need to use these displaced persons?
  Lord William Scott: I shall come to that in a minute.
  The farmers pay a very big price for this European voluntary labour, and some of them have complained to me that the bills from St. Andrew's House do not come in until rather late. That seems a curious complaint, but it is one which I have no doubt can be remedied. The farmers say that the bills are sent in so late that it is too late for them to be able to query inaccuracies and produce the necessary evidence. I hope that that point will be noted. I also hope that some means will be found to give more incentives, so that this labour can be geared up to a high level.
  I turn now to the question of our own home agricultural workers, to which the hon. Member for West Fife (Mr. Gallacher) just referred. From time immemorial agricultural workers in the Border country and in Southern Scotland have received very favourable wages compared with the wages of agricultural workers in the rest of the United Kingdom. Those of us who have farmed in both Scotland and England know that, although we may have paid higher wages to workers in the South of Scotland, those workers produce so much more work in the course of an average week that it was, on the whole, more valuable labour.
  I ask the Secretary of State to study the diets of agricultural workers in

  1607
  France, England, and Scotland in former years. He will find that over a large area in France the agricultural worker worked long hours but got almost no meat at all; they were almost vegetarian. In England the agricultural worker ate far less meat than has always been the custom for the agricultural worker in Scotland. I remember, when I was first elected to the House of Commons, being asked by a cattleman at a meeting in the South of Scotland: "What is the use of you talking to me about a home market for British meat when I can only afford to buy the imported Argentine stuff, although I am turning out the finest beef in Great Britain?" That was a difficult question to answer. What is the position today? On what are we feeding the agricultural worker in the South of Scotland, from whom we expect so much? He gets a shillingsworth of meat a week and a bit of cheese. The worst of it is that in the old days, not only did they get far more but far better quality meat, because the Argentine meat that we are getting today bears no comparison with the Argentine meat we imported 12 years ago. The Argentine seems to be able to send us almost anything. What are they getting in our part of the Border country, where we produce this magnificent beef, large quantities of which day by day go across the Border to feed various areas? A shillingsworth of meat a week, which is nearly always frozen meat from the Argentine. That just is not good enough.
  I know that for certain periods of the year, during the harvesting season, or when there is a bit of hoeing to be done, the agricultural workers get a bit more. I want them to get extra rations at other periods. If that were done, I am certain that we should not require so many of these European voluntary workers. I myself do not care to use the European voluntary workers, but in the circumstances I have to do so. None of us likes it very much. If our own agricultural workers could have the same rations as the miners—because they are doing just as hard work—the Secretary of State would go down in history as a man who had really done something worth doing for Scottish agriculture.
  7.47 p.m.
  Mr. Emrys Hughes: There are certain points on which I agree with the noble Lord. He emphasised one aspect which nobody else seems to have mentioned in this Debate, namely, the question of labour. We need far more labour on the land, and I believe we should concentrate more attention on this problem than we have done in the past. I am not so sure that I can agree with the noble Lord when he suggests that today the agricultural worker, with his Argentine meat, is getting less than agricultural workers in previous years. If I recollect aright, those who have studied closely what people ate, especially agricultural workers, in the time of Robert Burns, have found that meat did not figure very largely in their diet.
  In this Debate we have not had from the Opposition any comprehensive indictment of the Government's agricultural policy. No Opposition Member has said that farmers are almost ruined after four years of Labour Government, as was prophesied at the General Election.
  Colonel Gomme-Duncan: By whom?
  Mr. Hughes: I cannot help the hon. and gallant Member if he does not read the speeches of the leader of his own party.
  In this Debate there has been a complete absence of the argument that agriculture is not enjoying prosperity. The other day, in answer to a Question which I asked, the Secretary of State for Scotland told me that the number of bankruptcies among farmers in Scotland the year before last was four. If only four farmers in Scotland went bankrupt in 1947, and if agricultural workers wages are higher than they ever have been in the history of Scotland, that is a fairly good criterion upon which to judge the success of the Government's agricultural policy. The farmers are more prosperous than they have ever been, and there is no reason for them to vote Conservative at the next General Election. Nor should the agricultural workers, who are getting better wages than they have ever had in the history of Scotland.
  Some remarkable arguments have been used in this Debate. The hon. Member for West Perth (Mr. Snadden) appealed to the Secretary of State, a Labour Secretary of State, to put pressure upon the

  1609
  county council in his area because the roads were inadequate for agricultural purposes. In other words, the Socialists have to put pressure on a Tory county council because it is not doing its work efficiently.
  Mr. Willis: The Tory county council could then go about the country talking about State control.
  Mr. Emrys Hughes: Yes, and they are doing it. The hon. Member for West Perth produced a very good argument which deserves a great deal of consideration, that there should be a far greater attempt on the part of the Department of Agriculture to stimulate hill-farming activities. The argument—and I think it was accepted by the Secretary of State—was that the deer forests should be utilised to a far greater extent for sheep farming. It is true that a great deal of romantic talk has been heard in the past about the number of people who can be employed on deer farms, but we do not need to indulge in romanticism because our case is strong enough as it is. The constructive suggestions put forward by the hon. Member for Perth should be carefully considered. It is a new stage in Conservative propaganda when the hon. Member for West Perth and the hon. Member for Streatham (Sir D. Robertson) ask the Government to take a greater part in agricultural activities. I do not know what the hon. Member for Orpington (Sir W. Smithers) will have to say about this lapse when he reads about it in tomorrow's HANSARD.
  I want to draw attention to the agricultural land which has been taken over by other Departments. The Secretary of State should take up a much more determined stand with the Secretary of State for War on this. We have had two glaring examples in Scotland of good agricultural land being taken over for military training purposes. I think it was the right hon. and gallant Member for the Scottish Universities (Lieut.-Colonel Elliot) who protested against land being acquired in the Border, which meant that 22,000 sheep were taken off the Cheviots. I believe that in that case an alteration was made, although the scheme went through. This year we have had two glaring cases of land in Lanarkshire and Morayshire being acquired in spite of the strongest protests
  1610
  by local farmers and those interested in agriculture in the areas.
  In the neighbourhood of Lanark 4,823 acres of land have been acquired by the War Office, in spite of the fact that it meant four farms would go out of existence and that there would be loss of meat equal to the rations for 100,000 people for a year. In addition to the loss of meat, 24,000 gallons of milk sold outside the farms will be lost per year as well as 2,500 gallons used on the farms. In Morayshire, according to the reports of a farmers' meeting at which 200 were present, it is proposed to acquire 8,000 acres and 1,620 acres of arable land affecting 35 holdings. Protests were made, not by myself who might naturally be supposed to have certain prejudices against the military authorities, but by a very respected military gentleman whose rank will, I am sure, appeal to the hon. and gallant Member for Perth (Colonel Gomme-Duncan), that of brigadier. A protest was made by the Lord-Lieutenant of the County, who urged the farmers to fight the case on principle.
  For the first time I find myself agreeing in principle with a brigadier and Lord-Lieutenant. Furthermore, the Earl of Cawdor made a very violent speech. He said that he spoke from experience of what had happened elsewhere when land was requisitioned, and he urged the farmers of Moray to go ahead and put forward as strong a case as possible. The Earl described inquiries as eye-wash and said they were unlikely to lead anywhere. I believe that he is quite right. We had an example of that recently in Lanark. No fewer than eight high ranking military officers arranged presumably to give evidence at the inquiry, but according to the procedure it was impossible for the agents of the local authority and the National Farmers' Union to cross-examine them as they did not go into the witness box.
  The Temporary Chairman (Mr. Mathers): I think that the hon. Member will realise he is dealing with a matter which does not concern this Vote. I do not object to him dealing with matters affecting agriculture in Scotland, but he should try to relate his remarks to the responsibility of the Secretary of State rather than to the responsibility of the War Office.
  Mr. Emrys Hughes: That is the point I am making. This is the responsibility of the Secretary of State, because he appointed the inquiry and has the final decision. I want to know precisely where he comes in. Is the Secretary of State consulted before acquisition of land takes place? Is he the final authority in the matter? I am not at all satisfied that a sufficiently strong stand is made by the Department of Agriculture.
  The question of water supplies has been referred to, but there is also the question of electricity. Electricity is one of the most urgent needs in the countryside, both for the farm worker in his house and also for working mechanical devices such as milkers. I urge the Secretary of State to do his utmost to stimulate the activities of the electricity boards so that electricity can be brought more speedily to the countryside. Then there is the question of housing. The Secretary of State told us with great pride about the Swedish houses that have come to Scotland, which is a very laudable project. The only trouble is that it is not 1,000 houses but 5,000 houses which are needed.
  Here I would urge the Secretary of State also to have a few words with the Chancellor of the Exchequer to try to end this ridiculous procedure of these houses being brought into the country by the Secretary of State for Scotland and charged import duty at the ports by the Chancellor. Every problem in Scotland comes down to the question of houses. We should mobilise the building labour of Scotland in such a way as to lead to an acceleration and the development of housing in the country districts; that is our most urgent and pressing need.
  In conclusion, I want to say a few words about fishing. I have agreed with practically everything that has been said in this Debate by hon. Members representing fishing constituencies. I agree especially with the hon. Member for Streatham (Sir D. Robertson), even when he said that one of the greatest iniquities of all was bringing cods without heads into this country. We have had too many cods without heads brought into this country, and I believe that too many cods without heads have arrived in Westminster. I think hon. Members have been quite right in
  1612
  stressing the importance of fishing as part of our national economy from the point of view of food production. We shall need more fish, and I urge the Government to organise to a greater extent than they have done in the past the distribution of fish which is so badly needed to supplement the meat supply.
  On the whole, the agricultural communities of this country have every reason to thank the Government, and I urge the Government to go forward boldly with more imaginative methods of re-organising the countryside, and to leave the old methods which have been so strongly denounced by implication and otherwise by the Opposition tonight, so that when we go into the country constituencies of Scotland we can say, "We have not let you down. We have done a great deal to help you and we are entitled to a mandate to enable us to continue this work in the future."
  8.2 p.m.
  Mr. MacLeod: There are many points which I should like to raise on the question of agriculture and food, and I want to take up one or two of the points which have been mentioned and to stress them. There is the question of labour in agricultural areas. I believe that we shall not get the people to go back there, despite an increase in wages, until we have improved the amenities of our countryside. Neither shall we get the wives of the men to live in the houses there until they have adequate water supplies. In the Highlands we have welcomed the extension of the electricity supply, but again I should like to stress, as I have stressed before, the importance of water supplies in the rural areas. As to hill farming land, one of the reasons why full advantage has not been taken of the Act is because the cost of drainage is much too high; and in many cases in the Highlands a 50 per cent. grant is not adequate. We must get our lands in the Highlands dry before we can get any return from them. Even then they have to be limed adequately.
  The noble Lord the Member for Roxburgh and Selkirk (Lord William Scott) referred to re-seeding, but we shall not get the lands re-seeded until they are properly drained. I am glad to say that at last that fact is recognised, although it has taken a crisis to show the real value

  1613
  of agricultural land in the Highlands For that reason I disagree with the hon. Member who opened the Debate. I think the small man in the Highlands, as well as the large farmer, can play a very important part. In playing that part he will be aided if he is given adequate assistance in draining his common pasture land in the Highland hills. A lot of these drains could be used so as to put some of the water into the lochs at the bottom of the hills, which would be of great assistance to the rural areas.
  I should also like to mention the question of marginal land. Sometimes when the authorities consider what land is to be designated "marginal," they do not so designate certain lands, and here I am thinking particularly of land in my constituency which is of real agricultural value. It would be valuable if we could use more of this "marginal-marginal" land. I have in mind certain cases in which such land was not designated marginal land in the first instance, although ultimately it was so designated; I think the Under-Secretary knows of the case which I have in mind.
  Apart from these points, there is the question of transport in the rural areas, which I want to stress. Although I am sorry the Minister of Transport is not here I hope the points that I shall raise will be in Order. I think they will be as they affect agriculture. I wish to refer to the lack of transport facilities in the Highlands. I shall confine my remarks to this vexed problem which is linked so closely to agriculture and food supplies, and, indeed, the general wellbeing of the inhabitants and visitors to the area. Transport is the key to many of the Highland problems. We shall never be able to develop fully our agriculture and food supplies in the North until transport facilities are brought up to date and developed. We cannot have adequate transport in the Highlands until we improve our roads and make a sensible attempt to open up our country. The Secretary of State said that work was going ahead, but I wonder sometimes whether work is going ahead in the right place. I shall raise this matter later.
  Surely, it will be admitted that the first thing which was done by the proud pioneers who settled in our Colonies was to build roads and improve their trans-
  1614
  port. Yet the Highlands of Scotland today—and this is my point—have some 200 communities who have no roads whatsoever and, as the hon. Member for the Western Isles (Mr. M. MacMillan) said, in many cases the inhabitants have to carry everything on their backs. I do not think that my fellow Highlanders would be flattered if I compared them to a Colony, as the bon. Member for East Aberdeen (Mr. Boothby) compared them, but this question of the development of road transport in the Highlands must be tackled with the vigour and enthusiasm which we would put into Colonial development. Perhaps it is not inappropriate to refer to the Colonies at this time, when the "Colonial Month" Exhibition is taking place, as we all know that many Scottish people left our country to develop the Colonies. I believe we would be able to attract many of them back home again to visit their forebears if there were better road transport.
  The other day the President of the Board of Trade said that the tourist trade was our most important dollar-earner, and that we must do all we can to encourage that trade. Many applications for grants for roads are being refused because there are not enough people in the district, but I believe that if the tourist trade was taken into consideration at the same time as the advantages to be gained by the agricultural industry, the desire for opening up these areas in the Highlands would be more fully realised. I have heard tourists in my constituency say that they do not wish to come back because they have wasted so many hours waiting to cross ferries which serve main roads. They carry with them unpleasant memories of hours wasted and heavy car repair charges.
  I am handing out no bouquets to past Governments, but, to be fair, I must say that circumstances have changed and that the present Government are not taking this into account. It is true that further inquiries and reports have been made, but all this has been done before. There is a mass of information available on this subject. Take one—the Report of the Committee on Ferries in Great Britain. This came out a year ago. In December last I asked the Minister of Transport what he was doing about the Report. He replied that he was considering its recommendations, and hoped before long to let Members have more definite views. I

  1615
  hoped something would have been done before the present summer season, but so far as I know, the Report is still being considered, if it has not already been put into the appropriate or inappropiate pigeon-hole.
  Last week I was at a meeting in North Kessock where practically all those present were members of the agricultural community. The question before the meeting was the withdrawal of the motor ferry from Kessock. It was a very irate meeting. Conditions have deteriorated there, so much so that for the first time in living memory no vehicular traffic can cross the ferry. Further, the passenger ferry has been withdrawn from the Kyles of Lochalsh. This ferry comes under British Railways, and its withdrawal is a poor example of the working of nationalisation. Who gave the order to withdraw the ferry at the height of the summer season? It was obviously someone who had no knowledge of the conditions in the Highlands.
  Now I would like to touch on the question of freight charges. The charges made to the agricultural community for transporting goods and cattle are appalling. I do not altogether agree that this matter is not the responsibility of the Secretary of State. The issue is a vital one for rural agricultural communities. I was pleased to hear the right hon. Gentleman say he was looking into the question, but I urge that something be done now because these heavy burdens are a tax on the existence of people in the Highlands. I agree with the hon. Member for the Western Isles that people in the Western Highlands have a far more difficult problem to face. There are 32,000 inhabitants in the Highlands who live from 20 to 30 miles from the nearest railway station. They have to pay up to 25s. a ton on freight, and it has been calculated that shopkeepers in those areas must charge 2½ per cent. over their legitimate profit, in many cases, in order to make an adequate living. I realise that the problem is difficult, but it must be tackled before the two years which the Secretary of State mentioned, if we are to obtain any development through hard-headed—or even "cod-headed," as the hon. Member for South Ayrshire (Mr. Emrys Hughes) might call them—businessmen.
  I started my speech with a reference to roads, and I would like to leave by road. I only wish I could go by road
  1616
  to some of the places in the Highlands about which I have been talking. I made my maiden speech in the House on the question of roads, when I specifically referred to the road around the north coast of Applecross. I do not wish to appear parochial, and I am sure the Committee will forgive me if I appear to do so, but I consider the opening up of the Western Highlands to be a development of national importance. The Minister of Transport refuses to make a complete survey of the roads system throughout the Highlands, but I am certain that this will have to be done one day and that full consideration will have to be given to the method of financing payment for these roads. At the present rate of progress it will take years before parish roads which are not eligible for grant are taken over by county councils. In these areas there are food supplies which cannot get out because of inadequate roads.
  I press the Minister to make this survey. The Secretary of State painted a romantic picture today of the development in the Highlands, and told us that vast sums of money were being spent on agriculture and forestry; but much of this expenditure will be useless unless our roads system is improved. Many roads were built a long time ago, and are quite unsuitable for modern traffic. I hope that the Secretary of State will view this problem realistically to enable the Highlands to play, as people are now finding out they can play a vital part in the national economy. Until the primary question of roads, which I stress again, is tackled, they will not be able to play that vital part.
  8.22 p.m.
  Mr. Pryde: The Debate has reached a very high standard indeed. The brilliant and comprehensive exposition of my right hon. Friend the Secretary of State for Scotland is worthy of the attention of a crowded House of Commons, including Members not only from Scotland but from England and Wales also. No one should depreciate or underestimate the ability of the hon. Member for West Perth (Mr. Snadden) who initiated the Debate on behalf of the Opposition, and who is himself a practical farmer. I feel, however, that his thinly veiled innuendo was to make it appear that the present Government

  1617
  had failed to eliminate all the errors, mistakes and handicaps imposed upon Scottish agriculture in the history of the past.
  We do not talk often enough here about the land, especially the land of Scotland. There are numbers of hon. Members who wax enthusiastic over coal, foreign relations, questions of currency, housing and other things, but when all is said and done everything springs from the land. If the land is not right, nothing else can be right. According to the Secretary of State 110,000 people are employed on the land in Scotland, which means, surely, that it is our largest and most important industry.
  During the Debate reference has been made to fishing which relates principally to the Islands. I thought of the Good Book, which says:
  "There be three things which are too wonderful for me, yea, four which I know not."
  But even those things and everything else pale into insignificance beside the fact that for many years the trawler owners of the North of Scotland have been losing hundreds of thousands of pounds and yet, like the coalowners of the past, have lived on the profits out of their losses. For me, that is too wonderful for explanation. All I can say is that they must have been very great philanthropists indeed.
  I should like to turn the attention of the Committee to a part of Scotland which has all the characteristics of the Highland country and yet is not very far from the city of Edinburgh; where we have every form of agricultural activity—rich corn lands, as the noble Lord the hon. Member for Roxburgh and Selkirk (Lord William Scott) has indicated; marginal land, dairy farms, and gallant men who run sheep farms in outlying places, sometimes at great heights where there are very few roads indeed. But let me emphasise the needs of roads and electricity in carrying on the great work of agriculture. It may be said that these things are not the responsibility of the Secretary of State for Scotland, but the Secretary of State represents Scotland and it is he, and he alone, who may take the initiative, especially in opening up the countryside.
  In Peebles we have a diminishing agricultural population. Our farmers
  1618
  attribute that trend principally to the fact that the area and our farming communities and farms are so isolated. The people demand some form of recreation and relaxation, and the only way in which they can get it is by being provided with bus services and other facilities. We see the policy of the Ministry of Transport operating in the cutting down, or the threatened cutting down of railway services. It behoves the Secretary of State, therefore, to see that our roads are put into such a condition as will allow free movement for our rural population.
  It is no good telling a Tory county council or any other political body, including Labour, that they must undertake this responsibility. In a county such as Peebles, where agriculture is de-rated to the extent of 87½ per cent., obviously the necessary income is not available. The income of a county council, whether Tory or Labour is from taxation. If the policy of de-rating is applied to any considerable extent the money which is required to enable the work to be done is not forthcoming. The task, therefore, becomes a national responsibility. For many years the farmers of Southern Peebles-shire, even long before the General Election of 1945, have been crying out for electricity. They saw the Clyde Valley lead in electricity. They saw the Lothians Electric Power Company lead in electricity, yet the great rich, valuable farmland of the Broughton area remained without it. Today the churches and schools still use paraffin lamps and candles, which I consider is a scandal in view of modern technique and ability. I ask the Secretary of State to give his sympathetic consideration to this question.
  There is one matter regarding agriculture which I bring to the notice of the Scottish office. In countries such as South Africa agriculture is given preferential treatment in postal services; special cheap rates apply to agricultural products which are sent by post. Furthermore, free railway facilities are provided in order that sheep may gain access to grassland, yet, even with such handicaps to its revenue, South Africa is able to make a very valuable contribution to the food supplies of this country.
  The House of Commons should consider an early possibility of providing freer movement for our rural population in districts such as Peebles-shire and the

  1619
  Highlands by giving priorities for agricultural vehicles at reduced prices to ensure that farmers who have long distances to travel may do so more quickly. Sometimes their farms are scattered over large areas in hilly country which is extremely difficult to traverse. Motor distributors should be recommended to allow priority to members of the farming community to enable them to take their produce, especially eggs, into the market and thus help in a material way the food production of our rural areas.
  8.30 p.m.
  Mr. Thornton-Kemsley: I always think of the Secretary of State for Scotland as a superbly good salesman and I always feel at the end of a speech of his that he has made a very good case. I hope that he will forgive me on this occasion if I try briefly to point out two or three ways in which the case he has put tonight is not quite as strong as he would like to make this Committee believe.
  The first point is about the Highlands, led to, by what he said about the Government's contribution to the Highlands as a whole. "We are trying," he said "to keep people in the Highlands." He referred to the Swedish houses about which I have been concerned. I am very glad to hear that the Swedish houses are getting on well. They will make a big contribution in the places to which they have been allocated. It is not only houses that are wanted in the Highlands but industries, and I want to say a few words about one of the oldest industries in Scotland, that of the hand-loom weavers. I am always glad to talk about them, partly because my own great grandfather was a parish minister in Fenwick, in Ayrshire, and helped to get together the Fenwick weavers who started one of the first co-operative societies. I always remember my pride in looking through the dusty minute books of those weavers who, working with their hand-looms, got together and started co-operative methods.
  In many parts of my constituency in West Aberdeenshire I have ex-Service men and others who are trying to make a living out of the hand-loom. They have had most awful difficulties, first of all about getting into the export market,
  1620
  then with the dwindling of the demand in the export market, and now with the most crippling thing of all, the 66⅔rds Purchase Tax. I know that the Secretary of State is not responsible for the Purchase Tax.
  Mr. Gallacher: Would not the hon. Gentleman recognise, if he had studied the matter at all, that the Scottish weavers have contributed a very big share to the output of Communist ideas in this country?
  Mr. Henderson Stewart: We have a large number of weavers in my part of the country and undoubtedly there are very few Communists among them.
  Lieut.-Colonel Elliot: Is it not a fact that the weavers have contributed to the development of all thought in Scotland?
  Mr. Thornton-Kemsley: I am greatly tempted by the hon. Member for West Fife (Mr. Gallacher) to be led astray, but time is getting on and many other hon. Members want to speak. I recognise that this is not the Secretary of State's responsibility, yet it is a Government responsibility that employment should be provided in the Highlands and in Scotland generally. I hope that the Secretary of State will use his very powerful weight in the Cabinet to see that this matter is rectified as soon as possible.
  The next matter is that someone ought to mention on 30th June the Town and Country Planning (Scotland) Act, 1948. This is a most important thing for, from midnight tonight, no one who has not already submitted his claim, or has certified that he has instructed it to be done, will be able to make any claim on the compensation provided under the terms of the Act for loss of development rights. I am not a betting man, but I would not mind risking a large sum of money on a bet that only a very small proportion of the people who have legitimate claims, will, by midnight tonight, have submitted them. Even with the extension that was given from the end of March to the end of June, there is abundant evidence to suggest that far too little time has been given to allow for the toil and trouble involved.
  I have looked up the references to see what instructions have been issued about this matter, and I was surprised to see

  1621
  that since the passing of the Act no fewer than 27 statutory instruments and eight explanatory leaflets have been issued—I am talking now about the Scottish Act and not about the English Act—and five explanatory memoranda from the Central Land Board. That makes 40 documents. It is almost impossible for a layman, and very difficult for anyone skilled in these things, to understand them. To expect ordinary folk to grasp the significance of what has been done is asking too much. I believe that most people will only realise the injustices of this Measure—which nationalises development rights in Scotland, which refuses to compensate as of right and only by ex gratia payment in cases of hardship, which is nowhere defined in the Measure itself, and which leaves the basis of compensation to be determined by a Treasury scheme which has not yet been made—as the years pass and more development charges are made. In the meantime owners have been put to immense trouble and expense with no kind of guarantee that their just and reasonable claims will be met by the payment of anything more than a few shillings in the £.
  I support those hon. Friends of mine who have spoken about the meat position and our miserably low meat ration, and I agree with them that there is very little chance of obtaining a quick increase in our supplies of meat from any overseas source and that our best chance is to look inwards to our own home resources. We ought not to allow our pleasure at the conclusion of the Argentine Agreement to blind us to the fact that last year the Argentine defaulted on over one quarter of the amount of meat she had agreed to send us for no better reason than that she was offered a better price by Holland, Belgium and other countries. It is a characteristic defect of Government to Government trading that there is no sanction short of war by which a bargain can be enforced.
  Before the war, our home production of meat and bacon exceeded one million tons a year and it accounted for about half our consumption. Though we have now over two million more mouths to feed, last year our home production was only 779,000 tons or 41 per cent. of our consumption. As to Scottish production, I see from the White Paper on Industry and Employment in Scotland, in Table V
  1622
  of Appendix I, that comparing 1938–39 with 1947–48, we were 25,000 tons down on the production of beef, 20,000 tons down on the production of mutton and lamb and 11,000 tons down on the production of pig meat. I heard the speech of the Secretary of State and I realise that the figures will be better, but that was the official information we had before he spoke.
  There is no earthly reason why we should not make Scotland the greatest meat producing country for its size in the world. If we could do so it would be very much to the advantage of Scotland because by reason of long tradition and inherited skill in the selection and breeding of livestock, and by reason of its climate, which produces almost better grass than anywhere else in the world, we have par excellence a livestock producing country. The short-term way to step up our production is by means of the pig, and there the problem is one of feedingstuffs. Where does the Secretary of State stand about the matter of feedingstuffs? He is a member of the Cabinet in a Government which has been almost criminally negligent in its failure to import the raw materials upon which alone large increases in our home production of meat could have been made possible.
  The Economic Survey of 1948 pointed out in paragraph 158 that the shortage of feedingstuffs threatened to delay the livestock expansion programme. It was perfectly understandable since, in 1947, we imported slightly over 700,000 tons of coarse grains as compared with over 4 million tons in 1938. On 6th August, 1947, the Prime Minister said in this House that the maximum supply of feedingstuffs must be obtained, and the Lord President followed that up in the same month when he addressed the agricultural executive committees and said that large increases must come from imports, and that even scarce dollars would be spent on all that was obtainable, since this operation must lead to ultimate dollar saving.
  There is not the least doubt that feedingstuffs were available, but hardly any were bought with dollars; in fact, the most we bought—and not with dollars—were during last year, when we bought 1½ million tons as compared with more than the 4 million tons before the war.

  1623
  If we had really set out to secure the maximum amount of feedingstuffs, as the Prime Minister said we must do, the meat ration need not have fallen to its present all-time low record. The long-term question depends on the production of beef and there, as my hon. Friend said, we must look to the price incentive. Representing a part of Aberdeenshire as I do, I must say that there must be encouragement for quality production, and we must look for protein feedingstuffs.
  Before I sit down I want to make two practical suggestions. The first is regarding the extraction rate of flour. A reduction of 2½ per cent. in the extraction rate would not only give us a better and more palatable loaf which would keep longer, but would provide us with 170,000 tons of additional feedingstuffs for animals—the conversion rate of which is equivalent to 25,000 tons of pork, bacon and fats. And all that could be done at a cost of only 180,000 tons of wheat, which is available at the present time. My second suggestion is that in the agreements we make with Canada and other countries we should insist, as we used to do in the past, that we import whole wheat instead of flour, because we are paying the whole wheat price but are getting flour and losing the valuable milling offals, with a high protein content, for which we have paid.
  I recognise that these are not matters for which the Secretary of State is directly responsible, but he ought to urge them upon the Government. For Scotland this seems to be a heaven-sent chance. Are we seizing it? I wonder whether the Secretary of State is really thumping the table at 10, Downing Street as hard as he might do and saying that Scotland must be allowed to make its contribution. Is he working in the closest association with his colleague the Minister of Agricultue and Fisheries? I hope he is, because I believe he ought to be doing it about this question of feeding-stuffs as there is a case where both their interests are parallel.
  The Psalmist writes with approval of those
  "who going through the vale of misery use it for a well: and the pools are filled with water."
  I believe that our present misfortunes can be turned to our advantage if we only look inward to the riches of our own
  1624
  fields, to our own soil, and make the most of our own natural resources.
  8.45 p.m.
  Mr. William Ross: The hon. Member for West Aberdeen (Mr. Thornton-Kemsley) wondered whether my right hon. Friend the Secretary of State had been thumping the table in Downing Street. If the hon. Gentleman had properly appreciated what has been done in Scotland in the past few years, particularly what has been done for the farming industry in that time, surely he would have come to the conclusion that my right hon. Friend has been thumping the table harder than any other Secretary of State for Scotland, and that he has had success. I have been astounded tonight, in comparing what we have been hearing from hon. Gentlemen opposite with what we heard from them on Monday and Tuesday when, hour after hour, relentlessly and undismayed by constant defeats, hon. Gentlemen opposite rose hoping to reduce the "rake-off," as they politely called it, which the Chancellor of the Exchequer was taking in the form of revenue, thereby limiting, as it must have done, the generosity of the Government.
  Today from the very start, with the speech of the hon. Member for West Perth (Mr. Snadden), we have heard a different story. He pointed out that the reason why we could not get a proper impetus in beef production was that there was no profit in beef. He said that the Government must give further subsidies to ensure that there would be profit.
  Mr. Henderson Stewart: He did not say anything about subsidies.
  Mr. Ross: He implied that. I advise the hon. Gentleman to read the OFFICIAL REPORT. He will find that what I have said is correct. The hon. Member for Streatham (Sir D. Robertson), in his desire to see things righted for the inarticulate people of Caithness and Sutherland, suggested that the Government should buy up thousands of acres of land and rehabilitate it. Again, that will cost money and again it will mean higher taxation. But what hon. Gentlemen opposite were saying on Monday and Tuesday was politely forgotten in their demand that more money should be paid out in this way. The hon. Member for South Aberdeen (Lady Tweedsmuir) and

  1625
  the hon. Member for Ross and Cromarty (Mr. MacLeod) demanded transport subsidies. I ask hon. Members to recall all that we have heard in the Scottish Grand Committee from the hon. and gallant Member for Perth (Colonel Gomme-Duncan) about the "charity State" and the sneers that we get on the question of food subsidies. Here we come to the very essence and substance of the food subsidies. In Scotland the majority of them are paid to Scottish farmers.
  Colonel Gomme-Duncan: For the benefit of the consumer.
  Mr. Ross: Far too much has been said about what has not been done by the Government and far too little attention has been paid to what has been done and to the achievements of the farming industry in the past year. On the question of livestock alone, the increase is very good. This is all tied up with the question which was touched upon by the hon. Member for West Aberdeen—the difficulties over feedingstuffs which are not so easily explained as he glibly tried to explain them in a few sentences. We have increased our dairy cattle by over 12,000 in the past year. Despite all that has been said, we have increased our beef cattle by nearly 27,500.
  In regard to sheep, I think it is a spectacular achievement, when we are recovering from the catastrophic events of the previous bad winter, that last year alone we managed to increase the number of sheep being reared on our Scottish hill sides by 706,000, or nearly three-quarters of a million.
  Sir Basil Neven-Spence: Is that figure not still below what it was in 1938?
  Mr. Ross: The figure may be nearly a million below the 1938 figures. In 1939, the figure for sheep was just over eight million, and by 1947 that had been reduced to just over six million. The point to which I want to draw attention, and which we are supposed to be discussing here today, is the development in 1948, and the fact that there was an increase from 6,240,688 to 6,730,664 is an achievement to which we should pay due tribute. The same thing applies to pigs, and we have increased the pig population by 35,400.
  As to poultry, despite all the terrible difficulties about feedingstuffs, in the
  1626
  supply of which we have done really great things in the past year, the numbers in Scotland increased by 1,367,000, and the result of that increase is well-known to the housewives in Scotland. Of course, we do not get away from the grousing; when people never saw an egg, they prayed for them, and, when they got them, it was a case of "Eggs again." I do not place too much emphasis on that kind of grousing, and I am sure the people do appreciate what has been done for them in that direction.
  During the Debate concerning the increase in milk production—which reached the record figure last year of 139 million gallons, an increase of 12 million gallons over 1947—there seemed to be some regret about the over-concentration on milk and a feeling that too much was being done and that we should now stop and concentrate all our efforts on beef. I think that is the wrong way to tackle the subject altogether. We want all that milk, and we want more. We want beef production to be stepped up admittedly, but we should not forget the value of the 139 million gallons produced in Scotland last year to the people of Scotland, and especially the mothers and children of Scotland. The fact that we can point with pride to a rising generation healthier and better than at any other time in our history is due entirely to the fact that today milk is going for liquid consumption and not, as before the war, for manufacture into buttons and umbrella handles.
  Lieut.-Colonel Elliot: What percentage does the hon. Gentleman think went for that purpose?
  Mr. Ross: The point is that this was done at a time when the people needed the milk, and there should have been none at all going for that purpose at the cheapest possible rate—cheaper than the price paid by the consumer.
  Lieut.-Colonel Elliot: Does the hon. Gentleman really think that it was more than a decimal fraction—.0001 of the total milk production of Scotland?
  Mr. Ross: I do not think it is a matter of importance at all, but I say that the children whom I was teaching required that milk, and as long as they required it none should have gone for that purpose.
  Lieut.-Colonel Elliot: Why, then, did the hon. Gentleman's party vote against the milk in schools Act?
  Mr. Ross: I will leave that to the Under-Secretary of State for Scotland. The fact that the milk now being produced represents one-third of the total output of Scottish farms and amounts in value to over £20 million is not a reason for now clamping down and saying that that is enough. The fact is that we still cannot de-ration milk, and until such times as we can, I see no reason why this should not continue.
  Mr. Henderson Stewart: It is de-rationed now.
  Mr. Scollan: Not at all.
  Mr. Ross: It is not de-rationed all the time, but only during the flush months. The fact is, of course, that we require more, and that we require even better milk. The fact that the Ayrshire farmers have managed to eradicate bovine tuberculosis in nearly 84.3 of their cattle, and that the farmers of Bute, a neighbouring county, have managed to eradicate 86.5, shows that we in Scotland are not only concerned about the quantity, but also about the quality of milk, and that we should continue along these lines and do a little pioneering work, especially in England, with a view to getting purer and better milk.
  I trust that the Government, in listening to the plea of the hon. Member for West Perth concerning the desirability of doing something about beef production, will not do it at the expense of the milk production. We require both. By all means let us get this unbalance righted within the farming industry, but do not let us do it by bringing down the level of one to help the other.
  Mr. Snadden: Assuming that is what I suggest, which it is not, I agree that today we are out of balance, but what I am asking is that we should get into balance again.
  Mr. Ross: I fully appreciate that the hon. Member did not really mean that, but had he been present he would have heard his hon. Friend the Member for East Aberdeen (Mr. Boothby) say that we have concentrated far too much on milk. I do not think that is the fair way to put it. It would have been better to
  1628
  have said that we have not concentrated sufficiently on the production of beef.
  I want to put a few other points to my right hon. Friend the Secretary of State for Scotland. Too little has been said about the labour position in the farming industry. These achievements, which I submit are really achievements both of the Government and the industry, have come about during the past year with the employment of 6,000 to 8,000 fewer people. I think it is about 6,000; we lost about 9,700 prisoners of war, but we have some voluntary workers. I am concerned to know whether my right hon. Friend is satisfied that in the coming months, and particularly during the harvest months, there will be a sufficient supply of labour for the work to be done. Is there any hope that either this year or next we shall be able to dispense with the necessity, which I do not like, of relying on school children to pick the potato harvest of Scotland? I do not think that is the best way to do it, or that it is something of which we should be proud.
  What is the Government's long-term plan for attracting adequate labour into the farming industry, and is my right hon. Friend satisfied that his programme of 5,000 houses for agricultural workers between now and 1951 is truly adequate? I feel that we must give priority to this fundamental question of housing the agricultural workers. The industry is becoming much more attractive, and I feel that many of the people who left it in the years that the locusts—and, in my opinion, the Tories—have eaten, did not leave it because they did not like farming; they left it because they had to for economic reasons. The economic state of the industry and the standing of the farm worker have increased immeasurably, but we still lack the decent houses, which, in my opinion, would attract the labour we require. I trust that, in tackling that question, we shall continue to make advances in the Scottish farming industry.
  We have, as we have never had before, a settled hope and prospect of prosperity; it is no longer just a case of clinging' to something this year and not knowing what will happen next year. One hon. Member spoke of our spate of legislation. The legislation we have had for the farming industry is good legislation and I shall not object if we get more legislation provided it is as good as that which we have already passed.
  9.1 p.m.
  Mr. Henderson Stewart: In the few minutes which I shall occupy, I want to refer to one or two matters which have not been dealt with as fully as they might have been. I must say that I think the hon. Member for Kilmarnock (Mr. Ross) was a little unfair to my hon. Friend the Member for West Perth (Mr. Snadden). I am not so sure that the same charge might not be made of the Secretary of State. I thought the speech of my hon. Friend was a model of what we might desire in this Committee; it was fair, it was balanced, it was well-informed and it was impressively constructed, and, far from its being thwarted by the fact that my hon. Friend knows his job very well, it struck me that it was his very width of knowledge and experience that gave his speech the power which it undoubtedly possessed.
  We had from the Secretary of State a long and, I admit, instructive catalogue of the activities that may be found in many parts of Scotland at this time. He painted a picture which was, no doubt, intended to suggest that he and his administration are not only the best that have ever been, but are reaching as near to perfection as anything could be. Yet the reply given to him by the hon. Member for the Western Isles (Mr. M. MacMillan) can scarcely be described as a very friendly and admiring contribution. Indeed, the more often the hon. Member for the Western Isles speaks in this Socialist Parliament, the more critical he becomes of the Socialist Government. Very soon he will be following Lord Milverton in springing across the Floor of the House. We should give him a very pleasant welcome if he thought it proper to do that. One never knows.
  I am not here to condemn or even to belittle what has been achieved in the last three years. I think it is quite remarkable what Scottish organisations, officials, farming, tourist industry and industrial organisations have gained for our country in these last three years. Everybody is entitled to credit for that. The Government are entitled to credit for what they have done. I think it would be quite wrong to suggest that nothing has happened; that is not true.
  What the Secretary of State has done, however, is no more—indeed, it is a good deal less—than the present revivalist
  1630
  spirit of Scotland demands and expects from this Government at this time. I have been in politics for a long time, and I must say that I see more real life in Scotland—I am not talking about political parties—than perhaps at any time in my political career. One feels that in all directions there is an urge for an improvement of our affairs and particularly for the better management of our affairs. As I said in a Debate last year on the Highlands, I think it is very largely a matter of administration. This is not the occasion to develop that point but I am certain that until we get a more coherent and co-ordinated administration of Scotland, bringing to our country a larger control of its affairs—and I am not now proposing a Scottish Parliament but a more effective control by Scotland of Scottish affairs—we shall not succeed in obtaining those things which all of us desire.
  I observe that the Secretary of State is the object of a constant, bitter attack from the nationalist movement. I observe, too, that he receives a constant stream of criticism from the local authorities. It seems to me, therefore, that in some directions he is failing to give to the country what it requires. It is too late tonight to try to answer the question, what does it require? I should, however, like to mention one or two things in the couple of minutes which remain to me.
  It is interesting and no doubt instructive, to be told that there are so many hundreds of thousands of pounds to be devoted to this, that or the other thing, but as the hon. Member for Kilmarnock said, the fundamental consideration is the state of the men and women working in the industry; and there is no doubt that the conditions that those people have today are not adequate to encourage them to stay on the soil and to make it their career. Of course, wages are better. One has seen that. One has seen the improvement, for instance, in the clothes worn by the village children. Nothing gives me greater pleasure than that. But we know quite well also that costs have risen, and there are people in Scotland today who believe that they were as well off in the old days with the 25s. or 30s. a week as with the present £4. There are many who say that. I am not saying that this is a completely accurate picture of the situation. However,

  1631
  there it is; the cost of living has largely increased.
  Moreover, there is no question that the farm workers in Scotland are underfed. They are not getting enough food. In Fife the farm workers and the miners intermingle and live in the same villages, and the fact that one group of people, the miners, have canteen facilities whereby they are able to get more meat, is a source of irritation and of a feeling of injustice amongst the farming people. Unless we improve that situation we shall not have the contentment on the land that we expect and wish to see. The hon. Member for Kilmarnock is quite correct in pleading for a better housing allocation for the farm workers.
  I should like to ask the Secretary of State a question related to that. Perhaps the Joint Under-Secretary of State, who is to reply to the Debate, will answer it. What steps have been taken to ensure that there is a sufficient labour force for the potato harvest? I sometimes have battles with the hon. Member, but when he is entitled to a compliment I am ready to pay it, and last year, when I appealed on behalf of the Fife farmers for help, because they had not enough labour to lift the crop, the hon. Gentleman came quickly to Cupar and did his best for us. What is to happen this year? Are we to be put into the same panic again, or will he assure us there will be sufficient labour available? The hon. Member for Kilmarnock says he does not like schoolchildren lifting the potato harvest. There is only one answer to that—mechanisation. I wish we had heard more today about farm mechanisation, because that is one of the developments that we shall see in the course of the next few years. What is being done about mechanisation in Scotland? I wish the Under-Secretary of State would tell us. I am just back from Canada and America where I saw the enormous influence which farm mechanisation has in the agricultural industry.
  Mr. Scollan: What about the different size of the farms in Canada and America?
  Mr. Stewart: There are large and small farms. We are more highly mechanised than Canada, but we are not getting far enough ahead yet. There is nothing in this White Paper to indicate what is the
  1632
  production of farming machinery in Scotland. We see a lot of other figures about all kinds of engineering, but nothing about farming machinery there. Surely there ought to be something about it when this is a matter of such enormous and growing importance. Our machine manufacturers have exhibited at the Toronto Exhibition, and some of them have done very well. Let us hear more about that. How is it going? What is happening? What developments are afoot? What are the Government doing to assist the manufacturers?
  I would have said more, but my time is very short, and we are waiting to hear the right hon. and gallant Gentleman the Member for the Scottish Universities (Lieut.-Colonel Elliot). However, there is one more topic I wish to raise which affects the country districts of Scotland and the Highlands, and to which the Secretary of State made some reference. There is no doubt about it that the richest and most immediate source of increased prosperity for our people lies in the development of the tourist trade. Perhaps it is a pity that that is so, but it happens to be true, and certainly in the Highlands. We had a Debate on this subject only the other day, and I do not desire to repeat all the old arguments, but it remains true that unless the Secretary of State takes steps to increase the number of hotels in the Highlands and other country parts, and greatly to improve the transport in those parts, he will deprive Scotland—Scottish industry and the Scots people—of the food and raiment to which they are entitled by their efforts. I know of many men who have applied for permission to build what are called "motels," or small cottage hotels, but who have been refused. What a senseless policy that is. Surely a thousand of these tiny cottage hotels might be developed in Scotland within a year without causing any great anxiety to anybody or drawing greatly upon any funds. There is a source of dollar revenue which falls within the scope of this Debate, and I think that might well be expanded.
  There it is. I think the Secretary of State will feel that he has had a fairly good day. He has obtained from different parts of the Committee, not least from his own supporters, a certain amount of spurring on, which is the purpose of this Debate. I give him credit for what has

  1633
  been accomplished, and I say in conclusion that we expect much more from him, but that he will not go down to history as a great Secretary of State until much more has been accomplished.
  9.11 p.m.
  Mr. Hector Hughes: I desire to touch on an aspect of food production which I think has not been adequately dealt with in this Debate, if it has been dealt with at all. I refer to the mechanisation of farms. Before I do so, I should like, with respect, to congratulate the Secretary of State upon his admirable speech. It seemed to me to be a mine of information, a compendious survey, and a worthy successor to a number of similar speeches which he has made since occupying his present office. It indicated a period of successful work and progress, and hope for the future.
  The one matter to which I desire briefly to draw attention is, I confess, a mystery, not only to me but to a number of other people. I ask the Secretary of State to try to explain the inexplicable and to "unscrew" the inscrutable, and to give us an explanation of this mystery. It affects not only Aberdeen, in which I have a special interest, but the whole of Scotland, because it is a matter of general bearing. I shall put it briefly in the form of four questions which I should like my right hon. Friend to answer. First, what is the cause and also the effect on food production of unemployment in factories producing agricultural machinery? Secondly, what is his relation to a Royal Ordnance Factory in Scotland which has been handed over to an individual firm? Thirdly, do the Government retain any control over such a factory? Fourthly, can the Government do anything to keep it in production for the good of the nation? The Secretary of State will be aware of the particular factory to which I am drawing his attention, namely, the Tullos factory in Aberdeen.
  The recent admirable Report on Industry and Employment in Scotland, 1948, touches on this. That report very properly points out that the total industrial population continued to expand during 1948 but is unlikely to continue to do so, and that therefore efforts must be concentrated on increasing production from existing sources. Two obvious methods are mechanisation and control of individual firms or individual busi-
  1634
  nesses, particularly, I would suggest, individual businesses which were formerly Royal Ordnance Factories and which have been handed over to individual control. Particularly is that so——
  The Deputy-Chairman: I am afraid the hon. and learned Gentleman is now going much too wide. The Debate is narrowed to matters connected with industry and employment in Scotland so far as they relate to agriculture, fisheries, food, transport and rural industries.
  Mr. Hector Hughes: I should not attempt to cover all of those subjects. I am content to keep to the first—agriculture. I am dealing with a particular firm because it produces agricultural machinery, and has, in my respectful submission, a direct bearing upon the production of food. That report to which I have referred, on page 5, says this:
  "With about one-tenth of the British labour force, Scotland employs a higher proportion of her manpower (10.5 per cent.) than does Great Britain (8.6 per cent.) in the primary producing industries,"
  of which, of course, agriculture is one. The history of the ex-Royal Ordnance Factory to which I have referred shows that it is obviously operating against the tendency indicated in that report. This particular factory, which produces agricultural machinery, for some unexplained reason now employs much less than its full potential and is actually dismissing workers. That, I submit, has a direct bearing upon the production of food and is a matter which, I hope, is within the scope of this Debate. On page 6, the report goes on to say:
  "To turn to Scotland's future prospects, an important means of increasing production will be by developing resources which, for one reason or another, are now largely neglected."
  Here is a case where resources are being inadequately developed. This admirably equipped factory has no shortage. It is one of the best equipped factories in the country. It can employ 600 workers, and it did in fact employ 360 workers. What is the state of affairs there? Workers are being dismissed in large numbers, and so the productive power of the factory is being reduced, and the assistance which that production will give to agriculture is also being diminished. As the secretary of State knows, I have had some correspondence with him, and I have also had some

  1635
  correspondence with other Ministers. Though I am not laying any blame at the door of the Secretary of State—I know he has done his best—I beg him, in the interests of food production and particularly in the interests of the workers of Aberdeen, to take such steps as are open to him on the lines of the four questions I have put to him, or otherwise to attempt to solve this mystery.
  9.18 p.m.
  Lieut.-Colonel Elliot: It would have gladdened my heart to have risen earlier, but I knew that many Members were still anxious to contribute to this very valuable Debate. I regret that even now there are one or two Members who will have to return home with that saddest of things, a Scottish Supply Day speech undelivered. I think that today has justified the double procedure which we enjoy, the Committee Debates upstairs where shorter speeches can be made and the more ample Debates below, when it is possible adequately to develop a theme. After all, the opening speech was 37 minutes and the Secretary of State took 44 minutes—I do not think any one of us would have wished those speeches to be shorter. I am not an advocate of only a number of stabs at the subject in 10-minute speeches; there are times when the subject must be developed.
  I am sure that we were very grateful both to my hon. Friend the Member for West Perth (Mr. Snadden) and to the Secretary of State for Scotland for the reviews they gave. The Debate has had the characteristic of our Scottish discussions, in that it has ranged rapidly from the great to the small issues. It has been none the worse for that. After all, as Henry IV of France said, the purpose of Government is to see that every peasant has a chicken in his pot on Sunday. The purpose of Government is that small things should be done well; large things are only a means to an end. I thought the Secretary of State was a little cavalier in his rebuke to my hon. Friend the Member for West Perth in saying that he was an expert standing so close to his subject that he was unable to take the widest view. But it was from his close and knowledgeable examination that the Committee so much benefited, as it also did from the speech from
  1636
  the hon. Member for Accrington (Mr. Scott-Elliot), who was able to give us an account, from personal experience and intimate knowledge, of the working of schemes under the Hill Farming Act.
  The main application of the Debate has been the admitted present shortfall in meat production in our country, which, for the whole of the Kingdom, amounts to 400,000 tons, and which it is very desirable to remedy as soon as possible. The argument was that more could be done in the use of marginal land in Scotland, and I am sure that is true. The Secretary of State's dithyrambic description of the present state of affairs in Scotland, which we all greatly enjoyed, showed in some respects the zeal of the convert. He explained that it was all wrong to suppose that anything could be done with deer forests, and that all the talk in the past about deer forests had been so much romance. I wondered whether some of the other theories which he was advancing, and from which he has not departed, might not prove, in the evening of his days, as romantic, unreal and misty as the visions which he himself had at one time. As he himself said, he had then never seen a deer forest.
  When we were rebuked by the hon. Member for the Western Isles (Mr. M. MacMillan) for not having shown sufficient vehemence in our support and advocacy of the Empire crusade of Lord Beaverbrook, I said to myself, "Is Saul also among the prophets?" What was the attitude of the hon. Member at that time? Did he then, or does he now, line up the Labour Party behind Lord Beaverbrook? I interrupted the hon. Gentleman—and apologise to him for doing so—when he was reading about the third paragraph of a leader in the "Daily Express," because I was stung by the gadfly of reminiscence of many long battles I fought along those very lines, and the strong opposition I had to meet from the party opposite.
  I remember, when I was favouring the home production of bacon as against Denmark's bacon, the vigorous attacks which I received from the present Minister of Defence. I also remember, when we were expanding sugar beet production, the solid Socialist phalanxes which used to swing into the Lobby in favour of cutting

  1637
  down or, indeed, abolishing its production on the ground that we could get all the sugar we required from Java. I seem to have heard that word lately, but not in connection with increased production of sugar for this country.
  Then the hon. Member for South Ayrshire (Mr. Emrys Hughes) twitted us with not having attacked the present policy of the Secretary of State sufficiently strongly. But why should we do that when we are adjured by the hon. Member for the Western Isles to support Lord Beaverbrook more strongly, when we are urged by the Secretary of State to forget all about deer forests and when even the hon. Member himself said that a lot of rot has been talked about deer forests in the past? I am tempted to look up the past files of "Forward," of which I have been and still am an ardent reader, and see exactly what sort of quotations I could get on that subject.
  The fact is that we are moving towards, and have got a long way on the lines of, an agreed policy upon agriculture; and it is not, I think—the Secretary of State would not claim that it was—the result of a single Government or of a single school of thought. He paid me a compliment—I was most glad to have it—for the work I was enabled to do in developing the marketing scheme. I was all the more glad to have it because when I was Minister of Agriculture I had the honour of being burnt in effigy, and that in my own country, for the promotion of the Milk Marketing Board, a body to which now everyone gives the strongest support. The task of pioneers is always stony and hard, and I have had my share of the stonings that meet the prophets on their way along that road.
  But here we are on a policy in agriculture which is more or less of an agreed policy, and that may well encourage us to proceed on our search for agreed policies on other matters. In this particular one of marginal land, we have not yet succeeded in getting full convergence upon it. It has not yet been fully agreed upon. The Secretary of State, as I have said, was a little curt with my hon. Friend the Member for West Perth when he dismissed altogether the part which the mountains of Scotland could play in their possible use as wedder farms. It is possible, as indeed the hon. Member for Accrington said, for a use to be made
  1638
  of the extreme hill lands in that matter. I would utter this caveat, however, that the danger in all these matters is that people go in for breeding stock on land which is fundamentally incapable of carrying milk animals. These are not areas which can carry milk animals. There is no drain in the world like the drain of a milking animal suckling its young; and it is that, among other things, which has gone far to reduce the fertility of much of the marginal land of Scotland and is responsible for a good deal of what is called the spread of bracken, which, in my view, could more properly be described as the death of grass.
  Mr. Brendan Bracken: I never heard of such a thing.
  Lieut.-Colonel Elliot: There is bracken and bracken. All bracken has certain similar characteristics. It is a hardy plant, deep-rooted, almost impossible to eradicate, with a certain rusty appearance at the top; but some of it can be put to great use. Some of it, on the other hand, is classified as a noxious weed. It depends to some extent upon the angle from which it is viewed. Viewed from the right, certain plants appear nobler and better than they appear when viewed from the left. Again, even in that I am sure that the convergence of view is appearing. I am speaking more particularly, however, of the hills of Scotland and those plants which are confined only to the hills and never leave those surroundings. That is often due to the strain that is put on land by the exhaustion of the fertility of the soil, caused, I personally believe, by the exhaustion of the minute-trace mineral elements of the soil faster than the rock by its natural decomposition can replace those elements.
  I would remind the House of one figure in this connection. It is that at this moment, in midsummer, the output of ewe milk is probably greater than the output of milk from the dairy cows throughout the whole country of Scotland. Those who know the very great amounts of lime phosphates and feeding-stuffs of every kind which have to be fed into the land to enable a dairy herd to maintain its milk yield must be appalled at the thought of this enormous extraction going on during the ewe-milk flush in May, June and July, from the

  1639
  hills of Scotland with practically no replacement put in for that which is being taken out.
  A big expansion of the use of marginal land would need to be paralleled, or indeed preceded, by a much more intense investigation of the quality of the soil which it is intended intensively to cultivate. Great danger might arise from the attempt to apply to the igneous rocks of the old Highland areas, lessons which have been learned in the South country here, where to tear up the herbage mat is to get at the fruitful soil underneath, whereas in our country to tear up the herbage mat, is often to get to soil which will grow only unnutritious grasses, weeds, rushes, and things which are of no use to anybody. The land will have been skinned, so to speak, and is not even as good as it was before being broken up.
  Marginal land is undoubtedly a source of wealth which can be developed. I am not sure that it can be developed by the use of the schemes which have already been mentioned. My hon. Friend has pointed out that in many cases the schemes were not economic. I have had the opportunity of looking at some of them. In some cases they meant an overhead of an extra £10 per ewe. There is no hill ewe in Scotland that can carry another £10 of overhead expenses. To do that and to expect any return from it is simply an illusion. It would break and ruin the farmer upon whom it was put. There are many things, such as service roads, which may properly be a burden, not on the farmer as part of his agricultural production but upon the community as part of the development of our land. I know many hill farms, and I am sure that my hon. Friend the Member for West Perth would cite many also, which are approached by hill roads constructed and maintained by the farmer at his own expense. Anyone knows, if he has to keep it up, the sort of burden represented by maintaining a hill road, and the sort of hole it makes in the profits or the prospective profits of any sort of farming enterprise.
  We have a proverb in Scotland that there are three ways of losing money: gambling, women, and farming your own land. Gambling is the quickest. Women is the pleasantest. Farming your own
  1640
  land is the most certain. It may well be said that some of the enterprises into which farmers have been lured by some of these grants are as certain, are almost as quick, and are much less pleasant, than any of the three ways which have been suggested.
  The Secretary of State spoke vigorously of the planning which was going on. There are some ways in which this planning may be carried to too great an extent. My hon. Friend the Member for West Aberdeen (Mr. Thornton-Kemsley) spoke of the evil anniversary of tonight, when the Town and Country Planning (Scotland) Act enters into its full vigour. I have referred to the development of hill farms. I know of a hill cottage at the foot of Windbrugh Hill on the road running over Limekilnedge. There is no other house for many miles around. It was my desire to place a dormer window in the cottage for the benefit of the shepherd living there. It would cost under £100 and therefore I thought no development charge was involved. It was being done entirely with my own money and therefore I did not require any sanction under the development agreement. In spite of that, I have had to submit a plan in triplicate not only to my county authorities but also to Edinburgh, showing the location of the dormer window and the size of the hole it was proposed to make in the room, and a site plan showing where the cottage was and its situation in relation to the mountainside. That is excessive planning. Those who would be inconvenienced by the sight of this dormer window are far less numerous than the clerks who will have had to deal with the application. This is an aspect of the matter to which the right hon. Gentleman might give his attention.
  There are other obstacles, too. I have tried to improve another cottage. It is the second year in which my efforts to do this, again entirely at my own expense, have been in progress. The work is now beginning to approach completion, but I have had to root out the good wood floors and replace them with cement floors, although trees are growing all round the place in great numbers and I have a sawmill in which I should be very ready to cut up the appropriate planks to fit into the cottage. These are examples of planning which is not of

  1641
  such great advantage to agriculture as the right hon. Gentleman might have us believe.
  Mr. McAllister: Can the right hon. and gallant Gentleman say who compelled him to submit those plans in triplicate? He knows that the insertion of a dormer window does not attract development charge and is not subject to applications of that kind. He should not make such statements about the Scottish office.
  Lieut.-Colonel Elliot: I am perfectly willing to give the hon. Member for Rutherglen (Mr. McAllister) the correspondence which I have brought down here. There is a letter from the clerk to the county council saying that not only had he to see it, but that it had to go to Edinburgh. There is no doubt about this at all. Like the hon. Member, I could not believe it, but I had to believe the testimony of my own eyes. It is that no doubt which is referred to in paragraph 53 of the White Paper, where it says about the Town and Country Planning Act that:
  "Attention has … been concentrated on drawing up the regulations prescribed by the Act and on making the effects of the Act and of these regulations known both to the local authorities who will administer them and to the public who will be affected by them."
  This was done. I am not misleading the House in the very slightest.
  I have already trespassed more than I should have done on the time of the Joint Under-Secretary. I extend to him a most heartfelt apology. We have had not only a valuable Debate in itself but a valuable Debate in the temper in which it has been conducted. Admittedly, Scottish hon. Members when they are good are very, very good and when they are bad they are horrid. On this occasion they have been very, very good. All of us may therefore, I hope, take some small share of credit for the harmonious and fruitful progress of the Debate.
  9.40 p.m.
  The Joint Under-Secretary of State for Scotland (Mr. Thomas Fraser): As many other hon. Members have said, we have had a useful Debate, and one in which tempers have not been so strained as on other occasions. May I observe that the right hon. and gallant Gentleman himself is in much better temper tonight than he was less than 24 hours ago?
  Lieut.-Colonel Elliot: There is no scandalous misuse of the House tonight.
  Mr. Fraser: The right hon. and gallant Gentleman seems to have had a sleep since then. However, he has gone a little astray even this evening, because he said that the need to submit a plan for his dormer window was made necessary by the Town and Country Planning Act, 1947. If he looks at his correspondence again, I think he will find that the need to do so did not arise from that Act. I do not know which Act provided for this being done, but I believe it goes back as far as 1932; in any case, I had to do something like the right hon. and gallant Gentleman has done before the 1947 Act was put on the Statute Book, and it is because I have had that experience, that I know this was not begun by the legislation of the present Government.
  Mr. Thornton-Kemsley: Why did you not stop it in the 1947 Act?
  Mr. Fraser: Because it is not a bad thing that the planning authority should know what sort of windows the right hon. and gallant Gentleman or the hon. Gentleman are proposing to put in their houses.
  The right hon. and gallant Gentleman made some interesting observations on the drain on the grasslands of our hills by mother sheep, and seemed to be saying in his little explanation of the more serious drain by the breeding ewe than by a wedder, that the Secretary of State ought to look with considerable sympathy on the proposition made by his hon. Friend the Member for West Perth (Mr. Snadden). However, he did not say where he stood in this matter—whether he thinks that the Government ought to provide further inducement to the farmers in the north of Scotland to put wedders on the hills or the deer forests. Every time I have gone up to the north of Scotland in the last four years I have had discussions with farmers about the use to which the deer forests ought to be put. Some experienced farmers there have said that of course the Government should give some special subsidy to enable the farmers to put wedder lambs on the deer forests, and equally experienced farmers have said that the Government would be just throwing good money after bad in doing anything of the kind.

  1643
  It has been said tonight by Members opposite in reply to a challenge made by this side of the Committee, that they were not asking for more subsidies. If the other side of the Committee are not asking for more subsidies then I ask them what steps they want my right hon. Friend to take to ensure that wedder lambs will be fed on the deer forests in the north of Scotland?
  Mr. Snadden: Could I answer that important point? What I said was that the only contribution which the many millions of unimprovable grassland in Scotland can make is through wedder sheep, because nothing else will live on that land, and it seems wrong that it should not be contributing something today. It could be greatly helped through a wool incentive because wedder sheep depend greatly on whether or not wool is prosperous. It might involve a guaranteed wool price, which the present Government will not give.
  Mr. Fraser: That was exactly my difficulty. I listened with great care to what was in many ways an interesting speech from the hon. Gentleman, but he wanted this long-term plan—
  Mr. Snadden: The alternative is nothing.
  Mr. Fraser: He wanted this long-term plan, completely ignoring the long-term plan of the Government, completely ignoring all the assurances and guarantees that have lead to this revivalist spirit in Scottish agriculture referred to by the hon. Member for East Fife (Mr. Henderson Stewart). The hon. Gentleman ignored all that. I say this to him, that if there are so many thousands of acres of hill land good for nothing else but feeding wedders, why do not those wise old farmers in the north of Scotland—his own friends and colleagues—put the wedders on it? My right hon. Friend is not stopping them. The fact is that on most of those lands—and particularly can this be said of the deer forest land—the danger of losses in wintertime is considerable. In any case, what advantage is there in it?
  One hon. Member opposite, in referring to wedders, talked about putting on a breeding stock of wedders—which seems to show a slightly less knowledge of agriculture than one would expect hon. Members to have who participate in these
  1644
  Debates. But in any case I have not seen a breeding wedder. I should like to be shown one some day if any hon. Member would like to take me along to a farm. These hill farmers in the north of Scotland send the wedder lambs to market. Very often they are fattened on the lower lands and we get about 30 to 40 pounds of meat from each of them killed as a lamb. It is suggested by a lot of people that instead of doing that, the farmer should take these wedders and put them on to the deer forests and feed them there for three years. At the end of that time, if the sheep are still alive, we would get something like 60 to 70 pounds of meat from each of them. The shrewd farmers in the north of Scotland are not prepared to take that risk or gamble. It may be that if we could do without meat for the next few years that could be done, but we understood that the Opposition thought that the meat ration was small enough at present.
  Mr. Thornton-Kemsley: Do not you think so?
  The Deputy-Chairman: The hon. Gentleman twice has referred to the Joint Under-Secretary as "you." He must address the Chair.
  Mr. Thornton-Kemsley: I am so sorry. Do not you think so, Mr. Bowles?
  Mr. Fraser: If the meat ration is too small now, how much smaller will it be if we are to take as many as we can of the wedder lambs in Scotland and put them on to deer forests, keeping them there for three years before we kill them to eat them? Manifestly, our meat ration will be very much less. As I have already said, my right hon. Friend takes no steps whatever to prevent the farmers who wish to do so from feeding their wedders on the hill lands. Indeed, my hon. Friend the Member for Accrington (Mr. Scott-Elliot) told us some of his experiences in this respect.
  The hon. Member for West Perth (Mr. Snadden) in asking the Government to declare a long-term policy for beef production, himself, in the course of his cataloguing of his positive and constructive suggestions, did nothing more, I am sorry to say, than to say to the Government, "Give to the beef producers, the beef feeders, in Scotland more money and more feedingstuffs." That was the

  1645
  long-term policy. He mentioned the various subsidy schemes and wanted minor modifications and alterations but, running through his remarks all the time, there was the suggestion that there must be more money paid in subsidies to the producers. And, of course, he wanted feedingstuffs. He knows full well that we should be only too glad to provide additional feedingstuffs if we could get them. There is no point in my making the case all over again. We just cannot find the dollars to buy the feedingstuffs which hon. Gentlemen opposite are asking us to buy to feed the cattle in Scotland. We just have not got the dollars with which to make the purchases.
  There has been a lot of discussion about the deer forests. As some hon. Members have said, we have something like three million acres of deer forest land in Scotland. My right hon. Friend admitted straight away that a lot of wild and woolly remarks have been made in the past about the deer forests. He expressed great surprise that these wild and woolly charges should be repeated by those who resented such allegations in the past. During the war the Scottish Land Court made a survey of the deer forests in the north of Scotland. They made an estimate of the capacity of the deer forests to carry cattle and sheep. They thought that some 7,000 cattle and 200,000 sheep could be carried. Of these, only 1,500 cattle and 110,000 sheep were to be wintered.
  My right hon. Friend does not take the view that the capacity of the deer forests to produce food is that and no more. Indeed, we believe that it is very much more than that, but let us see how we are moving. In 1939, in the deer forests, there were 1,593 cattle and 50,426 sheep. Despite the loss of 40,000 sheep in the bad winter of 1947, we had in the deer forests in 1948 no fewer than 119,972 sheep. In regard to cattle, despite a loss of just over 400, we had 2,492 cattle as against 1,593 in 1939.
  A lot more can be done, and my right hon. Friend will indeed say that a lot more must be done, but he will continue to appreciate the difficulties which very largely centre around winter keep. The hon. Member for West Perth talked about his own difficulties in his scheme on his farm in Perthshire, but his diffi-
  1646
  culties are as nothing compared to the difficulties in Western Inverness, Western Ross and Sutherland. The provision of winter feed is nothing like as serious a problem in Perthshire as it is in those parts along the West coast of Scotland—Argyllshire, Western Inverness, Western Ross and Sutherland. If we could have plenty of oat straw and turnips to feed in the winter, there is no saying how many more tens, if not hundreds, of thousands, of cattle we should be able to feed in northern Scotland, but my right hon. Friend has got the right conception in saying that we are moving to take these highlands and improve the fertility of the soil there, so as to marry agriculture and forestry, build shelter belts in order to drain the land in that way, and so push the cultivation further up the hill. By doing so we may be able to produce a few turnips or make winter grazings, or we might be able to produce a little oat straw to feed to the cattle in the winter months.
  That is the kind of approach which my right hon. Friend is making to this problem, and he realises the difficulties, as the hon. Gentleman himself must do. If the hon. Gentleman is criticising my right hon. Friend, or if he is criticising Scotland, for having fallen down on the job, he must really allow my right hon. Friend to say that he is criticising his own colleagues and farmers in the north of Scotland, because he is not criticising anybody else. They know their job, and the agricultural executive committee is likely to be a body composed of men experienced in farming in northern Scotland who also know their job and who are doing the best they can to increase food production there. They have made some headway, and we ask them to go on and realise that there is no end to the increase in food to be produced from the land not only in northern Scotland but over Scotland as a whole.
  The speech of my right hon. Friend this afternoon was an excellent exposition of what has been happening in Scotland in recent years, and presented a picture of which all of us ought to be proud. Nevertheless, it must not be thought that he is guilty of complacency in the matter. We are pressing on with our agricultural expansion programme, and we appreciate to the full that the Government, for their part, must leave no stone unturned to assist the farmers to get the best possible

  1647
  production of food from the soil of Scotland.
  I shall now turn for a minute to the hill farming improvement schemes. The hon. Member for East Aberdeen (Mr. Boothby) said that 61 schemes had been approved, and that he thought that a very poor record. I merely give these figures because I think it better that we should know where we are going, and that the public should not get any false impression of what has happened under the Hill Farming Act. By the end of May of this year, the total number of hill farming schemes submitted in Scotland was 795. Many of those schemes were found to be on land which was not really hill farming land at all; indeed, 139 of the schemes, in the view of my right hon. Friend and his advisers, came into that category. The remaining 656 schemes, however, related to some 984 farms, covering an area of 2,225,000 acres and involving work estimated to cost over £2,500,000. So far, 292 schemes, estimated to cost £1,500,000, have been approved.
  Lieut.-Colonel Elliot: I took down the figures given by the right hon. Gentleman the Secretary of State for Scotland; it was he who gave the figures of 795 schemes, and 68 approved. They are the figures I wrote down.
  Mr. Fraser: There is a mistake; I do not think that my right hon. Friend said that 68 schemes had been approved. The hon. Member for East Aberdeen certainly said that 61 had been approved.
  Lieut.-Colonel Elliot: I wrote down the figures as the right hon. Gentleman gave them. They were 68 approved, and the others in various stages. Those were the figures he gave the Committee.
  Mr. Fraser: My right hon. Friend will no doubt check up the figure he gave. In any case, we shall see it in the OFFICIAL REPORT tomorrow, but, if there is any doubt about what he said, that is all the more reason why I should make the position clear now. I repeat that 292 schemes have been approved. In the Highland area, with which so many hon. Members opposite are concerned, we have no less than 105 schemes already approved, which are estimated to cost £400,000.
  1648
  There is one other matter to which, perhaps, I should refer before we finish. My right hon. Friend has been criticised for not doing little things, but only big things. Let me mention one little thing of very considerable importance, particularly to the Highland area of Scotland. On 18th May my right hon. Friend announced the putting into operation of the new scheme of grants for the rebuilding, replacement and improvement of crofters' houses and farm buildings. This announcement has already brought forth some 350 applications for assistance under the scheme. They are for the erection or improvement of 130 houses and 25 other buildings, and the remainder are for the improvement of existing houses and buildings.
  I wish to call the Committee's attention to the fact that, in this case, there is provision for grants of loans for steddings as well as for houses, so that at the present time we are taking a very special step to encourage the small man in the Highlands who is raising his cattle and his sheep to put his whole house in order, not only his own private house, but his farm buildings as well. In that and in many other ways I feel sure that my right hon. Friend can feel satisfied that he is making a contribution to well-being and prosperity in the north of Scotland, as in other parts of Scotland, which will go on the record as being quite unequalled by anything that any previous Secretary of State for Scotland has done.
  It being Ten o'Clock, The CHAIRMAN left the Chair to report Progress, and ask leave to sit again.
  Committee report Progress; to sit again To-morrow.

  RURAL HOUSING
  Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Snow.]
  10.1 p.m.
  Mr. Baldwin: It seems appropriate that I should be following with an Adjournment Debate on very much the same sort of complaint as those to which I have been listening during the Scottish Debate. I want to call the attention of the House to the delay in building rural cottages and, in particular, the delay in building cottages for farm workers. I know that I shall be faced

  1649
  with a history of what has been done in the way of building houses in rural districts; I shall be given figures to prove what a tremendous amount of work has been done. The fact remains, however, that the number of agricultural workers who have had houses built for them in rural areas is extremely small. In many instances where those cottages have been let to farm workers, there is no certainty that those workers will remain on the land after they have been given a cottage.
  I know that some rural district councils have been very lucky in their efforts, but some have been very unlucky. If the Parliamentary Secretary is going to say that the delay in building these cottages is due to the rural district councils, I will suggest in advance that it is the duty of the Ministry of Health to see that these rural district councils get on with their job of building houses. It is always difficult in these Adjournment Debates to foresee the arguments that will be advanced against any case that is brought forward. In fact, they are hardly Debates: there is generally a statement on one side and a contradiction on the other. I often wish we could have 10 minutes each way for question and answer. Then it would be a real Debate.
  I want particularly to stress the importance of farmers getting houses out in the countryside which are reasonably near to the work which the men have to do, instead of having these houses built in villages far from the work which has to be done. At the present time in isolated parts of the country, such as where I live, we have to depend very largely on casual labour. We have, living under not very good conditions, many Germans who were prisoners of war and who have now been civilianised; they live, as we call it in the country, "a bit rough," but they are doing a good job of work. They will not stay here for ever; eventually they will want to go back to their own country.
  We also have to depend on the workers in the hostels which are placed around the countryside. We have to pay these hostel workers 10s. a week more than our skilled men. They are entirely unskilled; very often they are thoroughly inefficient and generally they leave their work around harvest time when the work is in full swing. The cost to the farmer is generally anything up to 15s. to £1 a
  1650
  week more than the cost of his own skilled man. We want to get some cottages out in the countryside so that we can do away with this inefficient, unskilled labour and get back to the days when we could put reliable men in these houses—men who understood the job.
  I want to give the House a little of the history of some of these delays, because it may be suggested that I am not being quite accurate. I will give two instances—first of all, the case of the Kington rural district council. They selected the sites for cottages in four villages as far back as April, 1943. In July, 1944, the Ministry of Town and Country Planning and the Ministry of Agriculture agreed that the sites were all right. In February, 1946, the authority received from the Ministry of Health permission to get some tenders. In May tenders were accepted by the council and submitted to the Ministry. The regional water engineer looked into the water supplies, and into the provision of sewers and roads. From then onwards there was considerable correspondence until in May, 1947, the inspector reported that the supplies of water were not satisfactory. The Ministry of Health, in June, 1947, reported that the water supplies at another site were insufficient. So it went on.
  In February, 1948, tenders were again invited, and the Ministry considered they were too high. Revised prices were obtained and sent to the Ministry in March, 1949. This time the Ministry replied that they thought the tenders were too low. They suggested to the rural district council that it should take a bond from the builder tendering for the cottages because they did not think he would carry out the work. Incidentally, the builder is one of the biggest builders in my constituency. His is a most reliable firm. I have here two pages of notes that tell a story of frustration starting in 1943, and there is not yet one single brick put down. This is because licences are not issued to private builders unless this ridiculous ratio of one in five is observed, and the result is that the people who want to build the cottages cannot obtain the licences because the rural district council has not erected its quota.
  I have a sample here of the sort of correspondence that goes on concerning this business. One individual farmer

  1651
  wanted to get permission to build one house for his stockman. The site was approved, and everything was in order, except that he could not get the licence to build. He wrote to me about it a few days ago, saying:
  "It looks as though I shall have to go without the cottage for some considerable time, and I only hope my herdsman does not leave me when I break the news to him."
  The farmer wants to build a decent house to replace one which has been condemned. He cannot because of the ridiculous ratio of one in five.
  I have another case here concerning a district in Herefordshire and the rural district council of Preston Wynne. This case has not been running quite so long—only three years. However, not one single brick has been put on the ground yet. The case starts off with the usual old muddle. A lady member of the council writes:
  "It is only fair to say that up to 1945 we had not been very active because the clerk was away on war service, but you will see from the history attached that the original delay was due to Ministerial disapproval of the site."
  The same performance went on in this case as the other. The site was approved and then turned down. The merry-go-round went round and round. The lady councillor writes:
  "This delay means that in April, 1949, we are asked more for an inferior house than we should have had to pay in October, 1948, which was too dear for the Ministry to accept."
  These are fantastic things that are going on, and I appeal to the Ministry of Health to cut loose from the red tape, to allow the people on the spot, who know where they want their houses built, and who know whether the sites are right or not, to get on with their job. I appeal to the Ministry to stop this ridiculous frustration.
  I have a letter from a farmer friend, who lives in that district. I sent to him a letter from the Parliamentary Secretary in which the plea was made that the reason for the delay was that the site was very isolated. It is worth noting that even if districts are isolated farmers are supposed to live in them to produce food, and we have to have cottages in those isolated districts. I should have thought myself that if a district was isolated there was all the more reason for pressure to be put on the Minister of Health to have houses built in it. This farmer says:
  1652
  "The history of the last three years has been one of muddle, complacency, inefficiency and drift."
  The Ministry may say that this place is isolated and in an out-of-the-way part of the world, but the farmer is turning out over £100 gross per acre, and he cannot continue to do that unless he gets some cottages. The Minister calls this isolated: it is half a mile from the school by road and 600 yards by footpath, five minutes from the village hall, 200 yards from the local bus route and 300 yards from the main Hereford bus route. I can show the Minister much worse places than that. The effect is that no one in that area who wants to build a house for one of his men can get a licence to do so, because the rural district council have not been allowed to get on with their job.
  Let me now refer to a rural district council which has got on with the job. I want to refer to this council because some of its members rather took me to task after a housing Debate in which I mentioned the high rents they were charging for their houses. I was challenged by the Minister of Health to give the name of the council and I gave it—the Leominster Rural District Council, who rather thought that I was making an attack on them because of the high rents they were charging. I was doing nothing of the sort. They must charge high rents when they have to pay an extravagant price for building the houses. Here is a district council which under contract has built or agreed on 90 houses. In spite of the fact that this rural district council has built all these houses there are still 15 people who want to build cottages for their men. They are still on the waiting list and cannot get a licence, despite the fact that the district council has built all these cottages.
  I appeal to the Minister to abandon the idea that we want only council houses in this country. Surely now, four years after the war, it is time that people who want to build a house should be allowed to do so where they think it is necessary. I do not believe in ribbon development, but I think the local people can decide about that. These people should be entitled to build the houses where they want them, on the farm or in the village. Let the men who have to build the houses and the men who have to live in them decide where the houses should be built.

  1653
  We live in this wretched age of over-planning; we are planned from before birth until we get into the grave. We shall soon have our coffins marked "O.H.M.S."
  I wish the Minister would give us some freedom to build these houses. To say houses must be built in villages because of what are called "amenities" is sheer nonsense. The farmers themselves have to live on the land; the farmers' wives want amenities; they want running water and electric light. If these amenities can be put into the farmhouses they can be put into the cottages for the farm workers. There is no need to build cottages in the villages merely for the sake of amenities.
  I assert that it is necessary for the man who is bringing the money into the home to have a house close to his job, so that if in going to work in the early morning he gets wet he can go home, get a change of clothing, and lose very little time getting back to work. Because of this system of herding people together in villages some farm workers have to cycle two, three and four miles to their work; they never have a hot meal in the middle of the day; and if they get wet early in the morning they have either to work in wet clothes all day long, or else leave their work for a long period. On Sundays herdsmen, who have to go to work in the morning, in the middle of the day, and again in the evening, have to cycle many unnecessary miles. I do plead with the Parliamentary Secretary to tell his Minister that the time has come when we should be entitled to build a house where we want it. If we build it in the wrong place we must suffer, not the Ministry of Health or the council. But we shall not build a house where we cannot get a man to live in it. We know something about our job, and we only ask that we should be entitled to do our job.
  Two years ago, in August, we ran into an economic crisis. I well remember the Prime Minister making a statement in the House then on the importance of agricultural production. He stressed the importance of increasing our output. We are again getting into an economic crisis. No matter what the Chancellor of the Exchequer may say, all the signs are that circumstances may force us to devalue the pound. If the pound is devalued, I want the country to realise what it will
  1654
  cost to buy food from abroad. I want the country to look at this question of increased agricultural production from the economic point of view.
  We are today spending capital on building new towns. We have more new towns in Great Britain than we can sustain, and in a few years we shall find that out. We are wasting money building new towns. That building could be taking place in the isolated and marginal land parts of the country. Thousands of pounds are being spent on Mobberley, which is to take the overspill of Manchester. I suggest that that money should be spent in the Welsh hills, to get them populated and to get more food for the people to eat. I suggest it should be spent on an estate which has just come into the hands of the nation, where people are living almost under the conditions of cave dwellers. If this job is not tackled and tackled well, the country will be very much more hungry than it is at the present time.
  10.18 p.m.
  The Parliamentary Secretary to the Ministry of Health (Mr. Blenkinsop): The hon. Member for Leominster (Mr. Baldwin) has concentrated a large part of his attack on the policy of the Government in developing housing in rural areas in village communities wherever that is possible. In doing so, the Government are following the recommendations made in 1944 by the Dudley Committee, which had this to say on the siting of farm houses and farm cottages:
  "We recommend that new cottages in rural districts built by local authorities should be situated in or adjoining existing villages or hamlets. We know that the inter-war practice of scattering new cottages about the countryside sprang from the desire to house the worker within easy reach of farms. With better transport and higher wages we do not think that this reason is any longer valid. In our view, it is far better that the worker should have to travel some distance to his work than that he and his family should be remote from the school, church, shops and all the other amenities of village life."
  I believe that the Government have been entirely right in concentrating the building of new houses, so far as they can, around existing villages and hamlets.
  The hon. Member said that he would probably be met in reply to his speech with some figures about what has been done in the rural areas since the war. I should be very sorry to disappoint him

  1655
  by not giving him some of that information, because it is a record of which we can be properly proud, although we realise the immense task which is still before us. We have achieved, since the end of the war and up to the end of March this year, the building of some 92,000 permanent houses in the rural districts. A large part of these have, of course, been built by the local authorities, in striking contrast to the inter-war position where very few houses were built by the local authorities in the rural areas, with all the consequent evils which we know so well in the countryside.
  Today, rural districts are ahead of the rest of the country in post-war building of permanent houses, if we take the number of houses completed compared with their population. By 31st March this year some 21 per cent. of post-war permanent houses had been built in rural districts which contained only 17.6 per cent. of the population. As I said, between the wars local authority building in rural districts accounted for only 19 per cent. of the total; it now represents 75 per cent., and this represents a very important change because it has meant providing houses, as I shall show, for the needs of agricultural workers and rather fewer for the needs of the week-end admirer of the countryside, for whom very adequate provision used to be made in the inter-war years.
  One very interesting fact is that houses are being built now in rural areas on much more suitable sites for rural workers than those on which they were built by private enterprise in the inter-war years. Part of the problem of getting ahead in rural areas as fast as we would like is due to difficulty of getting suitable sites on which houses have to be built and also of trying to get reasonably-priced tenders which would enable houses to be let at rents which agricultural workers can afford to pay. In many cases there are also problems of water supply and flooded land—difficulties of the special areas of which the hon. Member for Leominster has particular knowledge.
  Lord Willoughby de Eresby: The hon. Gentleman mentioned the larger percentage of houses which have been built in rural areas as opposed to urban areas. I am
  1656
  certain he realises the importance of the number actually occupied by agricultural workers. Can he give us any information?
  Mr. Blenkinsop: I am coming to that. Rural councils were asked, towards the end of 1947, to give priority to agricultural workers, in consultation with agricultural executive committees, where that was possible. This priority has proved very effective. Of the applicants for houses in rural districts without separate homes now on the waiting lists agricultural workers represent about one in 10, whereas they have secured one in every four of the houses built by local authorities in those districts up to the end of March. Some 15,000 local authority built houses have been let to agricultural workers in that period.
  Mr. Baldwin: Has the hon Gentleman any means of knowing whether the houses are still occupied by agricultural workers? Many people might put themselves down as agricultural workers with a view to getting a cottage, but would not necessarily stay in the cottage unless there was something which would keep them in the district.
  Mr. Blenkinsop: There may be some movement around, but our information does not suggest that there is any overall diminution; rather it is the opposite. The total number of houses being occupied by agricultural workers, out of those being built by local authorities, is steadily increasing. We have had a tribute from the Agricultural Workers Union to the very valuable development which is taking place in rural areas in this field. This concentration of houses for agricultural workers is being encouraged by the much larger subsidy which is offered to local authorities for agricultural workers' housing.
  Mr. Baldwin: I should like to ask the hon. Gentleman a rather important question. Are any steps taken to ensure that this extra grant to rural district councils for houses let to agricultural workers, is in fact, used for that purpose? My experience is that very often it is averaged out, with the result that agricultural workers do not reap the benefit of the reduction.
  Mr. Blenkinsop: We take great pains to see that the houses on which the special subsidy is claimed are properly set aside for the use of agricultural workers; but

  1657
  I do not deny that agricultural workers may move from one house to another. I agree that some local authorities average out the extra subsidy over other houses they have built—we do not prevent their doing so; that is something local authorities themselves must decide. But in one of the cases to which the hon. Gentleman referred the extra value of the subsidy obviously has been given to agricultural workers living in those houses, for there is a noticeable reduction in the rent which is being asked. There is no doubt that this extra subsidy has encouraged the provision of further houses for agricultural workers.
  I should like to refer briefly to the two cases to which the hon. Member has referred—Hereford Rural District Council and the Kington Rural District Council. It is true there have been long and exceptional delays because of the very real difficulties which the councils in that area have had to face. I have examined the timetable of their housing schemes very carefully. No complaint can be laid against the Ministry for the slow development of these schemes, much as we regret it. Indeed, all the time the pressure has been from the Ministry. I appreciate, however, from the council's point of view, the peculiar difficulties of the sites with which they have had to deal; the problems of flooding of land, which has been a very real one, of the high cost of securing water for the houses, chlorination and so on, which undoubtedly have increased the cost of the houses.
  1658
  I think the hon. Gentleman would agree, however, that in both the cases to which he has referred there is a real prospect of these schemes developing as a result of the pressure from, and the co-operation of, the Ministry's officials. The hon. Member himself would be the first to say that our officials and regional officers have given every possible assistance to secure a satisfactory outcome and, above all, to ensure that the houses being erected in those districts are built, as far as we can possibly ensure, at prices which agricultural workers can afford.
  We are proud of the number of houses built throughout the country since the end of the war, but we fully appreciate the need for more. For the reasons I have mentioned, we still insist that it is right to concentrate, at any rate in the first place, on building houses as far as possible in the local villages and hamlets rather than concentrate the whole of our attention on outlying areas. While taking pride in what has been done, the Government will continue to press forward to relieve the great shortage in rural areas, which is partly the effect of what has not, unfortunately, been done for agricultural workers in the past.
  Question put and agreed to.
  Adjourned accordingly at Twenty-nine Minutes past Ten o'Clock.

  EDUCATION (COST)
  EDUCATION (COST)
  SOUTH AFRICA (CITIZENSHIP)
  SOUTH AFRICA (CITIZENSHIP)
TRADE AND COMMERCE
  World Trade (Encouragement)
  World Trade (Encouragement)
  Utility Furniture (Woodworm)
  Utility Furniture (Woodworm)
  Hardwood
  Hardwood
  Newspapers (Distribution)
  Newspapers (Distribution)
  POLICE AND FIRE SERVICE (RADIO)
  POLICE AND FIRE SERVICE (RADIO)
  YOUNG PERSONS (IMPRISONMENT)
  YOUNG PERSONS (IMPRISONMENT)
  CATS (MEDICAL RESEARCH)
  CATS (MEDICAL RESEARCH)
  CHANNEL ISLANDS (CIVIL CLAIMS)
  CHANNEL ISLANDS (CIVIL CLAIMS)
  GOWERS COMMITTEE (REPORT)
  GOWERS COMMITTEE (REPORT)
NATIONAL HEALTH SERVICE
  Hospital Admission (Acute Cases)
  Hospital Admission (Acute Cases)
  Hearing Aids
  Hearing Aids
  Hospitals and Clinics (Costs)
  Hospitals and Clinics (Costs)
  British Hospitals Overseas
  British Hospitals Overseas
  Mental Nurses
  Mental Nurses
  Spectacles (Supply)
  Spectacles (Supply)
  Spectacle Repairs
  Spectacle Repairs
  Hospital Estimates
  Hospital Estimates
HOUSING
  Contracts
  Contracts
  Galvanised Piping
  Galvanised Piping
  Eviction, Brighton
  Eviction, Brighton
  District Nurses
  District Nurses
  Non-Traditional Houses (Grants)
  Non-Traditional Houses (Grants)
PUBLIC HEALTH
  Doctor (Registration Application)
  Doctor (Registration Application)
  Broadmoor Institution (Staff)
  Broadmoor Institution (Staff)
  FLOODING, LEWISHAM
  FLOODING, LEWISHAM
  WATER SUPPLY (DOWSERS)
  WATER SUPPLY (DOWSERS)
AGRICULTURE
  County Committees (Direct Farming)
  County Committees (Direct Farming)
  Combine Harvesters (Sacks)
  Combine Harvesters (Sacks)
  Cattle and Sheep, Exmoor
  Cattle and Sheep, Exmoor
NATIONAL FINANCE
  Income and Expenditure (Table)
  Income and Expenditure (Table)
  Bank Rate
  Bank Rate
  Subsidies
  Subsidies
  Income Tax
  Income Tax
  GOVERNMENT OFFICES (MARRIED WOMEN)
  GOVERNMENT OFFICES (MARRIED WOMEN)
EMPLOYMENT
  Elderly Persons
  Elderly Persons
  West Indian Workers
  West Indian Workers
  COLONIAL EMPIRE (BROADCASTING)
  COLONIAL EMPIRE (BROADCASTING)
  INTERNATIONAL REVIEW "KNOWLEDGE"
  INTERNATIONAL REVIEW "KNOWLEDGE"
  ANTHRACITE SUPPLIES
  ANTHRACITE SUPPLIES
MINISTRY OF WORKS
  Office Building
  Office Building
  Food Office, Chiswick
  Food Office, Chiswick
BRITISH ARMY
  Overseas Draft (Embarkation Leave)
  Overseas Draft (Embarkation Leave)
  Overseas Service (Training)
  Overseas Service (Training)
  Requisitioned Premises, London
  Requisitioned Premises, London
  PHARMACEUTICAL PREPARATIONS (SUGAR)
  PHARMACEUTICAL PREPARATIONS (SUGAR)
  ENGLISH CHANNEL (OIL DISCHARGE)
  ENGLISH CHANNEL (OIL DISCHARGE)
  WEST INDIAN SHIPPING SERVICES
  WEST INDIAN SHIPPING SERVICES
Preamble
The House met at three of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers

  HOUSE OF LORDS OFFICES
  THE CHAIRMAN OF COMMITTEES (THE EARL OF DROGHEDA): My Lords, I beg to move that Lord Badeley be added to the Select Committee on the House of Lords Offices.
  Moved, That the Lord Badeley be added to the Select Committee on the House of Lords Offices.—(The Earl of Drogheda.)
  On Question, Motion agreed to, and ordered accordingly.

SUPERANNUATION BILL
3.5 p.m.
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—(Lord Pakenham.)
On Question, Motion agreed to.
House in Committee accordingly:
[The EARL OF DROGHEDA in the Chair]
Clauses 1 to 25 agreed to.
Clause 26 [Avoidance of nominations]:
THE MINISTER OF CIVIL AVIATION (LORD PAKENHAM)THE MINISTER OF CIVIL AVIATION (LORD PAKENHAM) moved to leave out subsection (4). The noble Lord said: I hope the Committee will allow me to speak to the first two Amendments standing in my name together. Noble Lords will remember that Part II of the Bill proposes a contributory scheme whereby civil servants can provide for dependants, other than widows and their own children, up to a maximum of three. Subsection (4) of Clause 26, which it is now proposed to omit, was designed to cover such a case as that of a woman civil servant who had nominated two or three children other than her own—the maximum, as I have said, being three—and had later married. The marriage of itself would not invalidate these nominations, as would be the result in the case of a man nor would the birth of a child by that marriage, unless her husband was incapable
618
of providing for the child to that the child was dependent on her. But once she has a child of her own who is dependent on her—for example, on widowhood—then under subsection (3) of Clause 23, the existence of a dependent child of her own automatically invalidates the earlier nominations she had made.
The object of this Amendment, which gives effect to the original purposes of the clause is to make provision for the case where a civil servant is bona fide unaware of these consequences until death or retirement, when it is too late to correct the situation. The proposed new subsection to Clause 27 makes provision for such a case by allowing the Treasury in such circumstances to direct that the same results are to follow as if the nominator had taken immediate steps as soon as she had a dependant of her own, to nominate her own child and such of the other children as were within the quota of three. This Amendment is to correct a minor technical defect in the clause. I beg to move.
Amendment moved—
Page 20, line 36, leave out subsection (4).—(Lord Pakenham.)
On Question, Amendment agreed to.
Clause 26, as amended, agreed to.
Clause 27 [Renominations of nominees under previous nominations which have become void]:
LORD PAKENHAM: This is the Amendment which connects with the Amendment which we have just carried. I beg to move.
Amendment moved—
Page 21, line 9, at end insert—
("(2) Where a nomination validly made has become void at any time on the ground that a child of the nominator might then have been but was not a nominee of his and the nominator has died or retired without having made a new nomination, the Treasury may, if in the circumstances they think fit so to do, direct that the provisions of this Act shall have effect as if the nominator, immediately after the event by which the nomination was avoided, had nominated the person who was the nominee under the nomination (or, where more than one nomination was avoided by that event, such of those persons as may be specified in the direction) and had also nominated his child.")—(Lord Pakenham.)
On Question, Amendment agreed to.
Clause 27, as amended, agreed to.
Clauses 28 to 35 agreed to.
Clause 36 [Additions to pensions, etc., for service after retiring age in certain cases]:
LORD PAKENHAM: This Amendment also corrects a technical defect in the clause, as it appeared hitherto. The intention of subsections (7) and (8) was to enable any person who had rendered service after the retiring age before the passing of the Act and who was in post on or after December 3, 1948, to count any such service. Your Lordships will observe that it makes provision for civil servants to count such service for pension if the retiring age was reached after December 3, 1948, but before the passing of the Act. There is at present a small gap. This Amendment remedies the anomaly and enables such service to count. I beg to move.
Amendment moved—
Page 30, line 28, leave out from ("Act") to ("the") in line 29.—(Lord Pakenham.)
On Question, Amendment agreed to.
Clause 36, as amended, agreed to.
Clauses 37 to 44 agreed to.
LORD SCHUSTER LORD SCHUSTER moved, after Clause 44, to insert the following new clause:
Provision for computing amount of superannuation to persons holding professional and other special offices.
"—(1) This section applies to employment in any such office or class of offices as the Treasury may by Order specify as being of such a nature that, for the due and efficient discharge of the duties thereof, such professional or other specialised qualifications or experience not ordinarily acquired in the civil service as may be specified in the Order are required, and that it is in the public interest that persons should be appointed thereto at an age exceeding that at which persons ordinarily become civil servants.
(2) When a person is admitted to the civil service with a certificate from the Civil Service Commissioners for the purpose of undertaking employment to which this section applies, the said certificate shall specify the number of years spent in acquiring such professional or other specialised qualifications or experience as aforesaid by that person while between the ages of twenty and forty years and before the date of such admission:
Provided that for the purposes of any such certificate no account shall be taken of any years in respect of which any such person at the date of his admission to the civil service is entitled under any superannuation scheme to a superannuation allowance or other money payment on attaining the appropriate age specified in that scheme.
(3) Subject to the provisions of this section, in computing the amount of any superannuation allowance, additional allowance or
620
gratuity in the case of a civil servant who was recruited for employment to which this I section applies, there shall be reckoned in addition to the number of years which would, apart from this subsection, fall to be reckoned for any of the purposes aforesaid—

(a) if he has attained the retiring age, the number of years specified in the said certificate from the Civil Service Commissioners; or

(b) if he has not attained the retiring age, a proportion of that number varying with the number of years of his actual service:

Provided that this subsection shall not apply to any person in respect of whom the Treasury has directed that he shall be subject to the provisions of subsection (1) of section two of the Superannuation Act, 1946 (which enables the service of certain late entrants to the Civil Service to be reckoned at eight fifths of its actual length) and whose service would be of greater length, if reckoned in accordance with that subsection, than if reckoned in accordance with this subsection.
(4) The Treasury may make rules for securing that, in such circumstances and subject to such conditions as to proof of professional or other qualifications or experience and of such other matters as may be specified in the rules, the amount of any superannuation allowance, additional allowance or gratuity in the case of any person who at the date of the passing of this Act is a civil servant and employed in employment to which this section applies shall be computed in accordance with the provisions of subsection (3) of this section.
(5) Any order under this section may be revoked or varied by a subsequent order of the Treasury.
(6) The powers conferred by this section to make orders and rules shall be exercisable by statutory instrument."
The noble Lord said: I have for far too long been either an Officer or otherwise in this House not to feel a sense of great diffidence whenever I address it; and my diffidence on this occasion is increased by other circumstances, among them the fact that I am conscious of standing between the Committee and the resumption of the discussion on the Iron and Steel Bill. Another reason is that this matter to which I am drawing attention is a highly technical one, and can be dealt with only in technical language. I therefore fear that I am not likely to arouse or sustain your Lordships' interest. Lastly, I am told that it is of great importance that this Bill should receive the Royal Assent at the earliest moment possible. Every day that passes increases the risk that someone may be deprived of the benefit which he would have received if the Bill had passed. I fear that I can take no responsibility, however, for

621
any delay that occurs if I succeed in in-clueing the Committee to approve and accept my Amendment. It is always open to the Government to insert a clause making the benefits retrospective, say, to the date of Second Reading. If the proposals for the benefits are meritorious, there is no real reason why the Government should not take that course.
I feel hound to move for these reasons, among others. This is an almost age-long controversy and this, though perhaps not the final, is a later stage in that controversy which has continued now for something like a hundred years. This may he our last chance for a long time to bring the matter before Parliament and to cause it to be debated. I have the support of the Law Society, with whose assistance this Amendment was prepared. I have the support of the Bar Council. I have the express support of the Royal Institute of British Architects and, though I am not entitled to vouch for it, I believe I have the support of the British Medical Association. Above all, apart from these supports, I have at heart the interests of the Service which I served for many years and in which I had every opportunity of observing how matters worked.
I must trouble your Lordships with a little technical detail and a little history. The first Superannuation Act was passed, I believe, in 1834. It is actually on the basis of the Act of 1859, passed just ninety years ago, that the present large field of legislation is based. The idea of the Act of 1859 on the whole has been adhered to since, though with many alterations, so that, for instance, a man who entered the Service at whatever age should, by the time he left it, have passed in it a certain number of years in accordance with which his pension should be reckoned, and that that number of years should be such as to give him what is sometimes called a two-thirds' pension on his retirement. Forty years was, and is still, the normal period for the purpose. The ordinary entrant into the administrative grades enters the Service practically as soon as, or very soon after, he comes down from the university. Therefore, the possible or probable retiring age being between sixty and sixty-five, he will complete his forty years and earn his full pension before the end of his service comes.
But the lawyer, the architect and the doctor, if they are to be properly chosen in respect of their possession of legal, architectural and medical qualifications, must necessarily enter later. The Treasury regulations lay down the age of between twenty-six and thirty-five years as being the normal age of entry for that kind of person. If you enter at thirty-five years of age and you are going to be retired at sixty years of age (which, I am sorry to say, is often the case now) you cannot earn a full pension or anything like it. Although people probably did not anticipate that the retiring age would have dropped from sixty-five to sixty, the framers of the Act of 1859 still had regard to that principle. They desired that these extraneous people (if I may call them so) should have the same opportunities as the administrative class of earning full pensions before retiring. Therefore, they inserted a provision enabling the Treasury to grant what we call "added years" to the years which the man had actually served when he left the Service. Of course, it was not intended that the Treasury should act capriciously in respect of particular cases, but that they should make orders in relation to certain classes of men—for instance, the people we now call legal assistants—granting seven, ten, or five years as attaching to the holding of that office, so that the lawyer, architect or doctor should have the same opportunity as the man in the administrative class had of earning a full and proper pension by the time he retired. For some reason which it is difficult to understand, that particular provision was always greatly disliked in certain directing quarters, and, ever since I can remember, the Treasury have always wished to get rid of it.
In 1888 the Ridley Commission recommended that it should go, and they joined with that recommendation this curious recommendation:
"Such a man,"
they said, having described the kind of person I have just mentioned,
"is better remunerated by sufficient salary, which, by an immediate charge, is likely to receive greater attention than a prospective addition to pension."
On that argument, all I can do is to adopt an observation made by the Barlow Committee, to which I shall have to allude in a moment, who said:

623
"The reasons for which it was condemned are nowhere clearly stated and we are not satisfied that we have fully understood them."
I certainly have not fully understood them, and I do not think that anybody else has either, because, in spite of that recommendation and the fact that subsequently "added years" have been taken away, special arrangements have still been made for special classes of people, which comes to much the same thing. By these "added years," numbers of legal officials have their pensions arranged so that, for example, in twenty-five years they can accumulate as much merit as they would have accumulated in forty years under the original plan, and so on.
I do not want to go into more technical detail than I can help. The object of the Amendment, therefore, is as I have just stated, and I do not think its merits require much argument. What I propose to do is to use arguments which have been stated by persons much more capable of judging than I am, and much more capable of putting what they have to say into words, and particularly the two Committees, one presided over by the noble Lord, Lord Chorley, and the other presided over by Sir Alan Barlow. Sir Alan Barlow's Committee, which was the first of the two, was appointed in, I think, 1944, or it reported in 1944—I am not sure which it was—and it had to deal with this particular matter when considering the question of the legal departments generally. I have already quoted one sentence from their Report, but they go on to say:
"One at least of the reasons for the abolition of 'added years' does not hold good to-day, namely, that given by the Ridley Commission in 1888, who expressed the view that cases in which men entered the service after the normal recruiting age were better dealt with by increased remuneration than by increased pension. The cases of officers serving in the departments to which this report applies have not in fact been dealt with by that or any other method, and, in view of the effect of taxation … the method suggested in 1888 would clearly be unsuitable now."
Then they make various recommendations for the improvement of salaries in the department, and they go on to say—
"Our other recommendations cannot be expected to produce the desired results unless substantial improvements are made in the pension conditions applicable to members of
624
the legal civil service either by the re-introduction of a system of 'added years' or otherwise."
When I say "the legal civil service" I hope your Lordships will remember that I am thinking about architects and doctors just as much as about legal people, and the arguments apply to them all. The Committee therefore went on to make certain recommendations, and guarding provisions which I have endeavoured to incorporate in my Amendment. Lastly they recommend:
"the raising of salaries to the scales shown in"—
a particular column which they specify—
"and the provision of adequate pensions for legal civil servants."
I do not like using the names of civil servants in this House or anywhere else, either for praise or for blame, but in this case I am bound to mention the people who formed that Committee so that your Lordships can judge of the authority they had to make recommendations of this kind. That Committee was presided over by Sir Alan Barlow, who was then Second Secretary at the Treasury, and other members were Sir Granville Ram, who is Senior Treasury Counsel, Sir Frank Newsam, who was Deputy Under-Secretary of State at the Home Office and is now Permanent Under-Secretary, and Mr. S. H. Brown, who is a partner in the firm of Linklater and Paines which is probably known to your Lordships as a well-known firm of conveyancers and general solicitors in Lincoln's Inn. That is the first of the two Committees.
The other, one on which I very greatly rely—and I hope Lord Chorley will support me—made very similar proposals. I am sure he will be glad to hear his own words of wisdom. After dealing with this problem they say:
"Another problem is raised by the fact that certain classes of civil servants, that is doctors and lawyers, do not as a rule enter the service until they have had some postgraduate experience in other fields, and thus do not serve for long enough to qualify for maximum pension. Special arrangements have been made in exceptional cases, under Section 2 of the Superannuation Act, 1946,"—
I will come to that later—
"to credit late entrants with 'added years' for superannuation purposes; we think those arrangements ought to be extended more widely."

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That is what my clause is designed to do. Unless you require, as I was going to say, Moses and the Prophets, I do not think I need add anything to what both those Committees have already recommended.
I have not yet heard nor has anybody else, any reasoned argument to the contrary. It is quite true that when this matter was debated in the House of Commons they, or the Committee, were told that they ought to wait and see how things worked under Section 2 of the Superannuation Act, 1946, which does, to some extent, but to a very distant extent, deal with this matter. If your Lordships will look at the Superannuation Act, 1946, of which I am afraid I must read the two relevant subsections, you will see there is very little reference to this particular question. It begins:
"If with respect to any person becoming a civil servant after attaining the age of forty years"—
then something happens. As I have already told your Lordships, the normal entrance age for the people of whom I am talking is 26 to 35, and under that section they can obtain no advantage whatever, nor does it help recruitment in any way.
The Act also says:
"If with respect to any person becoming a civil servant between the ages of thirty-five and forty years the Treasury have directed that he shall be subject to the provisions of the last foregoing subsection, the provisions of the last foregoing subsection shall apply in his case accordingly."
The knowledge that possibly the Treasury may make an order dealing with a person after he reaches the age of 35 again will not help to recruit people between the ages of 26 and 35. I think only five orders of this kind have ever been made and they cannot affect the particular class of person of whom I am thinking. There are other limiting provisions in the Act of 1946, but they are too technical for me to trouble your Lordships with them.
In those circumstances I wish to press the Government very hard indeed to meet me on this matter. When I was discussing it earlier, and before I came here, somebody said to me "What you want to do is to spend more money?" The last thing I want to do is to spend more money, above all on civil servants. But if we are to spend money, it should be spent so that it is likely to produce the
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best possible result. You do not produce the best possible result if you do not offer to entrants coming into the Civil Service such advantages as are likely to attract the best people for the purpose in view. The result may be very serious indeed. Some of these men when in the Civil Service will have to deal with matters of very great importance, socially and financially. The officers in the office of the Treasury Solicitor deal continuously with sums running into millions of pounds. It is very desirable indeed that those men should be of the highest possible quality. Ban these Committees have reported that people, of the highest quality cannot be obtained in present circumstances.
This service in the past has produced very distinguished civil servants. Looking back, I would mention such men as Lord Tring, who was the original Parliamentary Counsel, the late Lord Dysart, who many of us remember was Treasury Solicitor, and among those who fortunately are still alive although no longer in public service is Sir Maurice Gwynne. All these men received "added years" on entrance. They all lived laborious lives. They all made an immense contribution towards the administrative life of this country and to the Government in particular. Such men must be obtained if the work is to be done. I do not want to say anything unpleasant about His Majesty's Government or of anybody, but of late years undoubtedly legislation has greatly increased the number of legal problems as against the conditions fifty years ago, just as it has increased the number of problem; with regard to health, architecture and architectural planning; and, regrettable as it may be, unavoidably it has extended the Civil Service.
The sources from which entrants can be drawn, so far as the Bar and the solicitors' profession are concerned, are very limited, and, of course, there is great temptation to take just anyone who comes along. It is very desirable to find the kind of man who is prepared to work hard and to sacrifice his possible prospect at the Bar or in practice as a solicitor, the kind of man who is usually inspired to leave the Bar or leave the solicitors' profession because he wishes to make some more definite contribution towards the national life than is

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possible if he is carrying on an independent practice and is not engaged in public affairs. These are the people we want to attract. Both Committees have reported that they cannot be attracted in sufficient numbers without some arrangement like this. I earnestly press upon His Majesty's Government that such provision should be made, and I beg to move the Amendment.
Amendment moved—
After Clause 44, insert the said new clause.—(Lord Schuster.)
3.32 p.m.
LORD CROOK: Before speaking on this Amendment may I remind your Lordships of the personal interest which I am under obligation to declare? I am a member of the National Whitley Council, Staff Side, the body which negotiated with His Majesty's Government the Bill which is now before the Committee. May I say how much I appreciate the kindly thought expressed by Lord Schuster in moving this Amendment? May I also congratulate him on the way in which he has put over a very difficult case? My noble friend and I do not find this a new doctrine to discuss because over twenty years ago we were both members of the National Whitley Council. We sat then, as now, facing each other, and we tackled this problem as one which, even then, had been outstanding over a long period of time. There can be no doubt of the validity of the case which has been made by the noble Lord or of the complete justification for a claim for added years. Over a long period, the National Whitley Council, Staff Side, have agitated for this and many other desirable reforms of the Superannuation Acts, and, in the result, have secured from Parliament a succession of amending Acts—the Acts of 1935 and 1946 being notable Acts which have improved Civil Service superannuation.
The Bill now before the Committee, and on which I had the privilege of addressing your Lordships when it was read a second time, is one which carries out the largest-scale improvements of Civil Service superannuation ever undertaken. In negotiations on this kind of thing, as one would expect, we did not always come out with everything that we had hoped to obtain. In the course of those negotiations we failed to secure for the Civil Service three important items.
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Added years, to which the noble Lord has referred in moving his Amendment were one, an additional amount of money for the gratuities of temporary staffs dismissed from the Civil Service was another, and more important than both of those together was the third—the counting of unestablished service for superannuation purposes. It was agreed that those who signed the agreement having failed to obtain those three items were at liberty to make use of their constitutional and democratic right to approach Members of both Houses of Parliament to try to secure alterations in the Bill during its passage through Parliament. As a result, in Standing Committee B of the other place there was a defeat of the Government on the major issue I have mentioned—that of counting unestablished service for superannuation purposes.
When the Bill came before the other House on Report, the Chancellor of the Exchequer resisted the change, and the decision of Standing Committee B was reversed. The Bill, therefore, went back into its original form, with none of the three additional items which I have mentioned embodied in it. That, naturally, was something which those of us who had been taking part in the agitation regretted. We realised, however, that we still had an agreement to which we were parties and that we had a magnificent Bill, though there are many more things which we shall ask the Government to introduce in due course, including the three items that I have mentioned. When the Bill came to this Chamber, I had to look at my own humble position, and to consider whether I would table an Amendment which I was not debarred from tabling by any undertaking to the Treasury. I also looked with great interest to see whether any other noble Lords, particularly from the Benches opposite, would move Amendments. But what we were conscious of was that anything which we did at any stage of the Bill's progress in this House—if I may say so candidly—would be nothing more than a gesture.
If we "propaganded" here by moving Amendments, and if we were fortunate enough to secure for them the approval of your Lordships, thereby bringing about defeat of the Government, those Amendments would have gone back to the other

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place. We should have had the same battle all over again, and eventually the result would have been the same. We had no reason to expect that the Chancellor of the Exchequer, who had resisted the large cost of counting unestablished service for superannuation purposes, would give way on the second occasion. If this Amendment is carried now, much as l like it in principle and pleased as I should be to see it enacted, the truth is that, from the Civil Service point of view, the whole balance of events will be upset. Those who have been handling these discussions in the formative stage during the last eighteen months would be bound, if this Amendment were sent to the Commons, to want to suggest on the Report Stage these other Amendments that I have indicated, which are all important. We should have a battle on those and, eventually, there would probably be rejection of all of them in the other place on the grounds of their cost. To carry an Amendment of this kind and not to carry one embodying the major reform which we are seeking—that of counting unestablished service, a question which is causing great agitation in the Civil Service—would, in the opinion of many of us, be most unwise.
If we carried this very desirable Amendment all we should do would be to cause unnecessary delay in the passage of the Bill, which is something which we are anxious to avoid. It is no mere figure of speech to say that every day worthy men in His Majesty's Civil Service pass on without the benefits of the widows' pension and other benefits contained in this measure. May I remind the noble Lord, Lord Schuster, that there are one or two dear colleagues, in the Treasury and elsewhere, and known to both of us, who have passed on in recent weeks without recieving the benefits which will be conferred by this measure. Therefore, I have reached this conclusion. Though this Amendment is one which I should dearly like to see inserted in the Bill, though it does something which I shall hope to see both Houses of Parliament adopt and pass into law before I pass on, I think it is right now to urge my noble friend, having ventilated this matter so fully, to withdraw the Amendment so that the passage of the Bill may not be delayed.
3.40 p.m.
LORD ROCHE: I desire to say just a few words in support of the Amendment which has been moved by my noble friend Lord Schuster. I venture to do so despite the persuasive advice which has been given to him by the noble Lord who has just sat down. I think I can put in the briefest aril simplest fashion the point which I want to make. If your Lordships will look at the Amendment you will see that it relates to a class of persons who al e professional and who have specialised qualifications which can be secured only outside the Civil Service and before they enter it. It is therefore only natural that they should enter the Service late. The class of such persons whom I know best are lawyers, but of coarse all those concerned are not exclusively lawyers. To the question: "Is there a class of persons whom it is desirable to have in the Civil Service with special qualifications secured outside?" the answer I give, with some emphasis, is, "Yes."
For some years—from 1914 to 1917— on the invitation of that very eminent and able civil servant, Sir Eyre Crowe, I advised the department which he set up on legal matters and spent some hours most days between 1914 and 1915 in contact with the Civil Service. The impression I derived then was that a lawyer in a department like that was absolutely, useless unless he had obtained his qualifications beforehand in practice and in experience of life. That is the only class to whom this provision applies. I am satisfied that to obtain such persons at the proper age and with proper qualifications we must have a provision like this. I have never heard of any other satisfactory way of doing it. I think it would be an economy and not an expenditure to pass this. With regard to the plea of the noble Lord who has just sat down, it really amounts to this: that because he cannot have the whole loaf, he will not give my noble friend this little bit of bread. I do not think your Lordships should assent to that proposition. It is an egalitarian doctrine, no doubt, but the conditions are different and the qualifications are different, and I think the House should provide for people with qualifications such as are the subject matter of this clause.
LORD WRIGHT: I do not want to prolong this discussion at this stage and

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at this time. It is unfortunate that it cannot be ventilated more fully because it is a very important matter. It would be an act of elementary justice to a very important body of people who enter the Civil Service later in life and who bring to it special qualifications which they have learned in their experience outside. I feel the House is indebted to the noble Lord, Lord Schuster, for raising this question, and I wish to express my complete sympathy with all that has been said in favour of some alteration, if it can be secured.
THE MARQUESS OF SALISBURY: I do not intend to intervene at any length in this matter, on which I am afraid I am not qualified to express a view, but I feel sure that the Government will realise that the noble Lord, Lord Schuster, speaks on this subject with a very special authority, derived from a lifelong experience of it. I am sure that they, like us, have been impressed by the deep conviction with which he spoke. I imagine that it is not the intention of the noble Lord to press his Amendment to a Division for, as he knows, this is a question on which varying views are held in all Parties, but I hope that the noble Lord, Lord Pakenham, when he comes to reply for the Government, even if he is not in a position to make any commitment for them—as I imagine may well be the case—will at any rate be able to assure the noble Lord that the Government will give further serious consideration to this matter in the light of what he said.
LORD PAKENHAM: The noble Lord, Lord Schuster, began by saying that he was diffident about his capacity to address the Committee and hold its attention. I feel that if the noble Lord, with his remarkable grasp of fact and language, is to feel diffident, some of the rest of us should possibly quake at the knees. I hope that the noble Lord will never feel that he will not hold the attention of all members of the House capable of following a rational argument delivered by a great authority—and that means literally the whole House. I followed him not only with great care but with great interest. Of course, I will assent to the suggestion of the noble Marquess that I should ask the Government to look further into this matter, but it would be wrong for me to suggest that there is
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much, or indeed any, likelihood, so far as I know, of change of view. I say that, not because the noble Lord did not put his case with great force, but because this has been very carefully considered by the Government already. I cannot do more than say I will lay the noble Lord's remarks before my right honourable friend, but I am afraid I must not raise his hopes to any degree.
I think the noble Lord was again perhaps too modest in saying that he did not feel the merits of the case needed argument. I think they do need argument, from both sides, and it seems to me that he put the arguments of one side very clearly. He was answered, from a slightly different angle from the one which preoccupies me, by the noble Lord, Lord Crook, who made a very effective contribution from that angle. But perhaps I may state the reasons why the Government have not been able to adopt the suggestion of the noble Lord after all this consideration going back some years—indeed, in the view of the noble Lord, going back over a hundred years. As the noble Lord has explained, broadly speaking the object of the proposed new clause is to allow professional civil servants to count for pension the years during which they were acquiring their professional qualifications. Take the simple case of a solicitor who joins the Civil Service, shall we say, at the age of twenty-seven, after four years of experience as a solicitor. Under the noble Lord's proposition, he would count for pension the four years prior to his entering the Service. That is the point, put very briefly. It is intelligibly argued by the noble Lord that it is impossible for some of these civil servants who come in later to serve sufficiently long for a maximum pension unless they count their years of training. That is the case which the noble Lord stated and which was reinforced by a strong legal authority behind him.
This is not one of these cases where one sweeps aside the point and says there is nothing in it. I can appreciate the force of the argument, but one has to balance it against a great many other arguments. The noble Lord said that the last thing he wanted to do is to spend more money on the Civil Service. It is not the last thing I want to do; it is one of the first; but it is the last thing

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I am afraid I am able to do this afternoon. In that sense we come together. There is a strong case for doing still more, if we had the money, for all branches of the Government service, including the very important people whom the noble Lord has specially in mind.
Let me set out the arguments against this proposition, apart from the broad economic position of the country. Pension, like pay, is part of the remuneration for the work, and we see no reason why civil servants of this kind, in the normal course of events, should receive a pension for forty years' service if less than forty years have been served. Whatever people say about training for service, it cannot be regarded as the same as service, and we would be conferring a special advantage on these people if we treated training for service in that Way. Statistics on this matter are not easy to come by, but I would mention that the classes the noble Lord has in mind tend to get higher pay not only during their career but also at the time of their retirement, and it is at that time that pay is taken for calculation of pension. On the whole they tend to be rather higher paid than the average. Thirdly, in so far as special pension provisions are needed for late entrants, the Government view is that the existing powers given by Section 2 of the Superannuation Act, 1946, which deals with late entrants, are adequate. This Act, to which the noble Lord alluded, authorises the Treasury in the case of any individual—I stress the word "individual"; I am not now talking of an actual class—who enters the Service after the age of 35, to pension him, not on his actual service, but on his actual service multiplied by a maximum factor of eight-fifths, which I take it would be more generous in the case of such individuals than what the noble Lord has in mind. The object is to supply an incentive to a few professional men of high attainments, whose acquisition to the Civil Service is essential to the efficiency of a limited number of departments. I must make it plain that the Government do not feel that that Act could be, or should be, applied to whole categories; indeed, it could not be on a ratio of eight-fifths.
It is difficult to argue—though I do not want to lay too much stress on this —that the marginal difference in these cases between the pensions secured under
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the noble Lord's plan and the pensions provided by the Government would make the difference in late life between hardship and a reasonable standard, since in the majority of cases the new clause would tend merely to increase very slightly what are already adequate pensions. Finally, I would mention a small point—I agree that this could be corrected—which is that the clause as drafted by the noble Lord is technically defective, since it is based on the assumption that there is a normal age of recruitment to the Civil Service. As the noble Lord knows, there is no normal age for recruitment.
LORD SCHUSTER: I do not accept that. I do not think any court would have difficulty in determining in a particular use what the normal age of recruitment is. Everybody knows what the normal age is.
LORD PAKENHAM": I am sorry to have introduced the paint, if the noble Lord questions it.
LORD SCHUSTER: I think that is playing with words. Everybody knows at what age people enter the administrative class. The ages are actually fixed by regulation. What the difficulty is in determining the normal age, I cannot imagine.
LORD PAKENHAM: Recruitment varies from 16 to 24 years. I am advised that this alone makes the clause as drafted by the noble Lord unworkable.
LORD SCHUSTER: I am quite prepared to alter the drafting of the clause in any way that is agreeable to the noble Lord. I am trying only to assert a principle. I endeavoured to put in as many guarding provisions as I could find for the sake of the Civil Service and the Commissioners. I am not in the least attached to the drafting of the clause. I am not much of a draftsman, and it is very difficult to draft a clause accurately.
LORD PAKENHAM: I mentioned that as an additional point. It is the fifth objection, and I am ready to leave that out of the discussion. I thought it necessary to put on record that the clause as drafted by the noble Lord is unworkable. No one likes turning down any proposal which is commended with so much sweetness and authority as this has been by the noble Lord and his colleagues. No one likes doing anything at all which

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might seem in any way chilling to this most reputable clause in relation to entrants into the Civil Service. But the noble Lord, Lord Crook, has explained that, in the view of the Civil Service as a whole, there are other claims more pressing than these, and I have given three important reasons, at any rate, why the Government cannot accept the Amendment. I will certainly ask my colleagues to reconsider the matter but, as I said at the beginning, I am afraid I really cannot hold out any hope.
LORD SCHUSTER: In courtesy to the noble Lord, and possibly in justice to myself, perhaps the Committee will bear with me if I reply. Running through the speech of the noble Lord there was this kind of thread: that we are trying to confer some benefit on some particular persons or class of persons. That is not the object of this clause. The object of this clause is to try to ensure that those persons who are recruited at the beginning, and enter with professional qualifications, are the best who can be found for the purpose. Of course, we cannot hope to recruit persons of such legal eminence—I will not mention any names—as some of those who sometimes sit on these Benches and on the Benches behind me. But we do hope, by holding out reasonable prospects, that we shall recruit the best people. Having recruited them, what we want is that they should be able to do their work in the way in which it is described in one of these Reports, where it says that the civil servant when he is doing his work ought not to be worrying himself about details of wretched, trivial finance, as to what will happen to him next and whether he is going to be ruined and have nothing to live upon. We are not trying to confer benefits upon people, but on the Service. It is for the sake of the Service, and that only, that we make these proposals. I entirely adopt what I think my noble friend Lord Roche said, that, in fact, improvements in the conditions of the recruitment of the legal Civil Service are likely to be highly remunerative to the State itself.
I would like to mention one further point which I think arises from the noble Lord's reply. If it does not, I hope he will pardon me. I attach great importance to the recruit being in the rather later than the earlier ages of the period
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of from 26 to 35 years. I do not believe we want a lawyer who is merely a man who has passed a good examination. What we want is the man who has come to know the law as an active, living thing, operating on men's minds, on their bodies and on their fortunes. That is equally true of a solicitor or a barrister. Therefore, if I were sitting on a Board—and I have sat on many of this kind—I would tend to select the older rather than the younger man, because I would prefer a man with knowledge gained from the world rather than the man with knowledge gained from books. I say that only because it adds to the point which I made, that we are trying to get the best men and are not hoping to give men we already have further advantages.
Meanwhile I am grateful to the noble Lord for his courtesy, for his kind observations about myself and for his patience and forbearance in listening to me. If I have the matter put to me as it has been put by the noble Marquess, Lord Salisbury, I have no choice I cannot go on. In the circumstances, I would ask the leave of the Committee to withdraw this particular Amendment. I would, however, like to press on the noble Lord, Lord Pakenham, how greatly we desire that the matter should be investigated. If I may venture to say so to my noble friend Lord Crook (we have been "enemies" for so many years, he will, I am sure, not mind my calling him that), I really cannot see why, because some great reform such as he desires cannot be carried out, this comparatively small reform, which is within an easy compass, can be implemented without great financial cost, and which speaks for itself on merits, cannot be carried out. Having said that, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clauses 45 to 52 agreed to.
LORD PAKENHAM LORD PAKENHAM moved, after Clause 52, to insert the following new clause:
Application to employees of Cable and Wireless, etc.
"…Section six of the Commonwealth Telegraphs Act. 1949 (which enables the Postmaster General to make regulations with respect to the pension rights of employees of Cable and Wireless Limited who enter the civil service of the State) shall have effect

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as if the references in paragraph (d) of subsection (2) of that section to the Superannuation Acts, 1834 to 1946, included references to this Act."
The noble Lord said: This new clause is required to extend the benefits of the Bill, in addition to those of the earlier Superannuation Acts, to the staff due to be transferred to the Civil Service when the Post Office take over Cable and Wireless. I beg to move.
Amendment moved—
After Clause 52 insert the said new clause. —(Lord Pakenham.)
On Question, Amendment agreed to.
Remaining clauses and Schedules agreed to.
House resumed.

HOUSE OF COMMONS (REDISTRIBUTION OF SEATS) BILL [H.L.]
Read 3a (according to Order), and passed, and sent to the Commons.

IRON AND STEEL BILL
4.0 p.m.
House again in Committee (according to Order).
[The EARL OF DROGHEDA in the Chair]
Clause 15:
Compensation to holders of securities.
(9) For the purposes of this section, the value of any securities not being securities to which subsection (2), (3), (4), (5) or (6) of this section applies, shall be such value as may be agreed between the Minister and the said stockholders' representative or, in default of such agreement, as may be determined by arbitration under this Act, to be the value that the securities would have had under the preceding provisions of this section if they had been quoted in the Stock Exchange Official Daily List on all the dates mentioned in subsection (2) of this section or, in the case of securities of a class issued on or after the earliest of the said dates, on such of those dates as occurred after the date of issue, and the arbitration tribunal, in determining the value that the securities would have had as aforesaid, shall have regard to all relevant factors including, as far as may be, the value of securities to which subsection (2) or subsection (3) of this section applies (as determined under that subsection), being securities which, as regards all matters affecting their value, are most nearly comparable to the first named securities:
VISCOUNT BRIDGEMAN VISCOUNT BRIDGEMAN moved to omit subsection (8). The noble Viscount
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said: In the temporary absence of my noble friend Lord Rennell, I think I am right in saying that this first Amendment on the Order Paper is to be regarded as consequential on the Amendment taken last night.
LORD LUCAS OF CHILWORTH: Accepted on the understanding that it is only consequential.
VISCOUNT BRIDGEMAN: Yes. I beg to move.
Amendment moved—
Page 17, line 37, leave out subsection (8). —(Viscount Bridgeman.)
LORD RENNELL: This is one of the consequential Amendments which the Leader of the House discussed yesterday.
On Question, Amendment agreed to.
VISCOUNT BRIDGEMAN VISCOUNT BRIDGEMAN moved, in subsection (9) to omit "as far as may be" and insert "where applicable." The noble Viscount said: This next Amendment deals with a slightly different aspect of this problem; that is to say, of the non-quoted companies. The Committee will remember that yesterday we were dealing entirely with the question of the quoted companies. In this subsection we come to the provisions for the non-quoted companies, which are to be valued on an agreed value between the Minister and the stockholders' representative, where regard has to be had, "as far as may be," to the value of comparable Stock Exchange securities.
We spent a good deal of time last night explaining how difficult it is to use Stock Exchange values as a measure of value of the quoted securities. How much more difficult is it, then, to use it as a measure of value of the unquoted securities? In order to do this, under the previous nationalisation Acts, where there are certain comparable provisions, assumptions of every kind were necessary—and will be necessary here. You have to make an assumption of when the stock was issued; what were the conditions prevailing at the time; what was the attitude of the market, including the stags, and so forth. All the time you had to bear in mind that there were probably good reasons why these stocks should not have been introduced in the market at all. I say that, because I feel that it will be extremely difficult to claim that every case where a non-quoted

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security is being valued has any counterpart in any quoted security.
To go further, there are thirteen companies where there is no comparison whatever. The Committee will recollect that altogether there are ninety-six companies in the Third Schedule, of which twenty-six are quoted and seventy are not. Some of those are subsidiaries, and that leaves a figure of about fifty-five companies which will have to be valued under this subsection. Now of those fifty-five companies, thirteen do nothing but produce iron ore—they have no other business. Curiously enough, it so happens that there is no company which is quoted on the Stock Exchange which has, as its sole business, the production of iron ore. I am submitting to the Committee that there are cases where there is no analogy at all between any Stock Exchange value and the value of these non-quoted companies. That is the reason why I am moving the Amendment which stands in my name and in the names of my noble friends. It is coupled with the next Amendment on the Marshalled List which is to leave out the words "most nearly." Those two Amendments go together, and what I have been saying applies to both of them. I think this is a reasonable Amendment. It brings this clause into line with what I think are the actualities of the case. I beg to move.
Amendment moved—
Page 18, line 9, leave out ("as far as may be") and insert ("where applicable").—(Viscount Bridgeman.)
LORD LUCAS OF CHILWORTH: The answer to the noble Viscount is that the case will go to the arbitration tribunal only if the stockholders' representative and the Minister cannot agree. We say that if the noble Viscount's Amendments are accepted the arbitration tribunal's discretion and powers, and their whole operation, will be handicapped. If it is true, as the noble Viscount says, that there are shares where there is nothing comparable, then the arbitration tribunal will not be able to take that into consideration. But why let them disregard, or require them to disregard, something that is "most nearly" comparable? I suggest that in practicalities this Amendment is unnecessary, because experience suggests that the Minister and the stock-
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holders' representative have never yet fallen out—a fact which shows once again that the stockholders' representative is only too glad to take the Minister's offer. So far as electricity and the other nationalised industries, where there is an arbitration tribunal, are concerned, there is not one case where this matter has had to go to the arbitration tribunal. With that explanation, I hope the noble Viscount will see fit not to press his Amendment.
VISCOUNT BRIDGEMAN: I feel to a certain extent reassured, if not convinced, by what the noble Lord has said. I do not think this will handicap the tribunal because my Amendments substitute the words "where applicable" for "most nearly." Therefore, they would not preclude the tribunal from taking into account Stock Exchange values in cases where they thought it right to do so. But I am reassured when I hear that they will not be asked to stretch the analogy beyond a reasonable point. I think we can leave it at that. I am glad to have had the noble Lord's assurance, and in withdrawing this Amendment, may I say that I shall not be moving the Amendment which immediately follows?
Amendment, by leave, withdrawn.
LORD RENNELL: This Amendment is consequential on the Amendment which was moved last night to Clause 15. I beg to move.
Amendment moved—
Page 18, line 26, at end insert:
("( ) If any question arises under any of the foregoing provisions of this section as to the value of any securities it shall be settled by agreement betweeen the Minister and the stockholders' representative or in default of such agreement, by arbitration under this Act:
Provided that in the case of any additions or deductions to be made to or from the Stock Exchange values of two or more classes of securities of a company the total amount of the additions or deductions shall be settled as aforesaid and the proportions in which the total amount is to be allocated to the different classes of securities shall be settled by a scheme assented to by such majority as is specified in subsection (2) of section two hundred and six of the Companies Act, 1948, of the holders of each class of securities concerned or in default of such assent determined by arbitration under this Act.")—(Lord Rennell.)
LORD LUCAS OF CHILWORTH: This Amendment is only consequential and we in no way accept it.
On Question, Amendment agreed to.
Clause 15, as amended, agreed to.
Clauses 16 and 17 agreed to.
Clause 18:
Control of dividends, interest and other payments
(2) The payments of interest or dividend permitted under this section are as follows:
(b) in the case of securities forming part of the share capital of the company—
(i) if the securities fall in the class, or in one of the classes, which ranks or rank lowest in order of priority for payment of dividend (in this section referred to as "ordinary shares"), payments of dividend at the rate of four per cent. per annum or the rate calculated as an annual rate, paid on that class of securities in respect of the last financial year in respect of which a final dividend was paid before the twenty-ninth day of October, nineteen hundred and forty-eight, whichever is the higher;
VISCOUNT BUCKMASTER VISCOUNT BUCKMASTER moved, in subsection (2) (b) (i), after "rate" (where that word occurs a third time) to insert:
"which would absorb the same proportion of the net revenue of the company (as certified by the auditors or one of the auditors of the company) for the period in respect of which the payments of dividend are made as the dividends."
The noble Viscount said: Before touching on the two Amendments standing in my name I would like, if I may, to say something about one or two remarks which fell from the noble Lord, Lord Lucas, last night. I am somewhat handicapped because I have not had an opportunity of seeing Hansard which published the end of last night's debate, though I think my noble friend excluded me from the references he made concerning other noble Lords who spoke. Still, speaking purely for myself, I wish to make it quite clear, that if I attempt to the best of my ability to press a case home with such force as I may possess it in no way impugns the political integrity of the noble Lord, Lord Lucas, which has never for one moment been questioned by me. The noble Lord will appreciate that Ministers in responsible positions are not altogether guarded in their remarks about noble Lords who sit on this side of the House and we might not be expected to observe too nice a standard of behaviour if we fell into the category to which we have been relegated. Be that as it may, I am sure the noble Lord is now quite happy on the point, and I am sure he
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understands that I did not impugn his political integrity in any way at all.
I would like to thank my noble friend Lord Swinton, who is not here at the moment, for saying that those who supported the Amendment were not voicing the view merely of one half of one per cent. of the population. I was not voicing the views of any section of the community, and the noble Lord, Lord Lucas, knows that if I had a personal interest in this matter I would have freely declared to it; I have in fact no iron or steel shares, and do not think I have ever owned any; I am not in the City or now a member of the Stock Exchange. Indeed, I am doubtful whether many can be more divorced from iron and steel than I am. I would like however to remind the noble Lord, Lord Lucas, that there are over 100,000 small shareholders in these great steel companies, and all that I and other noble Lords who spoke were seeking to do was to secure that what we believed to be right should be done. If we pressed the case home it was because once or twice Lord Lucas has shown signs of seeing what we on these Benches believe to be the light, and our purpose in pressing home the case was to drive away and dispel what we feel are the mists which cloud his judgment in this matter. Having left him, I feel sure, completely happy, and asking your Lordships forgiveness for my digression, I will now apply myself to the Amendment.
I think it will be convenient to your Lordships if I were considered to be addressing myself to the two Amendments at the same time. The Amendment relates to a clause the purpose of which is to prevent the distribution of assets by an excessive or improper increase of dividend. That is a purpose in which I am entirely in accord with noble Lords opposite. It would be quite wrong, once the principle of nationalisation has been accepted, that it should be possible to empty the till in order to defraud the Government. But, having said that, I would say at once that this Amendment has no such purpose and contemplates no such thing. This Amendment is designed to give relief to those companies which have, over a period of years, embarked on very large sums of capital expenditure, expenditure which is now beginning to fructify and the fruits

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of which are altogether denied to the unfortunate shareholders. This great industry, as the noble Earl, Earl Dudley has said, has not been afraid to spend, in a very large way indeed, sums running into hundreds of millions. In my submission it is altogether wrong that shareholders should be denied any possibility of any return from this expenditure, which was obviously undertaken not only in their interest but in the interests of the nation as a whole. As is perfectly plain, owing to the operation of dividend limitation they must be denied any such participation. Since the year 1946–47, to which I think dividend limitation relates and to which therefore the restriction in this clause relates, the output of steel has increased by 3,750,000 tons, owing to the great expenditure which was undertaken by the companies concerned.
Now dividend limitation was introduced as a voluntary measure, to exist for one year, and that period was subsequently extended for a further year. Under this Bill, with a vesting date which may not have effect until August, 1951, you get a very substantial extension of a period of voluntary limitation which was supposed to come to an end in twelve months time. I feel sure that, whichever noble Lord replies to this Amendment, he will give due weight to that particular point. There is in this particular case a long and somewhat indefinite extension of a purely voluntary principle which should have terminated approximately twelve months from the present date. I would further put to noble Lords opposite this point: that, in the words of the Chancellor of the Exchequer himself, the money which might have been distributed in dividend, but which has in fact been ploughed back into the assets of the companies, should increase the value of the shares. It seems that that can be only because, in the final resort, the shareholders expect to participate in it. If the Chancellor's argument was sound—and I do not accept that it was—it can have been only because in the end the shareholders hoped and expected to receive something; but in this case they can receive nothing for the greatly increased assets, because the State takes them over. Out of the very words of the Chancellor of the Exchequer himself I
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hope that I have proved the hardships of the circumstances of this particular case.
This Amendment does not propose, and certainly I would not support, any reckless or extravagant increase of dividend. All this Amendment proposes is that if, as result of this great expenditure which has been undertaken, the net revenue of a company should increase, the company should be permitted to pay dividends of the same relative percentage. To put it into somewhat simpler form, if the net revenue of a company were £100,000 and it paid out £4,000, then if net revenue were £200,000 it would be entitled to pay out £8,000—and no more. I hope that I have made that clear to the noble Lord—the wording of the Amendment is necessarily rather involved. It cannot in justice be argued, I submit, that such a proposal is inflationary. The steel industry, quite rightly, pays very high rates of wages: roughly £10 in money is paid out for wages and pensions for every £1 of dividend. I feel that the modest increase of dividend permitted by this Amendment only in certain circumstances is a just and proper reward for expenditure which has been entered into. It is surely not an unreasonable or wrong thing to ask in the circumstances which I have tried to put before your Lordships, with a moderation and restraint which I hope may appeal to the noble Lord. I beg formally to move the first Amendment standing in my name.
Amendment moved—
Page 2, line 28, after the second ("rate") insert the said words.—(Viscount Buckmaster.)
LORD RENNELL: I should like to support this Amendment. I am sure the noble Lord, Lord Lucas, and other noble Lords opposite would agree that there is an element of unfairness unless some such provision is made. I entirely agree that there ought not to be any question of companies dissipating their dividends after an announcement has been made of the nationalisation of the industry. We are all agreed on that. But in the case of steel companies and notably the larger companies, there is another aspect. It will be known to noble Lords that at the urgent request of the Government a great deal of capital has been raised for the production and the increased output of iron and steel, and, above all, to modernise plant. In the heavy industry the period during which capital takes to

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fructify must inevitably be a very long period—years and not months. It is a matter of fact that a great part of the capital raised for these purposes in 1945 and since is now about to fructify, and the profits from that invested money will be reflected in the balance sheets of certain companies this year and a great many next year. The limitations and restrictions which this clause, as drafted, applies mean that there are many shareholders who are not going to benefit by the capital they have invested, the value of which will not be reflected in the price of the shares at the time of the takeover.
There is a further fact. Not only will they not derive benefit from the money which has been invested but they have indeed had the burden of carrying that money. They are having to pay interest, either preference interest or dividend on ordinary shares, so that they have the double disability of being deprived of the profits of the concern in which they have invested their money and of having the additional burden of carrying that capital whilst it was unproductive.
There is yet another point. A great number of these companies have as yet not settled with the Inland Revenue about their tax claims and counter-claims in connection with excess profits duty and similar debts arising out of operations during the war. Some companies are still receiving refunds of tax overpaid which, in the normal course of events, if paid out of revenue, could be used for increasing the distribution of dividends. It does not seem fair that because the Inland Revenue have in the first instance taken more tax than they were entitled to, and have then spent some time making up their minds about how much to give back, the benefits should inure to the Government and not to the shareholders. I cannot see how it is possible in equity to maintain a position by which the shareholders are going to be deprived of this benefit. This Amendment or an Amendment of similar purport should be accepted—always safeguarding the principle that there will be no dissipation of assets. That can be achieved by ensuring that the proportion of the money paid out by way of dividends shall not be greater than it has been hitherto, as was explained by the noble Viscount, Lord Buckmaster. I cannot see how in fairness and equity a case can be made
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against this contention, and I hope, therefore, that the noble Lord will accept this Amendment or something like it and thus prevent what believe would be a very serious injustice.
LORD PAKENHAM: The noble Viscount, Lord Buckmaster, expressed the hope that he had spoken with moderation and restraint. I can assure him that I think he displayed both those qualities, as did the noble Lord, Lord Rennell. Perhaps I may be allowed to say, on behalf of the noble Lord, Lord Lucas, and myself, that we much appreciate the earlier part of the noble Viscount's remarks, and Lord Lucas has asked me to say that it was never in his mind to suggest that Lord Buckmaster had any selfish interests in this business or that the noble Viscount, for his part, used improper language in any way.
VISCOUNT BUCKMASTER: I felt sure it was so. Thank you very much.
LORD PAKENHAM: I now come to the Amendment. I do not honestly think it will come as a great shock when I say that the Government regret that they cannot accept this Amendment or an Amendment on these lines. In another place an Amendment was moved which was not quite the same as this but had very much the same effect. It was to the effect that where the net revenue of a Third Schedule company was higher than its net revenue in the last financial year before October 29, 1948, the dividend payment should be increased proportionately. In this case, if the revenue were higher the dividend could go up, and if lower the dividend could go down; it is a movement each way, and the noble Viscount may say that this is not a move only to increase dividends. But there is really little doubt that if this Amendment, or anything like it, were carried, it would mean in fact a considerable increase of dividends. I am ready to go into this matter at whatever length is required, but such a proposal cuts right across the financial policy of the country with regard to dividends.
It will have been observed by the Committee that in recent nationalisation measures the policy of restricting dividends has been similar to the one adopted in this Bill. Similar provisions were included in the Gas and Electricity Acts. In short, in regard to this provision, or

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something very close to it, I suggest that here is perhaps an opportunity where discussion might produce agreement. But I am bound to point out to the Committee that any Amendment of this kind would in some measure defeat the purpose of the Government to continue the policy of dividend limitation. While the noble Viscount did not put his view quite clearly, he implied that, if the Government were reasonable, they would perhaps take off this dividend limitation fairly soon. I myself have no authority to predict anything about the future financial policy of the Government.
VISCOUNT BUCKMASTER: I did not mean to imply that if the Government were reasonable they would take it off. I was not expressing any view in that regard. What I meant was that they have asked for dividend limitation to be worked as a voluntary measure for a period of one year. That voluntary measure has now been extended for a second period of one year. Under this Bill, the vesting date of steel companies is August, 1951, which would be a great extension on that voluntary period which expires at approximately twelve months from the present dale.
LORD PAKENHAM: I appreciate that point but, as the world is to-day, I have no power whatever to hold out any hope of an alteration in the policy of dividend limitation. I think I am right in saying that that policy carries with it the support of all responsible people in the country and all members of your Lordships' House. I pay my tribute—though perhaps it is not necessary to do so because it has been paid by more authoritative persons than myself, including the Chancellor of the Exchequer on a number of occasions—to those who have had the power and have used it in the way in which the Government have asked them to use it, acting most patriotically in the policy of dividend limitation. I do not think there would be very much use in my promoting a prolonged discussion on this Amendment when agreement is not possible. I can only ask the noble Viscount in relation to this Amendment—and I say this quite solemnly—to exhibit the same attitude that he and others have exhibited in relation to dividend limitation. I ask him to withdraw the Amendment in the spirit
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in which industrialists and financiers have acted in limiting their dividends. I beg the noble Viscount to withdraw his Amendment.
LORD RENNELL: May I ask one question? I do not want to be personally unfair, but from what the noble Lord has said, I draw a conclusion which is not one with which we agree.
LORD PAKENHAM: I hope that the noble Lord will not be unfair at all, personally or otherwise.
LORD RENNELL: A consequence is this. Let us take the case of a windfall return, of tax overpaid. Does the noble Lord think that it is fair and right that those overpaid moneys to the Inland Revenue, refunded in the near future, should inure to the benefit of the Government and not to the benefit of the shareholders? Secondly, does the noble Lord think it fair that the shareholder who has put up money for the carrying on of the business ought not—this is the conclusion—to be allowed to receive any benefit from that capital when the profits come in?
LORD PAKENHAM: The noble Lord has swung on me, as he is apt to do with that genial smile behind which lurks so crafty an intelligence, one or two points which occur more readily in the practice of his profession than in mine. I understand that a similar point was put to the Financial Secretary in another place, No doubt the noble Lord is perfectly aware of his answer.
LORD RENNELL: No, I am not.
LORD PAKENHAM: I am amazed that the noble Lord, who is so interested in this question, did not even bother to look at it. I should have thought that would be an elementary practice.
VISCOUNT SWINTON: No doubt the noble Lord thought he would get a wiser reply from the noble Lord opposite.
LORD RENNELL: My answer to the noble Lord is that so much is said in another place that I have not time to read it all.
LORD PAKENHAM: I appreciate those compliments from the noble Lord, who did not put it in quite so genial a way but meant very much the same thing. However, the noble Lord who puts to me

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this teaser is not himself informed on the subject. Speaking without proper opportunities of preparation, I would say that the same case was put to the Financial Secretary, and he said:
"I cannot imagine that the case the right honourable gentleman gives is likely to arise. I have told him that, if it does and if there is a particularly blatant case where an obvious injustice would be done unless something of the kind were permitted, it would be possible under the clause for my right honourable friend to look at it. I hope that the Committee will not assume that I am promising that a case of this kind will be looked at favourably; if such refunds are made they obviously become assets of the company as a company and not of the individual shareholders as such."
That is the answer given. History does not relate precisely what followed in the discussion but, if the noble Lord feels dissatisfied, he can return to the attack at the next stage. That was the answer given on what I believe to be the same point that has been raised by the noble Lord. I thank the Committee for the genial way in which they have received my unpalatable remarks and once again beg the noble Viscount to withdraw his Amendment.
VISCOUNT BRIDGEMAN: We have not quite finished receiving the noble Lord's unpalatable remarks, and I would like to say a few words in summing up before my noble friend has the opportunity of considering the noble Lord's request. First, I was rather astonished to hear a proposition that fell from the noble Lord, if I understood aright, that there can be any difference between the ownership of assets by a company and the ownership that the shareholders have in those assets. Surely, the net assets of the company cannot belong to anybody but the proprietors of the company. May I go on to some of these other points? What the noble Lord said really was that, because the Chancellor of the Exchequer has asked industry as a whole not to increase their dividends for the forthcoming year, that is a reason why the Government should seek to make a law preventing one particular industry from increasing its dividends at all. However long the gap may be between the passing of this Bill and the vesting date, dividends are not to be increased at all. Therefore, no account is to be taken—and this is the point I want to get on the record—of the circumstances of the steel
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industry. Industry as a whole—and the noble Lord himself paid tribute to it—was called upon to accept a policy. Some companies accepted an absolute policy of no increase in dividends, while most companies adopted a policy of moderation and restraint.
We claim that the words of the Amendment are entirely in line with the policy of moderation and restraint, and that in the steel industry you cannot act as you did in the case of the gas and electricity industries and say it is fair that the dividend should remain unchanged. Over and over again in this debate, we on this side have attempted to point out that the steel industry has certain features which distinguish it sharply from other industries which follow a more even course. One point which has been mentioned so often that I will not go into the details again is the question of unfructifying expenditure. The position in that regard has been made quite clear by my noble friends, and the answer that the noble Lord opposite has given whatever may be its merits, has not taken any account of what we claim to be the special circumstances of the steel industry. In his reply, the noble Lord opposite might have taken a leaf out of the book of his noble friend, Lord Hall, and added "This is politics." I think the point I have made ought to go on record before there is any question of my noble friend withdrawing his Amendment.
VISCOUNT BUCKMASTER: To the other qualities which I have endeavoured to exhibit, the noble Lord, Lord Pakenham, expects me to add one of belief in, and conciliatory acceptance of, the arguments which he has propounded. Certainly I would not wish wholly to reject them, but I would remind him, that apart from the differences to which my noble friend Lord Bridgeman has so clearly drawn such attention, there is this main and major difference in the Steel Industry—namely, that it is the only industry which has been nationalised since the limitation of dividends. That is the particular point I have been endeavouring to make. Not only is this period of dividend limitation tinder the Bill extended, possibly, to August, 1951, but because of nationalisation since the limitation of dividends the Government are able to secure the benefit of the

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increased output of steel, already 3,750,000 tons, which surely should in some degree or other accrue to the shareholders. I do not propose to detain the Committee further in this matter. While I cannot quite achieve the humility which my noble friend expects of me, I will at any rate, with regret, ask permission to withdraw the Amendment.
LORD PAKENHAM: I would like to thank the noble Viscount for withdrawing his Amendment. I am sorry I cannot make a special exception in favour of the steel industry, but I am none the less grateful to the noble Viscount and to the noble Lord, Lord Rennell.
Amendment, by leave, withdrawn.
Clause 18 agreed to.
Clause 19 agreed to.
Clause 20 [Power to acquire securities of certain additional companies]:
LORD LUCAS OF CHILWORTH: Perhaps I may ask the indulgence of the Committee to move together the Amendments at page 25, lines 8 and 10, and at page 26, lines 25, 26 and 32. I give the Committee an assurance that these are purely drafting Amendments. In the interests of time I had better do it this way. I beg to move.
Amendments moved—
Page 25, line 8, leave out ("(a)").
Page 25, line 10, after ("which") insert ("(a)").
Page 26, line 25, after ("that") insert ("the company does not operate or own the whole or a substantial or essential part of works which fulfil").
Page 26, line 26, after ("be") insert ("that the conditions specified in paragraphs (a) and (b)").
Page 26, line 32 leave out ("said conditions are fulfilled with respect to the company") and insert ("contention of the company is correct").—(Lord Lucas of Chilworth.)
LORD TEYNHAM: We are grateful to the noble Lord for putting down these Amendments, which we certainly accept—especially the one at page 26, line 25, which makes it clearer, I think, on what basis a company can serve a notice on the Minister.
On Question, Amendments agreed to.
Clause 20, as amended, agreed to.
Clauses 21 and 22, agreed to.
Clause 23 [Recovery of assets transferred by company which conies into public ownership]:
4.44 p.m.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved, after subsection (4) to insert:
"( ) Where a notice of acquisition is served under this section in relation to any rights in respect of the user of any invention and is not withdrawn or revoked and the person on whom the notice has been served has so developed the invention that there is a substantial difference between the invention as so developed by him and the invention in respect of the user of which the rights were transferred or granted that person shall be entitled to use make and vend the invention as so developed on such terms as shall be agreed between him and the Corporation or in default of agreement settled by arbitration under this Act."
The noble Lord said: This Amendment deals with persons to whom patent rights have been transferred. The clause as drafted deals with the period between October 29, 1948 and the date of transfer. This Amendment seeks to ensure that where patent rights have been transferred between those two dates, and a person has developed new applications in respect of the patent rights which have been so transferred, those rights should be retained by that person in connection with such new development. It is questionable, I think, as to whether the Corporation should be able to reclaim patent and design rights held by companies which will come under public ownership. The Bill as drafted gives that right. I do not want to argue that point; we must concede it. This Amendment says, that if, since that transfer, there has been improvement and development of such patent rights then the benefit of such improvement and development should not go to the Corporation but should remain with the holder. An Amendment was moved in Committee in another place seeking to debar the Corporation altogether from those rights. I do not intend to beg the point on those grounds, as I have said, but it seems only fair that if someone has developed and improved the patents then the benefit of such development and improvement should not accrue to the Corporation. The Minister justified the taking over, or the transfer, of the rights by saying that of course Corporation stock would be given in compensation for such rights. That, I think, is admissible in respect of

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the original rights, but that argument cannot apply with regard to any improvements, and we feel that the rights should continue to be enjoyed, not by the Corporation but by the holder, and that the user should be entitled
"to use make and vend the invention as so developed on such terms as shall be agreed between him and the Corporation or in default of agreement settled by arbitration…"
The point is a perfectly clear one. It is not one on the merits and justice of which there can be much debate. I beg to move.
Amendment moved—
Page 31, line 30, at end, insert the said subsection.—(Lord Balfour of Inchrye.)
LORD LUCAS OF CHILWORTH: I am grateful to the noble Lord for narrowing the issue, but I want his further help because I am slightly confused in regard to the wording of his Amendment. The noble Lord states that this should apply in respect of the user of an invention—by which I assume he means either a patented or a non-patented invention. As regards a patented invention, I suggest to the noble Lord that what he seeks is adequately covered by the Patents and Designs Bill which has just passed through your Lordships' House and is now in another place. If I may make a slight digression, I would mention that only yesterday, during the Second Reading in another place, your Lordships' House was profusely congratulated on the excellence of the work which your Lordships had done when the Bill was passing through this Chamber.
To return to this Amendment, it will perhaps assist the noble Lord if he will refer to Clause 6 of that Bill. I would also refer him to Clause 16 on page 11, and particularly to subsection (2) (d) and subsection (3) (c). I am in some difficulty because the noble Lord speaks of a "substantial difference." In the Patent Law a "substantial improvement" means that the improvement makes a substantial contribution to the art. That means that there is subject matter patentable in the invention. The noble Lord will realise that a "substantial difference" might mean anything, and might have no inventive merit. If there is a substantial contribution to the art, the holder of the patent can get a
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patent of addition, and there is a reciprocal arrangement in this Bill for the granting of a licence to use a patent of addition on terms which, if not satisfactorily agreed between the two negotiating parties, can be settled on reference to the comptroller. I want to tell the noble Lord that he is absolutely covered if the invention has been patented.
Now we come to non-patented inventions, and that is where we get into some heavy seas. One has to ask a lot of questions. For example: Why, if it is patentable, has the invention not been patented? If there has been a substantial difference or improvement why has not that been patented also? Let us accept the fact that there will always be unpatentable inventions. I suggest to the noble Lord that he is fully covered under Clause 23 of this Bill. If he will consider that clause he will realise that it does not give any right to the Corporation to acquire anything without compensation. I suggest that he reads subsection (4) of that clause and also sub-paragraph (c) of paragraph 1 of the Sixth Schedule. He will see that while in the case he cited the Corporation has the right to require the transfer it can be only if mutual arrangements cannot be made between the two parties, and the matter goes to arbitration. Those are factors which the arbitration tribunal has to take into consideration.
If the noble Lord will refer to the Sixth Schedule and look at paragraph 1 (c) at the top of page 76 he will see it is there stated that
"such other property and rights, being property or rights held by the transferor for the purposes of the business carried on by him, as may be so agreed or determined to be property which cannot reasonably be severed from property or rights referred to in sub-paragraph (a) or sub-paragraph (b) hereof and ought to be held in the same ownership."
If the noble Lord considers subsection (4) of Clause 23 I think he will see that where satisfactory terms as between the Corporation and the aggrieved party cannot be arranged, and the matter goes to arbitration, it is laid down that compensation is payable. Therefore I hope the noble Lord will agree that the Amendment is not necessary.
LORD BALFOUR OF INCHRYE: May I ask one question? The noble Lord has dealt with the case where the

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Corporation take over a patent, and compensation is payable. The point I want to put is this. Supposing the original user wishes to continue the use of his patent—we agree that terms must be settled with the Corporation—and also wishes to continue to use the improvements he has made, is he entitled then to use the improvements, without having to pay the Corporation?
LORD LUCAS OF CHILWORTH: This is a very involved matter, and the noble Lord has my entire sympathy. We are now talking about a patent and an improvement to a patent. The noble Lord wants to know what happens in a case where someone has acquired a patent from a company and, having considerably improved the invention, is then compelled to transfer the patent to the Corporation. The noble Lord asks what happens to his improvement and the value attached to it. If the man has patented the improvement—as he can do—he can say to the Corporation: "If you want to operate under the patent of this improvement my terms are so much, and if that is satisfactory to you I will grant you a licence to do so." If it is an unpatented improvement, and he does not want to patent the improvement then the Corporation cannot take that back unless it comes under the terms of Clause 23. So, although the noble Lord has my entire sympathy, for this is a very complicated point, I would assure him that nothing in this Bill cuts across the rights conferred upon the holder of a patent of improvement under the Patents and Designs Bill, and of any unpatented invention, whether original or improved, is covered by the compensation clause here, in lieu of an amicable arrangement between the two parties.
VISCOUNT SWINTON: As I see it there are two cases—the first being that in which a patent belongs to, and is operated by, a company which has been nationalised. That seems quite a simple affair. The patent belongs to the company. Nobody is concerned except the company, which is the owner of the patent or an exclusive licensee. Under this Bill, if it ever goes through, the Corporation can buy all the assets of the nationalised company, including patents. I understand that what my noble friend is anxious about is a third party. It may be that a company which
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is to be nationalised is operating under patent and an entirely independent person, who is not to be taken over, is also using the patent under licence. We are concerned with the rights of the independent person. He may be operating either under a patent or as a licensee. He may be operating an improvement, which he may or may not have patented. He has a right to take out a supplementary patent, if he has added something of substantial value to an invention. On the other hand, he may not have taken out a patent and prefers to rely on the "know-how"—a practice which is probably spreading. Whether he is operating a patent or an improvement, patented or otherwise, it is part of his business. Under this Bill can the Corporation come to him and say it is going to acquire his rights and stop him from carrying on manufacture? If it can, it seems to me to be wholly wrong.
It is quite inadequate for the noble Lord to say that if the Corporation stops a third party, he will get compensation, and if he does not like the amount of compensation he can go to arbitration about it. The third party might say that he does not want to be paid compensation; he wants to carry on his business. If that is so, should he not be allowed to carry on? It seems to me that Clause 16 of the Patents and Designs Bill is irrelevant to this. What Clause 16 does is to provide that if the Government or anybody else wish to obtain a licence to use a patent which is not being used, or is being inadequately used, there is a jurisdiction to grant a licence. But all that is irrelevant here, unless I have misunderstood what we are anxious about. Where a company which is not being nationalised is operating a patent, are we going to prevent it, under this provision of the Bill, from carrying on its business and using that patent exactly as it pleases? If the noble Lord tells me there is no such power under the Bill, and that the company will continue to be free to do what it is doing at present, I shall not worry about it.
LORD LUCAS OF CHILWORTH: I understand that when the noble Lord, Lord Balfour of Inchrye, moved the Amendment, he specifically stated that he did not contest the right of the Corporation to obtain these patents

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originally. That disposes of part of the noble Viscount's argument.
VISCOUNT SWINTON: Subject to any rights which third parties may have in these patents.
LORD LUCAS OF CHILWORTH: Always, I agree. It may be that the Corporation will require to obtain back something that has been improperly transferred, to evade some benefit accruing to the Corporation under nationalisation. There are such cases, of the kind the noble Viscount called "fishy"—I know he does not want to defend them. Or it might be an invention which in the national interest should be developed in one of the Corporation's research laboratories. In such a case there would be an amicable arrangement between the Corporation and the man who held the right, properly acquired. For the Corporation to get back the right, there would have to be a substantial arrangement. If the man was not satisfied with the terms, or conditions, price or compensation, whether it was wholly or partly to go back, or whether future rights would be limited—if he was not satisfied in any way with his bargain with the Corporation, he would have the right to go to arbitration, subject to the provisions of Clause 23 and the Sixth Schedule. If the rights of the acquirer of a patent have been properly acquired, I can see nothing in this Bill to force him to give them up without a mutual and honourable arrangement.
VISCOUNT SWINTON: A free arrangement and not a forced one?
LORD LUCAS OF CHILWORTH: If there is a dispute about the arrangement, the matter can be taken to arbitration. The noble Viscount may rest assured that the third party is absolutely covered.
VISCOUNT MAUGHAM: I should like to say a word with respect to the last point in dispute between my noble friends. It is not the case, is it, that after the company in question has acquired an invention (and I will assume for this purpose that it is not a patented invention) and has granted a right to a third party, the Corporation will have no power compulsory to acquire that right from the third party? In that respect
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the Bill seems to me fairly clear. It provides, in page 30, line 41:
"…that the rights so transferred or granted,—
here are the material words—
"or any rights derived from those rights,"—
that answers precisely the point the noble Viscount, Lord Swinton, has been putting to us—
"should vest in or be surrendered to that company;"—
that is, the publicly-owned company. The third party may have the rights derived from the company, and ultimately from the inventor, taken over by the notice given under the provision which follows—namely, that the Minister
"may authorise the Corporation to serve, at any time within three months after the date of transfer of that company a … notice of acquisition'"—
now note these word—
"on any person in whom any such rights are vested"—
that means third parties as well as other parties—
"stating that those rights are to vest or be surrendered in accordance with the Sixth Schedule to this Act, together with such other property and rights as are mentioned in the said Schedule:"
It seems to me, with respect to anybody who has a doubt, that there is no doubt that the third party rights may be acquired by the Corporation. On the other hand, it seems 10 me that the Corporation have got to pay for them. Whether that is sufficient to satisfy all circumstances that may arise, I do not know. I agree that there are cases in which the third party might be ruined. But the value of the rights taken over has to be paid for.
5.10 p.m.
VISCOUNT RIDLEY: The noble Lord referred to transactions of this kind improperly carried out. It is true that under Clause 23 they will be capable of being reopened. But from the point of view of the purchaser of a patent, it would not be an improper thing for him, between these two material dates, to buy a patent right from any company, as he might not be familiar with this provision in the Bill. So that to the outsider, from the purchaser's point of view, it is not improper. It is he who needs protection. I cannot pretend to follow the intricacies of the legal explanation that has been given. I think all we really want to know is that this covers the case where, as the

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noble Lord, Lord Balfour said, the person who bought the patents has himself relevant supplementary patents, which he wants to use and has a right to use but which he cannot use unless he call also use the original patent. I do not question the fact that the Corporation can buy back the original patent rights, so long as the original quotation which the noble Lord, Lord Lucas, read from the Patents and Designs Bill covers the second party, as he might be called, so that he can obtain a licence to operate the original patent, and so be able to make use of his own patents. I think that is what the noble Lord was saying, and I find it difficult to follow.
VISCOUNT MAUGHAM: I hope what I said was clear, but it may not have been. All I was saying was that third party rights are included in this measure, and can be acquired by the Corporation. I do not express any opinion about this particular Amendment.
LORD BALFOUR OF INCHRYE: It seems to me that the noble and learned Viscount, Lord Maugham, has put a case which is in direct contradiction to the case which was put by the noble Lord, Lord Lucas. I understood the noble Lord, Lord Lucas, to say that a third party holder of rights could not have his rights taken away from him unless he entered into an agreed, amicable arrangement.
VISCOUNT MAUGHAM: I think that was a slip on the noble Lord's part.
LORD LUCAS OF CHILWORTH: May I clear that up? The noble Lord, Lord Balfour, is right. He could not have them taken away from him without compensation.
LORD BALFOUR OF INCHRYE: We are not worried about compensation. It is the possession of the rights which is worrying us on this side of the House. If what the noble and learned Viscount, Lord Maugham, has said is correct—and I am sure it is—then we have the position that the Corporation, who we are told are to be in no different position from other enterprises in the same field of competition—they are not to have an advantageous position—are placed in the position whereby the Minister can authorise them at any time within three
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months compulsorily to take those rights I grant the noble Lord that compensation would be payable, but does he agree that the Corporation would have the right compulsorily to acquire such rights and to use them themselves?
LORD LUCAS OF CHILWORTH: The noble Lord conceded that point. I thanked him for narrowing the issue. He said: "I do not contest the right of the Corporation to acquire these rights." I then proceeded upon that basis. The noble and learned Viscount, Lord, Maugham, is quite right in saying that it covers the third party, but the Corporation will have to pay, Unless the consideration is satisfactory it has to go to arbitration.
LORD BALFOUR OF INCHRYE: I am sure the noble Lord does not wish to misrepresent me. What I said was that I did not contest the right of the Corporation to acquire the rights which have been disposed of by a concern which has been taken over if such disposal has occurred between October 29, 1948, and the date of transfer. My Amendment deals with the improvements of such rights. It is on that point that I am taking the stand that the improved rights should not be compulsorily taken away from someone who has developed them, and wishes to continue to use them.
LORD LUCAS OF CHILWORTH: I can only repeat what I said. If you are talking of a patented invention, you are completely covered. I would suggest that you are also covered in an unpatented invention, because the arbitration has to decide this point if the arrangement between the Corporation and the individual is not satisfactory. Let me take a hypothetical case, The Corporation acquire the invention, and the individual says: "What am I going to do? I cannot go on with the improvement unless I can work the invention. My addition to the invention is useless to me if I cannot have the original invention." It is covered in the Sixth Schedule as plainly as anything could be; it uses almost specific words to cover it. Thus, if the Corporation want to do that, then they have to buy the man out at a price which I can only assume will be satisfactory to the individual. If it is not, then he can go to arbitration. If the noble Lord looks at the Sixth Schedule

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I do not think he will have the slightest doubt.
VISCOUNT SWINTON: I now understand it, and the more I understand it the less I like it. I certainly do not want to catch anybody out on what he said or did not say, because, after all, we are trying to do what is right here. We achieve, it only by a process of exploration, thinking aloud and making suggestions. I want to say at once that I do not in any way want to defend what we call a "fishy" transaction. If someone has done something in order to evade the purpose of this Bill, then I am not concerned. But do let the Committee remember that what we are concerned with here is not just making ingot steel; we are concerned with hundreds of different sorts of manufactures down to racquets, and I do not know what. I saw a list of the things that are to be done that went into pages. We were saying last night that we want all these firms to go on and conduct their business in the most businesslike way, and not to be held up for fear of something in this Bill. I am concerned with the perfectly genuine transaction, where a publicly-owned company has given a licence to an outside firm to manufacture something, and that firm may, or may not, have made an improvement. I think it is a little strong that the Corporation, when they come into being, should be able to "claw back" rights which have been quite genuinely, and in a businesslike way, alienated to somebody else. I should have thought the reasonable thing was that it should be taken over subject to the contracts which were entered into.
Let me concede to the noble Lord that as from this date—October, 1948, is it not?—when the Corporation come into being they may use this process of manufacture (which I assume is permitted to them as one of the processes under the Bill) whether it is patented or not. Let them have the power to do that, though it is a power which no steel company or any commercial company in the world has to-day. It is, oddly enough, a power which even a Government Department do not possess to-day, unless under Clause 16 of the Patents and Designs Act they get a licence to do it. I concede to the noble Lord that the Corporation will have the right to use that process on whatever are fair terms. What I cannot see is why they
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should claim to have the whole of that right surrendered to them exclusively. Supposing Dunlop's had a licence, or the right to use a patent, in making racquets, not only could the monopoly Corporation compulsorily take the right to carry out that manufacture under that process, but they could say: "We are going to stop the licensee going on with it." The licensee may well say: "But I do not want you to compensate me, except as to what is fair for your using it as well. I did not obtain this patent in order to make any money in dealing with it as a patent. I obtained this patent because wanted to use it in my manufacture.' Why should you stop him?
LORD LUCAS OF CHILWORTH: But you cannot.
VISCOUNT SWINTON: But you can, according to the noble and learned Viscount, Lord Maugham. Look at line 40. It is said that
"Where … it is in the public interest"—
I do not know what that is. "In the public interest" may mean in the interest of the Corporation. It says in paragraph (b)
"… for the purpose of securing the efficient currying on of the business of any publicly-owned company"—
I am not saying that it would not make that company do its work more effectively—
"that the rights so transferred or granted…."
That is what is vetted in the outside party.
VISCOUNT MAUGHAM: No, it is the next words.
VISCOUNT SWINTON: It goes on:
"or any rights derived nom those rights, should vest in or be surrendered to that company."
As I read it, that means that the Corporation, or one of its subsidiaries, can acquire the exclusive right of manufacture. Am I wrong?
VISCOUNT MAUGHAM: I think that is quite right.
VISCOUNT SWINTON: The noble and learned Viscount, Lord Maugham, says that I am right, and the noble Lord, Lord Lucas, says that I am wrong.
VISCOUNT MAUGHAM: I say that you get the monopoly if you acquire all the rights that you want to monopolise.
VISCOUNT SWINTON: That is exactly what I say, and really I do hope the noble Lord is not going to ask for that. It surely is enough that he should say: "My monopoly would be able to acquire a concurrent right of manufacture." I cannot see why he should stop the outside company from going on with the manufacture for which it acquired the right.
LORD LUCAS OF CHILWORTH: I think it would be advisable if we got back to the Amendment. The Amendment is in specific terms.
VISCOUNT SWINTON: I do not think so. It is perfectly simple to dispose of this Amendment and I hope the noble Lord will do so. If not, I will move to strike out this clause. That is perfectly simple and perfectly in order, but I think it would be for the convenience of the Committee that we should discuss the whole issue.
LORD KENILWORTH: May I be excused for saying a few words as one who has had much to do with patents in the past? They are taken out either in the name of an individual, or the company employing the individual and the individual. In the latter case, it is generally agreed that the company has right rendered to them exclusively. Sup-the individual. Now, as I understand this matter, it is a question of the company taking over the undertaking which has these patent rights. These matters are always covered by agreements, and the agreements always stipulate as to how they should be dealt with and what royalties should be paid. It seems to me a simple matter of ordinary business, and there should not be any misunderstanding about the matter. If you buy a patent from a man who is not in your employ, he has an agreement with you. He either grants you exclusive rights or retains the rights for himself. Now where does this matter stand? It seems to me that you are talking of a patent owned by a company, or else being used by a company under licence. If it is owned by the company and it is taken over, the company goes with its patents. If it is using the patent under a licence, the terms of the licence are quite definite. I fail to follow the intricate arguments which are now passing to and fro from one side of the House to the other.
VISCOUNT RIDLEY: Before the noble Lord takes the discussion any further, may I ask one question which I hope will be simple? I am prepared to accept the noble Lord's explanation of the patented invention, but I do not follow how an unpatented invention could come into this argument. A patented invention can, in fact, be bought by anybody. I do not quite see how that is a matter which can be bought or sold. One firm will no doubt pay another something to send people to their works to show them a process. I do not see how you can buy that back.
VISCOUNT MAUGHAM: It may be a secret process.
VISCOUNT RIDLEY: It belongs to the original company who gave the information which was sold to the other company. They do not sell their knowledge, because they cannot forget matters of that sort.
VISCOUNT MAUGHAM: Very often they do sell their knowledge, and they covenant not to use that particular invention.
LORD LUCAS or CHILWORTH: I hope I am not intruding in this debate, but I think we had better get back to the Amendment. Therein lies the secret of the whole thing. The noble Lord, Lord Kenilworth, is absolutely right. Nothing in this Bill can upset the patent law, so we can dismiss from our minds completely any patented invention. We now get to the unpatented invention. As I said when I started, we are then in the deepest of deep waters, so well illustrated by the noble Viscount, Lord Ridley. It becomes nothing less than a property which has to be established. The noble Lord is very anxious to know how the man stands who wants to carry on the improvement. As there is no patent and, as the noble Viscount, Lord Ridley, says, if somebody can get the "know how" by putting a spy into somebody elses works—which I believe is done every day of the week.
VISCOUNT SWINTON: Is it?
LORD LUCAS OF CHILWORTH: Yes. If that is done, anybody can make it. There is no legal redress against the copying of a non-patented invention,

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because I do not know what a non-patented invention is. The legal profession will have the dickens of a job to determine what is a patentable invention or what an invention is. I need not go into that—we went into it on the Patent Bill. But this is what the noble Lord, Lord Balfour, really wants to know. Here is a man who owns some property, the "know-how," or whatever you like to call it. The Corporation, having satisfied certain arrangements, say it is in the national interest that this should come back to the Corporation. The man says, "Very well, but how am I to be compensated; because I have spent a lot of time on this?" I say that in Clause 23 and the Sixth Schedule every conceivable thing that we can think of is covered. If the noble Lord can think of anything that is not covered that should be covered to compensate a man for any loss, then I will consider it.
VISCOUNT SWINTON: Nobody challenges the right to compensation. It is the right to continue.
LORD LUCAS OF CHILWORTH: It may be that with a non-patented invention the first negotiations must be between the Corporation and the individual. He cannot conclude anything until he has had some discussions. Somebody must arrive at some conclusion, and I expect eventually the lawyers on both sides will do that. What has the man to take back? What has he to claim compensation for? You are talking about a "substantial difference" and I do not suppose any lawyer knows what a "substantial difference" is. I suggest to noble Lords that this cannot upset anything in the patent law but that anything of an unpatented nature must be the subject of negotiations between the two parties, and if an amicable settlement cannot be reached, then I suggest it had better be settled by the courts, because I do not think we can settle it here.
LORD BALFOUR OF INCHRYE: 'This is very deep water for a layman who is not a lawyer to be debating. I do not think I can carry the matter any further this afternoon. We shall read what the noble Lord has said in Hansard and we shall take advice from our legal friends. We may have to return to the matter on the Report stage, not only on this Amendment but on the
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whole matter of rights. Having said that, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 23 agreed to.
Clause 24 agreed to.
Clause 25:
Other transactions resulting in dissipation of assets.
25.—(1) This section shall apply where any company which comes into public ownership under this Part of this Act has, after the twenty-ninth day of October, nineteen hundred and forty-eight and before the date of transfer—
(a) made any payment to any person without consideration or for an inadequate consideration;
and the payment, sale, disposal, acquisition, agreement or variation thereof, or other transaction was not reasonably necessary for the purposes of the company or was made with an unreasonable lack of prudence on the part of the company, regard being had in either case to the circumstances at the time:
5.33 p.m.
LORD HAWKE LORD HAWKE moved, in subsection (1) to omit all words beginning "reasonably necessary" down to the start of the proviso, and to insert:
"a proper transaction made in the ordinary course of business regard being had to the circumstances at the time and was connected with a provision made by this Act or with an anticipation of the making of such a provision."
The noble Lord said: My Lords, we have already had discussed a very similar clause in Clause 13, when we moved the Amendment to page 12, line 31. There is, however, some slight difference which I will outline. The first clause was to undo leases or agreements which ought not to have been made. This clause seeks to place responsibility for undue dissipation of assets. In the other case the Corporation could serve a notice on the company to disclaim the lease or agreement, and the company had its remedy in going to arbitration. In this case the Corporation may refer the transaction to arbitration and the arbitration determines the degree of, and the responsibility for, the loss. In neither case is it definitely clear in the Bill on whom the onus of proof lies before this arbitration tribunal. On the Amendment to Clause 13, Lord Lucas told us that the onus is on the Corporation. His words

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are in the record and we are to have conversations with him to see whether it can be made more certain in the Bill. In this case I should have thought that the onus was more definitely on the Corporation, but I would suggest to the noble Lord that he should agree that our consultation should cover this clause as well as Clause 13. If that is so, I am perfectly prepared to withdraw this Amendment. I move.
Amendment moved—
Page 34, line 13, leave out from ("not") to end of line 17, and insert the said new words.—(Lord Hawke.)
LORD LUCAS OF CHILWORTH: I am very grateful to the noble Lord, Lord Hawke, for raising this Amendment in the manner he has, because I think it has provided me with an opportunity of removing the last lingering doubt that may be in his mind that his interpretation now is quite correct. Just as in Clause 13 the burden of proving that the agreement or lease ought to be disclaimed is on the party seeking to disclaim it, so, under this clause, the burden of proving that a transaction complies with the test laid down in subsection (1) will be on the Corporation. That is secured by subsection (3).
LORD HAWKE: Are you referring to this or the previous Amendment?
LORD LUCAS OF CHILWORTH: I am referring to the clause we are discussing now, which requires the arbitration tribunal to be satisfied that a transaction referred to them is a transaction to which this clause applies. This is what the clause involves. The, transactions are set out in paragraphs (a) to (e). The tribunal can hardly be satisfied that the transaction in respect of which the application was made was a transaction to which the clause applies unless they have evidence to prove that it did so, and the onus of proving the facts within subsection (1) would certainly not be discharged by the defendants; it would have to be discharged by the Corporation. If the arbitration tribunal are not satisfied that the transaction falls within subsection (1) they cannot make an order against any party to the transaction by subsection (3), so a similar result in this case is arrived at as would be arrived at in Clause 13. I
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hope that instead of taking up the noble Lord's time in consultations (which I shall be only too happy to have because I know they will be very agreeable) I have removed the last lingering doubt in his mind that the burden of proof on the Corporation in Clause 13 and in this clause is definite. I hope, therefore, that he will withdraw his Amendment.
THE MARQUESS OF READING: Having intervened in the earlier debate, perhaps I might be allowed to say one word. I confess that the noble Lord, Lord Lucas, has not yet convinced me of the accuracy of his argument. I quite realise that the word "satisfy" is in this clause, and the tribunal have to be satisfied ultimately as to what is the true position. What is not clear in either of these clauses is whose responsibility it is to undertake the task of satisfying. That does not appear anywhere. There are two possible approaches, in the first case (the Clause 13 case, if I may go back for a moment, because it is convenient) the Corporation may say to the company: "You have shown an unreasonable lack of prudence." They may begin by saying that. The company may reply: "No, we have not." The other way is that the company has to begin and say, "We have in those circumstances not shown an unreasonable lack of prudence," and the Corporation say, "Yes, you have." Now the tribunal have to be satisfied which of those two contentions is right in either of those methods of approach. But what is nowhere set down is what we on these Benches think ought always to appear, and that is the correct method of approach. We think it is the one in which the person taking exception is put in the position of a plaintiff having to carry the burden of making out a prima facie case.
LORD LUCAS OF CHILWORTH: I thank the noble Marquess for his helpfulness now and on previous occasions. We say that it is our intention to employ the approach mentioned by the noble Marquess. The Corporation say to some company, "You carried out this transaction without reasonable prudence, and you ought not to have done it." The company reply, "We did no such thing." Then the burden of proof lies on the Corporation to satisfy the tribunal that their contention is correct. That is what we are saying in this Bill. The noble Marquess

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says: "Yes, that may be your intention, but the words are not quite specific enough for me."
THE MARQUESS OF READING: Not nearly specific enough.
LORD LUCAS OF CHILWORTH: I would invite the noble Marquess to take part in the discussion which Lord Hawke and I are to have. We should be grateful if the noble Marquess would give us the benefit of his profound knowledge of these matters.
VISCOUNT SWINTON: I am very much obliged to the noble Lord for repeating this statement, that wherever the Corporation seeks to pray in aid the right to set aside a contract on the grounds that it was entered into with an undue lack of prudence, the onus of proof must always be on the Corporation. We obviously have a common intention, and it ought therefore to be extremely easy, when we get down to drafting, for us to see a way of satisfying both sides. I think the right course to adopt would be to withdraw the Amendment as it is now worded and let our draftsmen get together and look at it. I think they should have a very easy task.
LORD LUCAS OF CHILWORTH: I hope the noble Viscount is right in saying that the draftsmen's task will be easy. I think that perhaps the hardest task we shall have now will be to get the respective lawyers to agree.
VISCOUNT SWINTON: I do not think so.
THE MARQUESS OF READING: I disclaim any of the profound knowledge which the noble Lord has been good enough to attribute to me, but if he thinks I can be of any use by joining these discussions I shall be very happy to do so.
THE EARL OF DUDLEY: It is essential, in my view, that the words "reasonably necessary" should be eliminated. Who can possibly judge what is "reasonably necessary"? Let me give your Lordships an example. Some time ago I built a range of new furnaces which I think I can charge with two charging machines, though I am not sure. I am advised by an expert that I should have a third charging machine. In the national interest I cannot take the risk of not ordering that third charging machine. This is a costly piece of machinery, and
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it takes two or three years to deliver. Now, if I find when the workshop is complete and the Government take over that two charging machines are sufficient, the third becomes redundant—and by that time it will probably be possible to buy a charging machine at a much lower price than now. The Government can say to me "You did not exercise reasonable judgment when ordering that charging machine and we are not going to take it over it will be your responsibility." That is the sort of thing that is liable to put one in an extremely difficult position. I hope, therefore, that these words "reasonably necessary" will be eliminated altogether and that we shall have some such words as, for instance, "a proper transaction made in the ordinary course of business, regard being had to the circumstances at the time."
VISCOUNT SWINTON: It is our hope that in the course of the discussions which we are to have on the question of getting the right words concerning the onus of proof, the point which the noble Earl has just raised will be dealt with.
LORD HAWKE: In the light of those undertakings and assurances, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn,
Clause 25 agreed to.
Clauses 26 and 27 agreed to.
Clause 28:
Transfer of certain assets of Ministers and Government Departments to the Corporation
28. The Minister may, after consultation with the Corporation, provide for the transfer to the Corporation, on such terms as may be determined by the Treasury, of any property or rights held by any Minister of the Crown or Government Department for the purpose of the carrying on, whether by that Minister or Department or any other person, of any of the activities specified in the first column of the Second Schedule to this Act or any other activities which the Corporation are for the time being authorised to carry on.
5.47 p.m.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved to add to the clause:
"and the terms upon which any such property or rights are transferred to the Corporation shall be published in the report of the Corporation to be made under section four of this Act."
The noble Lord said: In rising to move this Amendment I am very optimistic that here we have one to which the Government cannot possibly take any

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exception. The Amendment aims at ensuring that the terms of transfer to the Corporation of a Government-owned undertaking are made known to the public by publication in the annual report which the Corporation is obligated to provide. I am quite sure that your Lordships on all sides of the House would feel that everything should be known about the financial transactions and that these transactions should be judged upon their merits. In respect of assets taken over by the Corporation from privately-owned concerns these facts are known, and we cannot see why the same revelation should not apply in the case of publicly-owned companies. In fact, I suppose, the largest number of acquisitions of Government property will be in the early life of the Corporation, and therefore the first and second annual reports would be the reports that would contain most of this information. But I think the public is entitled to know on what terms the Corporation acquire Government property, because if the Corporation acquire Government property cheaply at a bargain figure, the taxpayer should know. If, on the other hand, the Corporation acquire assets at an inflated price, we know that the Corporation will be taking on an unnecessary capital burden, on which they will have to earn interest. I sincerely hope that the Government will not find any objections to this Amendment and will be able to accept it. I beg to move.
Amendment moved—
Page 36, line 40, at end insert the said words.—(Lord Balfour of Inchrye.)
VISCOUNT RIDLEY: I should like to support this Amendment. It seems a simple enough matter. Any Government property such as this will be subject to review by the Public Accounts Committee or may be referred to the Select Committee, so it is not information which would normally be kept secret or which there would be any point in keeping secret. It seems rational to ensure that these items of expenditure are put in their proper place.
LORD MORRISON: I am much obliged to the two noble Lords for the manner in which they have moved and supported this Amendment. The noble Lord, Lord Balfour of Inchrye, said he was in an optimistic spirit. I am sure he will have reason to be satisfied with
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my reply, for I can reply in an optimistic spirit by saying that we have considered this matter and think the Amendment is a useful one. I have pleasure in accepting it.
On Question, Amendment agreed to.
Clause 28, as amended, agreed to.
Clause 29:
Activities in Second Schedule not to be carried on except under licence
(2) A licence issued under this section may be issued on such terms and conditions as the Minister thinks fit, which may in particular include conditions—

(a) limiting the period for which the licence is to be in force;

(b) limiting the extent to which any of the said activities is to be carried on; and

(c) imposing restrictions as to the persons to whom the products of those activities may be sold, and in particular for conferring on the Corporation an option to purchase any such products;

and before issuing a licence under this section, the Minister shall consult with the Corporation.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved, in subsection (2) to omit "such terms and conditions as the Minister thinks fit, which may in particular include." The noble Lord said: We now take a most important clause in this Bill which deals with licensing powers. There is a series of Amendments down on the Order Paper. I wish I could suggest that we should take them all together, but we cannot do that as, with the exception of two of them, they deal with different subjects. The first Amendment which I move is to provide that the Minister, in issuing a licence, may impose only the conditions specifically enumerated in the subsection, and no others. I find it difficult on general grounds to understand why the Government should require any licensing provisions at all. If, as the Government claim, the establishment of the Corporation results in more efficient working and more economical production of iron and steel products, it must be difficult for independent producers to compete with this very efficient instrument, in which case there seems to be no need to license them. Independent producers will find it difficult to stay in business at all against this new and efficient instrument. But if, as I suspect, the Government really feel that the

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Corporation need protection against substantial competition, then, of course, the corollary is a licensing system such as is introduced in this clause. For that reason, and in the interests of planning, if a licensing system is required, it seems to us that a licence should contain only conditions which would limit the extent of the output and the life and duration of the licence, and possibly, it is arguable—we shall come to it later—give the Corporation an option to acquire the production of the competitors.
LORD STRABOLGI: May I interrupt? How many of the Amendments to Clause 29 hang together? Do they all?
LORD BALFOUR OF INCHRYE: No.
LORD STRABOLGI: Then which do?
LORD BALFOUR OF INCHRYE: I am sorry if I have not made it clear. The two Amendments that hang together are the Amendments to page 37, line 15, and page 37, line 16. I will deal with the others separately.
LORD STRABOLGI: The Amendment the noble Lord is moving is the one to page 37, line 10?
LORD BALFOUR OF INCHRYE: Yes. That is the first one, with which I am dealing now.
LORD STRABOLGI: Then the other two Amendments are not dependent on that?
LORD BALFOUR OF INCHRYE: No. It is very complicated. I will not take up longer time than is necessary. The Committee will appreciate that they are different points.
LORD STRABOLGI: And very important ones, too.
LORD BALFOUR OF INCHRYE: Yes. We feel that those are all the conditions that the licence should contain. We take exception to the broad powers given the Minister for imposing conditions, because, if your Lordships will read subsection (2) you will see that it says:
"A licence issued under this section may be issued on such terms and conditions as the Minister thinks fit, which may in particular include"—
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and then certain provisions set out. "As the Minister thinks fit" are really omnibus words which would allow the Minister to include any number of conditions. The effect of this Amendment is to limit the conditions. I suggest that, in the interests of the competitors who will be struggling against this Corporation in not easy circumstances, they should know under what conditions they can apply for and obtain a licence, and that the Minister should not have these wide powers. I beg to move.
Amendment moved—
Page 37, line 10, leave out from beginning to ("conditions") in line 11.—(Lord Balfour of Inchrye.)
LORD MORRISON: Having made such a good beginning in the last Amendment, it would just be my luck that I am unable to keep up the pace. The issue which the noble Lord has raised is not, in my opinion, such a very important issue. Compared with some of the other issues raised in this Bill, it is comparatively unimportant. As no doubt my noble friend knows, it was discussed in another place, both in Committee and on Report, but on that occasion the Opposition argued that the licences should be granted unconditionally; or, alternatively, that the Minister should have no right to impose the conditions shown in paragraphs (a), (b) and (c). In his present Amendment, the noble Lord is not now asking for licences free of conditions. What he is asking is that the conditions imposed by the Minister shall be strictly limited to those contained in paragraphs (a), (b) and (c).
LORD BALFOUR OF INCHRYE: As they may be amended later.
LORD MORRISON: Yes, by the other Amendments; that is without prejudice to the subsequent Amendments that may be moved. I agree that the conditions shown in paragraphs (a), (b) and (c) are the principal ones and we will deal with that when we come to them. The point of my reply, and the only point of my reply, on this particular Amendment, is that there is a possibility that there may be other conditions. If the noble Lord will grant for the moment the fact that he now agrees that the Minister should have authority to issue a licence, and that the licence should contain certain conditions, I now put to the noble Lord that it is not possible to

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foresee, for the purpose of including a comprehensive list in the Bill, every matter that may have to be the subject of a condition in a particular case. In other words, it seems to me that it is necessary in an important Bill of this kind not to tie the Minister upon whom you are putting the responsibility of issuing the licences—not to bind him hand and foot so that he is unable to meet some position which possibly at the moment we cannot foresee. I hope, therefore, that noble Lords will see that it is necessary to retain the words as drafted. While, as I have already said, paragraphs (a), (b) and (c) as contained in the Bill now, and which we shall discuss presently, may give the principal conditions which the Minister is most likely to impose, it is possible that there may be others. It is in order to meet that contingency that I resist this Amendment.
LORD LLOYD: I should like to say a word on this matter because I feel that the noble Lord has not quite seized the point that my noble friend was trying to make. Perhaps I could bring that out more fully if I were to read to your Lordships the main point in the Minister's speech when he defended this particular provision and said that the Government's case for licensing was necessary. He said:
"To ensure that there is no waste of resources and that they are not devoted to the creation of steel making capacity which is unnecessary, we say that anybody who wants to enter the iron and steel field can only do so as part of our general plan."
I am prepared to concede to the noble Lord that there was something in that point. All I think that my noble friend was saying was that that is the only real condition about which it is reasonable to impose a licence, and that all these other conditions are unnecessary. I do not feel that licences should be issued on a lot of unspecified conditions. I do not feel that the noble Lord has really quite met that argument.
LORD STRABOLGI: I am reluctant to support any argument on this Bill from the other side of the House because I do not think their intentions are quite so correct as mine. But in this particular case I feel a little anxiety. I think the words
"such terms and conditions as the Minister thinks fit"
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are a little wide. If my noble friend would turn to page 63, to the Second Schedule, he will see specified the first three items for which licences are required—namely, the fabrication of steel or the getting or smelting of iron ore. But the fourth is very wide—namely,
"the changing of the cross-sectional dimensions or cross-sectional shape of steel by hot rolling in a rolling mill."
That is a very intricate process which is continually improving and progressing, and it is not strictly a part of steelmaking at all. I should have thought that it would be to the advantage of everybody, including the general public, if licences were granted in approved cases. I think the withholding of the licence should not be made too easy, as I feel it is under the wording of this Bill. The words
"such terms and conditions as the Minister thinks fit"
are very wide, and particularly with reference to the fourth paragraph of the Second Schedule. I think we should consider this matter again. As I say, I am not anxious to embarrass my noble friend by sniping him from behind—that is not my intention at all—but I think this is a point of substance.
6.2 p.m.
THE EARL OF DUDLEY: New techniques are coming into force every day and will continue to come into force in these modern days. Suppose that a concern develops a new technique in iron and steel-making and wants to enter the field of iron and steel-making with this new technique, or, alternatively, suppose that a concern which did not come under the Second Schedule, and was granted a licence of right Wished to develop a new technique and applied for a licence to increase its tonnage. The concern would go to the Minister to apply for a licence and the Minister could—and probably would, in the ordinary course of business—say, "Yes, I will grant you a licence to cover that technique up to a certain tonnage within the limitation set down under the clause, but only on the condition that you grant all rights and patents appertaining to that technique to the Corporation and its subsidiaries." Is that a fair condition, or is it not? Those are the conditions we are trying to guard against in this Amendment.
LORD BALFOUR OF INCHRYE: If I may say so, I do not think the Minister has dealt with the cases which we had in mind, an example of which has just been given by the noble Earl, Lord Dudley. Let me reply to only one point of his, with regard to the difficulty of defining conditions. That is not an original difficulty. In engineering industries there are many licences given by one firm to another and they are all specific documents setting out exact terms. If all the terms and conditions in ordinary industrial life can be set out, it is not really very convincing to be told by the noble Lord that it is impossible for the Corporation to set out terms. It is done in ordinary engineering. I wonder if we can find common ground to meet the point made by Lord Dudley, and also by Lord Strabolgi. Supposing, to use the words of the Minister himself, the subsection were amended to read:
"A licence issued under this section may be issued on such terms and principal conditions…."
The drafting would have to be looked at, but the point I am trying to make is that if we had something showing the principal conditions of paragraphs (a), (b) and (c), it would imply that there was to be no great restriction imposed in the licence such as has been envisaged by Lord Dudley; though it would give the Minister that freedom for small alterations and amendments and conditions of a licence beyond paragraphs (a), (b) and (c) which he might find necessary. Would the noble Lord consider that between now and a later stage of the Bill? I think we have a common desire, and that we could find common ground through some agreed Amendment.
LORD MORRISON: I have already said that paragraphs (a), (b) and (c) are the principal matters and therefore what the noble Lord has said follows, although the word "principal" is not in the Bill at present. I agree largely with the noble Lord, but what I am trying to cover is something which happens but which no one can foresee—the unexpected. The noble Lord says that it is necessary to put dawn the conditions upon which the licence is obtained, but there may be something else that will arise. For example, it might be necessary for the Minister—I do not know—to put down conditions as to the submission of returns
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of the licensed output—I give that as one example of what might be done. However, I do not think we need spend a great deal of time on I am willing to look at any modified Amendment put down by the noble Lord at the next stage, I say nothing beyond the fact that I will promise to look into it. I am advised that the reason for this Amendment is that conditions may arise which it is impossible to foresee. That is an entirely different thing from assuming that the Minister is going to try to trip everybody up. I do not think that argument would cut any ice. But if the noble Lord will withdraw his Amendment and put down some other words, I will see that they are examined between now and Report.
LORD BALFOUR OF INCHRYE: I am bringing the noble Lord towards me slowly. Could he come a little further and say that between now and the next stage we might have consultations in order to see whether something we put down is acceptable, because we do not want suddenly to confront the Government with an Amendment at the last moment on Report stage. It would be much better to come to some agreed Amendment to achieve the common purpose.
LORD MORRISON: I agree to that—all the more because on Report stage we do not have the free and easy debate we have now. Therefore, I shall he happy to join in any consultation.
LORD BALFOUR OF INCHRYE: I thank the noble Lord, and I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD BALFOUR OF INCHRYE: This is a different point. The purpose of this Amendment is to ensure that the Minister, in limiting the period for which a licence shall be in force, takes into account the capital cost of the undertaking which he is licensing. This matter was discussed in another place, when I think the Minister undertook to consider re-drafting paragraph (a), but unfortunately no re-draft has appeared in the Bill. The Solicitor-General in another place said, in point of fact:
"The Minister will consider what will be a reasonable duration for a licence in the circumstances, and obviously he will take into account the amount of capital expended on the venture."

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The Amendment really seeks to read into the Bill the assurance which the Solicitor-General gave in another place. If there is no such reference in the Bill, the Minister might issue a licence for, say, five years or some other period too short to allow the capital expended to be amortised. It might require amortisation in ten, twenty or more years, and it would obviously be unacceptable to any enterprise to acquire a licence for such a very limited period in respect of plant which had to be written off over a lone time. I think the purpose of the Amendment is quite clear, and I trust the argument in support of it is, too. I beg to move.
Amendment moved—
Page 37, line 13, at end insert ("so however that the Minister in limiting the period shall have regard to the capital expenditure involved").—(Lord Balfour of Inchrye.)
THE EARL OF DUDLEY: I should like to support this Amendment which has been so comprehensively moved by my noble friend, Lord Balfour of Inchrye. Obviously, a person desiring to apply for a licence to manufacture iron and steel in any shape or form is not going to be much encouraged unless he knows that the licence will be granted for such a period that he may be sure there is "some future in it," and that he will have an opportunity to recoup himself in respect of his capital expenditure. My noble friend has quoted the statement of the Solicitor-General in another place in reference to this matter. He said also:
"It would not be very attractive for any new entrant, if he were offered a licence which did not enable him to recoup himself in respect of the amount of capital involved in the undertaking upon which he was embarking."
I agree that in such circumstances it would be foolish to go in for the project at all. I hope very much that the Minister will see the point of this Amendment. It is a very reasonable and very harmless one. If that is what the Minister and the Solicitor-General think, then by all means let us have this put into the Bill in the form of this harmless Amendment. Surely the Minister wants to encourage these entrants in the field of iron and steel. These small men who make specialities are very important to the consuming trade—they are what you might term hucksters. If they are not encouraged the trade will suffer. It is impor-
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tant that some longer time than they can look forward to at present should be provided for in the Bill. Under this clause as it would be amended by this Amendment they would, at any rate, know that the Minister was bound to take into account, when granting a man a licence, the amount of time it would take him to recoup himself for the capital he put into his business.
LORD MORRISON: It seems to me that on some of these Amendments, and on this one in particular, noble Lords are rather apt to take up a position which suggests that the Minister will merely give a decision, that he will grant a licence or not grant it, without paying full attention to all the relevant circumstances. I think that this Amendment is quite unnecessary. Noble Lords have already accepted the position that the Minister may either refuse or grant a licence subject to conditions. Surely it is only common sense that when the Minister has been given the power to refuse or grant a licence, the final say as to the conditions should be his. It seems to me also to be obvious that before deciding to grant a licence at all the Minister will have to take into account the duration factor and also the capital expenditure involved in the project which is put before him. In practice, of course, I am sure that no one would expend capital and so incur a loss, as he would if the period for which the Minister was prepared to grant the licence was not reasonably sufficient for him to recoup himself.
The noble Lord who moved the Amendment said that this point was discussed at some length in another place. The Opposition there argued that the Minister might use his power to impose a time limit with the object of excluding new entrants to the Second Schedule field. My answer to that is that the Minister—any Minister of any Government; I emphasise that—will grant a licence when he is satisfied that there is a good case for it. If he does not consider it proper to issue a licence he will not do so. If he is satisfied that the proposed production is desirable, there is no reason why he should obstruct the development concerned by proposing awkward conditions as to the duration of the licence. For these reasons I am unable to accept this Amendment. I

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would add two further reasons which are on another plane altogether. As I am advised, the legal effect of this Amendment would be that the Minister's decision as to the period for which a licence should run could be challenged in the courts. This would create an impossible situation. The second reason is that from a technical point of view this Amendment could not possibly be accepted because it leaves entirely undefined what the words "the capital expenditure involved" are intended to comprise.
LORD CLYDESMUIR: I had not intended to intervene, but I feel unhappy about the Government's attitude towards this Amendment, because it deals with a very real point which is seriously regarded in the steel trade. In the steel trade, particularly, capital expenditure is bound to be high, and any entrant into a process will have very high costs in preparing his plant. Assuming that the Minister is anxious to see reasonable development and is studying the public interest—and that, of course, will be his main wish—is it not desirable to give as much security as possible to the man who it is agreed (otherwise he would not get a licence) is to be allowed to enter the trade? I appreciate what the noble Lord, Lord Morrison, has said about the wording of the Amendment. Perhaps the wording is not wholly acceptable, and indeed, we were expecting that after what was said in another place there might have been a draft put forward for our consideration here. If the noble Lord cannot accept the Amendment it might be possible to consider whether between now and the Report stage some form of accommodation could be devised that would allay the anxiety of people entering into this trade as regards the period of licences. It is most undesirable to discourage those who will be making a real contribution to the welfare of the country.
LORD LLOYD: I listened with great care to the speech of the noble Lord, Lord Morrison, and I must confess that I was slightly fogged by it. At the end of his speech he raised a couple of legal objections to the Amendment upon which I am not qualified to speak. Other noble Lords present to-day certainly are, and perhaps they will give us their views as to the validity of those objections. I do
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not presume to say anything. Apart from those two legal objections the noble Lord's main contention was that this was what any Minister would do. Any Minister, the noble Lord said, would have regard to the capital expenditure. Having said that, could he not possibly accept the Amendment? I cannot quite see why, if it is agreed that any Minister is going, to do this, there should be any harm in putting it in the Bill.
LORD MORRISON: The answer to the noble Lord's point is that there must be an objection on the ground of common sense to putting unnecessary things into a Bill. Why should it be assumed, as would seem to be indicated by Amendments such as this, that any Minister who is going to be in charge of this scheme is almost bound to be a first-class fool, and that he should therefore be told to do the most simple and commonsense things? While the noble Lords are about it, as well as proposing that the Minister in limiting the period should, have regard to the capital expenditure involved, why not say also that he should have regard to the labour available or the materials available, or that he should have regard to the steel situation? Of course, the answer is that the Minister will have regard to all those things, and it is not necessary specifically to draw his attention to them.
With regard to the point raised by the noble Lord, Lord Clydesmuir, I am sorry that if what was said in the course of proceedings in another place led the noble Lord and his friends to expect that there was going to be some concession on this point. I gather that perhaps that was so, but I am not responsible for it. If the noble Lord thinks that, arising out of the discussion in another place, he will be able to find an alternative form of words, I have no control over the further Amendments put down on Report stage, and it is for noble Lords to act accordingly.
LORD ROCHDALE: The noble Lord, Lord Morrison, has just said, apropos of this Amendment, that it is obvious that any Minister would take account of the time concerned. May it not also be that an enthusiastic Minister will consider that a case put up by somebody who wants to establish a plant in such an obvious

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case that, a renewal of the licence is bound to be granted for some subsequent period, regardless of the fact that he may not be the Minister when the time comes for the licence to be renewed? If we insert this into the Bill now, however certain the Minister may be that the licence will be renewed in five or ten years' time—or in twenty years' time, the reasonable life of some plant—he will be bound to put it in the licence and the individual who holds the licence will be safeguarded in any enterprise that he may take up.
LORD BALFOUR OF INCHRYE: The noble Lord accepted an Amendment a few minutes ago and now refuses this one; we are all square. In asking that this Amendment may be withdrawn, I hope that I shall have another victory.
Amendment, by leave, withdrawn.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE had given Notice of an Amendment to omit paragraph (c) of subsection (2) and of a further Amendment to omit all words in paragraph (c) down to "conferring." The noble Lord said: I will not move the first of these two Amendments.
LORD MORRISON: It would be for my convenience if the noble Lord would move it.
LORD BALFOUR OF INCHRYE: If it be for the convenience of the Committee, I will do so. We take a strong line on the second Amendment, but not on the first. The first Amendment has the effect of deleting paragraph (c); the second has the effect of making paragraph (c) read
"conferring on the Corporation an option to purchase any such products;"
We do not like the restrictions on licences, and we have given prolonged consideration to this problem. I think there is a case for conceding to the Corporation an option to acquire products produced under a licence given under this clause. Indeed, licences granted under Clause 30(4) give the Corporation the right to acquire products. If this is given in one case, logically we ought to give it in the other. There seems no good reason why the Minister should seek to impose restrictions on the disposal of an undertaker's output. It is difficult to think what is the motive for
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having power to impose such restrictions, except that it is feared that a public company may be harassed by the healthy competition of outside firms. A similar Amendment was put down in another place, and the Minister then made the point that in times of shortage he must have this power in order to direct supplies where he felt they were most needed. We do not accept that. We say that in an emergency or shortage the direction of supplies can be done by an emergency measure of a temporary character. As the clause stands, the Minister, if he were so inclined, could direct output of new undertakings or existing undertakings in excess of the normal permitted level at any time, whether in time of shortage or of abundance. We feel that it is basically a wrong power to give the Minister. It is a matter of principle to us that the Minister should not be given this power. I do not think there is any need to deploy the arguments further; I have tried to paint the broad picture.
Amendment moved—
Page 37, line 15, leave out from ("on") to end of line 19.—(Lord Balfour of Inchrye.)
LORD MORRISON: If the noble Lord is not satisfied with my reply perhaps he will take part afterwards, but the nature of my reply will probably not be altogether unsatisfactory to noble Lords opposite. There are two Amendments. The first is to leave out from "on" in line 15 to the end of line 19, which in effect leaves out paragraph (c). The second Amendment modifies this a little and proposes to leave out the words:
"imposing restrictions as to the persons to whom the products of those activities may be sold, and in particular for…."
I think I am about due to heap coals of fire upon the noble Lord's head. The noble Lord said that we were all square. I take the opportunity of getting ahead by saying that I am prepared to accept the first Amendment deleting paragraph (c). He will see that by doing so the second Amendment will not arise. I have no doubt that will be acceptable.
LORD BALFOUR OF INCHRYE: I am embarrassed. I think the noble Lord has made a bogey. I gratefully accept the offer of the noble Lord, which exceeded my hopes.
On Question, Amendment agreed to.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved in subsection (2) to leave out "and before issuing a licence under this section, the Minister shall consult with the Corporation." The noble Lord said: The purpose of this Amendment is to delete the provision that the Minister must consult with the Corporation before issuing a supplementary licence for an existing undertaking. The Corporation is the very body which will be interested in preventing the entry of new undertakings into the industry and will naturally look with suspicion on the expansion of existing small businesses. To require the Minister to consult only the Corporation seems to us further to weigh the scales against prospective new entrants or expanding firms, since the Minister's decision must be to some extent coloured by the views of the Corporation. In any event, it seems to us that the consumers are in the best position to give a reliable view of whether there is likely to be a market for the output which small and specialised undertakings would be likely to produce. The Minister would consult the Corporation as a matter of course, and it does not seem necessary to write this into the Bill. The noble Lord has just used the argument that as the Minister would obviously do something, it was not necessary to write it into the Bill. I would use the same argument to him in this case. It merely emphasises the restrictive character of this clause and the slight chance that the little man will have against the great State octopus. The score is going well, and in moving this Amendment I hope I shall score another victory.
Amendment moved—
Page 37, line 20, leave out from the beginning to end of line 21.—(Lord Balfour of Inchrye.)
LORD STRABOLGI: Frankly, I was amazed at the generosity of my noble friend in accepting the last two Amendments. In fact, the noble Lord opposite had moved only one of them. I am astonished, disappointed and hurt that the noble Lord, Lord Balfour, has responded by moving this Amendment, which I suggest is altogether unnecessary. If he had put into the wording of his Amendment, "and the Consumers' Council," of which he gave some hint in his speech, I could have understood it. But even that would have been rather too much.
LORD BALFOUR OF INCHRYE: May I interrupt the noble Lord? If he looks at the next Amendment he will see that it comes in there.
Lotto STRABOLGI: Is that being moved too? I understood that this was the end. However, the noble Lord himself admitted that the Minister, in the ordinary course of events, would consult the Corporation. Presumably, the Corporation would attract to themselves many of the greatest experts in iron and steel from all over the world. We made an attempt to get the greatest expert in iron and steel in the word when we tried to secure Dr. Van der Byle, whose death has been such a great loss to the industry and to the Commonwealth. I am sure the Corporation will attract to themselves the greatest brains in the industry. I am not without hope that the noble Earl, Lord Dudley, will perhaps give advice in some capacity.
VISCOUNT SWINTON: While the noble Lord is speaking on that very eminent man whose death we all regret so much, it would be of great interest to the Committee if he were able to tell us what his views were about the nationalisation of iron and steel.
LORD STRABOLGI: I happen to know them, but I do not propose to refer to them. Of course, the Minister will consult the Corporation. In that case, why not have it put into the Bill? I suggest that this Amendment is unnecessary, and I hope May noble friend will resist it.
LORD MORRISON: I have been too long in politics to expect any gratitude, and when I unexpectedly tried to overwhelm the noble Lord with my magnanimity a few moments ago I did not expect that he would declare his innings closed, if I may use a cricketing expression. The noble Lord has moved this Amendment, and I can say quite briefly that I am unable to accept it. As he knows well, the general purpose of this Bill is that the Corporation are given a virtual monopoly over the Second Schedule products, and in the enjoyment of this monopoly they are subject to the duties laid down in Clause 3. A licence to private enterprise to encroach upon the monopoly would make the discharge of the duties a matter of increased difficulty. It therefore seems to me right

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and proper, before the Minister allows such an encroachment, that he should ask for the views of the Corporation, and give such weight to those views as he may think desirable. The Bill does not say that the Minister shall necessarily accept the views of the Corporation, but I think it is only common sense that, having appointed a very important body to carry out an important task, before issuing a licence under this clause he should, at least, consult them.
VISCOUNT SWINTON: I did not altogether expect the noble Lord to accept this Amendment. As he truly said, whether the words are there or not the Minister could consult with the Corporation. But the noble Lord has said one rather odd thing which I should like to emphasise. He said that the Corporation are going to have a virtual monopoly of the Second Schedule products. That is true. He also said that under Clause 3 we have imposed upon the Corporation the duty to produce all the steel that is required, at a reasonable price, and in the quantities which the consumer needs. The noble Lord then went on to say a most extraordinary thing—namely, that if anybody else is allowed to come into this business and produce some of these Second Schedule products it is going to make it much more difficult for the Corporation to discharge their duties. I really cannot understand that.
The noble Viscount the Leader of the House on the Second Reading of the Bill said that one of the troubles was that there never seemed to be enough steel—all sorts of things were held up for steel. Surely, the more people there are producing Second Schedule products, the more steel there is likely to be. I really cannot understand how the Corporation are going to be handicapped in their capacity to produce steel, and how the country is going to be handicapped, if there are a few more people in the business producing a little more steel. That seems to me to be a curious non sequitur. If he meant that the monopoly did not want any more competition than it could avoid, then I quite understand the argument. That is an argument which we are, alas, getting increasingly accustomed to as monopoly follows monopoly.
THE EARL OF DUDLEY: I am rather disappointed that the noble Lord oppo-
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site has not accepted this Amendment, because it is, as he said, only common sense that the Minister will consult the Corporation in any case, and nothing we put in this Bill will prevent him from doing so. But the conditions of this clause, certainly until a few moments ago when the other Amendments were accepted, were most restrictive. Ten minutes or a quarter of an hour ago the Minister was going to say to a poor little man who was brave enough to pit his wits against this great octopus, the monopoly: "I will consider granting you a licence, but I do not know for how long it will be. It will be for quite a restricted period. I shall want to know what capital you are going to put into it. I shall have to limit the extent of your activities in all sorts of ways. I shall have to impose all sorts of conditions. I shall not allow you to sell your product to anybody except the persons to whom I say you may sell them, and I shall be your chief customer at a price which I shall determine." All those restrictions were included. He was also going to say: "I will consult with your chief rival, the Corporation"—this great octopus—"before you can be allowed to come into the circle at all."
It was the unnecessary emphasis on the restrictions of this clause to which we objected. I think it is rather foolish, if I may say so, for the Government not to accept this Amendment, because if they leave out these words it does emphasise their good will towards the small men whom they want to encourage and ought to encourage to a greater extent than they do at present. I hope the noble Lord will consider this point before the next stage of the Bill.
LORD MORRISON: I am sorry, but I cannot alter my decision. We have agreed that a licence shall be granted, and the Amendment is simply to leave out the words:
"and before issuing a licence under this section, the Minister shall consult with the Corporation."
I have explained why we feel that these words should be retained. I do not think anybody is really opposed to them. Lord Strabolgi, who is an old political friend of mine, may well have made a speech just now because he was so taken back with the concessions I made a few moments ago that he had an extra speech in reserve. I doubt very much whether

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he is opposed to these words being in the Bill. In any case, I am sorry, but I cannot accept the Amendment.
LORD BALFOUR OF INCHRYE: I am sorry that the Minister feels unable to accept this Amendment. It is not one for which we would go to the stake and, therefore, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
6.40 p.m.
VISCOUNT FALMOUTH VISCOUNT FALMOUTH moved, after subsection (2) to insert:
"( ) A licence shall not be refused under the last foregoing subsection unless before refusing the same the Minister has satisfied himself after a consultation with the Iron and Steel Consumers' Council that it is in the public interest that such licence shall be refused"
The noble Viscount said: This Amendment deals largely with the consumers of steel. I am extremely fortunate that the noble Lord, Lord Morrison, is dealing with this particular question, because he was recently a distinguished member of the Metropolitan Water Board. That particular Board uses every conceivable type of steel, in every conceivable shape and form. I would like to ask the noble Lord this question. Suppose the Board decide to have a particular type of stainless steel for one of its valves, and the engineer applies to a firm and asks them to make it. That firm will say: "We are sorry, but we cannot get a licence to make that steel." The reply is "Why?", and the firm will reply, The Minister thinks they ought to be made in bronze," or something like that. Surely there should be some right of appeal to the Consumers' Council in order to state a case.
I imagine that that is the purpose for which the Consumers' Council is set up. If that is refused, the consumers will have a very real grievance in not being able to place before the Council the restraints which are put upon them for the obtaining of various classes of steel which are essential for the purposes for which they require them. The same arguments apply to the small steel maker, who is requested to make this article. He in his turn is entirely dependent upon the engineering industry, and it is on behalf of the engineering industry that I ask the
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Government to accept this Amendment, which is surely entirely in accord with the purposes for which the Council was set up. I beg to move.
Amendment moved—
Page 37, line 21, at end insert the said subsection.—(Viscount Falmouth.)
LORD MORRISON: I thank the noble Lord for his kindly references about the time we spent together in the Metropolitan Water Board. I am glad I am not there now in these difficult days of drought. I am sorry that I cannot respond by accepting this Amendment. The Government feel that it is not necessary to have a statutory provision in order to ensure that the consumers' interests are taken into account. That would be done in any case through the machinery of Clause 6. They would be known not only to the Corporation but to the Minister himself under the provisions for keeping him informed of the Consumers' Council proceedings. Perhaps I should add that it will of course be open to the Minister at any time to seek the views of the Consumers' Council on particular matters. It will also be open to other interests wishing to provide new or additional production to represent their point of view to the Consumers' Council or its, committees, with the object of securing support for new manufacturing projects.
VISCOUNT SWINTON: The noble-Lord says that this will be dealt with under Clause 6, which is the clause setting up the Consumers' Council. Do I understand from that that somebody who is applying for a licence will be entitled, under Clause 6, to go to the Consumers' Council and say: "Will you give me a recommendation for this to the Minister?"
LORD MORRISON: That is almost exactly what I said. I said that it would also be open to other interests wishing to, provide new or additional production, to represent their point of view to the Consumers' Council or its committees, with the object of securing support for new manufacturing projects. With that explanation I hope the noble Lord will withdraw his Amendment.
LORD BALFOUR OF INCHRYE: The noble Lord said that it was not necessary to have a statutory provision, but it seems to me rather one-sided that

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it is necessary to have a statutory provision that the Corporation be consulted in the granting of a new licence while, on the other hand, it is not considered right that there should be a statutory provision that the Consumers' Council should be consulted when a licence is to be refused. It does not seem to me to be logical. But at any rate, from what the noble Lord said I think we are on common ground: that the Consumers' Council have a position in this, in that they can represent the users and potential users. It seems to me a clumsy piece of administration that someone who wishes to start or expand an enterprise, goes to the Consumers' Council and, as it were, secures an endorsement of his proposals and then goes to the Minister. Nevertheless, it achieves the purposes of the Amendment. We have the position now where, in the procedure outlined by the noble Lord, the Consumers' Council can give a view as to whether a licence should or should not be granted. That is the purpose of the Amendment, and I should recommend my noble friend to withdraw the Amendment in view of the explanation of the Minister who says that the object will be achieved, although in a difficult and more clumsy way.
VISCOUNT RIDLEY: Is it absolutely certain that any intending producer could get his case referred to the Consumers' Council? Under the part of the Bill which deals with the Consumers' Council, they have to deal with matters referred to them by consumers. They have no specifically expressed contacts with any producer or intending producer. I suppose it would mean that a consumer will have to go to the Council and make out a case for being short of some particular product, or range of products, and then after that it will have to be referred to a possible producer. It seems to me that there is some doubt as to whether, in every case, such a matter would inevitably come before the Council.
LORD STRABOLGI: There is another consideration which I think is important, following the observations which fell from my noble friend Lord Morrison. I think that the little man referred to by the noble Earl, Lord Dudley—the poor little fellow who is going to start this vast steel works, with all the risks attaching thereto—will also be entitled to go to the Corporation
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and put his case before them. I think that is only fair. If the Minister is to consult the Corporation, I suggest that this poor little fellow should also have the right to go to the Corporation.
LORD MORRISON: I do not think I need add any more. I have already said twice that it would be so, and my words may be read to-morrow in the OFFICIAL REPORT.
VISCOUNT FALMOUTH: In view of the assurance given by the noble Lord, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD HAWKE LORD HAWKE moved to add to the clause:
"( ) If an undertaking has been or is given by or on behalf of the Minister that a licence will be issued under this section when certain works have been completed or certain expenditure has been incurred, the licence shall be issued in accordance with the undertaking when the works have been completed or the expenditure incurred."
The noble Lord said: I believe that I am going to achieve two objects in moving this Amendment. First of all, I may get His Majesty's Government to accept it and, secondly, I hope to obtain the answer to the problem which has always puzzled me: Which came first, the chicken or the egg? The reason for this Amendment is that, after the passing of this Bill, there may be people who want to enter the field of Second Schedule activities. They may well not have a works with which to do it. The Minister can license a person to enter Second Schedule activities, but can he license a person who does not have the works? Which comes first, the works or the licence? We seek to provide in the Bill that where the Minister gives the entrant some form of assurance that he will eventually receive a licence, he will in fact get that licence, in spite of the fact that the Minister may have changed in the interval and the economic situation may be very different from what it was when the application was made. With those remarks I beg to move.
Amendment moved—
Page 38, line 3, at end insert the said subsection.—(Lord Hawke.)
THE EARL OF BUCKINGHAMSHIRE: Since any time up to two years may elapse between now and the vesting date, a company not so engaged can embark

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on Second Schedule activities should the Minister choose to sanction it. The noble Lord, Lord Hawke, said that the Minister could give an assurance that he will issue that licence when the time comes. We want to make sure that that licence is issued whatever happens. We ask also: Why omit this provision unless there is to be no new undertaking of Second Schedule activities? I would ask the Government whether it is a pure mistake or whether the Minister does not intend to sanction Second Schedule activities until after the vesting date.
LORD MORRISON: As this is the last Amendment before the time when we shall adjourn, I had hoped to be able to finish up triumphantly, but that does not always happen. I think I can give the noble Lord a reasonable assurance on his Amendment. I start by saying that I cannot find any disagreement with its principle. The only reason I am unable to accept it is that it is unnecessary. Capital expenditure for a purpose requiring licence would obviously not be undertaken without first obtaining an undertaking from the Minister that a licence would be issued. So far we agree. I am perfectly sure that the noble Lord does not suggest that an undertaking once given by a Minister would not be honoured. If that is his suggestion, and I cannot believe it is, I will sit down, because have no more to say. He raises the point: Which comes first, the works or the licence? In reply to that, I see no administrative difficulty in issuing the licence in advance of the construction of the works, with an appropriate condition attached to it to the effect that it would come into effect on the completion of the works. I have no doubt that that is an administrative method which could easily be adopted, and I think will be adopted. On that assurance I think the noble Lord will feel that his point has been met.
LORD HAWKE: I think the noble Lord has met me entirely if in fact the entrant can obtain a licence notwithstanding the fact that he has not yet got the works. The point we seek to secure is there. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 29, as amended, agreed to.
[The Sitting was suspended at five minutes before seven o'clock and was resumed at a quarter past eight.]
Clause 30:
Rights of existing businesses.
(3) Subject to the next following subsection, a licence which the Minister is required by this section to issue shall not be subject to any conditions except the following, that is to say:
(a) a condition limiting the extent of any such activity to the annual production of—

(i) double the average annual output during the years nineteen hundred and forty-six and nineteen hundred and forty-seven of the works aforesaid used for carrying on that activity, or

(ii) the quantity specified in the second column of the Second Schedule to this Act in relation to that activity,

whichever is the less; and
(4) Where the Minister is required by this section to issue a licence to a person in whose case the average annual output during the years nineteen hundred and forty-six and nineteen hundred and forty-seven of the works used for carrying on any such activity of the business at the passing of this Act was greater than the quantity specified in the second column of the Second Schedule to this Act in relation to that activity, the licence shall, instead of being subject to the condition specified in paragraph (a) of the last preceding subsection, be subject to a condition limiting the extent of the production of that activity to the average annual output of the works during those years; and the licence shall be subject also to a condition that the Corporation may require the holder of the licence to tell to them so much of the output to which the licence relates as the holder of the licence does not require for purposes of manufacture in the works of the holder of the licence, at such price as may be agreed, or, in default of such agreement, as may be determined by arbitration having regard to the prices at which similar products are sold in the open market by the Corporation or publicly-owned companies.
LORD TEYNHAM LORD TEYNHAM moved, in subsection (1) after "Minister" (where that word occurs a second time) to insert:
"or, in a case where a question is referred to arbitration under subsection (5) of this section within three months after the determination of that question."
The noble Lord said: It may be for the Committee's convenience if I suggest that this Amendment and two other Amendments to page 39, line 35, and page 39, line 38, which are consequential, should be taken together. These are little more than drafting Amendments. The clause, as drafted, provides that the Minister shall issue a licence to an existing business within six months after the date of the receipt by the Minister of certain

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particulars which are set out in subsection (2). These particulars may in some cases be disputed by the Minister, and subsection (5) provides for arbitration. It may happen that the arbitration may not be determined until after six months have elapsed. This Amendment provides for the issue of a licence within three months after arbitration has been determined. I beg to move.
Amendment moved—
Page 38, line 11, after ("Minister") insert the said words.—(Lord Teynham.)
THE FIRST LORD OF THE ADMIRALTY (VISCOUNT HALL): I entirely agree with the noble Lord, Lord Teynham, that these three Amendments hang together; and in view of the very friendly relationship which has been established to-day I am almost inclined to do a deal with him, that we should go fifty-fifty on this clause: I will accept 50 per cent. of his Amendments if he will withdraw 50 per cent. I am quite prepared to accept not only this Amendment but the other two to which he referred. If he will formally move them when we reach them they will be accepted.
LORD TEYNHAM: I am grateful to the noble Viscount for accepting this Amendment.
On Question, Amendment agreed to.
THE EARL OF DUDLEY THE EARL OF DUDLEY moved, in subsection (3)(a) to omit all words after "double the" (in sub-paragraph (i)) down to the last word "and" and to insert in their place:
"quantity specified in the second column of the Second Schedule to this Act in relation to that activity."
The noble Earl said: This Amendment was to have been moved by the noble Lord, Lord Clydesmuir, but unfortunately he is detained elsewhere. In asking for your Lordships' indulgence, I am fortified by the thought that the noble Viscount, Lord Swinton, who will follow me later, with his unusual and rapid grasp of an almost unlimited range of affairs will fill in the gaps that I shall leave.
Clause 30, which incidentally was not discussed at all in another place, provides that existing undertakings not being taken over under the Second Schedule shall be entitled to licences as of right to produce
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either double their average output in the years 1946 and 1947, or 20,000 tons a year (or 50,000 tons in the case of iron ore) whichever is the less. The proportion of output of Second Schedule products produced in 1946 and 1947 by firms which under this Bill will be licensed, or free, is less than 10 per cent. of the whole, except in the case of light sections and bars, hoop and strip, tinplate and alloy steel, which exceed the 10 per cent. by varying small amounts. It is unlikely that these tonnage proportions are going to jeopardise in any way the nationalised portion of the industry, and therefore we find it difficult to see that these restrictions are necessary.
These little men who are going to be left free and will be licensed fulfil a most important function. They are the hucksters of the industry. They roll all kinds of special qualities and ranges which the larger firm, with its continuance of rolling output, cannot do without considerable expense. As we have recognised all through the centuries, their initiative and enterprise are of inestimable value to the consumers, and particularly to the precision engineers, the export of whose product is of such vital importance to us at this moment. Some of these firms may have an output of, say, 18,000 tons. That means that under the present clause they cannot exceed a maximum of 20,000 tons, and it follows that they will be hopelessly restricted. They dare not proceed with development schemes, because a modernisation scheme would entail probably an increase in output of 2,000 tons, which would bring them up above the 20,000 ton mark, when they would no longer be free.
As noble Lords probably know, it really is impossible to modernise without increasing your output in some way. I am sure that the Government do not in any way wish to discourage the modernisation even of these small firms. It is just as important that they should be modernised as that the larger firms should be. Now, under this clause, you are directly discouraging modernisation. Through modernisation, these small people have increased their output very considerably in recent years. Let us see what they have done during the last decade, between 1938 and 1948. During that period, the ingot tonnage which the Government will control, if this Bill

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passes, was increased by 45½ per cent., a very considerable figure. But, during the same decade, the output of these small firms to which I am referring was increased by 66 per cent. So noble Lords will see clearly that, if these small firms are to remain up-to-date, it will be impossible for them in the future to avoid some increase in output, which will put them at the level at which they will be claimed by the caucus of nationalisation. They will be greatly handicapped if they are restricted in this way, because, as noble Lords who have been in any productive business know perfectly well, it is on the last few tonnages that you get the profit. It is at the top of the tonnages where the profits are made. To get down to brass tacks, if the Bill passes the Government are going to control 99 per cent. of the ingot production and at least 92 per cent. of the finished products in an industry which, by the time they take over—if they ever do take over—will be producing something like 1'1,500,000 tons a year. This little tuppeny-ha'penny, though frightfully important, output—I say "tuppenyha'penny" not in any derogatory way, because this small output is vitally important to the consuming interests of Great Britain—this increase of 20,000 tons to 40,000 tons is not really going to make any difference to, or embarrass in any way, the nationalised part of the industry. It so happens that at least one firm in my knowledge in present circumstances have not been able to go ahead with development schemes. They have not gone ahead with them because, if they did, it would bring them over the 20,000 tons mark and they would be seized under the Second Schedule. That is a very undesirable thing, and the Government must grant more leeway in this respect.
The Minister was fairly encouraging in another place when on Second Reading he said:
"Critics suggest that it is undesirable for a publicly-owned company to be in competition with a privately-owned company. On the contrary, this is likely to be highly beneficial, in that both the publicly-owned and the privately-owned companies will be subjected to the competition of each other."
That is very desirable, and we agree with it. Then he said:
"We do not wish firms not taken over to be in any way handicapped in their ordinary activities, or even in extending their capacity
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within reasonable limits.… We want all firms in the iron and steel industry, outside the nationalised sector industry, outside the nationalized sector, to have every opportunity to prosper. The only restriction placed upon them is that they may not extend their production to such a degree as to make the intergrated working and efficiency of the major publicly- owned sector impossible."
It is difficult to say how an output of 40,000 tons per annum is going to exceed what the Minister envisages. Noble Lords opposite are sensible people, and I am sure they want to make this Bill workable—although that will be very difficult, if not impossible, unless they accept some further elasticity. In this respect the Bill will be an exceedingly bad one, and they will be cutting off their nose to spite their face. I beg to move.
Amendment moved—
Page 38, line 46, leave out from the first ("the") to ("and") in line 6, on page 39, and insert the said new words.—(The Earl of Dudley.)
VISCOUNT HALL: We always heed the words of the expert who can put his case in such a pleasing manner as can the noble Earl, Lord Dudley. As we know, he has taken an active part in iron and steel production during his lifetime. He is not concerned only about the big combine but, as he has indicated in his speech, he is equally concerned about the small man. I fully agree with what he has said, that the small man with the small business, with initiative and enterprise, is a very important branch of this or any other industry. I think the Amendment goes a little further than the noble Earl intended. It must be remembered that in the clause which it is proposed to amend, if the little man is licensed, not only can he double his output if the output does not exceed the amount stated in the Second Schedule, but he is encouraged to continue that initiative and enterprise which we all expect of him. I cannot quite understand the position in regard to the firm which had an output bordering on, say, the 20,000 ton limit—as to why they did not go on with their development. If they had consulted the Minister of Supply, or the Ministry of Supply, I think they would have been given every encouragement to do so. I can understand that there may be a feeling that the present ceiling is unfair, in that it does not allow a reasonable margin for

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expansion to firms whose production is near the permitted maximum.
It is recognised that the maximum could not be rigidly imposed in certain borderline cases. It is unreal, however, to suggest that every licensee, and in particular that the very small producers (and it must be remembered that there are about 80 of these small producing firms who are producing under 5,000 tons) would ever consider expanding to 40,000 tons. It has never been anticipated that they would ever consider expanding to that extent. We must assume that if the Amendment were accepted each licence would be fully exploited, and the potential total effect of the proposal must be considered. Where the maximum output under the existing formula would be 50,000 tons of iron ore, the Opposition's Amendment would make it 100,000 tons. The present maximum in the Bill is based on the principle of nationalisation and the creation under the Corporation of a monopoly in iron and steel, and no Government in those circumstances can contemplate the acceptance of a potential production on such a scale as would be given if, as this Amendment suggests, that is outside the control of the Corporation and without any reference to plans for the industry as a whole. For these reasons I regret that the Amendment cannot possibly be accepted.
My right honourable friend, speaking in Committee in another place, said how illogical was the Amendment proposed there to allow any newcomer in the industry to produce at least 40,000 tons a year, when companies producing not less than 20,000 tons a year are being acquired with the declared object of making them part of an integrated industry. The present Amendment now before this Committee is, I think, a little illogical. It is not the Minister's intention that every existing producer shall be rigidly restricted to the output permitted under the present subsection (3)(a). I would like to refer to the assurance which the Minister gave in the following words:
"… If there is any firm in that higher bracket making between 15,000 tons and 20,000 tons which can show good technical grounds for expansion to a reasonable extent—not up to 100,000 tons—and can show that it would be more economic if it did, or that
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its capacity is needed in the industry. I should almost automatically give permission for that firm to expand reasonably over the 20,000 tons limit."
As I have said, His Majesty's Government cannot accept this Amendment, and I think I might mention now that they cannot accept the later Amendment to subsection (4) which I think is really consequential upon it. Perhaps I may indicate now the Government's intentions concerning the licensing of certain exceptional cases which the Minister proposes. Under Clause 30, as drafted, existing businesses whose average production in 1946–47 was less than 50,000 tons of iron ore or 20,000 tons of other Second Schedule products will be entitled to produce up to those levels or double their 1946–47 average, whichever is the less. Producers whose 1946–47 average output was over 50,000 tons or 20,000 tons, as the case may be, will be licensed Ito produce up to their 1946–47 average.
The Minister recognises, however, that there are a number of producers remaining in private ownership whose output since the end of 1947 has gone beyond the maximum to which their licence would entitle them under Clause 30 as drafted, or who have, with the approval of his Department, undertaken works of development which, when completed, would involve an output greater than that maximum. The Minister has always intended to provide specially for these cases, and to make his intention in this matter quite clear he has authorised me to give an undertaking in the following terms. Where a producer who is entitled to a licence under Clause 30 has an output in any calendar year between January 1, 1948, and the date of the licence which is higher than that to which Clause 30 entitles him, he will be licensed at that higher figure. Where approved capital development is in hand, the licensed output will conform to the planned production as approved by the Minister of Supply. I think that in this undertaking which the Minister has authorised me to give he has gone some distance to meet noble Lords opposite, and I hope in the light of that undertaking the noble Lord will withdraw his Amendment. If there is any question or any matter which they would like to discuss in relation to this undertaking, I should be prepared to meet the noble Viscount, Lord Swinton, or any of his

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colleagues, for further discussion of the matter.
VISCOUNT SWINTON: I am indeed grateful to the noble Viscount, the First Lord, for meeting us on this matter in a spirit of sweet reasonableness, partly natural to himself and partly induced by the admirable advocacy of my noble friend, the Earl of Dudley, who has shown that heredity can justify both a seat in this House and the direction of a great family concern. What the First Lord has said goes a good way to meet us. We have passed the stage of principles on which we shall never agree, until noble Lords opposite are converted to a more reasonable frame of mind, but we now want to get everything that will make this Bill as workable as possible. We want latitude, but at the same time I am bound to agree with the First Lord that the Amendment, as it stands, while designed to give latitude, would also lead in a year or two, if all the producers were to get their 40,000 tons of Second Schedule products, to their falling into the voracious maw of the Government. On the other hand, it is common ground that we want reasonable expansion and we want people who are excluded to have a reasonable deal.
It is true of almost every industry of the country that it is when they are working to full capacity that they make a profit. If they carry on at 60 or 70 per cent. output, they make a loss. I think that is particularly true of the smaller businesses, doing the rather meticulous work—making the bits and pieces which are so necessary. If you are running full time, that makes all the difference between a profit and a loss. Works are not designed to fall into exact mathematical categories of under 20,000 or over 20,000. Therefore, what we on both sides want to achieve is reasonable latitude to these firms. We are dealing here not with the people who come new into the business, and are suppliants for licences, but with people who are left out of the Bill and are entitled to licences as of right. We want to enable them not only to carry on the business at a profit—that may be only a secondary consideration—but to make that contribution which even the Government, by leaving them out, admit they can and ought to make to the national productive effort.
What the noble Lord proposes is this. We start off, after all, with an artificial
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date—well, we must start somewhere. As I read it, this clause starts with January 1, 1946. You then say: "If in the years 1946 and 1947"—and you take the average of the two—"you come up to a certain point, you may have the advantage of the average of those years." The noble Lord says he appreciates that we still want these people who are left out of the Bill to produce the maximum of their capacity. Therefore, he says, if I followed him aright, if any firm has an output in any year between January, 1948, and the time of licensing which is higher than he would get under Clause 30 as it stands, which is the average for 1946–47, he shall be entitled to the higher figure. I do not think that an unreasonable proposition in principle, and I say at once that I 'would accept it.
What I think the noble Lord will agree is that, having accepted that, we want to find the fairest possible date. There has been a great demand, and these people have been urged to produce as much as they can; and I imagine that the expansion has continued on a fairly steady rising curve. It may, be that a firm has a relatively low figure for 1946. The noble Lord will not accuse me of introducing a political element into this debate if I say that 1946 was a difficult year. There was the business of the coal; do not let us argue about it; we were all short of coal and, therefore, we could not get on with the production. On the other hand, in 1947, people began to get into their stride, and the curve begins to rise. Therefore I do not think it is fair to take the average for the 'two years. If the firm could show that the output in any year between January 1, 1946, and the time of the transfer was higher, I think it would be reasonable and entirely consistent with what the noble Lord said, that they should automatically be licensed for the higher figure. There is no difference in principle between us; the difficulty is to agree on what is the reasonable date on the mathematical curve.
The noble Lord well on to say—and I think this is entirely right—that where approved capital development has been undertaken, the licensed output should be in conformity with the planned production as approved by the Minister—I think I caught the noble Lord's words. I think that is also quite fair, and subject to the adjustment, upon which I do not think we need have much difficulty—1948 is

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perhaps not a fair date to put in: I think it should be 1947 or 1946—I think we could reach a reasonable compromise on this. I have only one other thing to ask, and it is this. The noble Lord said that that is the way in which the Minister wants to do it, but I think we should have this in the Bill. I am not going into any of the old arguments as to whether or not we ought to trust the Minister to do things. The noble Viscount the Leader of the House, the right honourable gentleman Mr. Herbert Morrison and everybody have always said frankly: "If we give an undertaking here it binds us, but it does not bind another Parliament." We gave some undertakings together in the National Government to which noble Lords opposite did not pay regard—I am not going to argue whether they were right or wrong.
THE LORD PRIVY SEAL (VISCOUNT ADDISON): I was not in the Government.
VISCOUNT SWINTON: But you were an elder statesman outside.
VISCOUNT ADDISON: I am exceedingly interested in this, but I was not a member. My colleague, Mr. Morrison, was.
VISCOUNT SWINTON: But the noble Viscount does not dissent from the proposition I have advanced—of which he is at present taking advantage—that those undertakings which were given by the National Government no longer remained binding when, unfortunately for the country and everybody, we parted. I do not base it only upon that. The Government have laid down in this clause—and quite rightly—in very detailed terms exactly how the average is to be worked out, and upon what basis the licence is to be given. I think the First Lord of the Admiralty will agree that we ought to put in the clause—in whatever are the appropriate words—the undertaking which he has now offered to the House and which, subject to the slight adjustment which I propose—and which I do not think he will regard as unreasonable—I am inclined to advise my noble friends to accept.
VISCOUNT HALL: I am grateful to the noble Viscount for the way in which he has approached this declaration by
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the Minister. I can assure him that the date is not a fixed date, in the sense of negotiating that matter. With regard to the second point, he rightly described the latter part of the announcement. With regard to embodying that in legislation, that is an offer which we will discuss, and I do not think we shall find the slightest difficulty.
THE EARL OF DUDLEY: Although I have not the whole slice of the cake that I asked for, I am grateful indeed for that part which the Government has conceded to me. I ask the Committee for leave to withdraw the Amendment on the understanding that the final details will be worked out by the Front Bench and the noble Viscount.
VISCOUNT SWINTON: And you.
THE EARL OF DUDLEY: With those remarks I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
THE EARL OF DUDLEY THE EARL OF DUDLEY moved in subsection (4) to omit "to the average annual output of the works during those years," and to insert:
"to such an annual output (not being less than the quantity specified in paragraph (a) of the last preceding subsection or the average annual output of the works during the said years, whichever is the greater) as the Minister thinks reasonable in relation to the activities of that company."
The noble Earl said: I hope the Government will see that this Amendment hangs in some way on the last Amendment, and the people for whom I plead now have very much the same claim as the people for whom I have just been pleading on the previous Amendment. This Amendment seeks to provide appropriate tonnage limitation formula for companies eligible for licences who produced more than 20,000 tons in the year 1946–47. This subsection (and I think the terms of the Amendment will be familiar to many of your Lordships, particularly those who have been used to reading the City columns of the newspapers, because the firms to whom I will refer presently have been excluded one by one from the Second Schedule and have received a certain amount of publicity) applies to those firms who, although they produced more than 20,000 tons a year on an average in 1946–47, are nevertheless excluded from

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public ownership by virtue of the operation of the proviso to Clause 11, subsection (3) which reads:
"Provided that the Third Schedule does not include any company whose main activity on the said day consisted of the manufacture of motor vehicles or any company in whose case—

(i) the average annual output during the said years of the products of each of the said activities carried on by the company on the said day, being the output of works operated by the company on the said day, was less than fifty thousand tons; and

{ii) the total number of persons employed by the company on the said day wholly or mainly for the purposes of the said activities was not more than fifteen per cent. of the total number of persons employed by the company on that day."

This proviso, as it was when the Bill was first introduced, originally excluded from public-ownership only the Ford Motor Company, which produced an average of 172,000 tons a year of pig iron in 1946–47. But on the Report stage in another place the Minister widened the terms of the clause to exclude from public-ownership also five firms whose annual output of schedule products in the year 1946–47 averaged less than 50,000 tons and not more than 15 per cent. of whose labour was engaged in scheduled activities. Those firms were Bayliss, Jones and Bayliss, Limited (your Lordships will have heard about them) with an output of 37,100 tons of hot rolled products; the Carron Company, with an output of 37,200 tons of pig iron; the Clay Cross Company, with an output of 26,700 tons of iron ore and 41,600 tons of pig iron; Richard Johnson and Nephew, Limited, with an output of 41,100 tons of hot rolled products; and the Executors of James Mills, Limited, with an output of 31,000 tons of hot rolled products. All those companies will be eligible for a licence as of right, and they should not be subject to conditions less favourable than those applicable to their competitors whose output was less than 20,000 tons a year in the base years—the people we have been talking about in the last Amendment. The last preceding Amendment will now, thanks to the Government, allow those concerns a reasonable margin for expansion.
These other companies to which I now refer should surely enjoy privileges on the same scale. The output of these excluded companies cannot reasonably be limited to their average 1946 and 1947
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output, since this would not allow any margin for expansion as of right. Because of the lack of appropriate tonnage relationship between Ford's and the other companies now covered by this clause, and because of the special circumstances of Richard Johnson and Nephew, it is impracticable to devise a specific formula fixing a limit fitting for each of the six companies concerned. Under this Amendment it is considered that the best course is to allow the Minister to fix limits himself for each of the companies, provided that none of the companies is obliged to operate below the 1946–47 level, or, in the three cases where this level is itself below the upper limit permitted to "normal" licensees by subsection (3) as proposed to be amended, below 40,000 tons a year. I hope this Amendment will commend itself to the Government. I beg to move.
Amendment moved—
Page 39, line 21, leave out from ("activity") to ("and") in line 22, and insert the said new words.—(The Earl of Dudley.)
VISCOUNT HALL: I should like to assure the noble Earl that the firms he has in mind will be beneficiaries under the announcement which I have already made in relation to the preceding Amendment. I would suggest that the discussions which we propose to have in connection with the preceding Amendment should cover this Amendment as well. I think that that will be the better way to deal with the matter, and if the noble Earl cares to withdraw his Amendment this joint discussion can take place in that form.
VISCOUNT SWINTON: I think that is the right course. Obviously, the basis of this Amendment was that if you give something to people with a production of under 20,000 tons you should take into consideration other people who start with a handicap or "bogey," so-to-speak, of over 20,000 tons. Though they have certain merits on their own, the Amendments are partly consequential. Therefore, on the understanding that we agree that logically whatever consequential adjustments should be made on the first Amendment must follow, I think this is the right course. Subject, therefore, to what the noble Earl, Lord Dudley, says, I think that this matter had better be made part of the discussion we are going to have.
THE EARL OF DUDLEY: I gladly accept the offer of the noble Viscount and ask leave to withdraw my Amendment, on condition that it will be discussed with the previous Amendment.
Amendment, by leave, withdrawn.
9.0 p.m.
LORD TEYNHAM LORD TEYNHAM moved, in subsection (5) to omit "he is required by subsection (1) of this section to issue a licence in respect of the business concerned" and to insert:
"the expiration of six months after the date on which the said particulars were received by him."
The noble Lord said: This Amendment is consequential on the first Amendment moved to Clause 30 and accepted by the Government. I beg to move.
Amendment moved—
Page 39, line 35, leave out from ("before") to end of line 36 and insert the said new words.—(Lord Teynham.)
On Question, Amendment agreed to.
LORD TEYNHAM: I beg to move this Amendment, which is consequential.
Amendment moved—
Page 39, line 38, leave out from ("Act") to ("but") in line 41.—(Lord Teynham.)
On Question, Amendment agreed to.
Clause 30, as amended, agreed to.
THE MARQUESS OF READING: Before the next Amendment is moved by the noble Viscount, Lord Bridgeman, may I, at the request of my noble friend Lord Rennell, express his apologies to the Committee for his absence? He is engaged in an inaccessible part of the country tomorrow morning, and therefore has been obliged to depart.
Clause 31:
Revenues of Corporation to be sufficient to meet outgoings
31. It shall be the duty of the Corporation so to exercise and perform their functions under this Act as to secure that the combined revenues of the Corporation and all the publicly-owned companies taken together are not less than sufficient to meet their combined outgoings properly chargeable to revenue account, taking one year with another.
9.2 p.m.
VISCOUNT BRIDGEMAN VISCOUNT BRIDGEMAN moved to add to the clause:
"(b) their combined revenues from the activities specified in the first column of the
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Second Schedule to this Act are not less than sufficient to meet their combined outgoings as aforesaid in respect of those activities taking one year with another; and
(c) their combined revenues from each of their principal activities not so specified are not less than sufficient to meet their combined outgoings as aforesaid in respect of that principal activity, taking one year with another."
The noble Viscount said: Like the noble Marquess, Lord Reading, I should like to express my regret that my noble friend, Lord Rennell, is not here to move this Amendment. I think it would be much better for the Committee if he had been in his place. I cannot disguise from your Lordships the fact that one of the reasons why we move this Amendment is our concern lest is should be possible, in the early stages of the nationalised Steel Corporation, to conceal losses on working. I am sorry to say that I am fortified in that suspicion when I recall that there was a loss of £23,000,000 to the National Coal Board in 1947, albeit offset by a small profit on the last accounting period, and also that there have been losses, to which attention has already been drawn in your Lordships' House, on civil aviation. We still do not know what the losses will be on the railways. I have another reason for moving this Amendment, and that is that the words now in the Bill,
"the combined revenues of the Corporation and all the publicly-owned companies,"
are not entirely clear from an accounting point of view. In the Bill as drafted the combined revenues are expressed as being required to be "sufficient to meet their combined outgoings." But we do not know yet (and we should like some statement in clarification of this point) how these combined revenues are to be calculated. For example, is the figure to be struck after transfers to the reserve fund which is mentioned later on in the Bill? Is the figure to be struck after allowing for interest and redemption moneys on stock? We shall come to that question later, when we discuss the Seventh Schedule.
Those are two main questions. They are important because there is a direct conflict of interest between the consumers of steel products, on the one hand, and the stockholders of steel stock on the other. Naturally the stockholders would wish to feel protected to the greatest extent possible by the feeling that transfers

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have been made to the reserve and appropriations have been made for redemption. On the other hand, it is possible to argue that those transfers and appropriations would be made at the expense of the consumer, because they might—I do not say they would—result in a higher price thereby for steel products. We should welcome an explanation on this point. If it is not possible to-night, then perhaps it may be possible for us to have it at a later stage of the Bill. Perhaps I have asked these questions without due notice. If so, let us have the answers later. We want to know how the Government propose to interpret the wording of their clause in regard to what is revenue and what is not.
Now let me go on to the substance of the Amendment. As the Bill is drawn, it is required that the combined outgoings shall be balanced by the combined revenues of the Corporation and all the publicly-owned companies taken together. By that, I take it, is meant the combined revenues of the Corporation and all the publicly-owned companies—that is to say all the activities lumped together. We feel there is a certain amount of danger in that. This point was hardly discussed in another place, owing to the procedure there. We feel that there is a danger that it might be possible for the nationalised Corporation and its companies together, by means of the Corporation giving directions to the companies, to sell what one might call the monopoly products at a high price and then, having made a big profit on those monopoly products, to be able to sell the non-monopoly products at a lower price.
May I explain that in a little more detail, because we all know by this time that there are certain products in which the Corporation will have not a complete monopoly but a virtual monopoly. The Second Schedule processes are largely (up to about 90 per cent.) owned by the companies which are to be nationalised—the figures have been produced and I need not go into them again. Therefore, for the purposes of sales it is possible to say that in those processes—in the hot rolled steel and other things, which are dealt with in the Second Schedule—the Corporation will have a virtual monopoly and will be able to fix the price, because there will not be suffi-
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cient of those Second Schedule products manufactured other than by the Corporation to affect the price or to satisfy the consumers. If that profit were high—and in monopoly conditions it can be as high as you like—it would be possible to offset that profit against possible losses in the non-scheduled products, thereby making it possible to sell those products below their true cost price, that is to say, the price at which an ordinary company, having its ordinary overheads, its ordinary charges, and wishing to make an ordinary amount of profit, could sell those non-scheduled products.
That is why we are seeking to expand Clause 31 by adding to it two new subsections. If we succeed, the result will be that there will be three requirements to be satisfied. The first is the one which is now drawn in the Bill—namely, that the combined revenues of the Corporation and all the publicly-owned companies (that is to say, all the activities lumped together) shall be not less than sufficient to meet their combined outgoings. But remember: we are still slightly in the dark until we get a definition of "outgoings." By our Amendment we seek to add these two other conditions, the first of which provides for segregating the combined revenues of the Corporation and all the publicly-owned companies from Second Schedule activities. The second—which is the important one—provides that the combined revenues of the Corporation and of all the publicly-owned companies in each of the principal non-scheduled activities shall be shown in the accounts, and that it shall be possible to prove, because of compliance with those two provisions in this Amendment, that there is no risk of any unbusinesslike practices or underselling the market in nonscheduled products at the expense of an undue profit in the scheduled products, as would be possible without disclosure as the Bill is already drawn. This is a slightly complicated matter but I hope that what I have said has made it clear to the Committee. Your Lordships will see that there are two points: first, a definition of what is to be included in the revenue, and, secondly, the point which is specifically made by the two Amendments which appear in the Marshalled List. On behalf of my noble friend Lord Rennell, I beg to move.
Amendment moved—
Page 40, line 16, at end insert the said paragraphs.—(Viscount Bridgeman.)
LORD RITCHIE OF DUNDEE: I support this Amendment and I wish that I could add something useful to what the noble Viscount, Lord Bridgeman, has already said. If I may be allowed to do so, I should like to say a few words which I am afraid constitute a digression. I wish to make it abundantly clear that in the remarks I made last night nothing was further from my thoughts than to call in question for one moment the personal integrity of noble Lords opposite. If I gave that impression I deeply regret it, but the subject is one which has created widespread resentment, and I am afraid that in the heat of the moment I allowed myself to use words which are not normally used in your Lordships' House.
VISCOUNT ADDISON: In the first place let me say that we sincerely appreciate the intervention of the noble Lord, Lord Ritchie, and we accept what he has said in the spirit in which he has said it.
With regard to the Amendment, I feel rather embarrassed because the noble Viscount, Lord Bridgeman, was extraordinarily obliging and I would much like to follow his example. With regard to the items relating to revenue, I would call the noble Lord's attention to Clause 37, to which we shall come in due course. That clause deals with this specific matter. Therefore I will not say anything more about it now, but I was informed that the balance will be struck after appropriations to reserve—unless provided for under Clause 35—and revenue charges mentioned in Clause 37. There will be a proper allocation to reserve as is shown in the subsequent clause.
The particular Amendment before us relates to something quite different, as the noble Viscount has said. It asks that these companies should be called upon to have their accounts dissected and presented in separate parts. I think it is not a demand that is made on other companies operating in the same way, who are not called upon to segregate their activities and to show how this one balanced and that one did not. They are not obliged to have separate accounts for all their separate activities, and if we
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do not ask anyone else to do it, why should we ask these concerns? I am informed by legal advisers that all these companies will be subject to the rules of the Companies Act and they will have to provide their accounts in the form required by that Act. It requires that their trade results should be taken as a whole but does not require, as would these Amendments, the dissection of their activities into separate accounts, which would assuredly provide a bewildering job for an army of accountants. Notwithstanding the example of my noble friend, I am sorry I cannot be so obliging as to accept the Amendment. Similar companies, whose activities in accordance with their Articles of Association are somewhat diverse, do not now feel called upon to present separate dissections of their accounts. Why should we ask them to do it hereafter?
VISCOUNT SWINTON: Does the noble Viscount really say that the great industrial companies do not know whether they are making a profit or loss on their principal activities?
VISCOUNT ADDISON: I did not say anything of the kind. I hope they do. I said they were not called upon to present the accounts of all their different activities separately. It is not reasonable that they should. That is what the Amendment will require. In Clause 38 and later clauses we shall see that the Corporation and companies have very strict obligations placed upon them, but a dissection of this kind, which would require the employment of an unnecessary army of accountants, is not reasonable. I am sorry I cannot accept it.
VISCOUNT RIDLEY: I do not think that the noble and learned Viscount the Leader of the House has really directed himself to what I might call the object of this Amendment. It was explained by the noble Viscount when he introduced the Amendment and I think it is worthy of serious consideration. I am not at all clear how it could be expressed in better terms, but I readily admit it looks as if this were a roundabout way of securing what seems to me a necessary provision of the Bill. There are a large number of manufacturers who must go to the public companies for raw materials, and they are very much concerned about what their position will be in competition

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with the publicly-owned companies and the Corporation. They are quite a substantial section of the industry and I think is due to them to be satisfied, so far as it is possible to satisfy them. I do not think my noble friends who put down this Amendment would say it is the present intention of the Government or will be the intention of the Minister of Supply to instruct the Corporation to arrange their prices for the deliberate purpose of putting their competitors in these products out of business; but it is certainly something which well might happen under the Bill as it is drawn. It is something which in certain circumstances might appear to be in the public interest and may be generally adopted as the policy of the country.
I can see no protection in the Bill on this point. The Consumers' Council will have no means of deciding whether the prices of any particular product throughout its range of manufacture are correctly related to the stage of manufacture, either before or after, the point being that in making the finished steel you can perfectly well within one organisation take the profit on your hooks at any stage of manufacture, whether it be on ingots, semi-finished or finished products; and you can, as the noble Viscount, Lord Bridgeman said, sell these intermediate products at high prices, both to your customer outside and, in effect, to yourself. Therefore, you take a high profit on that particular stage of manufacture. Within one firm, of course, it is not a sale, but a transfer from one department to the next. That enables the large firm with continual processes throughout the whole operation to sell a finished product without taking any further profit on it, whereas the customer who has paid the intermediatory profit has to earn at least some profit in order to pay his way. This was not unheard of in the steel industry in the past, but it is a practice which the Federation have done away with. Unless the accounts were drawn in the way suggested, and were published, the Consumers' Council would not have any means of finding out whether or not that was being done. I do not think either that price control by the Prices Board, as proposed in a previous Amendment which was before the Committee, could touch the problem.
On the point of costs, I do not see how a large steel producing company could
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undertake their operations successfully unless they had accurate costing of all the stages of production. The present practice is that at various periods the costs of these operations of iron making, steel melting, rolling, and so on, of the major products are collected by the Federation; they are summarised, averages are taken, and a hypothetical cost is found. That is what one would expect in a modern, efficient plant. That is the present system by which prices are arranged, with the help of the Ministry of Supply and the Iron and Steel Board, as it was. I do not think one should be alarmed at the suggestion that it will put extra work on the industry. It is, in substance, being done now.
As to the difficulty of publishing such a statement, I do not size how there could be any disadvantage to the Corporation in having these figures known. It may be argued that it would give an opening to their competitors abroad. If that were held to be the correct view, one would suggest that the accounts, as prepared in the form now proposed, should be available for inspection and scrutiny by the Consumers' Council, and kept confidential inside this country. I do not think the noble Lord who moved this Amendment desires in any way to embarrass the Corporation by making their trade difficult abroad. What I think is wanted is some method by which the Consumers' Council can find out at what stage in the manufacture the iron and steel makers are taking their profits, and whether or not they are deliberately either running at a loss or just failing to cover their expenses on the more finished products throughout the range of manufacture.
If the Consumers' Council could get real information on that point—and I repeat that that type of information is being collected and used at present by the Federation—I believe they could easily avert the danger which the Amendment seeks to avoid. It is a subject which is constantly discussed at present by all the producers of Second Schedule products who are not coming into the ownership of the Corporation. Rightly or wrongly, they are concerned lest they should be treated in that way. Is it not worth trying to contrive some procedure of this kind so as to set their minds at rest? It is only fair to them. I have no doubt the Government will give us the assurance that they do not intend

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that the Corporation should try to drive such competitors out of business in a general way. As I have suggested, it might be worth making a further Amendment to make the Consumers' Council available to all stages of manufacfure, and to lay upon them the duty of satisfying themselves that the outside competitors are being dealt with fairly.
9.26 p.m.
LORD HAWKE: I have seldom been more astonished than when I heard the speech of the noble Viscount the Leader of the House on this particular matter. I can assure your Lordships that the army of accountants is already there, and they are already doing precisely the operations which the noble Viscount says they cannot do. There are only four activities which are concerned—iron ore mining, blast furnaces, making of steel, and the rolling of steel—and the turnover of each of those four activities runs into tens of millions of pounds. That is going to be the taxpayer's money, and surely the taxpayer is entitled to information to enable aim to judge which of these activities is being conducted efficiently and which is not. How is he to judge the efficiency of his Government if he has no idea what is the cost of getting iron ore into this country? The position of the private company is entirely different. The shareholders can go to the board once a year, and they can sack the board. We can sack our Board only every five years. Moreover, the shareholder can ask questions at the annual meeting, and he would probably get an answer on these particular points. In fact, many of these things are already published in the accounts. I really do hope that His Majesty's Government will reconsider their attitude.
LORD DE L'ISLE AND DUDLEY: I will not detain the Committee long, but I must try to find out where we agree or disagree upon this matter. I think the noble Viscount the Leader of the House, having heard so much weighty argument, would agree that the accountants are already there. We cannot define whether they are an army or a division, but the number is there. Although I speak as an accountant, it is not because I wish to give full employment to accountants, but simply that the accountants are retained in order to keep these cost accounts. Can we further agree that that
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is desirable? The second point upon which I think we might agree is that if the Corporation, or the companies which it controls, do sell one product at a profit and others at a loss then it is desirable in the public interest that that should be known.
The third thing upon which I think we might agree—I hope we shall—is that the position of a public monopoly, set up by Parliament after long debate, is different from that of any privately-owned concern. Therefore it must be the concern of Parliament to see not only that that monopoly acts, so far as it can, in the public interest but that the public know, and the consumers of that product know, that it is acting in the public interest. It might be said that it would be in the public interest for one of the scheduled activities, or one of the principal products not in the Second Schedule, to be sold at a profit and for others to be sold at a loss. We maintain from these Benches that if that is so it should be known. I have listened to various parts of this debate in the Committee stage, and although I do not claim to have an extensive knowledge of this Bill it always seemed to me a not very strong argument by the Government that they should constantly be saying: "You would not do this if it were a privately-owned concern." We are here considering a monopoly set up by Statute, and I would remind the noble Lords opposite that it was Mrs. Sidney Webb, I think, who said that publicly-owned Corporations should work within glass walls. I do seriously recommend to the noble Lords opposite that, having set out upon what we regard as a disastrous course, they should follow their prophets.
VISCOUNT ADDISON: I have listened with great interest to these observations but I have on my brief some particulars of the divers activities of some of these concerns which are now being considered. It is well known that in the course of manufacture a number of articles may be moulded or partly manufactured because they contribute to the profitable employment of the machinery as a whole. But you do not have presented, and nobody has asked for, separate accounts of each individual item in these concerns, though that would be involved if we were to accept the Amendment. I am informed

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that some of the activities, for example, of the concerns range as widely as steel tennis racquets and moth balls.
VISCOUNT SWINTON: Would the noble Viscount read the Amendment to which he is addressing his speech?
VISCOUNT ADDISON: I have read it many times.
VISCOUNT SWINTON: Then perhaps he would read it again and he would grasp it because it says:
"(b) their combined revenues from the activities specified in the first column of the Second Schedule to this Act are not less than sufficient to meet their combined outgoings as aforesaid in respect of those activities taking one year with another; and
(c) their combined revenues from each of their principal activities.…"
The manufacture of racquets is not one of their principal activities.
VISCOUNT ADDISON: That is all very well, but who is to decide where subsidiary activities end and principal activities begin? I hope the noble Lords who want minute dissection of these accounts will say that that has gone far enough. I am also reminded that in the debate in this House on the Companies Act, in which the noble Viscount took an active part, it was at one stage contended that the dissection of accounts was not a practical proposition in a trading concern—that was contended in the House by the noble Viscount opposite. I do not pretend to be an expert in these matters, but I have a certain amount of horse sense, and I am sure that it is not sense to place on them a demand of this character. I do not want to go into further details but as a matter of fact it would land the companies in a grotesque position.
May I say a word with regard to the other contention of the noble Viscount in his opening remarks, that some things can be sold at a loss and others at a profit? That situation exists now. I have no doubt that it will continue to exist in' certain forms—in some of these firms, perhaps. One product may be ancillary to something else, and one product may be more profitable than another. I honestly say that I do not like this suggestion. When these companies are working, and their shares are owned by a national Corporation, they will be just as honest and just as decent as they are now. We shall not try to deceive ourselves or anybody
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else. I do not like that suggestion. It is not worthy of the noble Viscount. Anyhow, this Amendment would impose upon these companies a duty which is not placed on anybody else. It is not required under the Companies Act, and it is not a reasonable suggestion.
LORD DE L'ISLE AND DUDLEY: May I refer the noble Viscount to page 7, on which there is some definition of products and of the principal activities of the Corporation? It is in the Bill.
VISCOUNT ADDISON: They range very widely.
VISCOUNT SWINTON: Yes, but that is not what this clause means.
VISCOUNT BRIDGEMAN: The time has now come to say a word or two in answer to the various speeches. May I first go back to the question of revenue? I should like to thank the noble Viscount, Lord Addison, for the explanation which he has given, which is reassuring to us. But when we come to this other matter—that is to say, the real subject matter of the Amendment—then I should not like the noble Viscount to think that we have been reassured by anything he has said. I will give one or two reasons for that statement. First, as my noble friend Lord De L'Isle and Dudley said, the case is altered. For private enterprise companies, all starting level and under the same conditions, you substitute a large Corporation operating on a monopoly basis under Act of Parliament; and that is the underlying reason for these Amendments. There was a certain amount of comparison with the companies Act, but that comparison does not entirely lie here.
May I draw your Lordships' attention to the wording of the Bill as drafted? It says:
"It shall be the general duty of the Corporation so to exercise their powers as …"—
to secure that this and that happens. That does not say that these accounts should be published. The analogy lies, I think, not with the published accounts of public companies but with the cost accounts that public companies have to keep for internal circulation to make sure that they are not "going bust" by allowing Uneconomic production of this product or that. Whatever may be the view in Whitehall, I have taken the view of the

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noble Viscount, Lord Ridley (and I am sure the noble Earl, Lord Dudley, would agree with me if he were here) and I have provided myself with a set of cost accounts of a steel-producing company partly in the Third Schedule, about which I know a good deal. I want to endorse very strongly what has been said by my noble friend Lord Hawke. The accountants are there, and it would be impossible for any company in the Third Schedule now to carry on their activities without "going broke" if they did not keep cost accounts sufficiently clear to show profit and loss. That is one thing; the publication of accounts, to which we shall come later in the Bill, is quite another.
Those are the points on which we differ. But I am not going to suggest that we press this Amendment any further. I should like to draw your Lordships' attention to the Amendment to Clause 38 in the name of my noble friend Lord Rennell. I think that the noble Viscount, Lord Swinton, will agree with me when I say that if we withdraw this Amendment we shall not, when we come to the Amendment on Clause 38, feel inclined to be so accommodating. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 31 agreed to.
9.40 p.m.
Clause 32:
Borrowing powers of the Corporation and of publicly-owned companies
(4) The aggregate amount outstanding in respect of the principal of any stock issued by the Corporation for the purpose of the exercise of their powers under this section, and in respect of any temporary loan raised by the Corporation or any publicly-owned company, shall not at any time exceed the sum of three hundred and fifty million pounds:
Provided that nothing in this subsection shall prevent the Corporation from borrowing in excess of the said sum for the purpose of redeeming any British Iron and Steel Stock which they are required or entitled to redeem or repaying any money temporarily borrowed under subsections (1) and (2) of this section.
LORD HAWKE LORD HAWKE moved in subsection (4) to substitute "two hundred and fifty million pounds" for "three hundred and fifty million pounds." The noble Lord
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said: Here we come to the borrowing powers under this Bill, and our Amendment seeks to reduce the amount for which these powers may be exercised from £350,000,000 to £250,000,000—a large enough sum, in all conscience. At one time I used to keep a tally of the borrowing powers under the various nationalisation Acts and other Acts of a similar nature which came before us, but I am afraid I gave that up long ago. I think I had passed the £2,000,000,000 mark when I gave up, and they still go on. The consumption in individual Acts tends to go up and the saving of the nation tends to go down.
I must remind your Lordships of a fact that we are all apt sometimes to forget: that there are only three ways by which you can finance capital expenditure. You can do it from private savings, you can do it from a Budget surplus or you can do it by printing money. At the present moment private savings are an unknown but apparently diminishing quantity; Budget surpluses are here to-day and gone to-morrow, and we quite rightly eschew the printing press. Wherefore, whence are we to obtain these enormous sums? As a result of the borrowing powers in these various Acts we have landed ourselves into a position in which we have to exercise the utmost financial care. I submit that figures of this nature put into the Bill give the impression of the very reverse: that we are not using financial care. They produce an atmosphere of profligacy. I do not say that His Majesty's Government are going to spend that amount—they could not do it if they tried—but the fact that the figures are there in the Bill leads to a feeling that money does not count.
That applies particularly—as any of your Lordships know who have had such contacts—to planners and engineers. If there is one thing they like, it is the idea that somewhere around the corner is a gigantic sum of money upon which they can lay their hands before very long. Their schemes become more grandiose and their needs more exigent. We see this all over the world to-day. We have four-year plans, five-year plans and six-year plans everywhere. They are like the little doves that came back into the Ark, but instead of being harbingers of fine weather they are regarded usually as bringing bankruptcy in their train. All

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over the world we have the same problem. There has been a redistribution of income all over the world. Unfortunately, the receivers have not yet learnt the saving habits of the payers. The result is that there is a general decline in savings everywhere, as in this country; and many countries, of course, are using the printing press. Any method of financing other than the printing press means that, in effect, you have to ask people to stop consuming something to-day which they want in return for something which they will not see for some time and may not see the benefit of in their lifetime.
This particular industry has a plan of reconstruction to cost a total sum of £240,000,000. That can be spent—though there are physical limits to the amount of spending one can do—at a rate of about £30,000,000 or so a year. So that in this Bill, at one fell swoop, we are writing in ten years' expenditure in its borrowing powers. Why should we do this? Why not let the Corporation come back to Parliament, say, in five or six years' time? Surely that would be much more in the public interest? I feel that His Majesty's Government have let their enthusiasm run away with them in matters of this kind. They overlook the fact that to spend these vast sums means that they must persuade somebody to stop spending money on themselves. There is a limit to what free people will do, and it looks as if that limit is very nearly reached at the moment. I believe His Majesty's Government are oblivious of this limit. If they were not, I do not believe they would write into this Bill such extravagant figures. I beg to move.
Amendment moved—
Page 41, line 12, leave out ("three") and insert ("two").—(Lord Hawke.)
VISCOUNT ADDISON: I was charmed by the noble Lord's speech. The earlier part had nothing to do with the Amendment, but it was very charming. Most probably it would have received great attention at a meeting of the Primrose League. But may I come to the other facts behind this particular figure? There are other facts, and I will inform the Committee of the precise calculations, after which I hope the noble Lord will feel satisfied that this is not the result of the activities of some fanciful person who draws notes. The figure in the Bill at
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present is £350,000,000; that is the borrowing power of the Corporation, in the course of years, as these schemes develop. At the present time the modernisation plans of the industry represent a call, again in the course of time, of £250,000,000—that is the figure to which the noble Lord has referred. In addition to that, the British Iron and Steel Federation have considerable plans in the way of projects to be initiated during the period 1950 to 1955. I understand that those are excellent projects, and it is anticipated that in the course of time—of course, it will be several years—these projects will require a further £100,000,000.
Then there are various minor schemes which are already in contemplation and which may require an additional £30,000,000. There is also provision for the transfer of various assets with which I need not bother the Committee. Then there is a very important item of £50,000,000 which has been lent to the industry by the Finance Corporation which will have to be repaid out of these moneys—that is due For repayment. That is a further £50,000,000 which has already been guaranteed or loaned to these companies. These various things, which arise out of schemes which, as I believe, are excellent, and which are already conjectured or approved, added together in cold-blooded arithmetic, amount on their own to about £460,000,000. But there is money available in the Third Schedule companies amounting to £115,000,000, which leaves a net figure of about £350,000,000; and that is where the figure in the Bill comes from. If we were to take out "three" and insert "two" it would mean that the Corporation would not have sufficient borrowing powers to provide for the excellent enterprises which are already contemplated. That is how the figure is arrived at, and that is why I cannot accept the noble Lord's Amendment.
VISCOUNT BRIDGEMAN: I think this Amendment has served one useful purpose. It has cleared up one point, though not the other. If I understood the noble Viscount rightly, his contention was that in the period from 1950 to 1955—shall we say, five or six years—£350,000,000 would be required.
VISCOUNT ADDISON: No. It may not be possible to spend it in that time;

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it may not be a practical proposition. But the plans which are contemplated to be initiated in that period would cost £100,000,000. Of course, they may not be completed. They will take many years to complete.
VISCOUNT BRIDGEMAN: I am very much obliged to the noble Viscount. Let me get this absolutely right. The £350,000,000 includes not only what will be required in the next five or six years but also an element for items which have been budgeted to start, but which may not be completed, in those years. That brings me back to the point which my noble friend behind me made—namely, that we think it would be desirable that the amount of money allocated at any one time should not be so much as to allow an unreasonably long period before the matter has to come before Parliament and the Corporation have to give an account of their stewardship.
The next point is that although we had details from the noble Viscount of an additional £100,000,000—that is, additional to the £250,000,000—that £100,000,000 is news to us. Certainly we had no idea that the Federation had put forward figures of that sort additional to their original development plan. I am beginning to wonder whether a certain amount of money, a certain number of millions, has not been added on to this original estimate of £250,000,000 (which was clear to everyone) without any very certain idea as to what would be wanted, simply because it was thought that it would be as well to have a margin, as people might not be confident in the Corporation's ability to carry through all the plans for which they had planned, and at the same time the Corporation would not care to come back to Parliament and say so. I still feel that this is fair and well-founded, but I think that in the absence of further information we must leave it at that. The ball is now on the opposite side of the House. If there is no response, I shall ask my noble friend to withdraw the Amendment.
VISCOUNT ADDISON: In reply to what the noble Viscount has just said may I read to him the passage which deals with the matter upon which he has just touched? This is how it runs:
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"The British Iron and Steel Federation have already planned to begin the consideration of a new plan of projects to be initiated in the period 1950–1955. With projects under the present plan continuing to be completed at the present speed, it is considered that a very substantial part of the first modernisation plan will be completed by 1953, and therefore some provision must be made for that part of the expenditure under the second plan (consisting of additional capacity in melting and finishing and some 30 per cent. of plant replacement) which will be disbursed by the middle '50's. For this purpose an estimate of £100.000.000 has been taken."
That was what I indicated when I spoke before.
LORD HAWKE: I thank the noble Viscount the Leader of the House for those very interesting figures. Perhaps he will ask me to accompany him to the seaside the next time he goes, and to talk with him there. One thing which the noble Viscount never told us was where he expects to find the money. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
VISCOUNT BRIDGEMAN VISCOUNT BRIDGEMAN moved to add to subsection (4):
"but any moneys borrowed for such last mentioned purpose shall be repaid within one year from the date of the borrowing thereof."
The noble Viscount said: This Amendment follows on the last in the sense that there are more or less permanent borrowing powers with which the last Amendment dealt, and temporary borrowing powers with which this Amendment deals. Again I am approaching the matter in a suspicious frame of mind. As the Bill is drawn, it may be possible to stultify the limitation, which stands at £350,000,000, by having a bottomless purse for the temporary borrowing. Supposing the Treasury were in league with the Corporation, it would not be difficult to borrow money, ostensibly for temporary purposes, and then, by failing to have any stipulated repayment of the short-term advances on any due date, arrive at a position where the short-term advances had become in fact long-term advances. This Amendment has been put down in order to examine the matter a little further. If the advances referred to are really short-term, then it would be reasonable to insert our Amendment, which provides that the money should be repaid within a year. Under the Amendment, borrowing for short-term purposes would be limited to what we

725
might call genuine short-term borrowing—to finance such things as seasonal fluctuations of trade. It would be a safeguard against the limitation in subsection (4) being got round on the plea of temporary borrowing, which turns out to be not so temporary as at first thought. I hope that in the answer we shall have the intention in regard to temporary borrowing clarified a little more than it is in the Bill.
Amendment moved—
Page 41, line 18, at end insert the said words.—(Viscount Bridgeman.)
VISCOUNT ADDISON: I thank the noble Viscount for the way in which he has moved this Amendment and I shall do my best to reply to the inquiry he has made The noble Viscount will notice that the additional borrowing in the Bill is limited by the words:
"Provided that nothing in this subsection shall prevent the Corporation from borrowing in excess of the said sum for the purpose of redeeming any British Iron and Steel Stock which they are required or entitled to redeem or repaying any money temporarily borrowed.…"
The Corporation could not borrow money for any other purpose. I am informed that it may sometimes be necessary to have borrowing for the redeeming of stock, but of course stock would not be repaid every year and the money borrowed would be used for the repayment of issues due for redemption. I should like to quote the assurance I can give the noble Viscount with regard to the disposal of these funds. The intention of the proviso is that the money so borrowed in excess of the limit should immediately be applied in paying off the existing debt, so that the outstanding borrowings of the Corporation would be brought down again to the limit. That is the specific purpose, and it will be applied in that way. I suggest that it could not be borrowed for any other purpose.
VISCOUNT BRIDGEMAN: I agree with everything the noble Viscount says, but if he reads Clause 32 (1) he will see that the clause goes on to say that the Corporation may borrow
"such sums as the Corporation may require for meeting their obligations or discharging their functions under this Act including the temporary lending of money to any publicly-owned company."
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I think that is wider than the particular obligation which the noble Viscount mentions. These words give rise to the suspicion.
VISCOUNT ADDISON: That would mean the ordinary common business of the company and the use of its ordinary moneys. This proviso limits strictly the borrowing and the purposes, and I can assure the noble Viscount that the Corporation could not use it for any other purpose than that I have described.
VISCOUNT BRIDGEMAN: I am grateful to the noble Viscount for his explanation. However, it does not entirely satisfy me, because I feel there are still a certain number of loopholes. Unless we have a complete assurance that it will not be so used, it would be possible as this clause is drawn, in one way and another to increase the actual outstandings in the way of borrowing. The noble Viscount referred, as I think I did, too, to the financing of seasonal requirements in the way of stock.
VISCOUNT ADDISON: The working capital.
VISCOUNT BRIDGEMAN: The working capital, which is something we all understand. My point is this. If those requirements are seasonal they can be repaid within the year. If they stand out and cannot be repaid within twelve months, they cease to be seasonal and become part of the permanent capital of the company, because they are unable to be repaid. It was for that purpose that we moved this Amendment. What we seek to avoid is the permanent capital of the company exceeding the £350,000,000 which Parliament has authorised, by the making use of Clause 32 (1) in a way that is not intended by any of us.
VISCOUNT ADDISON: I can give the noble Viscount the assurance he asks for, fully and faithfully.
VISCOUNT BRIDGEMAN: In the light of that assurance, for which I thank the noble Viscount, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 32 agreed to.
Clause 33:
British Iron and Steel Stock
(2) The Seventh Schedule of this Act shall, subject to the provisions of this section and of the Fourth Schedule to this Act, apply with respect to the issue, transfer and redemption of British Iron and Steel Stock and otherwise in relation to such stock:
Provided that—
10.3 p.m.
LORD HAWKE LORD HAWKE moved to omit subsection (2). The noble Lord said: By this Amendment we seek an opportunity for some discussion on the principles involved in the redemption of capital which is provided for in the Seventh Schedule, where it is laid down that it shall be redeemed in a prescribed period, the prescribed period being ninety years. Under Clause 37 of the Bill the Corporation have the duty to provide funds for renewals. Clause 35 sets up a general reserve which, amongst other things, is available for capital purposes. The question is: Should the Corporation, in addition to this, redeem their capital debt? If so, is ninety years the right period over which to redeem it? These are the arguments, as I see them, against redemption. But there is provision for replacements and renewals—money with which to replace the plant. There is also provision for new capital to go into the business for the purposes for which it is always required. So that in theory, at all events, at the end of ninety years if there were no redemption of capital the existing plant should have been renewed, and the capital debt should be the present capital plus anything else raised in the interval but less the plant scrapped or written off.
Another argument against redemption, of course, is that it is a burden on current production, and an unnecessary burden when redemption is not required. The arguments for redemption, as I see them, are that something more than renewals and replacements is needed to keep a business going. New capital has to be put in the whole time, and though in theory all new capital is fruitful, in practice it often turns out to be unfruitful. Moreover, a whole industry can become obsolete. Also, of course, if the capital is not redeemed the fixed charges increase by the amount of the interest on the new capital which is issued. Frequently, un-
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less it is an expanding industry, the production will not have increased, so that the higher fixed charges will be borne by the same production. Those are the pros and the cons as I see them.
Now what happens to-day? By and large, industry per se does not redeem its capital. Except in rare cases, the Inland Revenue do not permit it as a deduction. On the other hand, the local authorities, in housing loans and so on, do redeem. The railways do not redeem, and the result is that their capital over the ages has increased the whole time. It has worked out all right in the past in respect of industry, because the value of money has steadily depreciated. It has been possible to carry the extra fixed burden by the increased value of the same volume of production as time went on, but that does not necessarily make it a good system. I submit that it is right to redeem this stock and, on the whole, ninety years seems a reasonable period over which to do it. A distinguished foreign economist once suggested to me that every investment ought to be amortised in twenty years. That I think is too drastic, and ninety years, I submit, is a reasonable period. I bee to move.
Amendment moved—
Page 41, line 38, leave out subsection (2).—(Lord Hawke.)
LORD PAKENHAM: I am not sure whether the noble Lord, Lord Hawke, is moving this Amendment in order to make a statement himself, to elicit a statement, to do both or because he wants the Amendment carried. I gathered it was not the last, or at any rate he did not throw himself into it with his usual zest. I gather in fact that he is not urging the House to leave out subsection (2). I would like to know before replying.
LORD HAWKE: I should not be urging the House to leave out subsection (2) unless others of their Lordships had stood up and produced strong arguments for not having this stock redeemable.
LORD PAKENHAM: As others are not throwing themselves into the fray very heartily, I assume there is no pressure to leave out subsection (2). I think the noble Lord will agree that that is wise on the part of the Committee, because it is only common form. It appears in the Transport and Electricity Stock Regulations, and I should imagine, therefore, that there

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is no objection to this subsection at all. Indeed, it would surely be very mistaken to leave the power with the Minister instead of using the existing procedure. In reply to the interesting and general observations of the noble Lord, I would mention, in passing, that the Bill does not oblige the Corporation to charge redemption of capital to revenue. The Corporation can provide funds for redemption from money set aside for depreciation or from the cash resources generally. I have made a statement which the noble Lord will find to be accurate, and as I gather he does not wish to press the Amendment I would venture to suggest that perhaps he would see his way to withdraw it.
LORD HAWKE: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 33 agreed to.
Clause 34 agreed to.
Clause 35:
General reserve
35.—(1) Without prejudice to the Corporation's power to establish appropriate reserves for replacements or other purposes, the Corporation shall establish and maintain a general reserve.
(2) The Corporation shall contribute to the general reserve such sums at such times as they may determine and the management of the said reserve and the application of the moneys comprised therein shall be as the Corporation may determine:
Provided that—
(b) the power of the Minister to give directions to the Corporation shall extend to the giving to them with the approval of the Treasury of directions as to any matter relating to the establishment or management of the said reserve or the carrying of sums to the credit thereof, or the application thereof, notwithstanding that the directions may be of a specific character, and the Corporation shall give effect to any such directions.
10.11 p.m.
LORD ROCHDALE LORD ROCHDALE moved in subsection (1) to omit all words down to and including "purposes." The noble Lord said: This clause lays down that the Corporation shall establish a general reserve. That is a very right and proper provision, but if your Lordships will look at the first two or three lines of this clause you will see that it says:
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"Without prejudice to the Corporation's power to establish appropriate reserves for replacements or for other purposes,"
And it is of the purpose and propriety of those two lines of which we are in some doubt. The matter was discussed in another place but no definite information was given on it, though on one matter pertinent to the discussion the Solicitor-General did make this point. He said that the policy debased in this Bill was to follow, so far as can be, the principles and procedure laid down in the Companies Act, 1948. It is on that assumption that I want to say a few words about this Amendment.
The words that we seek to delete seem to us to imply the granting of powers to the Corporation to establish special reserves for replacements and other purposes. The question is: Why are these special reserves for replacements and other purposes necessary? Do not Clause 35 and Clause 37 contain all the powers needed, without having these two lines at all? It may be that these two lines have some other meaning which we have not seen, and perhaps when the noble Lord comes to reply we shall learn something about it. The word that is causing us difficulty is the word "replacements" in a clause where it is placed in context with the word "reserves." It seems that the word "replacements" presumably must mean more than the word "renewal," which is quite a common word in this context. If the word "replacements" were used here simply as "renewal," then I would suggest that it would be quite improper for the sums in question to be met from reserves; they should be, as we shall see shortly in Clause 37, met out of revenue.
That is clearly the position under the Companies Act, and I would like to read one or two short points from that Act. The Companies Act says:
"The expression 'reserve' shall not, subject as aforesaid, include any amount written off or retained by way of providing for depreciation, renewal, or diminution of value"
and so forth. That paragraph also goes on to to say that where the amount written off is greater titan the amount which, in the opinion of the directors of the company, was reasonably necessary for the purpose in hand, then the excess might be met out of reserve. Now in

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Clause 35 of this Bill it may be that the word "replacements" is used purposely to allow for such cases of excess over and above what would normally come under the heading of renewals. It may be that, instead of merely renewing the existing machine or plant, it will be decided to put in a new and more modern plant of perhaps greater capacity and better in every way. But if that is the answer, surely it would come under the heading that is mentioned a little further on in the same clause, on page 43, line 13:
"… works the cost of which is properly chargeable to capital,"
The conclusion I come to, therefore, is that without these two lines the provisions of the rest of the clause are quite adequate to deal with all matters that are properly chargeable to capital.
There is one other point, and that is about the three words after "replacements"—"or other purposes". It is clearly laid down that this reserve is to be used only for the purposes of the Corporation, and therefore presumably can be used for any of the purposes that are appropriate—in other words, any of the purposes that are properly chargeable to capital. There again, why are these words necessary? This identical phrase comes in the Transport Act and I have no doubt that the noble Lord may argue that if it is there then it might as well be here—particularly as nothing was said about it in your Lordships' House. But the case of the Transport Act was entirely different; there, there was a monopoly with no competitor. Here you have a completely different case; you have a Corporation carrying out many activities in which there are many competitors operating under conditions of private enterprise. One has only to consider that difference to see that matters improperly charged to revenue that should be charged to capital might react very unfairly on some of the Corporation's competitors. I hope that the noble Lord will be able to throw some light on why these words should remain in this clause. I beg to move.
Amendment moved—
Page 42, line 33, leave out from beginning to ("the") in line 35.—(Lord Rochdale.)
LORD PAKENHAM: The noble Lord, who understands these things very well, has raised some detailed points, but I
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hope to allay his anxiety. He has pointed out that the same words occur in the Transport Act. He might have added that they are also to be found in the Electricity Act and the Gas Act, and therefore they seem to me to be eminently respectable. I was a little surprised to find the noble Lord so reluctant to see the Corporation setting up reserves of this kind. I would particularly deal, however, with his point about replacements. With the present high costs of capital equipment, normal depreciation and renewal provisions which are usually based on the original cost of the plant may be inadequate, and a reserve for replacements would mean that the Corporation would be setting aside sums to provide, in addition to the proper provision for depreciation made under Clause 37, the money needed to meet the heavy additional cost of new plant. That is really the point—the heavy additional cost of the new plant. That is the thought behind the special reserves for replacements. I hope that with that explanation the noble Lord may see fit to withdraw his Amendment. There is nothing sinister here. It is a common form, and we felt it might help in this particular matter.
LORD ROCHDALE: I am grateful to the noble Lord. I had no intention of implying that there was anything sinister; nor did I say anything against the Corporation's right to have reserves. What I did want to know, about which I am still in a fog, is why those lines were there at all. From what the noble Lord says I gather that he is satisfied that they in no way contravene the idea that the Corporation should act scrupulously under the Companies Act, 1948. If that is so, I beg leave to withdraw the Amendment.
LORD PAKENHAM: I cannot commit myself or the Government to that last statement, because in various ways the Corporation is in a position different from most of the companies affected by the Companies Act. But certainly the Corporation is not out to be unfair to anybody.
LORD ROCHDALE: In relation to this particular point of the Companies Act, I meant.
LORD PAKENHAM: I need further notice of that question. If the noble

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Lord desires a precise assurance about the bearing of the Companies Act on this particular point, I feel that he will probably be satisfied to have a discussion afterwards. May I suggest that, if he is not satisfied, he puts down his Amendment at a later stage?
LORD ROCHDALE: On that understanding, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
10.21 p.m.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved, in subsection (2) (b) after "directions" (where that word first occurs) to insert "in pursuance of section four of this Act." The noble Lord said: This is not a difficult Amendment or one which need detain the Committee many moments. The purpose is to make clear that any directions given by the Minister are given by virtue of the powers which the Minister has under Clause 4 (1), and therefore must be given only
"in relation to matters which appear to him to affect the national interest."
Those are the words in subsection (1), but in this subsection the Minister is empowered to give to the Corporation directions even of a specific character in relation to the establishment and management of their reserve. If it is stated that these powers derive from those under Clause 4 (1) doubt must remain as to whether the specific directions authorised in this clause need, in fact, be in relation to matters which appear to the Minister to affect the national interest. I am sure that such specific directions would not be given lightly, but should be circumscribed by this phrase, unsatisfactory though we may consider it.
An almost identical Amendment was put down in another place, and it was guillotined. It was again put down on Report and it was negatived, after the Solicitor-General had used these words:
"The Minister will, of course, only give directions which in the general interest …"
We have had "national interest," "public interest," and now "general interest." What the Solicitor-General meant by those words I am not clear, but what I am clear about is that the purpose of this Amendment is that his powers should be exercised only by virtue of the powers which the Minister
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possesses under Clause 4 (1). I beg to move.
Amendment moved—
Page 43, line 1, after ("directions") insert ("in pursuance of section four of this Act").—(Lord Balfour of Inchrye.)
LORD PAKENHAM: I am sorry not to be able to give a straightforward and facile assurance to the noble Lord. There was one point where I may or may not have heard the noble Lord correctly. Very naturally he took us back to Clause 4 (1) which says that
"The Minister may, after consultation with the Corporation, give to the Corporation directions …"—
The noble Lord added:
"in relation to matters which appear to him to affect the national interest"
If I heard him correctly, the noble Lord inadvertently left out the words "of a general character."
LORD BALFOUR OF INCHRYE: I am sorry.
LORD PAKENHAM: It is rather a material point because, under Clause 4 (1), as the noble Lord appreciates, the Minister is confined to "directions of a general character." He cannot give a specific direction even where the specific direction is, in his view, in the national, public or general interest, or however you like to phrase it. Therefore, Clause 4 (1) does not do what we need in this case, because there may be a necessity, though seldom arising, for a specific direction. In practice, it is far more likely that the Minister, in consultation with the Corporation, will reach agreement, but we feel it necessary that there should be this reserve power which gives him this specific power to guide investment in the national interest. If the noble Lord will look at the clause which he and I are studying, he will see that there are two conditions or provisos, the first of which says,
"No part of the said reserve shall be applied otherwise than for the purposes of the Corporation or of the publicly-owned companies."
The Minister's power to give the directions would arise mainly where the Minister was intent that the Corporation should relate its investment policy to the financial policy of the country as a whole. I think it is very unlikely that a direction

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would ever eventuate in those circumstances, but we feel the power is necessary and it does not exist in this form under Clause 4 (1). After that explanation, I hope the noble Lord will withdraw his Amendment.
LORD BALFOUR OF INCHRYE: I thank the noble Lord for his explanation, and I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE moved, in subsection (2) (b) to omit "or the application thereof." The noble Lord said: This Amendment deals with a different point. Its purpose is to delete the provision giving the Minister power to give directions to the Corporation as to the application of their reserve. I do not think one can take any exception to the Minister giving directions as to the establishment or the management of the reserve, but we feel it is undesirable that he should be empowered to direct the specific uses to which that reserve might be put. For example—although I am sure it has never happened—an unscrupulous Minister might direct the Corporation to subsidise some extraneous activity, such as the manufacture of umbrella frames or tennis racquets, about which we have heard, until the private enterprise makers were forced out of existence. That is a possibility. We also feel that if the Minister has this power there is an objection that the Corporation are deprived of their financial autonomy, which we feel they should possess.
This subject was dealt with in another place when the Solicitor-General said this:
"We feel that the Minister must reserve to himself the power, in case of need or in case he thinks it necessary so to do, to give this sort of direction with regard to this very large pool of available reserve, which will be there to be used for national purposes in case it is required so to do."
Coming from the Solicitor-General, it sounded to us rather ominous that the Minister could direct that the reserve should be used for purposes which he felt were in the national interest. As I have already said, the Minister might use his powers unwisely, and a less responsible successor to the present Minister might consider it in the national interest to direct that the reserve should be applied to keeping a plant in operation
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in a period of low demand in order to maintain full employment. We do not object to the Minister having the power to give directions as to the establishment or the management; it is to the specific use that we take exception, and which we question in this Amendment. I beg to move.
Amendment moved—
Page 43, line 6, leave out ("or the application thereof")—(Lord Balfour of Inchrye.)
LORD LLOYD: I would like briefly to support my noble friend, and I want to put one specific question to the noble Lord, because he mentioned on the last Amendment that the Minister could give directions to the Corporation for investment in the national interest. In addition to the points raised by my noble friend, I would like to ask whether that means that the Minister can give directions which would have the effect of putting the whole of this reserve into gilt-edged securities or out of gilt-edged securities, with all that that has meant in the past.
LORD PAKENHAM: It would certainly be within the power of the Minister to influence the Corporation in that way, but it is most unlikely that he would proceed by way of direction. As I pointed out in dealing with the last Amendment, there is a clear proviso in the clause stating that the reserve may not be applied otherwise than for the purposes of the Corporation. I do not know whether the noble Lord wishes to pursue this at length, after what I said on the last Amendment, but I would content myself by reminding your Lordships that the powers here are pretty complete in the way of exercising financial control of the Corporation. This really is in line with the general financial relations of the Minister and the Corporation.
LORD BALFOUR OF INCHRYE: We do not like it, for it seems to rely so much on there always being a good Minister. We do not like having to depend on that. We have a good Minister now, and I wish we could be sure that in the years to come it will always be so. Nevertheless, in view of the explanation which the noble Lord has given, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 35 agreed to.
Clause 36 agreed to.
Clause 37 [Sums which are to be chargeable to revenue account]:
10.33 p.m.
LORD ROCHDALE LORD ROCHDALE had an Amendment on the Marshalled List to insert after "depreciation" the words "or diminution in value." The noble Lord said: The next Amendment on the List is closely connected with one which I moved to Clause 35 a few moments ago. In view of the statement of Lord Pakenham, my noble friends and I would like to have an opportunity of giving further consideration to the Amendment before it is discussed in this Chamber. Therefore, I do not propose to move it now but I retain the right to move it at the Report stage.
LORD PAKENHAM: May I just say that while we do not feel that the noble Lord's Amendment adds anything to the Bill, we would not in fact resist him violently if he decided to press it very hard.
VISCOUNT SWINTON: Why not accept it now?
LORD PAKENHAM: I am always against accepting an Amendment which we feel will do neither good nor harm, so I suggest that we leave it until the Report stage.
Clause 37 agreed to.
Clause 38:
Accounts and audit and statistics
(3) So soon as the accounts of the Corporation have been audited, the Corporation shall send to the Minister—
(b) copies of the accounts of each of the publicly-owned companies prepared in accordance with the Companies Act, 1948, but so that where group accounts within the meaning of that Act are prepared by any company it shall not be necessary for a copy of the accounts of any subsidiary dealt with in those group accounts to be sent to the Minister;
and copies of every statement, account and report required to be sent to the Minister under this subsection shall be made available to the public at a reasonable price.
VISCOUNT SWINTON VISCOUNT SWINTON moved, in subsection (3) (b) to omit all words after "1948." The noble Viscount said: We now come to an Amendment to which we attach great importance. I can deal with it briefly, in view of the debate
738
which we have already had on Clause 31, and in view, particularly, of the observations made by the noble Viscount the Leader of the House in rejecting all our proposals on Clause 31 for the reason which he gave—that we should get under Clause 38 such detailed and meticulous information about these companies. It will be convenient, if I may have the leave of the Committee to do so, to say a few words now about the first two Amendments to this clause. They raise slightly separate issues and yet they hang very much together. In the first of the Amendments, I ask the Committee to leave out certain words. Your Lordships will see that on page 44, line 26, it is stated that:
"copies of the accounts of each of the publicly-owned companies prepared in accordance with the Companies Act, 1948, but so that where group accounts within the meaning of that Act are prepared by any company it shall not be necessary for a copy of the accounts of any subsidiary dealt with in those group accounts to be sent to the Minister."
I suggest that we should leave out from "1948" to the last word of that paragraph.
Why should not these accounts be sent to the Minister? There is no question about collecting a large number of accountants who are not there. Of course the accountants are there, and the accounts are there. It is only a question of what should be done with those accounts. Why should they not be sent to the Minister? I suppose I shall he told that if they are sent in, they will ultimately be published to Parliament. That is exactly what we want—to have adequate knowledge. If the accounts are not submitted to Parliament, we shall not know what is happening in these companies. It will be possible in the Corporation accounts, without any breach of the Companies Act, to cover up losses and to cover up concealed subsidies. I am not going to repeat the whole argument I addressed to the House earlier, with which your Lordships were good enough to agree. This is vital, because it would be perfectly possible for this great nationalised complex to sell steel dearly and something else very cheaply and at the same time show an overall profit. Adopting the admirable precedent of the noble Lord, Lord De L'Isle and Dudley, I pray in aid the words of that major prophet of the Labour Party, Lady Passfield.
LORD PAKENHAM: Mrs. Sidney Webb.
VISCOUNT SWINTON: Mrs. Webb, as we all knew her. I hope I shall not be met with the argument that an ordinary company can present its accounts in this way. I am sure the noble Lord, Lord Pakenham, will not meet me with that argument, because in the penultimate Amendment he said we must not treat these companies as if they were ordinary companies. I agree with him. Now that we are to have a vast monopoly it is important that we should know what it is doing. Our money is invested in it, and we have an interest in it. It has a great many competitors and we want them to have fair treatment, as we want to have fair knowledge. Certainly there can be no argument about the public interest, national interest, or general interest, whatever you like to call it, because all these interests alike require that there should be a full and proper disclosure. Therefore, I submit to your Lordships that these words certainly ought to go out. The words we propose to leave out are:
"but so that where group accounts within the meaning of that Act are prepared by any company it shall not be necessary for a copy of the accounts of any subsidiary dealt with in those group accounts to be sent to the Minister."
I should have thought that disclosure of the results of separate activities would have been in the Bill. I thought it was common form in nationalisation measures. We had it in transport, in coal and in gas. The Government readily agreed to it in the Transport Act. We are to have separate statements on railways, buses, hotels and so on. If that was desirable in transport, it is infinitely more important here, where it is essential that the public, the owners, the taxpayers, who have to subsidise the Corporation if there is a loss, should know how the different main activities are going. If we do not know, we do not know whether subsidised competition is going on. I am sure I need not press this any more, because I am certain that the Government will accept this part of the Amendment. If they have already given it to us in nationalised industries where there is no competition, and only benefit or otherwise to the unfortunate consumer, a fortiori they ought to give it to, us in this industry where there is the keenest
740
competition. With the greatest confidence, I beg to move this Amendment.
Amendment moved—
Page 44, line 26, leave out from ("1948") to end of line 30.—(Viscount Swinton.)
LORD PAKENHAM: I followed the noble Viscount's argument very closely. As regards the first Amendment, may I venture to suggest that the noble Viscount, who so often uncovers hidden truths, has here discovered a mare's nest? There is a strong technical or administrative argument for the Bill as it is now drafted, and there is no argument of substance against it, as I think the noble Viscount will realise in a moment—I am dealing now with the noble Viscount's first Amendment. The grounds can be briefly summarised, as I know the Committee are anxious to make progress. Under the Companies Act, which we were asked to observe a few moments ago, group accounts only of the kind we are suggesting need be placed before the shareholders of a holding company. So here we are in line with the Companies Act. Then I come to the question of bulk. It would be troublesome to have even eighty accounts to publish—which we shall have—and it would really be an infernal nuisance, if I may use that expression, if we had 225, or it may be more, to publish. This is the real point which I would commend to the noble Viscount, and which I think has escaped him. The accounts of each of the publicly-owned companies will be filed with the Registrar of Companies. That is an important point, if I may say so. Therefore, there is no question of there being any mystery about these accounts; they will be available to anybody who chooses to go to the Registrar. May I suggest, therefore, that if we could form an opinion on this first Amendment, the noble Viscount, in the light of that indication of the facts, may agree to withdraw it?
VISCOUNT SWINTON: I do not want to be unreasonable, but I cannot withdraw this Amendment. I think we must make the most meticulous examination of how this will work. The noble Lord said what a difficult thing it would be to have to produce 225 accounts. I do not think it is. After all, there are tens of thousands of companies in this country to-day, all producing their accounts to

741
their shareholders. It is not as if the Government were economising in paper. We have a number of Government publications. If the Government feel they wish to make a slight economy in paper, there is the Government propaganda department which is costing a good many millions and issuing a good deal of paper. Perhaps we could do a little exchange by saving a little on that and publishing accounts which people in this country will want to see. I know the argument about group accounts, and I made it in advance, as the noble Lord admits.
LORD PAKENHAM: Not the point I have just mentioned.
VISCOUNT SWINTON: Yes, I did. I said that an ordinary company could present its group accounts in this way.
LORD PAKENHAM: I see that point. I am sorry.
VISCOUNT SWINTON: I said it in opening. I am going to be perfectly frank. I think we should have the fullest possible information about the Corporation—the ninety-four main Companies and the subsidiaries—and I think it is a very small thing to ask the Government to give us those accounts with full information in this hazardous venture on which we are asked to embark. I am sorry, but we must have the fullest information.
LORD PAKENHAM: May I just say before the Committee go to a Division—

Resolved in the negative, and Amendment agreed to accordingly.

if that is intended—that it is clear to me that the noble Viscount was under a complete misapprehension in his opening remarks, because I do not think—I shall be corrected if I am wrong—he was aware that the accounts of each of the publicly-owned companies would be filed with the Registrar of Companies.
VISCOUNT SWINTON: Of course I was aware of that, and I know what filing with the Registrar of Companies means. But are people really to be required to pay half a crown and search the Register? I do not think that is in the least an answer to this problem. When the Government want to publicise things, they do not say: "Go and pay half a crown and go to the Registrar of Companies"—they take millions of the taxpayers' money to get their own publicity.
LORD PAKENHAM: I think the noble Viscount's remarks will look very strange when we return to his opening in Hansard, because it is obvious that he was accusing us of trying to hide something. But it is clear that we are hiding nothing. For my part, and for the Government, we shall be pleased to meet the noble Viscount in Division or anywhere else.
On Question, Whether the said words shall stand part of the Bill?
Their Lordships divided: Contents, 18; Not-Contents, 46.

CONTENTS

Jowitt, V. (L. Chancellor.)

Stansgate, V.

Marley, L.

Macdonald of Gwaenysgor, L.

Addison, V. (L. Privy Seal.)

Amnion, L. [Teller.]

Morrison, L. [Teller.]

Crook, L.

Nathan, L.

Huntingdon, E.

Hare, L.(E. Listowel.)

Pakenham, L.

Holden, L.

Pethick-Lawrence, L.

Hall, V.

Kershaw, L.

Strabolgi, L.

Williams, L.

NOT-CONTENTS

Cholmondeley, M.

Swinton, V.

Layton, L.

Exeter, M.

Llewellin, L.

Reading, M.

Amherst of Hackney, L.

Lloyd, L.

Willingdon, M. [Teller.]

Ashton of Hyde, L.

Mancroft, L.

Balfour of Inchrye, L.

Middleton, L.

Albemarle, E.

Balinhard, L. (E. Southesk.)

Moynihan, L.

Buckinghamshire, E.

Barnby, L.

O'Hagan, L.

De La Warr, E.

Carrington, L.

Raglan, L.

Dudley, E.

Cherwell, L.

Rea, L.

Dundonald, E.

Clanwilliam, L. (E. Clanwilliam.)

Remnant, L.

Fortescue, E. [Teller.]

Ritchie of Dundee, L.

Iddesleigh, E.

Clydesmuir, L.

Rochdale, L.

De L'Isle and Dudley, L.

Sandhurst, L.

Bridgeman, V.

Fairfax of Cameron, L.

Teynham, L.

Falmouth, V.

Gifford, L.

Tweedsmuir, L.

Portman, V.

Hawke, L.

Waleran, L

Ridley, V.

Hindlip, L.

VISCOUNT SWINTON: I beg to move.
Amendment moved—
Page 44, line 39, at end insert—
"( ) The accounts of each publicly-owned company shall give or be accompanied by a statement giving separate information as respects each of the principal activities of the company and as far as may be the financial and operating results of each such activity."—(Viscount Swinton.)
LORD PAKENHAM: The noble Viscount has already spoken to this Amendment briefly but vigorously, and the issues very close to it were discussed earlier in the evening. Therefore, if the House agrees I will make only a few observations about it—and indeed they will be few. I would point out that the request for separate information in respect of each of the principal activities of the company is likely to be met under other clauses—under subsection (5) of Clause 38, and under Clause 35—but I agree that there is a request here for financial and operative results of activities which are not promised as the Bill now stands. I would have liked to reply at greater length to the noble Viscount's perfectly true suggestion that provisions on the lines of the Amendment are to be found in other Acts, but I would say briefly that here we have a task which would be much more complex than any other comparable task. At any rate we take the view that the task would be a great deal more complex.
I would, however, like to lay main stress on a point mentioned earlier by the noble Viscount. There is undoubtedly a real difficulty if we try to give results of this character. It may be that these results would be of assistance to foreign competitors. Civil Aviation is an instance. We have examined the possibility of publishing results of this kind, and I have felt hitherto that it would be easy enough; but there is an artificial element when we attempt to allocate at Headquarters the expenses, for instance, of the Welsh services. I feel it would be impossible, artificial, and not in the national interest to do this in the case of our overseas activities. A good deal of attention should be paid to the international aspect. The impossibility of doing this was set out earlier by my noble friend the Leader of the House. Therefore, with that strong and. I hope, friendly protest, I say we shall not divide, since the House
744
revealed its attitude a few minutes ago, and the process of conversion would be rather miraculous if noble Lords were to vote differently at this moment. Therefore I say that we shall fight this Amendment to the end in all constitutional ways, but we will not divide against it to-night.
On Question, Amendment agreed to.

REPRESENTATION OF THE PEOPLE BILL [H.L.]
Reported from the Joint Committee on Consolidation Bills, with Amendments, and re-committed to a Committee of the Whole House.
CIVIL AVIATION BILL [H.L.]
Reported from the Joint Committee on Consolidation Bills, with an Amendment, and re-committed to a Committee of the Whole House.
RHODESIA RAILWAYS LIMITED (PENSION SCHEMES AND CONTRACTS) BILL [H.L.]
Reported, with Amendments.
  PAYMENTS UNDER A MISTAKE OF LAW
  PAYMENTS UNDER A MISTAKE OF LAW