Sitting of 28 March 1950

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

  SUMMER TIME
  The VICE-CHAMBERLAIN OF THE HOUSEHOLD (MR. POPPLEWELL) reported His Majesty's answer to the Address, as follows:
  I have received your Address praying that the Summer Time Order, 1950, be made in the form of the Draft laid before Parliament, in pursuance of the provisions of Section 2 of the Summer Time Act, 1947.
  I will comply with your request.

PRIVATE BUSINESS
  BOOTLE EXTENSION BILL (By Order)
    CARDIFF EXTENSION BILL (By Order)
    Second Reading deferred till Thursday.
ILFORD CORPORATION BILL (By Order)
  LUTON CORPORATION BILL (By Order)
    NEWPORT EXTENSION BILL (By Order)
    Second Reading deferred till Tuesday next.
OLDHAM EXTENSION BILL (By Order)
  SUNDERLAND EXTENSION BILL (By Order)
    WOLVERHAMPTON CORPORATION BILL (By Order)
    Second Reading deferred till Thursday.

    VIVISECTION (PETITION)
    Mr. Peter Freeman: I beg to present a humble Petition. The Petition sheweth that there have been 23 million experiments on living animals during the present half century. More than one million of these have been for the purpose of cancer research alone, yet the actual number of deaths, as well as the percentage of mortality, from this dread disease have increased every year during the same period of 50 years, and are now
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    more than double the number at the beginning of the century. Your petitioners therefore pray:
    "Believing vivisection, with or without anaesthetics, to be morally unjustifiable, scientifically useless, dangerous and demoralising to the community, earnestly pray this Honourable House to pass a Bill withdrawing the sanction of the law from this practice."
    This Petition has been presented to this House every year for over 20 years, and I now ask that some further inquiry into the usefulness or otherwise of such experiments as are carried on behind closed doors, with no public report, information or accounts available, even to Members of this House, be now made.
    To lie upon the Table.

ORAL ANSWERS TO QUESTIONS

  WAR PENSIONS AND ALLOWANCES
  Mr. William Rossasked the Minister of Pensions the total cost to the Exchequer, to the nearest convenient date, of improvements in war pensions and allowances, including pensions and allowances to dependants, made since August, 1945; the annual cost at present of continuing these improvements; and what proportion does the annual cost of these improvements bear to the total annual cost of war pensions and allowances.
  The Minister of Pensions (Mr. Marquand): The total cost to the Exchequer to 31st December, 1949, of the improvements in war pensions and allowances, including pensions and allowances to widows and dependants, made since August, 1945, is approximately £35,250,000. The annual cost at present of continuing these improvements is approximately £11,500,000. This represents just over 14 per cent. of the total annual cost of war pensions and allowances. These figures are confined to pensions and allowances and therefore do not include the cost of motor cars.
  Mr. David Renton: Will not the right hon. Gentleman agree that the advantage of these increases has been largely outstripped by the fact that the Government have reduced the value of the people's money since 1945?
  Mr. Marquand: Certainly not.

  BRITISH ARMY

    Foreign Legion
    Mr. Julian Ameryasked the Secretary of State for War whether, having regard to the continued difficulties encountered in recruiting for the Regular Army, he will now consider the desirability of raising a foreign legion.
    The Secretary of State for War (Mr. Strachey): This matter has already been carefully considered, and it has been decided that a foreign legion would be unsuitable for most of the tasks which have to be carried out by British troops, particularly where these are concerned with the maintenance of law and order.
    Mr. Amery: Am I not right in believing that the last time a decision was taken it was on the political grounds that to raise a foreign legion would offend the susceptibilities of the Soviet Union, and has not the position changed so markedly that the whole question can now be reconsidered?
    Mr. Strachey: No, Sir. I think that these were always the grounds on which a decision was taken, and that they remain.

    Weedon Ordnance Depot (Fire)
    Mr. Manningham-Bullerasked the Secretary of State for War the estimated number of rifles destroyed or damaged beyond repair, and the estimated financial loss resulting from the recent fire at Weedon Ordnance Depot; and whether he can give any information on the cause of the fire.
    Mr. Strachey: This very grave fire destroyed some 165,000 rifles and 5,000 Sten guns, the majority of which were awaiting repair. A preliminary estimate of the financial loss is £1 million. A court of inquiry will be held on 30th March. Investigations by the Special Investigations Branch and by the Northamptonshire County Police have produce no evidence that the fire was other than accidental.
    Mr. Manningham-Buller: Is it not the case that all electric current is cut off at about 5.30 p.m. and no smoking is allowed in this ordnance depot, and that the fire was first discovered at 3 a.m., or thereabouts?
    Mr. Strachey: We had better await the results of the court of inquiry. I rather emphasise the gravity of the situation.
    Earl Winterton: In view of the great gravity of this event, which the right hon. Gentleman has just admitted, will a full report of the findings of the inquiry, and possibly the evidence, be laid upon the Table of the House, or issued as a White Paper?
    Mr. Strachey: I should like to have notice of that.
    Lieut.-Commander Gurney Braithwaite: In view of the possibility of sabotage, has the right hon. Gentleman satisfied himself that there are no persons employed in this depot who in the past have expressed Communist sympathies?
    Mr. Strachey: No, Sir.
    Mr. Manningham-Buller: Will the right hon. Gentleman take steps to see that it is a very high-powered court of inquiry that is appointed?
    Mr. Strachey: Certainly.

    Camps (Bread Contracts)
    Mr. McKieasked the Secretary of State for War why the contracts for the supply of bread to Cairnryan and Wig Bay camps, near Stranraer, are to be given to an Ayr firm as from 1st April, and if he will cancel this arrangement and give the contracts to the Stranraer firms as previously done, thus maintaining the principle that such camps should be locally supplied.
    Mr. Strachey: The local competition for contracts for the supply of bread to Cairnryan and Wig Bay camps is inadequate, and contractors outside the immediate area were accordingly invited to tender. The contract was awarded to the lowest tenderer. There are no grounds for awarding contracts to local firms in such circumstances at additional expense to public funds.
    Mr. McKie: Is the right hon. Gentleman aware that this decision will give great dissatisfaction in the area, especially to the firms who have been supplying these camps with bread for some time? Will he, at any rate, allow them to have an allocation to supply bread even if they are unable to supply the whole amount?
    Mr. Strachey: I cannot understand the contention that a Minister should not give the contract to the lowest tenderer.
    Lieut.-Colonel Sir Thomas Moore: In disputing this monstrous suggestion of my hon. Friend, was not this contract given because the firm is more competent to carry it out satisfactorily?

    Ex-Soldiers' Families (Droitwich)
    Mr. George Wardasked the Secretary of State for War whether he is aware that the housing shortage in Droitwich is being gravely aggravated by the families of repatriated soldiers who are discharged from No. 15, Families Camp, Norbury House, and seek other accommodation in the town; and what steps he is taking to assist the local authority in this matter.
    Mr. Strachey: The shortage of accommodation for the families of serving soldiers makes it impossible for my Department to accept any part of the responsibility for housing ex-soldiers and their families. But if there is anything which we can properly do to help local authorities, we will do it.
    Mr. Ward: Is the Minister aware that Section 21 of the National Assistance Act, 1948, does not apply because the need in these cases should reasonably have been foreseen, and that therefore the local authority cannot be held responsible? Will the Minister consult with the Minister of Health to see whether the allocation of houses in the Droitwich area cannot be increased to meet this extra need?
    Mr. Strachey: It is by action along these lines that we can in some cases meet the situation, and we shall certainly try to do so in this case.

    Norbury House Hotel, Droitwich
    Mr. Wardasked the Secretary of State for War when the Norbury House Hotel, Droitwich, is to be released by his Department.
    Mr. Strachey: Norbury House Hotel is used for housing the families of serving Regular soldiers who in most cases would otherwise be homeless. I cannot say when it will be possible to release this property.
    Mr. Ward: Is the Minister aware that this hotel is urgently required by the Midland Regional Hospital Board as a new hospital, and that because Droitwich is a spa there are many advantages in having a new hospital there? Will he bear this in mind and try to release this hotel as soon as possible?
    Mr. Strachey: Certainly.
    Mr. Wardasked the Secretary of State for War what action he is taking in the case of Mrs. Donald, No. 15, Families Camp, Norbury House, Droitwich, particulars of which have been sent to him.
    Mr. Strachey: Mrs. Donald was discharged from employment on the staff of this camp in February, 1950, as she was surplus to the establishment. I am afraid that she must, therefore, be required to vacate the staff accommodation she now occupies in the hotel. But I am taking up the matter with my right hon. Friend the Minister of Health. She will not be required to vacate her room pending these inquiries.

    Store Keepers, Canal Zone
    Mr. McAddenasked the Secretary of State for War what is the rate of pay for locally recruited British subjects in the Canal Zone, employed as supervising store keepers, grade two, class one.
    Mr. Strachey: From £32 to £35 10s. a month.

    Surgeons, Malaya and Singapore
    Mr. Irvineasked the Secretary of State for War the number of British Army surgeons now serving in Malaya and Singapore; and whether he is satisfied that such number is sufficient.
    Mr. Strachey: There are seven British Army surgeons serving in Malaya and Singapore. They are available to fly to any locality where their services may be needed. This is an addition of three Royal Army Medical Corps surgeons to the numbers previously serving in Malaya and Singapore. I am keeping the requirement under careful review. There are, in addition, 16 European civilian surgeons in Malaya and Singapore who can be, and are, called on should Army surgeons not be immediately available.
    Mr. Irvine: While thanking my right hon. Friend for that answer and recognising the improvement which has occurred, will my right hon. Friend bear in mind that the numbers in his reply struck many Members as extremely small, having regard to the evidence of the countless lives that can be saved by surgeons working forward with military units?
    Mr. Strachey: I will bear that in mind.
    Mr. Somerville Hastings: Is my right hon. Friend convinced that these seven surgeons are men of experience and repute?
    Mr. Strachey: Yes, Sir, I have no reason to suppose that they are not. They are Regular surgeons serving in the R.A.M.C.
    Commander Noble: Can the right hon. Gentleman say whether there has been any recent request from Malaya for more surgeons?
    Mr. Strachey: Yes, Sir, and these three additions meet the requests.

    Seaforth Highlanders (Awards, Malaya)
    Mr. Emrys Hughesasked the Secretary of State for War how many soldiers of the Seaforth Regiment have now been awarded medals for bravery in Malaya.
    Mr. Strachey: Two officers and five other ranks of the Seaforth Highlanders have received awards for bravery in Malaya. Seven officers and six other ranks have been mentioned in despatches.
    Mr. Hughes: Is the Minister aware that one of these five other ranks is now living under housing conditions which he has said are worse than the jungle?
    Mr. Speaker: The Question is about how many soldiers have been awarded medals and not about housing conditions.
    Sir Ian Fraser: Will the right hon. Gentleman consider publishing the awards made to all regiments in Malaya, since all are equal in valour?

    Compassionate Leave
    Mr. Leslie Haleasked the Secretary of State for War whether he is now prepared to reconsider his decision to
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    refuse extension of compassionate leave, or to grant compassionate release to Private Grace Wrigley, whose mother is gravely ill and who is needed to care for brothers aged nine and 15 years.
    Mr. Strachey: I have looked carefully into this case, but regret that I must confirm this decision.
    Mr. Hale: Does my right hon. Friend dispute the facts as set out in the Question? Is he aware that this lady enlisted for only two years and has already served 18 months? As this will cause the greatest possible hardship, will he not consider the matter?
    Mr. Strachey: I looked into the family circumstances as carefully as I could, and from the evidence available it seems possible for the family to meet the circumstances and hire domestic help. If my hon. Friend has any further evidence to put before me, I am very ready to consider it.
    Mr. Hale: Will my right hon. Friend consider a short extension while the evidence can be submitted?
    Mr. Strachey: Perhaps we could look at it this week.

  TOWN AND COUNTRY PLANNING

    New Towns
    Mr. Braineasked the Minister of Town and Country Planning the number of officials employed by each of the new town corporations; the salaries paid; and the total figure of administrative cost to date of each corporation.
    The Minister of Town and Country Planning (Mr. Dalton): The desired information is given in the Annual Reports of the Corporations, published as House of Commons papers Nos. 113 and 236 of 1949.
    Mr. Braineasked the Minister of Town and Country Planning when the master plan of the Basildon new town will be made public; and whether such plan will show in detail the freehold properties which the Corporation propose to acquire.
    Mr. Dalton: I cannot yet name a date, but I am asking the chairman to lose no

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    time in preparing this plan. The answer to the last part of the Question is, "No, Sir."
    Mr. Braine: Is the Minister aware that there is genuine anxiety in the designated area in regard to the intentions of the Corporation; that many freeholders fear the loss of their freeholds; and what assurance can the Minister give that if freehold property has to be acquired by the Corporation a fair market price will be paid?
    Mr. Dalton: The plan, of course, shows the areas that are designated for housing, open spaces and so forth, but before any freehold properties are sought to be acquired by the Corporation, notice will be given and full opportunity for objections will be afforded. I will watch the matter carefully myself in the light of the undertaking that was given by my predecessor that as far as possible the early developments will take place on open land and not on land already occupied.
    Mr. Derek Walker-Smith: Will the right hon. Gentleman undertake that during his administration in this office more regard will be paid to the rights of people living in the areas than has hitherto been the case?
    Mr. Dalton: We will take all interests into due and fair consideration.
    Mr. Braineasked the Minister of Town and Country Planning how many new houses are now ready for occupation in each of the new towns; and the rents being charged.
    Mr. Dalton: As the reply contains a number of figures, I will, with permission, circulate it in the OFFICIAL REPORT.
    Earl Winterton: Will the right hon. Gentleman say to whom Members of Parliament, in whose constituency new towns are to be constructed—as in the

    Town

    Number of Houses Completed

    Weekly Rents (exclusive of rates)

    2-Bedroom

    3-Bedroom (various types)

    4-Bedroom

    Aycliffe

    …

    …

    59

    17s. 0d.

    20s. 6d.

    —

    Crawley

    …

    …

    36

    15s. 0d.

    23s. 3d. to 25s. 0d.

    28s. 0d.

    Harlow

    …

    …

    31

    —

    21s. 6d. to 25s. 11d.

    —

    Hemel Hempstead

    …

    12

    22s. 0d.

    22s. 6d. to 27s. 0d.

    30s. 0d

    Stevenage

    …

    …

    20

    12s. 6d. to 25. 0d.

    —

    —

    case with me—should apply when they wish to raise questions of housing grievances? Should they write to the Chairman of the Development Corporation, or put a Question to the right hon. Gentleman in this House?
    Mr. Dalton: I should not like to give a snap answer to that. If the noble Lord will be kind enough to let me know by letter or orally any case which he has in mind, I shall be able to advise him on the best procedure.
    Mr. Henderson Stewart: Does the right hon. Gentleman's reply to the last Question and to Question 13 include Scotland or not?
    Mr. Dalton: No, Sir.
    Mr. Vane: Could the right hon. Gentleman reply to the last part of this Question, and give us some idea of the rents that are being charged?
    Mr. Dalton: I am proposing to circulate them in the OFFICIAL REPORT. There are four columns of figures, and if the hon. Gentleman will study them and has then any questions to put, I will consider them.
    Mr. Braine: Is the right hon. Gentleman aware that in Hemel Hempstead the rents charged are between 30s. and 31s. 6d; that in the particular designated area of Basildon there are many old age pensioners and others with small incomes living in their own freeholds at the moment who are quite incapable of paying such rents as these, and can the right hon. Gentleman give them some assurance on the matter?
    Mr. Dalton: Perhaps the hon. Gentleman will be kind enough to study first what I am circulating in the OFFICIAL REPORT.
    Following is the reply:
    Mr. Maudlingasked the Minister of Town and Country Planning what action he proposes to take on the Report made to him by the Joint Committee on financial arrangements between local authorities and the new towns corporations.
    Mr. Dalton: None, Sir. The proposals in this Report were not generally acceptable either to the new town corporations or to all the local authorities, and direct negotiation between particular authorities and corporations will take place, whenever necessary.
    Mr. Maudling: Will the right hon. Gentleman bear in mind the difficulties of such local authorities as the Hertfordshire County Council, which have to engage separately with four new towns, the L.C.C. and the authorities who represent the expanding towns?
    Mr. Dalton: We will try to simplify the procedure if we can.

    Land (Change of Use)
    Mr. Bossomasked the Minister of Town and Country Planning whether, as the amount to be paid to the Government when a change of use for certain land is undertaken is arrived at by no scientific method but by a process of bargaining, he will eliminate this anomaly where the land is to be used for houses to be built to cost less than £1,500.
    Mr. Dalton: I do not accept the statement in the first part of the hon. Member's Question, and I am not at present prepared to adopt the proposal in the second part. But I have asked the Chairman of the Central Land Board to make suggestions to me, as soon as possible, for administrative simplifications and improvements.
    Mr. Bossom: Will the right hon. Gentleman outline in the OFFICIAL REPORT the scientific method whereby these charges are made, because no one knows how this scientific reasoning is made up or how the amount is arrived at?
    Mr. Dalton: I do not think it would be appropriate to circulate it in the OFFICIAL REPORT, but perhaps at a later stage we can discuss it.
    Mr. Walker-Smith: Would the right hon. Gentleman draw the attention of the Chairman of the Central Land Board to the wide variations that seem to follow the application of the scientific method?
    Mr. Dalton: I have asked him to advise me on all these matters.

    Forms
    Sir Waldron Smithersasked the Minister of Town and Country Planning what forms have to be filled up before permission is granted by the county surveyor to move a gate or change agricultural access to a field; and what is their cost.
    Mr. Dalton: Such forms are settled by local planning authorities and I have no information about their cost, but I have a suspicion that a good deal of this sort of complication could be done away with, and I hope soon to take steps to this end.
    Sir W. Smithers: Is the right hon. Gentleman aware that the facts in this Question are typical of the loss of money caused by the folly of centralised administration under a Socialist Government, and will the right hon. Gentleman try to do away with them as soon as possible and save the taxpayer all this form-filling as well as the cost of the bureaucrats involved?

  NATIONAL INSURANCE

    Seasonal Workers
    Sir Ian Fraserasked the Minister of National Insurance if she is now in a position to make a statement on the rates and conditions of unemployment benefit and old age pensions for seasonal workers.
    The Minister of National Insurance (Dr. Edith Summerskill): I am hoping shortly to submit draft regulations about seasonal workers to the National Insurance Advisory Committee.
    Sir I. Fraser: Can the right hon. Lady say when it will be possible to answer this Question?
    Dr. Summerskill: I should not like to commit myself to a date, but I hope to get this question of seasonal workers settled before the winter, which is so important to them.

    Sickness Benefit Claim
    Commander Nobleasked the Minister of National Insurance whether she is aware that it has taken one year to settle a claim, ZE 826538 B, for sick benefit for 5th February to 7th March, 1949; and what steps she is taking to prevent such delay.
    Dr. Summerskill: Personal sickness benefit was paid at the time of the claim. The delay occurred in connection with a claim for dependants' increase and was due to exceptional circumstances, about which I have written to the hon. and gallant Member.

    Assistance
    Mr. Llewellynasked the Minister of National Insurance whether she has considered the case of the late Mrs. Annie Corley, of Coventry, details of which have been sent her; and, in view of the report of the Home Office pathologist that her death was accelerated by starvation, exposure and neglect, what steps she will take to prevent the recurrence of such cases.
    Dr. Summerskill: This tragedy might have been averted if Mrs. Corley had applied to the National Assistance Board for help. Every effort is made to inform the public about the assistance service. The address of the Board's local office is shown in every Post Office and posters are put up in our offices and in Employment Exchanges.
    Anyone in need of assistance can apply for it either in person at the nearest local office of the Board, or by post on a simple form obtainable at any Post Office, and such applications are always dealt with as urgently as necessary. I hope this Question and answer will help to make the existence of the service still more widely known.
    Mr. Llewellyn: Would the Minister consider arranging a series of broadcasts so that the full provision of the social services may be known to the general public?
    Dr. Summerskill: As I have explained to the hon. Gentleman, we are making every effort to make this widely known, but we are doing something else which I should have mentioned, and that is including information about the Assistance
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    Board in the books of the pensioners in the future.
    Mr. Sydney Silverman: Has my right hon. Friend formed any estimate of the number of persons whose death was accelerated by starvation, exposure and neglect between 1920–1940?
    Mr. Speaker: That is another question.

    Widows' Pensions
    Lieut.-Colonel Sir Walter Smilesasked the Minister of National Insurance what would be the approximate cost if all widows over 50 years of age, whose husbands were insured, received a pension of 26s. per week, instead of only those widows whose husbands died after July, 1948.
    Dr. Summerskill: The approximate additional cost of amending the National Insurance Act to provide a pension of 26s. for all widows over the age 50, whose husbands were insured, would be £8 million in the first year. I would remind the hon. and gallant Member that pensions of 26s. are paid to many women widowed before July, 1948.

    New Entrants (Aliens)
    Mr. Russellasked the Minister of National Insurance how long it is proposed to continue the arrangement by which persons entering the United Kingdom from countries with which no reciprocal arrangements have been made, are compelled to have their insurance dated from 5th July, 1948.
    Dr. Summerskill: Persons entering this country from abroad for the first time fall under the general rules governing new entrants to insurance. It is not proposed to make any special rules for such cases otherwise than on a basis of reciprocity.
    Mr. Russell: Does this not mean that many contributors will only get comparatively small pensions, and will she consider giving them the option of having their contributions returned as a lump sum with interest instead of a pension?
    Dr. Summerskill: Certain contributors can have their contributions returned, but I must remind the hon. Gentleman that this scheme was designed originally on an actuarial basis, which took into consideration the contributions which would

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    be made by practically every worker in this country from school-leaving age until retirement age. If a large number of people are introduced into the scheme at this stage, without those considerations being kept in mind, then the whole balance of the scheme will be upset.

    Reciprocal Arrangements
    Mr. Russellasked the Minister of National Insurance when reciprocal arrangements will be completed with the Dominions, and other parts of the Empire, including the Channel Islands, for the benefits of National Insurance to be interchangeable.
    Dr. Summerskill: The possibility of making reciprocal arrangements depends on the nature of the social service provisions in the country concerned. An agreement on family allowances has been made with New Zealand, and negotiations for other agreements are proceeding with Australia and New Zealand.

    Contributions (Schedule Payments)
    Mr. Perkinsasked the Minister of National Insurance whether the experiment of paying National Insurance contributions without the use of adhesive stamps or impressing machines is proving successful; and if she proposes to make it universal.
    Dr. Summerskill: I assume the hon. Member is referring to the system of payment by schedule which is still in the experimental stage. This system is only adapted for use by employers with a large number of regular employees and could never be made universal.

  EMPLOYMENT

    Liverpool
    Mr. Keenanasked the Minister of Labour the numbers of unemployed building trade workers registered in Liverpool at the end of December, 1949, and the end of February, 1950, respectively.
    The Minister of Labour (Mr. Isaacs): The figures were 1,791 at 5th December and 2,142 at 13th February. Figures are not available for the end of any month.
    Mr. Keenan: Can my right hon. Friend say what percentage of the unemployed at those dates were trained men, as against labourers?
    Mr. Isaacs: I could not say offhand, but I shall be very glad to get the information and send it to my hon. Friend.
    Mr. Keenanasked the Minister of Labour the numbers of unemployed ship-repair workers registered in Liverpool at the end of December, 1949, and the end of February, 1950, respectively.
    Mr. Isaacs: Separate figures are not available for the ship-repairing industry, but for the shipbuilding and ship-repairing industry as a whole the figures were 2,496 at 5th December and 3,171 at 13th February.
    Mr. Keenan: Can the Minister tell me whether any progress has been made with the inquiry into ship-repairing?
    Mr. Isaacs: No, Sir, I cannot say that we are in a position to give any definite result of the inquiry, but my hon. Friend and the House will recall that this is an inquiry to cover the whole of the ship-repairing and shipbuilding area. As soon as I get information I will let the House have it.
    Mr. Porter: Is there any duplication in registration, in view of the fact that men of the same trade work in other industries?
    Mr. Isaacs: There may be a little duplication, but there is not likely to be much.
    Mr. Keenanasked the Minister of Labour how many bricklayers were registered as unemployed in Liverpool at the end of October, 1949, the end of December, 1949, and the end of February, 1950, respectively.
    Mr. Isaacs: The figures were 43 at 15th October, 41 at 5th December, and 76 at 13th February.
    Mr. Keenan: Will my right hon. Friend note that we have had an inquiry made in the area whether the difficulty in the trade is due to the shortage of bricklayers, and that some firms are not making the necessary applications for labour?

    Bank Employees (Union)
    Mr. H. Hyndasked the Minister of Labour why he has refused to meet a deputation from the National Union of Bank Employees, led by the hon. Member for Accrington, to discuss the refusal of the Banque Belge pour l'Etranger to recognise the union.
    Mr. Isaacs: As I explained to my hon. Friend, this matter has been the subject of discussions between my Department, and representatives of the bank and the union. I regret that it has not been possible to secure any arrangement mutually satisfactory to the parties, but I do not think that this is a matter in which I can usefully intervene.
    Mr. Hynd: Is my right hon. Friend aware that it is precisely because this matter has been the subject of unsuccessful talks between his divisional officer and the union that I am troubling him personally with it? Will he not use his influence with this bank to persuade them that when an organisation represents the majority of the staff, it is entitled to recognition?
    Mr. Isaacs: I do not question the facts at all. Our regional officer has met both parties on several occasions and he is endeavouring to secure a conference between them. At the moment it is the bank which has declined the meeting. I will see whether I can use any influence I have.
    Mr. Arthur Lewis: Will my right hon. Friend consider amending the National Arbitration Order so as to include questions of trade union recognition in matters which can be sent to the tribunal for settlement?
    Mr. Isaacs: That is quite another question, and I would like to consider it before I express an opinion.
    Mr. Boyd-Carpenter: In view of the acceptance by the right hon. Gentleman of the principle put forward by his hon. Friend behind him, will he now invite the Postmaster-General to pay attention to that principle?

    Aircraft Factory, Langar
    Mr. Ian Winterbottomasked the Minister of Labour if he is aware that as a result of a reduction in Government
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    orders placed with the aircraft construction industry, the Langar depot of the firm A. V. Roe Limited will be closed shortly, and what action he is proposing to take to ensure that the skilled labour force at present employed there is not dispersed and thus wasted
    Mr. Isaacs: I understand that the firm in question has sufficient work at present for the Langar factory to last until the end of the year.
    Mr. Winterbottom: Will my right hon. Friend bear in mind that the value of the production team is greater than that of its individual members and give every encouragement to keeping that team in being?
    Mr. Isaacs: It is not a question of keeping the team in being, but of whether the firm has enough work to carry on with. Should any of these skilled workers desire to leave or have to leave the firm, we shall have no difficulty in placing them elsewhere.

    Training Courses (Ex-Service Men)
    Mr. Niall Macphersonasked the Minister of Labour what vocational training courses are still available for men recently released from short-term postwar engagements in the Forces.
    Mr. Isaacs: I am sending the hon. Member a list of the 99 courses available for ex-Service men, under the vocational training scheme.
    Mr. Macpherson: To what extent do regional considerations determine the courses which are offered to any individual, and whether there is any possibility of his being employed locally? Can the right hon. Gentleman also say how long it is proposed to hold out courses to men engaged on short-term engagements?
    Mr. Isaacs: It would be more helpful if the hon. Gentleman were to put down this question. I have answered the Question on the Order Paper. One point I can answer straight away. It is that men who accept training in any industry do so on the distinct understanding that they will be mobile and be ready to take work wherever it is available.

    Dock Amenities (Report)
    Mr. Irvineasked the Minister of Labour whether he has now considered the Report of the National Dock Board on Dock Amenities; and what action he intends to take in regard to the recommendations in the Report.
    Mr. Isaacs: His Majesty's Government felt that in principle many of the recommendations made in the Report constituted a valuable basis for considering what action could be taken. They have not felt able to advocate, in existing economic and financial circumstances, the implementation of those recommendations which involve substantial capital expenditure, but within this limitation there are many real improvements that can be carried out by the responsible bodies. I am making inquiries with a view to finding out what progress has been made in the past year and what further improvements are likely to put in hand.
    Mr. Irvine: While thanking my right hon. Friend for that answer and recognising that something is being done in the matter, may I ask him to undertake to treat as a matter of primary urgency this question of amenities at the docks, in view of the appallingly bad conditions that the dockers have?
    Mr. Isaacs: I think it is right to say that both employers and dock authorities are anxious to clean up the bad state of affairs which has arisen at the docks.

    Disablement Resettlement Officers
    Mr. Hastingsasked the Minister of Labour how his disablement resettlement officers are trained; and what is the average duration of this training.
    Mr. Isaacs: The officers concerned who have had previous training and experience in employment work are given a full course of training to cover the various aspects of their duties as disablement resettlement officers, detailed particulars of which I will send my hon. Friend.
    Mr. Hastings: May I ask the average time that these courses take, and whether my right hon. Friend regards the time allowed as sufficient to train men for important work?
    Mr. Isaacs: Many disabled men have been placed in industry as skilled men, as a result of the training given to officers on these courses.
    Sir Herbert Williams: Are any courses available in training people to ask snappy supplementary questions?
    Mr. Isaacs: If there were, the hon Gentleman might undertake the course.

    Remploy Factories
    Mr. Hastingsasked the Minister of Labour how many Remploy factories are now in production and to what extent they are working to capacity.
    Mr. Isaacs: At 22nd March, 1950, Remploy Ltd., had 66 factories in production and were employing 4,211 disabled persons (4,101 men and 110 women) in their factories in addition to 222 home workers Some of the factory workers are still in training. Not all the factories are at present working to full capacity. In many cases they are still building up their labour force and trade connections. I am glad to say, however, that the volume of work being received from Government Departments, local authorities and commercial concerns is slowly increasing, and energetic efforts are being made to secure a greater flow of orders.
    Mr. Hastings: Is my right hon. Friend satisfied that the progress being made in these factories is such as might be expected at the present time?
    Mr. Isaacs: Yes, Sir. In the present circumstances we must be satisfied with the progress made. I may say that in addition to the 66 factories already occupied another six are completed and will be occupied very shortly, bringing our total disabled persons employed up to 6,584.
    Mr. Rankin: Is the Remploy factory in Glasgow now in production?
    Mr. Isaacs: I could not say without notice.

  SCOTLAND

    Housing
    Commander Galbraithasked the Secretary of State for Scotland what is the number of grants which have been made to persons other than local authorities for the improvement of housing accommodation under the provisions of Section 9 of the Housing (Scotland) Act, 1949; and the average amount of such grants.
    The Secretary of State for Scotland (Mr. McNeil): As local authorities deal with applications from private persons without reference to my Department, the information asked for is not available. I am, however, asking local authorities to submit a quarterly return of progress, the first to show the position at 31st March.

    Respiratory Tuberculosis
    Commander Galbraithasked the Secretary of State for Scotland what is the number of notifications in respect of persons suffering from pulmonary tuberculosis received in the years 1939, 1945, 1947, 1948 and 1949.
    Mr. McNeil: Notifications of respiratory tuberculosis in Scotland in 1939 numbered 4,657; in 1945, 7,316; in 1947, 7,984; and in 1948, 8,204. The provisional figure for 1949 is 8,427.
    Mr. Rankin: Can my right hon. Friend say whether the mortality rates have increased during the years mentioned in the Question?
    Mr. McNeil: No, Sir. My recollection is that the mortality rate for last year was down by about 10 per cent. compared with the previous year and it was the lowest mortality rate since 1939, although, of course, I am not attempting to suggest that the figures are at all satisfactory.

    Tenement Flats, Glasgow
    Mr. McGovernasked the Secretary of State for Scotland how many small tenement flats in Glasgow have been sold each year since July, 1945, to 1st March, 1950, respectively; how many have been requisitioned; and how many purchased by Glasgow Corporation under their powers.
    Mr. McNeil: I regret that no information is available as to the number of flats sold in Glasgow during the periods stated. As the answer to the remainder of the Question involves a number of figures, I propose, with permission, to circulate a statement in the OFFICIAL REPORT.
    Mr. McGovern: Is the Secretary of State aware that repeated promises were given in this House that the numbers of these flats which were being sold or
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    advertised were being watched by the local authority and also by the Scottish Office, and can he say why they have both fallen down on the job? Also, is he in favour of taking powers to bring all such houses that become vacant under the jurisdiction of the Glasgow Corporation so that they may allocate tenants from their own waiting lists to these vacant properties?
    Mr. McNeil: There are two points. First of all, notably due to the attentions of my hon. Friend, I too have tried to note this position, but that does not mean that complete figures are available. Secondly, as I have attempted to point out, there are certain powers available to local authorities.
    The following is the information:

    Period

    Number of small tenement houses*

    Requisitioned in the period and retained at the end of the period

    Acquired by the Corporation

    July, 1945-July, 1946

    22

    48

    July, 1946-July, 1947

    38

    —

    July, 1947-July, 1948

    25

    6

    July, 1948-July, 1949

    15

    196

    July, 1949-March, 1950

    —

    154

    Total

    100

    404†

    * Figures relate to houses of five rooms or less.

    † Of these 404 houses, 169 have been demolished and 235 have been or will be repaired.

    Mentally Defective Children
    Mrs. Cullenasked the Secretary of State for Scotland if he is aware of the lack of accommodation in Scotland for the care of mentally defective children; and what steps he is taking to ease the situation.
    Mr. McNeil: I regard the provision of additional accommodation for mental defectives as a matter of importance, but difficulties in supply of building labour and materials have prevented any substantial extensions, and the shortage of nursing staff has imposed a further limitation.
    Mrs. Cullen: Is my right hon. Friend aware that at the present time there are 117 such children on the waiting list in the City of Glasgow and that this is causing great concern to the local authority? These children are living in the worst slum areas of the city. Will my right hon. Friend give this matter his sympathetic consideration?
    Mr. McNeil: I am indebted to my hon. Friend, and I repeat that I am distressed about this problem. I should be glad to engage her assistance in trying to recruit staff because, apart from the building programme, we have accommodation specially designed for this type of patient and we are not able to use it at present because of staff shortages.

    Nurses' Salaries
    Mr. N. Macphersonasked the Secretary of State for Scotland whether he is aware of the anomaly caused by the recent Whitley Council award in regard to the salaries of the nursing profession under which sisters may receive a higher salary than the matrons under whom they are serving; and whether he will take steps to remedy this anomaly.
    Lord Malcolm Douglas-Hamiltonasked the Secretary of State for Scotland what steps he is taking to adjust the anomaly by which ward sisters are being paid more than matrons in Scottish hospitals.
    Mr. McNeil: As I explained last week in reply to the hon. and gallant Member for Perth and East Perthshire (Colonel Gomme-Duncan), a claim for increased salaries for senior hospital nurses is at present before the Nurses and Midwives Whitley Council. This claim includes matrons.
    Mr. Macpherson: Will the right hon. Gentleman give an assurance that the Government's White Paper on personal incomes will not be given as a reason for perpetuating this anomaly, as has taken place in the case of the public health nurses and domiciliary midwives?
    Mr. McNeil: I cannot, without notice, give such an assurance, but it must be plain that this claim is before the Whitley Council, and therefore no comment can appropriately be made by me.
    Commander Galbraith: Will the right hon. Gentleman took into the case of health visitors and particularly tuberculosis health visitors?
    Mr. McNeil: Certainly, Sir. I shall be glad to do that.
    Mr. McGovern: Has the Secretary of State any guarantee that both the hon. Members who have been asking questions about this will not, if my right hon. Friend puts the matter right, oppose the Supplementary Estimate in respect of it?

    Fishing Industry
    Mr. Henderson Stewartasked the Secretary of State for Scotland (1) what steps he is taking to compensate Scottish fishermen for the sharp rise in prices of all fishing gear; and
    (2) what representations have recently been made to him by the Scottish fishing industry; and what action he has taken in response to their plea for urgent measures to avoid a crisis in the trade.
    Mr. McNeil: Representations have been made to me recently by the Scottish fishing industry against the decontrol of fish prices, against the termination of the flat rate transport scheme for fish and the withdrawal of the present subsidy on near and middle water fish, and against the high cost of fishing gear. The position of the fishing industry at Aberdeen is being examined by the Departments concerned and the position of the inshore fishermen is being discussed with their representatives by the Scottish Home Department.
    Mr. Stewart: Is the right hon. Gentleman aware of the extreme urgency which is associated with this matter, and that, in the opinion of the leaders of the fishing industry, unless something is done quickly about most of these matters, a crisis will develop with which we may not be able to cope?
    Mr. McNeil: I have already taken part in discussion with representatives of the Aberdeen fishermen.
    Mr. Malcolm MacMillan: Is my right hon. Friend aware that this affects the fishing industry right round the coast? If he has not got the powers, will he seek powers to control this shocking exploitation of the ordinary fishermen by private enterprise?
    Captain Duncan: Will the right hon. Gentleman be able to announce the result of these consultations before Easter?
    Mr. McNeil: I should not like to be tied to a date. I have asked the Inter-Departmental Inquiry to expedite their business as much as possible.

    Teachers
    Captain Hamiltonasked the Secretary of State for Scotland how many honours graduate teachers left the teaching profession in Scotland in the last five years.
    Mr. McNeil: I regret that I am unable to give this figure.
    Captain Hamiltonasked the Secretary of State for Scotland how many teachers in Scotland were receiving a salary of less than £400 a year in 1949; and how many of these are university graduates.
    Mr. McNeil: Out of 29,722 qualified teachers employed by education authorities in Scotland on 31st March, 1949, 9,344, of whom 2,333 were graduates, were receiving a salary of less than £400 a year.
    Captain Hamilton: Does not the right hon. Gentleman agree that a university graduate is getting poor recompense if he is being paid under £400 a year? Will the right hon. Gentleman give us some indication of what steps he proposes to take to remedy this situation?
    Mr. McNeil: The submissions are before the National Joint Council on Teachers' Salaries just now, and I should not therefore be encouraged to comment at present.

    MALAYA (GOVERNMENT POLICY)
    Mr. Gammansasked the Prime Minister if he is aware that the anti-bandit campaign in Malaya is being hampered by the lack of a clear pledge by His Majesty's Government that the British do not intend to withdraw from Malaya; and if he will make a further statement of this subject which will put the issue beyond doubt.
    The Prime Minister (Mr. Attlee): I do not see that there can be any room for doubt. I gave a clear statement of His Majesty's Government's policy to the House on 13th April last, and it is our firm intention to implement the policy which I then affirmed of steady democratic progress towards self-government within the Commonwealth. We shall not be diverted from that policy and have no intention of relinquishing our responsibility for the defence of Malaya and the protection of its law-abiding peoples by all means at our disposal.
    Mr. Gammans: Is the Prime Minister aware that all he said last April was that there would be no premature withdrawal and that that wishy-washy statement has created uncertainty among our friends and given great assistance to our enemies? Cannot he say something a bit more red-blooded than that?
    The Prime Minister: It is a pity that the hon. Member did not study what I said last April. It was, I understood, accepted by the whole of the House with satisfaction, except by the former Member for West Fife, Mr. Gallacher. I said:
    "His Majesty's Government have no intention of relinquishing their responsibilities in Malaya until their task is completed. The purpose of our policy is simple. We are working, in co-operation with the citizens of the Federation of Malaya and Singapore, to guide them to responsible self-government within the Commonwealth. We have no intention of jeopardising the security, well-being and liberty of these people, for whom Britain has responsibilities, by a premature withdrawal."—[OFFICIAL REPORT, 13th April, 1949; Vol. 463, c. 2815.]
    I have heard of no one but the hon. Member who has raised any doubts in the matter.
    Sir Ralph Glyn: May I ask the Prime Minister whether he is satisfied that that statement was made sufficiently known by local broadcasting at the time?
    The Prime Minister: I should think so. I will make inquiries. I have no reason to think that it was not.
    Mr. Harrison: Will my right hon. Friend agree that the inference in the Question has one of the most important hampering effects on the anti-bandit campaign in Malaya at the present time?
    Mr. Gammans: Is the Prime Minister aware that, whatever interpretation he may put on the statement, every section

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    of the Malayan Press considers that that statement has not made our intentions sufficiently clear?
    The Prime Minister: No, Sir.
    Mr. Oliver Stanley: It is now, is it not, perfectly clear that under no circumstances have the Government any intention of withdrawing from Malaya, and that that can go out to the Malayan people as an absolutely confirmed statement?
    The Prime Minister: It is clear, and always has been so.

    NATIONAL THANKSGIVING FUND
    Mr. Jannerasked the Prime Minister whether the Government will be associated in any way with the National Thanksgiving Fund being set up to express Britain's gratitude to the Commonwealth and the United States for their gift parcels and bulk food supplies since 1940.
    The Prime Minister: The setting up of the National Thanksgiving Fund by voluntary organisers is intended as a measure of recognition of the generosity of our friends and relations in other parts of the Commonwealth and the United States, and His Majesty's Government warmly approve it and wish it the greatest possible success. This is to be a voluntary expression of thanks for the gift parcels which have been widely enjoyed, and I feel sure that we shall all help as we can with contributions great or small.
    No direct contribution of public money will be made, but, as the Chancellor of the Exchequer said in answer to my hon. and learned Friend the Member for Kettering (Mr. Mitchison) on 23rd March, special arrangements have been made for the Post Office to display posters and collect contributions.

    CENTRAL OFFICE OF INFORMATION (BOOKS)
    Mr. Emrys Hughesasked the Lord President of the Council what new books of a political, biographical and historical character, has the Central Office of Information recommended to the Foreign Office, the Commonwealth Relations
    182
    Office and the Colonial Office for distribution to their information officers overseas since 1st January.
    The Lord President of the Council (Mr. Herbert Morrison): This is a matter for the three Departments named, and if my hon. Friend wishes to pursue the matter he should put questions down to the three Secretaries of State concerned.

  NATIONAL FINANCE

    Lifeboatmen (Cash Awards)
    Mr. H. A. Priceasked the Chancellor of the Exchequer how far his regulations prescribe that cash awards to lifeboatmen for gallantry and fortitude at sea should be subject to tax; and if he will consider exempting these payments from tax entirely.
    The Chancellor of the Exchequer (Sir Stafford Cripps): The regular fees and other awards paid to voluntary lifeboat-men are liable to Income Tax, but tax would not be claimed on a special reward for a particular act of gallantry.
    Mr. Price: Is the right hon. and learned Gentleman aware that his officers in the areas concerned have recently attempted for the first time to assess such awards for tax? Is he further aware that such an assessment would be regarded as a most distasteful extortion, and will he make a statement that it is not to be proceeded with?
    Sir S. Cripps: I am not aware that any such cases have occurred. If the hon. Member will send me particulars of them. I will have them looked into.
    Commander Noble: Can the Chancellor say whether he has been having consultation on this subject with the Royal National Lifeboat Institution?
    Sir S. Cripps: An arrangement was made with them a long time ago, but there have been no recent consultations as far as I am aware.

    Personal Incomes, Costs and Prices
    Sir T. Mooreasked the Chancellor of the Exchequer whether it is the intention of His Majesty's Government to confirm or discard the policy of freezing wages and salaries.
    Sir S. Cripps: The policy of restraint on personal incomes, costs and prices as enunciated in the White Paper of February, 1948, and as emphatically restated by my right hon. Friend the Prime Minister in his statement on 24th October last remains a policy of the first importance for the future welfare of this country.
    Sir T. Moore: But surely this policy of freezing salaries and wages must lead inevitably to a common level of mediocrity and output since there is no inducement to do any better?
    Sir S. Cripps: No, Sir.
    Mr. Awbery: Are we to take it that the Opposition now agree that wages are not to be frozen and that they will not object to applications from working men for increases in wages?
    Sir H. Williams: May I ask the right hon. and learned Gentleman when he will start to give effect to the policy?
    Sir S. Cripps: That is not a policy to which I can give effect; it is a policy to which both sides of industry have already given effect.

    Purchase Tax
    Mr. De la Bèreasked the Chancellor of the Exchequer whether, in cases where Purchase Tax is reduced or remitted on any article and the retailer is compelled to lower the price of the article to the public, thus incurring a loss in the value of his stock, he will in future make provision whereby the retailer can recover the difference in the tax which he has already paid.
    Sir S. Cripps: I fear that up to the present it has not been possible to devise in consultation with the trade a fair and workable solution of this very difficult problem. I cannot therefore at present commit myself as to the future.
    Mr. De la Bère: But does the right hon. and learned Gentleman not hold out some hope? Does he recollect that last time the answer was that it was administratively impracticable? Surely he is getting one stage better. Let us get on with the job.
    Sir S. Cripps: We are certainly still using all the ingenuity of the trade as well as our own to try to devise a satisfactory system.
    Mr. Wade: Will the Chancellor consider granting a discount to retailers, having regard to the fact that they suffer loss not only where Purchase Tax is reduced but also where goods are damaged, broken or otherwise become unsaleable, because, tax having been paid it is irrecoverable?
    Sir S. Cripps: There is another Question on that point later on the Paper.
    Colonel Ropner: Will the right hon. and learned Gentleman admit that there is an unfair burden placed on retailers in an arbitrary and indiscriminate manner by the reduction of tax?
    Sir S. Cripps: There has been no reduction in tax so far which has hurt anybody.
    Mr. Stanley: Could the right hon. and learned Gentleman tell us whether there is likely to be one in the immediate future?
    Sir S. Cripps: That is a matter upon which everybody can take their own view.

    Economic Situation
    Mr. Osborneasked the Chancellor of the Exchequer in view of the views expressed in paragraph 30 of Command Paper No. 7572, what new steps he proposes to take to ensure that the difficulties of the present economic situation are presented to the British public in an obvious form.
    Sir S. Cripps: The Government will continue to take every opportunity by speeches in this House and elsewhere, by providing factual information to the Press and the B.B.C. and by official publications of various kinds, to ensure that the difficulties of our economic situation are presented to the public in an understandable form.
    Mr. Osborne: Is the Chancellor informing the House that the public still do not realise the gravity of our economic situation, or has the opinion of the Government altered since the White Paper was issued?
    Sir S. Cripps: A great deal of education was done during the General Election, which I am sure has helped.
    Mrs. Jean Mann: Does my right hon. and learned Friend think that "The Right

    185
    Road for Britain" was helpful education in acquainting the public of our economic difficulties?
    Sir S. Cripps: I think it showed them something which should be avoided.
    Mr. Godfrey Nicholson: If the right hon. and learned Gentleman persists in his economic policy, will not the facts speak loud enough for themselves?
    Sir S. Cripps: They are so doing, hence the success with which we are meeting the situation.

    Amateur Dramatic Societies
    Mr. Gerald Williamsasked the Chancellor of the Exchequer if he is aware that unless Section 10 of the Finance Act, 1949, is amended, many amateur operatic and dramatic societies will be unable to carry on; and if he will bear this in mind when he is framing his Budget.
    Sir S. Cripps: Representations have been made to me in the sense of the first part of the Question; and I will, of course, bear these representations in mind in framing my Budget.
    Mr. Williams: Whilst thanking the Chancellor for saying that he will bear this in mind, is he aware that if an amateur theatrical company employ a professional producer or conductor, or any other form of professional person, they cannot reclaim this tax however genuinely they are an amateur society?
    Sir S. Cripps: I am aware of the difficulties, which have been brought to my attention.

    Beer (Taxation)
    Mr. Colegateasked the Chancellor of the Exchequer if he will give figures showing the number of barrels of beer brewed in Great Britain and Northern Ireland in each year from 1920 to 1949; and the amount of revenue accruing to the Exchequer therefrom in each year.
    Sir S. Cripps: As the answer is in the form of a table of figures, I will, with the hon. Member's permission, circulate it in the OFFICIAL REPORT.
    Mr. Colegate: Whilst thanking the Chancellor, may I ask would he not agree that the over-taxation of beer has meant
    186
    a loss to the Revenue and deprived many ordinary people of their customary glass of beer owing to the incidence of tax reflected in the price?
    Sir S. Cripps: No, that is not the evidence of the figures.
    Mr. Boothby: Will the right hon. and learned Gentleman give consideration to the possibility of strengthening the beer?
    Sir S. Cripps: Certainly, I will give consideration to everything.
    Mr. Nally: When considerations pass through the mind of the Chancellor on this subject, will he bear in mind the steady and the great increase in the profits of brewers since 1920?
    Following is the table:

    Quantities charged with duty.

    Net receipts

    Financial Year

    Bulk barrels

    £

    1920–21

    34,504,570

    123,393,903

    1921–22

    30,178,731

    121,844,583

    1922–23

    23,948,651

    92,262,893

    1923–24

    25,425,017

    76,110,638

    1924–25

    26,826,665

    75,825,827

    1925–26

    26,839,317

    76,320,021

    1926–27

    25,167,933

    78,763,480

    1927–28

    25,435,145

    77,800,471

    1928–29

    24,608,342

    70,846,978

    1929–30

    25,061,956

    71,254,674

    1930–31

    23,900,213

    69,269,299

    1931–32

    20,790,812

    68,710,020

    1932–33

    17,950,303

    67,097,581

    1933–34

    20,182,308

    53,884,405

    1934–35

    20,864,814

    53,582,335

    1935–36

    21,969,763

    55,451,926

    1936–37

    22,724,450

    57,318,585

    1937–38

    24,205,631

    61,241,404

    1938–39

    24,674,992

    62,370,034

    1939–40

    25,366,782

    75,157,022

    1940–41

    26,203,803

    133,450,205

    1941–42

    29,860,796

    157,254,430

    1942–43

    29,296,672

    209,584,343

    1943–44

    30,478,289

    263,170,703

    1944–45

    31,332,852

    278,876,870

    1945–46

    32,650,200

    295,305,369

    1946–47

    29,261,398

    250,350,829

    1947–48

    30,408,634

    264,112,043

    1948–49

    26,990,144

    294,678,035

    The figures prior to 1922–23 relate to Great Britain and Ireland, separate figures in respect of Great Britain and Northern Ireland not being available.

    Death Duties
    Mr. Colegateasked the Chancellor of the Exchequer the amount of revenue derived from Death Duties for each year from 1920 to 1949 giving separately that part of the total receipts derived from

    187
    agricultural estates and that part derived from all other forms of property attracting Death Duties.
    Sir S. Cripps: The hon. Member will find particulars of the revenue derived from Death Duties in the Finance Accounts of the United Kingdom for each year. The amount of Death Duties paid on agricultural estates is not separately recorded but on the present basis the figure is estimated to be about £3.3 million a year.
    Mr. Colegate: Would the right hon. and learned Gentleman agree that that drain from agriculture is exercising a serious effect at the very time he wants to increase the capital engaged in the industry?
    Sir S. Cripps: I think the comparatively good treatment given to agricultural land under these provisions has been demonstrated and accepted.

    High Court Judges (Salaries)
    Mr. Marloweasked the Chancellor of the Exchequer when it is proposed to introduce the necessary legislation to effect increases in the salaries of His Majesty's High Court judges which the former Financial Secretary to the Treasury stated on 3rd May, 1949, would certainly be done during 1949.
    Sir S. Cripps: This matter will be considered further when the economic situation of the country permits.
    Mr. Marlowe: Does the right hon. and learned Gentleman realise that this was a solemn pledge given by the Financial Secretary on 3rd May last year, which was after the Budget Speech and, therefore, must be considered outside the standstill which the right hon. and learned Gentleman laid down? Is he prepared to say that His Majesty's Government are going back on that solemn undertaking given in those circumstances?
    Sir S. Cripps: There was no solemn undertaking given. What was said by my right hon. Friend—
    Mr. Marlowe: A broken pledge.
    Sir S. Ctipps: —was:
    "Legislation will be necessary, and I think can promise the House that that legislation will not be long delayed; it will certainly be this year."—[OFFICIAL REPORT, 3rd May, 1949; Vol. 464, c. 814.]
    That was not a pledge that there would be any increase in salaries.
    Mr. Marlowe rose—
    Mr. Stanley: Could the right hon. and learned Gentleman say what other purpose there could be for this legislation?
    Sir S. Cripps: Certainly. There could be legislation passed which would enable us at an appropriate time to increase salaries.
    Mr. Marlowe: Would the Chancellor not agree that the whole object of the Question and answer was directed towards the matter of the increase in salaries, and does he not agree, whatever other standstill may have to be made, that there is a sound case for increasing salaries which were fixed against the cost of living in 1831?
    Sir W. Smithers: Will the Chancellor tell the House and the country what is the good of a thousand paper pounds a week if they are worthless, as they are becoming more and more worthless today under this Government?

ECONOMIC SURVEY, 1950 (PUBLICATION)
Sir S. Cripps: With your permission, Mr. Speaker, I should like to inform the House that the Economic Survey for 1950 has just been presented and that copies are now available in the Vote Office. It will be on sale tomorrow, when a popular illustrated version entitled "Survey '50" will also be available.
ORDERS OF THE DAY

  CONSOLIDATED FUND BILL
  Order for Second Reading read.
  Motion made, and Question proposed, "That the Bill be now read a Second time."—[Mr. Jay.]

  FOREIGN AFFAIRS
  3.32 p.m.
  Mr. Churchill: I notice, Mr. Speaker, that you looked to the other side of the House, and I certainly fully comprehend the motives which led you to look in that direction. I am sorry that the Foreign Secretary was not willing to open this Debate—[HON. MEMBERS: "Where is he?"]—by making a general statement on foreign affairs to the new House of Commons. I should have thought that when a new Parliament assembled, the chief representatives of His Majesty's Government, either the Foreign Secretary or the Prime Minister, would welcome the opportunity of laying before us a full statement of their policy and theme. Nor can I recall any situation in which such guidance was more imperatively demanded, not only by the Opposition, but still more by the movement of events.
  However, our request has been rejected. The object, I suppose, was a manœuvre or tactics to draw whoever spoke for the Opposition into a statement of their views and then to pick out such odd points as emerged for debating purposes—and this on the subject of foreign affairs, which surely should be and can be lifted above the untimely and costly party struggles to which we are now condemned. In all the main issues of foreign policy the Opposition in the late Parliament supported, sustained and even pointed the course which the Foreign Secretary has pursued.
  Mr. Sydney Silverman: What were you worried about?
  Mr. Churchill: Then we were weak; now we are equals—almost. But our intention is to give the same help to His Majesty's Government in foreign affairs as we did in the years when we were helplessly outnumbered. In fact, it will be stronger help numerically. The Foreign Secretary need not, therefore—I
  190
  trust that he is not in any way indisposed—[HON. MEMBERS: "Where is he?"]—but it does seem to me that as he is going to reply to the Debate one would have had the opportunity of his attention at this moment.
  The right hon. Gentleman need not be afraid—perhaps someone will tell him when they see him—that any decision which he makes in the national interest will be obstructed or baffled by the votes of those over whom he has a majority numbered only by digits. On the contrary, he may feel assured that so long as he marches forward on the broad lines of policy on which we have been agreed, he has overwhelming Parliamentary support. The fact that the Government have a precarious existence need in no way hamper him. The fact that we lie between General Elections need not induce him, or whoever is to take his place, to take weak courses or play for small party gains. We do not intend that the national interest at a time so anxious and critical as this shall suffer from the equipoise of political parties. But let us make sure where our national interest lies and how our part in shaping world affairs can best be played.
  I do not intend this afternoon to occupy too much time in the Debate in which so many Members wish to take part. I shall, therefore, not refer to a great many topics and episodes which are in our minds or attempt to deal myself with the Far Eastern problems, which, although they may be touched upon in this Debate, are so urgent and serious as to require a separate Debate as soon as opportunity can be found.
  I shall now only attempt to deal with the crucial and cardinal aspects of the Western scene. I select the key problems, namely, the relations between Britain and France, acting together, and Germany, and of the bearing of all this upon Western Europe, its life, its hopes, and its self-defence. The whole of this discussion, of course, and the whole of my argument are sustained by the decisive strength of the United States as expressed by the Atlantic Pact. Thereafter it is my duty to refer to the relations of the Western democratic world with Soviet Russia. I am most anxious that the tremendous issues with which we are now confronted should be presented in a simple form.

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  The Prime Minister accused me last week of "irresponsibility" in raising the question of Germany—by which I mean liberated Germany—taking any part in Western defence. My feeling is, and I hope, the Prime Minister will allow me to say so, that I am as good a judge of these matters as he is. Certainly I should not like to be responsible for not stating my true and faithful belief and counsel to the House, as I have done several times in the past when it was not particularly popular to do so. I remember that during the last Parliament, not to go too far back, I made a speech at Fulton which became the object of a Motion of Censure signed, I think, by more than 100 Members of the Socialist Party. But shortly afterwards, the policy I had advocated was adopted on both sides of the Atlantic and by all parties in this House. So I shall not feel myself utterly extinguished by the Prime Minister's censure.
  The Prime Minister also complained that such a question as that of Germany aiding in Western defence should have been "injected"—that is the word he used, "injected"—into a Debate on defence, but that was surely its natural and obvious place in the first instance. Other hon. Members, notably the hon. Member for Coventry East (Mr. Crossman), whom I see in his place, misquoted what I said and then criticised the distorted version. I picked my words very carefully and I do not wish to modify them in any way today. I said nothing about the re-armament of Germany or about recreating the German Army, but I see no reason why the Germans should not aid in the defence of their own country and of Western Europe, or why British, American, French and German soldiers should not stand in the line together on honourable terms of comradeship as part of a combined system of defence.
  I try to pursue, as it seems to me, a steady theme and my thought as far as I can grasp it, measure it, is all of one piece. It is the building up of effective forces of resistance to tyranny and aggression in any form, or from any quarter. The House of Commons is the foe of tyrants, whatever uniform they wear, whatever formulas they use. We must discern their character in good time and labour to resist their force with all
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  our strength. But I am not concerned today only, or even mainly, with the military aspect.
  We are nearly all of us now agreed in seeking the unity and restoration of Europe as a great hope for the future. We cannot do this without the aid of the Germans. The strong German race, which, during the last 40 years, we and our Allies twice fought and defeated, have now the opportunity of rendering an immense service to mankind. Having submitted to internal tyranny and brought measureless suffering upon us all, and especially themselves, they now have a chance of redeeming the German name by helping to repair what has happened in the past and by playing their part—and it might be a great one—in lifting the civilisation of Europe to a level where its old glories may revive and where the various forms of tolerant freedom and resulting happiness and culture may be restored.
  There can be no hope for a United Europe without Germany, and there is no hope for Germany except within a free and United Europe. How can these vital conditions be achieved? Here is a problem in which you may wander around all sorts of tangled labyrinths of thought, but you will come back to the overpowering fact that Europe cannot be restored without the active aid of Germany and that without a restored Europe world peace cannot be established on sure foundations.
  When I spoke at Zürich nearly four years ago, I said it would be the proud duty of France to stretch forth her hand and lead Germany back into the European family. I said at the time that this statement would create astonishment, and it certainly did. But since then we have made great progress. The whole structure of Western Union has developed. We thank the Foreign Secretary for the part he has played in it. We are presently to have a meeting at Strasbourg of the Council of Europe and the Assembly where, we trust, in spite of all that has happened, French and German hands will be clasped in concord. I recommend to the House that we should do all in our power to encourage and promote Franco-German reconciliation as an approach to unity, or even perhaps some form, in some aspects, of union. Let anyone who can

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  take a point on this, beware how he mocks at such themes.
  But France, after her tribulations and in her present disturbed condition, may not be strong enough to accomplish single-handed her mission. That is why the intimate and inseparable relationship between Britain and France and between the British Empire and Commonwealth of Nations and France must be affirmed and asserted continually in the most effective manner. France and Britain, both sorely distressed, can combine together and, thus joined, have the superior power to raise Germany, even more shattered, to an equal rank and to lasting association with them.
  Then these three countries, helping each other, conscious of their future united greatness, forgetting ancient feuds and the horrible deeds and tragedies of the past, can make the core or the nucleus upon which all the other civilised democracies of Europe, bond or free, can one day rally and combine. Woe be it to anyone in the free world, who, by lack of understanding, or by lack of goodwill, or by lack of world hope, or any more flagrant fault or blunder, obstructs or delays this essential combination.
  There was a time when men thought that the conception of a United States of Europe would be resented by the United States of America, but now we have the American people, with their own heavy burdens to bear, sacrificing themselves and using all their power and authority to bring about this very system. In this lies the hope of the Western world and its power to promote beneficial solutions, perhaps, of what happens in Asia.
  I do not wish to fall into vague generalities. Let me, therefore, express our policy as I see it in a single sentence. Britain and France united should stretch forth hands of friendship to Germany, and thus, if successful, enable Europe to live again. I am distressed when I read in the newspapers, for I have no other information on these matters except my own knowledge, about petty obstructive vexations which hamper this grand design. We read of the belated blowing up of the tail end of the German munition factories; and of the trial of aged and decrepit German field-marshals. We read on the other hand of an impudent Goebbels film improperly released in the
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  American zone at which Germans cheer anti-British propaganda. How easy it is to mar large unities, how hard to make them.
  We in this House and in these islands must rise above these pettinesses. It may well be that our safety depends on our proving ourselves capable of doing so. Follies on one side lead to misbehaviour on the other. Europe, at this moment of resurgence, cannot afford to make silly mistakes, or, if they are made, allow them to darken her thought or divert her aim. We here have all been busy in a General Election, and over us hangs another with all its preoccupations for our divided and harassed land. But meanwhile many things are happening abroad which should not pass unnoticed or unmeasured.
  Almost at the same time that I spoke in the defence Debate, a statement was being made by General de Gaulle on Franco-German relations. As the House knows, I have not always seen eye to eye with that patriotic Frenchman, who represented in the war more than any other man, the will to live of France. Certainly there is no one in France who could have opposed with more vigour and injurious effect the reconciliation between the French and German people. He represents the most powerful forces which could have been arrayed on the wrong side. But what did he say? He spoke of the proposal which Dr. Adenauer had just made for an economic union between France and Germany. I shall read his words. He said:
  "I have followed for 30 years the ideas of the German Chancellor. In what this good German has said I have found the echo of the call of Europe."
  Relations between the two countries must be viewed against a European background. In short the grand design of Charlemagne must be re-adapted to modern conditions.
  "Why should not the Rhine become a street where Europeans meet, rather than a ditch dividing hostile camps?"
  I must say that when I read this statement in the newspapers I hoped that it might be received throughout Europe, as it has been here in the House, to quote the lines of Rupert Brooke,
  "with the silence following great words of peace."
  It certainly was treated with the utmost

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  respect throughout the Continent. Some will call Dr. Adenauer's proposal for an economic union between Germany and France premature, unsure, only partly thought out. Surely, however, it lies near the root of the matter. What we want is far more than that, but these two speeches by General de Gaulle and Dr. Adenauer together constitute a memorable event.
  Here is the forward path along which we must march if the thousand-year feud between Gaul and Teuton is to pass from its fierce destructive life into the fading romance of history. Here are two men who have fought and struggled on opposite sides through the utmost stresses of our times and both see clearly the guidance they should give. Do not let all this be cast away for small thoughts and wasteful recriminations and memories which, if they are not to be buried, may ruin the lives of our children and our children's children. It may be that this year, 1950, on which we have entered in so much perplexity and dispute, can be made the occasion for launching Europe on its voyage to peace with honour. Let us make sure that we play our part in turning thought into action and action into fame.
  I am very glad to see the right hon. Gentleman the Secretary of State for Foreign Affairs. I can assure him that he has a great fund of good will among all parties. We know what a burden he has had to bear. Some of us had to bear that burden for five years; he has borne it at the same tenseness for ten. We speak of him always with great feelings of personal regard although it is our duty to criticise errors in the conduct of foreign policy rather than in its inspiration, which come to our notice.
  I hope to hear from the Foreign Secretary tonight that no British party will fall behind in its duty in the European cause. People say that all these are visionary and sentimental ideas which ignore the practical realities. They say they blot out the lessons of the past and the difficulties of the present and thus will have no real application for the future. But it is a great mistake to suppose that nations are not led by sentiment. It takes too poor a view of man's mission here on earth to suppose that he is not capable of rising, to his material detriment, far above his
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  day to day surroundings. The dominant forces in human history have come from the perception of great truths and the faithful pursuance of great causes.
  I have always held that the cause of united Europe would not be helped, and might well be injured, by attempts to draw up precise and rigid constitutions and agreements too soon or in a hurry. The first stage is to create a friendly atmosphere and feeling of mutual confidence and respect. Even a day's delay in working hard for this is a matter for regret. Once the foundation of common interest and solidarity of sentiment has been laid, it may well be that formal agreements would take the form, not of hard bargains or weak compromises, but of setting down on paper the living basic truths and thoughts which were in all minds. Then difficulties, at present insuperable, might well become irrelevant.
  In this field it is a practical and immediate step that can be taken, namely, the arrival at Strasbourg this summer of a German delegation to the European Assembly of the Council of Europe. More than two years have passed since the Germans came to the Hague on the invitation of our unofficial European movement. I had an agreeable and, to me, a memorable interview with them. It was there I met Dr. Adenauer, little knowing how soon he would be the German Chancellor at the head of a German Government. Since then great forward steps have been taken. The Council of Europe and the European Assembly are institutions formally and permanently established; young, but august; sustained by many freely elected Parliaments. The presence of Germany in our midst will be an event from which nothing but good can come.
  It would be a great pity if doubts and further delays were caused by boggling and haggling, or the drawing up of conditions. I was sorry to see that the Germans had written out a number of conditions on which they would be prepared to join the Council of Europe. That is falling below the level of events.
  Many voices are raised of provocation and false counsel on every side. I sincerely hope that Dr. Adenauer will show that the new Germany can rise superior to such distractions, no matter how or whence they come. I am glad to see that there is better news about this today, but I would say to the Germans, "Let it

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  all happen naturally and easily, and you will find that very soon Germany will take her proper pace, and that all questions of legalistic status will cease to be of any importance."
  I have one more observation to make about the European Assembly. Substantial results flowed from that Assembly at Strasbourg last year. But the contrast between the activities of the Assembly and the apparent inaction of the Committee of Ministers, has created the impression that the Ministers are not wholehearted in their intention to promote the Union of Europe. Whether this impression is correct or incorrect it is gaining ground, and I say to the right hon. Gentleman, who is off on a journey there tonight, that only some positive unequivocal pronouncement by the Committee of Ministers when it meets next week can undo it. The situation is especially serious because our own position is called in question. It is widely thought on the Continent and in America that the British Government are lacking in zeal for the whole plan—" dragging their feet "is, I believe, the American expression. It is said that on the Committee of Ministers the Foreign Secretary is always amongst those who wish to advance less far and less fast. This is what is widely believed and it tends to weaken our general influence in Europe. I hope that the right hon. Gentleman will clear away these misgivings when he speaks this afternoon.
  It would certainly be ungracious on my part if I left the subject without acknowledging the services rendered by the recent Colombo Conference in proclaiming that there is no incompatibility or inconsistency between Britain's part in a United Europe and her position as the centre and pivot of the British Empire.
  Now I come to the last aspect of what I wish to say. I come to our relations with Soviet Russia. I will begin by stating the reason why I do not believe that another war is imminent or inevitable, and why I believe that we have more time, if we use it wisely, and more hope of warding off that frightful catastrophe from our struggling, ill-informed and almost helpless human race. Here is the reason. There never was a time when the deterrents against war were so strong. If penalties of the most drastic kind can prevent in our civil life crime or folly,
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  then we certainly have them here on a gigantic scale in the affairs of nations. It is extraordinary. The penalties have grown to an extent undreamed of; and at the same time, many of the old incentives which were the cause of the beginning of so many wars, or features in their beginning, have lost their significance. The desire for glory, booty, territory, dynastic or national aggrandisement; hopes of a speedy and splendid victory with all its excitement—and they are all temptations from which even those who only fight for righteous causes are not always exempt—are now superseded by a preliminary stage of measureless agony from which neither side could at present protect itself.
  Another world war would begin by both sides suffering as the first step what they dread most. Western Europe would be overrun and Communised, with all that liquidation of the outstanding non-Communist personnel of all classes, of which, I understand, in respect of several countries, elaborate lists have already been prepared—which are, no doubt, kept up to date in those countries by the Communist groups and parties in their midst. That is one side. On the other hand, at the same time, Soviet cities, air fields, oil fields and railway junctions would be annihilated; with possible complete disruption of Kremlin control over the enormous populations who are ruled from Moscow. These fearful cataclysms would be simultaneous, and neither side could at present, or for several years to come, prevent them. Moralists may find it a melancholy thought that peace can find no nobler foundations than mutual terror. But for my part, I shall be content if these foundations are solid, because they will give us the extra time and the new breathing space for the supreme effort which has to be made for a world settlement.
  No one need delude himself by underrating the difficulties which stand in the way of a settlement or by closing his eyes to the gulf which yawns between the two worlds, now facing each other, armed and arming, reaching out for agencies which might eventually destroy the human race. As I said at Boston last year, I think it probable that the Soviet Government fear the friendship of the West even more than they do our

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  hostility. The Soviet regime and the lives of its rulers might be imperilled by allowing free, easy and friendly inter-mingling with the outer world. An endless series of quarrels, a vehement and violent antagonism, the consciousness of an outside enemy in the minds of the masses, may be regarded by the Soviet as a necessary precautionary element in maintaining the existence of the Communist power. There indeed is a gloomy thought. There indeed is a reason for fear. But fear must never be allowed to cast out hope.
  During the election I was most anxious that the return of a Conservative Government to power, which was a possibility, should not be taken as involving an exacerbation of the already tense situation that exists, and that we should make it clear, above all things, that we should strive faithfully for peace. I also felt, and feel, that we owe it to our consciences, all of us, that no door should be closed which may lead to better prospects. I do not, of course, take an over-sanguine view of the position whatever efforts are made, but it is our Christian duty to try our best. Moreover, the democracies of the West must be constantly convinced that those who lead them do not despair of peace if they are to take even the measures which self-preservation demands in case the worst should come to the worst.
  Let me repeat what I said at Edinburgh—only a few lines:
  "I cannot help coming back to this idea of another talk with Soviet Russia upon the highest level. The idea appeals to me of a supreme effort to bridge the gulf between the two worlds so that each can live their life, if not in friendship at least without the hatreds of the cold war."
  I was answered by the Foreign Secretary that all this was a "stunt." Whatever this American college slang, as I find it is described in the dictionary, may have implied, it did not seem to me completely to dispose of the subject which had been raised. He also said that through the United Nations must be found our only process and resource. But three days later, on 17th February at a Press conference at Lake Success, Mr. Trygve Lie, the Secretary General of U.N.O., said he was in favour of great Power negotiations:
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  "all the time and on all levels—top level, middle level, and lower level—inside and outside the United Nations. The world would be a lot better today if there had been more real negotiations among the great Powers during the past three years."
  He added, what we shall all agree:
  "The only people who can rightly judge the timing and form of negotiations and meetings are those who are responsible for conducting the foreign affairs of the countries concerned."
  We are all agreed, but those who are responsible, as the right hon. Gentleman and his principal colleagues are, must not fail to seize any opportunities. We cannot go on with a policy of hesitation and drift. Every day is precious if the chance occurs.
  I have explained this afternoon the arguments on which I base my belief that a further spell of time will be granted to us. Even at the risk of afterwards being reproached for being wrong, I have not hesitated to state my view that it may well be that several years may pass before a war breaks out. I will take the chance of making that remark although I have no special information at my disposal. Certainly we must seek to negotiate from strength and not from weakness. We all agree on that. Certainly we must move hand in hand with our Allies, and above all with the United States, as the right hon. Gentleman has so far done.
  We should do well to study the recent and most important announcements on foreign policy by the American Secretary of State, Mr. Acheson, whose gifts and services are so widely recognised. And here let me say how warmly we welcome in this House the news that that great American statesman, Senator Vandenberg, has recovered from his grievous operation and is able to exert again his clarifying and elevating influence on world events. The American people are fortunate in finding so many outstanding figures at a time when they hold the leading place among the nations.
  But if there is a breathing space, if there is more time, as I feel and do not hesitate to say, it would be a grave mistake of a different order, perhaps a fatal mistake, to suppose that, even if we have this interlude, it will last for ever, or even last more than a few years. Time and patience, those powerful though not infallible solvents of human difficulties, are not necessarily on our side. When the last Parliament met, I mentioned four years

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  as the period before any other Power but the United States would possess the atomic bomb. That period has already gone by, and our position is definitely worse than it was in this matter both as regards our own safety and as to the conditions which are, I believe, effectively preserving the peace of the world.
  There is no doubt now that the passage of time will place these fearful agencies of destruction effectively in Soviet hands, that is to say, where there is no customary, traditional, moral or religious restraint. Of course, there is an interlude between the discovery of the secret and the effective large-scale production of the article, and that also has to be borne in mind. Of course, the United States have their "stock-pile," as it is called, and it will be only by a gradual process that anything similar can be built up in Soviet Russia. The atomic bomb, though preponderating, is only one of the factors in the military situation before us, but it is the dominant factor. If, for instance, the United States had a "stock-pile" of 1,000 atomic bombs—I take the figure as an illustration merely; I have no knowledge of any sort or kind of what they have—and Russia had 50, and we got those 50, fearful experiences, far beyond anything we have ever endured, would be our lot.
  Therefore, while I believe there is time for a further effort for a lasting and peaceful settlement, I cannot feel that it is necessarily a long time or that its passage will progressively improve our own security. Above all things, we must not fritter it away. For every reason, therefore, I earnestly hope that we shall hear from the Foreign Secretary a clear exposition of the facts and policy of His Majesty's Government upon matters graver than anything which human history records.
  Man in this moment of his history has emerged in greater supremacy over the forces of nature than has ever been dreamed of before. He has it in his power to solve quite easily the problems of material existence. He has conquered the wild beasts, and he has even conquered the insects and the microbes. There lies before him, if he wishes, a golden age of peace and progress. All is in his hand. He has only to conquer his last and worst enemy—himself. With vision, faith and courage, it may still be
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  within our power to win a crowning victory for all.
  4.21 p.m.
  Mr. Emrys Roberts: It is not an easy matter to follow the speech to which we have just listened, but I am sure that hon. Members in all parts of the House will agree with me when I say that, of all the speeches which the right hon. Gentleman the Leader of the Opposition has delivered, that which he has give us today was one of his greatest. I think I ought to say that, because I cannot remember any occasion when the right hon. Gentleman was more successful in carrying the House with him and in expressing our thoughts and desires. As he was speaking, my mind went back to the first Foreign Affairs Debate of the last Parliament in 1945. How different the situation was in those days; how we all thought that we might somehow build a peaceful world with all the Great Powers participating in that world. I still remember that one of the most significant features of that Debate was the acceptance by the right hon. Gentleman the Member for Warwick and Leamington (Mr. Eden) and by the Foreign Secretary himself, of the idea that peace could not come in the long run unless each nation accepted the surrender of some part of its sovereignty.
  Now, the deadlock between the Western world and the Soviet States baffles the statesmen and bewilders the common people all over the world. In spite of the armaments and in spite of the hostility which statesmen so often express, between the common people in every country there is only a deep yearning for peace. As I believe, whether they live in America, Britain, Europe or in the wide spaces of the Soviet Union, the common people everywhere want nothing so much as to live at peace with each other. Yet the sombre fact is, as was apparent from the speech of the right hon. Gentleman and is indeed known to us all, that the great nations of the world are devoting more of their energies and more of their resources to preparations for war than at any previous time in their history. They may call it defence, if they like, but, all the same, it amounts to preparation for war.
  The Brussels Pact and the Atlantic Pact, though they may be necessary in the present state of the world, are the

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  measure of the failure of the statesmanship of the different countries of the world to build a world-wide peace. While we may take the view that war in the next few years is not imminent, it is an historical fact that never have there been great armament preparations in modern history, without their leading to war. Sometimes we hear in this House the view that we should make ourselves so strong that no nation will dare to attack us. The history of our times proves the fallacy of that view. The dilemma of Great Britain was stated by Professor Gilbert Murray when writing in "The Times" recently, and quoting a Russia diplomat as saying to him:
  "If you do not re-arm, we shall overrun you with no trouble. If you do re-arm, you will fall into our hands through economic misery."
  This is the great dilemma in which this country finds itself. In order to break the deadlock of the world and to break out of her own dilemma, we must answer the question of what contribution Britain can make to world peace. What can Britain do? The final decisions are outside per power, but, nevertheless, Britain can make decisions which would safeguard the peace of the world.
  I think the first cardinal point of British foreign policy must be to support to the full the United Nations organisation and not to lose faith in it. There are people in certain sections of the community, and even certain hon. Members of this House, who have said from time to time that the United Nations is no good and that the delegations are simply wrangling in the Security Council. I think there is still hope of peace while statesmen are gathered round the council table, even though they are spending their time quarrelling among themselves. It is when they stop quarrelling and stop the argument that war breaks out. The first positive step is to get the Security Council working again. At the moment, the Security Council is paralysed by the deadlock over China.
  The British Government have recognised the new revolutionary Government in China, and I think they have acted rightly in doing so, because, after all, recognition of a Government is not and should not be a weapon of policy, but an action based on legal principles and a declaration of existing facts. China has
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  a seat on the Security Council, but it is by a representative of the former Nationalist Government of China that that country is represented, and though that Government is no longer in effective control of the national territory it has the power of the Veto in the Security Council. Though we may regret the fact of the new Government of China, I feel that it is better to press for its admission to the Security Council because the present situation only increases the deadlock on that body.
  I come next to the question of the atomic bomb. I feel that the nations can unfortunately only pursue a limited objective. It does not seem at the present time that the surrender of atomic bombs is likely or that destruction of the stockpiles is likely, either. Nor does it seem likely that certain countries will consent to international inspection of their atomic manufacture. As the right hon. Gentleman the Leader of the Opposition has said, the possession of the atomic bomb by the United States is no longer a safeguard for the peace of the world, and it would be very unwise if we assumed that Russia is not manufacturing the atomic bomb. Like other hon. Members of this House, I have no special knowledge of that matter, but I think I can safely say, without any special knowledge, that we should be very unwise to make that assumption.
  What can we do with regard to this atomic weapon? My hon. Friends and I placed a Motion on the Order Paper suggesting an international convention to ban the use of the atomic bomb and similar weapons. I know that the value of international conventions prohibiting the use of certain weapons has been doubted, and that there is a strong argument that it is only the fear of retaliation which prevents the use of such horror weapons as poison gas and the atomic bomb. Nevertheless, it is my opinion that, in the past, the mere existence of an international convention between the nations of the world has been a powerful factor in deterring the first use of such a weapon by an aggressor in the initial stage of his attack.
  There is no doubt that the Geneva Protocol of 1935, which prohibited the use of gas, and which was ratified by over 30 States, including all the great European Powers, was a powerful de-

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  terrent against the use of gas in the first onrush of the last war. At the very least, such an agreement would, I think, be a positive step forward, and, if it could be reached, might be a basis for further advance. It might contribute—although perhaps only to a small extent—to some feeling of confidence among the great nations. At any rate, it seems to be the only positive step forward which can be achieved at the present time.
  The Leader of the Opposition rightly said that never was there a time when the deterrents against war were so strong as at the present time. I think that is true, but I also think that that statement must be qualified by the recognition of the fact that at no time in modern history has the deterrent effect of the weapons of the day prevented an aggressor nation from rushing into war, because the nation which declares war first always thinks that it can overwhelm the other side before being overwhelmed in turn.
  I will conclude my remarks by a reference to European unity. The energy that has gone into the movement for European unity and the positive results now being achieved are one of the most hopeful signs of the post-war era. The Leader of the Opposition referred to certain impressions regarding the Committee of Ministers. I think it is also true to say that there is an impression abroad that Great Britain has retarded rather than advanced the cause of European unity. I do not believe that that impression is completely correct. We have been concerned with practical aspects of European unity, and we have taken the leading part in many places for that unity—the Marshall Plan, the Brussels Treaty and the Italian Treaty. But the truth has recently been expressed by M. Spaak, the President of the Assembly, who said in an article in the "Daily Telegraph" that, somehow, Great Britain always seems to be on the side of those who raise objections, who advise prudence, and who damp down enthusiasm. I think it is very difficult to counter that criticism.
  To what is that attitude due? It may be due in a very large measure to our relations with the Commonwealth, and it is high time that we honestly faced this question of the relation between a united Europe and the Commonwealth because
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  there is no doubt that it does raise difficulties. It is no use trying to hide that fact. All parties say that there is no conflict between the two allegiances of Britain and the right hon. Gentleman said it again today. That is true in an ultimate sense, but there are immediate difficulties, and merely to repeat that there are no difficulties only makes progress more difficult.
  I will give an illustration. The Assembly which met at Strasbourg was agreed that the economic integration of Europe, though necessary, could not go far without the setting up of a political authority with limited functions but real powers. A Committee of the Assembly was set up to report on the changes necessary in Europe's political structure in order to promote closer unity. But that view about European unity and those changes in the political structure of Europe must imply an acceptance by this country of a tie closer to Europe than the loose tie—loose in a constitutional sense, so far as material bonds are concerned—which binds her to the Commonwealth.
  There is no doubt that this problem of Great Britain's dual allegiance requires working out, and only this country can work it out. The Continental countries are passionately concerned that we should come into a closer unity in Europe, but their very concern makes them reluctant to put forward positive suggestions in regard to Britain. We should show our enthusiasm for a united Europe by putting forward concrete suggestions how we can reconcile our place in the Commonwealth with our place in Europe.
  There is one other aspect of the European movement to which I wish to refer. The field of foreign affairs is so vast that one speaker can only pick out certain outstanding features. I wish to refer to the Universal Declaration of Human Rights by the United Nations Assembly. It was undoubtedly a landmark in the annals of human freedom, but there was a paradox in that declaration. On the one hand, there was practical unanimity among the members of the United Nations in stressing the importance of the declaration. On the other hand, most of the delegates repudiated the idea that the declaration imposed a binding legal obligation on the member States to respect the human rights and fundamental freedoms which it proclaimed.

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  One of the big achievements of the European Assembly at Strasbourg was to draft a convention on Human Rights into which States could enter and thereby guarantee to their citizens certain legal rights. I hope that His Majesty's Government will push ahead with the adoption of this draft convention by all European States, and certainly by all the States of Western Europe. It is natural and proper that Europe should take the lead in thus implementing the Declaration of Human Rights. With all our faults, the rule of law is the most precious part of our European heritage, and in a world where the great struggle emerges more and more clearly as one between tyranny and freedom, the adoption in Europe of a Convention of Human Rights binding on all Governments would uplift the hearts of men and women everywhere.
  4.40 p.m.
  The Minister of State (Mr. Younger): The right hon. Gentleman the Member for Woodford (Mr. Churchill), who opened this Debate, began by complaining about the fact that my right hon. Friend the Foreign Secretary was not opening the Debate in the first place. I do not think that is a dispute in which I need follow him. I would only say that the speech he subsequently made did not indicate that he felt any embarrassment from the position he was occupying.
  I should like to follow the right hon. Gentleman in another respect—in attempting to limit myself to a small number of the numerous important problems which might well deserve the attention of the House. It is always one of the difficulties of any Debate on Foreign Affairs that one gets led into discussing problems in many parts of the world, and there is a temptation to simplify one's task by trying to deal with them in isolation, as if they were all quite separate matters. But today, as I think everyone in the House will recognise, international problems are so interlocked that they cannot be treated in that way. Nor can any international problem in any part of the world be solved without reconciliation of the views of a very considerable number of different Governments and States. It is for this reason that, in reviewing the international scene today, I shall find myself very largely involved in describing the development of a whole series of
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  international organisations and conferences.
  I think the first of these should be the Commonwealth Conference at Colombo. Although the right hon. Gentleman the Member for Woodford said that he himself would not deal with the problem of the Far East, I think the House would wish to know how matters stand as a result of that Conference.
  Then there is a whole series of organisations in the West. There is the Organisation for European Economic Co-operation—which, I hope, the House will allow me from now onwards to call O.E.E.C.—the Atlantic and Brussels Treaty organisations and the Council of Europe. The first thing I would ask the House to note about these bodies is that their work is wholly consistent with the United Nations Charter, although they themselves are not bodies which form part of the United Nations system. They have all been created, from 1947 onwards, to meet a situation in which the non-co-operation of the Soviet Union, both in the United Nations and in the Council of Foreign Ministers, had slowed down the progress of world recovery, and particularly of European recovery, to a complete standstill. Deadlock is most complete in relation to Germany and Austria. I want to say something about Germany a little later in my remarks.
  As regards Austria, I only want to emphasise how much we regret that it has not yet been possible to conclude a treaty in respect of Austria, and to say that we will continue to work for Austrian independence in accordance with the Moscow Declaration. In the meantime, I am sure the House would wish to join with me in paying tribute to the patience and steadfastness of the Austrian people in their difficult circumstances, and to express our confidence in the future of a free Austria.
  Since 1947, the non-co-operation of the Soviet Union has become more pronounced. It is now virtually world-wide. The countries bordering on the Soviet Union are more and more being withdrawn from general circulation as their domestic purges proceed. In countries outside immediate Soviet influence disruptive tactics are being followed, clearly designed to prevent any part of the world from settling down. All the while the Soviet Union is itself preserving sufficient

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  military potential to cause very natural concern about its intentions to its immediate neighbours and, indeed, to all of us. This tension between East and West is a fundamental fact of the present international situation. It forms an inescapable background to our thinking whether we are dealing with problems of the Far East, the Middle East or of Europe.
  As our recent Debate on Defence showed, one consequence has been to impose an additional strain on our resources, which are already sufficiently stretched by the need to carry out domestic reconstruction and, in conjunction with other industrially developed countries, to assist in raising the living standards in more backward areas—a policy which has long been recognised as a condition of stable world peace.
  It is no part of my purpose today to magnify, beyond its due significance, the Soviet withdrawal from co-operation and their scarcely veiled hostility to everything we are trying to do. I merely want to state this as a fact of the contemporary scene which, I am afraid, is not to be talked out of existence even by talks at the highest level.
  The right hon. Gentleman the Member for Woodford referred to his previous remarks about high level talks. But he also said that the timing of such talks must be left to those who have the responsibility. It will not have escaped his notice that of those who have that responsibility it is not only those who represent the United Kingdom who have felt that the moment is not now. He will also be aware that talks of that kind are only likely to be successful if there have been adequate preparations. We believe that we can only hope to modify the attitude of the Soviet Union on many of these great problems by the proved success of the efforts we are now making to build up strong communities of free people. Once such communities have faith in their own future then the mirage of a short cut to prosperity on the Communist model ceases to have its appealing power.
  It would, however, be quite a mistake to imagine that international co-operation and development is required only as a bulwark against Communism. That would be just as false as to suggest that European recovery is only required to meet the dollar crisis. It is, of course,
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  true that Communist threats and dollar difficulties have served to convince many, who, otherwise, might have remained blind, that national isolationism is now out of date. In that sense they have provided a spur to action, but the basic work of reconstruction and development, whether in South-East Asia, the Middle East, Europe or Africa which is now going on, would be, in any case, an indispensable minimum for our foreign policy even if there were no Iron Curtain and even if the dollar problem were already behind us.
  The newest and most striking development in international co-operation since our last Debate is the meeting of the Commonwealth Foreign Ministers at Colombo. The proposal for this Conference took shape in October, 1948, at a meeting of Commonwealth Prime Ministers in London, and, but for a further special meeting held in the spring of last year, this Conference might well have been brought forward to an earlier date.
  It is a happy augury that the first Commonwealth meeting on foreign affairs should have taken place in Asia, under the chairmanship of the Prime Minister of Ceylon. I should like to quote these words from his opening statement:
  "The particular advantage of holding a conference of this nature in one of the Asian countries of the Commonwealth is that it enables world problems to be examined from the Asian angle. The accession of India, Pakistan and Ceylon has strengthened the influence of the Commonwealth as an instrument for preserving world peace, because the Asian members of the Commonwealth can help their Western partners to see the world as a whole by bringing out in truer perspective those aspects of it which affect Asia most closely."
  Those words emphasise the fact that the British Commonwealth cuts across continents in a way which makes it a particularly valuable factor in building up world solidarity. The objective of the Conference was to exchange views on world problems, with particular reference to South-East Asia and the possibility of promoting economic development, raising living standards and ensuring political stability.
  Agreement was reached on a number of points, and on those action is already under way. The first point was the basic requirements of a peace treaty with Japan. There was no disagreement that an early

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  peace treaty was desirable, or that it should not be a punitive settlement, though there must be guarantees against the revival of Japanese militarism. But the most difficult problem was, on the one hand, to ensure that Japan can stand on her own feet and offer a reasonable livelihood to her people, and, on the other hand, to allay the anxieties of other nations about the impact of unfair Japanese competition based upon low living standards. That is obviously a matter which requires very close study. A working party to carry out that study is being set up in London. The proposed first meeting of that working party will take place, I think—we hope, at any rate—in the latter part of April.
  The second point on which agreement was reached was the joint Commonwealth loan to Burma, of which mention has already been made in Debates in this House. That was accepted by the Burma Government only a few days ago. The total of the loan is £6 million and the United Kingdom share of that is £3¾ million. The third point on which there was unanimous agreement was on the need for a concerted plan of economic and social development in South-East Asia. The conference accepted concrete proposals to this end which were sponsored by Mr. Spender on behalf of the Government of Australia.
  As a result of those proposals, a Commonwealth consultative committee will meet on 15th May in Sydney. I hope the House will not under-estimate the scale and the complexity of any proposals designed to raise the living standards in so vast and heterogeneous an area as this. We are confident that there will be progress, but I think that it is as well to echo Mr. Spender's own warning that
  "it is not to be expected that it will achieve spectacular results in a short time."
  The raising of living standards must inevitably be a long-term project, and, in the short-term, all we can hope for is some alleviation of the worst distress and, in particular, the giving of some hope of future development.
  The United Kingdom, of course, will play a full part at the Sydney Conference. There will be a need there both for ministerial guidance and for official work of the very highest quality. It is
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  proposed that the United Kingdom delegation should be led by the Paymaster-General, Lord Macdonald, who will be better known to a number of Members in this House as a former Member for Ince, and he will be supported by the Commissioner General for South-East Asia and by a strong group of officials. Preliminary work for the conference is already under way. It is too soon, of course, to forecast the type of organisation for development for South-East Asia which is likely to emerge from these consultations, but it is hoped that it may be possible for non-Commonwealth countries interested in the area to participate, and we are glad to note already expressions of interest on the part of the United States of America.
  In Europe and in the Atlantic area co-operation is, of course, considerably more advanced than in South-East Asia. As the House knows, there are four main organisations which are involved and have become involved since the original speech of General Marshall, in 1947. There was the Brussels Treaty which was signed only just over two years ago. That was quickly followed by the setting up of O.E.E.C., and a year ago that was followed by the Atlantic Treaty. Lastly, comes the Council of Europe which met for the first time last autumn and has been very active in many of its committees since. I do not think the House will wish me to enlarge upon the origins of these bodies which should by now be quite familiar. The only thing I would say is that in judging of the measure of success to which they made claim one should note how very short a time most of them have been in existence. I think one can say that between them they cover every aspect—military, political and social—of the Western European problem.
  Before attempting to put my finger upon certain specific results which I think they have already achieved, I would like to refer to one general result which seems to me to be important and full of promise. As a result of the interlocking of all these organisations, there is already growing up a very large body of experts, officials, Ministers and latterly also Parliamentarians, who are becoming accustomed from day to day and from week to week to think beyond their own frontiers who are getting to know their

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  colleagues of other countries, to deal with them with the same problems but seeing them dealt with in a different perspective; are exchanging opinions and, what is probably more important, exchanging information with a frankness and intimacy which would certainly have been unthinkable only a few years ago. The effect of this very widespread co-operation goes far beyond Western Europe itself and includes in particular the United States of America and Canada. The process is continuous and cumulative. I think one of the problems which now faces us in this field is to try to extend the sense of European comradeship into the domain of public opinion where so far the idea has had only a very limited impact.
  It is the O.E.E.C. which has been laying the economic foundations for Western co-operation. Its achievement is already far more than the mere distribution of Marshall Aid. Since it was set up early in 1948 there has been a great increase in European production. The dollar deficit has fallen from 8 billion dollars to 41 billion dollars for 1949–50. I think it is reasonable to claim that the United States initiative which was followed up at the American end through the Economic Co-operation Administration, and O.E.E.C. in Europe, has already fulfilled the immediate short-term purpose of staving off collapse. Now we reach a second phase, and we have to look further ahead particularly with a view to creating conditions in which progress can go on after the end of Marshall Aid in 1952.
  The emphasis in O.E.E.C. has, therefore, shifted to the liberalisation of European trade and to the creation of a system of European payments. I think Western Europe illustrates very well the impossibility of treating any area, even a considerable area, in isolation. Nearly all the leading members of this group of Western nations have overseas territories to consider, and all of them have old-established ties with the rest of the world. We, above all, as a member of a Commonwealth which spans the world and which includes dollar countries, as, at the same time the centre of the sterling area, and as, perhaps of all countries, the one with the most intimate ties with the United States of America, are compelled to look for a form of co-operation in
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  Europe which will have a genuinely liberating effect and which will not lead to the damming up of existing channels of trade in many parts of the world as the price of liberalisation within the more restricted area of Western Europe.
  On defence, in the Five Power Treaty of Brussels the ideas have already broadened out beyond the Western European area itself. They have broadened out into the Atlantic Treaty in which the United States and Canada are both associated. The achievements here are not inconsiderable. I need not go into them in detail. They were mentioned at some length by my right hon. Friend the Minister of Defence in the recent Defence Debate. There are plans already agreed by the Brussels Powers for Western defence. Military supplies for the first time are now being considered from a European standpoint, and on the basis of the plans that have been agreed the President of the United States has already authorised military assistance to Europe under the United States Mutual Aid Assistance Act.
  The financing of this joint defence effort is to be discussed at a meeting of the Consultative Council with the Ministers of Defence and Finance in Brussels in the middle of April.
  Finally, of these organisations, there is the Council of Europe. My right hon. Friend is going to Strasbourg tomorrow to attend the Committee of Ministers and, therefore, at this stage of the Debate I propose to say very little about it. I will refer to it a little later, particularly in connection with its relation to Germany.
  I hope I have now said enough to show that the foundation of Western unity is being steadily laid. In all the activities I have described the United Kingdom has played a leading part. Our experts have been second to none in the fertility of their ideas, particularly in the economic field. We are quite ready to accept further steps in this matter, but we do want to see our way at each step. We do not believe that the unity of Europe can be achieved by coining slogans or by formulating paper schemes before a practical basis of co-operation has been worked out.
  I think the House might like to consider the programme of activity during the very immediate future, which is immense. In the next 10 days we have, first, a meeting

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  of the Anglo-French Joint Economic Committee in London. This was one of the earliest bodies to be set up in Western Europe—before O.E.E.C.—and in mentioning it I should like to express my agreement with what was said by the right hon. Member the Leader of the Opposition about Anglo-French co-operation being one of the main pillars, if not the main pillar, of co-operation in the whole of Western Europe. Then, still in the same week, we have the first Meeting of an Anglo-Scandinavian Economic Committee, a Committee which has been set up in response to requests from O.E.E.C. for regional associations to deal with liberalisation of payments and of trade. We have the Committee of Ministers of the Council of Europe meeting in Strasbourg, the Defence Ministers under the Atlantic Pact meeting at the Hague and, next week, we have the Council of the O.E.E.C. This is the programme for 10 days only and I think hon. Members in all parts of the House will realise that it is as full a programme of co-operation as could be practically carried out. That is where the work really gets done, and I can assure the House that in meetings of that kind the United Kingdom has at all stages played a leading part.
  As the right hon. Gentleman said, a most important aspect of European co-operation is the part to be played by Germany. The basis of His Majesty's Government's present policy is the Petersberg Agreement signed between the three occupying Powers and the Federal German Government on 22nd November last year, just after—two or three days after—the last occasion on which we had a Foreign Affairs Debate in this House. I think I should quote just one or two of the statements made in that Agreement. First of all, it was agreed that:
  "The primary objective is the incorporation of the Federal Republic as a peaceful member of the European community, and to this end German association with the countries of Western Europe in all fields should be diligently pursued by means of her entry into the appropriate international bodies and the exchange of commercial and consular representation with other countries."
  Again, it was said:
  "The High Commission and the Federal Government are agreed to promote the participation of Germany in all those international organisations through which German experience
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  and support can contribute to the general welfare."
  That was the policy statement agreed by all at Petersberg. That does not imply that we have given up hope that one day all Germany will be treated as a single unit. What it implies is that for the time being Soviet policy has put that objective outside our power to implement and, therefore, we must immediately make such progress as we can in the West.
  We should, I think, realise that the arbitrary division between East and West poses particularly intractable problems for the Federal German Government, more than it does for countries which are not actually divided by the Iron Curtain. There is, first of all, the question of traditional trade outlets which have to be switched from one channel to another. Then there is the vast influx of refugees, with all the consequential difficulties of unemployment and accommodation. There is also the maintenance of the western sectors of Berlin in which, of course, the Western German Government have the fullest support of the Allies but which inevitably places an additional burden upon their economy.
  The economic policy to meet these difficulties is, in the main, a German responsibility, but the hard facts must, I believe, be faced in any discussion of the policy of the Western Powers towards Germany. I think the United Kingdom Government cannot be accused of having been unsympathetic to a reasonable restoration of Western German industry, but on this topic it is important that we should keep a level head and not swing from one extreme to another—from the extreme of severity, which was advocated in some quarters shortly after the war, to the other extreme of sentimentality. We and, even more, our friends in Europe are entitled to adequate guarantees against the revival of the German war potential, and until we can be satisfied that Germany is able and willing to take her place as a part of the Western community we do not intend to be stampeded into ill-considered action.
  Germany is already participating in the O.E.E.C. Recently she has entered the International Wheat Agreement and we hope that co-operation on economic matters of that kind will steadily grow. Her admission to the Council of Europe, which was referred to by the right hon.

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  Gentleman, is an important question of topical interest, As a result of the decisions of the Committee of Ministers and of the Standing Committee of the Consultative Assembly last November, it has been open to the German Federal Republic as well as, of course, to the Saar, to apply for associate membership of the council. In reaching this decision the Standing Committee stated:
  "It is essential that the German Federal Republic should state that it is willing to abide by the provision of the Statute of the Council and to give clear proof of this desire to do so."
  So far, no application has been made and the German Government has not felt able to put this matter before the Bundestag. Although we would be very happy to see them take their place in the Council of Europe, we have not sought to influence their decision. It is our view that Germany has very much to gain from association with the Western group of nations, but it is important that in joining the Council she should fully accept the terms of the Statute and all the consequent obligations. In so far as any hesitation on her side may be due to the recent agreements between France and the Saar, we have already stated our view that we consider this difficulty to be unreal.
  I appreciate that in speaking as I have spoken today I have failed to cover many problems of high importance, but I have tried to pick out some of the most outstanding examples of the policy we are seeking to pursue throughout the world. The present unhappy division of the world was not of our seeking. We deeply regret it and we must never forget that it is our duty, as loyal members of the United Nations, to promote co-operation on the basis of one world, through United Nations machinery wherever there seems any possibility of progress by that method.
  There are many problems which, even now, are being handled by those methods and a measure of success is being achieved. We have, however, been driven by the policies of some of our fellow members in the United Nations to combine with more limited groups of nations who are like-minded with ourselves in order to strengthen and defend the democratic way of life and to try and give a new coherence and vitality to the economic and social life of what we call the free world. That is the purpose of the
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  Atlantic Treaty and of all the constructive efforts which we are now making, both in Europe and in Asia. In our view only the success of this policy offers any hope of the eventual breakdown of the existing barriers and of the renewed application of the principles decided upon at San Francisco upon a world scale.
  The community of nations with which we are working has very great resources. It includes some of the most experienced and skilled peoples in Europe, Asia, and America. There is, therefore, I think, no doubt that we can command all the elements needed for success. We need feel no surprise, let alone despondency, if the process of the changes we are trying to bring about sometimes seems laborious. Mr. Hoffman was recently quoted as having said:
  "We want Europe to accomplish in 25 months what might, under less compelling circumstances, easily require 25 years."
  What is true of Europe is doubly true of many of the less developed areas. We are all trying to telescope history in this way. Indeed, the pace of progress in the technical field demands that we should attempt to move with corresponding speed in our political and social organisation. We have already moved far since the war, and we must keep moving if we are to fit our institutions, both national and international, to the changed needs of the peoples in the modern age.
  5.11 p.m.
  Mr. Julian Amery: The natural diffidence which any man must feel who speaks in this House for the first time is heightened in my case by the apprehension that some of the things I want to say today may be thought more controversial than is becoming in a maiden speech. If so, I can only hope that the sense of deep and urgent conviction which alone leads me to speak today will justify the House in granting me that measure of indulgence which is traditionally accorded to a maiden speaker.
  As I see it, the central fact of the international situation today is that we are at war with Communist Russia. It is still a cold war, thank God; but it is a war none the less; and unless we recognise it as such we are unlikely either to secure a satisfactory peace or to prevent it from deteriorating into a shooting war. In these circumstances it seems natural

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  that we on this side of the House should ask the Government to tell us what is their plan, what is their strategy, for the conduct of this cold war. The Minister of State has taken us on a round of interesting and important problems, but I was not myself able to disengage from his speech any coherent plan or strategy for confronting the dangers that loom on the international horizon.
  I have heard the Government's policy sometimes described as one of containment—containment of Russia. I confess that it seems to me to be rather stretching the meaning of words to apply the term "containment" to a policy which has already permitted the Sovietisation of half of Europe and the whole of China. Was it containment when we allowed our warships to be mined in the Corfu Channel with impunity, and, four years later, are still awaiting compensation for the deaths of 40 British sailors? Was it containment when we permitted the murder of Petkov, the imprisonment of Cardinal Mindszenty, and the overthrow of democratic and constitutional life in Bulgaria, Rumania and Hungary, in direct contradiction of the armistice terms to which we were a party? Was it containment when we allowed the Czechoslovakian democracy to be overthrown and our friend and ally Mikolajezyk to be driven into exile in direct contradiction of the Yalta Agreement? Was it containment when our Government stood by and did nothing when the Communist armies overran the whole of China, including British interests which, at the present rate of the pound, cannot be valued at much less than £400 million?
  It seems to me that the term "containment" is not one which can be applied to the policy which the Government have pursued. At times, indeed, their policy has seemed suspiciously like one of scuttling away from our responsibilities behind a smoke screen of bluster. It may be that the Foreign Secretary has acted in the hope that, if only we could trade space for time and delay bringing matters to a head for long enough, unforeseen developments might divert the Soviet rulers from their aims of world domination. In the past, when we stood at the summit of the world and enjoyed an immense margin of power, there was much to be said for waiting upon events, but today, as the weakest of the three
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  great Powers, we must anticipate events if we are to survive them. By all means let us hope and pray that the Chinese dictator may turn out to be a second Tito, or that there will be a palace revolution in the Kremlin; but to base your policy on the hope that "something will turn up" is to degrade yourself to the level of Mr. Micawber.
  Recrimination has its uses if it prevents the repetition of errors, but I do not want to dwell on the errors of the past. Instead, I should like to make one or two constructive proposals about our conduct of the cold war. The first point I wish to make concerns the general defence of Western Europe. I am one of those—and I believe we are a majority on both sides of the House—who believe in the conception of a United Europe, not merely as a means of defence against the Soviet Union but as an end in itself.
  Much can be done—something is already being done—to secure European co-operation in the economic sphere; but it seems to me that in present circumstances, in the face of present dangers, there is an even greater opportunity to secure closer European relations, closer European co-operation, in the sphere of defence. For this reason it seems to me to be a matter for regret that the staff set up at Fontainebleau under Lord Montgomery has not yet developed into the supreme command of a genuine European army. No national differences or personal rivalries ought to be allowed to stand in the way of such a development.
  The sooner a European army exists the easier it will be to raise those German contingents without which we cannot hope to defend Europe against attack. This whole question of Germany is so intimately bound up with that of the union of Europe, and this union of Europe depends, in turn, so much upon matters of defence that it seems to me a pity that the whole subject of defence should have been excluded from the purview of the Council of Europe. Here is a matter which might well be reconsidered.
  The next point which I want to make is this: you cannot win wars, whether they are hot wars or cold wars, by remaining permanently on the defensive. At some point you have to go over to the attack. So far we have followed purely defensive tactics, and the results have not been very encouraging. Surely the time

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  has now come—indeed, is overdue—when we must carry our ideas beyond the Iron Curtain and seek to break the Communist monopoly of Eastern Europe and of China by encouraging opposition, and the setting up of resistance movements, on the other side of the Russian front.
  This, after all, is only what the Soviets have been doing for four-and-a-half years in Western Europe and South-Eeast Asia. The Soviet Union has divided Europe and divided Asia by the cold war. We shall only re-unite them if we also take the initiative in the cold war. It will be objected, I know, that such a policy as I describe—one of taking the offensive in the cold war ourselves and building up resistance movements beyond the Iron Curtain—would lead to war. I do not believe it. If Stalin wants war, there will be war; but he is not going to be provoked into starting a war just because we give him a taste of his own medicine.
  The truth is that if the Russians have not pressed matters even further than they have it is because they are afraid of a war, and they are afraid of a war because they still believe they would be defeated; and they fear defeat because of their temporary inferiority in atomic weapons. So long, indeed, as the United States had the monopoly of the atomic bomb there was no danger of war at all. The military superiority of the West was absolute. Now, however, that the Russians have also discovered the atomic bomb, that superiority has become merely relative. The Russians may never catch up with the American lead in this one weapon. Equally, it may not be long before their smaller stock of atom bombs matched to an otherwise superior military machine may give them an overall superiority. If that day comes, and please God it never will, it will mean a shooting war.
  For some time, however—and, as the Leader of the Opposition indicated, it may be a long time—American atomic supremacy, reinforced by the discovery of the hydrogen bomb, will still stand between the Red Army and the conquest of Western Europe. So long as this situation exists, we can negotiate with the Russians from strength. It must be the task of statesmanship, therefore, to insist upon a settlement with the Soviet Union while there is still time.
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  What should be the conditions of such a settlement; what, in fact, should be our war aims in the cold war? The root of the trouble—the cause of the cold war—lies in the enormous expansion of Russian power. In the past five years, as Commissar Malenkov pointed out in a speech last October, the Soviet rulers have increased the population under their direct or indirect sway from 200 million to 800 million. They have secured the services of German and East European scientists, officers, technicians and skilled workmen. Their resources have been enriched by the addition of Silesian industry, the Skoda works, the Roumanian and Austrian oil wells, the mineral deposits of Poland and the Balkans, the uranium of Saxony and Czechoslovakia, and the coal and iron of Manchuria. If we add to this the strength of the Red Army and the Red Air Force and the subversive power of the Communist parties all over the world, the conclusion to be drawn is that the Soviet rulers already possess so great a strength that, but for their temporary deficiency in atomic power, their dream of world conquest might already be in sight.
  In these circumstances, surely, the essential condition of peace must be to reduce the power of Russia within proper bounds. We do not wish, and we cannot want, to dismember the Soviet Union or even to smash her regime. What we do want is to see her power reduced within proper bounds. This means that the Red Army must get back behind the Curzon line and that the monopoly of the Communist parties of the countries of Eastern Europe must be broken. Of course, it is not enough merely to compel the withdrawal of the Russian Armies and to break the monopoly of the Communist parties; we have to fill the vacuum created by the destruction of Germany. We have got to build a Europe, not just the truncated Western Europe of today but a whole Europe which will embrace all the countries which by tradition, by history and by interest look to the West.
  How are these aims to be fulfilled? Plainly, the first step must be to convince the Russians that we are determined to accept nothing less than the reunion of Eastern Europe to the body politic of Western Europe as it stands today. This calls for negotiations at the highest possible level. If such negotiations should

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  prosper, they will bring immense blessings to all mankind; if they should fail, then, at least, we should all know where we stood and could make our plans accordingly. Nothing but good, it seems to me, can come from such initiative, and that is why, along with many others, I must join in deploring the action of the Foreign Secretary in describing as a "stunt" the proposal made by my right hon. Friend the Leader of the Opposition in his speech at Edinburgh.
  The Prime Minister has told us that such negotiations should be conducted through the usual channels: that is the United Nations. But the negotiations with the United Nations have been going on for four-and-a-half years, and they have brought us to the brink of war. There is no more dangerous and perhaps no more fatal error in politics, and especially in foreign affairs, than for a Government or a Minister to remain tied to the carcass of a dead policy.
  The Leader of the Opposition, in the first volume of his memoirs, described the Second World War as "the unnecessary war." The war into which the Socialist Government are slowly drifting might be called with equal justice the "inexcusable war." For four years the Foreign Secretary has known the nature of the Russian danger. In association with his American colleagues he has possessed the power to conjure that danger away. So far, he and they have lacked the will to act. Sooner or later—and the time may not be so far removed—he will also lack the power. Such persistence in error is termed by Christian moralists the sin against the Holy Ghost. In the whole catalogue of sins it is the hardest to excuse. All sins, of course, may be forgiven if repentance comes in time, but time is the essence of the situation. Last year, I was discussing these things one day with a friend while walking up and down a garden. We stopped for a moment to look at an old sun dial and on its edge I read this motto, and I commend it to the Foreign Secretary:
  "It is later than you think."
  5.29 p.m.
  Mr. Blackburn: It gives me great pleasure to extend to the hon. Member for Preston, North (Mr. Amery) my congratulations
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  on a very interesting maiden speech and one which was excellently delivered. He will not, of course, expect everyone on this side of the House to endorse every word that he said. It used to be a tradition, if I may say this to the hon. Gentleman with friendship, that maiden speeches where not controversial; but the hon. Member, coming into this House after such a controversial father, can hardly be expected to speak without arousing comment. May I say one other thing in relation to his father, and that is that he is greatly revered on these benches for the part he played in the Debate which led to the Labour Party joining the Coalition in 1940 and to the right hon. Gentleman opposite becoming Prime Minister.
  I wish to say a few words today upon the main topic which was dealt with by the right hon. Member for Woodford (Mr. Churchill). It appears to me that time is not on our side. During the last three or four years we have too easily been led into the assumption that the months and years would go by and that during that process we would become stronger. That was a generally accepted assumption throughout the whole of last year, yet the two major events of last year were, first, the Soviet acquisition of China, and secondly, the Soviet development of the atomic bomb.
  I appeal to my right hon. Friend the Foreign Secretary to recognise this fact: that if there were a plebiscite in this country—although we are not in favour of plebiscites—at least 90 per cent. of our people would be in favour of some new approach to this vital issue of the development of weapons of mass destruction. It really has seemed as if we were almost helpless spectators of the last act of a Greek tragedy, with modern industrial civilisation moving to its doom by methods of its own creation. We as human beings, have the opportunity to take an effective part ourselves. I suggest that we must be willing to take risks for peace just as we took risks for war. The greatest risk of all is to do nothing, and at this time we are faced with a situation where, for two years, we have done little or nothing before the United Nations. Some new approach is needed, as has been said by almost every independent expert on the subject, if we are to have any hope of averting what is a manifest drift—we hope not a drift

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  towards war, but nevertheless a manifest drift.
  I want to put forward one or two practical considerations. The first is this. I think that we have been far too greatly overshadowed by the United States of America. Although it was vital for the Foreign Secretary to keep the United States of America with us, and although I personally have great admiration for the way he did it, I feel that our point of view is not sufficiently considered. The other day, the Prime Minister quoted a very important book by Dr. Vannevar Bush. In the first place, that book is already out of date because the Soviet Union developed the atomic bomb years before Dr. Vannevar Bush expected them to do so. I can give my right hon. Friend the specific quotations if he wants them; I have them with me. In the second place, the book was manifestly written from the point of view of the United States of America.
  Let us at least remember this vital fact. We have at the moment in East Anglia squadrons of American bombers which, to everybody's knowledge, and to the knowledge of the Soviet Union, could carry atomic bombs to Moscow. In other words, we have been willing to accept the position of being the front line of defence in the whole concept of Western Union and American Western Union Defence. Now that is a tremendous contribution upon our part towards this whole cause, and I do not believe that in the defence sphere we have yet received adequate recompense for it from the United States.
  I am not putting this forward in any defeatist spirit. While the British Isles are more vulnerable to atomic attack than any country in the world, it is nevertheless true, in my opinion, that the British Commonwealth and Empire as a whole will survive best out of the three major Powers in the event of the appalling catastrophe of an atomic war. We in the British Isles are the most vulnerable country, but the Commonwealth and Empire as a whole is the least vulnerable Power because it is the most widely dispersed. Therefore, we have every right to speak and to expect our views to be heard. The Prime Minister said the other day, when asked about this: "Well, observe what I have done
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  in the past. I was responsible for promoting the Atomic Energy Commission at the conference which I called with President Truman and Mr. Mackenzie King." I think we all agree; but the point is that nothing has been done since the deadlock; and, in fact, the deadlock took place in 1947.
  A somewhat embarrassing fact is that the Soviet Union have gone much further in the direction of co-operation in the field of atomic energy than most people appear to realise. I speak as a very strongly anti-Soviet Member of this side of the House, as I think my hon. Friends will agree, but we must tell the truth about this matter because it seems to me vital that we should face it. I have here the exact proposals made on 11th June, 1947, by Mr. Gromyko, and they seem to me to go a very long way indeed. Let me read the first:
  "The mining of raw materials and every stage of atomic production should be under strict international control."
  That seems a fairly reasonable proposal which could be considered, and which could be a basis for discussion anyway. I do not want to go through them all, but a very important proposal is the seventh:
  "The inspectors"—
  these are international inspectors—
  "should have the right of free access to all mining and production facilities, and should be allowed to weigh, measure and analyse atomic raw materials and finished products."
  There are also in the Soviet proposals provisions for what I might describe as snap inspections; that is to say, provided reasonable cause was shown by any Power, under the Soviet proposals it would be possible for the international inspectors to go and inspect factories without prior specific notice having been given to the Power in question.
  In other words—it is a most embarrassing fact, but it is so—the main difference between the Soviet Union and ourselves in relation to the proposals of the Soviet Union and the Baruch proposals is this—and it is diverting: that the United States and ourselves insist on absolute internationalisation of all atomic production, and the Soviet Union takes its stand upon national sovereignty and says "We cannot accept anything quite so revolutionary as that." That, in fact, is the

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  main distinction between the United States on the one hand and the Soviet Union on the other. I therefore appeal to the Foreign Secretary: Let us face this problem; let us face it with a full knowledge of the facts; and let us face it with less secrecy.
  Again, another rather extraordinary fact is that this country, unwittingly, through certain atomic scientists, gave the whole of the secrets to the Soviet Union while we were refraining from giving those secrets to New Zealand, or France, or to our own natural allies. I therefore beg the Foreign Secretary to put the cards on the table face upwards in this matter. For instance, let us know where we stand in relation to the Soviet Union. As my information goes, there was an atomic explosion in the Soviet Union in August of last year, but since then, as I understand it, no atomic explosion has taken place. Now it is most important for us to know what the position is on that. Personally, I share the doubts of some people whether an atomic bomb was developed, and whether it was not a premature atomic explosion. But either way, it is most important for us to know what the facts are.
  Surely the history of the pre-war period, to which the hon. Member for Preston North, referred, teaches us how important it was for the public to be properly informed upon vital issues. As it happens, the right hon. Member for Woodford constantly came down to this House, spoke from these benches, and gave facts to the Government, with my right hon. Friend present and sitting on the Opposition Front Bench. Those facts were correct, but they were denied by the Prime Minister of the day, whether it was Mr. Baldwin or Mr. Neville Chamberlain. Now this time, if there is a risk of another war—we all hope that the risk is very small—let us have the facts; and let the facts be brought to the House.
  The two possible approaches on this subject are obviously either via the United Nations or the personal approach. I am in favour of the second, but I want to say just two or three words upon each. If the approach is to be made before the United Nations, it seems to me that there must be some basis for believing that it is a new approach. It is no good
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  merely throwing this matter once again to the very able men who have been considering it over the last three or four years, but who have been able to do nothing. It really is no good throwing this matter back to people who have already failed month after month and year after year. It must be brought forward at some dramatic level.
  I appreciate that a preliminary to successful drama is extremely hard work, but 99 per cent. of this hard work has already been done. I should say that 80 per cent. of it was done three years ago. Most of the scientists who did it went back to their universities, where they are now working, but they would be willing to be called back for a great, dramatic, hard-working new approach to this subject. I do not know a single newspaper in this country that has argued against a new approach of one kind or another. Over and over again, "The Times," the "Manchester Guardian," the "Daily Herald" and the "News Chronicle" have spoken of an immediate new approach to this subject. I want to know what is being done, because as the right hon. Gentleman quite rightly said, when the Prime Minister was asked the question during the election he said that there was to be a vigorous effort at the United Nations, and when I asked the Foreign Secretary last Wednesday what was being done, his reply was: What is the use of entering into agreements with people when you have no reason to believe that they will keep them.
  I accept the fact that the Soviet Union in the past have not shown themselves very anxious to keep agreements, but it is no good going to a conference with anyone on that basis. We have to go on the basis that there are some methods by which we can succeed in persuading the Soviet Union to do what they do not want to do. I was reading quite recently the book by Mr. Stettinius, the Secretary of State at the time of Yalta. It is an interesting book in defence of Yalta. Having read it, I came to the conclusion that although many mistakes were made at Yalta—and many of my hon. Friends, certainly the Minister of Health, took the view at the time that many mistakes were made—President Roosevelt and the right hon. Gentleman did persuade Stalin to agree to certain steps which he did not desire to be taken. I will give only one

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  instance, the proposals for free elections in Poland, which enabled Mikolajczyk, against the wishes of perhaps the majority of the Poles here, to go to Poland as Deputy Prime Minister. All that was part of these very difficult Yalta negotiations. I cannot believe for one moment that Stalin wanted him to go back to Poland, but he was prepared to negotiate. Unfortunately, the book shows that very soon after the end of Yalta he was sending telegrams to President Roosevelt alleging that General Eisenhower in Italy was "ratting" on the agreements which the right hon. Gentleman, President Roosevelt and Stalin had concluded.
  It is vital at all times to ensure that our point of view gets home to Stalin himself and is not misrepresented by minions, as the attitude of this country was misrepresented to Hitler by Ribbentrap, and as the attitude of this country has been misrepresented by Soviet ambassadors since 1945. Therefore, surely the vital issue is that we should make a new approach. I am strongly in favour of a personal approach for these reasons. The effective rulers of the Soviet Union are, without any question, the members of the Politbureau. Vyshinsky is not even a member. He is a man of great importance because, as we all know, he developed the technique of the trials which produce confessions. I am not suggesting he is not important, but he is not even a member of the Politbureau.
  Therefore, surely it is absolutely vital for us to get at the two or three men who actually control the Soviet Union. We do not get at these men even by conversations through the Russian ambassadors, nor by discussions at the United Nations, which have as their primary object a propaganda value, as the Foreign Secretary has so often said. I quite agree that the dangers are immense of entering into an agreement which the other side will not keep, but the stakes are so great that we must make our moral position unassailable. We must show that we have gone to every length, consistent with honour, to see that an agreement is reached which will help once again to give the world the hope of peace.
  I feel most sincerely that the risks of a further drift are greater even than the right hon. Gentleman indicated in his speech. I am somewhat pessimistic about the way in which matters are drift-
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  ing at the moment. I think it is essential—and here I accept the formula—that we should negotiate from strength and not from weakness. I believe we possess that strength today. According to every conceivable scientific estimate, we are still overwhelmingly stronger in atomic and other respects than the Soviet Union; but, as the right hon. Gentleman pointed out, in another three or four years the Soviet Union will have enough atomic bombs to wipe out every port in this country in advance of the declaration of war. There will be no declaration of war, but the bombs will perhaps be introduced into neutral ships and put over with a time mechanism in our ports at night. It is vital that a settlement should be reached with the Soviet Union before it is too late. I believe that the time factor is against us. I beg my right hon. Friend, in the short time that is available to us all, to reconsider this matter and to make some new gesture, some new approach, which will once again give hope to us all.
  5.46 p.m.
  Lieut.-Colonel Sir Cuthbert Headlam: I should like to associate myself with the hon. Member for Northfield (Mr. Blackburn) in congratulating my hon. Friend the Member for Preston, North (Mr. Amery), on his admirable maiden speech. I do so rather more gladly because I am a very great admirer of his father, whom we all knew so well and respected so much as a Member of this House. I notice that the hon. Member for Northfield took a somewhat pessimistic view of the situation. He begged us to avail ourselves of the time that is left to us to come to terms with the Soviet Union. He suggested that he preferred it should be done in the way in which my right hon. Friend the Member for Woodford (Mr. Churchill) proposed during the election, and that is by personal interviews on the highest level rather than through the United Nations.
  I am inclined to think that that is the right way of advancing to some kind of agreement, if it can be arrived at, rather than by the methods that have been tried so far. What is disturbing me at the present time is what I found to be the case during the General Election. My experience was that the mass of our people are failing to appreciate or to take

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  any particular interest in the present state of world affairs. They do not seem to understand that there is the possibility of a happy outcome to the present deadlock. Still less do they visualise the appalling disaster which may lie ahead of us unless we can come to terms with the Russians before it is too late.
  I think that the Government are largely to blame for having failed to make the public appreciate the full implications of the present international situation. There was scarcely a word about foreign affairs in their election manifesto, and they did nothing to explain to the people how the present cold war may soon develop into another kind of war.
  "Russia is now,"
  as Field-Marshal Smuts said as long ago as 1943,
  "in a position which no country has ever occupied in the history of Europe."
  Whether the sweep of Communist expansion, so ominously like that of Hitler, for world domination can be peacefully checked depends primarily on the firmness, the wisdom and the far-sighted intelligence of the United States' foreign policy. It is all very well to say that we are being dragged along by the United States of America, but we must realise that in present conditions the United States are the leading country in the world, and we must more or less be guided by their foreign policy and shape it as far as we can in the way we think best.
  More than a century ago the acute and far-seeing French historian de Tocqueville wrote:
  "There are at the present time two great nations of the world … the Russians and the Americans …. The Anglo-American relies upon personal interest to accomplish his ends and gives free scope to the unguided strength and commonsense of the people. The Russian centres all the authority of society in a single arm. The principal instrument of the former is freedom, of the latter servitude. Their starting point is different and their courses are not the same. Yet each of them seems marked out by the will of Heaven to sway the destinies of half the globe."
  That was over a hundred years ago, and the situation which de Tocqueville visualised then should be clear to all of us today. Not only is the Soviet Union embarked upon a gigantic project of expansion exceeding anything ever contemplated by the Czars, but it has also
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  initiated all over the world an ideological competition with Anglo-American ways of life. Russia today is a far more potent influence than when the Czars were ruling the country.
  There are four main causes of this American-Soviet tension. The first is the belief of the Soviet ruling class that there is an implacable antagonism between the Soviet Union and the foreign capitalist world, and that war, therefore, is inevitable. Then the Americans are tired of the habitual bad faith of the Soviet Government, which has made it so notorious during recent years because of their absorption of other countries and the disregarding of treaties without scruple. Then again there is the employment by the Russians of the Communist Party as fifth columnists to ensure the penetration of their ideas into foreign countries. Lastly, of course, there is the conspicuous inequality which exists today between the amount of knowledge of the world the Soviet citizen has as compared with that of the American.
  What are the logical possibilities as regard the situation today? There are three possible solutions of world affairs, any one of which might save us from another great war. First of these seems to be that the Russians may succeed in converting the whole of the rest of the world to their own political ideology. The second is that the Russians may revert from their own accord to capitalism and willingly co-operate with the rest of the world. The third is that each side may concede to the other a definite sphere of influence, so that the world may become divided as it was in the Middle Ages between Christianity and Islam. If, on the other hand, there should be another war there are three further possibilities which have to be considered. The first is that the United States and the Western democracies may be victorious and establish an American world empire and the second is that the U.S.S.R. may be victorious and establish a Communist world empire. Finally, the war may be a draw with neither side winning and merely retiring to lick its wounds until war breaks out again.
  Let me take the first of these considerations, namely, that Russia may convert the capitalist world to its own way of thinking. I do not believe there is much chance of that, but it is highly probable

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  that the Soviet rulers may think they can do so and that is why they are waging the cold war. They believe they can achieve their ends without the trouble of fighting, and they are doing it by trying to push their way into every country and to work upon the masses of the population and win them to their own way of thinking. We must remember that the Russian economists are all convinced that sooner or later there must be a tremendous financial collapse in America and in the countries which depend upon American support. Such a collapse would give the Communists the chance to spread their Gospel successfully.
  The Soviet Government also believe that by working through the trade unions they may succeed in converting them to Communism. I cannot see any great sign of that in this country at the present time, nor have the Russians been successful in Italy and in France to the extent which they anticipated. Nevertheless it may well be that they still think they can achieve their ends by peaceful methods. As to converting the Russians to capitalism, we need not consider such a thing, at any rate so long as the present set-up exists in Moscow.
  The third possibility which, if adopted, might possibly save us from war for a long time, the conceding of a sphere of influence to the East and a sphere of influence to the West and keeping them separate and apart, might be the effective method. There are indeed some serious thinkers at the present time who believe that this is the only sane policy which can be adopted. I myself think that the shaping of the frontiers and other matters connected with trade, and the partitioning of Germany, China and Persia, would make it an impossible task to bring about that form of ending the present deadlock. It would certainly be a very arduous task for U.N.O.
  What would happen if the Americans went to war? I understand that the general opinion in America is that there will be a war and that it will end in an American victory. But even if the war were won by the Americans it would probably entail the temporary occupation of the European continent by the Russians, which, as my right hon. Friend the Member for Woodford said, would mean that the whole bourgeois population would be massacred or sent to
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  Siberia, and it would also entail vast dangers to the people of this country for, as the hon. Member for Northfield said, we are now in the front line of any war between America and the Russians.
  If this proved to be the case, the Americans would presumably establish a military government of the world and dictate the terms of the treaty of peace. This might ensure a long period of peace. If, on the other hand, the Russians were to win the war, it would lead to the establishment of a Communist form of government throughout the world. The only hope for any of us then would be to die as soon as possible for it would mean the end of freedom for us all. If that great war ended in a draw, it would be the most terrible possibility of all. If the war came soon, it might not destroy our civilisation, but if it were long drawn out it might well be the end not only of civilisation but also of the world. If there were bacteriological warfare, no scientist would venture to prophesy what calamities it might not entail.
  The only possible way of avoiding war between America and the Russians is to make it obvious to the Russians that they cannot be victorious. The Marshall Plan, combined with Western Union and the Atlantic Pact, give us the best hope of doing this, as well as of bringing victory to the West in the event of war. But it is a difficult task to make the Russians realise that they can be defeated in war. It may be that nothing can turn them from carrying on with their policy and yet to me one step seems to be advisable. It is for Great Britain and the United States of America jointly to inform the Russian Government as well as the Governments of the Balkan States, particularly those coterminous with Greece, that any further breach of treaty will be considered a casus belli, and so will any further political coup such as occurred in Czechoslovakia. It may be too late to save Finland, but it is not too late to save the other Scandinavian countries, Austria, and Western Germany.
  The object of our policy, therefore, must be to make the Russians realise that we mean business. I am quite certain that it is no good drifting along as we are drifting today. I urge that the right policy is to face calmly the grim factors of the international situation and to prepare for the worst. The general

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  policy of forming a Western Union is right, but it should be pursued more speedily and wholeheartedly. If it is to be successful and restore a more balanced equilibrium in Europe it must include Western Germany. There must be complete military and economic co-operation among the various States in the Union. We and they must be made to realise that without such co-operation there is little or no hope of escape from the destruction of Europe if war should come.
  Collective security must be a reality, and not merely a deceptive misnomer as it was before 1939. In declaring my hope and belief that what the Leader of the Opposition said may turn out to be true and that there is still time in which to prepare for all eventualities, I would add that I am glad to know that he, with his vast experience, is as optimistic as he has declared himself to be in his speech this afternoon.
  6.5 p.m.
  Mr. Hopkinson: This is the first time I have had the honour of addressing this House and I therefore ask hon. Members to accord to me the indulgence which they always so courteously grant to newcomers. I propose to address myself to one aspect, possibly the most important aspect, of the cold war. I refer to the struggle between the Western democracies on the one hand and Soviet Russia on the other, over the future of Germany. Whatever may be the dangers in South-East Asia and the Middle East, I think there is no doubt that the greatest threat to peace today lies in the existence of two German States incorporated in two hostile political systems. The danger, and if it were not so tragic the absurdity, of the situation can be seen in an extreme form in Berlin.
  The United States Secretary of State, Mr. Acheson, put the point very clearly when, in his recent speech in California, he laid down seven principles for the relaxation of tension with Soviet Russia. He put forward the following proposition: that Germany should be unified under a government chosen in free elections under international observation. This, he suggested, would be followed by a treaty of peace. This theme was taken up a few days later by Dr. Adenauer, and it is one to which I think we can all subscribe in
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  principle. Whether it is to succeed or not will depend upon how it is applied.
  The immediate reaction of the Government of the Eastern zone, presumably acting under the orders of Moscow, was one of hostility. This was perhaps natural, as the proposition, coming both from the United States Secretariat and Dr. Adenauer, removed one of the main weapons in the armoury of propaganda of the Communists in the Eastern zone. It does not mean that the proposal has been finally rejected. The Russians have for a long time toyed with the idea of a general withdrawal of occupation troops from Germany. They may decide that it would be worth their while to agree to the election of a government of a unified Germany, even if they did not like that Government or like the constitution under which it was set up. They would probably hope that the way would then be open for carrying out the so-called neutrality policy which many leading Germans on both sides of the Iron Curtain have favoured.
  I venture to suggest to the House that if this policy were adopted we should get the worst of all worlds. Germany would be in a position to play one group off against another. She would become a happy hunting ground for Communist propagandists. Moreover, unless the Western German Government were first provided with strong and well-equipped police forces, she would become the prey of the well-armed Volkspolizei now existing in Eastern Germany. Finally, it would mean the end of any plan for admitting Germany into the Council of Europe. For those reasons, a united Germany could not be allowed to remain in a vacuum.
  But if that is so, what is the alternative? In the first place, any proposal for unifying Germany must wait until after the admission of Germany to the Council of Europe. That must be the first step. I hope, as my right hon. Friend has said this afternoon, that it will be possible so to arrange matters that Germany is admitted as an associate member at the forthcoming meeting of the Committee of Ministers this week and can take her place at the Assembly at Strasbourg this summer. I hope also that Dr. Adenauer will not insist upon the conditions which he has announced as pre-requisite for German membership. The first two are

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  purely formal. The third, namely, that Germany's status as an associate member should be of short duration and that meanwhile she should be given an observer on the Committee of Ministers, seems to me a different matter.
  Until Germany has full control of her own foreign relations, she certainly cannot be admitted as a full member. To change this would involve an alteration of the Occupation Statute or the conclusion of a peace treaty. As regards the question of an observer, this appears to me to be simply an attempt to get round the terms of the Statute. I see no reason either to yield to German political pressure in this respect or to run after her, and I think this proposal should be resisted.
  Once the Federal German Republic is admitted to the European Assembly, the way will be open for discussions on the proposals which Mr. Acheson and Dr. Adenauer have put forward for the unification of the country. I will not attempt to go into this today, because it is a long and complicated problem. But if the prodigious difficulties which undoubtedly exist could be overcome, we should then be faced with the possibility of a peace treaty, and the moment we get a peace treaty the question of German defence automatically arises. We are then faced with the question either of leaving Germany as a neutral vacuum or of arranging some form of defence system for her. I believe that a vacuum would be wrong and dangerous, and I have no doubt whatever that the only way is to incorporate Germany in some form of global European defence system.
  Whether we like it or not, the Statute of Europe will eventually have to be altered so as to include defence. Once Germany has a peace treaty, it is only by providing defence on a European basis that the burden of cost and manpower will fall fairly on all those who are benefiting from it. Any such proposal must, of course, depend on removing the fears and suspicions of France. I believe, with my right hon. Friend, that there is a real opportunity today to wipe out the bitterness that four German invasions of France have left behind them. I believe that, with the support of the United States and with the close alliance of this country, France can afford to contemplate and even to welcome the
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  presence of Germany playing her full part in the Council of Europe.
  But the Council itself, it seems to me, cannot succeed unless there is unreserved British participation. It is not only a question of our endorsing or carrying out the recommendations made at the Assembly last year. A new attitude of mind towards the Council is wanted. The Council of Europe is a living force which must be accepted and supported by all its members not only in the letter but in the spirit.
  The difficulties of European economic integration and co-operation are, of course, very great. The political problems are perhaps still greater. They have to be met and overcome. We have often been told that the bar to full British participation in the Council of Europe is the fact that we are an Imperial Power. I do not believe that this is the case. Dominions statesmen throughout the world have made it quite clear that they understand the importance of European unity. Just as the United States now realise that they cannot a second time divorce themselves from Europe, so our own kith and kin in the Commonwealth understand that it is the failure of Europe to resolve her own problems which has brought their sons over here to fight and die twice in a generation.
  Therefore, anything that we can do to build up in Europe a system which will not only preserve peace but will extend the possibility of economic development for the Dominions themselves will be greeted by them with acclamation. It must be our task to associate our partners overseas in the work we are doing in Europe. It is the surest foundation of peace. I am convinced that the whole of Europe is waiting today for a lead from this country, as indeed they have been waiting for five years. We must not let this opportunity slip through our hands. I think it needs only imagination and courage for Britain, already the leader of a united Commonwealth, to become the leader of a united Europe and perhaps one day of a united world.
  6.16 p.m.
  Mr. Edelman: I am delighted to have the opportunity of following the hon. Member for Taunton (Mr. Hopkinson) and of congratulating him on his eloquent and well-informed

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  speech. He has, as we know, for many years been at the heart of public affairs. Indeed, it was only last year that I saw him at Strasbourg acting in an advisory capacity to the Conservative representatives. It is because he has had that particular experience that I am sure he will be able in future to make the same kind of contribution to our Debates as he has so successfully made in his maiden speech today.
  At Strasbourg last year I was one of those who at an early stage advocated the entry of Western Germany into the Council of Europe, and therefore I hope that I shall not be charged this afternoon with lack of sympathy with the idea of reconciliation between Germany, France and ourselves if I submit a few reservations about what was said earlier today by the right hon. Gentleman the Leader of the Opposition. I entirely agree with him that what we must have as soon as possible is a Germany working in peaceful co-operation with her neighbours in the interests both of herself and of Europe as a whole; but at the same time we must be careful that in making arrangements with Western Germany as it exists today, we are making arrangements which will be durable and of lasting benefit not only to ourselves and to Germany but to all those neighbours of Germany who in the past have had so much bitter experience of German aggression.
  The right hon. Member for Woodford (Mr. Churchill) quoted earlier what General de Gaulle said about the prospect of reconciliation and peace with Germany. I hope he has also read what M. Schumann said when he spoke to the executive committee of the M.R.P. only a couple of days ago. With reference to reconciliation with Germany, he said:
  "Il ne faut pas brûler les étapes."
  If I may translate that freely, it means, as hon. Gentlemen will know, that we must not proceed too quickly. M. Schumann was very cautious in making his submissions about the question of the future relations of France and Germany. He was extremely reticent about Herr Adenauer's proposal for a German-French union because he wanted to know whether Herr Adenauer really spoke for any large section of German opinion when he advocated union between the
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  two countries. We, too, ought to be very careful when we consider the future relations of Britain, France and Germany to make sure that we have something which is a reality and not merely something which we would like to see but which has no basis at all in fact. After all, the time may come when future German Governments will be only too anxious to renounce those decisions which Herr Adenauer has made which may have brought Germany immediate benefit but which, for the sake of her future interests, she may be only too willing to deny subsequently.
  I said originally that I would like to see Germany admitted as soon as possible into the Council of Europe, and admitted unconditionally; but I hope that the initiative in this matter will come from Western Germany and that Herr Adenauer will not insist on the condition, which he appears already to have laid down, that before Western Germany will enter into the Council of Europe she must have an invitation in writing.
  The right hon. Member for Woodford has spoken of the need to allow Western Germany to put her military forces or her manpower at the disposal of Western Europe. It is true that in Western Germany today there is the deepest anxiety about security against Russian aggression. The Germans are anxious about their future, but that does not mean that they would be willing to act as the mercenaries of Western Europe even in resisting the forces from the East. Not only is it undignified from a national point of view that the members of a proud and ancient race should have to act as mercenaries for an authority over which they have no practical control but, even if we can assume that the Germans would be ready to serve the defence of Western Europe in this way, it is quite clear that if we encourage the building up of trained cadres of German troops, the time may well come when those troops will turn on those who have trained them. There is absolutely no guarantee that in building up the military strength of Western Germany we shall not be building up forces which ultimately may rend those who made them.
  Indeed, if we look at the traditional strategic conception of German militarism, we find it has always been the belief in Germany that an alliance

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  of German manpower, of German military skill and courage and the economic resources of Russia would be sufficient to dominate the world. If we create that military force, of which the Leader of the Opposition has spoken before, there is no guarantee that such a force at some future date would not ally herself with Russia to the detriment of the rest of the world. That is something we have to bear in mind.
  Further, we have also to consider the question of whether the Germans themselves are prepared at present to burden themselves with the responsibility and the cost of a military force. May I quote a letter addressed to a German magazine called "Der Spiegel" published only the other day? The writer of the letter, who, from its context, is certainly no Communist, says:
  "Let us raise 30 divisions—but divisions which will serve the rebuilding of Germany. Let their Panzers be cranes, their infantry be builders, their generals be engineers and architects."
  That is the attitude of large numbers of Germans today who believe that, in view of all the economic difficulties from which Germany is suffering, she should not have to endure the further burden of a military force, and would much prefer that the resources which would be put at the disposal of a military force should be put at her disposal for the peaceful reconstruction of Germany.
  I have said before that I am in favour of the adherence of Germany to the Council of Europe but we ought to be clear that the political adherence of Western Germany is not enough by any means to solve the problems of Western Europe. Those problems are today what they have been for many years, economic problems. The existing dispute between Western Germany and France about the Saar is essentially an economic dispute. Although France has insisted that the Saar should be admitted into the Council of Europe as a quid pro quo for the admission of Western Germany into the Council of Europe, and although that insistence has been intended primarily to soothe the susceptibilities of Frenchmen who are afraid of or who dislike the admission of Western Germany into an international organisation without some obvious corresponding benefit for
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  France—despite the fact that a bargain has been made, the real difference between France and Germany about the Saar is an economic one.
  The French are anxious to obtain the whole of the Saar because they realise that unless they can marry the coal of the Saar with the ore of Lorraine, their steel industry will not have the means of production essential for its vitality. The Germans, for their part, resent intensely that in the Ruhr there should be an international authority while the other parts of the great nexus of industry—the Saar, Lorraine, the south-east basin of Belgium—remain under private control and are able to pursue their own policies.
  I come to the point therefore that what is required in Europe if Western Europe is to be strong is the integration of the economy of Western Europe. "Integration" is a jargon word which has been much misapplied in the last year or two. Americans have been coming over—American officials in particular—urging Western Europe to integrate, but what many of them have been putting forward is the reverse of integration. Americans at international conferences, in defining what they meant by integration, have said that they meant the complete liberalisation of Western European economy. We all know that once there is complete liberalisation, once there is that completely free competition which the Americans would like to see in Europe, we would have not the integration of European economy but rather its fragmentation. If, instead of those great areas of productive industry, such as the Saar and the Ruhr, pursuing a common European policy, there is this so-called free competition, there will be both political and economic harm to Western Europe.
  One of the main objectives of the Council of Europe at its next meeting must be to set up European institutions which will be not only the best functional means of producing the greatest economic benefit for Europe, but which will also have the effect of knitting together those countries of Western Europe which today are mutually hostile and, what is more, hostile because they are economic competitors.
  For the last five years we have been in the dilemma that in order to build up and to raise Germany from the condition

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  of defeat, we have had simultaneously to build up against ourselves a most serious competitor. Now that the sellers' market is coming to an end, we are beginning to realise how, in building up German industry quite independently of our own and that of France and Belgium, we have ourselves raised up a competitor who, particularly in manufactured goods, is likely to do Britain and her Allies great harm in the coming months and years unless we do something really to integrate the economies of the countries of Western Europe. I do not want now to give numerous examples because this is not primarily an economic Debate, but everyone knows that in Germany the machine tool industry, the motor industry and the engineering industries, stimulated by capital from abroad, paying wages which are below the trade union rates in this country, are entering the markets of the world as most serious competitors of British industry.
  I have always maintained in this House that I want to see Germany standing on her feet, prosperous, with her people enjoying a high standard of life. To me, however, it seems quite clear that if Western Germany is to be made viable by means of her export trade under the present dispensation, it can only be made viable, and a high standard of life for her people can only be achieved, at the expense of the standard of life of the people of Britain, France and Belgium now in competition with Western Germany.
  The question remains, therefore—is there something which can be done in order to co-ordinate the economies of the countries of Western Europe? I submit that what can be done is something which has in the past been urged on all sides of the House, and notably by the hon. Member for Aberdeenshire, East (Mr. Boothby), whom I see in his place. It is quite clear that one of the first things we must do is to plan the capital investment of Western Europe, and the only way in which that can be done effectively is by having it planned under a suitable European authority.
  Mr. Boothby: Hear, hear.
  Mr. Edelman: So far the only authority, or at least the only body which exists,
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  which is potentially capable of preparing the plan of investment for Western Europe as a whole is the Council of Europe, which I hope in the very near future will be strengthened and fortified by an addition of power.
  The second thing which the Council of Europe must seek to do is to try to achieve some division of labour as between the different countries of Europe. One of the greatest difficulties which we in Western Europe face today, particularly following the partition of Europe through Russian intransigence, is that we all are trying to make similar products and to sell them in identical markets. If we continue to pursue this course, the benefit of some can only be achieved to the detriment of others. Therefore the only way in which we really can use the total productive effort of Europe as a whole is if all the countries concerned, under the aegis of the Council of Europe, using their professional associations, whether of employers, trade unions or technicians, and preferably of all in combination, get together and work out a plan for the whole of Western Europe which will permit of specialisation, will encourage standardisation and will enable all of us to produce what we can and to sell our products in markets, not in competition with each other, but by agreement with each other.
  I do not myself believe that it will be possible in the near future to attribute to any European authority any substantial part of our sovereign power. I believe that our planning in the West must be planning by consent. If we look at the picture of Eastern Europe, where an Eastern union has been effectively formed, we find there that the Soviet Union by its autocratic power has been able to co-ordinate the economies of the countries of Eastern Europe simply by telling them what they must do. We in the West neither want to, nor can we, follow that policy. Our planning can only come by means of an agreement.
  I want therefore this afternoon to assert what the Labour representatives at Strasbourg asserted last year, an assertion for which, incidentally, they were much misrepresented. It is that while we believe in the co-ordination and the integration of Western Europe, we believe that that integration can only come about by agreement between the countries concerned.

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  We do not wish to attribute any of our national Sovereign Power, at this stage, at any rate, to any super-national European authority which will be able to dictate to us in this country what we should do.
  It was for that reason that Britain, through her Labour representatives, was accused of dragging her feet and of not being enthusiastic about the conception of Western Europe, but it is precisely because we were then, and still are, enthusiastic about the idea of Western European integration that we want it to be effective. We do not, and did not at that time, want to deal with an ideal pattern for Western Europe which could not be realised. What we wanted to see was the steady building up by agreement of a system of planned economic co-operation which would, in fact, be effective.
  Before I conclude I want to say one word about the relations of Britain with Europe and the Commonwealth. I do not for one moment believe that there is anything inconsistent between the idea of a United Europe and Britain's having strong relations with the Commonwealth. Britain and the Commonwealth together with France and the Union Française, form two great areas of power which guarantee the efficacy of Western Union. We are not complete in Western Europe in ourselves. We will always depend on our access to the markets of the world, and in particular to the markets of those territories associated with the major countries in the Council of Europe.
  I emphasise again, therefore, that the conception of a United Europe is in no way inconsistent with the idea of Commonwealth or Empire. By our associations with Europe, the Commonwealth, and the territories overseas of our Allies, we have a great accretion of power. With that power we can confront the Soviet Union and thus not only preserve peace, but also build up the whole of Europe and the countries associated with us for our collective prosperity.
  6.40 p.m.
  Mr. Hamilton Kerr: As the first speaker on this side of the House after the admirable maiden speech of my hon. Friend the Member for Taunton (Mr. Hopkinson), may I add my con-
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  gratulations to him? The Minister of State earlier in the Debate said that in the free Parliaments of the world we have now Parliamentarians who can think beyond their own countries. Doubtless in the coming months, we shall have difficult situations discussed in this House, and therefore we shall be fortunate to have the presence of the hon. Member for Taunton, who can give us the benefit of much experience and much good advice.
  The hon. Member for Coventry, North (Mr. Edelman), said that we should proceed slowly when we consider Germany. I imagine he conceived that Germany might follow the traditional policy of Bismarck of playing off the East against the West and the West against the East. But that is only likely to happen if Germany is left alone in the centre of Europe. If the economic interests of Germany are tied to the West, she is more likely to fit in the structure of Western Europe.
  Popular opinion supports the idea of hon. Members delivering their maiden speeches, suffering excruciating tortures of nerves, but I submit that an old and battered "maiden "such as myself has lost none of his initial nervousness. I had armed myself in fact with a small bag of sugar, carefully accumulated over the week-end, to sustain my nervous energies. We are told that sugar transforms itself into energy within 20 minutes and I had been trying to make a careful calculation when to pop the last bit of sugar into my mouth in order to obtain the maximum nervous energy when I was fortunate enough to catch your eye. Mr. Speaker.
  When we consider questions of foreign policy, we should first ask ourselves what is the objective of our foreign policy. Is it peace? Is it security? I believe the objective of our foreign policy today transcends both these. It is nothing less than the defence and maintenance of the democratic way of life. We believe that the democratic way of life provides the one and only political climate in which men and women can grow as individuals, develop their talents and thereby help the progress of the world. I believe that experience teaches us that the nations which have longest influenced the course of events and maintained their power have done so not merely by exercising

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  material power, but, above all, moral power.
  If we look at the history of Rome, we see that the sea command of the Mediterranean fortresses along the frontiers were the material supports of Roman power, but Rome enjoyed the loyalty of her subjects for centuries, for she employed moral power in the rule of law which prevailed in her dominions. Was not the same fact likewise true of our own power in the 19th century—command of the seas, fortresses on the trade routes, and an army which was a mere police force in outlying areas? These were the slender supports which maintained the Pax Britannica, but at the same time we exercised moral power because our statesmen everywhere allied themselves with the rising forces of democracy in Greece, Italy and South America.
  I believe that more than ever today, if we assume that our chief objective is the maintenance of the democratic way of life, that material and moral power must be mobilised as fully as possible. After all, we the democracies can offer the nations far more than the Communists. The Communists can only offer the peoples of the world the position of slavish satellites, but we can offer the nations of the world freedom and nationhood if they remain inside the democratic group. That is understood in Europe, but not so much in Asia, where the newly-emancipated peoples have often been all too glad to see the occupation troops disappear round the bend of the road; but unless defences are organised, that road will not long remain empty. Very soon those peoples may see tanks marked with the hammer and sickle, followed by the police vans of the secret police.
  If we assume that our objective is the defence of the democratic way of life, we should once again make plain to the world, if necessary in the form of a solemn charter, that liberty and nationhood can only be achieved by the nations of the world if they combine in defence and freedom. It is all very well to talk of defence of freedom, but what about the defences which are to support freedom? May I make a suggestion? During the course of the last war two sovereign Powers, the United States and Great Britain, freely entered into an agreement for the lease of bases to protect the Eastern
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  seaboard of America and the approaches to the Panama Canal. Would it not be possible to persuade, say, the peoples of the East to lease bases, not to a former occupying Power, but to the free people of the world. Unless some form of defence is organised we shall see the Communists taking the rubber and tin of Malaya and the rice bowl of Burma, and not only will the economy of the West receive a mortal blow, but Asia can also be held to ransom by starvation?
  Do not our interests in the Middle East also suggest that we should support Turkey? The Middle East is vital to the free democracies, because it is the area of oil, which drives our aeroplanes, ships and tractors. It will remain so until the time comes when in the atomic age, a small amount of energy can drive the "Flying Scotsman" from London to Edinburgh. I therefore trust that His Majesty's Government will at all times support Turkey to the fullness of their power.
  Finally, I come to the West. It seems that one over-riding problem confronts us in the West—one over-riding weakness. It is lack of defence in depth. For centuries this weakness has haunted the imagination of French statesmen. General De Gaulle summed up the weakness in a most vivid passage when he said:
  "A single reverse at the source of the Oise and the Louvre is within gun range. Had the Mediterranean been solid ground, instead of water, and had the French Armies, after the initial disaster, been able to retreat to Algiers, they might have been able to recover their fortunes as did the Russian Armies after the German attack."
  Unless we can assure the people of Europe that help will be speedy, they will lack the will to resist. If they feel that Europe can only be defended from the Channel and from the Pyrenees and only re-conquered after its main cities have been blasted by atomic explosions and its leading men murdered behind the barbed wire of concentration camps, resistance will not be great in the hard days when the Communists come. It is vital for us to assure Europe of quick help and of our intention to defend it on the line of the Rhine and the Elbe. I do not believe that France can maintain a defence in depth without the agreement of Germany. I know that hon. Members opposite for a time favoured a third group which would mediate between Russia and the United States of America,

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  but in that one thing would happen—Germany would certainly dominate such a group. The solution of the German problem can only be found by integrating Germany into Western Europe and allowing her an honourable living as a partner, where formerly she tried to be master.
  I submit these few conclusions: that the objective of our foreign policy is first and foremost the defence and maintenance of the democratic way of life; that in order to do this effectively we must mobilise both moral and material power—that we can offer more than the Communists, namely, liberty and nationhood to the free peoples; that the free peoples must band together to defend themselves; that Turkey must be maintained in the Middle East; that Europe be given an assurance of speedy help and reinforcement; and that in the framework of the Atlantic Treaty alone shall we solve the feud of Gaul and Teuton which has harassed Europe for a thousand years.
  6.51 p.m.
  Mr. Ian Winterbottom: As is usual and very necessary when making a maiden speech, I ask the indulgence of the House for any shortcomings of mine in matter or delivery. I do so on this occasion in a particularly heartfelt manner because I am taking the opportunity given by this Debate on Foreign Affairs to speak on Germany. In doing so I know that I am entering difficult and dangerous territory. For that reason I thought carefully before I decided to speak. I asked myself what value any comments of mine might have. I decided, because whatever is said in this House affects public opinion to a greater or lesser degree according to the calibre of the speaker, and because I consider it desirable, having some direct personal knowledge of Germany, that some warning ought to be given of the problems which will be created by Germany's political and economic resurgence.
  Germany's impact on the balance of power will shortly be positive rather than negative. She will soon pursue an active policy of her own rather than be the passive object of the policy of the Allies. The problems created by this change in the situation of Germany are of course manifold, but three of them strike me as being outstanding. The first of those problems is that of the German refugees
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  and their longing to return to their homeland. The second problem that faces us is that of uniting the 20 million Germans in the east with the 40 million in the west. Thirdly, there remains the whole problem of how Germany will feel herself once Marshall Aid has come to an end. All these may seem to be problems of German domestic policy, but according to whether or not they are successfully solved will depend the sincerity and duration of Germany's membership of any European organisation which she may enter.
  The first problem, that of the refugees, is well known to us all. There are the 11 million who were expelled at the end of the war, after Potsdam, from Poland and Czechoslovakia, of whom six and a half million arrived in the Western zones, into bomb shattered territory, on foot, carrying only such of their belongings as they could bring with them personally. Of course, these people replaced in part the casualties of the war but to this day a large section of them are either unemployed or have not yet been absorbed into the community in which they have found themselves. To this dissatisfied and unabsorbed element are added day by day the thousands of true political refugees and of young men fleeing from the press gangs of the Eastern zone. We have just recently seen the arrival at the zonal frontier of the first members of the new wave of nearly a quarter of a million expellees who are expected to come from Poland. Altogether these people are reaching the frontier at the rate of about 25,000 a month.
  The present total refugee population of Western Germany, according to the latest figures, is about nine million, which is more than the whole population of Belgium. As these refugees come into Germany they swell the large pool of unemployed which exists in Western Germany. Last year the responsibility for refugees passed into German hands, and a certain easing of the plight of these people should now be possible now that Germany can bring into effect a nation wide policy for their redistribution and the equalisation of the burdens which their maintenance puts on the State.
  That, however, is not the point I wish to make. It is my opinion that while the resettlement and re-employment of the German refugees may be capable of a

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  purely technical solution, the problem that will plague us for the next three generations will be that of the damage inflicted to German national pride by the loss of territory beyond the Oder-Neisse line and the unceasing drive of the refugees to return to what they persist in regarding as their homeland. In his inaugural address to the new Federal Parliament at Bonn, Herr Adenauer last year declared that Germany could not accept the Oder-Neisse line as its eastern border. This declaration was cheered by all the German Deputies, with the exception, of course, of the Communists.
  What to my mind is more significant still is that there are many honest hardworking men among the refugees, even those who have found a new job and adequate accommodation, who are still taking what steps they can to keep alive the hope of a return to their homeland. I know one simple East Prussian gardener who gathers his family round him every Saturday and tells his children tales of his abandoned homeland so that they will never forget the homeland from which they have been driven. The history of Europe is filled with records of the surgical shock which follows upon amputation of territory from a nation. To mention only two, I would remind the House of the cases of Alsace-Lorraine and in particular of South Schleswig, where even now, 84 years after its annexation by Prussia, and after a plebiscite in 1920 which came down definitely in Germany's favour, the matter has not been allowed to rest. Denmark has in the last few years been pressing for at least a plebiscite on the subject of the return of this province.
  If this campaigning spirit can be kept alive for so long in Denmark, it will last at least as long in Germany, where its fuel will be not only national pride but the pressing needs of the refugee population. At the moment the political activities of the refugees are still Allied controlled. When that control is lifted the results are bound to be unsettling. Poverty breeds political ferment, and while because of their personal experience the great majority of these people will probably be immune to Communism, they will be only too ready to enter any organisation which will promise to them a return to their homeland and an
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  alleviation of their lot. They will therefore, remain a danger for many decades. These refugees are and will remain a danger to the young German Republic and to the peace of Europe probably for our lifetime.
  The second main problem which I think we must discuss is the reunion of the Russian zone with the Western zones of Germany. This partition of Germany differs in nature from the separation of the Eastern territories beyond the Oder-Neisse line. Those territories, systematically emptied of their German population, are now being peopled with Polish families, but in the Russian zone no such exchange of population has taken place. The inter-zonal frontier is not a natural boundary, it is a purely artificial line on either side of which the same language is spoken and the same customs prevail; and although it is supposed by the Russians to separate two cultures, in fact it does nothing of the sort.
  On the contrary, by focusing attention on its problems it accentuates the differences between East and West. In the long run, one of these cultures must attract the other to it; and our purpose must be to secure that our culture is the stronger and that it attracts the Eastern zone to us. This it will only do if we in the West produce a society which gives its citizens a greater degree of prosperity, security and social justice; and furthermore, if we ensure that the knowledge of the existence of this better society is sufficiently widespread to overcome all propaganda to the contrary.
  If this is brought about, then I think we may almost leave it to the Germans to re-unite themselves; not by the force of arms but by the force of ideas. Herr Adenauer's recent feeler thrown out for a nation-wide election is, I think, the first sign of such a German initiative. Clearly, no such initiative would have any hope of success if the necessary political forces were absent. But these forces do in fact exist in the case of Eastern Germany for there, unlike Czechoslovakia, for instance, nothing but an artificial inter-zonal boundary divides Germans linked by friendship and by family bonds. Letters and even visits are exchanged freely, for the frontier can be crossed with ease unofficially and with fluctuating degrees of difficulty, officially.

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  In the Eastern zone and in Berlin the Germans can therefore compare the Russian picture of the West with its reality. If we in the West succeed in creating a just and prosperous economic system, we can turn the Eastern zone and the Russian sector of Berlin into a political ulcer that will infect the satellite States. It would prove untrue the Communist picture of the West and undermine belief in the system to such an extent that Russia might well be glad to permit the re-union of Germany on the best terms she can get. Such a development, however, is conditional upon our ability to create a healthy society in Western Germany. In this we have not so far succeeded. Political liberty does exist and that is something which is appreciated; but prosperity is a long way off, and social justice is conspicuous by its absence.
  The third of the great problems which face us is that of Germany's food supply when Marshall Aid ends in 1952. The food position of Western Germany is, rightly, very similar to our own. Her population is a little smaller than here, but her area, cattle population and wheat acreage are similar. But whereas we in this country have managed to reduce considerably our dependence on dollar food, this is not the case in Germany. In 1949 no less than 70 per cent. of Germany's allocation of Marshall Aid was spent on food, and on the whole her balance of trade with the dollar area is equally precarious. If our position is difficult, then Germany's position is desperate. She is indeed a pensioner at the moment, yet in the near future she must become self-supporting.
  What is more, she must earn the money wherewith to buy her food. This is where the problem arises. If Germany cannot earn the money to buy her food in the West she must turn to the East. But if she buys a material proportion of her food in the East, she at once gives hostages to fortune; since it is unlikely that she should succeed in obtaining her food from the East and yet remain immune to political pressure. Her political allegiance is bound to turn towards the group that feeds her.
  When Marshall Aid ends, Germany will very likely start a high-powered export drive in the West. I have no doubt she will be able to do this. At the
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  moment she is quite content to be nursed back to economic health by the Americans and to spend her period of convalescence in recouping her industrial machinery. But in 1952 I am certain she will come out of her corner fighting; with a powerful and efficient economic machine, with wage rates among the lowest in Europe, with extremely limited social services and with an economy free from the burden of armed forces or of the national debt. Her competition will hit this country at that critical moment at which we ourselves are hoping to be balancing our own trade with the West.
  If, at that critical juncture, we deny Germany the right to compete in the West, she will turn eastwards; and while it is right and proper that the larger proportion of her trading should take place in Eastern Europe, we cannot risk allowing her to increase her trade with the East to such an extent that it would be possible to blackmail her by a threat to her food supplies. Therefore, the hard fact is that the price of German membership of the Western society is German competition with ourselves in the West and in the dollar markets. It is essential that we should face this fact which is implicit in our effort to win Germany for the West.
  Having stated these problems, it would be wrong if I offered no constructive policy for their solution. The problems with which I have dealt are far too vast to be solved on a small and purely national scale. The problem of the 9 million refugees and expellees is in a sense an international responsibility, and unless we are willing to help relieve their misery, despair will drive these people into some form of national front, with its aggressive object of re-uniting all Germany, including the lost territories beyond the Oder-Neisse Line. In part, this problem might be alleviated by a really generous emigration policy within the Commonwealth, which might benefit both these up-rooted people and the Commonwealth countries themselves. It would certainly free Germany from the terrible claustrophobia from which she is suffering at the moment.
  Emigration, while giving some relief, cannot be more than a partial solution. It is therefore necessary that we should devise a policy which will raise the stan-

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  dard of living of the vast masses of the people who are bound to remain in Western Germany, and in all Germany. If successful this would have a dual effect. It would remove the causes of unrest which might well drive these people to revolutionary activity, and it would also lessen that element of Germany's power to compete which derives from the depressed living standard of her working people. We must, in fact, help forward the creation of a Welfare State in Western Germany. We can no longer do this by direct interference in Germany's affairs, but much can be done by friendly contacts with elements sympathetic to us, such as the German Trade Unions, the S.P.D. and others with whom we share many ideals.
  Once the feelings of resentment at our actions in the field of demilitarisation and dismantling have died down, as I think they will when the German people find that no irreparable damage has been done to their machines, then I think that the psychological moment will have come to attempt to influence German thought through all the media at our disposal in favour of the great social experiment we are carrying through in this country; and by this means sow the seeds of a divine discontent which may well alter the political climate in Western Germany. After all, the position of the Social Democrats in Germany today is not very dissimilar to that of hon. Members opposite, and neither, I believe, are without hope of a change.
  We must in principle accept competition as the price of German co-operation, but we should work where possible in co-operation with Germany in the field of foreign trade. We should try, wherever possible, to use her industrial capacity to help forward our major aims. While there must be competition in the West, I do not see any reason why everywhere there should be head-on competition. I think that it is possible for our two countries to follow parallel economic courses in a world where unsatisfied economic demands exist which we cannot ourselves fulfil at once or sufficiently fast.
  I am thinking for the moment of India and Pakistan where there is a vast unsatisfied demand for capital goods which we are supplying to a very great degree through our unrequited exports to those
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  countries. If India and Pakistan were able to obtain certain capital equipment from us more quickly by exchange, I think that would benefit us both. The recent agreement between Pakistan and Western Germany will be of great value. Hon. Members will know that by that agreement an exchange, in the main of wheat against capital equipment, is taking place.
  Further, Germany might be of great assistance in our long-term project for opening up Africa. The rate of development of that country depends upon communications, and Germany has very considerable resources of unused steel capacity and manpower which might help us in this aim. If we could develop Africa fairly quickly we might be able—also fairly quickly—to fill the European larder. Germany's co-operation should be sought to this end.
  Lastly, I naturally hope to see an end to German isolation by her absorption into the various administrative and political organisations which are being created in Western Europe. As has been said on both sides of the House, this is obviously essential. I do not think that the mere presence of Germany within a Western European organisation is any guarantee of her co-operation with the West unless she is politically and economically healthy. Germany has entered the Ruhr Authority, for instance, with the obvious expectation that it will have an important part to play in the integration of Western Europe. The appointment of her Vice-Chancellor, Herr Blucher, and a responsible trade union deputy, indicates the interest which Germany feels in this organisation. I should like to see this body become a truly international force capable of integrating the capacity and output of the coal and steel industries of its member States.
  I believe, with so many people in this House, that Germany must be brought into the Council of Europe as soon as possible. I hope that the Committee of Foreign Ministers, when it meets in the near future, will find means to overcome any of Germany's inhibitions which arises from the French policy in the Saar. I hope that this House will excuse me if I have dealt with one country only,

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  when the whole world is open for consideration. I have done this, because I consider that Germany's industrial power and strategic position are of such importance that, unless we succeed in winning her unconditional support of our cause, we shall lose the political struggle in the West.
  7.15 p.m.
  Mr. Boothby: I have sat in this House now for 26 years, and I have never heard such a wonderful crop of maiden speeches in any Parliament as we have had in this one. They have been fearfully good, putting us old boys to shame. If I say to the hon. Member for Nottingham, Central (Mr. Ian Winterbottom) that he has worthily maintained the standard, I can pay him no higher praise. He spoke with great authority and assurance upon a subject of vital importance. He interested us all, and I know that we shall be very keen to hear him again at the earliest possible opportunity. I should like to congratulate him most sincerely.
  I do not want to strike a depressing note in this Debate; but I must say that I found myself in complete agreement—or rather in substantial agreement—with my hon. Friend the Member for Preston, North (Mr. Amery) who said, in his admirable maiden speech, that we are in fact now fighting the third world war. I think that we are in the middle of it. It is a war which, although not hot, is total. Our problem is, therefore, not so much one of preventing war as one of making peace. What we have to do is to try to bring this war to an end
  There is no longer any doubt about the present object of Soviet policy. It is, to be quite brief and pointed, the conquest of the world. As a matter of fact, there has not been any doubt about it since 1945, except for those who have not wanted to believe it and have, therefore, refused to believe it. It has been constantly reiterated in theory and furthered in practice. For those who had any lingering doubts or hopes, the policy, and the theory on which it is based, was announced to the world in three comprehensive speeches of profound and far-reaching importance in the autumn of 1947—in the speech of Vyshinsky at U.N.O. on 18th September; in the speech
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  of Zhdanov to the conference of the Cominform in the same month; and in the speech of Molotov on 6th November at the anniversary of the Revoloution. Their proclaimed objective was the seizure of monopolistic power by the Communists, over as wide an area and as rapidly as possible; and the establishment of Communist régimes on "the only and best pattern"—to use their own phrase—that of the Soviet Union. Therefore, Tito is out.
  The method is now familiar to us. It is the method of the Trojan horse. And it has, in practice, been enormously successful. I think that we should face up to that. I want to give one very short quotation to the House from a book by Mr. James Burnham, who himself had rather close associations with the Communists at one period in the past and therefore knows a good deal about them. The quotation is this:
  "On the basis of the full evidence, Communism may be summarily defined as a worldwide conspiratorial movement for the conquest of a monopoly of power in the era of capitalist decline. Politically it is based upon terror and mass deception; economically it is, or at least tends to be, collectivist; socially it is totalitarian."
  On balance, we have been losing this cold war for the last five years. I think the main reason for this is that we have, to a very great extent, misconceived its character. We have been, genuinely and inevitably, concerned about this atom bomb, under whose shadow we live; but I think our preoccupation with atomic bombs and hydrogen bombs has given us a rather false sense of perspective. This struggle for world power, in which we are inextricably involved, may well be a very long-term business indeed. Violence has been used, is being used, and will be used; but I think it highly problematical that atomic violence will ever be used. I agree completely with the right hon. Gentleman the Leader of the Opposition when he said that the existence of the atomic bomb is in fact a great deterrent to total hot war. I believe that to be profoundly true. Also, we must remember that the Soviets believe that time is on their side, I think, and hope, that they may be wrong; but they think it. They await with some confidence the collapse of the Western world. In the meantime they will continue the struggle by the methods that have already proved so successful.

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  I now want to examine for a few moments what I believe to be the causes of our failure, the causes of our losing this struggle, by and large, over the last five years. Here again, I find myself in agreement with my hon. Friend the Member for Preston, North. I think one of the main causes is that we have not been fighting. I really do believe that in this very rought world one has got to fight to live. If Benes had fought in 1938 or 1948, Czechoslovakia would not have been subjugated, first by Hitler and then by Stalin; and would be a free democracy today. He did not fight on either occasion.
  We ourselves have only stood up to the Communists twice since the war—in Greece and in Berlin—and on both occasions we have beaten them at their own game. This is an interesting point, and I think it has a bearing on the morale of those who are today manning the outposts of Western democracy. We have a lot of chaps, some of them in the Services and some in the Civil Service, around the periphery of Western Europe and all over the place; and they are subjected to a barrage of propaganda and to pressures of every sort and kind. I do not think they get enough support from us. I do not think there is enough blast from the other side. I do not think they are given the confidence which they should be made to feel from the knowledge that not only are we just as strong as the Communists, but we are infinitely better in every kind of way. I think we have allowed too much to go by default. We ought to launch a propaganda offensive; we have been far too much on the defensive in these last years all over the world.
  Secondly, I think our faith is still not strong enough. Our opponents are dedicated men. Their leaders understand what is at stake; and all their energies, resources and determination are fixed upon their goal, which is a monopoly of power. To this end all else is subordinated—the individual, law, freedom, ethics, the family, art, literature, science and religion. All. Within such a framework, and against this background, democracy, as we understand it in the West, becomes completely meaningless. As the Leader of the Opposition said, the gulf yawns between us. The Communists believe that ends justify any
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  means; and we believe, if we believe anything, that no ideal end justifies absolute power over the lives of individual human beings, or the infliction of one iota of avoidable suffering on human beings.
  Until we achieve a decisive victory in this struggle for world power, I confess that I see little point in coming to formal agreements with these people, unless we are clear in our own minds that they will keep them only as long as it suits them to do so. In that respect they are not at present markedly dissimilar from Hitler. The much-abused Protocol of Yalta asserted the rights of all peoples to choose the form of government under which they would live. That was accepted by the Soviet Government; and, if they had honoured their pledge, either in the letter or the spirit, Roumania, Bulgaria, Hungary, Poland, Czechoslovakia and Eastern Germany would not today be enslaved. I believe that the most decisive victory that we could win would be the achievement of a democratic Western Union of such strength that no potential aggressor would dare to attack it; and I think it can be done. I think we can only win this struggle by faith and works. It may take us five years; it may take a generation, or even longer. We have all got to brace ourselves for a long ordeal of cold, but total, war before we can make peace; and we must win that victory before we can have that peace.
  On the subject of faith, I will only say that no creed which can effectively counter the Communist ideology can be based on the rational materialism of the 19th century, because that is the base from which Marxism itself stems. We must go deeper. I think that Koestler got to the root of the matter when he said that there is a whole realm which starts where logic ends; and that unaided reason is a defective compass which leads us on such a winding course that we end by losing the vision of our goal.
  The subject of works brings me to the third cause of our failure. For five long years we have had no comprehensive foreign policy. In Soviet policy, nothing is unrelated; in Western policy, nothing nothing has been related for the past five years. It is all piecemeal. The relationship between the British Commonwealth and the United States remains undefined

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  and nebulous; and we spend much of our time in hot argument with each other. We are half in Europe, and half out. Germany is half in Western Union, and half out. Our defence commitments are vast, but vague; and our resources totally unknown, at any rate to Members of this House.
  Where is our eastern frontier? Can anybody tell us? Sometimes, in the night watches, I hope that the Ministers who are responsible for our defence know the answer; and sometimes I wonder if even they know. Defence policy must be based on foreign policy, and foreign policy demands a theme. Where is our theme? I cannot find it. For five years we have lurched from one political crisis to another, and have lost half Europe and the whole of China in the process. How the Kremlin must rejoice in our uncertainties and indecisions, our divisions and futilities! It is just what the prophet Marx foretold; and, from their point of view just what the doctor ordered.
  When, at last, a man of commanding ability appears on the scene of endeavours to formulate a constructive policy for the western world which is designed to save the sum of things before it is too late, an attempt is made to hound him out of public life. What is going on in Washington today is a horrifying spectacle; and somebody should say it, because we are not an unimportant part of the western world, and we are entitled, at least if we are back benchers to comment upon these lamentable events. What is Mr. Acheson's policy? It is a policy of total diplomacy to meet the requirements of total cold war—unity, strength and a stable and dynamic economic order for the western democratic world. Is it for this that he is to be driven from office? It is the only thing that can save the world from total hot war, and perhaps bring the cold war to an end.
  I hope the right hon. Gentleman the Foreign Secretary, when he comes to speak this evening, is not going to take us on one of his melancholy perambulations round the world, which we have had on so many past occasions. They are not only rather boring, but also terribly depressing. The story he tells with such pathetic confidence is only too often a story of unrelieved failure. Even the right hon. Gentleman himself cannot be very pleased with what is going on in the
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  Far East at present; and, as for the Middle East, I think it is really kinder to draw a veil, because our prestige there is somewhere in the neighbourhood of zero. In Germany, about which country the hon. Gentleman opposite made such an interesting speech, the rumbling of his detonations constitutes a sinister obligato to the rumbling of his speeches. I am not going to ask him to allow Germany to re-arm at this stage. I have a much milder request to make. It is that, as a first step, he should stop blowing up their factories and shipyards. That, I think, would be very helpful. It does not achieve any useful purpose; and, with a maladroitness that is almost inconceivable, he has contrived to saddle this country with the sole responsibility. I do not know how he managed it, but he has managed it.
  This brings me to my last point—the issue of Western Union. I say quite frankly that I would like to see a Pact of European Union; and the creation of a European Political Authority with limited competence but defined powers. If such a union is to have any reality, it must include both Great Britain and Germany. There is no doubt about that. Then, of course, if the thing works, the defence problem will solve itself. If it does not, nothing will be solved.
  We have a considerable responsibility in this matter, because for 300 years we have fought to prevent the unification of the Continent of Europe by force. I am one of those who think we were right to stop it; but it imposes upon us a certain obligation not to prevent the unification of Europe in time of peace by consent; and a great many people think we are busy doing that at the present moment. Not a single European country, including this country, is a viable political or economic unit in the modern world. The net of isolating nationalism, with its welter of frontiers, barriers, tariffs, quotas, currencies, passports, restrictions and bureaucracies must be broken. Otherwise, we shall first of all stifle, and Western Europe will ultimately be absorbed into the suffocating totalitarian unity of the Communist Empire. That is really the issue that confronts us
  What is the cause of the hold-up, because there is one at the present time? The high hopes engendered at Strasbourg

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  have not been realised; the thing is somehow sticking. Why? Quite frankly, I do not think it is just the intransigence of the right hon. Gentleman and the Foreign Office, although a lot of people on the Continent think so, and hold this Government to be mainly responsible. I think it is really to be found in the continuing disagreement between ourselves and the United States of America about the future economic organisation of the western world. It is a kind of hangover from the first American Loan and the Bretton Woods Agreement.
  Any serious attempt at European economic integration—and here I agree with my colleague in the Council of Europe, the hon. Member for Coventry, North (Mr. Edelman) who spoke recently—presupposes some kind of currency clearing system, some co-ordination of monetary policies, reciprocal trade and payment agreements on a limited multilateral basis, and the development of the basic industries by means of planned international investment. We all concur in that view. I do not think it involves any hold-up of the liberalisation of trade, which can go on at the same time; but it is the antithesis not only of the kind of planned national Socialism which we have been having from the present Government, but also of what may be called laissez-faire. It requires an extension of the sterling area and of the preferential system; in one word, discrimination. This was clearly recognised by the Assembly of the Council of Europe at Strasbourg last summer.
  We must face up to the fact that, until quite recently, the main objective of American economic policy has been to break up the sterling area; and to revert to a system of free multilateral trade, based on the free convertibility of currencies, non-discrimination, and a fixed parity between the pound sterling, the dollar, and gold. That has been the ideal. They have already begun to see the light, and are gradually giving it up; but the ideal still swings along at any rate in the State Department and in the Treasury. It is under American pressure that we have signed these agreements at Geneva, Annecy and Havana and have chiselled our system of Imperial Preference; and an extension of narrow bilateral agreements has been the inevitable result.
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  The time has come to tell the Americans quite frankly that we are not prepared either to sabotage the sterling area, or to return to the international economic anarchy which prevailed in the 19th century, and for a number of years between the two wars. The conditions which supported that system no longer exist. I am old enough to remember the days prior to 1931 when international trade became a ruthless pursuit of gold, when the main object of each separate country was to export its own unemployment to others, and when every ton of coal cut in Europe—in Germany, in Poland, in Belgium, and in this country—was subsequently sold at below production cost, although the wages of the miners throughout Europe were almost at starvation level.
  Mr. Ivor Owen Thomas: If the hon. Gentleman will allow me—
  Mr. Boothby: I am sorry I cannot give way to the hon. Gentleman, but I am just finishing.
  Is that what we want to go back to? If so, it would be the end of Western Union, and of western civilisation. It is precisely what the Communists are praying for, and banking on. They know that there cannot be economic warfare and political friendship; and that if the Western World is now going back to cutthroat international competition, based on free non-discriminatory multilateral trade, the Western World will fall asunder.
  The answer to the problem is to be found neither in a return to a policy of laissez-faire nor in a continuation of planned national Socialism. It is to be found in constructive co-operation and compromise. To quote from the Principles of European Policy put forward by the European Movement:
  "It is not a question of choosing between liberty and authority, nor between a free and a collective economy, but of creating a synthesis of the two, which, far from being in opposition to one another, can be combined for constructive purposes."
  Here, in my opinion, is the real and immediate challenge to Western democracy. It must be met, first, by the British Commonwealth of Nations and the United States of America, without whose effective co-operation both in the political and in the economic sphere nothing can be achieved.
  7.37 p.m.
  Mr. F. Elwyn Jones: If hon. Members who sat in this House in 1944 and 1945 had been told that five years later the right hon. Gentleman the Leader of the Opposition would be advocating the rearming of Germans, they would not have believed it, but this remarkable political somersault has been achieved in the narrow space of five years, and it is important that we should consider this remarkable victory for Germany, which is not the only victory she has achieved since she lost the war. The hon. Member for Aberdeenshire, East (Mr. Boothby), did not follow his right hon. Friend in this new development in Conservative foreign policy, but the reiteration of the views of the Leader of the Opposition on German rearmament by a number of hon. Members opposite, must now be taken by those of us on this side of the House to constitute official Conservative policy.
  Mr. Boothby: The hon. Gentleman will not win any votes that way.
  Mr. Jones: Let us see what it is going to lead to and let us try to consider these grave matters, not in the air of the hustings, but in the air of a more responsible place. The achievement of Germany since the war has not been confined to this conversion of the Leader of the Opposition to the re-militarisation of Germany. The first outstanding victory of Germany was the abandonment by the Allies of their programme of reparations. The amount of reparations which we have acquired from Germany has been infinitesimal in comparison with the damage inflicted by Germany and with the industrial wealth that was stolen by Germany from the countries she overran.
  In addition to the abandonment of reparations, there has also been the substantial abandonment of dismantling, and I am astonished that the hon. Member for Aberdeenshire, East, saw fit once more to raise that issue in this Debate. At Bonn, in November of last year, there was an agreement for the substantial ending of dismantling. The German authorities then agreed that certain industrial establishments, including part of the vast Hermann Goering factories and a few other installations whose sole object was
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  the re-creation of German military might should be demolished, and there are few demolitions still to be carried out. But, substantially, the Governments of this country, of the United States and of France have abandoned the policy of demolitions.
  It is important to emphasise this, and I think much harm is now being done by hon. and right hon. Members opposite by their propagation of the idea of re-militarising Germany. For it was agreed by the German authorities at Bonn that the abandonment of demolition was conditional upon a declaration by the Bonn Government of its
  "earnest determination to maintain the demilitarisation of Western Germany, and to endeavour by all means in its power to prevent the re-creation of armed forces of any kind."
  That was the basis of allied abandonment of dismantling and that very basis is now being cut away by our own countrymen, sitting on the other side of the House. I find it a most remarkable situation. I understand the right hon. Member for Woodford (Mr. Churchill) prefers this policy to be put as re-arming Germans rather than as the re-armament of Germany, though I confess I cannot understand the difference.
  It is only right to say that this pressure for the re-armament of Germans comes at the moment in the main not from Germans, curiously enough, but from outside Germany. When I was in Germany—and I have been there a good deal since the war—I found on the part of most Germans to whom I spoke, a great unwillingness to re-arm and a considerable resistance against forming new German armed forces. So far as the Germans in Western Germany are concerned, they have no passionate desire once more to engage upon war with Soviet Russia. They had four years of it, and they did not like it very much. Nor do I think there is any great desire on the part of Eastern Germans to rush into war once more, for or against the West, or for or against the Soviet Union.
  Our real allies within Germany, the German trade union movement and the Social Democratic movement, do not favour the re-arming of Germany. Those are the allies of the Western democracies, not the faded field-marshals, who are lurking in the shadows waiting once more to come back to power and influence. These trade unionists and

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  Social Democrats of Germany know very well the dangers that the reconstitution of German military forces would bring forth. The Social Democratic movement in Germany remembers very well the events that followed the 1914–18 war. Hon. Members will remember the formation in those days of the Reichswehr of 100,000 men. The democratic Government of Germany completely failed to democratise that limited force of 100,000. Most responsible German democrats today are opposed to this pressure, principally from outside, and principally from right-wing elements outside Germany, to recreate German military power. It is having the effect of encouraging the very forces within Germany who are a challenge and a continuing menace to all we understand by Western democracy.
  However, it is argued that, as the Russians are re-arming Eastern Germany, we ought to re-arm the West, so that if it came to a show-down the East Germans and the West Germans would fight each other and we could look on happily. In my experience in Germany I have seen very little evidence of a desire on the part of Germans to fight a civil war, either on behalf of Western democracy or on behalf of Soviet Communism. We have the statements of General Halder, who was chief of the German General Staff, of Pastor Niemoeller and of President Heuss, President of Western Germany, all representatives of different trends of thought in Germany, that in no circumstances would Germans wage civil war upon each other. There is, indeed, little in the experience of Germany, within our memory at any rate, to point to their willingness to engage upon a civil war to the benefit of anyone outside their own frontiers.
  Indeed, it is much more likely that they would use their re-arming to exploit to their own advantage the differences that exist between East and West. I have seen little evidence to indicate that the officer class of Germany are now willing to dedicate themselves to the service of Western democracy. If a German military force is strong it will be politically dangerous. If it is weak it will be militarily useless and a political embarrassment. I think it is this dilemma which accounts for the extreme vagueness of the suggestions of the Leader of the
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  Opposition as to what form the proposed German force is to take. There is a strange kind of wishful thinking in the mind of the Leader of the Opposition about this German force. It is to be strong enough to frighten the Russians, but not strong enough to alarm the French. Such a military force has not existed and never will exist.
  If we look at the matter from a military point of view it seems to me that very little could be gained through the creation of a few German divisions, be they merged in a Western European force or not. The immediate problem for the defence of Western Europe is surely not the manpower problem. What is lacking in Western countries, like France and Italy, is not men, but arms and equipment. Even more important, there is lacking an economic basis strong enough to support a military establishment. Surely, it would increase rather than lessen these deficiencies in the West if we were to assume also the burden of equipping and maintaining German troops. Every gun we would press into the hands of a willing German infantry man would be a gun lost to the French, Italians and other members of the Western democracies. I fear it would be a gun which, in a crisis, might still be pointed against us rather than with us.
  Therefore, I sincerely hope the Government will set its face firmly against this pressure from the Opposition for the rearming of Germans. It would have a most disastrous affect upon our influence and standing in Europe. It would not be understood by the French; it would arouse their alarm. It would arouse hate against the Western democracies along the whole periphery of the Soviet Union, among the peoples of the Baltic, Poland, the Ukraine, Czechoslovakia, and Yugoslavia. All those countries do not approach this German problem as an interesting academic study. They see German military might through the boundary wire of a concentration camp.
  The hon. Member for Cambridge (Mr. Hamilton Kerr) spoke about Russian armies advancing on Europe with security police wagons in the background, but the peoples of Europe associate the German armed forces with the gas wagon following up behind. Their memories are bitter. It is unfortunate, perhaps, that

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  the bitterness continues, but the fact is that it exists. Really this haste to rearm Germany is indecent. Let us bide our time. Our true friends in Germany do not want it. I hope this pressure will be firmly resisted by my right hon. Friend from whatever source it may come.
  7.51 p.m.
  Mr. Nigel Davies: In craving the indulgence of the House on rising to address it for the first time I would ask hon. Members to forgive any errors or failings of which I may be guilty. I intervene with special diffidence in such a broad field as foreign affairs. I want to speak on matters that affect Eastern as well as Western Europe and I am bound to say that I do not see that anything we do in Europe will be of any avail unless we can stop the rot in the Far East. It is reasonable to say that if the successes of democracy in Europe were as striking as those of Communism have been in the Far East of late, then in Europe we should have nothing to worry about.
  In spite of a stay of some 18 months behind the Iron Curtain, I think there is little that I could tell of the sufferings of the people of Eastern Europe and of their leaders and clergy that has not already been made known. I speak particularly of Roumania, Hungary and Bulgaria. First-hand experience heightens appreciation of the pathetic and desperate longing in those countries for contact with the Western World, however slight. It heightens appreciation of the deep discouragement created by any display of weakness among the free nations.
  In considering our policy towards these Iron Curtain countries we would appear to have two alternatives. We can either regard them in terms of the old diplomacy, as countries coming within a sphere of influence that is not our own, as pawns and counters in the "cold war "; or we can regard them as nations that are an inherent part of the Continent of Europe and whose spirit we must at all costs seek to keep alive even if we cannot now restore their freedom.
  I suggest that we cannot adopt the former course with a clear conscience. Russian domination may be a fact, but it would be a denial of all that we fought for if we ever gave formal or even implicit acknowledgment of that fact in any settlement that the Western World would seek to make with Soviet Russia. Indeed,
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  any settlement which acknowledged that fact would be worthless in that it would contain an admission that the Agreement of Yalta had been completely and successfully violated.
  Surely it must always be our policy to seek to help and encourage by every means those down-trodden peoples and to preserve at least their national identity as they did during centuries of Turkish domination. I exclude, of course, the Czechs and Poles with their different masters. They will need every encouragement if they are to preserve their identity against this much more systematic attempt at permanent domination. Hon. Members might say, "What can we do about it?" Even such things as libraries and information centres of Britain and other countries are now banned; all contact is denied with these countries, save one alone, and that is the radio, which is therefore of absolutely paramount importance. Surely every penny spent—and it is not very much in relation to our defence expenditure—on broadcasting to these countries, particularly to the countries of Eastern Europe, must be very worth while.
  I listened recently to Roumanian and Bulgarian broadcasts of the B.B.C., and I would readily acknowledge that efforts have been made to improve the service. But the scale of this whole campaign is still very small indeed when we remember that it is the only link between the free world and the nations behind the Iron Curtain. I hope that further efforts on a big scale will be made to extend the scope, quality and strength, and particularly the strength of transmission, of these broadcasts in view of the heavy jamming which they have to encounter. Surely we can regard them as a real offensive weapon in the "cold war." It is a task that demands the utmost imagination. Could not the Czechs who have just come out of Czechoslovakia by airliner have been put on the air to tell what fears and horrors beset them and made them leave their country? Instead of that, Czech listeners to the B.B.C. a few days ago heard a detailed account of an ice hockey match.
  We must remember that people have to run a real risk to listen to these broadcasts, and they do listen. What they want to hear are facts about what is going on in the world and also what is going on in

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  their own countries, because that is entirely denied them through the medium of their own Press. There are many things going on in their own countries which are in no way publicised in those countries. What they need is factual information, and not, for instance, an account of the Oxford and Cambridge boat race.
  Turning to another point in this problem, I do not think it would be wise to withdraw our diplomatic representatives from Eastern European countries, however much they may be insulted or frustrated, because looking at it from the point of view of the people in those countries, the presence of these diplomatic representatives is at least a minor encouragement and a minor contact; this is also true from our point of view, too. People are cheered to see Western diplomats even if they dare not talk to them.
  On the other hand, any softness to the governments of Iron Curtain countries will do us nothing but harm in the eyes of their peoples on whom they have been imposed. I would go so far as to say that even in our straitened circumstances of today it should be a matter of principle as well as of sound policy that we should not enter into trade agreements with governments that persecute our business men and insult our diplomatic representatives. I am glad that that principle has been put into effect in the case of Hungary. Surely, we shall gain nothing in respect in any part of the world if we accord their diplomats here any privilege or courtesy that is not accorded to ourselves in their countries.
  I wish to mention one other important aspect of the problem. If we are to ask these people to resist in their own minds and wills, if not physically, the pressure which is being put upon them, we must see that the West offers a constructive alternative—not merely a return after an interval, however long, to their pre-war status, but admission to a united European community embodying not only political freedom but also economic prosperity, with perhaps even a minimum standard of social services such as the Balkan people did not enjoy before the war. We must recognise that Communism, however detestable, is bound to have an attraction in the long run unless our free system can offer hope of a fuller
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  life to the citizens of those countries than that which they enjoyed before the war.
  I am aware that the subject of European unity has been debated considerably today and was also debated at length in the last Parliament, but the impression persists throughout the world, as my right hon. Friend the Leader of the Opposition emphasised, that Great Britain is holding back and is hesitant. I have found it impossible to escape from such an impression in France and in Italy and it is unavoidable anywhere in the United States of America. Surely this feeling could not be so universal unless it had some basis. We all acknowledge the part which the Foreign Secretary has played in the initial stages both of Western Union and of the broader conception of a United Europe, but if we do not continue to lead, then either Europe will not unite at all or, worse still, she will unite without us.
  Might I, in all deference, suggest that it can be a task of this Parliament, with its even political allegiance, that to co-operate with all Western European Governments without prejudice and whatever their political structure and thereby seek to remove the impression which exists throughout Europe and the world that we are holding back because of any doubt or hesitancy. The Minister of State emphasised that our experts were second to none in their anxiety to forward Western European unity. I hope he will also show that our Ministers are second to none in their eagerness to further this great cause. In particular, I hope that a reasonably generous view, as generous as possible, will be taken by the Government of the project for a European Payments Union and that we shall do all in our power to advance in every practical, way the transferability of European currencies with the maximum practicable sterling participation.
  It is most necessary that we should now attain greater economic integration, particularly in view of the way the question of competition has arisen this afternoon. It seems particularly important that we should integrate on the question of steel with France, Germany and Belgium at a time when we are threatened not only with immense competition but probably, before long, with over-production. Surely further steps should now also be taken towards military integration in preparations, organisations and especially com-

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  mand, not only among the five countries of Western Union but among all the Western European countries. This question is coming to the fore in connection with German defence, which makes it particularly vital.
  Lastly, if the year 1950 can be made to mark the resumption of the full leadership by Great Britain in Europe, to mark the formation of a European Payments Union with sterling participation, and to mark even perhaps the beginning of this suggested Franco-German Union, it will be a year which will have given strength to the West and some hope to the East of our divided Continent.
  8.6 p.m.
  Mr. Crossman: It falls to my lot to congratulate the hon. Member for Epping (Mr. Nigel Davies) on his excellent maiden speech. I particularly liked his reference to the listening habits of those who live in danger of their lives behind the Iron Curtain, and I was very glad to notice that he had already learned that the taste of the House of Commons in speeches is the same as the taste of listeners behind the Iron Curtain; they like factual speeches, speeches by people who know what they are talking about and who keep to their own subjects. In that way tastes are universal. We shall hope to hear the hon. Member often in the future.
  I want to turn back from the speech of the hon. Member for Epping to that of the hon. Member for Aberdeenshire, East (Mr. Boothby). I have noticed in one or two speeches by hon. Members opposite a note of combined frustration and hysteria. Indeed, in one maiden speech—a very able speech—we had the solemn proposal that we should organise guerilla warfare throughout Eastern Europe. The hon. Member was apparently not aware that, after all, it is not much good organising guerillas unless one is prepared to go to their assistance with active military aid.
  Then we had from the hon. Member for Aberdeenshire, East the extraordinary sentence that we could not begin to understand the mistakes of this side of the House until we realised that we had already begun fighting a third world war. This sort of melodramatic nonsense is very misleading. If we had already begun fighting the third world war then, as the right hon. Gentleman the Leader of the
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  Opposition has already pointed out, it would mean that the Russians had swept through Western Europe and were on the Channel coast.
  Let us not use melodramatic phrases. Indeed, the whole problem which faces us today is that the Russians conduct their peaceful diplomacy as though they were at war when we are actually not at war. That places the democracies in a terrible dilemma because a "phoney" war always finds the democracies at their worst and the totalitarians at their best. We have to face the fact that we would rather have this "phoney" war than have the "hot" war which is the only alternative, and we have to find a way, therefore, of doing better in this "phoney" war than we did in the "phoney" war of 1939.
  I agree to some extent with hon. Members opposite that we have not been doing very well in this "phoney" war, but I am surprised that they should make this criticism after having heard the speech of the Leader of the Opposition who, throughout his speech, asserted that the whole policy on which we have been operating for the last four years was his invention. He said he invented it at Fulton. Thus, when we hear from hon. Members opposite—and I took down two quotations in particular—that during the last five years we have lost half Europe and also China, it is as well to remember that half Europe was lost in 1943 and 1944 as a result of the Teheran and Yalta Conferences in which Members of the Opposition played a leading part. What is the good of having this sort of thing thrown across the Floor of the House?
  We agree that things have not been going very well under the Fulton policy. Under the policy of the round-the-world, global containment of Communism we have had some serious defeats. It is worth noticing that we have done very well in Europe, despite the disastrous situation created by Yalta. Since then we have done not too badly in resisting the offensive. The disasters have come outside Europe. Why is that? I should like to suggest an explanation to the House. In the case of Europe, Communism can be identified with Russian imperialism. There is not a single country of Europe today which would have a Stalinite Government if it were not for the presence or the proximity of the Red

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  Army. There is not one single Government in Eastern Europe which would not be overthrown by a popular uprising if the Russians were not near by to prevent it. The proof of the pudding is, of course, Marshal Tito in the one country with an indigenous Communist movement. He has challenged Stalinism because he was refused Dominion status in the Soviet Commonwealth of Nations. The rest of the Communist Governments in Eastern Europe are literally satellites of the Russians.
  I suggest to the House that it is a very dangerous conclusion for us to draw that, because in Europe Communism is virtually identical with the expansion of Russia imperialism, the same is also true in the Far East. It is fantastic to hear speeches from the other side of the House suggesting that the Communist victory in China of Mao Tse-tung and of He Chi-Minh in Indo-China have anything to do with the Red Army. They are, of course, of great advantage to the Russians, but those Communist movements in the Far East are vast, indigenous movements of millions of people with very little connection with Moscow, except that they are led by a few well-trained men who have been to Moscow and gone back and applied in their own countries the lessons that they have learned there. It would be a most dangerous mistake to suppose that these movements deny those countries self-determination. The trouble is that in Asia there is self-determination on the side of the Communist idea.
  Major Tufton Beamish: Has the hon. Gentleman ever heard of the Far Eastern section of the Cominform?
  Mr. Crossman: Yes, I have.
  Major Beamish: Will he tell us about it?
  Mr. Crossman: I have heard of it. I would suggest that anybody who thinks that the Communists' success in China is merely a piece of Russian expansion, under-estimates the danger in China today. Communism there is quite different from the Communism in Poland, or the Communism in Hungary, or the Communism anywhere in Europe. Here is something deeply popular. Here is a revolt of millions of coloured peoples against white ascendancy.
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  So I would suggest to the House that, if our policy in the Far East is to "contain" Communism, then we are simply deciding to do the impossible—to resist one of the great social revolutions of history. Europe which used to dominate the world is now merely just one part of the world, and the peoples in Africa and Asia are asserting the right of nationhood, and they have grasped Communism as the means of asserting it. Primarily Communism there means something to fill empty bellies and something to achieve self-determination. It is against white imperialism which has lasted 100 years, that they are now rising. So I suggest, when hon. Gentlemen opposite say that it is a perfectly simple thing we have to do, and that is to fight Communism, that it may be wiser to realise that the only chance we have of defeating the Russians is to split Communism—to split the Communists who believe in their own nationhood from the Communists who are merely satellites and serfs of the Russians.
  What has happened in Yugoslavia may happen elsewhere in the world, if we split Communism, and if we enable the millions to feel that we are not against any and every form of social revolution, but that what we are against is the annexation by the Russians of any social revolution, the use by the Russians of any social revolution, and the perversion by the Russians of every social revolution for Russian imperialistic ends. We must show those peoples that if they will come along with us they will be allowed to go forward, allowed to have their social revolutions. That, at least, would be a foreign policy which would have some chance of driving the Russians back to their frontiers without a war.
  It is for that reason that I wholly approve of the Government's determination to recognise the Communist Government in China, despite the opposition from the other side of the House. It is a decision which, in the long run, will help to make it possible for the Chinese Communists to remain Chinese and to fight the battle against the G.P.U. agents inside their party.
  I want now to turn to the problems of Western Union and to raise an issue which has not been examined so far, and the omission of which in this Debate I find confusing. People talk about

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  "United Europe" and talk "Germany." Do they mean the whole of Germany or Western Germany? Do they mean the whole of Europe or the truncated portion of Europe which happens to be on our side of the Iron Curtain. It is well worth remembering that the ideological division of Europe is the result of the accident of where the armies of the East and West happened to be when the war ended. Western Europe is where the Anglo-American Armies got to, and Eastern Europe is where the Red Army got to, all in the quest of "liberation." It is the most artificial division in the world, and before we make up our minds that the aim and object of our policy is to consolidate existing Western Europe we must consider whether it is a workable union.
  Is it really possible to consolidate Western Europe with Western Germany inside it, leaving Eastern Germany and Eastern Europe to the Russians? It will be impossible as long as Germany is divided. The Germans' whole policy will be to unite Eastern and Western Germany, and then get back Breslau and then get back Konigsberg and then think, "I am now big enough to start the war for world domination again." While Germany is artificially divided it is nonsense to talk about a united Europe.
  There is also the question of the economic integration of Germany into Western Union. In the West there is an increased population of 10 million. Unless Western Germany can in some way trade eastwards Western Germany is going to capture British market after British market. Already Western Germany is competing with us in the world markets. There are only a limited number of markets in the Western World, and in Western Germany there are 65 million people desperately short of land and desperately short of markets, and yet we have told them that the one thing they must not do is to trade with the Eastern zone which, with Eastern Europe, is the only place their trade can flow without competing with our own.
  We should consider these two problems before we say it is absolutely certain that the unity of the Western half of Europe is the be all and end all of our policy. To my mind Western Union is a completely unworkable unit in the long run. It is a makeshift unit, and we have to make the best of it for now, but do not
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  let us give up the long-term policy of a really united Europe.
  This brings me to the question of the arming of Germany. The Leader of the Opposition said that I had misquoted him. If he will look at the OFFICIAL REPORT he will see I quoted him precisely. Having quoted him, I said what he really meant, and I may, in his view, have mis-paraphrased him. However, let us take up what he said today. He said that he did not mean re-arm the Germans but that what he meant was, let the Germans be soldiers along with us in Western Europe. What does that mean? Soldiers? I suppose it means armies and divisions, and I suppose divisions imply quantities of arms.
  Can it be that the right hon. Gentleman is so simple-minded that he thinks that Germans will accept a situation in which they are provided with arms by somebody else, and treated as second class European citizens? Is he not aware that the Germans are very sensitive on the subject of second class citizenship? They certainly will not fight our battles as mercenaries. They will probably fall back on the very proper argument that, as first-rate soldiers, they are probably better than all the rest of us put together, and I have no doubt that they will despise such a situation as five German divisions equipped by the Americans and British, and under the command of British, French, Belgium, and Dutch staff officers. If anyone in this House seriously tells them that that is an idea that would satisfy German honour they must have a distorted notion of what is German honour. German honour will say that if there is to be a French detachment and a British detachment there shall also be a German detachment on completely equal terms—or nothing at all.
  So there will be discord about German rearmament and we shall see as the negotiations proceed, the division of the Western Powers becoming more and more deep if the right hon. Gentleman continues to assert the necessity of rearming the Germans. I would put one thing to this House on this subject: I was struck by the speech of the hon. Member for Preston, North (Mr. Amery). I think that he was right and that we have to recognise that Russia has far exceeded her sociological frontiers. In capturing Poland, which is essentially

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  Western, she has gone far beyond her natural frontiers, and if we are ever to have a united Europe the Slav countries must come back to our European civilisation. I agree. But does he think that the Slavs, the Poles, etc., will ever come back to Western Europe that has re-armed Germany? Can he think of any more effective way of driving into the arms of Russia every Pole, every Czech, and every Yugoslav?
  I was in Prague in February a few days after the revolution. The one thing that gave the Communists their power in Prague to put over the revolution there was the propaganda about Western democracy's determination to re-arm the Germans. Let us be quite clear that if we re-arm the Germans we are consolidating the Russian control of Eastern Europe because the patriots in Eastern Europe will fight the Germans every time, even if it means siding with Russia.
  I put forward one other consideration to the House on this subject which has not yet been mentioned. In my view the major deterrent militarily to the Russians today is the presence of the American troops in Germany. For these American troops in Germany mean that if the Russians ever did move into the West they would immediately make contact with American forces, and there would not be any debate in Congress about the Atlantic Treaty, because the Russians would be at war with America. I say that two divisions of American troops badly armed are worth ten divisions of German troops for deterring the Russians because they are tokens of the whole might of America. I warn the House that if we end the occupation, and if we sign a treaty with the Germans and enable them to have their troops, the Americans will not stay in Germany, and we shall be that much weaker as a Western organised power. What a fantastic exchange, to exchange the presence of American troops for five German divisions which, for all we know, will change sides, as Germany changed sides in 1939, and fight on the other side.
  I have not mentioned the internal German problem. It is true, of course, that if we talk about re-arming Germany and do anything to turn the Germans into soldiers again, German democracy is
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  killed at that moment. Every social democrat in Germany is begging us to stop this talk of re-arming the Germans. They say that there is no chance of democracy if we re-arm the Germans because back will come the people to power who really believe in German re-armament. I heard the Leader of the Opposition tell us that General de Gaulle was probably the greatest Frenchman today; but if there is a greater danger to French democracy than de Gaulle, I do not know what it is. We have to face the fact that to re-arm Germany, or even to talk of re-arming Germany, destroys the basis on which we can build any hope of German democracy, and French democracy too.
  I want to conclude by suggesting this to the House—and I am very glad to see that the right hon. Member for Warwick and Leamington (Mr. Eden) has returned. I believe that this country should keep to its long-term European policy. Its long-term European policy is to achieve unification of Germany and its neutralisation in a peace treaty with the Russians. It may take ten years or fifteen years, but it is the only sound policy. Unify Germany, disarm Germany, neutralise her and guarantee her against aggression from both sides, and then all of Eastern Europe and Western Europe are very likely to be happy and united. Arm her, and we make the unity of Europe impossible; the ultimate dream we always had of the Slavs coming back and the Russians withdrawing also becomes impossible, and we make war very much more likely than it is. For that reason I believe that whoever believes in European unity must stand up and say "No" to the idea that five German divisions are worth the withdrawal of American troops—[Interruption]. The Americans are not going to stay in occupation of Germany if Germany is an independent country with an army of her own.
  Mr. Boothby: Is it the hon. Gentleman's proposal that the American Army should permanently occupy Germany—for ever and ever?
  Mr. Crossman: No. Until the peace treaty is signed by East and West guaranteeing the neutrality of Germany, the occupation of Germany should continue.
  Mr. Boothby: That is permanently.
  Mr. Crossman: The hon. Gentleman says, "That is permanently," but he made a most moving speech in which he said that we must never forget the possibility of working for a settlement with the Russians. If we believe that there could be a settlement about atomic warfare, equally there could be a settlement about Germany.
  Mr. Boothby: I said that there was no question of a settlement.
  Mr. Crossman: The hon. Gentleman's speech must have been the only one from the Opposition side which did not say, "Even at this late hour, let us try for a settlement." I am disappointed that he did not say so. It is common sense to say it.
  8.28 p.m.
  Mr. Braine: In summoning up my courage to address the House for the first time, I trust that the fact that the gunpowder material designed to blow up this historic place came from my constituency in the year 1605, will not cause hon. Members to look upon me now or on future occasions with suspicion. I pray that, however imperfectly I may express myself, my speech will be received by hon. Members with that kindly tolerance which they normally accord on such an occasion.
  If I intervene in this Debate at this late hour—a Debate in which there has been so much wisdom expressed on both sides of the House—I do so because nothing I have heard has removed the feeling which I have had for a number of years of being profoundly disturbed at the deterioration of our position in the world and at the lack of vigour and cohesion in the conduct of our foreign policy. In the lifetime of most of us, there come moments when the pressure of circumstances forces us to take stock of our position, to survey our resources, to stiffen against misfortune and to examine our conduct. As with individuals, so it is with nations. Such a moment, or so it seems to me, has come in the life of this nation.
  It is clear from the Debate so far that everyone in the House is filled with apprehension about the international situation. We know that gone are the spacious days when Disraeli could speak of the streak of silver sea which separated us from the Continent and when we could snap our fingers with impunity at our
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  continental neighbours. We know that gone, too, are the days of splendid self-assurance when this country had a monopoly of the world's trade, commanded every sea and had a firm belief that she was destined to rule the world. We know these things. We know, too, that we are still the centre of a great imperial system with rich resources, but it is one of the tragedies of the post-war world that no attempt has been made to treat that system as a unit of power capable of developing a global policy of its own. We know that today we are near-bankrupt, rich in precious little but history, and that we are poised precariously between two world Powers and dependent—let us be quite frank about it—in part upon the kindness of one of them.
  What disturbs me about our people is that since 1945, after a war in which they displayed all their ancient valour and qualities, they seem to have turned inward upon themselves. They have become so obsessed with their own domestic problems, with the clash of party and sectional interests, that they have grown unaware of the mounting insecurity of the world in which they live and the danger that that represents to their way of life. The point I am trying to make is that foreign affairs are every man's affairs, and yet there are millions of people in this country who do not understand that those who govern one-half of the globe seek by treachery and trickery, by violence at selected points and by sabotage and internal disruption almost everywhere else, to overcome and to enslave the other half. There are literally millions more who, while they are aware of these things, have no real sense of urgency about them. For this lack of awareness, which is one of the reasons why I submit that this country has followed a weak and ineffective foreign policy since the end of the war, right hon. Gentlemen opposite and their friends cannot escape full responsibility.
  It may be that I am skating on thin ice in saying so in a maiden speech, but I must speak as I feel, and this is a matter of such grave seriousness to our country that I must say exactly what is in my mind. There seems to have been a kind of conspiracy—unwittingly, perhaps—to conceal from the people of this country the grim realities of the world in which they live. At no time was that more apparent than during the late General

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  Election when one might have expected full and frank discussion of the nation's problems. Yet right hon. Gentlemen opposite throughout the campaign studiously avoided any discussion of the subpect of foreign affairs. Indeed, when my right hon. Friend the Leader of the Opposition sought to break through the deadlock between East and West, he was accused of an election Stunt.
  Why this strange reluctance to discuss foreign policy? Is it that right hon. Gentlemen opposite, for reasons they know best, believe that the British people must be spared uncomfortable truths, must be coddled and sheltered, or is it that they are painfully aware of the drift in our affairs—as indeed some of the speeches in this Debate have revealed—yet are frightened of the Communist tail which wags the Socialist dog? I do not know, and it is not for me to plumb their motives in this matter. One thing I do know, that all the lesser objectives of political parties, all the things upon which hon. Members have set their hearts, and rightly so—the Festival of Britain, the provision of council houses in the ratio of nine to one, the social services, even the provision of cattle grids—all these are quite incapable of achievement if, as a result of the pursuit of a flabby and ineffective foreign policy, the country is led to destruction.
  It has been my fortune to travel about the world, and I have had the impression since 1945 that we in this country have ceased to mould events. Instead we are driven remorselessly by them. Foreign policy, it would seem, is no longer decided by the will of a British Government; we are the victims of world circumstances beyond our control and are no longer free agents; while the actions, indeed the purposes, of the British Government are decided by the actions and purposes of other governments or of the United Nations organisation.
  I do not wish to be uncharitable. It is true that in some matters the Foreign Secretary has been quick to move, as in the case of his acceptance of Mr. Secretary Marshall's generous offer of assistance in 1947 and again in regard to the Brussels Treaty and the Atlantic Pact. Yet it is equally true that the initial thought and inspiration in these matters came, as Mr. Marshall has himself
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  attested, from my right hon. Friend the Leader of the Opposition. It is a most painful experience to re-read the speeches made by my right hon. Friend at Fulton, Zurich and elsewhere and then to observe the gap in time between his pronouncements and their translation into some kind of action by the Government. In the conduct of foreign policy it is important not only to be right, and to be consistently right, but to be right at the right time. Moreover, it is necessary not only to take the right decisions but to be firm in implementing them. As has been pointed out in this Debate, it is true that a policy of firmness carries risks with it, but it is equally true that a policy of vacillation and timidity carries with it the certainty of ultimate defeat. After all, it is a fundamental law of life that one cannot breed strength out of weakness.
  I want to ask a question. When are we going to assert ourselves? How much longer are British subjects to be maltreated, how much longer are British sailors to be murdered and British diplomats to be insulted without some retaliatory action on our part? The catalogue of injuries to our interests and affronts to our prestige since 1945 has been long and humiliating—too long and too humiliating. The difficulties which beset us, the existence of the United Nations organisation, do not rid any British Government of responsibility for safeguarding British interests. What British interests are served by maintaining, on the one hand, diplomatic relations with Governments which violate every human freedom whilst, on the other, rejecting with horror any suggestion of re-establishing diplomatic relations with Spain with the object of adding the strategic advantages of that country to the defence of Western Europe? I may be a simple soul, but to me such discrimination is hardly logical. It seems to me to be rather a case of applying in the field of diplomacy the old adage of cutting off one's nose to spite one's face.
  While I am on this particular subject, may I also inquire what British interests are served by the recognition of the Mao Tse Tung régime in China at precisely the time when our own forces are locked in bitter and bloody conflict with Communist forces in Malaya? I was very interested to hear what the hon. Member for Coventry, East (Mr. Crossman) had to

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  say of the difference between one kind of Communism and another. Surely the hon. Member is aware that at this moment Communist agents from all over the world, and in particular from the countries bordering the Pacific, are in Peking receiving their marching orders. I cannot see the logic of recognising Communist China at this stage in advance of other Commonwealth countries.
  Upon what principles—indeed, upon what short-term advantage—are such actions based? One cannot peer too far into the future, but does anyone in this House really believe that a sincere partnership with a Communist Government is possible, that one can clasp the hand of a Communist in true friendship, or that one can trust his word? If not, and I have heard no evidence in the Debate to suggest that anyone does believe that, then why at this critical stage of the "cold war" should the hand of Communism in Malaya be strengthened by this incomprehensible action?
  There is, I suggest, ample evidence that a policy of firmness with the Soviet Union or her satellites would be repaid with handsome dividends. All experience in Eastern Europe has shown that a policy of friendship and collaboration with the Soviet Union emboldens that country to further aggression. But experience also has shown that, before a display of firmness and strength, as in the case of Northern Persia and Greece, the Soviet Union wilts and retreats.
  What has so far stayed the hands of the men in the Kremlin? The armies and air fleets of Western Europe? The divisions of Americans in Germany, to which the hon. Member for Coventry, East, referred? The committees of Western Union? Or even the speeches of right hon. Gentlemen on both sides of this House? The whole world knows that the sole restraining factor has been the possession by the United States of atomic weapons. Surely, there are two conclusions to be drawn from this: first, that the Soviet Union is unwilling to risk war with conventional weapons, in which, although we have no information, it is reasonable to suppose she has a superiority, for fear of the consequences of the use of unconventional weapons; and second, that she will continue to expand her interests in the world as long
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  as she feels that she can do so by exploiting weakness in the West. Yet the fact is that the West has the initiative, if only it would use it.
  It may be asked how we, as distinct from our other partners in the grand alliance, are going to "get tough" when beset by economic difficulties at home which impair our recovery as a trading nation and our defence as an imperial Power? The strength or weakness of foreign policy is a reflection of the strength or weakness of domestic policy. The matter was perfectly expressed by the Foreign Secretary as long ago as 1947, when he told us that if he had 30 or 40 million tons of coal a year for export it would do more than anything else to strengthen his hand in getting the world back on its feet. But he did not get 30 or 40 million tons of coal at that time, nor have the Government succeeded yet in getting the full response from the people of this country, precisely because at no time in the last few years, either in domestic or foreign policy, have the people of this country been made aware of the danger in which they stand.
  The art of statesmanship consists in making people aware that something needs to be done and then in persuading them to do it. Somehow we must find the means of arousing the nation from its lethargy and sense of false security, to an awareness of the very real danger in which it stands. As a beginning, I make a suggestion. It is not a new suggestion, but I advance it in the new circumstances of this Parliament.
  I suggest that this House should be given very much more information on the subject of international affairs and given that information more frequently than in the past, so that future foreign affairs Debates become very much less of a Cook's tour round the world, very much less of an inquest upon the failure, disappointments and frustrations of the preceding six months, and more of a springboard for action. It should not be difficult for the Foreign Secretary to comply with this request. He has a reputation for sincerity and patriotism. He is not hampered in his difficult task in this Parliament by those hon. Gentlemen who sat in the last Parliament, for British constituencies, but who more truly represented lands east of the Iron Curtain. He should know, of course,

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  that in all that needs to be done to protect vital British interests, he has the wholehearted support of this side of the House and of all men and women of goodwill.
  With the utmost respect to the Foreign Secretary, may I recall the words of a very distinguished Member of this House, speaking in not dissimilar circumstances after the loss of the American Colonies? I recommend hon. Members opposite to take note of the warning:
  "If we make ourselves too little for the sphere of our duty, if on the contrary we do not stretch and expand our minds to the compass of their object, be well assured that everything about us will dwindle by degrees until at length our concerns are shrunk to the dimensions of our minds."
  We live in times of great peril, times which demand a great deal more courage and imagination in the conduct of our affairs than we have had in the past. In short, times which call for that greatness of which this country has so rich a fund.
  8.50 p.m.
  Mr. Follick: Following the tradition of this House, I congratulate the hon. Member for Billericay (Mr. Braine) on a very forceful speech. I should also break away from the traditions of this House by congratulating him on his skill in avoiding every controversial subject possible, because, as is well known, as a part of our almost sacred traditions, we are not supposed, in a maiden speech, to introduce controversial matter. I therefore congratulate the hon. Member on having abided by the traditions of this House.
  We have been discussing foreign affairs to a great extent today, and Russia has been one of the most important items raised in the Debate. We are, in fact, already treating Russia as an enemy at war, at the same time forgetting that Russia is actually still an ally of ours. Up to 1939 Russia and Communism were synonymous. Russia has been using Communism as a force of expansionism in the same way as in the past she used the Orthodox Church and, later, pan-Slavism. The expansionism of Russia has taken more effect since the defeat of Germany. The one tragedy of Europe is that the Germans are the only people who can contain Russia. But the moment
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  Germany is allowed to build herself up to the condition in which she can contain Russia, she becomes a menace to the rest of the world. That is and has been the tragedy of Europe for the last 500 years.
  I should like to bring to the attention of the House in some degree the magnitude of the expansion of Communism, because that expansionism has not yet finished. It began by taking in certain Slav countries—Poland, Czechoslovakia and Bulgaria—and at the same time other countries which were not Slav, such as Hungary and Roumania. These have come within the orbit of Russian domination. They are satellite countries. Russia has had her influence in Asia because the development of Communism there cannot be divorced from the influence of Russia in Asia. China has succumbed to Communism, and it may be that Communism will spread into Tibet, and there is no reason so far as we can see why it should not also pour over into Afghanistan. In this way, if there is to be trouble in India, between India and Pakistan, and if war breaks out between those two countries, there is every possibility of Communism spreading to the Indian peninsula and so engulfing the whole of South-Eastern Asia.
  It is a magnitude that few of us envisage at present, but even that is not the end. There is nothing to prevent it from spreading to Africa as well. Some time ago, in one of the Debates in this House, I said that the battles of the next war might very well be fought not in Europe at all, but in Africa. Last year I spoke to Dr. Jansen, who is the Minister in charge of native affairs in the Union Government, at a time when they were having trouble with the Indians in Natal. I said that surely it would be no difficulty for India to absorb another quarter of a million people. He said, "No, they wanted to keep them there as a foothold." So that is the measure of how Communism may spread throughout the world.
  It is not the sort of Communism which would be dominated by Moscow. This very Communism spreading throughout the world, may bring about the breaking of the whole power of Russia. There is an adage in Russian which says that Russia always breaks her own back. That is the magnitude of the possible expansion of Communism.

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  But let me reply to the hon. Member for Billericay who said that this country is a bankrupt country, a weak country. This country, which has spent £28,000 million fighting the last war, and has recovered from that, is by no means a bankrupt country; and is the centre of a great Commonwealth of Nations—
  Mr. Braine: If I may interrupt the hon. Member, and if my recollection serves me right, I did not say that this was a bankrupt country; I said she was near bankruptcy.
  Mr. Follick: I will not argue over the word "near."
  Mr. Braine: It is an important distinction.
  Mr. Follick: Far from being a weak country, it is the centre of a Commonwealth without whom it would be impossible to make any effective resistance to Communism. The United States alone cannot possibly do it. The United States has to depend upon this island and Australia because those are the two strong points without the help of which, the United States cannot resist Communism.
  Do the Russians themselves want war? That is the question. Knowing the dangers that are besetting them by this expansion of Communism in these other countries, do they want war? Russia knows more about Asia than any other country in the world, because more than half of Russia is in Asia. Russia knows that if there were another war, and she lost it, the consequences would be much more disastrous for her than the consequences of the last war were for Germany. Russia is the only great European Power which has fought three major wars this century; and each one has been more disastrous for her than the previous one.
  It is true that after the last war she increased her territory, but that does not mean to say that she has not suffered a major disaster by having fought the last war. We ourselves have suffered disaster. We are no longer the powerful nation that we were. This same disaster has hit Russia. Russia knows that if another war were entered into by her and if she were defeated, whatever accretion of territory she has been able to achieve since the last war would
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  be lost, in the same way as Germany lost the territory which Hitler procured for her.
  In the Debate on the Estimates, I listened to the right hon. Gentleman the Leader of the Opposition speaking about the submarines which could do 20 knots and the jet planes which Russia was producing in tremendous quantities. I was in Moscow in 1933 when the first motorcar produced on an industrial scale was shown to the people. If Russia has been able to improve her industry, despite the years of war, until it has reached a scale where it can compete successfully with our own, and even produce better machines of war than our industry, then the whole of her system of education must be on a very much higher level than we imagine. In order to produce this class of goods industrially, not only are factories required. A whole basis of primary and secondary schools, universities, polytechnics, technical institutes, and professorships are needed to secure tens of thousands, even hundreds of thousands, of technicians and scientists.
  If the Russians have reached that stage in such a short time, surely they must be the first to understand the great future which awaits them in the development of Asia if they wish to continue living in peace. They must realise that war would smash the whole of that achievement. I cannot believe that the Russians want to lose all that they have gained when they are the first nation to know what are the disastrous effects of war. Not only have they seen the effects in their own house; they have also seen them in their neighbour's house. I have heard a lot about slave labour in Russia, about concentration camps and the forceful means that the Russians employ for keeping their people under control. One can keep ignorant people under by means of arms, but one cannot keep thinking people under—especially thinking people such as the Russians, because for the last century the Russians have been the most revolutionary people in Europe. Even while the Russians were ignorant, the Czarist armies and the Cossacks could not keep them down. They revolted in 1906, and in 1917 they blew the whole thing up sky high.
  Will anyone tell me that that nation, with the educational basis which Russia

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  must have in order to produce this industrial output, would put up with the harsh treatment which is supposed to exist in that country? I do not know; I have been to Russia three times, but Russia will not let me in at present. I believe that it is this secrecy in which the Russians have enshrouded their country, that is making it difficult for us to understand Russia. If they would only open up their country by means similar to those of Intourist and other systems, such as have been used before for the encouragement of tourist traffic, I believe it would be better for all of us. If we could only get an understanding of the Russian Government and people, we would have a better understanding of their difficulties.
  The real trouble with Russia, of course, is that she went from one system of absolute rule to the opposite extreme, from the absolute rule of the Czarist system to the dictatorship rule of Lenin. We do not know at present how far Russia has developed from the old system, but if we could only get into the country and find out, it would be better for the whole world. Indeed, I say that it would be better for the rest of the world if Russia would open her doors.
  There is one spark of hope for us in what is happening in Yugoslavia. Just as Marshal Tito has resisted the dictates of Moscow, other satellite nations may follow Yugoslavia's example. Russia may prevent Poland or Czechoslovakia from doing it, but she could not prevent them all from doing it at one time, and if the satellite countries would follow the Yugoslav system and all insist upon their own national development, that alone would have its effect. If we are to depend upon Germany, we shall find that what has happened in the past will happen again. The moment that Germany has built up sufficient strength to contain Russia, she will become a menace to every other nation in the world. For that reason, I say that if we can only get a better understanding of Russia and of the problems of Russia, and if we realise, as Russia herself must realise, that the whole of her future would be destroyed in risking war, we might rid ourselves of this bugbear, this nightmare and this fear of Russia as an enemy, when she may not be an enemy at all.
  9.9 p.m.
  Mr. De Chair: This Debate has been marked by a number of remarkably good maiden speeches, and I have myself almost felt that, as I have been out of the House for four and a half years, I should ask the indulgence of the House this evening. As I made my maiden speech in this House 15 years ago, at the time of the Abyssinian war, it would not be appropriate of me to show too much maidenly modesty at this stage. It is a fact that foreign affairs were worrying and preoccupying the House at that time owing to the resignation of the then Foreign Secretary in the opening stages of the House of Commons which succeeded the election that had been fought on foreign affairs, although in those days we did not regard foreign affairs as an election stunt.
  Since 1935, half the world has been laid in ruins and the fabric of Western Europe has been revolutionised, and one wonders from what pinnacles of fame or depths of disaster in 15 years time those who have been making their maiden speeches today may look back upon the international situation which confronts us at the present time. Will they laugh together and say, "All we had to worry about in 1950 was the hydrogen bomb and the presence of 300 or 400 Russian divisions ready to march in any direction"? It is difficult to visualise to what pass the world may come in the next 15 years unless some solution is found to the grave problems which we have been discussing today.
  In this connection, I wish to take up the point dealt with by the hon. Member for Northfield (Mr. Blackburn) about the deadlock over the control of atomic power. I think he was right in pointing out that there is not much realisation in this country of the extent to which Russian delegates—for whatever their words may be worth—have gone at Lake Success in the matter of concessions over the question of inspection of atomic control.
  The gulf that separates the majority and the minority plans over the control of atomic energy, that is to say, broadly speaking, the American and the Russian points of view, is simply that, whereas Mr. Vyshinsky did go so far as to agree to periodic inspection—not, as the hon.

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  Member said, at stated intervals, but at irregular intervals to be determined by the Control Commission working without the veto within its sphere—the American point of view, as embodied in the Baruch plan, was for ownership of all processes of atomic developments in all the countries concerned.
  If we really want to make some new approach to Russia, whether it be the top level, the middle level or the lower level, inside or outside U.N.O., it is quite useless to do so expecting that Russia will ever agree to a system of atomic control which requires the ownership of the means of atomic production inside the U.S.S.R. She simply will not consider a system of control on that basis. Yet Mr. Acheson stated very recently, indeed on 8th February this year, that he considered the Baruch plan still valid and saw no reason why the U.S.A. should alter its approach or modify its proposal.
  If that is so, there is no hope—and we should face it—of reaching agreement on atomic control with Russia, with her mania for secrecy and her desire to develop atomic energy for industrial purposes. She will never agree to a system of international ownership of production. Indeed, it is remarkable that she has come so far out of her shell as she has and that Mr. Vyshinsky should have agreed on behalf of his Government to periodic inspection at intervals to be determined whenever the Control Commission deems it necessary. I only put that forward because I think a good deal of our discussion about breaking the deadlock is merely academic if we are going to insist on the Baruch plan and what the Americans regard as an absolutely watertight system of control.
  I now wish to pass to another aspect of our relationship with the United Nations organisation—the question of the future of Italy's former Colonies under the Trusteeship Council of the United Nations organisation. There is a good deal of anxiety in this House and in this country about a new form of power politics which is beginning to appear at Lake Success. Under it, for example, by being able to mobilise the Latin-American bloc and playing off East against West in Europe the Italians are able to secure concessions under the United Nations which were never the intention of the United Nations Charter or of the Trustee-
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  ship Council. We find that Italy has been granted the administration of Italian Somaliland for ten years. In the case of Tripolitania I do not think His Majesty's Government were guiltless, because, by the notorious Bevin-Sforza agreement, the Foreign Secretary agreed to hand over Tripolitania to Italian rule again.
  No doubt obsessed by the desire to keep Italy out of the Communist bloc, he was anxious to give Italy this concession. But it must have been in defiance of expert advice in Tripolitania and of the military control there. I am glad to say that the United Nations Assembly turned down the proposal. But in its place they suggested that Libya is to have independence by 1st January, 1952—not merely Tripolitania but also Cyrenaica and the Fezzan. When he replies I should like to know from the Foreign Secretary what practical steps are being taken now by our military administration in Tripolitania to prepare for this transition of power, which is to come so very soon, and how it is to be achieved. While it is easy to see how independence can be given to Cyrenaica under Emir Idris el Senussi, the chief of the Senussi, it is difficult to see what sort of constitution is proposed, and is being prepared within two years, for the whole of Libya. Are the French agreeable to hand over the Fezzan to this independent administration?
  At the moment there is a commission of the United Nations in Eritrea consulting the wishes of the inhabitants. I gather it is proving a very difficult task, because so many different points of view are being placed before them. It may be that the views of the Muslim League of the western province, who are beginning to favour partition, may find acceptance. Whatever happens I sincerely hope that once again we shall not be confronted with a system of power politics under which Italy, will be able once again, to secure control of Eritrea.
  There is a further point with which I should like to deal with regard to this area. That is the question of the revision of the Egyptian Treaty of 1936, which is still in operation and lasts, in effect, for 20 years. There is a provision that after 10 years, that is after 1946, by agreement of the high contracting parties, the treaty can be revised. The present Government

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  of Nahas Pasha was the Government with which we concluded the treaty in 1936. Presumably, therefore, we should have a favourable reception from his Government for a revision of the treaty. It is worth noting that the revision Clause in Article 16 of the Egyptian Treaty provided that any future alliance shall maintain the principles contained in Articles 4, 5, 6 and 7 of the 1936 Treaty, which in effect embodied most of the strategic advantages of that treaty.
  I hope that it will not be beyond the capacity of His Majesty's Government when they come to discuss these matters with the Egyptian Government, as they are bound to do shortly, to convince them of the fact that the Canal Zone upon which we have lavished so much money and where we have such a large establishment, is not an infringement of Egyptian sovereignty at all. It lies outside the Nile Delta in a barren area of desert which we have made to blossom—perhaps not very much like a rose, but at least we have made it habitable for soldiers. I spent some of the most uncomfortable periods of my life in that place, and I would not say that it was comfortable. The Egyptians need not feel that we have robbed them of any particularly fruitful area of desert.
  At the same time, when we consider the menace to the world which has been the subject of discussion in this House today, and of which the Egyptians themselves are only too fully aware, I do not believe that it is impossible to convince them that this base is an adjunct to their national sovereignty. If we in this country are able to provide a bombing base for Americans in East Anglia without any sense of infringement of our national sovereignty, the Government should not find it difficult to persuade the Egyptians to regard the matter in the same light. The Foreign Secretary chose not to open this Debate but rather to leave it to hon. Members to make a tour d'horizon. I hope that when he winds up he will not complain if he finds that he has got too much horizon to tour.
  9.22 p.m.
  Mr. Tomney: I crave the indulgence of this House. I have sat here very patiently today and have listened to so many brilliant
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  speeches that I am afraid my maiden speech has by now become an old maid. The circumstances which have made this speech possible are, perhaps, in these days of Parliamentary representation, becoming somewhat remote. By that I mean that I have come directly from the benches of a factory to the benches of the Commons, and I think it augurs well for our Parliamentary system that even in these days when these benches are full of legal, journalistic, scholastic and commercial talent, such a thing is still possible. I think it is a good thing for the Labour Party, too, whose strength and balance have always been derived from the essential and the productive members of the working class.
  The subject of foreign affairs is, I know, a very difficult one for a maiden speech, but I think that all maiden speeches are difficult, and as one has to start somewhere one might as well start on the most difficult. I fought my own election campaign on this subject, and, as hon. Members know, the result was somewhat surprising. The Communists and the pro-Communist elements of the last Parliament have been scattered to the four winds and I am happy to say that I played no small part in this myself.
  The difficult problems confronting the world, the United Nations organisation and this country in particular, are tremendous, but the greater the problems the greater must be the effort to overcome them. The difficulties of Great Britain are, in my opinion, greater than the difficulties of any other nation. We have always been the potential moral leaders of the world. We changed from potential to actual moral leaders with the advent of the Labour Government in 1945. But we inherited a situation which in every phase of our national life has no parallel in history, and it is to the everlasting credit of the Labour Government that we have made the progress that we have.
  The disgraceful neglect by hon. Members of the Opposition, who had charge of British foreign policy in the bad years between 1931 and 1939, is something upon which historians will record their just and true verdict. I do not wish to dwell upon it tonight, but the situation confronting us today is in no small measure the result of that neglect. We can only hope to secure and expand

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  the fortunes and economic destiny of our people, both in this country and in the Commonwealth, if Great Britain is a respected power in foreign affairs, in concert with all freedom-loving democracies on equal terms under the authority of the United Nations.
  Our greatest problem, in my opinion, is the Asiatic and Far East problem, and I believe the successful settlement of this problem will settle the destiny and the peace of the world for many generations to come—I hope for all time. Despite what has been said today about Germany, I believe India is the focal point upon which our policy and the policy of the United Nations should chiefly concentrate. Its great potential, its millions of population, and its proximity to China are matters of supreme importance. The similarities between their present systems, the religious institutions, the cultures and the abject poverty are at once an object lesson and a challenge to the Western democracies. Too long, far too long, Western civilisation and, in particular, Great Britain, neglected these millions. Our only concern, I think, was to exploit them. If we had lifted them to a higher social plane when we had the opportunity and the power, to a higher degree of social well-being, we should not today be in our present state in foreign affairs.
  Time is short and time is not on our side in the world today. If we want to save the Far East and India from Communism, we must act boldly and we must act at once. The solution of these problems does not lie in the use of military force or in the atomic bomb or the hydrogen bomb. I say that for consumption in the Soviet Union, too. The solution lies in the immediate expansion to the rest of the world of the Socialism we are now enjoying in this country, and with all possible speed. We must give to these people the practical rewards and applications of democratic Socialism without delay, as an alternative to Communism. They must be offered something better than Communism.
  The vast majority of them have for centuries been without standing, without hope and without goods in their own land. The United States of America have some very serious thinking to do in these matters. I am, of course, thank-
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  ful for the generous aid given by the United States through the agency of Marshall Aid, but it is not enough. What is wanted, even in the United States, is a change of political heart and purpose very quickly. I know they are now in a process of moving ever so slowly towards a welfare State. Their great industrial potential, along with our own, can quickly change the political face of the globe. We both need export markets for our economic survival, and the greater the consumer capacity of the rest of the world the greater our own social benefits.
  Let us uplift these people to a full democracy, a full consumer democracy, and the threat of Communism will vanish for ever. I know this is a tremendous project. We have in this country a political and economic democracy which has been brought to us over a period of 800 years. If we want to secure the freedom of mankind from the tyranny of Communism all over the world, we must marshal all the forces of democracy in a great effort.
  I find myself today in full agreement with my hon. Friend the Member for Coventry, East (Mr. Crossman) who laid great stress upon the problems of India and the importance of peace in that part of the world. I believe that in that part of the world lies the deciding of the world's peace—that it lies there more than in any other part of the world. It is becoming more patent every day in Western and Eastern Europe that the time will come when the European peoples ruled by Communists will, by their own volition, shake off the people who now dominate them. In Eastern Europe advantage was taken by the Cominform of the fact that physical fortunes and the will to resist after the war were very low indeed.
  I believe that in years to come the peoples of Eastern Europe will settle this problem for themselves. The position in regard to China and India is, however, far different. We must pay our long outstanding debt to India, give all the help we can to Pakistan and to Pundit Nehru, lift up the peoples of India to full democratic and consumer status as quickly as possible, and let that advance radiate from India through the Far East as an example and alternative to Soviet Communism.
  9.32 p.m.
  Lord Dunglass: It falls to my lot to congratulate very sincerely the hon. Member for Hammersmith, North (Mr. Tomney). He need not have been diffident about making his maiden speech, and we hope we shall hear him on many other occasions. If I may say so to him, he has endeared himself particularly to me, because he put out of this House a former Member who used often to cross swords with me in foreign affairs Debates in a previous Parliament.
  The reason why we asked for this Debate at this time was that we had a very strong impression that the Government, in this most important field of national policy, were marking time, and nothing that has been said from the other side of the House today has removed that impression. If I may quote two sentences used by the two right hon. Gentlemen most responsible for foreign affairs, I would quote the Foreign Secretary, who, after my right hon. Friend the Leader of the Opposition made his speech in Edinburgh in relation to the Russian deadlock, said, roughly speaking, "I have done my best." I would also quote the Prime Minister who, in the Debate on defence in this House only a week or so ago, in reference to implementing the findings of the Colombo Conference and the Atlantic Treaty, said that in these matters
  "One cannot force the pace."—[OFFICIAL REPORT, 16th March; Vol. 472, c. 1397.]
  However much the Foreign Secretary may have achieved—and he has much to his credit—we shall not gain security in this country by resting on the right hon. Gentleman's laurels. Nor can we possibly afford in this country at this present time to mark time in our foreign policy. We on these benches have a deep conviction that it is Great Britain's rôle in world affairs to take the lead, and unless we force the pace at this time many another country which finds itself within the Russian orbit will lose its freedom.
  The first plea—and here I join with the hon. Member for Hammersmith, North—the first plea I would make to hon. Gentlemen on the other side of the House is this, that they should take positive action, and that they should begin by taking positive action in respect of what is called the "cold war." We have heard a good deal in the speeches today about the "cold war." Of
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  course, the "cold war" is relentless and menacing. Russia has perfected a technique in this matter of using the Communist party first to probe and then to soften the weak spots in any national resistance, and always behind the Communist spearhead are the armed forces of the Soviet Union ready to mobilise. That is perfectly true. Although the situation is grim, I believe that, as the hon. Member for Aberdeenshire, East (Mr. Boothby) said in his speech, this is a situation which we have to face and which may last for a very long time. There are factors in it which are not without encouragement and may even be to our advantage. Communism, as it has spread over Europe, has created an opposite force, and that opposite force is based on the most potent and powerful of all things, and that is moral and religious conviction. We should be trying to turn that to our advantage.
  It is now revealed beyond doubt in many countries that may have had doubts after the war, that Russian policy is no more than a ruthless exercise in power politics, and the recognition of this fact should give us the opportunity to bring into alliance many countries who, before this situation was revealed, were looking at each other with eyes of suspicion. Another fact which I would bring to the Minister's notice, and which I think has escaped attention generally, is this: That in no case has Russia either moved her own troops or ordered one of her satellites to move their troops where she has had a clear warning from the United States of America or from ourselves. In no case has that happened.
  I make this suggestion: When we looked at Europe three or four years ago it was quite possible to believe that Communism would overrun France, Germany and Italy, but there has been a spontaneous natural reaction, and the tide of Communism has been pushed back in France, Germany and Italy, and even in Eastern Europe at the present time there are certain rocks beginning to appear in this Communist sea.
  I believe that the intelligent use of political warfare, if we like to call it such, certainly of political propaganda intelligently directed, can, at this very moment, save two countries and bring them out of the Russian orbit. I am not going to name the countries, but I

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  think that if intelligent political propaganda were directed into them, they could be saved and are ripe for saving now. I know that we do direct a certain amount of political propaganda into Eastern Europe, but I do not believe that it is co-ordinated and that it is nearly as efficient and effective as it could be. There is a very large and effective broadcasting station in Turkey. I ask the Minister of State to think of this: Will he from Norway through Western Europe to Turkey see if he can organise a co-ordinated propaganda offensive into the satellite countries on Russia's borders.
  I could not help thinking when I saw the obvious concern and terror with which Russia views any knowledge of the Western world being brought into satellite countries and behind the Iron Curtain that that is a measure of her fear. We ought to be all the more insistent to push a knowledge of the Western world into those countries and to help those people, the churches and others, who are fighting a valiant battle behind the Iron Curtain for freedom. It seems to me that for a comparatively small output in money and energy we might achieve a great success which would have very significant repercussions on the military planning which we must do should a war develop and start in that area.
  I now turn in the short time remaining to me to the consideration of an overall security system. I think it is not unfair to say that Russia knows absolutely what she is doing in her own foreign policy. She has an over-all foreign policy, she has regional foreign policies, and she can switch from one to the other region whichever serves her best at the time. I believe it is not unfair to say that at the present time, after five years of foreign policy conducted by the right hon. Gentleman, His Majesty's Government have no over-all constructive foreign policy and are weak in every region which we ought to be in a position to defend.
  I look round at these regions—India, the Middle East and Western Europe—and in none of them are we strong enough either to impress our enemies or to gain the confidence of our friends. An hon. Member who has just made his maiden speech said we must be bold and strong, but the gaps that I see do not enable us to be so. There are yawning gaps in the Far East, the Middle East
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  and in Europe in the diplomatic and the political fields.
  I want to direct the attention of the Minister of State to the problem. Let us take the Far Eastern region. The Foreign Secretary and the party opposite cannot escape responsibility in this matter because it was they who created a vacuum of power in India. I am not criticising them for leaving India but I am criticising them for scuttling out in a hurry. All the way through history a vacuum of power has been—it always will be so—a temptation to an aggressor which cannot be resisted. We left India before India was able to defend herself and before India and Pakistan had had a chance to settle their dispute over Kashmir. I ask the Minister of State if the Foreign Secretary is, so to speak, knocking the heads of India and Pakistan together. Is he continuously keeping at India and Pakistan to settle this difficulty? Let him realise that unless that difficulty between India and Pakistan is settled there is no basis at all for the continental defence of India.
  Let me turn for a moment to the Middle East and to Turkey. It is well known that Turkey has for many years now been sustaining a full armament programme and that that is putting a very severe strain on Turkish economy. Is the right hon. Gentleman satisfied that Turkey is in a position to meet any challenge that may come from Russia in that part of the world? The Socialist Government lends money fairly freely about the world and I would far rather lend money to Turkey than to Burma, because I am convinced that it would show a far higher dividend in security. The Turks would fight.
  There is another problem which His Majesty's Government seem to me to be neglecting in the Middle East, the co-ordinated defence of those great regions inhabited by the Arabs. When this question is raised, I am told, "Oh, but His Majesty's Government think that Turkey ought to organise these regions into a great defence system." The Turks will fight but they have not the traditions or the diplomatic authority to organise those regions. Great Britain, and Great Britain alone, can do it and I ask the right hon. Gentleman to see to it now that conversations are started so that effective opposition can be organised in that area to

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  any advance that Russia may take in that direction.
  Lastly I come to Europe. I shall not deal with the question of how far Germany should be re-armed, but I express the hope that if Germany is re-armed in any measure, it should be done with the absolute agreement of the French and the Americans. I want to draw the attention of the Government to one aspect of European defence to which far too little attention has been given, the Scandinavian Republic and their contribution to the Atlantic Pact. We may put our frontier in future on the Eastern frontier of Germany, or we may contemplate the possibility that Russia will advance across Europe. In the first case, if we have our frontier on the Eastern frontier of Germany, Scandinavia is an essential flank guard; in the other case, if we contemplate the possibility of Russia advancing across Germany, then the Scandinavian peninsula again is in a strategic position which might prevent the Russians ever undertaking that venture.
  I understand that Norway under the Atlantic Pact has made certain reservations; that she is a member of the Atlantic Pact and subscribes to it but will not allow the Americans or ourselves to have bases in Norway. Could the Minister of State and the Foreign Secretary say to the Norwegians, who ought to be able to appreciate it by now, that it is no use taking these half measures. In modern warfare, unless one has a very advanced state of preparation, one is condemned before one starts. Every argument seems to me to point to the necessity for the Foreign Secretary reopening with the Norwegian Government the question of Norway allowing both air and naval bases to ourselves and to the United States of America.
  Lately, Mr. Acheson has made a most helpful series of speeches and has talked of the necessity for total diplomacy. I agree with him that nothing short of total diplomacy is possible in the present situation if we are to survive. And 1 point once more to those great gaps at the diplomatic and political level and say to the Minister of State that, until these gaps are filled, our military preparations will not make any sense at all. I ask him to ask the Foreign Secretary, both in respect of India and of Turkey and of the
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  Scandinavian Peninsula—in particular, Norway—to start talks with a view to completing an over-all intelligible system of defence. Our prime objective in all these regions must be to make ourselves so strong that we are feared by the enemy and gain the confidence and respect of our friends; and we must aim in every region to make them into a coherent whole, so that in the event of war we can build up the Grand Alliance on which always the safety of this country has depended.
  9.50 p.m.
  Mr. Pargiter: It has been rather interesting to listen to hon. Gentlemen opposite attacking the Government for pursuing a weak and vacillating foreign policy, and at the same time to hear the right hon. Gentleman the Leader of the Opposition saying that there is nothing between him and my right hon. Friend the Foreign Secretary, since the policy which the Leader of the Opposition has been advocating has been pursued by my right hon. Friend. The Opposition should really make up their minds which of these two arguments is right: whether the policy which they have advocated was weak and vacillating, or whether the policy which is being followed is a strong one, as their leader claims it is. I do not agree that our foreign policy has been weak. It has been determined and single-minded in purpose with a view to maintaining world peace. I am not at all sure, however, that some of the speeches which we have heard today from the Opposition have been designed to that end.
  In returning to the subject of Europe, I may not have many hon. Members with me when I say that I believe that not only should Western Germany not be re-armed; I believe also at this stage that Western Germany should not be admitted to the Council of Europe. If it were admitted, it would inevitably follow that Eastern Germany would be formally admitted to the Cominform and the gap between Eastern and Western Europe, instead of being narrowed, would become wider. It is vitally important that we should at all costs explore every possible avenue with a view to obtaining for Germany a peace treaty which will permit of a united Germany. That is of cardinal importance, and I do not believe it will be achieved by widening still

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  further the differences between Eastern and Western Germany.
  Nor do I think that it is Russian policy to start a shooting war. Russia has been far too successful in the method which she has been pursuing to want to start a war. In any case, this happens to be rather a battle of ideas and ideologies, which will not be defeated by the orthodox methods. I think Russia also believes that if a very large proportion of the efforts and resources of Western Europe and the United States can be diverted to the maintenance of large armed forces and war production, to that extent will the standard of life of the people be reduced and thereby form the basic ground upon which Communism feeds.
  I believe that we ought to endeavour to work, not for greater armaments, but, if at all possible, towards a progressive reduction of armaments. The proposition by the Leader of the Opposition that we should be talking to Russia from a position of strength does not appear to have worked out in practice. The fact remains that when the United States were, as far as we know, the sole possessor of the atom bomb, we obviously ought to have been in a far more powerful position to conduct negotiations; but that did not prove to be the case. Therefore, the basis of arms does not appear to be a ground upon which we are likely to achieve very much progress in our relationships with Eastern Europe.
  Now that Russia, according to reports, has the atom bomb, this seems to be the time when we should say that we can begin exactly as equals in negotiations, and we should see whether it is possible to get round the table once again to find some means of controlling atomic energy and abolishing atomic weapons of all kinds. I do not subscribe to the view that we shall get peace through power, which was suggested by the Leader of the Opposition, or that because terrible weapons are possessed on either side that is likely to prevent war. They have not prevented wars in the past; nor do I think they will in the future. The obvious thing is to endeavour to get round the table to see whether a way can be found out of the present impasse. That will not be easy, but an attempt should be made, and I hope the Foreign Secretary will use all his great influence, either through the United Nations or through the Great
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  Powers, to see that some attempt is made at the earliest opportunity
  This is not an occasion when we should touch very much on affairs outside Europe, but I feel we ought to know before very long what is happening in the Far East, not only in China, but also in Japan. There is an extraordinary dearth of information about what is happening in that part of Japan which is controlled by the United States of America. We have heard that it is the policy of General MacArthur to create a full-blooded capitalist organisation in Japan. If that is so, among the things we should like to know about it is, who is to control that kind of organisation? Is it to be the old autocracy which was in charge of Japanese aggression before? How far is it financed by American private capital, and what is its object? How far is it likely to be in line with the policy of this country and how far is it likely to be inimical to our interests?
  I believe there is grave disquiet in this country about the possibilities of Japanese aggression—commercial aggression at any rate—which is being fostered very largely by American capital, as is common in all capitalist countries where they have a cheap supply or a market. These things are not all separated, and they indicate that there is no concerted policy between Britain and America. Certainly there may be a concerted policy as far as Europe is concerned, but there appear to be some wide divergences of policy between Britain and America in the Far East. I hope, therefore, that in the near future we shall have some information from my right hon. Friend on the position in the Far East, particularly in Japan.
  I come back to the question of Europe. I repeat that we ought to be working towards a progressive reduction of armaments at the present time. I believe that Western Union should be used, not as the basis for building larger armaments, but to see how far there can be an effective reduction. I believe peace will come through reduction of armaments throughout the world and not through building them up.
  9.59 p.m.
  Mr. Eden: The hon. Member for Southall (Mr. Pargiter) complained in the early part of his speech of the criticisms which he

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  said had been uttered from this side of the House of the foreign policy, or lack of foreign policy, of His Majesty's Government. He then proceeded to deliver an indictment, far more severe than any speech we have yet heard, on the Foreign Secretary himself. The hon. Member's speech was based on two particular arguments the force of which I do not seek for the moment to controvert. One was that there was a complete lack of co-ordination between British and American policy in the Far East. That may be so, I do not know. If it is so, it is hardly a bouquet for the Foreign Secretary. The second was that it was wrong to try to bring Western Germany into the Council of Europe, but that we ought to wait until all Germany was united and bring the whole of Germany into the Council of Europe. That point of view—
  Mr. Pargiter: I did not say that we should bring Western Germany into the Council of Europe because I believe that the time when we have a united Germany will also be the time when the Council of Europe will be unnecessary.
  Mr. Eden: What I understood the hon. Member to say, and I listened very carefully, was that he did not wish Western Germany brought into the Council of Europe; he wanted either to wait until there was a united Germany or until I know not when. That is the exact reverse of the foreign policy which the Foreign Secretary is following, and I think rightly following in the present circumstances. The Foreign Secretary is rightly proposing that that part of Germany that is free should be admitted into the Council of Europe, and I do not myself see that he has any choice in the matter but to do that. In every point which the hon. Member made in the course of his short speech he was in direct opposition to the Foreign Secretary. If the hon. Member has not quite understood that he should read his speech tomorrow and then see where he stands.
  We have had a Debate which has inevitably, on this topic, covered a wide range of ground, and we have had an attempt by Members in all parts of the House to try to make constructive contributions in an international situation which is causing all of us ever-increasing concern. I think that was fundamentally
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  the temper of the House. We have had some remarkable maiden speeches. I am not going to attempt to list them all, and it would be inviduous to try to do so, but I must say a word about that of my hon. Friend the Member for Taunton (Mr. Hopkinson), who, as the Foreign Secretary knows, has for many years given most valuable service in the Foreign Office. Party politics apart, we can all feel that his wisdom and experience will be of value in our foreign affairs Debates. I must also say a word of welcome in respect of the speech of the hon. Member for Nottingham, Central (Mr. Ian Winterbottom), who showed first hand knowledge of the German problems which he was discussing and also, I thought, added to our stock of information; he certainly added to mine. I cannot fail to refer also to my hon. Friend the Member for Preston, North (Mr. Amery). Quite apart from the intrinsic merits of his speech, we were delighted to hear his father's son address us for the first time.
  I now turn to the Debate, and would begin by saying that I wish to raise two topics which have not yet been mentioned before I make one or two observations about the European scene. I desire to say a word or two about the speech of the Minister of State. That was also in a sense a maiden speech, as this was the first time he has spoken for the Foreign Office from that Box. I offer him both my sympathy and understanding. I know it is a most unenviable task to make one's first speech for the Foreign Office from that Box. I do not wish to criticise his speech but there were in it quite a lot of those old cliches that come trotting out. I know, because I have in my day used them an awful lot myself. But we have had almost more than our share tonight. I beg the Minister of State, before he comes to that Box the next time, just to dust them over a bit and see if some of them cannot be put back on those Foreign Office shelves where they really belong.
  I beg him also to try to avoid that catalogue of all the good deeds in which the Foreign Office is to be engaged in the next six weeks. Our Foreign Office people do work frightfully hard, but when he produced a list of the meetings that they are to attend I felt tempted to interrupt to ask him whether they were all home

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  fixtures or whether some were perhaps away fixtures. I think he should cut them out too next time and we shall listen with all the more pleasure to him discharging his difficult task.
  I do not intend to attempt to follow the Minister of State through the fields he traversed or to deal with the topics that have been dealt with by my right hon. Friend and others, such as O.E.E.C. and United Europe. I wish to put one or two points to the Foreign Secretary before mentioning the European scene. The first is a relatively minor one, but not, I think, altogether unimportant. I should like him to tell us, if he can, something of what is to be the future of the organisation we used to know as the I.R.O.—the International Refugee Organisation. I think the position was that last October the General Council of the I.R.O. decided that the organisation would go on for six or nine months after 30th June this year. Then I think last December a resolution was passed by the General Assembly for closing down the I.R.O. by 1st January next year. As I understand it, the work is to be taken over by a High Commissioner and there is to be an office in Geneva to handle these matters. I feel a little uneasy about this and I want to be reassured by the Foreign Secretary, if he can do it.
  There is possibly a greater need now for the work of an organisation like the I.R.O. than there was at the time of the cessation of hostilities. The problem is a human problem which is absolutely intractable by the ordinary Government means, and if the Foreign Secretary has any doubt as to whether this new organisation will adequately replace the excellent work being done by the I.R.O. now under Sir Arthur Rucker who is our chief representative, and others, I would suggest that he should not hesitate to go to U.N.O. and seek to extend the life of this organisation; if he thinks that the work would be better done in that way, than by some new organisation, the details of which are not known to us. At any rate, I would submit that for his consideration.
  Now I turn to another topic which has not been mentioned today at all. At this late hour it is not easy to find new topics; but this is a new one to which I do attach importance, and I hope that the House will also. Can we be given by the Foreign
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  Secretary any information as to what is now going on in respect of the Haifa oil refineries? We have seen a number of reports in the Press, but we have not had any information in the House, except what the right hon. Gentleman told my hon. Friend the Member for Paddington, South (Mr. De Chair) on 20th March last. I have here a cutting from the "Manchester Guardian" in a message from Cairo dated 12th February—while we were very vigorously occupied elsewhere. It quotes the Egyptian newspaper, "A1 Balagh" which published what it called the text of a conversation between the right hon. Gentleman and Nahas Pasha, the Egyptian Prime Minister.
  I am not suggesting for a moment that that text is what passed between the right hon. Gentleman and the Prime Minister of Egypt. I have had enough experience of quotations from various newspapers foreign and domestic, not to attempt to do that. But according to that report it is alleged that the Prime Minister of Egypt refused categorically to allow the passage of crude oil through the Suez Canal to Haifa, "either at present or in the future." I do not know whether that report is correct or not. I hope it is not; in fact I expect it is not. But I hope that the Foreign Secretary will be able to give us some information on the matter.
  It must appear to any outside observer that the present position in respect of the Haifa refineries is unfortunate from every point of view, and from the standpoint of every single country interested in the matter at all. So far as we are concerned in this country, the fact that the refineries are not working is, I think I am right in saying, costing us about 50 million dollars a year, which is a great deal more than the £17 million sterling which is its strict equivalent. It must be costing Iraq a great deal too in royalties and revenue and it must also be costing Israel a great deal. It is a thoroughly unsatisfactory business all round.
  I think I am right in saying that in the spring of last year armistices were signed between Israel and the Arab States, with one exception, which was Iraq. Cannot something be done to bring about an armistice between Iraq and Palestine? Cannot the right hon. Gentleman offer his good offices, with others if he wishes, though I think his own would be sufficient? He should try him-

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  self. What advantage can this situation be to anybody? It is just one where I should have thought that a quiet diplomatic effort might produce results.
  After all, last August the United Nations lifted the embargo on the supply of arms to these Middle Eastern countries. At that time, His Majesty's Government expressed the hope that freedom of passage through the Suez Canal would be restored. I must say that I think that was a very modest hope. It was one that was fully entitled to be fulfilled, because freedom of passage through the Canal is certainly implicit in, and even guaranteed by, the Suez Canal Convention of 1888, of which I have a note here. The terms of Article IV of that Convention are quite clear. In fact, I think I must inflict them upon the House. It says:
  "The Maritime Canal remaining open in time of war as a free passage, even to the ships of war of belligerents, according to the terms of Article I of the present Treaty, the High Contracting Parties agree that no right of war, no act of hostility, nor any act having for its object to obstruct the free navigation of the Canal, shall be committed in the Canal and its ports of access, as well as within a radius of three marine miles from those ports even though the Ottoman Empire …"
  as it was then—
  "… should be one of the belligerent Powers."
  I think I am right in saying that during the war, in 1940, neutral shipping did go through the Canal with lights on and unimpeded.
  I mentioned to the right hon. Gentleman that I should raise this topic, because it seems to me that the Egyptian Government have not any justification in international law for denying to our ships, or indeed to any ships, passage through the Canal. There was under the Covenant of the League a proviso, I think under Article 20, by which the League could take a decision to override all other international agreements. There is a similar proviso in the Charter of the United Nations, as the Prime Minister will remember—he and I had something to do with that. I think it is Article 103. As far as I know, none of these provisos have been invoked in this case. Therefore, the existing instrument—the Article to which I have referred—stands.
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  I am sorry to deal with this matter at a little length, but it is of importance not only in this case but as a principle for the future of this international highway. The Egyptian case is, I think, that they are not interfering with the ships in the Canal itself, but they are exercising their rights of control in the territorial waters at either end of the Canal, at Port Said and Suez Bay. If so, I would point out that that is precisely what the Convention says they should not do. It says that they should not interfere with the ships at ports at either end of the Canal or within three miles of those ports. Therefore, in the light of the armistice signed between Israel and Egypt, this tension should be brought to an end. I suggest that this state of affairs should not continue.
  Nahas Pasha, the present Prime Minister of Egypt, who is known personally to many of us in this House, has shown himself in the past to be a statesman of wise and sagacious views. It was my privilege to sign the Egyptian Treaty with him in 1936 and he was, let me add, a very loyal friend and ally in the darkest days of the war. I remember being severely criticised in this House for exchanging messages with him of a reasonably optimistic character when the war was going not very well, though what sort of messages it was thought that we should exchange with each other at that time, I am sure I do not know. I cannot help feeling that statesmanship here ought to be able to find ways and means of dealing with this situation.
  There is no doubt at all about what is happening as a result of all this. All of us who are interested in one way or another—Britain, Iraq, Israel, the Canal for the dues they get, the United States for their share—all of us are financially and economically losing by the present state of affairs. We are all getting poorer as a result. We hear a good deal, I think rightly, of the need to build up the financial strength, the economic life, of these countries of the Middle East. I agree with all that. It is the only way in which they can withstand the Communist menace. Here, we have a situation which is impoverishing all these countries to the advantage of nobody at all, and I really think that it is a task which a determined effort of diplomacy should try to resolve. I hope the Foreign Secretary will see his way to making the

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  effort to do that, and I would add that if we can be of any assistance to him we shall be only too glad to help.
  I want to turn from that to the European scene. I have been privileged, in the years during which I have been a Member of this House, to listen to a great many speeches by my right hon. Friend the Leader of the Opposition, and I must tell him that there has been none which has impressed me more than the one he delivered today. I would say that, by its scope and grandeur, its touch and temper, which kept it so closely attuned to the needs of the hour, it was world statesmanship at its very highest level.
  We have had a great deal of discussion today about the German problem, and it is that subject on which I want to say something. I do so with some diffidence, because it is a topic about which I find it extremely difficult to be dogmatic. All my political life, and some of my life before that period, like that of the Prime Minister, was mixed up with this German business, and I suppose that I have had as much direct negotiation with German representatives as anybody in this House today. So I feel that I have a responsibility to try to contribute something, but I do not find it easy.
  I have this conviction with which I start. It must always be wrong to found a foreign policy on the basis of prejudice, or of personal dislike or of past hatreds. That must be wrong. If we are to make our contribution to peace, as we are in honour bound to try to do, we must approach it objectively, putting aside all personal feelings. I am convinced that that is what the British people really want to do. In spite of all that has happened at least twice in our generation, in spite of all the suffering which was so widespread throughout this land and throughout other lands, I believe the people of Britain none the less ardently wish to live and let live. But how very difficult it is to achieve that. We have only to listen to this Debate today, to the variety of speeches and the difference of outlook, in order to understand that.
  My earliest initiation into international politics came to me in Geneva very shortly after the Locarno Treaties had been signed. I suppose that was the heyday of the League of Nations, when Sir
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  Austen Chamberlain, M. Briand and Herr Stresemann were meeting in 1926 and 1927, not only in public sessions of the Council, but privately and frequently, in trying to resolve the problems of the day. They did resolve some of them but not all, and the feeling which I certainly had, and I know Sir Austen Chamberlain had it too, was that at last we had found international machinery for settling disputes which had hitherto baffled diplomacy, and, in the process, we had perhaps also found a way of solving the age-long problem of the quarrels between Teuton and Gaul.
  Unhappily, those hopes were not fulfilled. Broadly, I have felt in all my dealings with German representatives through so many years, that there are two stubborn impediments which hamper and can prevent the smooth working of our relationship, and I think these ought to be stated. At least, I think I ought to state what I found. Neither of them is insuperable, but I do not think we shall get on any better by pretending that they are not there.
  The first is that Germany has had very little experience of the working of the democratic machine as we in the British Commonwealth and our neighbours on the Continent understand it, and as the United States understand it. In that sense—and I say this with no desire to cause offence—the Germans as a people have not had the same active, direct political experience that our own people have had. We come up against that all the time in our discussions and negotiations. There is a passage somewhere—I tried to find it but could not—in Von Billow's Memoirs—I remember the passage, but I cannot find the quotation—in which he frankly admits this shortcoming among his own people, and talks of the British as the most politically conscious people in the world. I do not know whether we are that or not; we may or may not be, but at least our Parliamentary system and all that it stands for is an integral part of our lives. The growth of such a consciousness in the German people must take time. It is no good our expecting it to flourish overnight because we sincerely wish it to do so. Even sincere German democrats, of whom there are many, are wise enough to admit that the process must take time.

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  I remember discussing in Berlin shortly after the war—the right hon. Gentleman will probably remember the occasion—with a lot of young Germans their views about the future of Germany. They were intelligent and thoughtful young men, and at their request I tried to explain to them what we meant by the Parliamentary system, by political parties, and so forth. I do not flatter myself that I made much impact on their minds. They were still thinking in terms of a National Youth Movement and it was almost inevitable that they should have been doing so. After all, their thoughts and minds had been trained that way, and that is not going to change in a year or two. But we must change it, because there is really no other way in which to build the foundations of peace in Europe. Incidentally, I may say that apart from the pleasure of meeting those young Germans and talking with them, one thing came out of the conversation which rather pleased me. One of them said afterwards to a friend of mine, "Well, anyhow, Ribbentrop would never have come and met us like that." I thought, perhaps, there was a little hope in that observation.
  There is another difficulty, which is an obstinate one, in assessing the German problem. I can never altogether escape the feeling that in the minds of many Germans there is a desire, or at any rate a tendency, to believe that the Germans have some special mission with regard to the rest of Europe, a mission which, in the minds of some at least, is coupled with leadership, which, in fact, means the domination of their neighbours. In the same way, while there was no doubt opposition to the Nazi régime, which profoundly shocked many Germans, the expansionist spirit which informed it did give expression to something in their character, and we should be wise to recognise that fact.
  I say those things because I think we should have them in mind, but that does not mean that we ought not to go on trying for a reconciliation and for development of relations, as my right hon. Friend said, on the basis of the most intimate confidence between France and ourselves, and on that basis try to find a true friendship with Germany. But it is right that we should
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  recognise how formidable are the difficulties.
  It seems to me that the lesson of this Debate is that we have to go on working steadily, trying to bring Western Germany more and more into association with her western neighbours. The more closely that we and Western Europe can be associated, the better is the chance that Germany will find her level with her neighbours. Of this at least I am certain: there can be no enduring settlement of European problems unless our country plays its part in guidance and in leadership. There is no future for the Continent of Europe without British leadership and participation.
  It seems to me that in these post-war years the political leaders of France have more than once shown real statesmanship in their endeavours to improve relations with their German neighbours. France is convinced, and we think rightly convinced, that this can only be done successfully on the basis of her unity with us and our joint friendship with the United States of America. We agree. Her statesmen have certainly shown neither resentment nor bitterness for the years they endured. I read Mr. Schumann's speech, to which reference has been made in this Debate. I thought it was instinct with statesmanship and perhaps in contrast with some of the things we have read in years gone by from France. The mood of France today is that of a country trying to find logical arguments to sustain an instinctive wish to improve relations on either side of the Rhine. That is very remarkable and very encouraging.
  I say to the Foreign Secretary that everybody has tried to make constructive contributions to this Debate, and I would conclude by simply putting to him briefly six short points which I suggest might be the main objectives of our foreign policy. The first is, as my right hon. Friend the Member for Woodford said, that on the basis of deep and intimate friendship with France and our Western allies of the Atlantic Pact we should work for closer relationships with Germany.
  The second is to accept that defence is the sphere in which integration of effort and organisation by the Atlantic Powers should afford the fewest obstacles and that every attempt, therefore, should be made, and made now, to press on so that, as early as possible, there may be a

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  Western European military force. Really, that should have been there long ago. It is absolutely indispensable that it should be created now because it is on that basis that further development must be considered.
  Thirdly, I submit that the cold war can only be viewed as a world problem. It is impossible to deal with it in separate watertight compartments. If the threat must be met in Western Europe now, it must equally be met in South-East Asia; and it must be met by positive statements of our own views and way of life rather than by mere denial of Communist views. I am convinced there is room for effort and co-ordination with our allies here.
  Fourthly, that the Spender Plan should form the basis of our action in the Continent of Asia. This means hard effort. It means an endeavour to promote stable Governments in those countries and not merely to pay millions of money which, without stable internal conditions, have very little effect at all. We are heartened by Mr. Acheson's offer of co-operation with the Spender proposals. That ought to be welcomed, and I hope the Government will send a strong delegation to Sydney. I know the difficulties of the Parliamentary situation. I do not know if my right hon. Friend the Member for Woodford would agree that the usual channels might do something or not. I say nothing against the particular individual chosen, but I did note he belonged to another place. I thought that might not be entirely unconnected with the state of the parties in this House. We must not allow that effort to lag through lack of strong representation.
  Fifthly, if release of any part of the sterling balances is to be regarded as part of this endeavour, as the hon. Gentleman the Member for Coventry, East (Mi. Crossman) said the other day, that ought to be clearly stated and agreed, and the contribution of all the nations towards economic stability in Asia ought to be appraised and measured accordingly.
  Sixthly, and finally, the purpose of all this endeavour ought to be to strengthen the economic fabric and free way of life of all nations determined not to fall under the Communist rule. Once this his been achieved, it should be possible to negotiate with Moscow on a basis of strength,
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  and no method of negotiation ought to be excluded.
  Here, at least, for what they are worth, are the outlines of a policy. I offer them constructively to the right hon. Gentleman in the same spirit and temper as my right hon. Friend did so much more eloquently in his own speech this afternoon. Whether they will be of any avail or not, I cannot tell; but of this I am sure—the time has come for a clear exposition of where this country stands in foreign policy. That is due not only to ourselves but to the world which waits so anxiously for our lead.
  10.31 p.m.
  The Secretary of State for Foreign Affairs (Mr. Ernest Bevin): Like the right hon. Member for Warwick and Leamington (Mr. Eden), I am grateful to the House for the temper and tone of the contribution it has made to the great and perplexing problem of handling world affairs. In the closing phrase of his speech, the right hon. Gentleman said the time had come when we should declare—and I notice it was "we" should declare—our policy. I presume he meant "we" as a country. I hope to show that the day when we, as Great Britain, can declare a policy independently of our allies and colleagues has gone. In evolving the methods of dealing with these tremendous problems in this small world, small but dangerous, and in making declarations of policy, we must know to what extent we have the support of all those who have joined together with us and to what extent we all have a cohesive policy. The right hon. Gentleman set down six points, with which I have no quarrel. In fact, after I left the Foreign Office tonight, he must have been round working on the files, because he summarised very well what I have been trying to do in the last 4½ years. I have no quarrel with anyone who supports that policy.
  I worked with the right hon. Gentleman very closely in the Coalition Government, I think he will agree, and together we evolved a good deal of the basis of the policy we have followed since. The whole course a country is taking in foreign policy cannot suddenly be altered by a General Election. Geography remains the same; the facts remain the same, stubborn as they are. In the discussions which took place before my right hon.

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  Friend the Prime Minister joined the delegates at San Francisco, many things were discussed, evolved and agreed. With the backing of the Government that had been elected and with which I have had the honour to be associated, I have tried, as an individual, to carry out that policy. Looking back, I think I was right to hang on to that policy to the last possible moment.
  I did not despair despite all the frustrations and difficulties. I believe the peoples of the world would have been disappointed, would have misunderstood, and we might have had catastrophic happenings in the world, if we had not tried, to the best of our ability, and to the last possible moment, to work through the United Nations and the Council of Foreign Ministers. It was only when we were absolutely convinced that that was not going to work, that it was going to be frustrated at every meeting, that we had to turn to another course.
  Turning to this other course has not been easy. In speeches to which I have listened, it is sometimes assumed that all that has to be done is for Great Britain to turn. I must be extremely careful in what I say, for the relations with our friend and allies have been good, yet at the same time Parliaments and Congresses enter into these discussions with such rapidity that even a wrong word or thought can cause trouble at this stage. This is particularly true of the United States. I am convinced that if we had attempted to construct the Atlantic Pact even weeks before we did, we should have failed. I believe that there would have been such alarm in the United States, where isolationism is still strong, if the situation that did develop with Russia had not been understood completely, that the excitement which would have followed would have been such that there might have been failure.
  In handling this job—and I am sure the right hon. Gentleman will agree—there is one thing which is important, and that is the matter of timing. It is the timing of an event that can result in its success or its failure. If there was a miscalculation, tremendous opposition might have been caused, which otherwise might
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  have been avoided. What we have done—and it is one of the six points which the right hon. Gentleman mentioned, so I do not know why we have been asked to do it—is to attempt not only the unity of Western Europe but the unity of the Western world. I think I might have had a little tribute for the work I have done in this matter. I am sure that, wile there is talk of integration in Western Europe, Western Europe will not be strong enough in itself: it is the integration of the Western world that will give the strength and power necessary to defend ourselves. Europe has so torn itself to pieces with the catastrophic wars in which it has indulged in the last 30-odd years that it is going to take a long time to arm it again and pull it together, and to develop it economically. While His Majesty's Government promoted the unity of Western Europe which, as I said at the time, was the hard core which could be brought together to enable us to do something to create character, we had, at the same time, to try to develop this wider unity.
  That brings me to the point about which I have been asked a great deal—the Assembly. I must answer some of the points about this, so I cannot follow the general discussion further at this moment, but I will try to make some reference to it later. The right hon. Member for Woodford (Mr. Churchill), I think, said the Ministers seemed to be acting so cautiously that they stand in the way of the Assembly. I have known Governments in this country, of which he has been a member, which have even had to stand up against the enthusiasm of the House of Commons. There may be resolutions carried in an Assembly without any details worked out, or without assessment of the responsibilities involved, which cannot be applied without very grave consideration.
  For instance, I go to Strasbourg tomorrow. One of the proposals to be discussed is something which I am quite certain that this Parliament and this country could not accept—and, indeed, the right hon. Gentleman himself discarded it—but which has been put forward by other countries. It is that we virtually create an executive body in Europe which, though not elected by the people, not even elected by Parliament, can by a majority in a very small group

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  arrive at decisions which, by means of a simple majority, can be imposed upon a State. Supposing I agreed to a thing like that on behalf of the Government; this Parliament would not stand for it for one moment, but because I go there and say, "Really, gentlemen, this is not the way to do it," I am accused of dragging my feet.
  What there has been in this European movement is a little bit too much of the oppositional complex, trying to translate into Europe the oppositional complex which we get in our own Parliaments. Does the right hon. Member for Bromley (Mr. H. Macmillan) want to interrupt?
  Mr. Harold Macmillan: I am unwilling to interrupt the right hon. Gentleman, but if he is relating his observations to the suggestions about the Executive Committee which were put forward by the General Affairs Committee, which met last week, I would point out that it was a unanimous agreement of that Committee and that the Minister of Town and Country Planning was one of the unanimous voters, with me.
  Mr. Bevin: I have not seen those documents. I was dealing with a document which has been circulated by the Secretariat.
  Mr. Macmillan: That is the document.
  Mr. Bevin: I will not enter into an argument now, but if a Minister happens to be a member of that body that does not commit the Government.—[HON. MEMBERS: "What?"]—People are going to that Assembly as individuals. Let us have an understanding. They are there to express their views, but they are not committing their Governments. That is the answer, and I cannot accept, whoever goes and expresses a unanimous opinion, that that, of itself, commits the Government. We have the responsibility of looking after the affairs of our country, and I was speaking in that sense. I am not criticising this decision at all. What I am pointing out, when the Ministers approach the problem, is that the Committee on General Affairs might approach the problem in a spirit of enthusiasm, but the Committee of Ministers must approach it in the spirit of the constitution, responsibility to Parliaments and of all other considerations. What we try to do is to bring a balanced judgment to bear on all these problems.
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  There has been a problem, so it is alleged, between the Ministers and the Assembly over the procedure. I am afraid I am not very good at procedure, but I do not believe myself that it is wise at this stage to begin writing a lengthy constitution. I say that we have to try to proceed in Europe by trial and error. My proposal has been—and I stand by it—that if there is difficulty between the Assembly and the Ministers, I am quite willing to see carried out the practice which has been general in all Assemblies of that character—that there should be general discussion between a Committee of both sections in order to adjust on its merits the matter which is in dispute, but not to try to write out a whole code of procedure to meet every possible thing that might happen. If we do that. I am sure that we shall not make any progress.
  It has been suggested that we have been slow. Well, I am told that I must not say anything about the Foreign Office; but I must take the credit that the bulk of the constructive work was actually done in the Foreign Office here. We did work jolly hard to put forward the scheme, and, what is more important, we got the European countries to agree. That, at least, ought to be said to our credit. I get a good deal of talk from the United States, but, then, we are not integrating the United States with Europe. I wonder what sort of arguments I should get if the United States were in the Council of Europe and I was trying to put something over on their constitution. I am afraid there would be some very strong arguments that would develop.
  The most important thing that has been raised is the accession to the Council of Europe of Germany. It is very difficult in a few moments to deal with a problem of this magnitude. I have no prejudice against Germany. I do not like what they have done in two wars, but does anyone? It is a little difficult sometimes to put this feeling on one side. On the other hand, we must not allow ourselves to forget the character of the people we are dealing with. That is vital. There has been trouble arising recently about the accession of Germany to the Council of Europe, and so far as we are concerned, we take this line. We are going to try to avoid what happened at the League of Nations, in which there

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  was a lot of courting of Germany to get them in. I am not complaining of that. People thought that it was a great thing to get Germany. Then afterwards there were the various attitudes adopted by Germany, which amounted to treatment of the League which, to put it at its best, was not courteous or decent to the rest of the people who were trying to work with them.
  Mr. Churchill: The Hitler revolution had taken place.
  Mr. Bevis: The Hitler revolution did not change the German character very much. It expressed it.
  Mr. Churchill: No.
  Mr. Bevin: That is what it did. It was latent there right from Bismarckian days. I had to deal with them as well as the right hon. Gentleman. I had to deal with them as employers and in shipping, and in many other things where I got into close contact with these gentlemen.
  On the basis of the Occupation Statute, I do not think it is right for a nation like Germany to begin arguing with us about the terms on which she will come into the Council of Europe. What I do say is that if they come in and wholeheartedly accept, we on our part will accept them as an act of faith and not delay too long in getting to the next stage. What is the next stage? Under the Occupation Statute, one of the problems is dealing with their foreign policy. We shall have at some time, I presume, to take a decision, the occupying Powers I mean, as to whether we will hand the conduct of foreign policy back to Germany. It is only at that stage that she can act as an equal in the Committee of Ministers. I am not prepared, and I do not think the Cabinet would be prepared, to violate that by hybrid arrangements. We think it is too dangerous.
  We have in the course of dealing with Germany made much greater progress, although she is divided due to Russian action, than was made at the end of the 1914–18 war, but on rather different lines. We have been trying to build up a sense of democratic responsibilities. I assure the House that it is frightfully difficult. I have to tell my Socialist colleagues
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  in Germany very often that they are a little bit too nationalist for me and that their nationalism breaks through their ideas of social democracy rather too frequently to make me feel comfortable in arriving at decisions in dealing with them All that means caution.
  I was asked about the progress in dealing with human rights. This has been referred to the jurists. They have examined the question in the light of the United Nations draft charter. They have made their report. I have not yet received it, but as soon as His Majesty's Government receive it, we will try to come to a decision on the whole matter.
  I have been asked to submit that the whole purpose of our policy should be the winning of Germany for the West. This raises the question of the arming of Germany. All of us are against it. I repeat, all of us are against it. It is a frightful decision to take. As I understood the right hon. Gentleman who opened the Debate, the situation he had in his mind was something like this. I hope I am not going to misrepresent him. It was that we should get Germany and France to come together, and that we should now begin discussing the arming of Germany. I can only suggest that if I went to Strasbourg or Paris with that proposal, I am afraid that the bringing of France and Germany together would be set back for a very long time.
  Then we are to use this force when we have armed it, to defend ourselves against Russia. Well, there are such things as preventive wars. The Continent is in a very derelict state and as I understood the position of the Fulton speech, it was a preventive war which the right hon. Gentleman had in his mind. [HON. MEMBERS: "No."] Preventive action, shall I say, before the war was developed. [Interruption.] I have listened all day, and now hon. Members must listen to me. We then go to Russia and we propose to discuss matters with them with Germany, armed by us, on our hands. I suggest that handling Europe in that way is not wise and not good, and will not produce the desired result. Therefore, I must say to the right hon. Gentleman that we have set our face—the United States, France and ourselves—against the re-arming of Germany, and that, I am afraid, we must adhere to. We have at the same time—
  Mr. Churchill: I never used the expression "re-arming" or "the re-armament of Germany."
  Mr. Bevin: It may not be the rearming of Germany, but if we give the Germans arms we are re-arming them.
  Mr. Churchill: What I suggested is that Germany should make a contribution to the aid of European defence. There should be Germans serving with us and the Americans and the French on honourable terms.
  Mr. Bevin: I am sorry if I misunderstood the right hon. Gentleman, but that was what I understood him to say. I should be very sorry to misrepresent him in any way, but I think that I was interpreting him correctly.
  If we want to bring France and Germany together, talking about arming Germany in any form is, I am satisfied, going to set the clock back for a considerable time. I talk with my French colleagues about the great problems with which we have to deal. Like the last speaker, I pay tribute to French statesmanship in the tremendous task which they have undertaken in trying to solve the various problems which now face us. But I am not going to take a step which is going to set the clock back—which would make things very bitter and very difficult to solve.
  The other question put to me concerned the International Refugee Organisation. We, with others, have brought this costly operation to a close. It was costing 150 million dollars a year, and we were not the only Government which was feeling the burden. The right hon. Gentleman the Member for Warwick and Leamington is quite right when he says that the main operation in connection with the refugees is to close on 30th June, but the shipping facilities are to be continued until March, 1951, for the benefit of all displaced persons who have the chance of going overseas. This country's contribution has been outstanding in regard both to the proportion contributed to the expenses of the International Refugee Organisation and to numbers, over 80,000 refugees having been accepted in this country, excluding Polish resettlers. I think that is a magnificent contribution to solving this problem. It may be possible still to bring a few more, but housing and other difficult-
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  ties have to be considered. The International Refugee Organisation has resettled nearly 800,000 people. There are about 150,000 people left to be settled.
  We take the view that this is a problem to the settlement of which Germany must make a contribution. This is the hard core. Germany created the problem through the war and, according to the discussions which have gone on with the German Government, they think we are quite right in doing what we have done. Our High Commissioner has reserved powers for dealing with this matter. It is true that the United Nations are about to create a High Commissioner for Refugees to advise member Governments. But the decision which has been taken was, I think, perfectly justifiable, and was one to which we ought to adhere. I believe we will dispose of the remaining hard core in that way better than by trying to dispose of it by continuing the life of the International Refugee Organisation.
  The other point which the right hon. Gentleman raised was with regard to Haifa. This matter was not quite so simple as the right hon. Gentleman suggested. This place was allocated to the Arabs under the United Nations resolution. Israel did not accept that point. She proceeded to take it, and Iraq then cut off the oil.* Since that time, we have used all the diplomatic pressure that we could to get Iraq to open this pipe-line and to allow the oil to flow. But Iraq is a sovereign and independent State. I suppose she has a right to come to her own conclusions on this matter as an independent State, and she absolutely declines to allow, in the face of her public opinion, this oil to flow.
  That raises the question whether oil should come through the Suez Canal, While I was in Egypt, I was instructed to raise this question with Nahas Pasha. He argued cogently and legally, as did the right hon. Gentleman the other way today, in view of the state of war still existing between the Arabs and the Israelis, and he absolutely declined to yield on that point. The matter is still being pursued and will be pursued until we get a solution. But one handicap in dealing with the Israeli business is that practically none of the United Nations resolutions has been accepted by Israel.
  * See Column 870, lines 30 to 53.

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  The difficulty that other countries find, not only us but the United States as well, is that when the problem of Israel has to be dealt with in relation to other States, then there is no basis upon which we can work. We have had a very striking illustration of that in connection with Jerusalem, where the decisions have created enormous prejudice and difficulty in the Middle East. The other thing associated with it is that, like the rest of us, I suppose, Iraq has her comrades in the Arab world and one of the difficulties is that none of them will be accused of letting down the other. That is not a bad trait. I grew up in a school that rather practised things like that, I am afraid, and therefore I can quite understand their feelings on this matter.
  Mr. Eden: That is exactly why I am suggesting we should try to make them all do it together. On the Canal, surely, the position is quite clear from the Convention, whether there is peace or war; there really is no right to stop ships going through.
  Mr. Bevin: I must say in fairness to the Egyptians that that legal right is disputed. I dare say one can get an advisory opinion from the courts as to the position. The Egyptians dispute that thesis and argue very cogently the other way, but I am not going to go into this tonight at this hour.
  Mr. Keeling: The right hon. Gentleman says that Iraq is a sovereign country, but as Iraq made a contract with a British company that it would allow that British company's oil to be exported, either through the British company's own pipe-line or by sea, is he not going to support the rights of that British company?
  Mr. Bevin: I do not really know what the hon. Gentleman is referring to. I do not know all these contracts.
  Mr. Keeling: The Iraq Petroleum Company's contract.
  Mr. Bevin: It is just the very point that the right hon. Gentleman made that I have been trying to do—to get them to act together and give way together, so
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  that the thing can be settled. I am afraid that is an almost impossible task and it is not likely to be achieved. Therefore we are pursuing the matter, I can assure him, and will continue to do so.
  The other point raised was the question of the hydrogen bomb. I have been asked both now and at Question Time before today to say something about the hydrogen bomb tonight, in reply to the Debate. The hydrogen bomb is an even more fearful prospect than the present atomic bomb, but in my view it does not change the essence of the problem at all. There can be no safety unless we can secure a rigorous system of international inspection and control. That is the real point upon which the difference of opinion exists and we have taken it to the United Nations.
  The majority of the United Nations came to a decision that the Soviet Union has rejected. The proposals which were evolved by the United Nations Commission were unacceptable and Mr. Gromyko submitted counter-proposals, and they were considered by the United Nations. They came to this conclusion—that this would increase the danger rather than alleviate it. It might delude the people of the world into believing that atomic energy was controlled when, in fact, it was not. Therefore, we have pursued this business of trying to get the matter dealt with by reaching agreement with the United Nations.
  There is a Committee of Six which has been instructed to continue with their work, but in fact the work was interrupted owing to the quarrel which arose over the recognition of China, which had nothing to do with the atomic bomb at all. Therefore, as soon as we can, we shall be willing to begin discussions and attempt to make agreements, but it is a very risky business when dealing with weapons like the atomic bomb to enter into commitments of any kind unless the daylight is let in and every nation is willing to show exactly what she is doing about the matter—otherwise any one country may be held to ransom at any moment. That is the great problem that has to be solved. The view of the majority, therefore, is that there must be a permanent control and that this can only be achieved by the operation and management by an international control agency

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  of all the processes leading up to the final process by which the nuclear fuel is produced.
  It has been argued that because gas was outlawed—it was not used in the last war—that it was stopped by convention. I have very grave doubts about that. I remember the communication from Generalissimo Stalin to the right hon. Gentleman when Stalin was afraid that gas was going to be used against the Soviet Union. It was arranged that a statement on behalf of the British Government should be made on the radio, telling Hitler what he would get if he dared to use it.
  I never felt, knowing that the gas was there, that the Convention itself was any security against its being used. It was only a strategic decision as to whether it paid one to use it. But really I think the last war determined the issue, and that experience had a great influence on my mind in coming to a decision in the case of atomic energy. I do not think the House would wish us to come to a conclusion which would leave any risk so far as this country and the Western world is concerned in regard to the control of atomic energy.
  I hate, in conclusion, to refer to any more meetings because it may give the right hon. Gentleman another sleepless night, but these things have to be continuously discussed. The problem of Germany, the problem of Asia, the problem of the Middle East we all endure, and we cannot move alone. We must move together, and therefore I have taken steps within the last few days to suggest to Mr. Dean Acheson, whose speeches have been so well mentioned in this House today—which I am sure he will appreciate—and who has a tremendous task with great difficulties to overcome, that I thought the time had come when there should be another meeting of the Council of the Atlantic Pact, this time in London. He is summoning that meeting, which will be held here on 9th May, at which many problems affecting ourselves will be discussed. I had better put it as it has been agreed with the United States or I shall perhaps cause trouble.
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  The communiqué that has been issued is that we have invited Mr. Acheson to convene the North Atlantic Council, the highest organ of the North Atlantic Treaty, in the first half of May. Mr. Acheson has transmitted this invitation to the other Governments concerned, and they are now considering it. I have suggested to Mr. Acheson and to Mr. Schuman that we should take the opportunity of this meeting to hold discussions between ourselves, and they have both welcomed this proposal. We have moved along since our last meeting in Washington. We have had our meetings in Paris, at which we dealt with the German problem and we meet on 9th May to deal with the tremendous issues arising under the Atlantic Paot. Before that meeting takes place there will be meetings of the Finance Ministers, meetings of the Defence Ministers, and what is more important in connection with the Atlantic Pact there is a growing desire not merely to deal with the defence problem, but to operate Article II which involves economic and political problems as well. It encourages one to see that while the original concept was that of defence against aggression, now we are turning to a constructive concept dealing with economic development at the same time.
  I hope and trust that before long, instead of aid from America in the way we have known and instead of pressure upon us to integrate, we shall evolve in such a way that the wider integration will take place. Western civilisation is worth saving. Western civilisation is a thing that must be saved, and the only way to do it in my view is to hold not merely the Western world which is the key to its salvation but the Eastern world as well, and to develop the great power and potentiality of the West. If that combination grows, I visualise a long peace. I beg of the House, and the country, not to despair because of present circumstances. I think the day is not far distant when the growth of this power, which has been divided and separated so much in the past, the growth of this unity, not so much union, unity of spirit, unity of action and the comradeship between us, will create a situation that will leave no alternative but to negotiate to settle once and for all this problem that has cursed the world for so long.
  11.15 p.m.
  Mr. J. Langford-Holt: I apologise for keeping the House at this late hour, but not for focusing attention on a topic in the European circle which has been largely neglected in this Debate today. I do not intend to go through the long history of the affairs of Austria. After the First World War under the Treaty of St. Germain, Austria was left as a small nation of 6,500,000 people, of whom 2,000,000 lived in Vienna. The result of this was that Austria was left in a state of economic instability such as it had never known before. During the years between the wars Austria made efforts to try and revive itself. These unsuccessful efforts resulted in the anschluss of 1938. The same conditions which brought that event about can, and may, exist in the event of an evacuation by the occupation troops in Austria today.
  At the Moscow Conference in 1943 a decision was taken, quite rightly, that Austria should be "re-established as a sovereign State." But Austria today still has, in fact, if not in theory, the status of an enemy-occupied territory. It is true that the right hon. Gentleman has been trying to negotiate with Russia and the other occupying Powers, and a peace treaty was held up a year ago by many grave and growing difficulties—such things as the German assets, and, of course, the claims of Yugoslavia. I think the right hon. Gentleman and the Minister of State would do well to consider, as they must have done, why the Russians today do not wish to conclude a peace treaty with Austria.
  We have to consider in this context the use that the Russians have made of occupations wherever they have enforced them. They have used these occupations to bring into being strong Communist parties, which could take over the Ministries of the Interior and the police, so that when the Russian troops left the political position would not be materially altered. Last summer it appeared that the Russians were prepared to some extent to consider a peace treaty with Austria, as a result of a sense of political security in Hungary and other Eastern European countries and advances were made along that road. But, at the same time, something else happened—the situation which the Russians had considered in
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  Yugoslavia to be becoming increasingly favourable to the Cominform changed. The Russians felt that in Yugoslavia they would succeed in undermining the position of Marshal Tito, but that did not come off.
  I believe that the reason why the Russians remain in Austria today is not any consideration of the security of the lines of communication through Hungary or any other Eastern European State but because Communist panties in those countries have assured that. Because of that failure in Yugoslavia the Russians are trying to do today what Hitler did when he invaded Austria. He invaded Austria for two purposes. There was the ethnological reason that he wanted to bring Austria "back into Germany," as he called it, and there was the strategic reason. I believe that to-day the Russians have that same strategic objective. Through Yugoslavia, Bulgaria, Roumania, Hungary and Austria, they want to keep pressure on Tito as hard and as long as they can. They are reluctant to make it easier either for Yugoslavia or for ourselves. When they look around the world and see the success which Communism has had in the Far East, they are reluctant to make the position any easier for us either in Austria or anywhere else where the initiative is still in their hands.
  What is the effect of this continued occupation of Austria? Austrian economy has been smothered for five years, on the one hand, and, on the other, propped up by gifts and loans from ourselves, from the United States and through U.N.R.R.A. and other agencies. There is also the psychological effect of five years' occupation. We find, in Austria today, that feeling of exasperation and apathy one might well expect to see after a long and burdensome occupation. I was interested in the expressive metaphor which Dr. Renner used when describing the occupation. He said that Austria hoped dearly that the four elephants would get out of the rowing boat. That is the feeling which Austrians have about the occupation. In saying that the four elephants should get out of the boat, it would be wrong to suggest that it would be right and proper for three elephants to leave the boat if the fourth were to remain at the tiller. Nobody outside a lunatic asylum, or outside the Communist Party, would

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  suggest that it would be right for the Western Powers to leave Austria and leave the Russians in sole occupation. The fourth effect of this occupation is one which I think Moscow would do well to note—the complete failure of the Communist Party in Austria wherever free elections have been held.
  What is the position as we find it today? I think the Russians are not staying in Austria for Austria itself. Let the Austrians take encouragement from that. They will go when the other conditions I have mentioned are more to their liking. I think that the Austrians feel a little uncertainty as to the political situation which has arisen in this country. They are not quite certain whether they would receive the same consideration from a Government formed from this side of the House as they may have received in the last four years, and I think that I would be quite right to say that the Austrians would receive from a Conservative administration no less sympathy and consideration than they have received from the party opposite.
  If this Debate is to be of any value at all it must be to make quite clear the Government's policy. Has the Foreign Secretary made up his mind clearly on this subject of Austria? The indications are that he has not. Has he decided whether Austria is to be allowed to go back into the condition it was in 1937 when an anschluss became possible, if not inevitable? Has he made up his mind whether Austria is to be part of a Danubian economic federation, or whether Austria, economically and politically, shall be integrated with Western Europe? It is our belief that the third course is the one which he should follow. We want Austria to join Western Europe willingly, and she can only do that willingly and effectively when the occupation has ceased and a peace treaty concluded.
  While we wish to end that occupation at the earliest opportunity, and while we as a nation wish to conclude a peace treaty with Austria at the earliest possible moment, we do not for one moment consider an evacuation, either unilaterally or bilaterally, by ourselves or our Allies so long as the Russian occupation troops remain in Austria.

  TRIBAL CHIEF, BECHUANALAND (RECOGNITION)
  11.28 p.m.
  Mr. Fenner Brockway: I should like to express regret to the Minister for Commonwealth Relations, to the Chair, and to the officials of this House, that we are continuing the Debate now, but I believe we shall be discussing an issue which is only second in importance to that which we have been discussing today. The world today is faced by division into two blocs which may, before many years have passed, bring war, but in the long run I believe there is a more fundamental issue even than that—the issue of which the Seretse Khama case is a symbol. It is an issue of the division of the world between the white and what are known as the coloured races. I believe that in seizing this first opportunity after the Minister for Commonwealth Relations made his statement on 8th March we are doing an essential service to this House and indeed to the ultimate peace of the world.
  When the case of Seretse Khama was first raised the Minister for Commonwealth Relations made it clear that the decision of the Government was not dependent upon its view of the colour bar. Nevertheless, I say that the colour bar is the real issue behind the decision to refuse to recognise Seretse Khama as Chief in Bechuanaland. I recognise that there are two aspects of the colour bar—that it is not only a matter of prejudice on the side of those who belong to the white races, but that there is also prejudice among older schools of thought among the black races. Indeed, if one turns to the White Paper one finds that the Government places greater emphasis upon the danger of the division of the tribes than it does upon the opposition of the whites in South Africa.
  So far as that is concerned, I believe that those who wish to see the influence of the colour bar ended in the world should welcome every tendency in the black races, as well as the white, to overcome that obstacle to human equality and that when, in these tribes in Bechuanaland, Seretse Khama was endorsed as Chief by a vote of over 5,000 to fewer than 50, that decision should have been welcomed by the House and by the Government as a great stepping stone in the advance towards

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  racial equality in the world. I suggest that what has happened since the decision of the Government, the unity which has been shown by this tribe in their championship of Seretse Khama, indicates a unity in the tribe which ought to be welcomed by the House and by all who believe in racial equality in the world.
  I want to put this specific question to the Minister. Since the White Paper places the greatest emphasis on the danger of disunity in the tribe, if progress is made in the coming months towards unity within the tribe by the reconciliation of Tshekedi and Seretse Khama, if steps are taken in the immediate months to disprove that there is a danger of disunity and disturbance in the tribe, will the Minister and the Government be prepared to reconsider their decision not to recognise Seretse Khama as Chief of this tribe? I put that question to the Minister in a serious way because I am aware of steps which are being taken in South Africa at this moment to bring about unity between Tshekedi and Seretse Khama.
  Mr. Beverley Baxter: Personally, I am in sympathy with the arguments of the hon. Member so far as he has gone, but in view of his plea for racial equality I should like to ask him the elementary question—does that include the recognition of marriage and the advisability of marriage between the white and the coloured races?
  Mr. Brockway: Certainly, as far as I am concerned. I believe in the absolute equality of white, brown, black and yellow. I do not believe that any Government has a right to interfere with intermarriages between races.
  Mr. Baxter: Is the hon. Member aware there is a saying that racial equality is a policy always put forward by a country which has no racial problems?
  Mr. Brockway: I am not thinking in terms of this nation. I am trying to think in terms of the world. If there is to be peace in the world, it must be on the basis of recognising every race, whatever its colour, as part of the great human family. If one accepts that principle, there must be no obstacle to marriage between the various sections of the human family.
  I want to turn now to the second aspect of this question. This aspect is dealt
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  with in only one paragraph in the White Paper—paragraph 17. It is the effect of the recognition of Seretse Khama, not so much upon divisions in the tribes as upon the whites living in South Africa and Rhodesia. The paragraph states:
  "His Majesty's Government were, of course, aware that a strong body of European opinion in southern Africa would be opposed to recognition; but, as stated in the House of Commons on the 8th March, no representations on this matter have been received from the Government of the Union of South Africa or Southern Rhodesia."
  I am prepared to accept that statement, but I should like to ask the Minister whether his attention has been drawn to the reports in South African papers, that Dr. Malan did send a telegram upon this matter, and whether he can make any statement about these reports. The paragraph continues:
  "In the view of His Majesty's Government the existence of this body of opinion is no reason why they should not refuse recognition on the quite different grounds stated in paragraph 19 below."
  I want to ask the Minister whether the opposite is not also true; whether, in the view of His Majesty's Government, the existence of this body of opinion is no reason why they should not give recognition to Seretse Khama. If the opposite is also true I suggest that if unity can be secured within the tribe there is no reason left for the refusal of this recognition.
  I want to draw the attention of the Minister to the reports which have appeared in South African newspapers, claiming that the decision of the Government in this matter represents a defeat of British liberalism and means the victory of the policy of apartheid for which the South African Government stands. I believe that the Government have started on a course of appeasement with the South African Government, which stands for the principle of refusing to recognise those who belong to the black race as members of the human family at all. If one wants to find evidence of the real issues which are behind this case, they are to be found in the treatment which Seretse Khama has received since he has returned to Africa—the refusal by the Government of South Rhodesia even to allow him to stay in a State hotel because there are white residents there, the decision of the Southern Rhodesian Government to regard him as a prohibited alien who must not even land from his plane within a territory in which the over-

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  whelming masses of the people are Africans themselves, the decision of the whites in the town in Bechuanaland to which he has returned, to protest against his coming to that town. That represents a view against which this House should protest with its last breath, because that view represents an exclusion from the human family of one great race.
  I suggest to the Minister that if any Government takes that course, as the South African Government is now doing, it is not merely excluding another race from the all-embracing human family but is excluding itself from the mind and morality of the world. The Declaration on Human Rights of the United Nations says that we are all born equal, equal in human dignities and in human rights. It is on that principle that this Government ought to stand. I ask the Minister, when he replies, if he will, not in formal language but with warmth and inspiration, declare that His Majesty's Government does stand for the equality of all races, rejects the colour bar and will seek the earliest opportunity to enable the unity of the tribes in Bechuanaland to find reflection in the Chief who is of their own choice.
  11.43 p.m.
  Mr. Beverley Baxter: I believe that the marriage of Seretse Khama and this young London typist was in itself an unfortunate thing. [HON. MEMBERS: "Why?"] I only wish to put my opinion. It may be a case where they found in each other congenial characteristics; it may be a case of complete love. I do not doubt that at all. Therefore, we may say that, with human rights as they are, this man and this woman had a right to seek each other out and marry, but from a broad standpoint, it is politically unfortunate that it should have happened. There is an instinctive belief in all of us that the East and the West do not meet. [HON. MEMBERS: "No."] I am not defending or propaganding it, but if hon. Members had travelled as I have in the Southern States they would have found that there is an instinctive feeling that the black and the white do not marry because, for one thing, of the problem of the children.
  Dr. Morgan: It has existed in the Caribbean for generations.
  Mr. Baxter: There is not an hon. Gentleman or hon. Lady in this House
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  who will not agree with me, whether it is logical or not, that the instinct is there. I think we will perhaps agree that, so far, it was perhaps unfortunate that this marriage took place. I would like to think that I could carry the House with me that far.
  Mr. Sorensen: What does the hon. Member mean when he says that the matter is decided by instinct? There are many races in which this instinct does not exist. For instance, there is the case of France, the Caribbean Islands and New Zealand.
  Mr. Baxter: I know there is a saying in the French Empire that the Frenchman "goes black." That is a very old saying; nevertheless, there is—and I want to be reasonable and brief in what I have to say—this feeling that coloured and white people should not marry in spite of the characteristics and fine qualities of the different peoples involved. Once that decision had been taken, once this young man had married this young woman, I do not believe anything should have interfered with the marriage. However, if it caused trouble in the tribe, even though God or a local official or a clergyman joined two people together, it seems to me that we had to be very careful.
  All I want to emphasise is that on this matter I have a split mind. I regret that the marriage took place, but once it had taken place I think the Government handled the matter with a degree of clumsiness which we all regret. I think that the marriage should have been accepted as an unfortunate fact. I am sorry for the Minister, who came so quickly into this problem with so little preparation, but I think this matter has been handled from our side with great clumsiness from that time.
  11.48 p.m.
  Mr. Bowen: I rise to support the observations so eloquently made by the hon. Member for Eton and Slough (Mr. Brockway). All that I would say about the speech of the hon. Member for Southgate (Mr. Baxter) is that while I agree with the last statement he made I feel that it would be the greatest misfortune if discussion of this matter were to be sidetracked into a debate on the question of mixed marriages. The hon. Member for Eton and Slough apologised to the House. I certainly did not think

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  that his speech called for an apology. Certainly, the raising of this matter does not call for an apology. It may well be said that the time is not opportune for doing so; but the responsibility for that rests upon the Government and upon the official Opposition. This matter came to the notice of the House on 8th March. If it were not for the opportunity which has been seized this evening no opportunity would have been given for it to be debated for a further fortnight. Therefore, however unfortunate it is that this matter should be raised at this hour, I do not believe that any apology is required.
  I said that I thought it would be unfortunate if this Debate became a discussion upon the relative merits and demerits of mixed marriages. In my view it raises matters which are of far greater concern than that particular issue. The announcement of 8th March set out, in paragraph 15 of the White Paper, two aspects. First, it declares that the Government intends to withhold recognition of Seretse as Chief of his tribe. That is to say, despite the decision of the tribe that it desired that Seretse should be recognised as its Chief, the Government has decided to withhold its recognition and to withhold its recognition indefinitely. The other aspect of their announcement—one which in some ways struck me as being of even greater importance from a general point of view—was the decision to outlaw Seretse from his own homeland for an indefinite period of at least five years.
  Dr. Morgan: Diabolical.
  Mr. Bowen: Quite apart from Seretse's position in relation to this tribe and in relation to this Protectorate, I should have thought that a decision of the Government to ban a British subject from his native land for at least five years and, possibly for life—a person whom it is not alleged has committed any crime—is certainly a matter which calls for anxiety and which demands a very coherent explanation on the part of the Government. In addition, the position is accentuated by the fact that the person involved is an African. It raises the whole question of the good relationships and the atmosphere of faith and understanding between Europeans and Africans as a whole.
  It may have important repercussions on the whole of Africa and, in particular, on
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  the attempts now being made to develop responsible government in the Gold Coast and in Nigeria. From that point of view, I think this question is of great significance. It is important from the point of view of the relationship of the European to the African in our Colonies. It is important also from the point of view of the policy of this Government in its Colonies, in relation to the policy of South Africa, of Southern Rhodesia, and of Northern Rhodesia regarding racial discrimination and how far this conflict—this patently difficult conflict—is to be, overcome and in what way that problem is to be tackled.
  Why did the Government decide, on 8th March, to withhold its recognition of Seretse and to outlaw him from his own territory? One thing is quite clear, and I respectfully suggest that it is that the decision was not based on any allegation that Seretse himself had been guilty of any criminal conduct. It was not a case of the Government deciding that he was a person who, either from a moral or some other aspect, was wholly unfitted to be a Chief of a tribe. The only personal allegation made against Seretse is that he failed to seek the advice of others before entering into a marriage.
  According to the White Paper, and I accept it, the decision was not based on the ground that Seretse had married a white woman. It expressly provides that that did not form part of the argument or basis for argument for coming to the decision which was announced on 8th March. One thing, I would respectfully suggest to the Minister, is quite clear; that the African peoples and the people of this Protectorate in particular, will be left in no doubt in that the real reason for this decision on the part of the Government was an adherence to or an acceptance of South African and Southern Rhodesian policy in relation to racial discrimination.
  It is true that a judicial inquiry was set up in November to consider this matter. The point has been made by the tribe, by Seretse and by those who advocate their cause. In June, the authorities chose to refer this matter to the tribe. The tribe decided that it wanted Seretse as its Chief and the tribe expect their decision to be honoured by the British Government.
  One of the difficulties in this matter is the point raised by the hon. Member for

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  Eton and Slough in relation to paragraph 17 of the White Paper. It is true that the Minister for Commonwealth Relations, before the judicial inquiry was held, stated that the attitude of South Africa was not relevant in this matter. I refer to what he said on 3rd November when, in reply to a supplementary question he said:
  "The Government of South Africa did not come into this matter at all."—[OFFCIAL REPORT, 3rd November, 1949; Vol. 469, c. 563.]
  That was his statement.
  Again, in the White Paper, we are told that the views of South Africa and of Southern and Northern Rhodesia did not come into the matter at all; but if one looks at the way in which that judicial inquiry set up by the Government was conducted, it clearly shows that those taking part in it regarded the views of South Africa and of Southern Rhodesia as of prime relevance in coming to a decision in the making of recommendations by this Government.
  Might I refer to some of the evidence and to the cross-examination of Seretse by the Attorney-General? I will read from the transcript of the evidence taken at the inquiry.
  Mr. John Hynd: On a point of Order. I do not know whether the hon. Member has agreed to tell us the name of the document he is reading from, and whether it will be laid on the Table.
  Mr. Bowen: I believe I said I would read from the transcript of evidence given at the judicial inquiry, set up at the instigation of the British Government.
  Mr. Hynd: On a point of Order. Should it not he laid on the Table. Sir?
  Mr. Brockway: This evidence was given in public. It is public property. Surely an hon. Member has every right to quote from it?
  Mr. Deputy-Speaker (Major Milner): I think the hon. Member is in Order.
  Mr. Bowen: I inquired whether there was a copy of this transcript in the Library and I was told there was not. I think it would be an advantage to hon. Members because the evidence—in particular, the cross-examination of Seretse by the Attorney-General—makes very
  342
  interesting reading. What I find difficult to reconcile is the statement of the Minister that the attitude of the South African Government did not come into the question and the contents of the White Paper published a few weeks ago, with the conduct of the Attorney-General and the chairman of the judicial inquiry.
  The Secretary of State for Commonwealth Relations (Mr. Gordon-Walker): I should point out that I am not responsible for either of those people.
  Mr. Bowen: I agree that the Secretary of State is not responsible, but he has recognised in the White Paper that one of the matters he has taken into consideration in coming to this decision is the findings of that judicial inquiry.
  Mr. Gordon-Walker: I have not.
  Mr. Bowen: As paragraph 11 of the White Paper states categorically that the judicial inquiry unanimously advised against the recognition of Seretse Khama what was the object of referring to it?
  Mr. Gordon-Walker: Merely because allegations to the contrary had been made.
  Mr. Bowen: But paragraph 10 of the White Paper says:
  "As the report and the accompanying evidence form only a part of the matters considered …"
  Surely that means that one of the matters considered was the evidence of the report.
  Mr. Gordon-Walker: Considered, certainly.
  Mr. Bowen: Yes, considered. I am not arguing that the Minister was bound' to accept the recommendations of the inquiry but, in fact, he did. He came to the same conclusions. He may have taken the view that they came to the right conclusion on wrong grounds. He has not thought fit to reveal the wrong grounds.
  May I refer to the evidence given to the inquiry? This is the Attorney-General cross-examining Seretse:
  "Question: You know the position about Southern Rhodesia? I am not making any suggestion whether Southern Rhodesia or the Union is right or wrong, but do you know what the position of the Government of Southern Rhodesia is about you and your marriage?

  343
  Answer: I know that they are prejudiced, have colour prejudice.
  Question: Have you any objection to my putting in Southern Rhodesia's HANSARD?
  Answer: I have no objection."
  I have the minutes of the meeting of the House on Thursday, July 7th, 1949, when a Member by the name of Mr. Stockil moved the adjournment of the House "on a definite matter of urgent public importance"—
  Mr. Wyatt: Lucky chap.
  Mr. Bowen: It is not without interest to compare the way in which the Southern Rhodesian Government behaved in relation to this matter compared with our Government. They at least considered it a matter of urgent public importance. That Motion was moved with a view to considering
  "…. the immediate necessity of a statement by the Government on its attitude towards the decision taken at Serowe to accept Seretse Khama, Chief of the Bamangwato tribe, notwithstanding his marriage to a European woman."
  That question was raised specifically by the Attorney-General. Then Seretse asks the Attorney-General this question.
  "I want to know whether I am to be asked about the attitude of the Union of South Africa."
  The Attorney-General replied:
  "I am not going to ask any questions on that."
  However, when we come to the examination of the Resident Commissioner the question is raised by the Attorney-General and the chairman himself. These are the questions directed to the Resident Commissioner:
  "Do you know officially, or semi-officially, the attitude the Union are taking towards this particular matter? I mention this matter because, naturally, I read the newspapers and reports for instance of Mr. Malan's attitude, and apart from the fact that Seretse and his wife have been made prohibited immigrants, Mr. Malan is alleged to have made certain statements and certain representations. Could you, for the purposes of recording it in our inquiry, tell us what the effect is?"
  Then certain documents were put in. The next question asked was:
  "Now can you tell us, with regard to Northern Rhodesia, their attitude and that of Southern Rhodesia? The views of the Southern Rhodesian Parliament have been put in in a copy of HANSARD."
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  Then the Attorney-General goes on to put in a newspaper cutting of a speech made by Dr. Malan at the Nationalist Party conference. May I perhaps quote from the chairman:
  "Beyond these two occasions we have no official information on the attitude of the two Governments to which I have referred? No."
  It is quite clear from that that the Attorney-General presumably took part in that inquiry on behalf of the British Government.
  Mr. Gordon-Walker: No.
  Mr. Eric Fletcher: On a point of Order. The hon. Gentleman is quoting extracts from documents which are obviously of vital importance if this House is to form a considered judgment. These documents are in the possession of the hon. Gentleman. Can we have any guidance as to how they can be made available to us, Sir?
  Mr. Baxter: The hon. Member for Cardigan (Mr. Bowen) has been reading for a considerable time extracts which do not convey the slightest impression of anything to the House.
  Mr. Deputy-Speaker: Any hon. Gentleman is entitled to quote from any document and the House attaches what importance it thinks fit to it.
  Mr. H. Hynd: If the Chair is unable to assist us in this matter would the hon. Gentleman opposite be good enough to say where the document is available?
  Mr. Bowen: It is simply a record of evidence given at the public inquiry, and I have not the slightest doubt that on application to the firm of shorthand writers who made the transcription the hon. Gentleman could obtain a copy of it. I did suggest earlier that one might be made available in the Library of the House.
  One point which I have rather laboured was that the judicial inquiry was concerned with the attitude of the South African Government and the attitude in Northern and Southern Rhodesia, and that this was regarded as highly relevant. The other point I am trying to make is that this was a public inquiry, held in the presence of large numbers of the tribe concerned. It is, therefore, idle to suggest that the tribe, and indeed the

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  African population generally, are wrong. At least, it is understandable that they should consider that the real basis for the division in this matter is simply that South Africa and Southern Rhodesia have racial discrimination. I am not saying for one moment that they are right. They may well be wrong in their conclusions. But the way the inquiry was conducted, the whole line of conduct in this matter, certainly gives strong reasons for these conclusions. That is what I regard as one of the most unfortunate matters in this problem.
  Before I deal with statements advanced by the Government—[Laughter.] There seems to be considerable conflict in the House between hon. Members who regard this as of significance and importance and those who treat it in a completely frivolous fashion. I do not regard anything which may jeopardise the relations between Europeans and Africans in the African continent as a frivolous matter. Before I come to the reasons given by the Government for their position, I would refer to one other matter, which is referred to in paragraph 13 of the White Paper:
  "At no time was any assurance given to Seretse or to his representatives that if he came to London he would be permitted to resume residence in the Protectorate."
  This has been the subject of controversy in the Press and by different people. The legal adviser of Seretse who took part in the judicial inquiry has alleged that an undertaking was given orally by the Chief Secretary of the High Commissioner. I certainly do not challenge the statement in the White Paper that no assurance was given, but I feel that in a matter of this kind, where the integrity, the honesty and good faith of the Government are in question, we should have far greater detail relating to this than we have at the moment. There is the bare statement that no assurance was given.
  What I should like to know is: Was an assurance asked for? Was there a discussion about whether an assurance would be desirable or otherwise? What conversations took place between the legal adviser of Seretse and any Government official in relation to this matter? I feel that the uneasiness, probably created solely through a misunderstand-
  346
  ing, is not going to be dissipated until we have a far fuller statement about this aspect of the matter.
  According to the Government, they have three reasons for coming to their decision. The first is set out in paragraph 19 of the White Paper:
  "Peaceful administration would have become increasingly difficult."
  Surely one direct result of the British Government's position has been to endanger peaceful administration in this territory. In Fact, a considerable amount of unrest and uneasiness in this tribe has been created by the fact that the Government have chosen to go contrary to the wishes expressed by them last June. Therefore, I would suggest that the validity of the first point is questionable. The second is that in
  "contracting a marriage without prior consultation and against all the advice tendered to him by the tribal authorities, Seretse showed himself to be unmindful of the interests of his tribe and of his public duty."
  Seretse's evidence at the inquiry put that aspect fully and fairly. He admitted that it was a grave mistake on his part that before entering into this marriage he did not consult the tribal authorities and consider the advice tendered to him. He went on to add that that matter had been fully discussed by the tribe. They had had months, in which Seretse himself was out of the Protectorate, in which to consider the whole matter and they had decided, in spite of his indiscretions in that respect, to welcome him back and to wish that he should be their Chief. I suggest that if the Government have that consideration in their minds—his failure to take appropriate action, according to the tribal customs, before entering into marriage—then it is a view which is certainly contrary to that held by the tribe.
  The third argument is that it would increase the danger with regard to the authority of the chiefs. Surely there is ample provision to deal with that situation in the Proclamation of 1943 which, as I understand it, was the Proclamation invoked in order that an inquiry might be held into this matter. I entertain some doubts as to whether the holding of that judicial inquiry, by reason of that Proclamation, was lawful, because the basis upon which the inquiry was held is that there should be a vacancy in the chieftainship and at least it can be

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  argued, as, indeed, it was argued before the judicial inquiry, that there was no vacancy in the chieftainship and that Seretse was Chief before this Proclamation came into existence, although it is true that there was a Regent. In paragraph 2 of the Proclamation it states that the chief in existence at that time shall be deemed to be recognised by the High Commissioner and confirmed by the Secretary of State.
  Quite apart from that, the Proclamation provides for the situation where, as a result of opposition to the chief, his authority might be weakened. The Proclamation implies that the High Commissioner could suspend or depose the chief if that was the position. I should have thought that if there were any dangers in that direction the powers contained in the Proclamation would cover the situation completely.
  Another reason given is:
  "The tendency in this tribe to disputes about the succession would be aggravated by uncertainty as to their future attitude towards the children of the marriage."
  But the question of the succession might well not arise for many years because Seretse is now only 28 years of age; the question might not arise for 30, 40 or 50 years. I do not think that is an argument to advance for the Government's decision. In any case, there is ample machinery provided for the High Commissioner to intervene and for a judicial inquiry to be held into the merits of the case.
  I agree with the hon. Member for Eton and Slough that the Government would be doing much to undo the harm they have done to European-African relationships through their handling of this matter if they were to show themselves brave enough to reconsider the decision they announced on 8th March. From the point of view of excluding Seretse from his territories, from the point of view of civil rights and civil liberties, it is a decision which the Government will find it difficult to justify. I feel that their conduct in not respecting the wishes of this tribe, or their being put into a position of being accused of attempting to change the constitutional position of this Protectorate, is something that is unfortunate. I urge the Government to consider
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  again, in the light of all the circumstances, whether it would not be better, in the interests of a happy and healthy relationship between the European and African populations of this area, to review their whole attitude.
  12.21 a.m.
  Mr. Quintin Hogg: I think that the hon. Member for Eton and Slough (Mr. Brockway) has done the House a service in raising this matter even at this late hour, since we are engaged in discussing a problem of great importance to an imperial country. This House of Commons, although it may find it difficult to discuss many topics, is almost ideally suited for discussion of this matter, as it is something upon which Members of all parties may feel different from one another. I broadly endorse the criticisms that have been made, although not always for the same reasons.
  I did not agree with the hon. Member for Eton and Slough in thinking that the question of mixed marriages was at issue in this Debate, if only because the Government themselves have disclaimed the view that they are actuated by any prejudice against them. I must say that I find the disclaimer a little puzzling, having regard to the conclusions to which they have come. I can understand, although I should not approve, a Government which said that marriages between races were so undesirable that they would punish or discriminate against people who indulged in them. What I do not even begin to understand is the attitude of a Government which apparently says that they have not the smallest prejudice against unions of this kind, but, nevertheless, decide that this man, who has embraced such a marriage, is not to be permitted to continue in his official position, in spite of the fact that that position has been endorsed by those over whom he is to rule for reasons which have nothing to do with mixed marriage, and which, having regard to that disclaimer, remain completely obscure to me.
  I fully concede the principle that the marriage of a prince has to be governed by considerations rather different from those which govern the marriage of an ordinary person. We have, after all, had experience of that ourselves. Those who are free to adopt unions of one kind or another by the civil law might, none the less, be rejected by a people on the

  349
  grounds that the marriage is unsuited to a prince. That has happened within living memory in places other than Bechuanaland. But surely that is a matter for the people concerned. If the kgotla, which decided in favour of Seretse Khama, had decided, as the White Paper says, that he had undertaken a marriage which rendered him repugnant to the trible, I should have been the first to say that that is a matter for the kgotla to decide, and that the British Parliament would be foolish to interfere in such a decision. But it came to the opposite decision.
  What we have to discuss here tonight is whether the Government have acted wisely, not in endorsing or refusing to endorse the marriage between a Bechuanaland prince and a London typist, but in over-riding the decision of the Bechuanaland tribe to accept this man and his wife as their prince and princess. It seems to me that this is the matter upon which the Government have virtually offered no case at all.
  I do not want to say a disrespectful word of the attitude of Europeans in Africa on the subject of mixed marriages, but, again, it seems to me that that is something which is not relevant to this discussion, because the Government have disclaimed that as a motive for their action. They say that there have been no representations from the European peoples of Africa to try to influence their decision. I must say that, whether their attitude on such matters be right or wrong, if the attitude of hostility to marriages of this kind is to be carried outside the boundaries of the territories over which they have jurisdiction, if it is to amount to the proposition not merely that such marriages are undesirable in the territories over which they have sovereignty but that they must attack the free decision of another people to take a different view about such marriages, then I think that whatever we may think about such prejudices, we are bound to resist an extension of them to the degree which I have indicated.
  Unless we were to resist it we should virtually be handing over imperial policy on this extraordinarily delicate and difficult matter to those who many of us believe are acting foolishly in the interests of the white races, because one would only in the end have to find a minority
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  sufficiently determined to assert its will and the Government would have again and again to submit to that will notwithstanding the fact that it was, according to the best judgment of this House and of the peoples concerned a mistaken attitude to adopt.
  That brings me to the conclusion which I have reached in the matter. Sretse Khama's marriage has become a symbol. It is perhaps a curious, perhaps a slightly ridiculous, fact that it should have become so. There are many other things which it might have symbolised, but in truth and in fact at this moment the case of Seretse Khama symbolises the determination of this Government to override the decision of a native people to accept as their prince and princess the person and his wife whom they would wish to see. I am not saying that there can be no circumstances at all in which such a decision might not be necessary, but what I do say is this: the Government have been given an opportunity to justify the decision which they have come to. It is a grave decision, and they have failed to justify it. In the long run the future of our country and of its Empire depends very largely upon the confidence with which we are regarded by the African race, not only in Africa but in other parts of the Empire as well. The future of our civilisation and our religion very largely depend upon the extent to which we can carry these people with us in the fight against Communism.
  It is not by any means a coincidence that the case of Seretse Khama has been eagerly taken up by Communists already all over the world in order to drive a feeling of hostility between the African people and their British friends. If that is so, and to the extent which it has succeeded, it is the fault of the want of statesmanship on the part of His Majesty's Government. It is perhaps fortunate that following this Debate tonight there can be no Division, because in such a, Debate we can express our opinions freely without any fear of upsetting the position of Ministers opposite. But I hope they will understand that not merely many hon. Members behind them, not merely hon. Members on the Liberal benches, but many hon. Members on these benches, question, on the highest Imperial grounds, the wisdom, as well as the

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  humanity, of the decision which they have taken.
  12.31 a.m.
  The Secretary of State for Commonwealth Relations (Mr. Gordon-Walker): I would like, if I may, to reply to two points made by the hon. Member for Cardigan (Mr. Bowen). He made reference to, and read extracts from, the evidence given before the judicial inquiry. But I must make it clear, as, in fact, it was made clear in the White Paper, that His Majesty's Government has not accepted the arguments produced in the report, and that it is not at all responsible for the way the inquiry was held and the evidence given before the inquiry, and so forth. The hon. Member is quite entitled to criticise the judicial inquiry, but not to go on from that to criticise the Government for what went on before that inquiry.
  Mr. Bowen: Will the right hon. Gentleman give some reason for not publishing the report and including a statement of the grounds on which the Government based its findings?
  Mr. Gordon-Walker: The reason we have taken that course is given in the White Paper. The reason is that the arguments are unacceptable to the Government, and that if they were published they would be made use of by Communists all over the world—and not only by Communists but by all sorts of people—as official Government policy. It would be impossible to catch up with the misrepresentation which would occur everywhere.
  The second point which the hon. Member made was whether Seretse Khama was in any way tricked into coming to London. There has been a great deal of feeling on this point, and if he had been tricked into coming that feeling would be justified. The hon. Gentleman asked me to give some details about the interview between Mr. Fraenkel, Seretse Khama's legal adviser, and Mr. Clark, Chief Secretary to the High Commissioner. It was a brief conversation only and a note was taken of it. Mr. Fraenkel asked, on behalf of his client, whether there would be some guarantee about a return to the Protectorate. Mr. Clark replied that, as Mr.
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  Fraenkel knew, no power existed to prevent a British subject having a valid passport from entering the territory; but there were powers existing under which an order could be issued for a person to leave the Protectorate. The legal position was explained quite clearly. At that time no decision was taken on this matter.
  I would like, if I may, to go straight to the root of this question, which has been raised in different ways by the hon. Member for Eton and Slough (Mr. Brockway) and by the hon. Member for Oxford (Mr. Hogg). That is, that we have taken a fundamentally wrong decision in this matter. I would like to meet that, and to state our argument on this point. It seems to me that, in part, the charge that we have reached a fundamentally wrong decision rests upon the ground that we have been anti-democratic, that we have over-ridden, or refused to accept the decision of, the kgotla.
  It must be made clear that the kgotla in this particular Reserve in the Bechuanaland Protectorate is not, and cannot be, accepted as a parliament. These are not a sovereign and independent people. Critics of the Government on this point must make up their minds upon which leg they are standing. If they talk of the kgotla as a Parliament, if they talk of these people as an independent people, they should go all the way and advocate withdrawal of the British Government from this Reserve. We must have it one way or the other. If they are not independent, if we must stay there to preserve order and good government, and to preserve the integrity of the territory, we have responsibility, and we must have rights to go with that responsibility.
  We must give due weight to kgotlas, but it cannot be argued that if we have the final duty of preserving good government in this territory and of preserving its integrity, we must accept, without question, the decision of a kgotla as if it were a Parliament in Britain. We must be clear, and critics must make up their minds which of the arguments they will follow. It is perfectly fair to argue that we ought not, in the circumstances, to have ignored or over-ridden a kgotla, but it is not right and fair to argue that we

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  had no right to do so and to come to the decision we did. I think the argument, therefore, must be upon the question whether we were, in fact, justified, as the hon. Member for Oxford said, in coming to this decision which we had a right to come to.
  The reasons for our decision are set out in the White Paper and I do not want to traverse the whole ground again. It is that, in our view, having taken all evidence we could and having consulted all opinions we could, the unity of the tribe was better served by the suspension of the recognition of Seretse Khama as chief. In our view, there were and would be, if he were recognised, grave dangers of a serious, continuing division and split among these peoples.
  We had indeed, as the responsible Government, to take into account not only the decision of the last kgotla but all the three kgotlas on this point because we had the duty to try and anticipate whether a certain action would lead to a split or not in the people. The three kgotlas, as is made clear in the White Paper, I think, were, in some respects, different one from another. The first kgotla, which is the only one in which the question of the mixed marriage in this particular case was a sole issue, was overwhelmingly against Seretse Khama and in favour of his uncle, Tshekedi. Seretse was at all three kgotlas. The second kgotla took up an intermediate position and the third kgotla swung in favour of Seretse. In the last kgotla the issue was no longer solely the question of the succession, the acceptance of the wife, the acceptance of the children alone but another issue had cut across it and had become increasingly more important—the issue whether the tribe wanted Tshekedi or Seretse.
  Tshekedi did govern for a very long period with very great ability and his reputation has been somewhat ignored in this matter. Tshekedi had become, as other good Governments occasionally become, unpopular. I do not know the rights or wrongs of that but what is clear is that when the kgotla was voting solely on the question of mixed marriage it was a very clear view, right or wrong. When it was voting largely on the question of Tshekedi and Seretse it had a different view. We had to take all three kgotlas into account to try and estimate what
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  would be the effect of any action, recognition, or non-recognition, upon this people and I think it is fair to say that the people might well in this matter revert, when the issue again became the sole issue of the mixed marriage, to the position they took up when that was the sole issue. It can also be argued, I think, uncontrovertibly, that it has never really been settled by this people whether they do accept the marriage, and certainly it has not been decided by the people whether they accept any children of the marriage. A chief who could exist in those circumstances would be in an extremely weak and in an increasingly weak position against the opposition that would come under a good chief, as it did come to Tshekedi.
  I was asked by the hon. Member for Eton and Slough what would our attitude be if a reconciliation between Tshekedi and Seretse takes place. Of course, a reconciliation between the two is very much to be desired. It would certainly, I think, reduce the tension and difficulties among these people, but I cannot give an absolute, categorical answer to a hypothetical question. What we would have to consider is the question of the unity and so forth of the people. Quite clearly, that would amount to a new factor and would necessarily involve us in a very careful reconsideration of the matter.
  Mr. Brockway: I do not want my right hon. Friend to give a categorical answer to a hypothetical question—but he would not rule out a consideration of this matter if such a reconciliation took place?
  Mr. Gordon-Walker: That is just about what I said. I should also point out to the House that it was Tshekedi himself who raised, in the first place, the issue in this case and that all the time we have had to make a choice between two African views in this matter, as between Tshekedi and Seretse and his followers. There is no doubt, also, that if the hon. Member for Cardigan will read all the evidence he will find that African opinion was extremely divided in the Bantu Press of the Union and that evidence was given against the recognition of Seretse. Spokesmen of the neighbouring tribes did the same.
  Mr. Driberg: Not spokesmen—they were there as individuals, not representatives.
  Mr. Gordon-Walker: They were two leading people who were not contradicted by other members of the tribe. I do not say, of course, that African opinion is unanimously against Seretse. All I would say is that it was far from unanimous on the other side, and there was much weight of African opinion, quite distinct from European opinion, that Seretse should not in the interests of the tribe—and for very much the same reasons that led us to our conclusion—be recognised as chief.
  Lord John Hope: It has been suggested that those two spokesmen were not representative of their tribes in that the rest of their tribes were in favour of recognition. I think it is important that the Minister should say whether those tribes from which the two spokesmen came were against or in favour of recognition.
  Mr. Gordon-Walker: The leading people who spoke on behalf of those tribes said they were against recognition. There were other tribes that took another view. Views may be divided among the Africans themselves on the point, as the hon. Member for Cardigan said. From the difficulties in the tribe resulting from our decision, and, indeed, after the act of marriage contracted by Seretse, there were bound to be difficulties whatever decision was taken. The difficulty, rightly or wrongly, was created by the act of marriage. We had to balance one set of difficulties against another and we came to the conclusion that the difficulties that would result from the suspension of recognition—though possibly for the moment that was more difficult—would be much less grave and less lasting than the difficulties that would result from recognition.
  It is a difficult transition that we are going through. Reorganisation of the tribe, the setting up of the new native authority in these circumstances, will involve difficult handling of the problem, and there is no doubt that Seretse's followers, about half a dozen of them, in the absence of Tshekedi's followers, who have gone into exile with him, have attempted to create some trouble in this tribe and have to some extent succeeded. They organised a display of considerable force, although not violence, and they used threats to stop the kgotla convened by the High Commissioner, and
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  on 14th March a group of young followers of Seretse threatened to burn down the house of an African doctor because they thought Tshekedi was there, and made it clear that if they had found him they would have made it tough for him.
  There are difficulties of this sort and I have given new facts to the House; but the Government's decision is a firm decision—a decision not to recognise Seretse for five years or thereabouts. We are not going to be intimidated by violence or threats of violence and I ought to repeat that Seretse's return to the Protectorate, which I announced the other day, is on condition of his own good conduct and also that the order and good government of the tribe are not disturbed. That ought to be said because if those conditions are not fulfilled, of course, we must reconsider the permission we have given him to return to the Protectorate.
  The last point is this: I admit, and it is obvious, that the critics of the Government in this matter are moved by very deep feelings. As the hon. Member for Oxford has said, Seretse has become a symbol. To a large extent the reason why he has become the symbol of the clash of colour in Africa is because of the dangerous misconception to which many of these critics jump and spread irresponsibly. It is largely, although not entirely, due to the critics that it has got abroad that our decision over Seretse Khama is almost a complete alteration of our colonial policy, our policy on mixed marriages and the colour bar.
  People have said in my hearing that the British Government's policy has been put back 20 years, and all sorts of other things have been loosely said. They are totally untrue. It is exactly the same as before. We are progressing exactly the same as before with the development of the colonial peoples and democracy. Not a single mixed marriage, including this one, is illegal in the Colonial Empire as a result of this decision we have taken. The issue is whether a person can, as public head of a community or people, do things which it is his undoubted right to do as a private individual. I maintain that our decision in this matter was right, but even if hon. Members say that our decision was wrong, it still does not involve the question of our colonial policy, mixed marriages, and the legality and validity of such marriages.

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  The hon. Gentleman the Member for Cardigan asked me to give a restatement of the Government's views, but I do not think there is any need to do that. Our record is satisfactory, our policy speaks for itself. Only because of misrepresentation is it necessary to re-affirm with emphasis that the Government's policy in this matter remains unaltered by the decision in this case.
  Several Hon. Members rose—
  The Parliamentary Secretary to the Treasury (Mr. William Whiteley)rose in his place, and claimed to move, "That the Question be now put."
  Question put, "That the Questior be now put."
  The House divided: Ayes, 198: Noes, 80.

  Division No.5.]

  AYES

  [12.50 a.m.

  Adams, Richard

  Griffiths, W. D. (Exchange)

  Morris, P. (Swansea, W.)

  Allen, A. C. (Bosworth)

  Haire, John E. (Wycombe)

  Moyle, A.

  Anderson, A. (Motherwell)

  Hale, J. (Rochdale)

  Mulley, F. W.

  Awbery, S. S.

  Hall, J. (Gateshead, W.)

  Nally, W.

  Bacon, Miss A.

  Hall, Rt. Hon. Glenvil (Colne Valley)

  Neal, H.

  Baird, J.

  Hamilton, W. W.

  Noel-Baker, Rt. Hon. P. J.

  Barnes, Rt. Hon. A. J.

  Hannan, W.

  Orbach, M.

  Bartley, P.

  Hardman, D. R.

  Paling, Will T. (Dewsbury)

  Beswick, F.

  Hardy, E. A.

  Pargiter, G. A.

  Bing, G. H. C.

  Hargreaves, A.

  Paton, J.

  Blenkinsop, A.

  Harrison, J.

  Pearson, A.

  Blyton, W. R.

  Hastings, Dr. Somerville

  Peart, T. F.

  Boardman, H.

  Hayman, F. H.

  Poole, Cecil

  Booth, A.

  Herbison, Miss M.

  Price, M. Philips (Gloucestershire, W.)

  Bottomley, A. G.

  Holmes, H. E. (Hemsworth)

  Proctor, W. T.

  Bowden, H. W.

  Houghton, Douglas

  Pryde, D. J.

  Braddock, Mrs. E. M.

  Hoy, J.

  Pursey, Comdr. H.

  Brook, D. (Halifax)

  Hubbard, T.

  Reeves, J.

  Broughton, Dr. A. D. D.

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

  Robens, A.

  Brown, George (Belper)

  Hughes, Emrys (S. Ayr)

  Roberts, Goronwy (Caernarvonshire)

  Burke, W. A.

  Hughes, Hector (Aberdeen, N.)

  Robertson, J. J. (Berwick)

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

  Hughes, R. M. (Islington, N.)

  Robinson, Kenneth (St. Pancras, N.)

  Carmichael, James

  Hynd, H. (Accrington)

  Ross, William (Kilmarnock)

  Champion, A. J.

  Irving, W. J. (Wood Green)

  Royle, C.

  Cocks, F. S.

  Isaacs, Rt. Hon. G. A.

  Shawcross, Rt. Hon. Sir H.

  Coldrick, W.

  Janner, B.

  Shurmer, P. L. E.

  Collindridge, F.

  Jay, D. P. T.

  Silverman, J. (Erdington)

  Cook, T. F.

  Jeger, G. (Goole)

  Simmons, C. J.

  Cooper, J. (Deptford)

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

  Slater, J.

  Corbet, Mrs. F. K. (Peckham)

  Jenkins, R. H.

  Snow, J. W.

  Cove, W. G.

  Johnson, J. (Rugby)

  Sorensen, R. W.

  Craddock, George (Bradford, S.)

  Johnston, Douglas (Paisley)

  Sparks, J. A.

  Crawley, A.

  Jones, D. T. (Hartlepool)

  Stewart, Michael (Fulham, E.)

  Crosland, C. A. R.

  Jones, Elwyn (West Ham, S.)

  Strachey, Rt. Hon. J.

  Cullen, Mrs. A.

  Jones, W. E. (Conway)

  Sylvester, G. O.

  Dalton, Rt. Hon. H.

  Keenan, W.

  Taylor, R. J. (Morpeth)

  Darling, G. (Hillsboro')

  Kenyon, C.

  Thomas, D. E. (Aberdare)

  Davies, Edward (Stoke, N.)

  King, H. M.

  Thomas, T. George (Cardiff)

  Davies, Ernest (Enfield, E.)

  Kinley, J.

  Thorneycroft, Harry (Clayton)

  de Freitas, Geoffrey

  Lang, Rev. G.

  Thurtle, Ernest

  Deer, G.

  Lee, F. (Newton)

  Timmons, J.

  Diamond, J.

  Lever, L. M. (Ardwick)

  Turner-Samuels, M.

  Dodds, N. N.

  Lewis, J. (Bolton, W.)

  Vernon, Maj. W. F.

  Donnelly, D.

  Lindgren, G. S.

  Wallace, H. W.

  Dugdale, Rt. Hon. J. (W. Bromwich)

  Lipton, Lt.-Col. M.

  Watkins, T. E.

  Dye, S.

  Logan, D. G.

  Weitzman, D.

  Ede, Rt. Hon. J. C.

  Longden, F. (Small Heath)

  Wells, P. L. (Faversham)

  Edwards, W. J. (Stepney)

  McAllister, G.

  Wells, W. T. (Walsall)

  Evans, Albert (Islington, S. W.)

  MacColl, J. E.

  West, D. G.

  Evans, S. N. (Wednesbury)

  McGovern, J.

  Wheatley, Rt. Hn. John (Ed'nb'gh, E.)

  Ewart, R.

  Mack, J. D.

  Whiteley, Rt. Hon W.

  Fernyhough, E.

  McKay, J. (Wallsend)

  Wilkins, W. A.

  Field, Capt. W. J.

  McLeavy, F.

  Willey, F. T. (Sunderland)

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

  MacMillan, M. K. (Western Isles)

  Williams, D. J. (Neath)

  Follick, M.

  MacPherson, Malcolm (Stirling)

  Williams, Ronald (Wigan)

  Forman, J. C.

  Mainwaring, W. H.

  Williams, W. T. (Hammersmith, S.)

  Fraser, T. (Hamilton)

  Mallalieu, E. L. (Brigg)

  Wilson, Rt. Hon. J. H. (Huyton)

  Freeman, J. (Watford)

  Mallalieu, J. P. W. (Huddersfield, E.)

  Winterbottom, I. (Nottingham, C.)

  Gaitskell, Rt. Hon. H. T. N.

  Manuel, A. C.

  Winterbottom, R. E. (Brightside)

  Ganley, Mrs. C. S.

  Marquand, Rt. Hon. H. A.

  Wise, Major F. J.

  Gibson, C. W.

  Mathers, Rt. Hon. George

  Woodburn, Rt. Hon. A.

  Gilzean, A.

  Messer, F.

  Woods, Rev. G. S.

  Glanville, J. E. (Consett)

  Middleton, Mrs. L.

  Yates, V. F.

  Gordon-Walker, Rt. Hon. P. C.

  Mitchison, G. R.

  Younger, Hon. Kenneth

  Greenwood, A. W. J. (Rossendale)

  Moeran, E. W.

  Griffiths, D. (Rother Valley)

  Monslow, W.

  TELLERS FOR THE AYES:

  Griffiths, Rt. Hon. J. (Llanelly)

  Morgan, Dr. H. B.

  Mr. Popplewell and Mr. Delargy.

  NOES

  Acland, Sir Richard

  Gage, C. H.

  Ormsby-Gore, Hon W. D.

  Alport, C. J. M.

  Galbraith, T. G. D. (Hillhead)

  Pitman, I. J.

  Amery, J. (Preston, N.)

  Garner-Evans, E. H. (Denbigh)

  Price, H. A. (Lewisham, W.)

  Arbuthnot, J. S.

  George, Lady M. Lloyd

  Prior-Palmer, Brig O.

  Ashton, H. (Chelmsford)

  Granville, E. (Eye)

  Raikes, H. V.

  Assheton, Rt. Hon. R. (Blackburn, W.)

  Grimston, Hon. J. (St. Albans)

  Roberts, Emrys (Merioneth)

  Baxter, A. B.

  Heath, Colonel E. G. R.

  Roper, Sir H.

  Bowen, R.

  Hinchingbrooke, Viscount

  Russell, R. S.

  Bromley-Davenport, Lt.-Col. W.

  Hogg, Hon. Q.

  Sandys, Rt Hon. D.

  Brooke, H. (Hampstead)

  Hope, Lord J.

  Scott, R. D.

  Buchan-Hepburn, P. G. T.

  Howard, G. R. (St. Ives)

  Smithers, Peter (Winchester)

  Butcher, H. W.

  Hutchinson, G. (Ilford, N.)

  Soames, Capt. C.

  Clarke, Col. R. S. (East Grinstead)

  Keeling, E. H.

  Spence, H. R. (Aberdeenshire, W.)

  Clarke, Brig. T. H. (Portsmouth, W.)

  Lee, Miss J. (Cannock)

  Spans, Sir P. (Kensington, S.)

  Colegate, A.

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

  Stuart, Rt. Hon. J. (Moray)

  Conant, Maj. R. J. E.

  Lloyd, Selwyn (Wirral)

  Taylor, C. S. (Eastbourne)

  Crossman, R. H. S.

  Longden, G. J. M. (Herts. S. W.)

  Teeling, William

  Crouch, R. F.

  Low, A. R. W.

  Thomas, J. P. L. (Hereford)

  Davidson, Viscountess

  Lucas-Tooth, Sir H.

  Thompson, K. P. (Walton)

  Digby, S. Wingfield

  McCorquodale, Rt. Hon. M. S.

  Tilney, J. D.

  Drayson, G. B.

  Macdonald, A. J. F. (Roxburgh)

  Wheatley, Major M. J. (Poole)

  Drewe, C.

  Mackeson, Brig. H. R.

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

  Driberg, T. E. N.

  Maclean, F. H. R.

  Wilson, G. (Truro)

  Duncan, Capt. J. A. L.

  Macmillan, Rt. Hon. Harold (Bromley)

  Wyatt, W. L.

  Fisher, N. T. L.

  Macpherson, N. (Dumfries)

  Foot, M. M.

  Manningham-Buller, R. E.

  TELLERS FOR THE NOES:

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

  Maude, A. E. U. (Ealing, S.)

  Mr. Mikardo and Mr. Grimond

  Fraser, Sir I. (Lonsdale)

  Morrison, Maj. J. G. (Salisbury)

  Question put and agreed to.

  Bill accordingly read a Second time, and committed to a Committee of the Whole House for today.

  PURCHASE TAX (ROAD VEHICLES)
  Resolved:
  "That the Purchase Tax (No. 5) Order, 1949 (S.I., 1949, No. 2358), dated 16th December, 1949, a copy of which was laid before this House on 20th December, 1949, in the last Parliament, be approved.—[Mr. Jay.]

  PURCHASE TAX (GREETING CARDS)
  1.0 a.m.
  The Financial Secretary to the Treasury (Mr. Douglas Jay): I beg to move:
  "That the Purchase Tax (No. 7) Order, 1949 (S.I., 1949, No. 2443), dated 28th December 1949, a copy of which was laid before this House on 30th December, 1949, in the last Parliament, be approved."
  I should like to explain frankly, and I hope briefly, the difficulties which have given rise to this Order. This is a rather smaller matter than most of those which we have been discussing today. Its difficulties illustrate all too well the problems we have in administering the Purchase Tax. In the Finance Act, 1948, as approved by this House, we overhauled all the Purchase Tax and we sought to
  360
  achieve two objects—on the one hand, to maintain our general disinflationary policy by taxing luxuries and less essential goods more highly, and, on the other hand, to lower taxation on the more essential goods. In order to do that it became necessary to make a distinction between the more essential goods, and the less essential goods in each of the various groups subject to Purchase Tax. I wish it had proved as easy to find satisfactory lines of demarcation as it is to point out the oddity of some of the lines of demarcation which we had to adopt.
  In group 34 in the Purchase Tax Schedule of the 1948 Finance Act, which consists of diaries, calendars, greeting cards and similar articles, the lowest rate of Purchase Tax applied was 33⅓ per cent. Where the goods in question were pictorial they came under the general heading in group 25 of the Schedule, consisting of pictures, prints, engravings, photographs and similar articles, which were taxed at 100 per cent. That was, in fact, a general distinction similar to that between the utility and non-utility goods in other parts of the Schedule which were subject, of course, to a low rate and a high rate of tax respectively.
  Before we introduced this Order which we are discussing tonight the tax on greeting cards was, therefore, the House will recognise, at the same rate of 100 per cent. and, indeed, it was at the higher rate of 125 per cent. between November, 1947, and the Budget of April, 1948.

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  There was one further complication. In group 25 it had been decided, to meet views expressed in the House, that relief should be given to reproductions of works of artistic merit, which was done by applying a rate of 66⅔ per cent. to reproductions of works executed more than 100 years ago.
  The result of that series of decisions by the House was that we had three different rates of tax for different types of greeting cards at the same time. After a time the trade represented to us that this three-tier system, and in particular the distinction between pictorial and non-pictorial greeting cards, was very hard to work satisfactorily. We took note of that and, in consultation with the trade, the Customs made a prolonged effort to frame administrative rules which would provide workable definitions on the lines which this House had laid down. I should like to pay tribute to the help we received throughout from the trade in attempting to find a solution, and also to assure the House that we have tried to find a solution which would be fully acceptable to the trade as well as to the Customs.
  In fact, I am afraid that that attempt to work out satisfactory definitions proved to be so difficult that by the late summer of last year it appeared, I think, both to the trade representatives and to the Customs, that it was essential to simplify the matter by applying a uniform rate of tax to all greeting cards and other articles in this group, except for those of the very plainest type. Therefore, after much consultation with the trade, and in the belief that the trade would find the proposed new arrangement more workable than any other that could be devised, the Order now before the House was made on 28th December, laid before the House on 30th December, and came into force on 1st February. What the Order does is to apply the 33⅓ per cent. rate to any calendars, postcards, greeting cards, etc., which, in the words of the Order, do not incorporate
  "any pictorial representation, any decorative pattern or device, or anything attached by way of decoration,"
  and which are on single colour paper. The reason why this simplification was laid before the House at the end of December was that, from the trade's point of view, it enabled them to switch
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  over to the new arrangement at their new seasonal operations in the new year.
  Although the simplification contained in this Order was drawn up in consultation with the trade, after it came into operation the representatives of the trade informed us, as they had not done before—I do not believe they had become aware of this point before—that further difficulties had been caused by the new definition. For instance, business calendars became chargeable at 100 per cent., whereas before they had been at 331 per cent. We were anxious to find a definition which would be as acceptable as possible to the trade manufacturing these cards.
  Therefore, we did not hesitate at that stage to ask the Purchase Tax Committee of the Printing and Allied Trades, which was dealing with this matter, to put forward its own proposals, in the light of this further experience, for the most practical definition between articles to be charged at 100 per cent. and 33⅓ per cent. It seemed to us that we ought not to be afraid to change our minds. I am glad to say that after this further protracted and, I hope, final consultation we have now reached the stage where both sides are very near to agreement on a new formula that should provide a practical solution.
  Our intention is, therefore, to replace this No. 7 Order very shortly by a new Order, which should clear up the uncertainty and provide the best possible definition. The House may very well ask why, if we are going to do that, it is necessary to approve this Order tonight. The reason is quite simple. If this Order were not applied, the tax rates would revert to the even less satisfactory position which prevailed up to 1st February, and then return again, after a very short period, to the arrangement which we propose in the intended new Order.
  Sir Herbert Williams: I understand that if we repeal an Act of Parliament which destroys another, that does not revive the original. Do I understand from this that if we repeal the Order, it revives the Order which preceded it?
  Mr. Jay: If this Order lapses, the position returns to what it was before 1st February. That would mean operating three different structures of tax within a

  363
  matter of a week or two, and I am sure that the House will agree that that would involve the maximum of disturbance to both the trade and the Customs administration. Therefore, as the simplest practical way out of this difficulty, I would ask the House to approve this Order tonight on the understanding that we shall very shortly introduce an amending Order which will establish what is now regarded, after these prolonged discussions between the people concerned, as the most workable and satisfactory arrangement.
  1.11 a.m.
  Mr. Assheton: I am sorry that the Financial Secretary has had as his first task in his new office to defend this ludicrous Purchase Tax (No. 7) Order. It is a fine example of the ineptitude and folly of this Government and shows how the business community is harassed and frustrated at every turn. I am sure that the hon. Gentleman and others who have studied the canons of taxation will remember that a tax ought to be certain in its incidence and clearly understood by the taxpayer. Those are two points which should always be borne in mind when imposing taxes, but in this case neither of those canons of taxation was regarded.
  The House ought to consider a little bit the history of this because I do not gather that the history was quite as the Financial Secretary has put it forward to us. The position was that before 1st February the Finance Act, 1948, was the governing document. Under that Act, Group 34 of the Schedule said that diaries, calendars, greeting cards and similar articles should be charged at 33⅓ per cent. tax. That was all right.
  Then the Customs officers started trying to charge certain of these calendars and greeting cards at 100 per cent. on the ground that they were under another group, Group 25, which deals with pictures, prints, engravings, photographs and so on. The trade disputed from the start that the Customs officers had any right or authority to charge 100 per cent., and they paid under protest. The Government were quite clearly trying to dodge the decision of the House of Commons to charge these goods at 33⅓ per cent. and, by the back door, charging 100 per cent.
  364
  Legal opinion has been sought by various members of the trade, and the legal opinion has been that the Government and the Customs have not been right but have been wrong. So the Government come along with an Order to try to make it right. They therefore bring forward Purchase Tax (No. 7) Order which we are discussing tonight. This Order was made on 28th December and took effect on 1st February. The House has not had as early an opportunity as it ought to have done to discuss it because of the General Election. There was tremendous confusion in consequence of this. Before this Order was issued, a Treasury notice was put out expressing the Chancellor's intention of proceeding with the new Order, and all sections of the industry said that the new Order which it was proposed to make was quite impossible to interpret, and I am not surprised that they should.
  I have some illustrations to show the House. If cards are on one of the kinds of paper which I am holding, the tax is 33⅓ per cent., but if they are on the other kind the tax is 100 per cent. Nobody on either side of the House could possibly tell the difference—certainly not the Financial Secretary. I have two simple calendars here. They do not differ very much, but one is charged 33⅓ per cent. and the other 100 per cent. Why is this one taxed at 100 per cent.? Because there is a naughty little line round "July," and the Treasury says that if a line is put round that "July" the rate of tax will be 100 per cent. instead of 33⅓ per cent. Here are two calendars which look very much alike. This blue one pays tax of 33⅓ per cent. This red one pays 100 per cent.
  Is it surprising that stationers, master printers and greeting card manufacturers, object to this? They made no representation for a long time, and proceeded with the Order. Confusion was great, and different rulings were given in different parts of the country. Eventually, a new House of Commons was returned, and the Government found that it had only a small majority and consequently had to pay some regard to the representations being made by the trade.
  Now the Government come forward through the Financial Secretary to the Treasury and say that agreement has been reached with the trade, or nearly reached.

  365
  That does not really represent the position at all—" agreement has nearly been reached with the trade." I was given to understand that the agreement was entirely on the question of definition, and that there has been no agreement reached that the tax 041 greeting cards or calendars should be at the rate of 100 per cent. instead of 33⅓ per cent.
  Mr. Jay: I did not suggest that that was so. I said that agreement had been reached on the most workable definition which could be provided if we were going to have such a definition.
  Mr. Assheton: I understand that the Financial Secretary wishes to make it clear that there is no agreement on tax at the rate of 100 per cent., but only on the matter of definition. Of course the trade objected to this when the 1948 Act provided 33⅓ per cent. It is most undesirable to have such a tax imposed by an Order. It is a very undesirable method of taxing the people of this country because, if anything of this sort were introduced in the ordinary way in the Finance Bill it would have been pulled to pieces by half a dozen hon. Members who know about these things, and it would never have got through the House. All this foolishness would have been avoided.
  I understand that the Financial Secretary is to introduce a new Order shortly, perhaps in the next ten days or a fortnight. I want to ask whether he can give an assurance about the rates of tax. Can he assure us that the rate will in no case exceed 331 per cent.?
  Mr. Jay indicated dissent.
  Mr. Assheton: The hon. Gentleman indicates that he cannot. Therefore, I will indicate to him that when the Order is introduced, whether within ten days or three weeks, we shall oppose it if the rate of tax is raised above 33⅓ per cent. as it is at present, because we on this side of the House are against increasing taxes. We favour decreasing them, not increasing them. I do not know what other hon. Members think, but it seems to me to be very unreasonable that a thing like a Christmas card should be taxed at a rate of 100 per cent. Can the Financial Secretary give any justification why a rate of 100 per cent. should be charged on Christmas cards? They are the sort of things which a great many people like to send to one another.
  366
  There may be a number of sophisticated Members of Parliament on the opposite side of the House who think that they receive too many Christmas cards, that they are nuisance and therefore feel that they should be taxed. But ordinary people do not feel like that. They like sending and receiving Christmas cards. I do not see why they should not. To charge tax at the rate of 100 per cent. on them is not what the people will want. What is more, it is out of line with the tax on other things. Why a rate of 100 per cent. on Christmas cards and 33⅓ per cent. upon roulette tables? Or, for example, on some other things used at Christmas, such as paper caps, false noses, and clockwork mice, on all of which the rate of tax is 33⅓ per cent. And fireworks, no tax at all.
  I suppose the Financial Secretary thinks that the gentlemen in Whitehall really know better what the people of this country want. If he thinks that a roulette table is better for the country than a Christmas card, I doubt if anyone in the country will agree with him. The country is getting heartily sick of these punitive taxes and it is about time we made it clear that we do not like high Purchase Taxes on this side of the House. They raise the cost of living for everybody and they are interfering with trade, and particularly with the export trade. Imagine the confusion that manufacturers have to face in trying to make two different sorts of Christmas cards, one for the export trade and one for the home trade. You can only make these things pay if you have a considerable home demand to support your export trade.
  In addition, Purchase Tax is a great strain and burden on traders and retailers, and, as we have seen, appalling administrative difficulties come out of it the whole time. This high Purchase Tax bears very harshly on all quality goods and that, of course, is quite contrary to the sort of attitude which the Chancellor ought to adopt towards the export trade, because it is the quality goods we want for export. Moreover, the price disparities between taxed and untaxed goods are so great that they are really in many cases quite absurd. We believe that taxation ought to be reduced and not increased. We know that the Chancellor is a killjoy and an austerity merchant and all that sort of thing. Now he has taken on the role of a sophisticated sort of Scrooge and

  367
  superciliously sniffs at people—simple citizens—who want to send cards to their friends at Christmas time. I hope the hon. Gentleman will very shortly be able to re-assure us when he introduces this new Order, which he thinks is a better one, but if the tax is to be increased, I warn him we shall oppose it.
  1.24 a.m.
  Sir Herbert Williams: I thought we should have got some further statement from the Government Front Bench in view of what my right hon. Friend has said. I understood from what the Financial Secretary has told us that there is to be an Order which is satisfactory in character and is to reduce the rate of Purchase Tax to which we took exception. When my right hon. Friend was speaking, the Financial Secretary shook his head, and therefore I think he was not as candid with the House as he ought to have been. He led us to believe he was going to do things. That is what he led me to believe. [Interruption.] Then I am very sorry he is so incompetent in explaining what is in his mind. He said he had negotiations with the trade. [Interruption.] I do not know whom hon. Members are ordering about; that is a matter for Mr. Deputy-Speaker.
  The Financial Secretary led me to believe, and certainly led hon. Members near me to believe, that he was going to introduce a new Order which abated the grievances about which we complain. In the middle of my right hon. Friend's speech, when he asked him a specific question, the Financial Secretary shook his head, and therefore I am saying quite deliberately that he may have unintentionally deceived the House as to what is in view in respect of the new order. On the one hand, he is saying he is going to placate us, and then he is going to scourge us with whips. This tax was introduced in 1943, and the Financial Secretary will remember the arguments I made then. I really think we ought to have some further statement from the Front Bench in explanation of what they previously said in view of the fact the Financial Secretary did say things which I misunderstood and which my hon. Friends misunderstood.
  1.25 a.m.
  Mr. Jay: First I would correct the hon. Member for East Croydon (Sir H.
  368
  Williams) on a point of fact. He said that Purchase Tax was introduced in 1943. It was actually introduced in April, 1940, by a Government supported by the Conservatives and Liberals and not by the Labour Party. I should like to answer the questions asked by the hon. Member for Blackburn, West (Mr. Assheton). He asked me when the amending Order would be introduced. We hope within the next 10 days, if possible. He asked me to assure him that it would not contain the 100 per cent. rate. I certainly cannot give that assurance—[HON. MEMBERS: "Oh!"]—because, as I thought I made clear, the purpose of the new Order is to provide a more workable definition for the distinction between the 33⅓ per cent. rate on the one hand and the 100 per cent. rate on the other hand.
  May I just correct him on an important point? In fact, this does not imply that either the proposed Order or the No. 7 Order raises the rate of Purchase Tax on greeting cards or even on other items, because what he has failed to realise is that it was not the No. 7 Order but the Finance Act, 1948, which imposed the 100 per cent. tax on the pictorial type of cards. In group 25 under the 1948 Finance Act the 100 per cent. rate is made applicable to pictures, prints, engravings, photographs and so forth. I think he knows that it is a basic principle of Purchase Tax that wherever two rates are applicable to any commodity the higher rate is applied. That has been the case throughout the life of the Purchase Tax, and therefore it was laid down in the Finance Act of 1948 that the 100 per cent rate should apply.
  Mr. Assheton: The case I was trying to put was this—that the group 25 classification of 100 per cent. on pictures and photographs should not be applied to Christmas cards because Christmas cards were specifically mentioned under group 34 of the schedule to this Act of Parliament. I am advised that a legal opinion has been given that the Treasury and the Customs were wrong in charging Christmas cards under Group 25. That is a point the right hon. Gentleman did not meet.
  Mr. Butcher: I do not know where we are getting to. According to the 1948 Act, group 25 applies to pictures, photographs and that

  369
  sort of thing. But I understood this order we are discussing dealt with greeting cards under group 34. The right hon. Gentleman says "Oh, yes, but the principle of taxation is that whenever we have two charges, we always twist the taxpayer for the most we can get out of him." If you specifically refer to greeting cards in one group you are pretty nearly guilty of sharp practice if you charge on them a higher rate applicable to another group. We find that the amount of agreement with the trade is extremely limited. Is the right hon. Gentleman telling us now that the trade have agreed that greeting cards are no longer greeting cards but photographs or pictorial representations, because if they have, they should be punished by paying tax at the
  370
  highest rate. If they have not agreed, we are entitled to know before we part with this order, what exactly they have agreed to.
  Resolved:
  "That the Purchase Tax (No. 7) Order, 1949 (S.I., 1949, No. 2443), dated 28th December, 1949, a copy of which was laid before this House on 30th December, 1949, in the last Parliament, be approved."

  ADJOURNMENT.
  Resolved, "That this House do now adjourn."—(Mr. Popplewell.)
  Adjourned accordingly at Twenty-six Minutes to Two o'Clock a.m.

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  Poultry Project, Gambia
  Departmental Claims Branch, Liverpool
  Departmental Claims Branch, Liverpool
  Purchase Tax
  Purchase Tax
  Pool Betting (Revenue)
  Pool Betting (Revenue)
  Wine Shipments (Forms)
  Wine Shipments (Forms)
  Post-War Credits
  Post-War Credits
  Cost of Living
  Cost of Living
  Continental Day Excursions
  Continental Day Excursions
  Foreign Diplomats (Banking Accounts)
  Foreign Diplomats (Banking Accounts)
  OFFICIALS (POWER OF ENTRY)
  OFFICIALS (POWER OF ENTRY)
  BRITISH MUSEUM (READERS' TICKETS)
  BRITISH MUSEUM (READERS' TICKETS)
TRADE AND COMMERCE
  Spectacles (Import Duty)
  Spectacles (Import Duty)
  Newsprint
  Newsprint
  Film Industry
  Film Industry
  Cotton Industry
  Cotton Industry
  Cotton Spindles, Japan
  Cotton Spindles, Japan
  Utility Towels
  Utility Towels
  War Losses, Far East (Payments)
  War Losses, Far East (Payments)
SCOTLAND
  Nursing Sisters
  Nursing Sisters
  Housing
  Housing
  Fishing Industry
  Fishing Industry
  Scotland-United Kingdom (Financial Relations)
  Scotland-United Kingdom (Financial Relations)
FOOD SUPPLIES
  Polish Imports
  Polish Imports
  Fruit Pulp
  Fruit Pulp
  Ration Books
  Ration Books
  Feedingstuffs
  Feedingstuffs
TOWN AND COUNTRY PLANNING
  New Towns
  New Towns
  London Planning Administration Committee
  London Planning Administration Committee
  WOOLWICH ARSENAL (FIRE)
  WOOLWICH ARSENAL (FIRE)
  AIR RAID SHELTERS, WEST HARTLEPOOL
  AIR RAID SHELTERS, WEST HARTLEPOOL
  STREET PLAYGROUNDS
  STREET PLAYGROUNDS
HOUSING
  Sheffield
  Sheffield
  Ufford
  Ufford
  PUBLIC HEALTH, BRAMFORD
  PUBLIC HEALTH, BRAMFORD
  REGULAR ARMY COMMISSIONS
  REGULAR ARMY COMMISSIONS
Preamble
The House met at half past two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers
Several Lords—Took the Oath.

MESSAGES FROM THE KING
THE EARL OF CLARENDON: My Lords, I have the honour to present two Messages from the King, signed with his own hand. They are as follows:
"I have received your Address praying that the Summer Time Order, 1950, be made in the form of the draft laid before Parliament in pursuance of the provisions of Section 2 of the Summer Time Act, 1947. I will comply with your request."
"I have received your Address praying that there may be laid before your House Papers relating to the large number of crimes, accompanied by violence, occurring in large cities. I will give directions accordingly."

RUNCORN-WIDNES BRIDGE BILL [H.L.]
Read 2a.

NAVAL COURTS MARTIAL
2.40 p.m.
LORD MANCROFT: My Lords, I beg to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask His Majesty's Government when they expect to receive the Report of the Pilcher Committee on Naval Courts Martial and whether they are still waiting upon the receipt of this Report before implementing the recommendations of the Lewis Report on Army and Air Force Courts Martial.]
THE CHANCELLOR OF THE DUCHY OF LANCASTER (VISCOUNT ALEXANDER OF HILLSBOROUGH): My Lords, the Pilcher Committee presented to my noble friend the First Lord of the Admiralty
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the first part of their Report, dealing with the court martial aspects of their terms of reference, on February 21. This is now being considered in conjunction with the outstanding recommendations of the Lewis Committee.
LORD MANCROFT: While thanking the noble Viscount for his reply, may I ask him whether His Majesty's Government are aware that the long delay in putting into effect the recommendations and contemplated recommendations is causing some discussion, and will he do everything in his power to accelerate their implementation?
VISCOUNT ALEXANDER OF HILLSBOROUGH: Yes, certainly. I expect that noble Lords understand that a great many of the recommendations of the Lewis Committee have already been put into operation. On certain outstanding main points of the Report of the Lewis Committee, unless there was to be some risk of prejudice to the naval case, it was necessary to have the Report of the Pilcher Committee. As soon as consideration of the interim recommendations of the Pilcher Committee is finished, we shall take all possible steps to expedite the matter.
LORD WINSTER: Can the noble Viscount inform the House of the date on which the Pilcher Committee held their first sitting?
VISCOUNT ALEXANDER OF HILLS-BOROUGH: I cannot answer that question without notice. As I expect the noble Lord knows, the Committee were appointed just about twelve months ago, and they have taken about a year to complete their deliberations on this part of their terms of reference. This is probably about half the time that the Lewis Committee took to deal with the matter in a more major sense. On the whole, considering the pressure on the learned Chairman and other members of the Committee, I do not think we can grumble, though I had hoped that we should get an earlier result than we have in fact obtained.

SOLICITORS BILL [H.L.]
Read 3a (according to Order), and passed, and sent to the Commons.

COST OF LIVING
2.43 p.m.
LORD BALFOUR OF INCHRYE LORD BALFOUR OF INCHRYE rose to move to resolve, That this House expresses concern at the rise in cost of food, clothes and household goods since 1945, coupled with the decline in internal purchasing power of the pound, affecting the value of wages, pensions, allowances and savings. The noble Lord said: My Lords, the Motion that I beg to move deals with matters which I think your Lordships on all sides of the House will agree affect the well-being of every housewife, every breadwinner, and every pensioner in the country. The reason why I move this Motion to-day is that there is growing concern throughout the country at the steadily increasing cost of the necessities of daily life which every housewife has to buy. We, on this side of the House, feel that it is time to review that serious and deteriorating position and to hear what the Government have to say, for so far very little has been written or spoken by. Ministers—particularly at the Election—on the subject of this Motion. Not one word was there in the gracious Speech from the Throne of any reassurance that the Government intend to tackle this pressing problem. I cannot help feeling that the Government must be very glad indeed to-day to have the opportunity of associating themselves with the concern that is expressed in my Motion — concern at the increasing domestic burdens which now have to be borne.
Let me say that colleagues of noble Lords opposite in the Government feel as I do about this growing concern. There is a new Food Minister, Mr. Maurice Webb, and I am sure we all wish him good fortune in the heavy and responsible duties he has undertaken. This is what Mr. Webb has said about the question of the cost of living:
"In the great bulk of homes of the lower income classes—the working class, artisans, black-coat workers, and lower middle and professional classes—higher prices mean living on a subsistence level with little margin for amenities. Housewives are having to go out again to seek part-time work to supplement their husbands' earnings. For the first time since the war debts are beginning to be a normal feature of retail business."
That was written by Mr. Webb in the News of the World on October 17, 1948. Since that time the position has become worse. First, I should like to make sure
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that noble Lords on the other side of the House will join me in associating themselves with the concern that I express in this Motion, a concerti which we all feel and which cannot be divorced entirely from the promises on these matters made by the Government to the electors, or front the Government's responsibility for the policies which have fostered this rise in prices.
I submit to your Lordships two general propositions which cannot be contradicted. The first is that since 1945 there have been rises in a wide range of prices. The second is that the Government cannot get away from the fact that they gave unconditional pledges to the electors that Socialism would protect the citizens from the very troubles which now beset us. The situation is that a rise in the prices of food and goods has taken place and is taking place against a background of the steadily falling internal purchasing power of the pound. Housewives have been hit both ways at the same time. The price of the goods they have to buy has been going up and the purchasing value of currency has been going down. I made the charge that the Government had given pledges on this question and it is only right that I should he ready to substantiate what I say. Mr. Bevin, writing in the Daily Herald at the, time of the 1945 Election, said:
"Labour will protect your savings against rising prices."
Sir Stafford Cripps, speaking at Exeter in the same Election, said that the Labour Party wanted to ensure that the people's savings were safer than before the war.
Let us look for a moment at the position of savings, concerning which those pledges were given. These savings have been hardly earned and entrusted to the safekeeping of the Government since 1945. Their value has been described by the Chancellor of the Exchequer in another place. When asked what was the purchasing power of the pound sterling at the nearest convenient date as compared with 20s. in 1945, the Chancellor of the Exchequer said that the value was about 16s. 2d. in January, 1950. He had to admit that a savings certificate which was bought for 15s. in August, 1945, is now, with accrued interest, worth 17s. 0½d., but in purchasing power of 1945 it is worth only 13s. 10d. The Chancellor of the Exchequer rode off this admission, which

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I think is an admission of broken pledges, by saying that this lower purchasing power reflects only a change in the value of money which has been general all over the world. I suppose we shall hear more about that line of argument this afternoon. But can those who are going to take that line say that the investors were ever told at the time that the pledge about the safety of their savings was subject to outside factors in world conditions? No, those pledges were given unconditionally to those who entrusted their savings to the Government. If we are told that there is a world fall in the value of money and that the dollar has fallen in internal purchasing power in the United States even more than the pound has done in this country, then I would immediately ask, "Why on earth did we ever have to devalue?"
I turn from the question of the drop in the value of money to look at the other side, the extent of the rise in prices. Here I think I shall carry with me the noble Lord who is going to reply on behalf of the Board of Trade. There is no exact cost-of-living measure. The only index of retail prices which has been continuous since before the war is provided by the London and Cambridge Economic Service. The Board of Trade broke the cost-of-living index in 1947 and restarted it on a different basis. The London and Cambridge Economic Service give these figures. Taking the figure for 1938 as 100, they find that by 1946 the cost-of-living index was 150, by 1949 it was 178, and by February of this year the figure was 182. But the index used is a limited one; it is merely a measure of the increased cost of certain selected purchases which those preparing the index think are typical purchases of a working-class family. To my mind, a better way is to look at the typical needs of a household and then see how prices have risen. I do not believe that one housewife going out shopping with another would say: "Tell me, how are the indices to-day?" I am sure she would say "Vegetables cost more than last week, and clothes prices have gone up." That is the practical way of looking at the problem.
The noble Lord, Lord Llewellin, will speak later in the debate with regard to food, and on that matter he is far more
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authoritative than I. But one can go through a list of foods. Take, for instance, such items as home-produced beef: in 1945 it was 1s. 4d. a pound, and it is now 1s. 8d. One can take a whole series of various products. Dates have gone up from 9d. to 10d., and dried apples from 9d. to 1s. 6d. I will not weary your Lordships with a list, because I feel there is no doubt in anyone's mind that there has been a big rise in the cost of food. I should like to give one or two examples in regard to the cost of clothes for men and women. In 1946 men's socks were 2s. 8½d. a pair; they have now gone up to 3s. 11d. In 1946 a suit of clothes cost £3 14s. 9d.; it now costs £6 19s. 6d.
VISCOUNT ALEXANDER OF HILLS-BOROUGH: Of what grade are those suits?
LORD BALFOUR OF INCHRYE: I cannot say of what grade they are, but these are standard prices which I obtained from one of the large stores. A coat which was £5 has gone up to £6 15s. 0d. Then, to take the case of girls, a gym slip, which many athletic girls wish to wear, cost 16s. 3d. and has gone up to 24s. There is no question at all about the heavy impost on mothers with nurseries. Nursery squares—we call them "nappies"—were 13s. 4d. in 1946 and are now 25s. 6d. Let me give two examples of household goods. Wool blankets, 70 in. by 90 in., were 64s. 4d. a pair in 1946 and are now 91s. 6d. An oak utility bedroom suite cost £36 5s. 3d. in 1946 and now costs £39 10s. 0d. As I say, I do not want to weary your Lordships, and I have just picked out some average increases that we see all round us at the present time. I could repeat those examples over a whole range of household goods. Electricity, gas and coal have gone up; and such luxuries as tobacco and beer have increased to astronomical figures.
While prices rise, the Government are all the time trying to stem the tide of the effects of their financial policy by a wage freeze. We know that the Government obtained the assent of the Trades Union Congress, who in turn received from their constituents only a nominal majority for a continuation of the wage freeze so long as the cost of living figure did not rise beyond 118. But if the wage freeze is

529
not dead, it is very sick, and many authorities, including the New Statesman and other papers supporting the Government think, it is doomed. There are 180,000 railwaymen to-day earning less than £5 a week, and they have a strong sense of grievance. I believe that many noble Lords on all sides of the House sympathise with the men who have that grievance. Engineers are pressing for an all-round increase, miners are pressing their day-wage claims, and civil servants, firemen and teachers have all had their claims arrested. All these claims arise because incomes will not stretch to meet the ever-rising costs of the weekly needs on an accustomed standard of life.
Harsh as it is for the wage earner today, I would submit that the position bears even more harshly upon the fixed income sections of the community. An old-age pensioner who had an old age pension worth 26s. a week in 1946, now has a pension worth 21s. 6d. We have heard that it would cost £33,000,000 to compensate old-age pensioners for the fall in the purchasing power of their pensions, comparing 1946 with 1950. There is the much-abused class called the rentiers— those who live on a fixed income drawn from dividends. They are not all wicked capitalists; many of them are people who have worked very hard all their lives, who have invested their savings and are now living on the proceeds of their investments. The purchasing power of those people is falling lower and lower, and with the dividend limitation there seems no prospect of their position being alleviated. We have all this as against the pledge which was given in the broadsheet issued by the London Labour Party in 1946 and which said:
"The credit of the country will be conducted so as to prevent any inflation; i.e., a fall in the purchasing power of money."
I wonder what the people who gave credence to that pledge feel to-day, when they see their small incomes shrinking more and more in relation to the ability to purchase the necessities of daily life.
I want to pass from the present position to the prospects in the immediate future. We feel that there are more rises in prices coming over a wide field of national life. Domestic coal for London will be raised 4s. a ton if the freight charge application which is at present under consideration is granted. There is a prospect of higher rail fares, higher London bus fares and
530
higher farm prices, which mean higher prices to the consumer. But, bad as the position is, I do not believe the widespread effect of devaluation on retail prices has yet been felt. Since devaluation raw material prices have risen considerably. But the greatest risk for the future lies in the field of manufactured consumer goods, because increases in prices have in many cases been delayed until stocks which were bought at pre-devaluation figures have been consumed. That has caused delay, but it cannot stop the inevitable rise; and control by the Government cannot be so strong that it can compel manufacturers to produce, and retailers to sell, at a loss. Indeed, we have already seen—I do not think the noble Lord with his Board of Trade knowledge can deny this—that in regard to some utility goods the gross margins of profit have become so small that the supplies have dried up. In general, the increases have so far covered goods where the passage from raw material to the manufactured product is swift, as in the case of blankets, towels and knitted goods. But the increase in made up clothing, in a wide range of wearing cloths and in furnishing materials has yet to come.
I cannot help feeling that the country was not told frankly by the Chancellor of the Exchequer about the real effect of devaluation on the cost of living. The impression which the Chancellor gave in his broadcast, and in his speech in another place, was that the effect would broadly be limited to an increase in the price of bread and perhaps a few other articles. Let me remind your Lordships of the Chancellor's words. He said, at the time of devaluation:
"The immediate effect of the increase in the price of bread and flour will put up the cost of living index by just over half a point, and it may be that by the end of the year, if there are no marked counterbalancing decreases, the index will have gone up a point or so."
This method of the Chancellor of confining his forecast to a month or two must have led those of the general public who do not study these matters closely to believe that only a one-point rise in the cost of living need be expected from devaluation. I think it was regrettable that the country was not taken into the confidence of the Government to a greater degree at the time of devaluation than was the actual fact.

531
I want to turn for a moment to the factors which we feel have brought about this state of rising prices and lowering purchasing power of money. This Government pin their faith on checking inflation by means of a Budget surplus and by means of what we consider penal taxation, coupled with high Government expenditure and strong physical controls. That, in one sentence, I think, is their policy. This Government happily take 40 per cent. of the national income, and have no shame about it—indeed, they are proud of the fact, and say that it is good for the nation that it should he so. Though they pay lip service to other means of reducing the cost of living, which we believe are sound, their policy discourages personal savings and is no encouragement to greater production.
The Government control of industry, the refusal to link incentives to greater production—and other matters, with which I am not going to deal in detail to-day—are lines of policy to which the Government pay lip service but seem to do nothing to foster. Savings are discouraged and have disappointed. There are three reasons for the drop in savings. First, the present high level of taxation makes saving almost impossible for the average citizen. Secondly, the average citizen fears the loss in value of his money put away for the future. We have only to look at the example I have given of the loss in the value of money in the last few years to see that there is substance in that fear. Thirdly, the public fear the possible confiscatory measures which a Socialist Government may in the future take against profit and money.
Noble Lords opposite me here to-day are efficient and sound Ministers, but let me remind them that there are those of their colleagues who are not so sound, or so reasonable in their public declarations of what they would like to do with property. Government expenditure seems to go on, regardless of its relation to the ability of the nation to bear the burden of the constant overhead of Government expenditure. It is axiomatic that there is no wherewithal to sustain our standards of living except the proceeds of a healthy and prosperous industry. The old days of making the rich poorer in order to make the poor richer are gone; there are no hen-roosts to rob. Only from the proceeds
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of a healthy and prosperous industry can we sustain our daily standards of life, and yet the Government impose upon industry such an overhead as must hamper its competitive ability to manufacture cheaply for home production and for export.
We cannot permanently isolate our economy behind barriers of Socialism from world reactions and results. By artificial means of controls and shock absorbers, and by drawing on our resources, we can for a short time live as a law unto ourselves, but in the long run there can be no Socialist isolation for this country, whose continued existence and progress depends upon our ability to produce more and more. We feel that the only way in which the rise in the cost of living can be checked is by a great reduction in Government expenditure, and there is no sign that the Government accept that point of view. We say that the only other factor which might relieve the present situation would be a strong upturn in the trade position, but unfortunately this possibility also seems remote. In the first half of 1949, in terms of trade, matters had begun to move in our favour, but devaluation caused a sharp increase in our import prices. Therefore, we can look to no upturn in our foreign trade to get us out of the situation, and we feel that only by the Government's cutting their own expenditure can they reduce the burden of overhead which industry has to carry at the present time.
There is one direction in which the Government should at once give some lead, and that is to reduce or abolish the purchase tax on many household necessities. It seems to me extraordinary that with this problem in front of them, with the grave issues which must be faced in order to achieve a halt in the cost of living, the Government still retain purchase tax on so many articles of necessity. Utility fully-fashioned stockings, floor coverings, wallpaper, electric lamps, razor blades—just to give a list of some of those articles—all bear 33⅓ per cent. purchase tax. We are entitled to some explanation from the Government as to why they retain purchase tax on these articles and why at the same time we have to accept the rising cost of living.
There are remedies and suggestions, and arguments and counter-arguments, which might be put forward, but they are more appropriate in a full financial and

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economic debate, and I do not wish to enter into them to-day. I felt it was right, however, to give one or two broad lines of principle in which we believe. The chief of those is to cut expenditure and to return to sanity from the aura of political illusion that clever planning can get this country out of its troubles. No clever planning can do that. We feel that the prospect for the citizens of this country is grim, because we feel that so long as the Government pursue their theories and policies — which they obstinately continue to pursue—so long will the cost of living continue to rise. We feel that it is our duty to-clay to express our concern on behalf of millions of men and women, and that is what we are doing; we are expressing that concern by drawing attention to this problem. In the past, the Government have given pledges which they have broken, and the people now look to us to see that they have a fair and honest deal in the future. I beg to move.
Moved to resolve, That this House expresses concern at the rise in cost of food, clothes and household goods since 1945, coupled with the decline in internal purchasing power of the pound, affecting the value of wages, pensions, allowances and savings.—(Lord Balfour of Inchrye).
3.10 p.m.
VISCOUNT SAMUEL: My Lords, the terms of the Motion moved by the noble Lord, Lord Balfour of Inchrye, are in themselves unexceptionable. I think we all feel concern at the high prices; I do not suppose the Government spokesman will say that the Government are unconcerned. Whether the Government will thereupon accept the Motion, or whether they will see in it something less innocent than appears on the surface, I do not know; that must be left for them to declare. For my own part, I share to the full the views expressed in the terms of the Motion.
It is now just over two years since I opened a debate in your Lordships' House on the general economic situation. I then devoted my speech almost entirely to the question of high prices and of taxation as a factor in causing high prices. To-day I must speak on much the same lines—but, your Lordships will be relieved to hear, with much greater brevity. Since that debate in 1948 there has been no fall in the general level of prices or in
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the cost of living. It still remains, in my view and in the view of most people, excessively high. Devaluation last September was, of course, a factor tending towards an increase, and not a lowering of prices. Devaluation could not be avoided, the situation being as it was; but that the situation should have been such as to force devaluation was most deplorable, and devaluation was itself economically a disaster to this country. We are now beginning to see its effects in the rise of the cost of imported materials, and in the consequent rise in many classes of manufactured goods. The Board of Trade announced last month, for example, that carpets were to rise in price by 12½ per cent. as a consequence of the increase in the cost of the raw material due to devaluation. A week later they announced that knitted goods, which are widely used throughout the nation, were also to rise in price by 10 or 12 per cent:
I was recently staying in the West Riding of Yorkshire with a friend who is one of the principal blanket manufacturers in this country. He told me that as a direct or indirect result of devaluation blankets which he had been selling at £3 a Pair last September had now to be sold for £4 a pair. A rise of that kind imposes a very heavy burden upon the population. We have lately had the remaining subsidy on feeding stuffs stopped, in the interest of the Exchequer, but there has been no accompanying reduction in the general level of taxation. That again must be a factor in increasing the cost of living. We remember how the price of coal was raised very greatly a few years ago; now there is strong pressure for an increase in the freight rates on goods carried by rail.
The question that is continually being asked, in Parliament and everywhere, is: how shall we he able to meet the rise in the cost of living? That is the way in which the question is usually posed. But why should we accept that question at all? Is not the right question: how are we to prevent a rise in the cost of living and bring about a reverse in that economic tendency? People ask: will it be possible for the Government and the Trades Union Congress to continue to resist pressure for higher wages? That is not the right question. The question is: how can we get rid of the causes that give rise to the pressure for higher wages? If there were to be a fall in

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the general level of prices, what a relief it would be in every direction! The cost of living would be stabilised, or even reduced; wages might be stabilised without any hardship to the workers; in consequence the cost of production would be decreased through reductions both in the purchase of raw materials and in the cost of labour; and, with the increased use of mechanical methods, the cost of production ought over the years steadily to fall. In those circumstances exports could be expanded, the dollar gap could be closed, and the pound made secure.
Therefore, this question of the rise or fall in the general level of prices is the very essence of the whole matter. Our economic situation, and our future, depend upon that one factor. The purpose we should have in view, therefore—Government, Parliament and nation—should be to see whether it is possible to halt the increase and replace it by a fall. If that is generally agreed, the question then becomes simply a question of what lines of approach are possible. In the first place, I agree entirely with the noble Lord, Lord Balfour of Inchrye, that high Government expenditure and a high level of taxation are undoubtedly reflected in the level of prices. In my speech of two years ago I illustrated that in some detail, and I do not wish to repeat those details now. It is true that the high taxation now maintained by the Government may discourage inflation, or even prevent it, by diminishing private spending. On the other hand, a factor that works the opposite way, raising the general level of prices, is that people try to shift taxation from their own shoulders on to the consumers of their goods, which increases the cost of production with all its consequences; and that tends towards inflation.
The Chancellor of the Exchequer, a couple of years ago, I believe, laid down this general principle, which is as practical now as it was then:
"These general taxes undoubtedly reduce the expendable portions of all personal incomes, but there is always a tendency for those incomes to rise whenever possible to counter the taxation effect."
That is the essence of the whole matter: high taxation puts very strong pressure, throughout the whole economic system, on the individual—whether a workman who is taxed as he earns, a retailer, a manufacturer, or whoever it may be. All
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of them tend, if they can, to shift the burden on to other people in order that they may maintain the standard of living to which they have been accustomed. That is the reason why, while it may seem that high taxation is justifiable to prevent inflation, it is itself one of the very causes of the inflation that it seeks to prevent. There is also always the tendency for everyone—it is a very natural characteristic of human nature—to wish to pay less for what he buys and to get more for what he sells. He would like to buy in a free market and to sell in a closed market—he is a free trader for what he buys and a protectionist for what he sells. That is so in all countries and at all times. That also affects the price of labour. Labour wishes to raise its own price in the market by combinations—and it is right to do so: in fact it is absolutely essential that it should do so, because the individual workman, in the labour market by himself, is helpless when faced by an employer who has capital at his back and who is not under an obligation to come to terms immediately. Therefore, in this country and all countries it has been found that combinations of labour and the formation of trade unions are vital for the protection of the workman's interest. But when that same feeling leads him to restrict his own output or to oppose the introduction of labour-saving machinery which is economically needed, then that form of protectionism is illegitimate.
The noble Viscount, Lord Hall, when he spoke in this House two or three weeks ago, fully recognised this, and he used these words—he was talking, about incentives for production:
"Some of us worked under incentives fifty years ago. As a matter of fact, when I did some useful work"—
your Lordships will observe the implication!—
"the whole of my time was spent on a basis of piece work—payment by results. I would not work under any other system."
He then went on to say:
"It can be said that both the managements and the trade unions are doing everything possible to deal with this very important matter. Indeed, the Trades Union Congress General Council endorsed a policy which was agreed to by all the affiliated unions—this was only two or three months ago—"—
he was speaking on March 8–
"and which recommended that a review should he made within each industry with a view to extending systems of payment by results over the widest possible field."

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Perhaps the spokesman for the Government to-day may be able to tell us how far that campaign is proceeding and whether it tends towards success. For this, as all your Lordships will agree, is again of the very essence of the matter, because if we can get a larger output from the same labour force, then, again, our problems will be solved.
Manufacturers and retailers also have this natural desire to pay cheaply for what they buy and to receive dear for what they sell, and they are in the advantageous position by being able to form combinations for the fixing of prices. That has been proceeding to a great extent in many industries throughout the land. Employers to some extent have been demoralised by the sellers' market which prevailed during the war, and particularly in the building industry, where we were obliged to adopt the method of paying by cost plus percentage. That resulted in terrible waste and, to some extent, demoralised the industry. Here again, the effect of present conditions upon industries is to raise prices. In the building industry that is one of the causes of the continuance of the housing shortage, because we are paying for two houses now a sum of money for which we could have obtained three houses not so very long ago. If the cost of production had been the same, the housing problem might to some extent have been solved. The building industry is not doing its duty by the nation in providing at a reasonable cost the buildings that it requires, whether for housing or for other purposes. I was greatly struck by a report which appeared in The Times a few days ago of the annual meeting in London of the Association of Building Technicians. The President, Mr. Kenneth Campbell, said this of the building industry:
"The building industry is one of the greatest obstacles to progress. In nearly every way it remains a nineteenth-century anachronism unwilling to face contemporary moods and incapable of meeting them."
If that is true—and it comes from the President of the Association of Building Technicians who ought to know—we have there one explanation of the high prices that prevail in that industry.
Again, take what used to be one of the most important and prosperous of all our national industries—cotton spinning. The cotton-spinning industry sent a productivity team to the United States last
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autumn. Their report has just been published. It was a unanimous report representing, so far as I remember, the whole industry, employers and labour as well. They said that they had found that productivity, was generally higher in the United States than in Lancashire. They made a series of unanimous recommendations, and these are some of their findings., as reported in The Times:
"on the average, for every 100 operatives needed to produce a given quantity of roving in card-room processes over a given time in the United States, 263 operatives were required in England "
to do the same work. They stated that if the inquiry had been limited to the best mills in England where the best labour conditions and operating conditions applied, it would have shown that 153 operatives were needed here in England as compared with 100 in America. Similarly, to produce a given quantity of yarn in a given time, where the United States required 100 operatives, here we required 238, or 193 if only the mills with the best labour utilisation were counted. So that our best and most progressive mills employ nearly twice as many operatives as do similar mills in the United States. The team go on to say:
"The lower productivity in England, does not mean that English operatives work less hard. Some, in fact, work harder."
Then they gave a large number of technical reasons why the English cotton spinning, industry is very much behind the American industry in its methods.
That is the line on which we should proceed when we are seeking the causes of high costs in this country. That is the line that we ought mainly to pursue. We used to be proud of our technical capacity, and we used to boast that our industries were ahead of any others in the world. We cannot do that now When one is given concrete evidence from within the industries themselves, and not from foreign competitors or hostile critics, that the building industry and the cotton spinning industry are at fault—and those examples can be multiplied in the case of many others—we have an indication of where the remedy should be sought. The price-fixing associations eliminate competition unduly. They often restrict entry to trade and they undoubtedly produce excessive profits. Their prices are intended to protect the

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average or even the marginal firms below the average; and firms which are more efficient than the average, which are the most capable and adopt mass production on the largest scale, cannot help making large profits. Even if they were quite willing to sell for less they are not allowed to do so by their trading associations, and the money comes flowing in. We see at the present time the large dividends which are being declared week by week by many firms. It is said: "Well, that does not matter so much because taxation sweeps in most of the money in surtax and death duties, and people cannot grow rich on those profits." That may be so, but the consumer pays. The high prices are there. It is another instance showing how high taxation does ultimately, in a large degree, fall not necessarily upon the individual taxpayer but upon the consumer of the goods. The right and best way to reduce these excessive prices is undoubtedly to allow competition to have its effect, and to allow efficiency to reduce prices all round. The Chancellor of the Exchequer has clearly seen this. To quote him again, he said, I think in the House of Commons:
"A decrease in prices is far the most satisfactory way to get that reduction of profits."
He does not wish merely to sweep it in, and to let people grow rich, and then to take it away in super-tax and death duties; far better to let general prices fall.
Therefore, I come to the point to which I would venture to ask the special attention of your Lordships—that the most necessary thing to be done at this moment is to put into force the principles of an Act which by general consent your Lordships passed two years ago—namely, the Monopolies and Restrictive Practices Act, 4948. For twenty years we Liberals have been advocating a direct attack upon these systems of monopolised and restrictive trade, and the proposals we made have been almost exactly embodied in this Statute, and have at long last been accepted, by general consent, by the Conservative and Labour Parties. The Board of Trade, who are responsible for the appointment and direction of the Commission, have just issued their first report upon the working of this Act, and to my mind it is a document of very
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great importance. It is only a preliminary report; it cannot yet account for any concrete results, but it explains what work is going on and what inquiries are being made. Six industries have already been the subject of reference to the Commission—namely, those concerned with the supply of electrical filament lamps, the supply of insulated wires and cables, the supply of what are called rainwater goods, the supply of instruments, and so forth, used wholly or mainly in dentistry, the supply of machinery for the manufacture of matches, and the supply of matches. Those are the industries to which the attention of the Commission has been directed by the Board of Trade. There are also a large number of other industries which have been brought to the attention of the Commission by various consumer industries, by the general public, or by associations of consumers. That work is now going on. I should mention that the reference of these particular industries does not carry with it, to use the Board's own words, "any degree of adverse imputation." These are industries which may properly be the subject of inquiry; they are not industries which, in the opinion of either the Board of Trade or the Commission, are guilty of abuses. That ought to be made quite clear, in justice to those particular firms.
In this connection I should like to ask the Government whether they are satisfied with the progress that is being made in this vitally important province. We now have the machinery for investigating these restrictive practices. Are the Government satisfied that the machinery set up is adequate? The Commission consists of two full-time members and six part-time members. Do the Government consider that such a machine is capable of investigating the enormous range of industries and trades which are involved in this question? Or do they think—I make this suggestion—that the Commission would be well advised to appoint sub-commissions to carry on this work, if a delay of years is to be avoided before we get the fruits of their inquiries. Or, failing sub-commissions, do the Government think that a short amending Act might be passed to establish three, four or five different Commissions which might work simultaneously to investigate this very urgent matter?

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Lastly, there is the question of supplies from abroad. My noble friend Lord Balfour of Inchrye, who moved this Resolution, is a lifelong protectionist, and he is one of those who must take responsibility for the restriction upon international trade which has cluttered up Europe and the World, and which we are now to a great extent trying to abolish. It is now recognised that tariff protection or any other form of protection is not the solution. The present Minister of Health took credit to himself, as he was entitled to do, when he was faced by a ring, a combine which sent up the price of medicine bottles, and he did not hesitate to bring them in from abroad; and he thereby saved the taxpayers—one is glad to think that he sometimes thinks about them—a very considerable sum of money. Undoubtedly that should be continued.
Are the Government going to do their utmost to restore a healthy competition both in production and in distribution? Will they make that the key word of their policy? When an industry comes to the Government and asks for the removal of controls, will they take that into account and say, perhaps, "We will remove the controls, but conditionally. You say that you will be able to manufacture more easily and more quickly, and will be relieved of difficulties. We will remove the controls on condition that you effect an all-round reduction of price. Or are you going to put the advantage into your own pockets by producing more easily but allowing the price to remain at the present high level?" Will the Government bring pressure to bear from every direction, at all times, to secure an all-round reduction of, say, 10 per cent. in the general level of prices through a nation-wide campaign, as has been done with a certain measure of success in other countries? My Lords, the forces which make for higher prices are too strong for those that work the other way—labour restrictions on a higher output without any increase of production; employers' stopping or lessening genuine competition among themselves; merchants and retailers going back to the old guild system of restraint of trade and making it the exclusive province of a privileged group who can grow rich while the people suffer from dear goods.
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Are the Government going to attack the problem from that standpoint? Will the Government give us a specific reply on that point? It is natural for the Opposition to take a gloomy point of view, and natural for a Government spokesman to paint a rosy picture. Despondency is the natural mood of Oppositions, and complacency of Governments. I do not suppose that the noble Lord who will reply will plead guilty to complacency. In fact, if he follows precedent, his first words will be that the Government fully realise that there is no room for complacency. I am afraid I may have robbed him of his introductory sentence, but certainly he will agree to that in spirit and disclaim complacency. Will he go further and detail the concrete proposals with which the Government propose to meet a situation which is undoubtedly one of great gravity?
3.39 p.m.
THE PARLIAMENTARY SECRETARY, MINISTRY OF TRANSPORT (LORD LUCAS OF CHILWORTH): My Lords, I trust that it will be for the convenience of your Lordships if I intervene in this debate at this juncture to try to reply to the speeches which we have heard from the noble Lord, Lord Balfour of Inchrye, and the noble Viscount, Lord Samuel. I would ask your indulgence if I leave to my noble friend Lord Pakenham the more fiscal side of this debate, and those remarks of the noble Lord, Lord Balfour, which I think might justly be placed into the electioneering category —in other words, for my noble friend the éclairs of this debate; for me the bread and butter.
For once the noble Viscount, Lord Samuel, was wrong. My introduction is going to be that neither the noble Lord, Lord Balfour of Inchrye, nor the noble Viscount, Lord Samuel, has a monopoly of concern in this matter. His Majesty's Government are as deeply concerned as noble Lords opposite at the rises in prices, but I suggest that the rise in the cost of living cannot be considered out of the context of the general economic problems with which this country has had to grapple —in a large measure successfully—since 1945. Rising prices, I am prepared to admit straight away, are on the whole undesirable. But it does not follow that a low and falling cost of living is necessarily good, especially if it is followed by and

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carries with it depression and a large measure of severe unemployment. That was our experience of a low cost of living in the inter-war years. It is useless for people—I have heard this done, though I do not accuse Lord Balfour of Inchrye of doing it—to compare the purchasing power of the pound in 1950 with the purchasing power of the pound in 1930. We had 3,000,000 people standing in unemployment queues in 1930, and those people had not a pound to spend, whatever the prices were. Another matter to which I think I may properly draw your Lordships' attention is that the prices of goods and services are the incomes of those who make and supply them. I believe that what is worrying the housewife to-day is not so much the cost of the article but the amount of money which she has in her purse to buy it.
LORD LLEWELLIN: It is the same thing.
LORD LUCAS OF CHILWORTH: If the noble Lord will allow me, I will come to that point in a few minutes. Lord Balfour of Inchrye presented to your Lordships a profit and loss account which, if I may say so with respect, I thought was a little lopsided. It set out fully the expenditure side but was not much concerned with the income side. That is something with which I intend to deal in a moment. It seems that the noble Lord's first criticism was that the interim index of retail prices is not very good. I thought he rather jumped about, in his comparison of prices, from 1945 to 1938. I could not make out why he mentioned 1938–perhaps it was in order to embellish his argument. I intend to stick to the prices in this index, because, as the noble Lord rightly said, this was altered in 1947, and altered after consultation with a number of bodies, including representatives of employers, trade unionists, the co-operative movement, retail distributive trades and women's institutes.
Following the recommendation which was made there was set up the Cost of Living Advisory Committee. The components of this present index, which is used for the purpose of measuring variations in the cost of living, are very wide. They include an enormous number of things, among them that article mentioned
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by Lord Balfour of Inchrye in which all young fathers of newly-born babies are naturally very much interested. In this index it is called a "nursery square." Also included are radio sets, entertainment, entrance to cinemas and football matches. Even whisky is included, as alcoholic drinks come in it. I would suggest that if your Lordships would possess yourselves of this very informative booklet—the title is Interim Index of Retail Prices, Method of Construction and Calculation—which has just been issued by the Ministry of Labour you will see how the index is arrived at, how the figures are weighted and how the averages are worked out. And I think you will find that it is very fair. What are the figures? They say that between 1945 and 1950, retail prices have gone up by about 23 per cent., that is to say, from 1945 to January, 1950, the index figure has gone up from 100 to 123.
LORD BALFOUR OF INCHRYE: My Lords, this is a very important question. I should like to get the matter clear. As I understand it, the Board of Trade index was broken down and re-started on a new basis in 1947. The reason I took the London and Cambridge index was that it is the only continuous one that runs on a common basis from 1938 onwards. The figure which the noble Lord is now giving, he says, is the Board of Trade figure for 1945. Is he speaking of the Board of Trade index as prepared in 1945 and subsequently altered in 1947, or on a 1947 basis, as it were jobbing back to 1945?
LORD LUCAS OF CHILWORTH: My Lords, it is an amalgamation of both, but is on a broader basis, and it includes a number of other items. There has been an enormous enlargement, as noble Lords see.
VISCOUNT SAMUEL: Is it the same basis as the 1950 figure.
LORD LUCAS OF CHILWORTH: Yes.
LORD DE L'ISLE AND DUDLEY: Does it contain all the old elements.
LORD LUCAS OF CHILWORTH: Yes, plus a lot of new ones.
LORD DE L'ISLE AND DUDLEY: Including red flannel material?
LORD LUCAS OF CHILWORTH: Not being interested in red flannel, like the noble Lord, I did not look to see if it was included. I expect that it is.
LORD DE L'ISLE AND DUDLEY: It was in the old one.
LORD LUCAS OF CHILWORTH: Your Lordships may be interested in these figures. I put them forward rather tentatively, for I want to be fair, and a basis of comparison is not easy to arrive at. These are some of the increases in retail prices in other countries over the same period—that is the period from 1945 to the end of 1949. In the United States, it was 31 per cent.; in Canada, 36 per cent.; in France, for food only, 410 per cent.; in, Italy, 69 per cent. The only comparable figures which are below ours—and they are certainly well below—are the figures for the Scandinavian countries. For what it is worth, I suggest to your Lordships, that the rises in retail prices in this country are smaller than in the vast majority of countries in the world.
Let us now consider the reasons for these increases. The first one, I suggest, is the rise in the level of world prices of raw materials. The second is the rise in the level of industrial wages—including wages in the distributive trades. That should go on the other side of the account. I must confess that I was considerably surprised that the noble Lord, Lord Balfour of Inchrye, was so markedly silent on the question of wages. I do not see how we in your Lordships' House can discuss intelligently the cost of living unless we include some consideration of wages. Then the third factor I would put forward is that in some respects the rise in the cost of living has been due to the removal of subsidies. I know I shall have 100 per cent. support from noble Lords opposite in the policy of reducing subsidies and I will indicate how they have been reduced. The noble Lord, Lord Balfour of Inchrye, suggested only two ameliorations in the cost of living, the removal of purchase tax and the cutting of Government expenditure—in what directions the noble Lord, following tradition, was notably silent.
When we look at the level of world prices, we have to take into consideration the inflationary position all over the world. This is one of the prices we are paying for a world war, and we cannot
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escape it. The pent-up demand has induced world inflation. I should like to give your Lordships a few figures to show its effect. The United Kingdom import prices rose by 35 per cent. between 1945 and 1947 and by another 18 per cent. by April, 1949, which meant a total of 53 per cent. from 1945 to April, 1949. In 1949, the index figure of import prices for the United Kingdom was 24 per cent. above 1947 and about 67 per cent. above 1945. I will be frank with your Lordships. The latter was the effect of revaluation—and I make no bones about it. I should like to give your Lordships two instances of how sharply this has moved against us. The index for raw cotton, taking the figure for 1945 as 100, was 252 in February, 1950. For raw wool, the index rose from 100 in 1945 to 293 in February, 1950. But in order to keep this in true proportion we should not lose sight of the fact that higher prices of sterling raw materials mean higher dollar earnings for the sterling area so that it is not altogether a debit. The noble Lord asked me what was the increase in the cost of commodities due to revaluation.
OBLE LORD: Devaluation.
LORD LUCAS OF CHILWORTH: No matter what you call it it is the same thing. This question is difficult because it depends so much on the raw material content of articles; but we may take it that the average raw material content comes to about 12½ per cent. I think your Lordships will be interested in these examples. I worked out what the effect would be on two common articles—a pair of sheets and al ordinary shirt. I hope your Lordships will forgive me if I read the figures out because they answer so many of the questions asked by the noble Lord, Lord Balfour, and the noble Viscount, Lord Samuel. Take a pair of sheets where there is a much higher raw material content than labour content. The raw cotton before devaluation represented 25.49 per cent. of the cost; spinning,. 11.32 per cent; weaving, 18.84 per cent.; bleaching, 5.19 per cent.; hemming, 1.55 per cent.; convertors' margin, 8.01 per cent.; wholesalers' margin, 9.61 per cent.; and retailers' margin, 20 per cent. After devaluation, these figures were approximately the same, except that the cost of the raw cotton went up from 25.49 per cent. to 30.54 per cent., which means that the result of devaluation was to raise the— retail selling price of a pair of utility

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sheets by 12.5 per cent., or 5s. 10d. per pair.
The current retail price for the best utility poplin shirt with collar attached is 26s. 9d. The cost of the cloth because of devaluation rose by 1½d. a yard, from 4s. 4½d. to 4s. 6d. a yard. It takes 3⅓ yards to 3½ yards of cloth to make a shirt, so that the price went up 8d., or about 3 per cent. An increase of between 3 per cent. and 12.5 per cent. on a very large variety of manufactured goods is the effect of devaluation on prices. I cannot tell your Lordships when the effect is going to be felt by the consumer. I know that many noble Lords, with their wide experience of manufacturing, know that it takes about six months for a raw material cost to filter through to the retail price.
That is the position on costs, and now I turn to the income side of the profit and loss account, which I suggest the noble Lord ignored. Wage rates have increased by 23 per cent. between 1945 and January, 1950. The average weekly earnings in manufacturing and certain other industries rose from 96s. 1d. in July, 1945, to 121s. 9d. in October, 1949, which is an increase of 27 per cent. In some industries the increase was much higher than 27 per cent. For instance, in coal mining the weekly cash earnings went up by 46 per cent. between these two dates. The fact is that the income of the workers judged in terms of wage rates has kept step with the increase in retail prices, while earnings are a fraction ahead of it. We have also put into the scale upon the side of income the greatly increased social benefits and social services which make real incomes more real. We cannot ignore them.
LORD LLEWELLIN: Does the noble Lord's figures of earnings deduct contributions to Health Insurance?
LORD LUCAS OF CHILWORTH: No, I am taking pay packet earnings.
LORD BALFOUR OF INCHRYE: Overall pay packet earnings? The noble Lord accused me of ignoring wages altogether. In fact, I told the House of 180,000 railway workers whose earnings are under £5 a week. It seems to me that it is to the lower income group that he ought to pay attention, and not so much to the overall figures he has been giving.
LORD LUCAS OF CHILWORTH: I do not wish to dissect every single industry. I could no doubt find one industry where earnings are twice that amount. I now come to the class of low fixed incomes which the noble Lord mentioned. I admit this is a difficult problem, and we are concerned about it. But it is only fair to say that increases in old age pensions, to take one example, have been substantial since 1945 under the Labour Government. In the case of war pensions, forty-seven improvements have been made, not only in grants but in the amounts. In the case of fixed income groups, again we cannot leave out the effect of the social services and food subsidies which also benefit the fixed income group. His Majesty's Government have this question well in mind. I can assure the noble Lord that we do believe in some kind of equality, and this problem will continue to exercise the minds of both my right honourable friends the Chancellor of the Exchequer and the Minister for National Insurance.
Let me now come to the third reason for increased costs—subsidies. As the noble Lord, Lord Balfour, knows, we have removed the subsidies on utility household cotton textiles-1 think it was in June, 1947. That meant an increase in the manufacturers' prices ranging from 20 to 60 per cent. At the beginning of 1948 we removed the subsidies on utility cotton apparel cloth, utility wool cloth and leather. This resulted in an increase in the manufacturers' prices of 40 to 50 per cent. in the case of cloth and 27½ per cent. in the case of utility footwear. But owing to the operation of price control and margin control, the prices to the consumer did not go up by nearly that amount. In the case of footwear, by some odd coincidence the price did not go up at all. I can only think that perhaps it was because in footwear there had arrived that healthy relationship between supply and demand which was such a feature of the speech of the noble Viscount, Lord Samuel. Competition had at last entered into footwear selling, and as soon as competition entered there was no increase in price. I will return to that subject in a moment. The Board of Trade, by price control and margin control, do try to hold down prices. But I freely admit to the noble Viscount, Lord Samuel, that any price control, whether it is operated by the Government or any

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other outside agency, always tends to make prices higher than they would be if, let me say, the fair wind of competition blew over them.
I come now to the question of bulk buying which I am surprised the noble Lord, Lord Balfour, did not touch upon—perhaps he left it to one of the other speakers—namely, the question of bulk buying. I want to prove to your Lordships that in bulk buying the Government have made a substantial contribution towards keeping down the cost of living. First, bulk buying must be a feature of the Government's policy to ensure that we can make some inroad into our dependence on dollar countries, which has hamstrung us for so many years in the past. Further, bulk buying is essential while we have food rationing in this country. In effect, the Government contract with the people of this country to supply food against the ration, and therefore they must see that they can obtain the food to fulfil that contract. I want to give your Lordships one example of the wisdom that has actuated the Government policy in bulk buying—I refer to the Canadian Wheat Agreement. In 1946 we entered into a four-year contract with Canada for the purchase of wheat. In the first two years the contract price was 1 dollar 55 cents per bushel. During that time the Chicago price was from one-and-a-half times to twice as much, and reached as high as 3 dollars a bushel. For the third and fourth years we have been paying Canada 2 dollars per bushel for wheat, and we are still appreciably below the Chicago price, which is to-day 2 dollars 50 cents. When I tell your Lordships that in the first two years we purchased from Canada 160,000,000 bushels of wheat, and in the third and fourth years 140,000,000 bushels, your Lordships will see the wisdom and foresight of entering into that contract, and what it has saved the people of this country.
LORD DE L'ISLE AND DUDLEY: Would the noble Lord agree that there is an element of gift on the part of the Canadian people in that price?
LORD LUCAS OF CHILWORTH: Not one scrap; it was a hard commercial bargain. I could say something to your Lordships on the question of Argentine meat contracts, but in view of recent happenings perhaps discretion had better take
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the place of valour. I would impress upon your Lordships that these long-term contracts have enabled us to switch our purchases to non-dollar countries. I would ask your Lordships to give serious consideration to that point. We have been forced to switch these purchases, and in some cases we have had to pay slightly more on our contracts than we should otherwise have paid. But what was our alternative? We have to ensure supplies, and we have to give our Colonies and the Commonwealth some encouragement to supply us with food in future, which otherwise we should have to buy from America. Surely that must be taken into consideration. On this question of bulk buying, let me say this. Bulk purchase will be taken from Government account and transferred to private account as soon as we are assured that it is in the national economic interest so to do. We have no doctrinaire fetish over this. My right honourable friend the Lord President of the Council has made that clear in many statements over the past years.
After listening to the noble Lord, Lord Balfour, make one of his charming attacks on His Majesty's Government, I feel that I am entitled to ask him: What is industry's responsibility in this? Can any of these increases in the costs of materials he absorbed by greater efficiency? As tae noble Viscount, Lord Samuel, so properly asked: What is industry doing to mitigate the position by greater efficiency? Surely, the function of management in industry is not just passing on increased costs to purchasers. There is something more in the skill and the art of management than that. If not, then fourteen-year-old schoolboys armed with ready reckoners could be managers. I suggest that a lot could be done. In talking to industrialists I have been appalled at the alibis put forward. Take, for example, the five-day working week. That has been blamed by a lot of industrialists for a short-fall in production. I was interested the other night to listen to a broadcast to Denmark by a prominent industrialist—I think one of this country's most enlightened industrialists—Sir Charles Bartlett. This is what he said on the subject of the five-day working week:
"They produced in the first week going on to a five-days basis 12½ per cent. more than they had on any other five days, and we got the same output in five days. Now since we

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have done that many things have occurred which show rather enlightening shafts on that problem. Our sickness has gone down very sharply. Our absenteeism is almost nil, and one way and another our people are unmistakably better off for working the five-day week. And we have not lost production by it. Since we introduced it our production per person has moved up steadily and is still moving up."
I thought that, coming from an industrialist, might be of interest to your Lordships.
The noble Viscount, Lord Samuel, mentioned the cotton industry as an example of one industry where we could expect greater efficiency. Has any industry received more encouragement from the hands of my right honourable friend the Chancellor of the Exchequer than the cotton industry? Let us look at the position. In 1946, when he was President of the Board of Trade, he went to the cotton industry and said: "I will give you 25 per cent. of the cost to you if you will re-equip and modernise the weaving side of your industry." What happened? Practically nothing. Suspicion was immediately aroused on the question of grouping. They said: "This will be a failure because grouping will be unpopular." It has not been a failure, for in the passage of time about 60 per cent. of the spindles are grouped. But it is now 1950, and while the President budgeted for £10,000,000 to £12,000,000, as the Government's contribution to the cost of re-equipping the cotton industry, in the event only a quarter will be expended. What the noble Viscount, Lord Samuel, said about the cotton industry is true. It is no exaggeration of language to say that it needs to shake itself up.
I could cite the same sort of thing about the clothing industry. May I recall to your Lordships' memories the debate we had about that? I have no doubt that the noble Lord, Lord Balfour of Inch-rye, will remember it. In 1943 the clothing industry set up an industrial committee of its own, and invited Mr. Russell Vick, K.C., to preside over it. That committee came to certain conclusions as to what was necessary to help to put the industry on a sound basis. Nothing was done. Seven years passed in footling around—and immediately His Majesty's Government want to put in a development council and give the industry statutory powers to organise itself we
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have a real storm. If industry took some heed of its responsibility and, instead of trying first of all to remove the mote from the Government's eye, removed the beam from its own, it might encourage us a little more.
The noble Viscount, Lord Samuel, then went to the heart of the subject: What is the effect on the cost of living, and what is the effect on commodity prices of restrictive practices, price rings and price protection associations? If the British public knew how it has been—I find it difficult to use a moderate term—exploited for so many years, I am sure that they would rise in their wrath. Competition in a whole host of everyday commodities disappeared in this country years ago. No housewife can buy a proprietary packed food at other than one price. Let her try to buy a tin of proprietary cocoa, or any proprietary food, at any shop, and she will pay the same price, whether she buys it in the largest and most efficient store in the town or in a shop in the meanest back street. The economies of the efficient shop are not passed on to the public. That is one of our greatest problems. Look at the numbers engaged in retail distribution. They have gone up from about 1,514,000 in 1945 to over 2,000,000. The figure is just about the same in 1950 as it was in 1939.
The noble Viscount, Lord Samuel, quoted my right honourable friend the Minister of Health as saying in another place the other day that, by cutting out some of these unnecessary intermediaries, they have been able to save £2,500,000 on their purchases of requisites for hospitals. He spoke, too, of patent medicines—he gave examples with which I will not weary your Lordships—boosted by advertising based mainly on the thesis that it is very easy to part fools and their money. That is another thing which adds to the cost of living. I myself can quote a report, for which I had some responsibility, on the working of the Agricultural Marketing Acts. I will quote only this one sentence:
"… it is quite a common thing for the price of lettuces to fall from 6d. to a ½d. in a matter of hours. Sudden falls in the wholesale prices are seldom passed on to the consumers by retailers who find it more profitable to sell a smaller quantity at a larger price, and therefore the price mechanism does not operate to expand the demand of the ultimate consumer in circumstances of glut."

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The noble Viscount was right. To-day, prices are higher and discount margins are the same, so profits are higher, and an enormous amount of money is being made in the distribution of essential commodities to the British housewife. That is one of the real reasons why the cost of living stays so high.
The noble Viscount, Lord Samuel, asked me about the Monopolies and Restrictive Practices Commission. He has explained—and. I am grateful to him for saving me the time—the set-up as it is to-day. He asked me: Is it the right machine? Is it too slow? Well, it is at least an attempt to deal with a problem in a way 'which has been advocated since 1922, when the Linlithgow Report drew public attention to the high cost of distribution, and these locust years have been wasted. This is a gigantic job. It is a new departure for this country. I am not possessed of all the patience in the world, and so I think the present procedure is, and is likely to be, a bit slow. I do not think the Commission, as at present constituted, will be quick enough to do the job which the noble Viscount envisaged. But we shall all be in a better position to judge whether that forecast is right or wrong by about the middle of the year, when the Commission produce their first report. These sample activities mentioned by the noble Viscount are only to test the machinery: for them to get a suitable organisation together; to find out what difficulties they are up against—and, as the noble Viscount says, in trying to fight lamp rings and things like that, we are up against a considerable task. I think we can leave it and see.
After the report of the Lloyd Jacob Committee, my right honourable friend the President of the Board of Trade went to industry. He went to the Federation of British Industries because in the Lloyd Jacob Report on resale price maintenance, one of the recommendations was this:
"We recommend that appropriate Government Departments should invite consultations with the principal national organisations of trade and industry, to consider the most satisfactory means of ensuring that this policy is made effective."
Accordingly, my right honourable friend approached the Federation of British Industries and asked for their full co-operation. If I were to say that the reception he received was cool, I should be guilty of a gross under-statement. My
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right honourable friend is now consulting direct with the multitude of trade protection associations, and I can give the noble Viscount an assurance, and these associations a warning, that unless they fully co-operate to put right some of these glaring abuses, then His Majesty's Government will not have the slightest hesitation in taking the appropriate action.
I am now encouraged to believe that in doing so we should have the wholehearted support of noble Lords on all sides of your Lordships' House. I am encouraged not only by the speech of the noble Lord, Lord Balfour of Inchrye, today, but also by the fact that in the Conservative Party manifesto The Right Road for Britain, we read this paragraph:
"Through the powers of the Monopolies and Restrictive Practices Act, we shall see that the public interest is protected and that prices are not kept up either by inefficiency or by combinations in restraint of trade."
And the Liberal Party Manifesto, No Easy Way, says approximately the same thing. And so, if my right honourable friend, supported by His Majesty's Government, finds it necessary to introduce legislation to do away with the evils to which the noble Viscount, Lord Samuel, has drawn attention, I am happy now in the thought that such legislation will fall into the category of the non-controversial.
4.23 p.m.
LORD HAWKE: My Lords, I want to approach this problem in the first instance from the angle of personal savings. Rising prices can affect savings from two different angles: they can make for sheer inability to save, and they can make for lack of confidence in the future value of money and, therefore, of savings. I have taken some figures of personal savings for several years from the figures of the last national survey. In 1938, they were £143,000,000; in 1946, £678,000,000; and in 1947, £165,000,000. In 1948 they had gone down to £6,000,000. The new publication is not yet out, but from the Statistical Digest we can get figures of small savings—which are, of course, included in the totals I have given. They were as follows: in 1938, £49,000,000; in 1946, £517,000,000; in 1947, £165,000,000; in 1948 minus £2,000,000; in 1949, £17,000,000; and from The Times to-day I see that the total this year so far is minus £64,000,000. These figures show that savings by individuals in this country are at present running at a derisory

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total—in spite of the fact that personal incomes, wages and salaries have doubled.
What is the reason? Is it that people feel that saving is not worth-while? I do not think that that applies to small savers, though undoubtedly it may apply up to a point to larger ones, because, after all, you cannot maintain an atmosphere of capital levies, nationalisation and penal death duties without disturbing psychologically the will of the potential victim to save. Moreover, the proof of the pudding to some extent is in the eating: as the noble Lord, Lord Balfour, said, the Chancellor of the Exchequer has given the value of a 15s. War Savings Certificate purchased in 1945 as being only 13s. 10d. now, in 1945 currency value. Therefore purchasers of War Savings Certificates might well, on reflection, consider that they had been rather "mugs" to invest in these things rather than in goods of some sort. But I think that at present people just have not the money to save. It is all very well to say that according to a comparison of the cost-of-living index with the rise of wages and salaries, people ought to be able to save. I must say that I regard that cost-of-living index as a most fallacious document. There is no doubt that this is one of the cases in which "the gentleman from Whitehall knows best." He sits at his desk and does his shopping there, and therefore knows where to buy, where things are cheapest. But the housewife has not that advantage.
I think it is inability to save which is the root cause of this fall; and the reason for that, of course, is that the cost of living has been steadily rising. Why is that? The noble Lord, Lord Balfour, and the noble Viscount, Lord Samuel, have put forward various explanations, and the noble Lord, Lord Lucas, was, I thought at one time, starting to argue what I believe is the Socialist line taken by some Socialist economists—that to achieve full employment or prosperity for the community, you need essentially a rise in wages and prices going on for ever. Then he said that the reason why our prices are rising was because prices are rising in every other country in the world. If those other countries are following inflationary policies, why do we tie our good, sound pound at a fixed rate to their currencies? If they were really
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inflating, our pound would have been rising against their currencies and the cost of living would not have risen in this country as it has done. The noble Lord went on to claim that the policy of bulk buying had kept the cost of living down. No one can prove that, one way or the other, and the noble Lord's argument was irrelevant. He compared prices of bushels of grain in the Chicago market after all the millions of Canadian bushels had been taken off the market, with the price before they had been so taken. It is not comparing like with like. Our instinct tells us that prices are higher, but his examples tell him the reverse. Bulk buying is not a necessary accompaniment to rationing or subsidies. The Board of Trade has carried on rationing of clothing and subsidisation of clothing without a Government agent necessarily having owned the raw material. The noble Viscount, Lord Samuel, thought high prices were largely due to combinations. There is another sort of combination, which I will mention in a moment. I am always a little careful on this subject of combinations. I think it may be that the cause of the downfall of one of the great industries in this country, the cotton industry, was from too strict an adherence to the sound Liberal principles of competition. They killed themselves stone dead between the wars through senseless competition.
What are the other reasons? Of course, devaluation has undoubtedly been a cause, but I believe that the main cause is the high taxation in this country. I believe it is a complete fallacy that for any length of period you can take 40 per cent. or more of the national income in taxation. If you attempt to do so, the national income just blows up like a balloon and that quantity of taxes becomes a smaller percentage of the whole. I think I am supported by some of the economists in this theory today. Now that the national income has got this ballooning tendency, there are very heavy wage demands all over the industrial field. They are kept under only by some of the weightiest men in His Majesty's Government sitting on the safety valve. What I believe is required to-day is an entirely new approach to the Budget. The old approach of His Majesty's Government—" How much money must we have?"—I think is obsolete. We want a new, more scientific and planned approach. It is not the first time in your

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Lordships' House that I have suggested to a Government of planners that they should plan. They must say to themselves, "What is going to be the national income, and what is the largest percentage we can take of that national income without further inflation?" They must then decide what they can afford to do with the proceeds of taxation.
Undoubtedly, they will have to take some unpleasant decisions. They will have to make economies; that is inevitable. I suggest that, in the first instance, they should aim at what I call cumulative economies—that is, economies in Government spending which may be immediately reflected in corresponding economies in the private sector. What I mean by that is that when there is one controller in Whitehall there are many controlled people distributed round the country. If there is one form demander, there are many form fillers; so if we get rid of the controller and the form demander, we are enabling industry to reduce its overhead charges correspondingly. I do not believe that more than the merest handful of controls over industry are really necessary to-day. Controls, which are another form of combination, probably more vicious than any spontaneous one, are the feather bed of industry. They make it easy for the most inefficient. They fix prices, and the maximum price becomes the minimum price. If we can get rid of those controls, not only will Government staff be decreased but there will be more competition within industry which will force industry to prune its own overhead charges.
In addition to controls, there have been other overhead charges which have grown up in recent years consequent on the cost-plus result of taxation and profligate post-war Government finance. Press, public relations and statistical agencies abound everywhere in Government circles and in industry. I doubt very much whether they are really pulling their weight. The layman, even one who has served in Whitehall, has great difficulty in understanding how the Departments can need the number of people that they have to-day. Is it necessary that the Service Ministries should have one man in Whitehall for every seven men they administer in the field? Moreover, many of those seven men are themselves administrators, sitting at desks. The Services,
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including their Ministries, must be simply riddled with administrators. I feel that there is a wide field for economy there. The other Ministries, of course, have staffs at least appropriate to their functions, and if you want to get rid of the staffs you a must prune the functions. It is noteworthy that the Board of Trade, which has always been a model of efficiency and good administration, seem to have a very moderate staff compared with some of the more mushroom war-time Ministries.
However, the main point is that His Majesty's Government must reduce the functions, and then they can start reducing the staffs. Perhaps the noble Lord, Lord Pakenham, may not agree with me when I say that I cannot see why the Ministry of Transport should not swallow up his Ministry, the Ministry of Civil Aviation. Nor do I see why the Ministry of Works should not revert to its old-fashioned idea of merely looking after Government buildings. Nor is it easy to see why the Ministry of Fuel and Power need so many people just to administer the fuel and petrol rations: they have hived off the three main industries into bureaucracies of their own. Surely, they are not, in their own office, maintaining a close control over those as well. There are many more economies on that line which can be made.
The National Health Scheme is a wonderful idea. That no man should suffer because he cannot afford treatment, and that no man should fear crippling bills from doctors, is a magnificent idea. It is one that I have had for years. But to fulfil that idea it is not necessary that all treatment should be free. I cannot help feeling that the time has arrived when patients should make a contribution commensurate with their means. It should be done by the users of the scheme, not by all and sundry. If we add to the poll tax—that is, the National Insurance stamp card—we are merely imposing a further tax burden upon the community.
By a programme of simplification of this sort and by the most careful economy in capital expenditure on everything except housing, I am absolutely certain that the Government could make very substantial savings, and I feel that that should be passed on straight to the consumer. The view which has been advanced by the Liberal Party—that there should be a big surplus in the Budget—is, to my mind,

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completely unsound when we are faced with rising prices, and so on. In any case, I would never trust a surplus in the hands of a Government which contained the present Minister of Health. There would never be a surplus at the end of a year.
I started from the savings angle and I return to it. I do not think the situation is yet catastrophic, but it is definitely symptomatic, and unless we restore the ability to save we may find that all investment saving will die from disuse. Then there is a danger that it may be replaced by a movement from currency into material goods which may even be outside this country. That, of course, would lead again to devaluation. There is already talk of this in some foreign countries, and of the break-up of the sterling area which would be quite disastrous. His Majesty's Government inherited the tradition of a strong, sound pound sterling. That was achieved by successive generations of Governments providing careful finance, and by the traditions of the British people, too. As the banker of the sterling area, it is the business of the Government to maintain that tradition, and it is part of their duty in doing so to give attention to the question of the vicious circle of rising prices and rising wages which looks like breaking out in this country to-day.
4.41 p.m.
LORD PETHICK-LAWRENCE: My Lords, the debate which is taking place to-day has certainly been interesting, and we are greatly indebted to the noble Lord, Lord Balfour of Inchrye, for bringing this question to your Lordships' attention. But I venture to think that in some respects it has been an attempt in the more polite and courteous atmosphere of this House to reproduce the polemics of the General Election; and a great many of the arguments that have been produced from the Benches opposite have been those which we heard, less politely and more vigorously expressed, at the hustings and the meetings of the Conservative candidates throughout the country.
The noble Lord who has just sat down made a rather remarkable statement which I took down. He said that he would never trust a surplus in the hands of the present Government, and that there would never be a surplus so long as the present Minister of Health was a member of the Government. I do not think I
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have altered in any way what he said. That apparently is his view. If it really is his view there can only be one explanation—that he does not read the figures which appear weekly or annually in the Statement of the National Account, because in fact he would find that, for the year ended March, 1949, not only was there a surplus running into several millions of pounds but the Chancellor of the Exchequer did something which has never been done before, at any rate on the same scale. He not only produced a very considerable surplus above the line, but he also produced a very considerable surplus, running into millions, below the line, which means that after the capital expenditure undertaken by the Government had been taken into account there still remained a margin on the right side.
Pursuing that matter right up to date, every Wednesday we have a statement in The Times showing the precise Government figures for the preceding week. Of course I have not access to them but if my recollection serves me aright, on Wednesday of last week the latest figures showed a surplus to date on the two sides of the account of over £600,000,000.
LORD HAWKE: Above and below the line?
LORD PETHICK-LAWRENCE: I am coming to that. I will give the statement perfectly correctly. In last week's account the surplus above the line ran into something like £600,000,000. I do not carry the exact figures in my mind, and I would not like to be too precise, but I think the surplus below the line was over £200,000,000. That seems to me to be an achievement of which any Government can justly be proud; and it is a very remarkable fact. For the noble Lord to suggest that this Government could never produce a surplus with the present Minister of Health as a member of the Cabinet, seems to be quite devoid of fact.
Then, following upon that, the noble Lord told us that the pound sterling had always been defended, and that it would be one of the duties of a Government of his Party to defend the pound. That may well be true. I remember that several years ago, about 1925 or 1926, that was precisely what Mr. Winston Churchill boasted that he was going to do. He restored the pound to its precise parity

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with the dollar as it had been, and he was glad to declare that he was making the pound look the dollar in the face once more. The consequence of that action of the then Chancellor of the Exchequer was that we had all sorts of evils in this country. It is true that prices began to drop, but in consequence we had vast unemployment, great misery, and if not starvation we did at any rate have malnutrition in the presence of national plenty. Years later, no other person than Mr. Winston Churchill himself admitted that he had made a great mistake in taking that action, and that his officials had over-persuaded him against his better judgment.
LORD HAWKE: I hope the noble Lord is not suggesting that I was proposing that the pound should be up-valued to any fixed level, because I was not.
LORD PETHICK-LAWRENCE: No. What the noble Lord suggested was that his own Party—
LORD HAWKE: All Parties.
LORD PETHICK-LAWRENCE: —were the Party that kept up the value of the pound. I am agreeing with him. I say that his Party have been the Party who have kept up the value of the pound.
LORD HAWKE: Excuse me, I did not say that. I said that all Parties, successive Governments, had maintained the value of the pound.
LORD PIETHICK-LAWRENCE: That may be so, but I thought the whole point of the noble Lord's criticism of the Labour Government at present was that they had not kept up the value of the pound. If the noble Lord says that all Parties did so—
LORD HAWKE: In the past.
LORD PETHICK-LAWRENCE: As a matter of fact, it was the Conservative Government, headed by the then Chancellor of the Exchequer, Mr. Winston Churchill, who restored the value of the pound to its pre-war parity. And the point I am making is: at what price did he do it! He did it at the price of the people of this country; and he himself admitted later that his action on that occasion had been injurious, and that he had taken it against his own opinion because of the advice given him by his officials.
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We all know that prices have gone up in this country; we all know that there is a shortage of purchasing power; we all know that there are difficulties arising from queues and rationing. But the question about which we differ is whether the present Government are deserving of the support of the country for their attitude towards these difficulties. In every country there have been rises in price; in every country there are sections of the population who find it difficult to live on their means. But I would maintain, taking it as a whole, in these respects the people of this country are better off than those in other countries of the world. Noble Lords in times gone by, and members of the Conservative Party in particular, have pointed out how much better off people were in the United States than in this country. It would not be in the least surprising if they were because the United States never suffered either the physical material losses which the people of this country suffered during the war, or the loss vis-à-vis foreign countries that we suffered. But in a debate that we held in this House about three or four weeks ago I was able to give some surprising figures of the position of the people of the United States at the present time. I showed that, so far from their being so very well off and contented, large masses of them were in great difficulties. I have had the opportunity of presenting my figures to others who have come from the United States, and in almost all respects they have been substantiated by what I had been told.
In this country the middle class are the class who complain most of what the Labour Government have done (I do not altogether wonder at them; certainly they are not as well off as they were before the war) but it is clear that the middle class in the United States are no better off. Large numbers of people in that class over there have the greatest difficulty in making ends meet. Therefore, what we suffer from in this country is not due to the particular sins of the Labour Government, but is due to the unfortunate results of the war, in which large masses of the world's substance were destroyed and in which we in particular, standing alone as we did, suffered frightful capital losses. Our main sources of income from all over the world were lost, and in place of them we incurred a net debt of something like

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£3,000,000,000. It is impossible for such things to happen without suffering to be caused, without prices going beyond purses, without the people of this country having to put their shoulders to the wheel and to strain every nerve in order to make the carriage of State go up the steep hill on which it is travelling in these post-war days. This country has done magnificently and, under the wise guidance of the present Government, has gone a very considerable way to recovery. Let me quote one or two figures in support of what I am saying. Production has risen more steeply in the last few years than it has ever risen before in the history of the country. It is now something like 30 per cent. above the pre-war standard. Capital investment—a very striking guide—has been at the rate of £2,000,000,000 a year, and it goes in matters of great value to the country. It goes in farms, industrial equipment, factories, machinery and transport. And it not only goes in those material forms but it also goes in human forms, which after all are the most lasting things that affect a country.
The noble Lord criticised, not, it is true, the principle, but the working of the National Health Services in this country. I notice that members of the Party to which the noble Lord belongs, often seem to want to have it both ways. They say: "We who sit on these Benches have had a hand in this scheme; you cannot claim any monopoly. We are just as much for the Health Services as you are." When it comes to details, they say: "You ought not to spend so much money there, you ought not to do this, that or the other." In fact, they assert, the whole conduct of the scheme has been wrong. I deny that that is so. I say that the state of the health of the country at the present time is largely due to the way in which the Health Services have been administered. I say that the fact that infantile mortality has been steadily declining until it has reached a record low figure, and the fact that the mortality of mothers in childbirth has come down to its present low figure, are due, first of all, to the effects of the Health Services and, second, to the fact that we have had fair shares. This last, of course, has been the main principle on which the Labour Government have acted. The absence of unemployment,
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which is so largely due to the refusal of the Labour Government to make retention of the exchange value of the pound the main principle of economic policy, has been of lasting benefit, not only to individual people but to the production of the nation as a whole.
Let us now turn to the question of prices. Ordinary retail prices which people have to pay have gone up, but our Government have kept them down to their present levels by food subsidies, by rationing and by controls. Some noble Lords may dislike subsidies; they may say that they are too high, and that they involve high taxation. As a matter of fact, the Labour Government have been preeminent in keeping food prices down by means of food subsidies, and keeping the prices of other commodities down by means of rationing and controls in various instances. Putting food aside for the moment, take the question of petrol. I cannot remember whether it has been mentioned to-day, but one of the criticisms of the Labour Government which members of the Party to which noble Lords opposite belong; are fond of making, is that, whereas in almost every other country in the world petrol is free of rationing, we have retained it here. What has been the price for taking petrol off the ration? What we find, in fact, is that in those countries which have not continued the rationing of petrol, the price of petrol has been allowed to rise phenomenally. Petrol is 2s. 3d. a gallon here; in Italy it costs 5s. 8d. In West Germany the price is 4s. 7d.; in France it is 4s. 4d.; in Norway it is 4s., and in Belgium it is 3s. 11d. In fact, we are selling seven times as much here as is being sold in Italy, six times as much as in West Germany, twice as much as in France, and half as much again per head as in Belgium and Norway. In view of those facts, I doubt whether a great number of people in this country would like to see petrol rationing removed, if it could be removed only by allowing the price to soar so high that many people would be unable to buy it, because of the cost.
The noble Lord, Lord Hawke, reverted, among other things, to the charge that one of the causes of our high prices was bulk purchase. I think he said he "felt it in his bones," or something of that kind. That is a charge that has been levied

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against the present Government by the Opposition for several years, and a great deal was made of it at the General Election. What are the facts?—after all, facts are what really matter, and not what you feel in your bones, or what is the theoretical aspect of the question. The facts are these. This question of prices came before an international body, the Research Division of the Economic Commission for Europe. After examining British prices, and comparing them with prices in other countries, that body came to the conclusion that British prices for purchases from foreign countries were extraordinarily low. This is what they gave as the reason for that:
"The explanation of the relatively low prices paid by the United Kingdom for its imports of food and raw materials appears to lie largely in the extensive use which it has made of long-term contrasts and bulk purchase agreements covering a large proportion of its purchases."
I prefer the considered opinion of that international Commission to what the noble Lord, however eminent and strong he may be, feels in his bones.
I come to the whole crux of the matter. The real cause of high prices and of our difficulties is the war experience. We cannot expect to wage a war, to wage it alone, and when we are standing alone to have our houses destroyed, our capital ruined, the means of existence of our people obliterated, our foreign investments lost and to incur debts all over the world—and then expect after all that is over to he in a financially strong position and have the falling prices and increased profits which we should naturally like. I maintain that, considering all these difficulties, this country has stood up magnificently. Of course, that is not due alone to the policy pursued by His Majesty's Government, but the policy pursued by this Government has prevented the evils which took place after the last war; and it has enabled the magnificent courage and heroism and pluck of the British people to achieve the steady progress of this country towards the stronger position, both materially and in physical well-being, that it had before the war.
5.3 p.m.
LORD DE L'ISLE AND DUDLEY: My Lords, the noble Lord who has just sat down suggested that the noble Lords who had spoken from this side in this debate were repeating their Election speeches. I had not the privilege of hearing the
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part the noble Lord took in the Election, which I am sure was a notable one, hut I heard echoes of very many Election speeches in the remarks that have fallen from his lips. The noble Viscount, Lord Samuel, said he thought that the Government were complacent. Although I expected some complacency on the part of Government speakers, I did not quite expect so persistent a vein of complacency as we have heard from the noble Lords, Lord Lucas of Chilworth and Lord Pethick-Lawrence. The Motion before the House expresses
"concern at the rise in cost of food, clothes and household goods since 1945, coupled with the decline in the internal purchasing power of the pound, affecting the value of wages, pensions, allowances and savings."
So far as I can gather from the speeches of noble Lords opposite, while all have expressed concern, which is what we might expect, they seem to think that they have done pretty well, that on the whole there is not a great deal to worry about, and that the Government can pat itself on the back and everybody can go home happy. I wish I could share that feeling of complacency about the situation; but I am seriously perturbed that the Government should be so complacent as they are. It is all very well to say that the cost of living in France has risen 410 per cent. or that certain people in the United States known to the noble Lord, Lord Pethick-Lawrence, are suffering from the results of inflation. As the noble Lord, Lord Hawke, has justly pointed out, there is no country in the world which is more dependent for its international trade and its place in the world than this country. If it is to remain a trading nation and the banker and centre of the sterling area, it must be our concern to safeguard the pound sterling.
I do not know whether the noble Lord, Lord Pethick-Lawrence, preferred to misunderstand the purposes of the argument. He took us back to Mr. Churchill's period of office at the Exchequer and said that because in his view a mistake was made in revaluing the pound upwards, we must be content now that the course of the pound during the past live years has been downwards. That seems to me a form of inverted logic, but perhaps my apprehension is incomplete. By a singularly perverted logic, what was at the time regarded as a very serious step on the part of the Government, the devaluation

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of the pound, has now almost become a cause of merit, a matter of duty rather than a step forced upon a reluctant Administration. I remember the noble Viscount the Leader of the House declaring, almost with his hand on his heart, that the Government would never take so rash a step. The devaluation of the pound was a disaster and we on this side must hold the Government responsible, at any rate in part, for the causes of that devaluation.
I hope not to detain your Lordships very long. In these debates on economic subjects the long experience and wide knowledge of many of your Lordships have given to these discussions, and I hope will continue to give, a value which has won a wide recognition. If sometimes more pedestrian and less brilliant minds like mine try to make a contribution, I hope the darkness of our ignorance will be a background to the brilliant stars. I think it will be agreed on both sides that the cost of living has risen, is rising and, at any rate in theory, ought to be diminished; but there is a difference about the proper methods of reducing the cost. The only perturbing element is that some noble Lords on the other side do not seem so gravely concerned about this as I think they ought to be. Certainly no Party advocate higher prices for consumers as a deliberate policy. Certainly no consumer enjoys paying more than formerly for goods, and no shopper, least of all the feminine shopper, enjoys getting an inferior article at the same price.
On the other hand, almost everybody enjoys the sensation of having rather more money in purse, pocket or bank, that he can spend. Therefore, it is not surprising that the advocates of better pay, of what in the modern genteel jargon of politics is called "higher personal incomes," should receive a favourable hearing. But, as every schoolboy knows nowadays, you cannot get more into a pint pot than a pint pot will hold, and you cannot get a larger share of the national cake without depriving somebody else of his share unless you make the cake larger. We have had that preached to us in pulpit and on platform on many occasions. But I am afraid that intellectual apprehension of this rather and doctrine is one thing and the actual submission of the individual will to self-denial is quite another. It is not that
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men and women do not want to get a little more pay—probably by working harder and longer—but that they have an understandable eagerness to retain that extra money they earn, and a grave dislike of paying it away in taxes. So, in my humble view, while the general public think there is money to be got, I am afraid that in varying places there is likely to be a spiral of rising wages and prices. I think that is what was feared in the Statement on Personal Incomes and Prices issued by the Government in 1948. It says:
"Moreover, experience has shown that, when it comes to a race between rising prices and personal incomes, prices will always win in the long run, so that conditions become progressively worse for the holders of all personal incomes but particularly for the wage earners."
Therefore, if I may say so in passing, I was rather surprised to hear the particularly complacent (as I thought) remark of the noble Lord, Lord Lucas, when he seemed to prove to himself, and perhaps to members of his own Party, that people in 1950, certainly in the wage earning class, were not worse off but better off.
THE MINISTER OF CIVIL AVIATION (LORD PAKENHAM): Better off than when?
LORD DE L'ISLE AND DUDLEY: Better off than in 1945. I accept the correction of the omission in my statement. For nineteen years or so we have been enjoying what I believe is called a "managed currency." I am inclined to think sometimes that this is a euphemism. At any rate, the volume of credit and currency has since 1931 been varied by deliberate action on the part of the Government rather than in obedience to any changes in the country's reserves of gold. Nineteen years is not a very long time in the history of our country, and during six of those years the country was at war. Despite the despondent views of noble Lords opposite—because it was about that period that they were in the Opposition—between 1931 and 1939, taken as a whole, there was a period of rising employment, increasing international and imperial trade and an advance in the real value of wages. Then came the years of the war, which were clearly exceptional years. For various reasons war, as we readily acknowledge, always brings in its train strong inflationary

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forces, but I think we ought to remember when we recall this period that those inflationary forces were to a great extent mitigated by the successful savings movement, with which the name of the noble Lord, Lord Kindersley, is so intimately associated.
I want to be fair, and I admit right away that inflationary tendencies, once set in train, are difficult to halt. The habit of spending with few questions asked is easily formed by the great Departments of State, and much less easily checked—although I must admit that I was rather shocked to read in a debate in the other place that the Chancellor of the Exchequer seems to think that he has not yet been able to check this habit after five years. Moreover, there are great claims to be settled, international trade to he revived, and internal balances to be arranged. But the measures to deal with these problems, and the speed with which they are dealt, are matters within the sphere of governmental responsibility. As we have abandoned the practice and have been taught to hate the theory of the automatism of the old gold standard, a special responsibility rests on the Government, in my view, for the management of our currency and thus for the course of prices and the value of savings.
The fact that the Government possess such an immense power over the lives and fortunes of the citizens of this country as their control of money and credit implies, is in theory a source of strength. But it is of the greatest importance in a democratic country that everyone should know the inherent weaknesses of the rulers as well as their virtues, real or supposed, for these are bound to be loudly extolled. I have spoken of the natural inclination of the great majority of our kind towards a little more money in the pocket to burn. In my view, it takes a determined Government—I freely admit this—to resist these inclinations, especially when it is fairly generally realised that it is pretty easy to create extra money. If the Government are not determined, they will speedily find themselves at the mercy of people with all sorts of demands to spend money, very often on objects which are in themselves highly desirable, politically or socially. A Government who are not determined will readily find close at hand the strongest possible objection to cutting
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down public expenditure. We all know in our private lives—and it is the same in public life—that this is very disagreeable.
THE LORD CHANCELLOR: Hear, hear.
LORD DE L'ISLE AND DUDLEY: I am glad I carry with me the noble and learned Viscount wino sits upon the Woolsack. Fortified by his sympathy, if not by his support, I hasten to acid that economies do entail discomfort and sometimes suffering for particular individuals and sections of the copulation. We all know it is much easier to praise the principles of economy than to enforce them. Last year in his Budget speech the Chancellor of the Exchequer said that we must have a ceiling and no Supplementary Estimates, and that careful regard must be had for expenditure and wise and prudent housekeeping. We now have Supplementary Estimates of a very large character which, to my mind, make nonsense of the so-called programme of "cuts" last autumn Wafted along by a favourable breeze of a sellers' market, by dollar loans and Marshall Aid—indeed, I think, aided in some degree in the export markets in the non-dollar countries by the shortage of dollars—our national economy remains—I was going to say at full stretch, but that would be changing the metaphor too much, and I ought to say under full sail. The old derided, outworn automatism has been destroyed, and there are no buffers. The difficulty over falling reserves is met by devaluing the currency. Apparently great diffidence is felt before the devaluation, but as time goes on we see that it is claimed almost as a victory. So prices are given another hitch upwards. I believe that, conforming to the general practice of the past, we shall see not an avowed abandonment of the wage freeze but what may be called a modification of it. This modification will bear the same relation to the abandonment of the wage freeze as the revaluation did to devaluation.
I am not going to predict—because prediction is always unwise in a politician—whether the disaster which apparently waits for us in 1952, when Marshall Aid runs out, will come upon us or will be diverted by the appearance of another deus ex machina. I do not know whether the crisis can be postponed by yet another

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adjustment—I hesitate to use any other word, in case I am said to be denigrating our currency—of the external value of the pound sterling. But one thing can be positively asserted. The value of past thrift, past abstinence, past efforts for the National Savings Movement—in a word, the value of savings—is diminishing and will continue to diminish as long as present policies continue. At all levels and in all classes, quite continuously during the past five years, it is the interests of the saver which have gone to the wall.
The situation was clearly revealed by the Chancellor of the Exchequer when he gave that reply which was quoted by my noble friend Lord Balfour of Inchrye. The present value of a 15s. savings certificate, with accrued interest, is to-day 13s. 10d. It has often been said, and I think truly, that the public are not fools. Is it surprising that with that knowledge—or if they have no knowledge statistically, with that apprehension—the fall in savings is as fast and as catastrophic as the noble Lord, Lord Hawke, has shown the House to-day? Indeed, what inducement is there for anyone to abstain from expenditure now so that he or his children can enjoy the fruits of this abstinence at a later date? The most remarkable thing is the admirable persistence of the saving habit in the face of such continuous discouragement. I myself—and I think noble Lords on this side of the House—regard thrift as a virtue, and a social virtue at that. I believe it to be an essential part of the fabric of what nowadays is called "the free way of life." I fear that the compact between the past and the future, which is implied when the Government assume without check or hindrance the management of the national currency, will be seen to he valueless.
Although there was some difference on this matter between the noble Lord, Lord Hawke, and the noble Lord, Lord Pethick-Lawrence, perhaps there was only a verbal difference. I agree that the great achievement in the sphere of finance for the past hundred years has been that our policy has created at home and abroad a strong confidence in the pound sterling, and I believe that our great expansion of trade and the foremost place which we assumed in the world largely depended upon that confidence. This feeling of confidence in the pound has certainly been
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severely shaken abroad, but I think that at home, although it has been weakened, it has not yet been shattered. I hope that I have sympathetically pointed to some of the difficulties which faced His Majesty's Government in 1945. I have referred, not too critically I trust, to the inevitable pressure which bears upon a Government who enjoy the power of a managed currency, especially during the period of great industrial activity which normally follows a great war.
But my gravest fears arise from the suspicion, almost amounting to a belief, that fundamentally His Majesty's Government do not really care about the saver, the man who is prepared to go without now in order to advance himself or his children in life, or to make provision for his old age. Certainly aggregrate savings are necessary as a balancing item in the national accounts. If people, despite the discouragement which they have received, are willing to save, so much the better in the view of the Government. They pat them on the hack, and give high praise to the people who manage the Savings Movement. But if people are obstinate enough to prefer spending to saving, then there must be a bigger and better Budget surplus, and a form of centralised saving must be substituted for private thrift.
Although again there was an interesting passage between the noble Lord, Lord Hawke, and the noble Lord, Lord Pethick-Lawrence, in principle I am inclined to the view of Lord Hawke—that a big Budget surplus inevitably encourages the cupidity of the spending Departments who immediately set about helping themselves. We have these great Supplementary Estimates, for which very little explanation is proffered to Parliament. But, as usual, political practice is elevated by the theorists to the status of deliberate policy. Left-wing economists now see a system of continuous inflation, checked by the perpetuation of physical controls, as the proper way of conducting the economy of the collectivist State.
I confess that I see in this thesis—whether it is foresight or hindsight I do not know—no deviationism from the doctrine of Socialism. It confirms my belief that the outlook for the thrifty in the Socialist State is not very bright. It is all the blacker because Socialism, with its programme for the progressive

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acquisition of our industries by the State, substitutes for individual ownership of real things money contracts, in the form of Government stocks, by way of compensation. Even if adequately compensated, the former owner becomes completely at the mercy of the Government who by their monetary policy can value these obligations as they wish. Methods of control of industry which fall short of nationalisation, coupled with systematic dividend limitation—which I see is also advocated in certain Left-wing circles—will also place the former shareholder, the former holder of an equity, completely at the mercy of the State economically.
I have so far spoken chiefly of the saver, and especially of those who hold in one form or another monetary obligations. It cannot be denied that during the past five years Government policy—or the absence of it—has imposed on all holders of Government and other similar stocks a capital tax of perhaps 15 per cent. Similar disadvantages have been suffered by pensioners, and all other persons living on fixed incomes. In many cases the plight of such persons is pitiful. I regard the diminution which is taking place in the value of savings on fixed monetary incomes as a grave matter. It is all the graver because its effects are often not obvious and the sufferers not always vocal. In my opinion it bodes ill for the future, because the discouragement of the disposition of our fellow-countrymen to save will work grave moral as \N ell as economic harm
I have, I hope, made all the allowances which a reasonable member of the Opposition should make for the Government. I hope that I have made it clear that they cannot in the least be held responsible for the inflationary tendencies, which may be regarded as a hangover from the war. But in so saying, I cannot absolve the Government from all responsibility for the events of the past five years. Nor, when I remember the great powers which they had or assumed over the economy of our country, do I think it is fair for them, when things go wrong or when trends are not as they should be, to say, "We cannot help it," and when things go right, to take all the credit. If I may give an example from another sphere, it is all very well to claim the credit for reducing infant mortality
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and then to seek to escape blame for the rise in juvenile crime. They cannot have it both ways.
I hope the noble Lord who will reply, will take the House into his confidence on future Government policy; and I hope that he will recall that he is speaking for the Government and is not there merely to bait the Opposition. On previous occasions he has sometimes found irresistible the temptation to quote extracts from speeches of members of the Opposition to prove to his own satisfaction that they are intellectually inconsistent. He has then closed the discussion, without feeling the necessity to explain in any detail the plans of the Government for meeting the particular difficulty which was the subject of the debate. Meanwhile, prices rise and mart of our difficulties remain unresolved. We are still in the dark as to the Governments real intention deal in a fundamental manner with our grave economic difficulties. We on this side are beginning to be forced to the conclusion that it is not so much the noble Lord's desire to correct the exercises of the Oppositior as a device to conceal the total lack of capacity of His Majesty's Government to deal with the situation. We shall see to-day, from the matter and the manner of his reply, whether the noble Lord still regards twitting the Opposition as a proper substitute for a considered answer to a matter of great public importance.
5.35 p.m.
LORD WINSTER: My Lords, we have listened to many arguments this afternoon but the one which has most attracted my attention came towards the end of the speech of the noble Lord, Lord De L'Isle and Dudley. I understood the noble Lord to deplore the decrease in infant mortality because as they grow up juveniles take to crime; and therefore, I gather, the noble Lord's view is that the more infant lives we save, the greater will be the volume of crime with which we shall find ourselves having to deal. That, I thought, was strongly reminiscent of that delightful book 1984. The one fact which has gone completely uncontradicted this afternoon is that prices have risen and are showing a tendency still to rise. I remember the Chancellor of the Exchequer's broadcast after devaluation when he said that except for a rise in

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the price of bread he did not anticipate any very serious rises in price. I am certain he was completely sincere and was acting on the best advice available. But next morning my village grocer told me that the Chancellor was wrong, and that he himself was absolutely certain that there would be considerable rises in price for many other things. I am compelled to think that in matters concerning rises in the price of food the village grocer is possibly a better guide than the Chancellor of the Exchequer.
The noble Lord who introduced this valuable debate said that the subject was one which affected the life of every man and woman in this country and especially that of every housewife. But I think the noble Lord would be the first to agree that the matter goes deeper than that, and is one which affects very seriously indeed the economic and financial life of this country. I would go so far as to say that these high prices have a certain effect upon the moral life of the country, for there is little doubt that shortages and high prices between them are responsible for much of the serious wave of pilfering which has overtaken this country of recent years. It is now worth while to steal things which at one time had little intrinsic value. No doubt these high prices and shortages are partly responsible for the very serious pilfering on the docks and railways, though I was glad to hear recently that pilfering on the railways had shown a decrease. But the fact of high prices and shortages cannot be left out of account when we are considering this wave of pilfering.
Now for the economic side. If prices are to go on rising, how is the policy of wage freezing to be maintained? There must undoubtedly be the utmost difficulty. It will be well-nigh impossible to maintain a policy of wage freezing if prices continue to rise, and if wage freezing goes, then price stabilisation also goes, and the result will be more inflation: there can be no alternative to that. On this question of wage freezing, I would refer to one matter. So far as I recollect, the announcement about the policy of wage freezing left a certain loophole concerning the lowest-paid wage earners, and I would enter a plea that the case of one body of workers—there may be others—may be carefully considered by the Government.
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I refer to the lower-paid railwaymen, who are receiving almost a starvation wage. I have made all the inquiries that I could about these lower-paid railway workers, and I find that there are men who are receiving a wage of 92s. a week. These men have no possibility of increasing their earnings by tips or by overtime. Ninety-two shillings a week is their wage; that is the extent of what they can earn. To-day a married man with two or three children, with a wage of 92s. a week, must, in the face of these rising prices, have a very grim time of it indeed. I fully recognise the difficulties. If you once start some snow moving, it may develop into an avalanche; yet I hope it may be possible to use that loophole in the announcement and that something may be done to improve the wages of railwaymen and other men who similarly may be earning a very small wage indeed.
LORD BALFOUR OF BURLEIGH: The noble Lord will forgive my interrupting, but the statement he has just made about railwaymen getting 92s. a week is one of great importance. Would it be possible for him to give the authority for the statement he made to the House, or alternatively may I ask whether we can have some official information on the point? Because I have heard equally authoritative doubts cast upon that statement. I should like to know what the truth is.
LORD WINSTER: I can assure the noble Lord that I did check my statement from what I regard as a completely authoritative source. If the matter is in dispute, perhaps there should be an official reply on the subject to set the matter at rest.
What are the causes of these high prices? Shortages of materials, the demands of exports, high Government expenditure, high taxation, high costs of materials, high labour costs, high costs of transport—all these, of course, are contributory factors to the rising cost of living. Prices are bound to rise when these expenses are rising also. They are bound to rise in order that a certain margin of profit may be maintained. Profits do not pass entirely into the pockets of the directors or of the shareholders. Profits are necessary in order that reserve funds may be built up upon which the stability of great industries

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must depend. Profits are required in order that industries may be kept abreast of modern equipment and modern machinery. Profits are also necessary in order to pay the higher costs to which I have referred. Therefore, as these prices and these costs rise, industries are bound to raise their prices accordingly in order to maintain that balance of profit which alone enables them to keep their industries in being.
Then there is the point of the high labour costs. High wages are an excellent thing, as I have always maintained, so far as I have had to raise my voice on these matters. All through my connection with politics, I have always been an advocate of good and high wages. But what I am puzzled about is this: I had always thought that, as wages increased, there would be a progress in technocracy, in the invention and development of machines which would enable industry to pay these higher wages while at the same time getting an increased efficiency and an increased productivity which would enable them to keep prices level or even, as I had hoped, in some cases to reduce them. I confess I am very puzzled indeed as to why that has not come about, because clearly there has been no lack of great inventive skill and no lack of engineering skill; moreover, while not in all respects what we would wish it to be, there has been a great development in technocracy.
To that question I confess I should very much like to know the answer. Is it that high taxation is preventing some of our industries from re-equipping themselves or from installing the most modern machinery which is available; or is it also possible that restrictive practices, about which we have heard a great deal this afternoon—restrictive practices on the part of the employers quite as much as on the part of the unions or of the workers—are preventing industry from reaping the full benefit of modem invention and of modern technocracy? I ask that question because in recent months I have been going carefully into the situation in the docks. I am told that the turn-round of ships in the docks is much slower than it should be, and that the expense to which many ship-owners have gone in rebuilding their merchant fleets and putting greater speed into their ships is largely negatived because of the slow turn-round
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of ships in the docks. Also, I ant told that mechanisation in the docks has not gone nearly so far or produced nearly such good results as it should have done and that there is a reluctance to accept the economies in man-power which should be made possible were our docks thoroughly mechanised or the machines used to their full potentialities. That is a point upon which it would be extremely interesting to have some information—as to how far and to what extent restrictive practices are responsible for the high prices prevailing to-day and, if they are in part responsible, what can be done to tackle that problem. I have mentioned these restrictive practices before in debate in your Lordships' House. I have had the feeling that the evil of them is admitted, but I have not had any clear acknowledgement of that fact or any clear suggestion of what can be done to tackle that matter.
Then there is the question of high Government expenditure. We are told that it is impossible to reduce it. Let us agree that the Budget of over £3,000,000,000 a year, for the sake of argument, cannot be reduced, and that every penny of that expenditure is necessary. Even if that is so, its effect upon high prices is very obvious. It will be difficult to get prices down substantially while expenditure is running at that rate. There has recently been a great deal of criticism about expenditure on the Health Services, which is running at nearly £400,000,000 a year. I see that the New Statesman and Nation in the current issue says:
"There is no doubt that by energetic action large sums of money can be saved."
We are not begrudging the necessary funds for the Health Services or for any other form of social welfare but, over this vast field of expenditure of, as I say, £3,000,000,000 a year, is it really the case that there are no possibilities whatsoever of pruning or economising without sacrifice of efficiency? That is a question which is very much in people's minds. I am not begrudging expenditure upon the social services; I am asking whether some pruning and economy are not possible. It is impossible to ignore, too, the constant instances of waste and of inefficiency which are brought to notice and which certainly go uncontradicted. We are told that it is quite impossible to reduce expenditure; and yet, under pressure, expenditure has been reduced. There was pressure about the food subsidies and the

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food subsidies were reduced. At the time of devaluation of the pound, it was found possible again to announce considerable economies in order to offset the effects of devaluation. Quite recently we have been told that a ceiling is to be put on expenditure for the Health Services. With those examples before one, I think one is again entitled to ask, is it really the case that, with careful scrutiny over the whole field of economy, no pruning or economies are possible?
We have this afternoon heard a great deal of the reasons for high prices. If I may say so, I thought the reasons were ably and cogently put. Undoubtedly, there are very serious and good reasons to put forward in explanation of the high prices. Certainly the reasons are good, but there is a more important question still—namely, is there no prospect whatsoever of reducing living costs? Is the answer to that: "No, the Government cannot see the way. These high prices are here and they must continue"? Is that the prospect which lies before us? If we are to be told on the other hand, "Yes, the Government do see the way. They are working on this matter and prices are going to be brought down," then one would like to hear what the plan is and in what way this task is to be undertaken.
There are many factors which the Government will have to fit into its plan for reducing high prices, if such a plan in fact exists. There is the policy of full employment. Nobody would wish, for one moment, to see that affected. As I understand it, we are all committed to the policy of full employment and, similarly, to the policy of short hours. To that there is general agreement. I have spoken about restrictive practices. I am not quite so sure about that matter. I think there is a feeling that something could be done by an effort to check some of the restrictive measures which, as I have pointed out, are practised on both sides of industry. I do not know that much can be done about purchase tax because, as I understand it—I shall be corrected if I am wrong—its main purpose is anti-inflationary. The wish by imposing this tax is to reduce spending. Sometimes, purchase tax seems to contain a great many anomalies and to produce some extraordinary situations. I read recently of a
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firm of stationers who had been selling a very good combined pencil case and rubber eraser in the shape of a dachshund dog, the nose being the pencil and the tail being the rubber eraser. Up to quite recently, the purchase tax on that article was 33½ per cent., but the firm has been notified that the tax is now increased to 100 per cent. because the dachshund is a statuette and might be bought as an ornament instead of for the purpose for which it is manufactured. I cannot help feeling that if the whole range of purchase tax were examined, a good deal of pruning could be done. There is taxation of 40 per cent. That is a very high taxation indeed, but no prospect is held out of any possibility of a reduction, although I see that in regard to beer, we have arrived at a state of diminishing returns—or perhaps one ought to say, diminishing intake. At any rate, that tax has been raised so high that the consumption of beer is falling.
No one wishes to see the benefits of the Welfare State reduced. There are the losses on nationalised industries. It will be some time yet before the nationalised industries are through all their teething troubles and begin to show profits instead of losses. There are the food subsidies. There is the end of Marshall Aid looming a short distance ahead. All these are lions in the path of any reduction of the high prices from which we are suffering. If it is the case that the Government have this matter very much at heart, and are anxiously considering what can be done about it, it would be interesting know how they propose to deal with all these very serious factors in the plan upon which, I have no doubt, they are working. We must all wish them success in that respect, because these high prices affect our ability to compete in the industrial markets, and if we lose our ability to compete we shall have something very much worse than rising prices to face.
5.56 p.m.
LORD WOLVERTON: My Lords, there are many things in the speech of the noble Lord, Lord Winster, with which I would agree, but there is one thing with which I am not in agreement. While I wish to see good wages to-day in every industry I am very doubtful about raising the wages of the lower paid railway workers without raising the wages of other railway workers. If that were

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done the technical grades on the railways would have a genuine grouse; it would not give anybody encouragement to train himself so that he could rise to the more technical grades. I believe that it would be a very grave matter suddenly to raise the wages of the lower grades, although I agree that their wages are very low indeed. I think there is great danger in that and, speaking for myself, I am not in favour of it. There is a great deal in what the noble Lord says about high prices, which we all agree have been causing a large amount of pilfering and juvenile delinquency, but we hope the situation will improve.
In supporting this Motion, raised by my noble friend Lord Balfour of Inch rye, I agree entirely with everything he said about rising prices in regard to food, clothing and household goods, and about the decreasing purchasing power of the pound. It is a situation of extreme difficulty, and if not checked it will become very grave. We have got to face the hard realities that all our raw materials are costing us much more money, with all the inevitable consequences. I wish to deal to-night with only one aspect of this important debate—namely, the ever-increasing price of coal, electricity and gas, because upon these main basic sources of power depends the manufacturing success of the secondary industries.
My Lords, all those industries have been nationalised, and belong to the State. Earlier on in the debate the noble Viscount, Lord Samuel, drew attention to the rise in the cost of blankets. He said that recently at least £1 had been added to the cost of a pair of blankets. He also raised the all-important point of the increased price of imported wool which, as we know, is still bulk purchased. But there is another aspect besides the production of blankets, and that is the increased cost of coal which in the last three and a half years has risen at least 6s. 6d. per ton. I would also draw your Lordships' attention to the great increase in the price of electricity. In the first annual report of the British Electricity Authority published in January of this year, it is pointed out on page 114 that it is difficult to make complete comparisons. Comparisons were, however, drawn between the figures of the Electricity Commissioners for the years 1946–47 and 1947–48 and the B.E.A. figures for 1948–49, the first year under nationalisation.
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For the years 1946–47 and 1947–48 one sees that the average price per unit of electricity sold rose by 5.8 per cent., whereas in the year 1948–49 it rose by 9.6 per cent. That is a very disturbing factor.
On another page of the report it was stated that from 1932 onwards to March 31, 1949, the price of coal for generating stations has risen by no less than 316 per cent. The cost of generation, of course, has not risen in proportion, it has risen only by 71 per cent., owing to the greater thermal efficiency of power stations. In those years the cost of generation has risen by 71 per cent. This also is a very disturbing factor. And that is not the whole story. If I may detain your Lordships for a few more moments, I would return to page 114 of the report. There, under the heading of "Other expenses, less miscellaneous income" we are shown that the expenses of running an undertaking, other than working costs of generation, fuel and so on, rose in the year 1947–48 by 4.7 per cent. and in the year 1948–49 by 14.3 per cent. As I say, I think that these are very disturbing factors.
We have not yet had the first accounts relating to gas, but I am credibly informed that in many areas the cost of gas has gone up. It is not easy, however, to see the picture properly when one has nothing on which to base facts. I should like to ask the noble Lord, Lord Lucas of Chilworth, what the basic producers are doing about this, and whether he does not think that these basic industries (I refer to the basic industries which are nationalised) should be looked at first because manufacturers are entirely dependent on these other industries for fuel and power? If they cannot get their fuel and power at more reasonable prices then I do not see very much hope of their being able to reduce some of their prices, especially as in our decreased currency we are having to pay very much higher prices for raw materials.
6.4 p.m.
LORD LLEWELLIN: My Lords, I intend, now that we are nearing the conclusion of this debate, to deal mainly with the question of food and how prices have risen. But before doing so I would like to put this point. The noble Lord, Lord Lucas of Chilworth, whom we were glad to hear speak for the Government

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so early in the debate, said that noble Lords on this side of the House had not a monopoly of concern in regard to rising prices. On that, I completely agree. The noble Lord did not go on to say, however, that it followed, therefore, that the Government were going to accept the Motion on the Order Paper. If they were to do so, they would, of course, fully associate themselves with that concern. If they do not, we shall naturally think that the words of the noble Lord, Lord Lucas, mean rather less than perhaps he intended to imply by them, and that the Government's concern is rather halfhearted and is not going to be translated sufficiently into action to accept the Motion. It is, if I may say so, an extremely innocuous Motion, and it does not even necessitate advising His Most Gracious Majesty to allow Papers to be laid, because the Motion has not that usual appendage. It will be interesting to see whether Lord Pakenham accepts this Motion—he ought clearly to embrace it if the Government are whole-hearted in their concern—or whether he passes it by or rejects it, as he may be inclined to do.
In 1945, when I left the Ministry of Food, we had estimated during the summer that the food subsidies would cost that year some £245,000,000. In actual fact, they cost, I believe, £265,000,000 for the year 1945. They have now gone up to, I think, £465,400,000. In view of the additional costs of subsidies, it is as well to ask how we are getting on and how prices stand in comparison. In April, 1946, what had been the 2 lb. loaf was reduced to 1 lb., the price remaining the same. It was thought, I believe, that by these means it would be less apparent to the consumers that they had to pay more for their bread. At any rate, that was the way in which, on that occasion, the price was raised. After devaluation, as your Lordships are well aware, the price went up from 4½d. to 5½d. Similarly, flour went up by ½d. a lb. as the direct result, as the Chancellor of the Exchequer told us, of the devaluation of the pound. Apart altogether from that, and apart from these high subsidies, in June, 1947, tea went up by 4d. a lb., after last year's Budget, cheese went up by 4d. a lb., meat by 4d. a lb., margarine by 1d. a lb. and butter by 2d. a lb.
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I would now like to compare the average cost of certain foods to a household at the moment with what it was pre-war. In 1937–38, an inquiry was undertaken by the Ministry of Labour in order to obtain a representative collection of family budgets giving particulars of the weekly expenses of households of weekly wage earners in Great Britain and Northern Ireland. The budgets supplied enabled the average to be worked out for a household of 3¾ persons. It was shown that in each house in those days, average amounts of foods taken per week were: bread, 13.5 lb.; flour, 4.4 lb.; meat, 4.7 lb.; bacon, 1.4 lb.; fresh milk, 11.2 pints; butter, 1.8 lb.; potatoes, 13.8 lb.; eggs, 14.1; and margarine, cheese and tea, 7 lb. each.
Let us now compare the retail cost of those commodities in those days—when of course there were no food subsidies—with the cost of similar amounts to-day. In some cases, of course, it is not possible to get similar amounts, because the same amount of food, through rationing, is not procurable, but I am taking what would have to be paid if similar amounts could he obtained. The comparisons are these. For the amount of bread which I have mentioned, which then cost 2s. 8¼d:, you now have to pay 3s. 6d. Other figures are as follows: flour, 10d, then and 1s. ld. now; meat, 4s. 8d. then and 6s. 8d. now; bacon, 1s. 11d. then and 3s. 1d. now; milk, 3s. 0¼d. then and 4s. 8d. now; butter, 2s. 5½d. then and 2s. 7d. now; margarine, 4¾d. then and 7d. now; cheese, 7d. then and 9d. now; tea, is. 7d. then and 2s. 4d. now; sugar, 1s. 0½d. then and 2s. now; potatoes, 1s. 1d. then and 1s, 7d. now; eggs. 1s. 10d. for 14 then, and 3s. 6d. now. These are considerable rises in the cost of living to weekly wage earners.
The Government may say that the increases are much less than those in other parts of the world, and to some extent that is true. But when we come to look at the figures which have been published by the Food and Agriculture Organisation of the United Nations, showing the success of food subsidy payments in controlling inflation, as measured by the general wholesale index, the United Kingdom's payments, although the highest, are among the least successful by this measure. Taking the general wholesale index as being 100 for 1937,

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the United States, with no food subsidies, went up to 176 in 1948. On the other hand, this country, with subsidies working out at £8.1 per head of the population, went up to 202. The Netherlands, with food subsidies of £5.8 per head, went up to 259.
LORD PAKENHAM: Is the noble Lord quoting the wholesale figures or the cost-of-living figures, because he appears to be quoting the wholesale figures?
LORD LLEWELLIN: The first figure I quoted is the food subsidies given in pounds per head of population. The figure of food subsidies per head of the population in this country is £8.1. I am not sure that we should not have done better if we kept that £8 in our pockets and made up what the food subsidies come to. Then I quoted the general wholesale index of prices, which, taking 1937 as 100, which I think is fair, shows that in the United States the index rose to 176, in the United Kingdom to 202, in Sweden to 175, in Norway to 172, in the Netherlands to 259, and in France (which was a case the noble Lord quoted, and quoted rightly from his point of view), the index went up to 1,712, without foci subsidies. In Denmark the index went up to 213, and in Australia, with a very small subsidy of £1.4 per head, to 169. The figures in this table show that, despite the fact that we are spending more on food subsidies per head of population than any other country, our cost-of-living index has risen, and risen higher than that of the United States.
The Government may also say, as the noble Lord, Lord Lucas of Chilworth, has already said, that wages have similarly risen. I have no doubt that the figures which the noble Lord gave were right, but he was rot on such strong ground when he dealt with those living on fixed incomes—old-age pensioners, those living on disablement pensions, and those retired from business who are living on their savings. He said there has been a number of increases. So far as I know, the increase given to old-age pensioners is given according to a means test. That is not a matter in which members of the Labour Party have always delighted. As your Lordships will remember, before the war, in the days of the Conservative Government, a measure was brought in to supplement
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old-age pensions in cases where necessity was shown. That was opposed by the; Opposition of those days, and it is pleasant to think that now such a scheme; is in operation they are taking some credit for it. Equally, the basic pension of a disabled soldier has not increased, despite the fact that your Lordships, ably led by the noble Earl, Lord Cork and Orrery, passed a Motion in the last Parliament that that should be done. It is these classes of people who are most affected by the rise in the cost of living, because the man who has his labour or some other service to offer can easily bargain if he wishes to do so. If I am wrong about the old-age pensioners—
LORD PAKENHAM: The old-age pension has been increased from 20s. for a married couple to 42s., since 1946. without a means test.
LORD LLEWELLIN: If I am wrong, I apologise to the House. At any rate, a point to be watched is the effect of any further rise in the cost of living. I gather from that particular fact that the pension was 20s. before the war, and increased to 42s. in 1946.
LORD PAKENHAM: For a couple.
LORD LLEWELLIN: I am obliged to the noble Lord. All the cases I have given of increases in the cost of food have occurred since 1946. Therefore, I have at least made out a case for that problem to be considered. For my part, I would sooner see it tackled on the line that the noble Lord, Lord Winster, suggested, of the Government trying to prevent an increase, rather than by paying out more money to compensate old-age pensioners and others who suffer when the increase has taken place.
I believe that the rise in the cost of food has to some extent been due to the system of bulk baying. I am not one of those who oppose bulk buying root and branch; it would be silly for me to do so, because I was the Minister who made the first contracts with Australia and New Zealand. I believe it was absolutely right to do that. If we wanted to get increased production within the sterling area, and from our folk across the seas, it was right that we should give them, a guarantee that we would take the extra they produced, just as we guaranteed our own farmers

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at the same time. I am a believer in that sort of Government guarantee and that sort of bulk purchase. I was a little horrified to hear the noble Lord, Lord Lucas, say that the wheat agreement with Canada was a hard commercial bargain. I do not believe it was. When I was dealing with the Canadian Government I never found that they were at all hard commercial bargainers. The present Government have had to deal with the same body of persons and with the same Minister, and I believe it was a generous gesture on the part of Canada to agree to sell us wheat at that price. The noble Lord, Lord Lucas, is shaking his head in dissent, but the noble Viscount, Lord Addison, seems to be more inclined to agree with me, and he had more to do with that particular negotiation than did Lord Lucas. I should not like it to go out from this House uncontradicted that Canada had come to a hard commercial bargain with us, for I believe it was a very generous gesture.
However, sending people to places like the Argentine to carry out bulk buying is a very different matter. In those cases, it is much better to send people who will come to a hard commercial bargain, rather than to carry out the transactions partly through diplomatic channels. In a time of rising prices, I believe that the sooner we get rid of this bulk buying the better, except where it is to encourage further production from our own British stock overseas—or, indeed, from Britishers, whether they are our own stock or not, because I would do it with the coloured producer of sugar in Jamaica.
VISCOUNT ADDISON: Does the noble Lord want us to get out of it in the ease of Queensland?
LORD LLEWELLIN: No.
VISCOUNT ADDISON: I thought the noble Lord said he did.
LORD LLEWELLIN: No, I said except for our own people overseas. If I may say so, Queensland is covered by the arrangements I made with regard to Australia as a whole. I would not get out of it in the case of Queensland. I would carry on these arrangements in any case where, by giving a future guarantee
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to the farmers of such places as Queensland, we could increase the production of food in the sterling area, both for their needs and for ours. Some of this bulk purchasing I dislike intensely. In my view, we made a very bad bargain over the Algerian wine. It was very lucky that in the end the Minister of Food was able to get rid of it in Germany. I am told that there were some Germans who did not realise they had lost the war until they found they had to drink the Algerian wine sent over to them by the kind permission of the then Minister of Food!
We are all concerned to try and stop the rising prices. That they have risen is beyond dispute; that they are tending to rise still further is beyond dispute; and that the rise ought to be stopped is also beyond dispute. The noble Lord, Lord Winster, dealt with several of the contributing causes, and I could not agree with him more when he says that one of them is high Government expenditure and high taxation. Those are things with which the Government should find it easy to deal, because they are completely under their control. I suspect that, having said that, when the noble Lord, Lord Pakenham, speaks he will say: "What would you do if you were sitting here?" I am sure we should all agree, if we were honest, that that is much easier to answer if you have Treasury advice than if you have not got access to all the facts that the Treasury advisers used to have, and I suppose still have to-day. At any rate, I should make some cuts in Government expenditure. I was surprised to read that the Chancellor of the Exchequer said at the time of the Election that no cuts were possible, and that it was absurd (I have not his exact words) for the Conservatives to go on talking as they were talking. I am not quoting him verbatim, but I remember his making some remark of that sort. I am afraid he is the sort of man who has exhausted himself by economising—because we all know he does that, and I am speaking quite genuinely. I do wish he would take a little more to eat himself and exercise a little more vigour on making some of the big spending Departments economise.
May I give one or two examples of the way in which I should cut down? I should first of all eliminate the £16,000 000–I believe that is the figure—which the Government spend on publicity. I maintain that a good Government

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require no publicity beyond the good they do; it is a sign of weakness if a Government have to spend £16,000,000 on publicity. So let us all agree, from one point of view or the other, that if we were to govern, we should not need £16,000,000. I hope that the noble Lord, Lord Pakenham, in his reply, will say: "We are just as good a Government as you would be, therefore we do not need it either, and we will cut out this £16,000,000." Another matter I would cut down severely is the £4,000,000 a year which we spend on the British Council. I believe that that service is extravagantly run, and somebody ought to look into it. We have these charming people in practically every capital in the world; they run a lending library well, and they are very nice, but I doubt whether they are worth fall the money we now spend upon them.
I would also cut out—for the moment I have forgotten the figure, but it is an appalling one—civil service travelling. May I tell your Lordships of a case which happened the other day? I am not certain whether this young lady would be termed a civil servant, or whether she is part of the savings movement. A friend of mine farms in rather a wild part of Dorset, between Blandford and Salisbury. A lady turned up there in a car and said, "I should like to see Mr. John X." The wife, thinking that she meant her husband, said that he was working in the fields, and asked whether she could answer any questions. The young lady said: "Perhaps you can tell me. Last year he put some money in national savings certificates and he has not put any in since. I came because I should like to know whether he is dissatisfied, and if so why he is dissatisfied and whether he does not think he is getting his money's worth." The wife remembered that her husband had not put any money in, and she said: "You have come to interview my boy. I do not know that he will be able to tell you what you want, because he is only four years of age. We put in some money for him the first year, and we did not put any in the next year. I do not think he will be able to tell you whether he is dissatisfied or not." I do not know who sends a woman like that in a car to visit people, who have difficulty in obtaining petrol to go into their market town, to ask questions of a small boy four years of age. It may happen by putting a pin in a list, but I do
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not know why these journeys are necessary. We all know why people either do or do not put money into national savings. One may be that money is tighter—as we all know it is; they may be able to afford something one year and not the next; they may decide not to have a summer holiday one year and to have one the next. But it is not worth while sending people on a journey for things of that sort.
I have quoted a few cases in which I would certainly cut down on Government expenditure, and I am certain that if I were sitting on the other side of the House I should find a great many more. I do not believe that a real search has been made. With great respect to him, I do not believe that after a Chancellor of the Exchequer has said that there are no savings to be made ye are likely to see many savings made. The Chancellor is a man who should be saying all the time: "There are more savings to be made, and I insist that you make sonic more."
LORD PAKENHAM: Just for the record, I am sure the noble Lord would wish to quote the passage if he has it available. I cannot remember anything quite so bald as that coming from the Chancellor of the Exchequer.
LORD LLEWELLIN: I am sorry that I cannot supply the actual quotation, but I could certainly get it for the noble Lord. I did not mean to quote it verbatim, and I am sorry that I have not brought it with me. I remember that it was in a speech made during the Election. It was to the effect: "It is no good the Conservatives going out and saying that they can make all these economies, because I can assure you that things have been cut as much as they can be," or words to that effect.
LORD PAKENHAM: My noble friend believes that the Chancellor said there were no major savings to be made.
LORD LLEWELLIN: I do not know what is meant by a "major saving." At any rate, I will have the cutting turned up, and I will hand it to the noble Lord or give it to my noble friend Lord Balfour when he winds up this debate. Be that as it may, the Chancellor should say to the spending Departments: "I know there can be major and minor savings, and you must look for them both. In that way

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we shall get a Budget in which taxation will not be so tremendously high in time of peace." That would affect the cost of living, which we all want to see come down, and that would indicate that the Government were showing some concern over this problem. To end up in the way I started, if noble Lords are really earnest in their concern about the matters referred to in the Motion of my noble friend, they will not only pursue that policy but will gladly accept with us the Motion that is on the Order Paper to-day.
6.39 p.m.
LORD PAKENHAM: My Lords, the noble Lord who has just sat down has spoken to us, as he always does, in the most reasonable and friendly way. I hope that the noble Lord, Lord De L'Isle and Dudley—if he is with us—is not going to press too hard the demand that I should not twit the Opposition, because if we were not allowed to twit one another across this Table I feel that we should very soon come to blows. I hope that that particular demand is not to be taken in all seriousness.
All of us who have sat through this debate have enjoyed it and profited from it, but I am bound to say, while paying my tribute to the Parliamentary skill with which the noble Lord, Lord Balfour of Inchrye, set the ball rolling, that I was surprised by some observations which fell from him. I am always particularly ready to make allowances for the noble Lord, because he has been so kind to me, helping me with all his expert knowledge in my present office. The noble Lord said he did not feel that the Labour Party had talked enough at the Election about the cost of living. I do not know whether he read our propaganda. If so he would have found on page 3 of Labour Believes in Britain that we promised a square deal for consumers; and very many measures were set forth with precisely the object that he has in mind. In my recollection, we talked a good deal at the Election about the cost of living. I cannot agree that we did not talk enough about it. But I hope the noble Lord will not mind my saying that it is a pity noble Lords opposite and their colleagues talked as much as they did on that subject during the Election.
I am sorry the noble Lord, Lord Woolton, is not here to-day. I sent
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him word that I was going to allude to his famous broadcast. Perhaps a few words on that subject might not be out of place. Your Lordships will recollect what was said on this very subject in the very readable pamphlet This is the Road. On page 6, near the bottom we are told:
"In any approach to the problem of food subsidies, made necessary by the urgent need to improve the purchasing power of the £, we shall be bound by this pledge. There will be no reduction which might influence the price of food without compensating increases to those most affected. These compensations will take the form of larger family allowances, pensions and other social benefits …"
It is clearly admitted here—I would ask the noble Lord, Lord Balfour of Inchrye, to correct me if I am wrong—that the Conservative proposals would lead to a rise in food prices. Otherwise, what would be the point of these allowances and compensations?
LORD LLEWELLIN: That was done, as my noble friend Lord De L'Isle and Dudley said (anticipating the line that the noble Lord was going to take in his winding-up speech—and apparently he foresaw it well), to get ahead of the rumours that we knew would be put round by Labour speakers during the course of the Election!
SEVERAL NOBLE LORDS: Oh!
LORD PAKENHAM: I think I must be content with the cries of "Oh," and leave it there. But Lord Woolton was obviously not content with this line of argument, because it may not have proved quite as infectious as was hoped. I must say, in passing, that I envy the noble Lord his powers of broadcasting. I attempted to broadcast only once, and then the announcer took away my notes—with disastrous results. And I was never asked to broadcast again. Lord Woolton is, I believe, a delightful broadcaster. When he got into the studio he took a very bold line and repeated, as he became more and more excited towards the end of his broadcast, the statement that the Conservative Party would reduce the cost of living. This was not promised in the official pamphlet. The noble Lord also said:
"I repeat it: we will reduce the cost of living and we will cut down extravagance in Government spending. We will restore competition in the food trades and we will cut the cost to the Treasury of food subsidy.…"

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In fact Lord Woolton went far beyond what I understood to be his brief in promising that not only would food subsidies be reduced, and in that way expenditure reduced, but that the cost of living would come down. Well, my Lords, I do not think that even on the high authority of Lord Woolton—and he is respected everywhere—many people were found to believe that both these things were possible.
THE MARQUESS OF SALISBURY: I think it is only fair to my noble friend Lord Wootton to say that Lord Pakenham is giving the noble Lord's conclusions and omitting all his arguments. His argument was—I speak from memory—that the Conservative Party considered that by going back to traditional methods of buying they would be able to buy more cheaply and that therefore a smaller subsidy would be necessary to produce the same results. It might be possible, if they bought cheaply enough, actually to lower the cost of living. That argument was left out entirely by the noble Lord, Lord Pakenham, merely said dogmatically that Lord Wootton said he was going to reduce the cost of living, but he did not give Lord Woolton's argument as to how it could be done. I do not suggest that Lord Pakenham will agree with Lord Wootton, but he will, I am sure, agree that Lord Wootton's argument was a perfectly reasonable one to put forward.
LORD PAKENHAM: It was not an argument that was put forward in the Conservative document. That document offered compensation for those who would have to face a rise in the cost of living. Lord Woolton's argument must have been worked out between the publication of that document and his broadcast. But I would exonerate myself of the charge of concealing anything. The noble Lord, Lord De L'Isle and Dudley, accused me of a certain evasiveness—
LORD DE L'ISLE AND DUDLEY: That observation showed great restraint on my part.
LORD PAKENHAM: We all have our faults, but that particular one is not usually attributed to me. I read the passage as the noble Lord read it.
"… we will reduce the cost of living and we will cut down extravagance in Government spending. We will restore competition in the
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food trades and we will cut the cost to the Treasury of food subsidy."
I went through the Election frankly assuming that the Conservative Party, with all their virtues, were not a Party who were likely to lower the cost of living. But here they come forward and raise this very grave issue, which is one. I am bound to say, in which perhaps the advantage lies with us.
May I return to another point which the noble Lord, Lord Balfour of Inchrye, made, and which was taken up by another speaker, Lord Hawke? The noble Lord expressed a certain impatience of these indices. My Lords, we are all inclined to sweep away figures which do not appeal to us and to invoke them when, they are more helpful. In this case the noble Lord preferred not to have recourse to the official figures. He referred to the housewife. I know that the housewife is very important: she has to be wooed in her millions. But the housewife cannot, I think, be looked upon as a reliable statistician. That is not her function.
LORD SANDHURST: Has the noble Lord ever consulted his wife?
LORD PAKENHAM: My wife and I have just had influenza together, and have been in very close touch. If that is not what is now called "joint consultation" I am not certain what is. The housewife cannot be invoked to settle this; matter one way or the other. I made my own little inquiry this morning, having in mind the possibility that this point might be brought up to-day. I asked a small provision merchant about the price of foods, and he said that the prices of three foods have gone down recently, and that no food price had gone up. An argument of that kind would be, I ant sure, considered frivolous by the noble Lord, Lord De L'Isle and Dudley. I do not rest anything upon an argument of that kind. I think that we must deal with the official figures, unless we attempt to challenge them—and they have not been seriously challenged. As the noble Lord, Lord Lucas, explained so clearly, since 1945 there has been a rise in tht! retail prices—that is, the prices of food, clothing, household and miscellaneous goods—of 23 per cent., and the rise in the prices of food has been 31 per cent. since the middle of 1945. I venture to suggest that we should work on that basis

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and not on the strength of certain information we have picked up in one way or another through chance encounters.
I should like to pass on to one or two particular points before coming to the broader themes. The noble Viscount, Lord Samuel, returned to his old argument that high taxation produces inflation. That argument may be regarded by him as very stimulating but, so far as I know, it has not received support from many economists. It is not a point that one can prove in vacuo, one way or the other. The Colwyn Committee many years ago decided that you cannot include a tax on profits in working out costs. The noble Viscount will no doubt have many recollections of that kind. May I approach it in a different way? I know that I shall not convince him, but I should like to lay one point before him. Let us go back. One of the greatest Liberal eras, when Liberalism was in its heyday, was the period 1850 to 1873. (I take those years more or less at random, but perhaps not entirely so, as the noble Viscount will appreciate.) That was the era of Cobden and Bright. Prices were rising the whole time. For twenty-three years there was a steady rise in prices and it happened shortly after the introduction of Free Trade in this country. It may or may not have been due to Liberalism, but, as a matter of actual fact, there was a secular rise of price from 1850 to 1873. To take another more recent period, from 1896 to 1914, prices were rising steadily, and all through that famous Liberal era from 1905 to 1914. I beg the noble Viscount not to put the recent rise in prices all down to the present Labour Government. Those things have happened over a much longer period, when the Liberals were in power in their most glorious moments.
VISCOUNT SAMUEL: Not to so disastrous and sudden an extent.
LORD PAKENHAM: My Lords, anybody can use the word "disastrous." I certainly would not argue with the noble Viscount as to whether he could find any parallel for a sudden rise in prices of this kind—23 per cent. I do not know whether there was any time during those years when they rose so fast. But you can find many periods in the past. Just after the First World War there was a
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very sudden and disastrous increase at the time when there was a Liberal Prime Minister, the famous Mr. Lloyd George. Then there was a very sharp rise, followed by a collapse. That is what we want to avoid by the policy which we are pursuing on this occasion.
May I return to another point that was made by the noble Lord, Lord Hawke, and also taken up by the noble Lord, Lord De L'Isle and Dudley—the question of savings? I have no doubt that we shall be coming back to all those subjects very shortly. The Economic Survey is published to-day and I shall allude to it in a moment. The House will not expect me to say the last word on any of these matters now, but may I say two things, and two things only, about saving? In the first place, let me reiterate that there is absolutely no truth in the hypothesis of the noble Lord, Lord De L'Isle and Dudley, that the Government are not concerned with the saver. We are most anxious to do everything we can for saving, and to enlist the aid of noble Lords opposite in encouraging saving still more. I hope the noble Lord will take it from me in all seriousness that on behalf of the Government I repudiate absolutely the suggestion that we have no concern with the saver.
The other point I can deliver more calmly, and I hope the noble Lord will readily accept it. It is simply a question of fact. I agree that the savings movement has encountered many difficulties which we must attempt to overcome. This fact is one which has not been mentioned to-day and is not usually mentioned in these discussions, and it goes along with other facts which have been stated. With accrued interest the amount invested in national savings at the end of the year was £52,000,000 more than it was the year before. The amount remaining invested at the end of 1949 was £52,000,000 more, the total standing at £6,097,000.000. In other words, there was more invested in national savings at the end of the year than at the beginning of the year. Therefore, we must not go away saying that national savings are going down in that sense, because really that is not the case.
LORD DE LISLE AND DUDLEY: That is with interest?
LORD PAKENHAM: With interest.
LORD DE L'ISLE AND DUDLEY: I want to get the facts right. I take it that the figure given in The Times financial column to-day is accurate, that the net withdrawal was £64,000,000 in the last year. That is published. I should like to know the noble Lord's views upon that.
LORD PAKENHAM: My Lords, I have not read that particular article in The Times but, if the noble Lord quotes that figure, he is probably right. But the figure I have given is a fact which the public should know—that there was more invested in national savings at the end of last year, on the latest date available, than at the beginning of the year, If we choose to take the amount remaining invested in national savings as a criterion of public confidence, then, judging from the figures available, public confidence stands very high.
Perhaps the speakers on my own side of the House will forgive my not alluding to them as I should like. I will only thank them for their contributions. May I go on to one point before finally reaching the bigger issue—one particular point raised by the noble Lord, Lord Llewellin, where I think he is under a misapprehension? He took the subsidies per head of the -population in this country and other countries, and then took wholesale prices as indicating what the consumers have to pay. Surely, if the noble Lord thinks that over, he will agree that what matters is the retail prices—that is, the subsidised prices as far as the consumer is concerned. A comparison between wholesale prices is not relevant. We are establishing a case between the cost of living here and in other countries.
LORD LLEWELLIN: So far as I know, the figures I quoted were figures after the application of the subsidies. I meant them to be.
LORD PAKENHAM: I have not his figures in ray hand, but the noble Lord when I questioned him repeated that they were wholesale prices. We are discussing retail price; this afternoon. May I come to a point that was made by the noble Lord, Lore De L'Isle and Dudley? The noble Lord, with an air of kind patronage, if I may put it that way, was ready to acquit us—we all being members of the same House and having to live together—of some of the responsibility for what
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had happened. We on this side of the House are not shirking our responsibility in any way. That is really the difference between us. Noble Lords regard this last period as disastrous, and the most generous thing that the noble Lord cal think of to say is that all the blame does not fall upon us. Frankly, we are ready to stand by what has happened and to take our stand on the results.
I say quite boldly and in a friendly spirit to the noble Lord, let us just look at one or two facts. I will not detain the House much longer at this late hour. The noble Lord, Lord Lucas, has brought out the fact that leaving aside rent, which is excluded from our discussions to-day, while retail prices have risen 23 per cent., the weekly earnings have also risen 23 per cent., and to that, of course, has to be added the immense extension in social services during the same period. I appreciate the point raised by the noble Lord, Lord Llewellin—I think in an intervention—when he asked whether taxation had been allowed for. That is quite true. If you take the weekly wage earner you would have to take the taxation out of that; but on, balance nobody—and certainly the noble Lord I am sure does not—disputes my general point. The wage earners of this country regard the social services, including the contribution, as a great benefit and a great asset to them, and something very solid which must he included in any comparison of this kind.
LORD LLEWELLIN: I meant only that if you added it on one side you ought to add it on the other.
LORD PAKENHAM: Yes, but if you do acid it on, you have still a great benefit.
As a nation we are producing much more than before the war, and as we have not the noble Lord, Lord Cherwell, with us to-day, I think we can say, without destroying your Lordship's chances of dinner, that the increase is of the order of about 30 per cent. But owing to the necessity for securing increased exports, and the considerably larger capital investment, the standard of life of the whole population per head, so far as one cad recognise these things, may be said to be about the same, while the national in come is far better distributed and the poorer section of the community are vastly better off than they were before the

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war. That is the fact; and because we have had such a share in that fact, we are very proud to accept whatever measure of responsibility is accorded us.
Sometimes the discussion has strayed a little but the comparison to-day, of course, is primarily with 1945. The production in 1949 was 29 per cent. higher than in 1946. Owing to special post-war difficulties, which any Government would have had to face, and of course to the necessity for wanting back our economic independence, there has not hitherto been a corresponding improvement in consumption. But the Economic Survey published to-day—I believe noble Lords may have it in their hands—shows that during 1949 there was at least a real improvement in the food position and in certain other respects. I think I may put it rather briefly to the noble Lord, Lord Llewellin, and perhaps we may have a further opportunity on another occasion of going into it in greater detail. The standard of consumption for the population as a whole is back to prewar, and of course for the poorer sections is very much better than before the war. I will quote from the Economic Survey:
"Food production in 1949 greatly improved in almost every section. Greater quantities and more kinds of food became available… Expenditure on food increased substantially and there was a marked increase in real terms."
So that in 1949 we have a clear improvement in the food position, and that I think is an answer to a good deal that the noble Lord, Lord Llewellin, said. The noble Lord, Lord De L'Isle and Dudley, I believe it is fair to say, went so far as to denounce the noble Lord, Lord Lucas, for claiming that there had been an improvement since 1945. I am afraid the statistics are wholly on the side of the noble Lord, Lord Lucas. If we take the working classes—and the noble Lord, Lord De L'Isle and Dudley, was talking of the working classes—we must agree that on the average their standard of life is better than it was in 1945, bearing in mind everything that I have said, including the great extension of social services since that time.
I will not take the House through the world situation because it was explained so well by the noble Lord, Lord Lucas. I am a little surprised that people did
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not pay perhaps somewhat more attention to what seemed to me an extremely forceful explanation. The fact is that we have come through better than other countries, so far as the cost of living is concerned. Our increase is 23 per cent., the American increase is 31 per cent., that of Canada is 36 per cent. The Italian and French increases are very much higher. That is all on the credit side and I refuse to adopt any attitude of apology on behalf of the Government. I refuse to get into a white sheet, but I am perfectly ready to agree with noble Lords who expressed concern, not only at what has happened but at what might happen if we do not take extreme action.
Before I come to answer the question put to me, are we going to accept the Motion, I would explain to noble Lords where we differ from them. We have proceeded on a definite policy. What might be called the physical aspects of it, the trade aspects, have been handled effectively by my noble friend Lord Lucas, and I shall not say more about that at the moment. We have stood for fair shares; we have stood for price control; we have stood for controlling the margins of profit of wholesalers and distributors. On the financial side, we have adopted a definite budgetary policy throughout this period. Standing here in the presence of noble Lords, I simply do not know where noble Lords themselves stand in regard to food subsidies. Perhaps the noble Lord, Lord Balfour, will tell us. At times a word or two pops out to suggest they might cut them down. Certainly for a moment in the Election they adopted a very bold line, but I do not know whether they are in favour of cutting them or not. Perhaps I may put that one question to the noble Lord: Is he in favour of a large reduction in food subsidies?—because if he is not, having studied his literature and that of the Conservative Party with great care, I do not see how they are going to effect these large economies about which they have been talking.
We have stood for a large Budget surplus. Last year even that was derided. The principal speaker for the Opposition, Mr. Oliver Stanley, was distinctly contemptuous of the policy of a large surplus. He said last year:
"Under the kind of conditions and under the kind of Government which I want, I'd take

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a chance—a chance we certainly couldn't take now. I'd take the chance of reducing the surplus, and then I would use all this money to reduce taxes."
That is what he said the Conservative Government would do last year.
My Lords, we have stood for fair shares; we have stood for planning. But we have also stood for austerity in difficult times (and have been derided by noble Lords opposite for doing so), and for keeping down the cost of living as we successfully have done. There is a lot to be said for the operation of the control on increases in personal income not related to an increase in productivity, and the noble Lord will find that point reiterated authoritatively in the Economic Survey. I hope noble Lords will join us in that. But there is a genuine difference of political outlook between us. I do not believe that it is possible to bring about these slashing economies that noble Lords talk about without slashing the incomes and the standard of life of the poorer sections of the community. Noble Lords have not told us how, in comparable circumstances, they would bring about these economies. They have told us only of trifling connections. But we believe in our policy, and intend to persist with it. Noble Lords opposite dislike that policy. They regard that policy as having been unsuccessful—indeed, I think the noble Lord, Lord Balfour, said that if the same policy continues the cost of living is bound to rise. I would refer to the fact hat the cost of living has risen considerably more in all the other comparable countries. We believe in our policy and we intend to go on with it. But while we all aim at the same goal, there is so sharp a difference about method that we cannot accept this Motion. We feel that if we did so we should be betraying principles which to us are vital if the nation, which all Parties are equally concerned to save, is to pull through this difficult period of time.
7.10 p.m.
LORD BALFOUR OF INCHRYE: My Lords, at this late hour I will not detain your Lordships for more than a few moments. I have, however, been asked a question, and I think I am entitled to seek your Lordships' indulgence for just a few moments more while I try to reply. I thank the noble Lord who has wound up this debate on behalf of the Government, but I am sorry that the Government
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feel unable to accept the Motion, for, whatever the arguments may be one way or another, the words of the Motion are words conveying a concern at the rise in cost of food, clothes, and household goods since 1945, and the Government have themselves expressed concern to-day. It seems to me rather peculiar that, having expressed sympathy with the purpose of the Motion, and having found no ground for difference with regard to its drafting, they still feel unable to accept it. However, it is for them to decide. There are just one or two corrections I should like to make. The noble Lord, Lord Pakenham, used the words "question of fact" in a certain connection. Let me say at once, on this question of fact, that I said it had not been stated in speeches at the Election. I made a particular point of saying that there was nothing in the gracious Speech from the Throne which gave any reassurance that the Government were going to introduce drastic measures to put this matter right. Of course, it is in the Labour pamphlet, but I think that had only a limited circulation in the country, and I do not consider that it gave the matter adequate publicity such as speeches of Cabinet Ministers and others would have given it. Speeches were not, ire fact, made upon it.
Next as to the value of indices. The noble Lord suggested that I swept away figures and talked in generalisations. If he would kindly refer to-morrow to what I did say, he will see that I gave figures front what is in fact the only continuous economic survey which we have had in this country from 1938, because the Board of Trade Survey broke in 1947. I gave figures from the London and Cant-bridge Economic Service.
LORD PAKENHAM: In my recollection—I may not have followed the noble Lord's figures correctly—there was an increase of 150 to 182 in the Index during the relevant period, which would be just over 20 per cent. There would not be a big difference between our figures.
LORD BALFOUR OF INCHRYE: I was not, as it were, shooting wide. I was basing my remarks on what were, possibly, better figures.
The noble Lord, Lord Pethwick-Lawrence, seemed to strike the note which is popular with all those who defend the Government's policies relating

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to the cost of living, when he said that, virtually, all was well in the best of all Socialist countries—in fact, everything was really very fine. The noble Lord backed up his words by the generalisation that the vast majority of the people of this country were better off now than they were four or five years ago. He even went so far as to suggest that the increasing good health of the country and the reduced rate of infant mortality were not due to the advances which medical science has made in the last fifty years, but to the Health Services which have been operating fully only in the last year or two. I think that to use that as a supporting argument is taking the matter rather too far.
I thank the noble Lord, Lord Pakenham, for his winding-up speech. I admire his technique immensely. It is to make the most of his case fully and then, when he comes upon a rather difficult argument, to point his political gun at it, turn it away quickly from the main target and shoot a series of red herrings around the room on matters which are entirely irrelevant. It is a very fine technique, but it did not cover certain of the arguments which we have put up to-day. It did not in a single sentence give a refutation of the charge which I made, supported by evidence, that the rise in the cost of living, which hits all sections of the community—including those people not mentioned by the noble Lord, the fixed income members of the community—has taken place against a background of unconditional promises given on this matter by the Government at the 1945 Election, which have not been fulfilled.
LORD PAKENHAM: I am afraid I must interrupt the noble Lord again. I do not accept his statement to that effect at all. I am very sorry to interfere with the noble Lord's peroration.
LORD BALFOUR OF INCHRYE: It may well be that the noble Lord does not accept it. But I made a particular charge, and gave specific evidence to support it, that there was an unconditional promise given, not dependent on the outside circumstances of the rest of
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the world, that Labour would protect the savings of the people, and I showed that the savings of the people had gone down consistently since 1945. The noble Lord did not devote his efforts—I know he may not have had much time—to refuting that charge, but he made many interesting comments on matters which I think are less relevant and less serious for the Government.
On Question, Motion negatived.

CONSOLIDATION BILLS
7.16 p.m.
THE LORD CHANCELLOR: My Lords, I beg to move the Motion which stands in my name on the Order Paper.
Moved, That a Committee of six Lords be appointed to join with a Committee of the House of Commons as a Joint Committee on Consolidation Bills, Statute Law Revision Bills and Bills presented under the Consolidation of Enactments (Procedure) Act, 1949, in the present Session;
That the Lords following be named of the Committee:—

M. Reading,

E. Selkirk,

L. O'Hagan,

L. Belstead,

L. Nathan,

L. Schuster;

That such Committee have power to agree with the Committee of the House of Commons in the appointment of a Chairman.—(The Lord Chancellor.)
On Question, Motion agreed to; Ordered that a Message be sent to the Commons to acquaint them therewith and to request them to appoint six Members of that House to be joined with the said Committee.

MERSEY DOCKS AND HARBOUR BOARD BILL [H.L.]
The CHAIRMAN OF COMMITTEES The CHAIRMAN OF COMMITTEES informed the House that the opposition to the Bill was withdrawn: the Orders made on the 15th instant discharged, and Bill committed.
GERMAN POTASH SYNDICATE LOAN BILL [H.L.]
Reported, with an Amendment.

HOUSE OF LORDS OFFICES
First Report from the Select Committee: made, and to be printed.
House adjourned at seventeen minutes past seven o'clock.