Sitting of 13 July 1955

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS

  CROSBY CORPORATION BILL
  As amended, considered.
  Standing Order 205 (Notice of Third Reading) suspended; Bill to be read the Third time forthwith.—[The Chairman of Ways and Means.]
  Bill accordingly read the Third time and passed.

  ABERDEEN CORPORATION ORDER CONFIRMATION BILL
  Considered; to be read the Third time Tomorrow.
ORAL ANSWERS TO QUESTIONS
  MINISTRY OF DEFENCE

    Retired Pay and Pensions
    Mr. Swinglerasked the Minister of Defence if he will review the rates of retired pay and pensions payable to former Regular members of the Armed Forces, with a view to raising them to an adequate level in relation to the current cost of living.
    The Minister of Defence (Mr. Selwyn Lloyd): The hon. Member will find a full statement of Her Majesty's Government's policy in this matter in the White Paper of March, 1954 (Cmd. 9092). I cannot add to this.
    Mr. Swingler: Is the Minister aware of the grave dissatisfaction among Regular Service pensioners of all ranks with the policy stated in that White Paper? Are we to take it that that is the Government's last word on the subject of the very inadequate scales of retired pay and
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    pensions to Regular Service personnel of all ranks?
    Mr. Lloyd: I am sure that the hon. Gentleman will have seen the answer which the Chancellor of the Exchequer gave yesterday to a Question dealing with this matter. I think I must leave the matter there.
    Mr. Boyd: Is not the Minister aware that the White Paper to which he has referred relates only to officers and civil servants? Will a statement be made in regard to other ranks?
    Mr. Lloyd: On the whole question of Service pay and pensions I must stand by what my right hon. Friend said yesterday. There is a certain ground for hope in that.
    Captain Pilkington: Will my right hon. and learned Friend at least undertake that the Government will reconsider this matter before the next Budget?
    Mr. Lloyd: I would refer my hon. and gallant Friend to what the Chancellor said yesterday.
    Lieut.-Colonel Liptonasked the Minister of Defence what reply he sent to the letter of 16th April last from the Officers' Pensions Society about officers retired under the 1919 code.
    Mr. Selwyn Lloyd: An acknowledgment was sent on my behalf to this letter which did not, in terms, ask for a reply. It commented at considerable length on the debate on 6th April in another place on the retired pay of the officers mentioned in the hon. and gallant Member's Question.
    Lieut.-Colonel Lipton: Is not the right hon. and learned Gentleman aware that the officers concerned feel that they have been grossly deceived by what they regard as a shocking breach of faith on the part of the Government? Is he not also aware that Lord Salisbury gave a pledge in another place that he would bring this matter to the personal attention of the Prime Minister? Is this the only outcome of all that?
    Mr. Lloyd: I think the hon. and gallant Gentleman should again read the Chancellor's Answer yesterday, which covers this matter.

    National Service
    Mr. Swinglerasked the Minister of Defence if he will take steps to reduce the period of National Service.
    Mr. Selwyn Lloyd: I have nothing to add to what my right hon. Friend the Prime Minister and I said on this subject in the debate on 28th April.
    Mr. Swingler: Are not the Government proposing to bring forward any programme for the reduction of the conscription period? Are we to take it that the Minister is perfectly satisfied with the present position; or what measures will he take to reduce this burden?
    Mr. Lloyd: If the hon. Gentleman will read again what took place in that debate, he will see the very good reasons that were put forward for not taking action in the matter at the present time.
    Mr. Shinwell: What possible reason can there he now for not agreeing to this request? Have we not reduced our commitments substantially? [HON. MEMBERS: "No."] Has the international situation not improved, according to the Government's own estimate of the situation? Is the right hon. and learned Gentleman—[HON. MEMBERS: "Speech."] Mr. Speaker, there is only one person in this House who can prevent me from speaking, and that is yourself. Is the right hon. and learned Gentleman aware that the West German Government have now decided, in the sphere of conscription, on a period of eighteen months? Why should our men serve for two years?
    Mr. Lloyd: I invite the right hon. Gentleman to consider again the arguments that were used in April. I then reaffirmed the Government's undertaking, and our desire, to reduce this burden as soon as and as much as possible; but it is a question of timing.

    N.A.T.O.
    Mr. Swinglerasked the Minister of Defence the latest instructions he has given to the United Kingdom Representative on the North Atlantic Treaty Council concerning the equitable sharing of manpower and financial burdens of defence between the member States of the Treaty Organisation.
    Mr. Selwyn Lloyd: I am not prepared to disclose the confidential instructions
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    which are given on this and other matters to the United Kingdom representative on the North Atlantic Council.
    Mr. Swingler: May we know whether any instructions have been given at all?
    Mr. Lloyd: The hon. Gentleman can certainly take it for granted that instructions have been given to our representative.
    Mr. Swingler: On this matter?

    Expenditure
    Mr. Shinwellasked the Minister of Defence whether the first half-year of the operation of his Estimates indicates any reduction in defence expenditure in the current year.
    Mr. Selwyn Lloyd: If the right hon. Gentleman will put this Question down again in October, when the first half of the current financial year will have been completed, I will do my best to give him an Answer.
    Mr. Shinwell: Does that mean that since the last Defence Estimates were presented to the House the right hon. and learned Gentleman has had no indication whether defence expenditure has been reduced? Has it been reduced since the beginning of the financial year, or does he expect any reduction this year? Can he not give us any information? Does he not know what he is doing in his own Department?
    Mr. Lloyd: If the right hon. Gentleman will look again at the Question which he put down, he will see that it refers to the first half-year. The first half-year is not yet over.

    Nuclear Weapons (Scientific Advice)
    Mr. Emrys Hughesasked the Minister of Defence to what extent he consults with eminent scientists in planning the defence of this country against the possibility of attacks by nuclear weapons.
    Mr. Selwyn Lloyd: Effective arrangements exist, of which full use is made, for the Government to receive the advice of eminent scientists with regard to defence matters.
    Mr. Hughes: Will the Minister tell us whether Lord Cherwell is part of these "effective arrangements," and whether Lord Cherwell has given advice upon National Service, which he has recently described as intellectually sterilising the youth of this country for a period of two years?
    Mr. Lloyd: I think that, on these matters of the channels for advice by eminent scientists, I should like to see any question of the hon. Gentleman on the Order Paper.

    Soviet Military Helicopters
    Mr. Emrys Hughesasked the Minister of Defence whether he will make a statement about the Soviet military helicopters recently displayed.
    Mr. Selwyn Lloyd: I have nothing to add to the reply which I gave to my hon. Friend the Member for Hendon, North (Mr. C. I. Orr-Ewing) on 6th July.
    Mr. Hughes: But is not the Minister aware that that reply did not apply to helicopters? Does he not know that the Soviet Air Force recently displayed helicopters capable of carrying fifty people? Is he not further aware that these are exactly the kind of helicopters that are wanted on the West Coast of Scotland? How does he explain the fact that Soviet Communism seems to be very much more efficient than British capitalism in producing them, and does he not think that it would be a good thing to exchange Scottish herrings for Soviet helicopters?
    Mr. Lloyd: If there is any possibility of the hon. Gentleman being able to arrange that deal, I certainly think it could be considered.

    Cenotaph (Saluting)
    Mr. Biggs-Davisonasked the Minister of Defence what orders are given to members of the Armed Forces to salute when passing the Cenotaph in Whitehall.
    Mr. Selwyn Lloyd: There is nothing in general Service Regulations covering saluting when passing the Cenotaph. The Brigade of Guards, however, have their own special orders, which apply to the Household Brigade only, for all ranks to salute when passing the Cenotaph.

  UNITED NATIONS

    Trade with China (Security Controls)
    11 and 12. Mr. H. Wilsonasked the Secretary of State for Foreign Affairs (1) what discussions he has had with the other Governments concerned since July, 1954, with a view to ending the United Nations decision of 18th May, 1951, about trade with China;
    (2) if he will now take the initiative in proposing that the resolution of the United Nations of 18th May, 1951, relating to trade with China be now rescinded.
    The Secretary of State for Foreign Affairs (Mr. Harold Macmillan): The situation in the Far East has not yet justified our taking up the question of making any changes in the security controls on trade with China.
    Mr. Wilson: Is not the right hon. Gentleman aware that this boycott was placed on trade with China on 18th May, 1951, because of China's intervention in Korea, and that that intervention has been over for two years? Is he also aware that last year we were told that the boycott was now due to Chinese intervention in Indo-China? Does not the right hon. Gentleman think that British commercial interests are being seriously prejudiced by illegitimate international pressures in this connection?
    Mr. Macmillan: This was a Resolution of the Assembly, and it can be rescinded only by the Assembly.
    Mr. Wilson: Yes, but is not the right hon. Gentleman aware that in the second of my Questions I asked him if he would now take the initiative in proposing to the Assembly that this now quite obsolete boycott should be rescinded?
    Mr. Macmillan: This is one of the many difficult problems in the Far East, and we shall have to use a certain amount of patience and try to treat them as a whole.

    Charter (Revision)
    Mr. Usborneasked the Secretary of State for Foreign Affairs what instructions he has given to the United Kingdom representative at the United Nations on the question of revising the United Nations Charter.
    Mr. H. Macmillan: The question of holding a review conference will be discussed by the General Assembly at its next session. Her Majesty's Government do not consider that such a conference would be in the interests of the United Nations at the present time. Our consultations with other member Governments have shown us that this view is widely shared.
    Mr. Usborne: Whereas that is evidently the view—and I regret it, though knowing the difficulties—of the Government at this moment, is it not nevertheless true that the Foreign Secretary has his mind open to the possibilities of changing and strengthening the United Nations more in the direction of the world government that he said that he wanted it to be, as soon as the appropriate moment and occasion should arise?
    Mr. Macmillan: I think that the position was very aptly summed up at San Francisco by the Indian representative, who said that if the Charter had to be revised it would require agreement, and that if there was agreement there would be no need for revision, I think the real thing is to try to get progress in dealing with some of the fundamental problems, and that would then lead to a better situation in regard to the Charter itself.
    Mr. A. Henderson: Would the Secretary of State agree that the obvious intention of the framers of the Charter was to secure universality, and even though it may not be possible to amend the Charter in the next twelve months,. will the Government press for a situation which would bring all States within the ambit of the United Nations?
    Mr. Macmillan: I think that it all hangs on what I have said. I have every sympathy with that, but I think that every step which will help to improve the international situation generally will be a step towards the bettering of the United Nations.

    Economic Development Fund
    Mr. A. Hendersonasked the Secretary of State for Foreign Affairs whether he is now in a position to make a statement the latest report on the creation of a special United Nations Fund for Economic Development.
    Mr. Blenkinsopasked the Secretary of State for Foreign Affairs whether he is now able to make a statement as to the contribution Her Majesty's Government are prepared to make toward the establishment of the Special United Nations Fund for Economic Development.
    The Joint Under-Secretary of State for Foreign Affairs (Lord John Hope): Her Majesty's Government's attitude towards the principle of the fund remains as stated in my reply to the right hon. and learned Gentleman on 13th June. It would not be appropriate to reach final conclusions on the detailed structure of a fund when the conditions for its establishment do not yet exist; nor can I indicate the amount Her Majesty's Government would be prepared to contribute in hypothetical circumstances.
    Mr. Henderson: May I ask whether the Government are now prepared to support the establishment of this fund, provided that other countries make their contribution, without waiting for the achievement of an agreement on world disarmament? Is that still the position?
    Lord John Hope: The position is that we stand by the Resolution passed by the General Assembly on 7th December, 1953, which specifically laid down progress in disarmament as a condition for supporting the fund. That is our position and we stand by it.
    Mr. Blenkinsop: Is the Minister not aware that that will be widely regarded as pouring cold water on the scheme? May not this country give some effective leadership at this time, and before the Geneva Conference takes place, so that our position may be known throughout the world as one of supporting the scheme irrespective of decisions on disarmament?
    Lord John Hope: It is not reasonable to describe adherence to a United Nations Resolution as pouring cold water on anything.

    CYPRUS (ATHENS RADIO BROADCASTS)
    Major Wallasked the Secretary of State for Foreign Affiars what reply he has now received from the Greek Government, in reply to his protest, as to the positive measures they are taking to stop the spreading of sedition in Cyprus by Athens Radio.
    Mr. H. Macmillan: The Greek Minister of Foreign Affairs, in a letter dated 28th June, asserted that the Greek Prime Minister and he himself had never failed to condemn the use of force and all aggressive acts, and that the Greek Government were in no way responsible for the aggravation of the situation in Cyprus. The Minister claimed that the Greek Government did everything in their power to prevent insults, personal attacks and incitements to violence from entering the broadcasts from Athens Radio, but argued that they could not accept responsibility for the reproduction by the broadcasting station of information and comments published in the Press.
    Major Wall: Has my right hon. Friend made it clear to the Greek Government that the outpourings of Athens Radio are not conducive to a good atmosphere for starting the talks on the problems of the Eastern Mediterranean?
    Mr. Macmillan: Yes, Sir; we have done so, and I very much hope that the Greek Government will do their best to prevent the dissemination, even under the guise of news, of what is really terrorist propaganda.
    Mr. E. L. Mallalieu: Does not the right hon. Gentleman agree with the statement of his right hon. Friend the Minister of State in his own Department, made to me in the House three months ago, that there has been no falling-off in Greece of good will towards this country?
    Mr. Macmillan: I am glad to feel that, in spite of difficulties over Cyprus, there is a long tradition of friendship between Greece and Great Britain. We have made very great sacrifices and efforts for the Greek people, which they, thoroughly recognise, and I am only hopeful that a better situation may arise out of some settlement that may be reached at the conference which we have called.

    ICELANDIC FISHERIES DISPUTE
    Major Wallasked the Secretary of State for Foreign Affairs whether he is yet in a position to make a statement regarding the inquiry by the Organisation for European Economic Co-operation into the Icelandic fishing dispute.
    Lord John Hope: No, Sir; the discussions within the framework of the Organisation for European Economic Co-operation are continuing.

    B.B.C. SERVICES (EAST GERMAN INTERFERENCE)
    Mr. C. Hughesasked the Secretary of State for Foreign Affairs if he will make a statement concerning the approach made by Her Majesty's Government to the Soviet High Commissioner on 20th January, 1955, on the question of the interference of the East German broadcasting station with the British Broadcasting Station's Welsh, North of England and London Home Services.
    Mr. Watkinsasked the Secretary of State for Foreign Affairs whether he will make a further statement as to representations he has made about the interference of the East German broadcasting station with the Welsh Regional station of the British Broadcasting Corporation.
    Lord John Hope: The Soviet High Commissioner not having replied to the approach of 20th January, Her Majesty's Ambassador took the matter up with him personally on 20th May. The Soviet High Commissioner promised to look into the case. In a written reply on 24th May, the Soviet High Commissioner informed Her Majesty's Ambassador that the matter had been referred to what he called "the competent agencies of the German Democratic Republic."
    Mr. Hughes: Is the Minister aware that there is still considerable interference with these home stations, and is it not the case that these wavelengths were allocated under the Copenhagen Agreement? Does he not think it advisable to consider calling another such conference to put an end to this chaotic state of affairs?
    Lord John Hope: The position is not a satisfactory one, and anything that we can do we shall, of course, do.
    Mr. Watkins: Will the Minister be kind enough to have a word with members of some of the delegations from that side who are at present in this country, and suggest that something should be done; or, at least, raise this matter in some committee of the United Nations?
    Lord John Hope: The Soviet High Commissioner is the man who could put this right if he wanted to. We all hope that he will do so.
    Mr. Callaghan: As the last contact was on 24th May, could not the Joint Under-Secretary get some fresh representations made, because the situation is not improving? If anything, it is getting worse.
    Lord John Hope: We will certainly consider that.
    Mr. Gower: Will the Joint Under-Secretary invite the Soviet High Commissioner to come here and hear the Welsh Home Service?
    Lord John Hope: Perhaps my hon. Friend will give that invitation himself.

  INDO-CHINA

    South Vietnam (Discussions)
    Mr. Warbeyasked the Secretary of State for Foreign Affairs what subjects he discussed recently with the Minister without Portfolio of the Government of South Vietnam.
    Mr. H. Macmillan: As these discussions were confidential, I am not in a position to give the hon. Gentleman this information.
    Mr. Warbey: Will the Foreign Secretary at least say whether they discussed the question of the participation of the South Vietnam Government in the talks on the holding of elections, which under the Geneva Agreement are due to take place not later than next week? Have the South Vietnam Government agreed to participate in these talks?
    Mr. Macmillan: I must ask the House to support me. If I were to conduct all conversations with ambassadors, visiting Foreign Ministers and other notabilities on the basis that they must be made public, that would make the position of the Foreign Secretary very difficult. At the same time, our position is very well-known, and we very much hope that the South Vietnam Government will enter into negotiations with the Government of North Vietnam—Vietminh—with a view to consultations regarding the holding of elections.

    Geneva Agreement (Situation)
    Mr. A. Hendersonasked the Secretary of State for Foreign Affairs whether he will make a statement on the situation in Indo-China in relation to the Geneva Agreement.
    Mr. H. Macmillan: Her Majesty's Government are much concerned at recent events in Laos. Despite the International Supervisory Commission's unanimous decision upholding the right of the Royal Government to administer the two northern provinces, of which my right hon. Friend the Parliamentary Under-Secretary informed the House on 6th July, the Communist Pathet Lao have recently launched a renewed attack on the Royal Government's troops in those provinces. Her Majesty's Government trust that the Pathet Lao do not now intend, in the face of the International Commission's decision, to prosecute their claims by force of arms.
    In Vietnam there have been no significant developments since the survey given by my right hon. Friend the Minister of State on 15th June.
    Mr. Henderson: Would the Foreign Secretary make it clear that Her Majesty's Government attach the greatest importance to the maintenance of a position which would permit of the implementation of the provisions of the Geneva Agreement for the holding of free election in all the Associated States?
    Mr. Macmillan: Yes. Her Majesty's Government are using all their influence with the Vietnam Government to ensure that consultations between the Vietnamese and the Vietminh should in fact take place from 20th July onwards, as provided in the Geneva Agreement. I do not think I can add to that answer except to say that we are doing all we can to ensure that those consultations should begin.

    s.s. "ANSHUN" (EGYPTIAN ATTACK)
    Mr. Ernest Daviesasked the Secretary of State for Foreign Affairs what reply he has received to the protest made to the Egyptian Government at the firing upon and interception of s.s. "Anshun" on 3rd July.
    Mr. Jannerasked the Secretary of State for Foreign Affairs whether he will make a statement on his protest to the Egyptian Government in respect of the attack made upon the s.s. "Anshun."
    Mr. H. Macmillan: A note of protest was delivered to the Political Director of the Egyptian Ministry for Foreign Affairs on 6th July. The note made it clear that Her Majesty's Government do not recognise the Egyptian claim to obstruct the right of innocent passage through an international channel even though it lies within Egyptian territorial waters.
    It referred to the protest made in the case of the s.s. "Argobec" which was stopped by shots across her bow on 10th April in the Enterprise Channel. It went on to point out that the present incident was even more deplorable since the fire of the shore batteries was evidently turned directly upon the vessel. It ended by making an emphatic protest against the unwarranted action of the Egyptian shore station in firing upon a British merchant vessel exercising her undoubted right of innocent passage, and by insisting that the Egyptian Government should issue the clearest instructions to the Egyptian shore station to prevent any recurrence of this and the earlier incidents. The right to claim compensation for damage was reserved.
    No reply has yet been received from the Egyptian Government.
    Mr. Davies: Since the facts in this case seem to be quite clear, is not this delay inexcusable? Are not the incidents likely to continue, however much we protest, if Egypt insists on continuing this illegal blockade of these waters? What steps are the Government taking to bring Egypt's attention to the need to bring this illegal blockade to an end?
    Mr. Macmillan: We have, of course, pressed for an early reply to our note, which was delivered on 6th July, and the Egyptian Minister of Foreign Affairs has informed Her Majesty's Embassy that the reply to our note, although not yet ready, will not be long delayed.
    Mr. Janner: If a satisfactory reply in respect of these acts of piracy is not received, will the right hon. Gentleman see to it that the matter is again brought before the Security Council of the United Nations? Will he also make certain—
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    and will he tell us how he can make certain—that none of the arms that Great Britain or the United States of America supplies to Egypt are to be used against our vessels when they pass legally upon their lawful occasions?
    Mr. Macmillan: I think that the hon. Gentleman would agree that perhaps the best thing to do would be to wait to see the reply before deciding whether or not it is satisfactory.
    Mr. H. Morrison: Whilst I agree with that up to a point—it depends when the reply comes and what its nature is—is it the case that we are still supplying arms to Egypt? Ought we to go on supplying arms when Egypt does this sort of thing? Is it not time, after all these years, that we challenged the blockade which is going on and which sooner or later will lead to a warlike situation?
    Mr. Macmillan: That is a rather wider question on which I think the right hon. Gentleman would not like to press me in answer to this Question. In regard to this matter, I feel that though we have waited six days it is not unreasonable. We must press for a reply, and base our action on the character of that reply.

    EUROPEAN COAL AND STEEL COMMUNITY (AGREEMENT)
    Mr. H. Hyndasked the Secretary of State for Foreign Affairs whether the Agreement concerning relations between the United Kingdom and the European Coal and Steel Community has yet been ratified by the six States members of the community; and what is being done to enable this country to play its full part under the Agreement when it comes into force.
    Lord John Hope: The answer to the first part of the Question is "No, Sir," although I am informed that the constitutional processes towards ratification in these countries are for the most part well advanced.
    The answer to the second part of the Question is that, by ratifying the Agreement, Her Majesty's Government have enabled this country to play its full part under the Agreement when it comes into force.
    Mr. Hynd: That does not sound very encouraging. Have the Government got all their machinery ready to take practical advantage of this Agreement when it is signed?
    Lord John Hope: I have answered the hon. Member's Question, and I think that my substantive answer covers his supplementary question, too.

    CZECHOSLOVAKIA (BRITISH-BORN WIVES)
    Mr. Gowerasked the Secretary of State for Foreign Affairs what news he has received, since 6th July last, about Phyllis Sispera and other British-born wives of Czechoslovak nationals; and if he will make a statement.
    Mr. H. Macmillan: I am glad to say that since the reply given by my right hon. Friend on 6th July, Mrs. Sispera has returned to her home in Prague and that the Czechoslovak authorities have granted her permission to return to this country with her children.
    The Czechoslovak authorities have stated that they will consider benevolently the cases of other British-born wives who wish to return home. The hon. Member can rest assured that we are doing all in our power to help.
    Mr. Gower: May I thank my right hon. Friend for that answer, and indeed, for the exertions of himself and his colleagues at the Foreign Office on behalf of these wives? Is it not a sad commentary on progress in the last hundred years that representations of this kind would not have been necessary in 1855?
    Mr. Hastings: When is it expected that this lady and her children will actually return to this country?
    Mr. Macmillan: I am not absolutely certain, but they have granted her permission to return, so that matter is fixed. With regard to the others, we have had a statement from the Czechoslovak Government that they will look benevolently on those cases, and what I want to do is to try to make sure those women are allowed to return. That is the most important thing, and that is what we are striving to do by the best means in our power.

    ATOMIC POWER AND TRANSPORT (EUROPEAN CONFERENCE)
    Mr. Peartasked the Secretary of State for Foreign Affairs if he will issue a White Paper concerning all aspects of the proposed six-Power Conference on a European organisation for atomic power and transport.
    Lord John Hope: This has already been done. Command Paper 9525 was published on 5th July.
    Mr. Peart: Will the Minister see to it that all hon. Members will be fully acquainted of any further facts, and that no decision will be taken by the Government which commits us to any integration, or may approve of it, until this House has fully discussed it?
    Lord John Hope: I have answered the Question on the Order Paper. I think that I had much better leave it at that. The hon. Gentleman can rest assured that nothing at all rash will be done.
    Mr. P. Noel-Baker: Can the hon. Gentleman say whether the White Paper includes the remarkable report, prepared by M. Armand of the French railways, on Europe's fuel resources, and if not, will he lay it as a White Paper?
    Lord John Hope: I will certainly look into that.

    BRITISH SUBJECT, NEW YORK (DETENTION)
    Mr. Zilliacusasked the Secretary of State for Foreign Affairs whether he is aware that Mr. Cedric Belfrage has since 13th May been held in West Street Federal Prison, New York City, New York, by the United States Immigration Department, pending the hearing of his appeal against deportation for being allegedly a member of or affiliated to the Communist Party in 1937–38; and whether, in view of the fact that Mr. Belfrage has never been sentenced by any court nor even charged with violating any law, he will make representations to the United States authorities to release Mr. Belfrage pending the hearing of his appeal against deportation.
    Lord John Hope: A deportation order was issued against Mr. Belfrage on 12th May under Section 241A6 of the United States Immigration and Nationality Act, which provides for the deportation of an alien who is, or at any time after entry has been, a member of or affiliated with the American Communist Party. United States law authorises the detention of an alien declared deportable, and there is no obligation to grant bail. Mr. Belfrage's detention is thus in accordance with United States law.
    With regard to the appeal, this was dismissed yesterday. It is now open to Mr. Belfrage to appeal to the Supreme Court.
    Mr. Zilliacus: Does the hon. Gentleman realise that Mr. Belfrage has denied on oath that he is a Communist, and is it not improper to keep a man in prison indefinitely without sentence or charge and to refuse him bail? Will not the Government show the same zeal in this case as they have, very properly, and with the support of all of us, shown in the case of Iron Curtain prisoners?
    Lord John Hope: As I said, nothing has been done against the law. As for continued detention without bail, the Americans know that we do not like an undue delay in those circumstances. I have no doubt that they will take notice of what the hon. Gentleman and others have said in that connection.

    H.M.S. "GLASGOW" (COURTESY VISIT, POLAND)
    Major Beamishasked the Secretary of State for Foreign Affairs what restrictions the Polish authorities placed on people who wished to visit H.M.S. "Glasgow" on visitors' day recently at Gdynia; approximately, how many people were guests on board that day; how many of them were British born; and if, when similar courtesy visits take place, he will, in future, seek assurance from countries with Communist Governments that no attempt will be made to make it difficult or impossible for British people to be guests in British ships.
    Lord John Hope: Previous to the arrival of H.M.S. "Glasgow," Her Majesty's Ambassador at Warsaw received an assurance from the Polish Government that anyone who applied for
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    permission would be given a pass to enter the dockyard. I have no evidence that persons of British birth were unreasonably prevented from going on board; but I understand that some may have applied too late for the necessary pass. One thousand five hundred people, mostly in organised parties, visited the ship on the two days on which she was open to the public. One British-born woman is known to have visited the ship.
    With regard to the last part of the Question, I do not think that one can here and now decide what assurances should be asked for in the event of future visits.
    Major Beamish: While it is true that the hospitality provided in Poland for the crew of H.M.S. "Glasgow" was generous in every way, is it not most unfortunate that out of seventy or eighty British wives of Poles living in Gdynia, of whom about half visited a football match which a team from H.M.S. "Glasgow" played against a Polish naval team, only one was able to go on board the British ship because of the difficulties put in their way by the Polish authorities? If I send my hon. Friend some more information, will he look into the matter?
    Lord John Hope: Yes, I shall be glad to look into any information which my hon. and gallant Friend may send.

    CAPTURED GERMAN MILITARY RECORDS
    Mr. Elwyn Jonesasked the Secretary of State for Foreign Affairs when it is proposed to make available to historians and researchers the captured German documents, of which the British Government is joint owner, and which are now kept in the Pentagon Building in Washington.
    Lord John Hope: The captured German military records which are held in Washington by the United States Government are freely placed at the disposal of the authors of the official histories of the war both in the United States and in this country.
    Mr. Jones: Is there any reason why, ten years after the end of the war, this valuable historical material should not now be available to researchers in universities, such as the University of Munich, who are denied access to them? Why

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    are they still locked up in the Pentagon in Washington, and why cannot they be made freely available?
    Lord John Hope: There are still reasons connected with security.
    Mr. Jones: How is that, ten years after the war?

    BRITISH SUBJECT, RÉUNION (EXPULSION ORDER)
    Mr. Fenner Brockwayasked the Secretary of State for Foreign Affairs if he will instruct the British Consul to take steps to facilitate the presence of Manilall Jalabhay, a British subject, at his appeal in Réunion on 19th July against the decision of a lower court to exclude him from the island.
    Lord John Hope: Her Majesty's consular representatives at Antananarivo and Reunion were asked to inquire of the French authorities whether they would be prepared to permit Mr. Manilall Jalabhay to visit Réunion for the period of his appeal. I have now heard that the French authorities regret that they are not prepared to do this.
    Mr. Brockway: Whilst appreciating what the British Consul has done, which I believe has succeeded in permitting the brother of Mr. Jalabhay to go to the Island of Reunion, may I ask whether the Government will protest in the strongest possible form, first, against the deportation of a British subject, and, secondly, against the refusal to allow him to attend the court when his case is being considered?
    Lord John Hope: The hon. Gentleman's Question relates only to the second part of his supplementary question. About that I see no reason to protest. We have done what we could, and the French are perfectly within their rights in taking the course that they have taken.
    Mr. J. Johnson: Is the hon. Gentleman aware that no charge has been levied against this gentleman? He has merely been accused of practising jewellery, and there are thousands of jewellers in the island of his own nationality.
    Lord John Hope: He has been charged under a decree of 2nd March, 1940.
    Mr. Brockway: On a point of order. In view of the unsatisfactory reply, I wish to give notice that I shall take the earliest opportunity of raising this matter on the Adjournment.

  KENYA

    Situation
    Mr. Hector Hughesasked the Secretary of State for the Colonies if he will make a statement on the prospects of the restoration of order and peace in Kenya.
    The Secretary of State for the Colonies (Mr. Alan Lennox-Boyd): The prospects are encouraging in that there has recently been a marked improvement in the general security situation in Kenya as shown, for example, by the transfer to the Administration and police of responsibility for the maintenance of law and order in the Fort Hall and Thika Districts and by the decision of the Kenya Government to facilitate the establishment of African district political associations.
    Mr. Hughes: Has the right hon. Gentleman taken the opportunity of receiving the delegation from the Kenya Government which is now so usefully visiting this country, and, if so, with what result?
    Mr. Lennox-Boyd: I am, of course, in constant touch with the delegation, whose arrival in this country has been so warmly welcomed by every section of the community. I am confident, as they are, that the combination of a liberal policy and the determination in military answers to terrorists are yielding good results.
    Mr. J. Griffiths: In view of the improved position, which we all welcome, will the right hon. Gentleman now consult with the Kenya Government on the possibility of modifying the present emergency laws?
    Mr. Lennox-Boyd: I do not think the time for that has yet arrived, although I am constantly in touch with the Kenya Government to keep the situation under continuous review.

    District Commissioner, Lamu
    Mr. Alportasked the Secretary of State for the Colonies how many changes in the appointment of the district commissioner, Lamu, Kenya Colony, took

    1923
    place between January, 1950, and May, 1955; and the average period of the tenure of this office by successive district commissioners.
    The Minister of State for Colonial Affairs (Mr. Henry Hopkinson): There have been five changes; the average period of tenure has been eleven months.
    Mr. Alport: Is my right hon. Friend aware that these frequent changes make efficient administration in the colonial areas almost impossible? Has he any plans for ensuring that the tenure of office of administrative officers in circumstances such as these shall be longer than has been the average in many parts of the Colonial Empire during the last few years?
    Mr. Hopkinson: Yes, I quite agree, but there were special circumstances in this case. Two of the officers were moved on health grounds and another asked to retire. Both the Governor of Kenya and my right hon. Friend are very conscious of the need to maintain continuity in the appointment of district commissioners and district officers. It is the aim of the Governor to keep a district commissioner in a district for a period of five years, but I am sure the House will realise that there are particular difficulties in Kenya connected with the emergency which make it difficult to carry out what we hope will become normal practice.

  WEST INDIES

    Jamaica (Unemployment and Emigration)
    Mr. Hector Hughesasked the Secretary of State for the Colonies if he is aware that there is unemployment in Jamaica; that this unemployment has caused large emigration from that island; and his present plans for dealing with this problem.
    Mr. Hopkinson: My right hon. Friend told the hon. Member on 16th February that it is a regrettable fact that there is considerable unemployment and under-employment in Jamaica, and I am aware that this is one of the causes of emigration. The Jamaica Government is continuing its efforts to expand production and employment, and Jamaican Ministers intend to give priority to economic development, particularly in
    1924
    agriculture. They are at present reviewing a new five-year development programme, prepared last year by their predecessors.
    As hon. Members will know, an allocation of £3 million has been made to Jamaica under the Colonial Development and Welfare Act, 1955, to help financially with this programme. Mr. Nethersole, the Jamaican Minister of Finance, discussed other sources of finance with my right hon. Friend last month.
    Mr. Hughes: While thanking the Minister for that long and detailed reply, may I ask him whether he has taken the opportunity of discussing these problems with Mr. Manley, who has visited this country twice since the Minister gave me that answer in February; and, if so, with what results?
    Mr. Hopkinson: My right hon. Friend has had a number of discussions with Mr. Manley, whom we are very glad to welcome back in this country. The major part of them concerned matters affecting the citrus and banana industries which are, of course, among the agricultural products which we hope to continue to develop in the territory.
    Mr. Tilney: Does my right hon. Friend agree that unemployment is likely to continue unless capital investment can be stimulated in both agriculture and light industry? Is he aware that the financial incentive of tax-free holidays granted by the Government of Jamaica does not accrue to companies registered in this country? Would he bring that to the attention of our right hon. Friend the Chancellor of the Exchequer?
    Mr. Hopkinson: The points which my hon. Friend has raised have already been considered in the House on previous occasions, and they are constantly under consideration in the Colonial Office.
    Mr. Woodburn: Has the right hon. Gentleman any knowledge of the allegations that there are tourist rackets inducing poor people in Jamaica to come to this country under false pretences? Is anything done to give the people information about the facts before they part with their money to come over to this country?
    Mr. Hopkinson: Yes, Sir. We have heard rumours of that kind and the Chief Minister of Jamaica has recently told us that he has that question very much under watch in the Colony itself.

    St. Vincent (Arrowroot Industry)
    Miss Leeasked the Secretary of State for the Colonies through what agency the arrowroot planters of St. Vincent, West Indies, sell their product.
    Mr. Hopkinson: Through the St. Vincent Co-operative Arrowroot Association, a statutory body representing the growers and operating on a non-profit-making basis.
    Miss Lee: Is the Minister aware that the planters, who are shockingly badly paid, believe that the whole of their product is sold to one agency, that this agency in turn sells the whole of the product to an American agency, and that there is shocking profiteering in this double monopoly?
    Mr. Hopkinson: We have no evidence of shocking profiteering. This Association was set up by local ordinance by the St. Vincent Legislature. It represents all sections of the industry, including the small planters, and if any change is needed in its composition, that is something which ought to be taken up in St. Vincent itself.
    Mr. Allaunasked the Secretary of State for the Colonies how much workers on the arrowroot estates of St. Vincent, West Indies, earn per week; and what provision is made for them during periods of unemployment.
    Mr. Hopkinson: Men earn between about 22s. 6d. and 34s. a week, women rather less. There is no special provision during periods of unemployment.
    Mr. Allaun: Are not these disgraceful wages connected with the fact that the arrowroot has to be sold to a monopoly?
    Mr. Hopkinson: I do not think that wages have any connection with the arrangements for the sale of the arrowroot: that is on the information which we have. The industry itself is responsible for these arrangements for selling the arrowroot. This is a poor Colony. This industry is a seasonal industry which functions for only four months in the year, but there are other industries, such as Sea Island cotton and sugar, which provide work. Certainly there is unemployment or under-employment in St. Vincent. We are well aware of that, and we are also aware of the need to develop other industries, in particular, the banana industry, to take up that unemployment.
    Mr. Shinwell: How can we justify a colonial policy when such disgraceful wages are being paid? Will the right hon. Gentleman say whether he condones that policy or not?
    Mr. Hopkinson: As in other territories, the amount of wages, as very often quoted in the House, gives a totally false impression. Wages have to be related to the cost of living in the territory concerned.
    Mr. Alport: How do these wages compare with wages paid to those in administrative and Government service in the island?
    Mr. Hopkinson: I should like to have notice of that question.
    Mr. Speaker: Mr. James Johnson.
    Mr. J. Johnson: On a point of order, Mr. Speaker, since I have a Question—No. 61—on this subject, may I, before I ask Question No. 39, be allowed to ask a supplementary question now?
    Mr. Speaker: I called the hon. Member, and he can take advantage of his opportunity.
    Mr. Johnson: Is the right hon. Member aware that there is a monopoly board in the U.S.A., the Morning Star firm, under Mr. Muller, and that it is alleged that arrowroot sellers sell at 5½d. per 1b. but could get 1s. or 1s. 2d. and this has a direct connection with wages in the plantations? Will the Minister have an investigation to find what exactly is the wholesale market position in New York?
    Mr. Hopkinson: My right hon. Friend has already referred this matter to the Governor of the Windward Isles. If any further information transpires from that inquiry we shall certainly take action to remedy the situation so far as we can, but we must remember that the Association and this monopoly sale is regarded in some quarters as the best way of selling arrowroot in the United States. There are many competitors appearing, and this Association depends on a local ordinance passed by the local Legislature. In these matters we must be careful how far we interfere.
    Miss Lee: On a point of order. I wish to give notice that, because of the unsatisfactory nature of the Minister's reply and the conflicting evidence, I shall raise the matter on the Adjournment on the first opportunity.

  COLONIAL TERRITORIES

    Visitors from United Kingdom (Formalities)
    Mr. Gowerasked the Secretary of State for the Colonies what progress has been achieved in reaching agreement with the authorities in Colonial Territories in West Africa, the West Indies and elsewhere to enable persons domiciled in the United Kingdom to visit those territories without as many undertakings and formalities as hitherto.
    Mr. Hopkinson: I have nothing to add to the reply given to my hon. Friend on 2nd March last.
    Mr. Gower: Is it not unreasonable that it should be so much more difficult for United Kingdom citizens to go to these territories than for their citizens to come here, and, indeed, more difficult for United Kingdom citizens than for American citizens to go there? Does my right hon. Friend recall that Lord Chandos, when he was Secretary of State for the Colonies, promised to do all in his power to get that altered?
    Mr. Hopkinson: I am not aware of any promise of that kind made by my noble friend Lord Chandos. These are very largely matters of local competence and it has been the practice of Secretaries of State in the past not to interfere with them unless it was absolutely unavoidable. Of course, the principle of reciprocity arises to a certain extent, and that was the question which my noble Friend said he would consider.

    Research Expenditure
    Mr. Albuasked the Secretary of State for the Colonies why the amount spent on research out of moneys voted for colonial development and welfare was reduced last year.
    Mr. Hopkinson: The amount issued in 1954–55 was £1,173,381 compared with an average annual issue of £1,263,888 over the three previous years. This does not reflect a fall in the amount of research carried out in, or on behalf of, Colonial Territories. The difference in the amount issued is due in the main to a fall in the amount of capital expenditure required now that buildings for the larger new research organisations have been completed. Another factor is that some
    1928
    colonial Governments are now finding it possible to assume a greater proportion of the cost of their research work.
    Mr. Albu: Is the Minister aware that there are only 450 scientists in the whole of the Colonial Empire? In view of the great need for research particularly in tropical agriculture, does he think that the amount spent at present and the scientific manpower employed are adequate?
    Mr. Hopkinson: We are only too well aware of the shortage of skilled technical personnel of all sorts in the Colonial Territories, and are doing our best to attract them. Quite recently the House voted a sum of £8 million from C.D. and W. funds for colonial research for the next five years. According to my information the indications are that issues for the current financial year will be considerably above those of 1954–55.
    Mr. Hastings: Does not the right hon. Gentleman agree that the greatest possible service we can do for these colonial people is to show them how they can increase the productivity of their countries? Does he not feel that we should be wise to spend more money on that than on many other services to them?
    Mr. Hopkinson: Both my right hon. Friend and I are fully alive to the importance of research in the Colonial Territories. We are constantly pressing its importance and encouraging it wherever we can.
    Mr. J. Griffiths: Does not the right hon. Gentleman think that the time has come for consultation with representatives of the universities in the Colonial Territories and others responsible for sending students over here to urge the necessity for greater concentration upon the kind of education which will fill these vacancies in the Colonial Territories?
    Mr. Hopkinson: My right hon. Friend will certainly be glad to consider that suggestion.

    NIGERIA (TRADE UNIONS)
    Mr. J. Johnsonasked the Secretary of State for the Colonies whether he is aware that there is no freedom of

    1929
    assembly for lawfully recognised trade unions in Nigeria; and what steps he is taking in this matter.
    Mr. Hopkinson: No Sir. In the Federal Territory of Lagos there is complete freedom of assembly for trade unions. Elsewhere in the country a permit is required under the Police Ordinance for the holding of public meetings, but there are long-standing instructions to all concerned to facilitate the issue of general licences under this Ordinance to registered trade unions. The legislation now in force for Lagos has been commended to the regional Governments for adoption.
    Mr. Johnson: Is it not a fact that ten years after the war-time emergency, well organised unions, lawfully recognised, have still to apply for police permits before they can hold meetings? Is it not time to rescind this war-time restriction?
    Mr. Hopkinson: As I told the hon. Member, it has been rescinded in the case of Lagos by the Federal Government, and the Federal Government have commended to the regional Governments that it should also be rescinded in their territories. Whilst I sympathise very much with what the hon. Member has said, we must remember that there is a very large degree of self-government in these regions and, without wishing to shelter behind that fact, we must be careful to what extent we interfere in these matters.

  GIBRALTAR

    Blind Persons and Ophthalmic Out-patients
    40 and 41. Dr. Kingasked the Secretary of State for the Colonies (1) the percentage of blind persons in Gibraltar;
    (2) the number of attendances at the ophthalmic out-patients' clinic in Gibraltar in 1954.
    Mr. Hopkinson: The total registered blind population of Gibraltar is 115 persons, which is equivalent to less than a rate of 500 per 100,000.
    The number of attendances at the ophthalmic out-patients' clinic in 1954 was 22,842.
    Dr. King: Is the Minister aware that, according to Dr. Cass, an ophthalmic surgeon in Gibraltar, the figure for
    1930
    blindness there is about five times that which obtains in this country, and that that makes the work which the Department has been doing for civilians in combating eye disease extremely important?
    Mr. Hopkinson: The rate is in fact rather more than twice the United Kingdom rate, which is 205 per 100,000, and is a great deal lower than that in many other Mediterranean countries. The arrangements which have now been made will, I believe, entirely take care of the position in Gibraltar in relation to numbers.

    Ophthalmologist Service
    Dr. Kingasked the Secretary of State for the Colonies if he will reconsider his decision to cut down the ophthalmologist service in Gibraltar, in view of the heavy incidence of blindness in Gibraltar.
    Mr. Hopkinson: No, Sir. Adequate arrangements have been made to maintain this service at the existing standard.
    Dr. King: Surely the Minister is aware that representations have been made to him from the Roman Catholic Bishop of Gibraltar and many other people who express alarm that the excellent eye service which his Department has built up is now to shrink because it is to be handed over to the military?
    Mr. Hopkinson: The agreement on the ophthalmologist service between the Gibraltar Government and Her Majesty's Government will expire this autumn. We are satisfied that adequate and appropriate arrangements have been made to maintain the service afterwards at its present high standard. That will be done by making use of the military ophthalmologists in Gibraltar and other services which exist.
    Mr. Edward Evans: Is the standard definition of blindness in Gibraltar the same as that which applies in this country? There is a definition in the Blind Persons Act, and the figures would be quite valueless unless we had the same standard of comparison—the degree of blindness which is recognised as blindness in this country.
    Mr. Hopkinson: I think that is the case, but I should like to look into the matter. Perhaps I may be permitted to write to the hon. Member.

    ADEN PROTECTORATE (COLLECTIVE PUNISHMENT)
    Mr. Peter Freemanasked the Secretary of State for the Colonies whether his attention has been called to the bombing by the Royal Air Force of five villages in Southern Arabia on account of the failure of tribesmen to pay a fine in rifles and money; whether he will give instructions prohibiting such forms of collective punishment which impose indiscriminate hardship; and ensure that punishments are imposed only upon persons proved guilty of lawbreaking or violence.
    Mr. Lennox-Boyd: Yes, Sir, but I am not prepared in present circumstances in the Western Aden Protectorate to disallow collective punishment by air or other action. Every precaution is taken to ensure the safety of tribesmen against whose property it is decided to take action.
    Mr. Freeman: Is not this method entirely contrary to all sense of British justice—this indiscriminate bombing of innocent people who have done no harm and no wrong? Will not the Minister send a strong protest to those concerned on similar lines to that sent to the Egyptian Government, who have been bombing people in the Suez Canal area? Is not the attitude of the Government entirely contrary to the idea of justice in these days?
    Mr. Lennox-Boyd: I think that the comment of the hon. Member is a gross travesty of the facts. Collective punishment is imposed only when collective tribal responsibility for the crime can be ascertained. It is the only practical method of dealing with offences of this kind in the Protectorate, as successive United Kingdom Governments of very different political views have continuously held.
    Hon. Members: Nonsense.
    Mr. Burden: Is it not a fact that there is very considerable misconception about this matter, and that before any bombing takes place an area is prescribed, warning leaflets are dropped, and people are given at least 24 hours to evacuate these mud villages before action is taken?
    Mr. Dugdale: Is the right hon. Gentleman stating that it is the policy of the
    1932
    Government to bomb people for no other crime than simply refusing to pay fines?
    Mr. Lennox-Boyd: No, Sir. I said that when crimes had been committed—crimes take different forms—collective punishment of this kind is invoked, but, as my answer made clear, every precaution is taken to ensure the safety of tribesmen against whose property it is decided to take action. I think that right hon. Members who have had responsibility for difficult areas of this kind, which are not under our direct administration, and who know, for example, the Aulaqi country, where there has recently been a considerable amount of trouble, will recognise that where it is not possible to identify and arrest individual culprits it is essential to take action of this kind.
    Hon. Members: Shame.
    Mr. Stokes: Is the memory of the Minister so short that he does not recall the protests we raised when the Germans carried out the collective bombing of Lidice? Is he aware that most hon. Members will regard this as an absolute outrage, and that, if the authorities are not capable of collecting their fines in any other way, they certainly ought not to do it in this way?
    Mr. Lennox-Boyd: I have two answers to the vigorous supplementary question of the right hon. Member. The first is that this policy was also carried out by the Government of which he was a Member——
    Mr. Stokes
    Mr. Lennox-Boyd: —though, bearing in mind the practices under the Labour Government, perhaps his colleagues forgot to tell him so.
    Mr. Stokes: When?
    Mr. Lennox-Boyd: The second answer iS—[HON. MEMBERS: "Where?"] The second answer in replying to the supplementary question—[HON. MEMBERS: "Where?"]——
    Mr. Speaker: Order. The right hon. Gentleman has been asked a question. He ought to be allowed to reply.
    Mr. Paget: On a point of order, Mr. Speaker. The right hon. Gentleman has made a grave allegation. We asked him when and where this took place. Surely we are entitled to an answer?
    Mr. Speaker: The Minister was asked a question. He was in the course of replying to it when he was interrupted by cries to answer another question or a question arising out of his answer. He ought to be allowed to finish his original answer. Mr. Lennox-Boyd.
    Mr. Lennox-Boyd: I was in the process of answering both parts of the right hon. Gentleman's supplementary question. The first one was that this had been carried out by previous Governments—[An HON. MEMBER: "What has that to do with it?"]—both in Arabia, and in previous years on the North-West Frontier of India, where the circumstances closely approximate to those pertaining to Arabia. The answer to the second part of his supplementary question is that if the right hon. Gentleman, with all his past experience behind him, is prepared to compare this with the indiscriminate bombing of Lidice, he must have no prospect whatever in mind of ever assuming responsibility again.
    Mr. Stokes: As the Minister chooses to refer back to some date of which I have no knowledge—[HON. MEMBERS: "Oh."]—and probably under conditions entirely different, will he please tell the House precisely to what he does refer so that we may all have a clear understanding?
    Mr. Lennox-Boyd: Perhaps the right hon. Gentleman had better do now what I should have thought would have happened in most Governments: that is, consult his former colleagues.
    Mr. Alport——
    Mr. Paget: On a point of order.
    Mr. Alport: Is my right hon. Friend aware—
    Mr. Speaker: There is a point of order. Mr. Paget.
    Mr. Paget: A grave allegation was made by the Minister that the Labour Government had carried out this indiscriminate collective punishment. Will he either substantiate that or withdraw it?
    Mr. Speaker: That is not a point of order. It is a matter of debate and recollection. I cannot stretch my memory in these matters. In any case, it is after half-past three.
    Mr. J. Griffiths: May I ask the Minister——
    Mr. G. Wilson: On a point of order. Did you not call my hon. Friend, Mr. Speaker?
    Mr. Speaker: I was interrupted by a point of order, but I had called the hon. Member for Colchester. Mr. Alport.
    Mr. Alport: Is my right hon. Friend aware that the form in which collective punishment was extracted from the villages in Malaya by the former Labour Government caused very much greater hardship upon those concerned than the bombing, under very strict control, of mud villages in the Aden Protectorate? Will my right hon. Friend ensure that the facts of the method used by the Royal Air Force in this case are widely publicised so that people in this country are not led away by the idea that the Royal Air Force is taking part in what might be regarded as bad action against the villagers in the Aden Protectorate, which is not true?
    Mr. Stokes: Before the Minister replies, may I ask whether he is aware—[HON. MEMBERS: "Sit down."] I am asking a question. [Interruption.] Is the Minister aware that conditions prevailing in Malaya were entirely different and had nothing whatever to do with the collection of fines?
    Mr. Speaker: Order.
    Mr. Stokes: Shall I repeat my question, Mr. Speaker?
    Mr. Speaker: It is well after the permitted hour for Questions.
    Mr. Griffiths: You did call me earlier, Mr. Speaker. May I put my question now?
    Mr. Speaker: When I looked for the right hon. Gentleman to rise a second time, he seemed to be supplanted by his right hon. Friend the Member for Ipswich (Mr. Stokes). In those circumstances, as I cannot allocate priority between right hon. Gentlemen, I called the right hon. Member for Ipswich. I thought that the right hon. Member for Llanelly (Mr. Griffiths) had given up his right.
    I ask the House to bear with me in this matter. It is now after the time for Questions and we ought to get on with the

    1935
    day's business. Apparently, there have been various recollections about this matter in the House, and it is not a matter that can be thrashed out at Question Time anyhow. If there is a desire for debate, later opportunities will no doubt arise.
    Mr. Griffiths: I rose to ask a supplementary question. My right hon. Friend intervened before a reply was given to another hon. Member who was called before me. Since you did call me, Mr. Speaker, will you not permit me to put my supplementary question now?
    Mr. Speaker: If it will end the business, yes.
    Mr. Griffiths——
    Mr. Alport——
    Mr. Speaker: One at a time, please.
    Mr. Alport: As the right hon. Member for Llanelly (Mr. J. Griffiths) has admitted that his supplementary question was interrupted by the right hon. Member for Ipswich (Mr. Stokes) before an answer was given to my question, would it be possible now for an answer to be given to my question?
    Mr. Speaker: I do not know why the House is getting in such a tangle. Time is getting on. Mr. Griffiths—but I hope that the right hon. Gentleman will not prolong the discussion.
    Mr. Griffiths: I was going to ask the Secretary of State a question regarding the general charge he made about what happened under the Labour Government—it will be seen in HANSARD tomorrow. While accepting responsibility for all that happened in the time of that Government, may I ask the Minister to make available to the House the exact circumstances
    1936
    that prevailed on this occasion and the earlier comparable circumstances to which he referred?
    Mr. Lennox-Boyd: May I answer both questions? What my hon. Friend the Member for Colchester (Mr. Alport) said is entirely apposite and well worth consideration.
    Mr. Stokes: Irrelevant.
    Mr. Lennox-Boyd: It is very relevant. The fact that it was put forward in a rather quieter voice than that of the right hon. Gentleman does not rob it of its value. As regards what the right hon. Member for Llanelly (Mr. J. Griffiths) said, I am even higher on the list for Questions next Wednesday than I am today, and if a Question is put down on this matter I will, of course, answer it.
    Mr. Hamilton: That will be a change.
    Mr. S. Silverman: On a point of order. Is it not the invariable custom of the House that if an hon. or right hon. Member makes a statement about another Member, whether Minister or back bencher, and that statement is repudiated, the Member who has made the statement is expected either to substantiate or withdraw it? Are we not now in that position?
    Mr. Speaker: I think that the right hon. Gentleman has undertaken to do so if a Question is put down to him next Wednesday.
    Mr. Freeman: In view of the most unsatisfactory nature of the reply, and in view of this gross abuse of British justice, I intend to raise this whole matter on the Adjournment as soon as possible.
    Mr. Speaker: I wish that the hon. Member had said that a little earlier.

MONOPOLIES
3.38 p.m.
The President of the Board of Trade (Mr. Peter Thorneycroft): I beg to move,
That this House welcomes the Report of the Monopolies Commission on Collective Discrimination as a basis upon which Her Majesty's Government can formulate its proposals.
I hope to state the intentions of the Government with sufficient precision to leave no doubt where we stand upon the main issues involved in this Report. I shall, at the same time, refer to a number of questions, some of which are touched on in the Report and others not, about which we should value the views of the House, and some of which clearly require further consideration.
I would say, first, that I think we ought all to be grateful to the Monopolies Commission for this Report. It is probably the most useful Report we have yet had. It contains a majority and a minority opinion, and I think it is none the worse for that. These are matters of some complexity upon which intelligent men may hold different opinions, and, as I shall show, there is value in both the majority and minority findings in this Report. Indeed, I shall comment and draw upon them both in the solutions which I shall put forward.
I shall also watch with interest and sympathy, as always, what the right hon. Gentleman the Member for Huyton (Mr. H. Wilson) has to say in support of the Opposition Amendment to this Motion. It seems to me that to argue exclusively in favour of the majority Report and, at the same time, to support the system of registration which it specifically turns down, will be a remarkable intellectual exercise. As I say, we shall await with interest the way in which the right hon. Gentleman discharges that difficult task.
Let me start by putting this Report in the proper context. It is the first Report of this kind. The Monopolies and Restrictive Practices (Inquiry and Control) Act was passed by the Socialist Government, but passed upon principles which, I think, were generally agreed in the House. That Act provided for a case by case approach, but also included, and, in my judgment, rightly included, a Section, Section 15, whereby, after experience
1938
had been gained, a general reference could be made either of a practice or a group of practices.
Let me say in defence of the Socialist Party that it was not altogether its fault that progress in this matter in the six years of the Labour Government was lamentably slow. The Labour Government passed the original Act; they referred about ten industries to the Commission; they took action on one only, the supply of dental goods. In a final flurry they published a White Paper condemning all forms of resale price maintenance. There, I think, they were batting rather erratically and on the wrong wicket. I shall have a little more to say about the White Paper on Resale Price Maintenance later. However, whatever the reasons were, I do not think anyone could say that the Socialist record in this business was an impressive one, or that the Socialist Government pressed these policies with anything like the vigour with which they sought to eliminate competition in many kinds of business and to substitute statutory monopoly.
In the last Parliament, we thought it right to accelerate the work of the Commission. We doubled its size. We enabled it to work in groups, and—important in the context of today's debate—under Section 15 we referred, two-and-a-half years ago, a group of practices for general examination. At that time, on 23rd July, 1952, in a debate, I said, when talking about the case by case studies:
"… the Commission has found a complex system of restrictive arrangements affecting distribution, and they all had a strong family resemblance."—[OFFICIAL REPORT, 23rd July, 1952; Vol. 504, c. 568.]
It is this group of practices, found in a large number of industries, that we are discussing today.
The right hon. Gentleman has sometimes urged me—he urged me before the Election—to act in advance of a Report of this character. I think that that advice was wrong. I do not want to be pedantic, or to stick with absolute rigidity to the scope of this or any other Report, but I do believe that, in general, a Report of this kind is a prerequisite to any legislative action. These are complicated and controversial issues, and it is necessary to focus public opinion on them and to see what is the nature of the issues to be faced. I believe that it would be impossible to carry public support without some

1939
kind of an inquiry such as that which resulted in this Report. It was for this reason that we launched it two-and-a-half years ago, and it is for that reason that today we shall declare our policy upon it.
I come to the scope of the Report. Some critics say that it should have been much wider, but one cannot include everything in one Report, one cannot solve all the problems in one Blue Book. If we believed some of the comments we should have sought a solution at one blow to all the problems, from exclusive selling by the Chemists' Federation here in this country to level tendering for the Snowy Mountains project in Australia. If we had made references of that kind we should not have been having the debate we are today, and we should not have had it for a long time ahead. We must delimit the problem in some way.
This Report is not primarily concerned with either price maintenance or price rings as such, but with a network of discriminatory practices mainly used for the purpose of enforcing or pursuing these and other objectives. In view of the Amendment put down by the Liberal Party to the Motion, I would observe that I agree with what it says about price rings, and that I have already announced my intention to make a reference of that matter to the Commission.
I said that the Report is concerned with a network of discriminatory practices. Let me remind the House what these practices are. They are conveniently grouped in pages 11 to 13 of the Report, and they fall into six categories. The first category is that practice whereby a seller agrees to sell exclusively to an approved list of buyers. Agreements relating to chemists' goods and spare parts for typewriters fall into this category. Category V is the reverse. It is the counterpart for buyers of Category I for sellers. It consists of agreements to buy exclusively from a favoured list of sellers. There are wholesalers who agree to put on a stop list manufacturers whom they consider to conduct their business in a manner prejudicial to the wholesalers. To take another perhaps controversial but topical example, suppose local authorities combined to put on a stop list constructional steel contractors who engaged in the practice of level tendering. It might be right, but it would fall into this category.
1940
Category II is a combination of Categories I and V, whereby a group of buyers and a group of sellers agree to discriminate in favour of each other. This is what is known commonly as exclusive dealing in the full sense—in radio valves and motor cycles. Many examples could be found.
Next there are two categories, Categories III and IV, and both of them relate to resale price maintenance. Category III consists of an agreement to adopt a common policy of fixing resale price conditions to goods—not necessarily common prices, but a common policy that the goods should be price maintained. Category IV is the instance in which the parties are free to decide whether to fix prices or not, but agree that when they are fixed they will collectively enforce them. Category III is concerned, therefore, with policy and not with enforcement, and Category IV with enforcement but not with policy.
Lastly, there is Category VI, which is the aggregated rebates. They are simply a rather sophisticated form of preferential rebates to encourage exclusive dealing.
That then is the field, and I should like to start by saying one or two things about it. First of all, do not let us work ourselves up into too great a state of moral indignation about restrictive practices of this character. A closed shop in the coal mines, strict rules demarcating labour, as in the building industry or in the film industry, may be socially or economically sound or unsound, wise or unwise. But there is nothing whatever in those practices themselves which is either criminal or even morally repulsive, and it is the same in this case. Agreements to sell motor cars only to garages which have trained mechanics and agreements by newspapers to fix the distances between the vendors who sell their papers, may be good, bad or indifferent from the economic point of view, but no one can say that they are a sin.
My second general point is that there is a good deal of common ground between the majority and minority Reports. Both agree that some of these practices, at any rate, may operate against the public interest while some of them can probably be justified in certain cases. Both Reports agree, though they differ quite markedly as to the method, that a sensible

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method must be found for sifting those which are tolerable from those which are not.
Before I state the Government's approach to this problem, I should like to examine the two approaches which are contained in the Reports. I count myself very fortunate to have them both. They help us in our consideration of the matter and I thank those who wrote them with such care and such moderation. I know that they will forgive me if I make some comments on both the majority and the minority Reports.
I take, first, the minority Report. The minority favour registration of these practices, followed by a continuation of the same case-by-case approach which we are pursuing at present under existing procedure. I say at once that I think registration has a part, and I believe an important part, to play in any solution of this problem, but I do not really believe that registration and no more is an adequate solution. It casts the President of the Board of Trade, or some other authority, in the role of a kind of recording angel. He notes what is happening. He writes it down and shows it to the world but otherwise, without further guidance or change of emphasis, the existing machinery goes forward.
I believe that it was the hope of all of us that publication of the Section 15 Report, in the interests of industry itself, would enable us to give a rather more precise guidance on some, at least, of the complex issues which confront us. Therefore, my comment on the minority Report is that it is all right as far as it goes but, in my judgment, it does not go anything like far enough.
I come now to the majority Report. It is, of course, much easier to criticise any of these proposals than to put forward one's own, and I propose to put forward my own in a few moments. My first criticism of the majority Report is perhaps psychological. It may exist perhaps more in the phrasing than in the intent, but I detect an odour of criminality in certain paragraphs—the creation of a new range of criminal offences. I hope that the House will not think that I am making too fine a point, but let us remember what we are considering. I believe that we can get through the tangled arguments about these economic and commercial problems with rather less
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emphasis on the criminal code. I believe that we can find other ways of doing it.
My second comment is on a point of substance. There seems to me in the majority Report an absence of a solution—perhaps it was outside the terms of reference to find a complete one—to the question of individual resale price maintenance, part of Category IV. I want to deal with that separately. I am not going to debate the subject of resale price maintenance this afternoon, but the various Reports published on the subject and the various things said about it leave us on both sides of the House in a considerable dilemma.
The fixing by manufacturers of the retail price of their goods has been examined on three separate occasions over the last thirty years, by the Committee on Fixed Retail Prices in 1920, by the Greene Committee in 1930, and by the Lloyd Jacob Committee in 1948, and individual price maintenance has never been condemned by any of these Reports. Manufacturers, distributors, consumers, and the trade union movement, all gave evidence that they believed it to be in the public interest. The women's organisations—the National Council of Women, the National Federation of Women's Institutes, and the Women's Co-operative Guild—all gave evidence to the Lloyd Jacob Committee that, in their judgment, fixed retail prices afforded them certain marked advantages. Any Government faced with that evidence would or should hesitate before rejecting it, and I certainly do not propose to reject it in the context of this debate.
Here, then, is the dilemma which faces us—a powerful body of support, including consumers, in favour of the individual fixing of retail prices while, at the same time, for many of the goods the only effective method of enforcement is the collective arrangements which have been condemned by a six-to-four majority of the Monopolies Commission and by the Lloyd Jacob Report. In fairness to both the majority Report and to the Lloyd Jacob Report I should like to say that I do not believe that those who were responsible for either felt that they had given a final answer to the problem posed by that dilemma, but it is certainly for us to seek to resolve it.
The answer given by the right hon. Member for Huyton was given in the

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White Paper which I have already mentioned. His view was that individual resale price maintenance should be made illegal by statute over the whole field of trade and industry, subject to some undefined procedure for exceptions. Nothing was done about it. It was a view stated in a White Paper and it never proceeded to a Bill.
The view of the Trades Union Congress is embodied in the General Council's Report which was presented at the Annual Conference at Margate in September, 1952. That view, contrary to that of the right hon. Gentleman, was stated to be that
"… the individual manufacturer who wishes to prescribe retail prices for his products should retain the right to do so and should in the last resort be able to enforce these prices by taking price-cutters to the Courts."
That is something which, of course, they cannot do in many cases today.
On this point, I much prefer the advice of the T.U.C. to the advice of the right hon. Member for Huyton. I believe that the sensible course is not to declare resale price maintenance to be illegal, nor to abolish it fortuitously by the removal of all existing methods of enforcement. I believe that the right course is to examine urgently whether some other method cannot be devised for maintaining prices individually fixed, taking price-cutters where necessary to the courts in the last resort—which is certainly less open to criticism than the network of practices to which the Report refers. I make these comments on the minority and majority Reports not in any critical sense but to demonstrate some of the wider issues with which this Report confronts us.
I now come to our own proposals on this matter. I think the simplest thing for me is to state quite shortly and categorically what we propose to do. We intend to take power by Act of Parliament to require the registration of those restrictive practices which we shall from time to time specify. On the one hand, we shall not limit ourselves to those referred to in the Report, nor, on the other hand, shall we require all restrictive practices to be registered together as appears to be envisaged in the Amendment by the party opposite, because all would be drowned in a sea of paper. We shall select the ones we want and in the order we want. That is the Swedish
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system which has, in fact, met with considerable success.
We shall include in the ones for early registration the ones referred to in this Report, but we would also think it appropriate to include at an early stage agreements fixing common prices. With regard to those practices referred to in the Report, once the registration authority has called forward for registration any particular class of agreement, if the firms wish to operate or to continue to operate an agreement in this class they must register. Then the tribunal, with the information that the register makes available, will call upon them by a given date to come forward and make out their case for employing that particular practice.
May I make this as clear as I can. There are two stages. First, there is registration, when all agreements of a specified class will be registered and any firm wishing to operate such an agreement will be able to do so only if that agreement has, in fact, been registered. The second stage is examination and judgment, when the tribunal will select agreements for examination and specify the date and place of hearing at which agreements will have to be justified if they are to continue.
There are, here, two crucial issues on which a great deal of the discussion between the minority and the majority plays. Where does the presumption lie and what guidance should be given to the tribunal? Let me deal with the question of presumption. These practices in one form or another are all practices in restraint of trade, and as such they are of their nature liable at any rate to operate against the public interest. The answer seems to me not to declare them crimes or fix an arbitrary date at which all practices must stop which will not be kept—as there must be some procedure for exceptions—but to place the onus of showing that they are in the public interest in a particular case fairly and squarely on the shoulders of the men who wish to use them. I may say, in passing, that this approach has been powerfully supported by two very able leaders in the "Financial Times."
The applicant will, therefore, argue his case in front of the tribunal. If it decides in favour of the applicant he can go on, subject, of course, to any conditions or

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modifications that may be laid down, but if it decides against him then the practice must stop. It seems to me that an arrangement of this kind has some advantages over the views of the majority Report. While it places the onus where it should lie it keeps control over the timing and direction of the advance firmly in one's own hand. The work can, in the first instance, be concentrated where it is most desired.
Mr. Harold Wilson: We are trying to follow the right hon. Gentleman's new proposals on this matter, but will he tell the House what would happen in a case where there may be 600 or 700 of these restrictive arrangements, registered under one particular heading? Suppose this tribunal could not get round to the 600 or 700 in a year or, indeed, perhaps in ten or twelve years, would the association maintaining one of those restrictive arrangements be permitted to carry on with these practices until, finally, the tribunal should get to them?
Mr. Thorneycroft: That dilemma would be confronting us in any case under the majority Report. It is perfectly plain that some method of exceptions would have to be allowed. It seems to me that it would be wiser to enable the tribunal to concentrate upon the range of practices which we really wish to consign to them and so provide that they may be available for registration and examination first of all.
I recognise that this is a vast field, and that many important technical and complex problems do arise, not all of which are likely to be solved in the course of one debate. One of them I have already stressed as crucial. It is the precise guidance to the tribunal. It is, clearly, right that it should not be left without any guidance at all, in the interests of industry as of the tribunal. At this stage, there seem to me to be two extremes. At the one end, there are the four cases referred to as exceptions by the majority, on page 84 of the Report. That may not be a comprehensive list, but it is one where the majority thinks that these agreements are probably likely to operate in the public interest.
At the other end, there are practices like Category III which the minority Report itself condemns. Some indication must be given that the onus to be discharged in getting a Category III agree-
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ment through would be a very heavy one indeed. It might be right, and I ask the right hon. Gentleman, in view of his interruption, to bear this point in mind, that the agreements in this category should be the first to be registered and certainly among the first to be examined.
Another problem is, what kind of tribunal? I should welcome the discussion in the House this afternoon on this particular problem. Should it be a judge or a Minister who makes the final decision? There are powerful arguments on both sides, and I think it is essentially a question upon which the view of the House of Commons will be extremely valuable. Should there be any right of appeal?
What repercussions will all this have on the existing Commission? Clearly, it will have some effect upon the nature and the scope of its work. How should the work of the new tribunal be fitted in to the work of the existing Commission? At any rate, I hope the right hon. Gentleman will now realise that it was perhaps a little unwise and premature to press for a large expansion of the existing Monopolies Commission before we had this Report, and we could see the nature of the developments which lie ahead and which might, in certain circumstances, mean a shifting of the emphasis of the work.
Next, we must consider what is to happen when the tribunal decides in favour of a practice continuing, because it is clear in certain circumstances that would happen. A great deal of public criticism has focussed on the manner in which these things are done as well as on their purpose. Take, for example, the private trade courts. I acknowledge, as I am sure we all do, the desire of those who have these organisations to be fair, but there is something rather repugnant, at any rate to many, in that system. Our judgment is that even if we get a ruling of the tribunal that a particular practice should continue, a fairly radical alteration of these arrangements ought to take place.
I do not suppose it will be right for anyone to suggest that we should answer all these questions this afternoon, but they are very proper questions for debate and discussion. This Report does not pretend to propound the final answer in this field, but I hope I have said enough

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to make plain where we stand on the main issues involved.
What I have said fits into the main pattern of our commercial policy. Let no one mistake what are the objects of that policy. We reject both the rigid control of foreign transactions and the maintenance of a large network of physical controls at home, as advocated by the party opposite. We regard with suspicion both statutory monopoly and the erection of private restrictions upon competition.
The conditions of the 1930s do not persist today. The prime need for industrialists in those years was different. It was to search desparately for some stability in the shifting sands of economic circumstances. [HON. MEMBERS: "Oh."] Those conditions do not exist today. The principal industrial problem of today is not how to contain defeat but how best to share in the advance. Today, change is our ally. You do not help change by rigid controls, imposed either by Government or by a network of industrial restrictions.
It is for these reasons that we have pursued the aims we have, to remove the obstacles to trade abroad, to rid ourselves of the network of manufacturing controls at home and to eradicate abuses in the field of monopoly or restriction. We are, and remain, the party of free enterprise and competition, in an age when both are needed to the full.
4.12 p.m.
Mr. Harold Wilson: I beg to move, to leave out from "House" to the end of the Question, and to add instead thereof:
"endorses the conclusions of the majority Report of the Monopolies and Restrictive Practices Commission on Collective Discrimination, and calls upon the Government to introduce legislation at the earliest possible moment for the purpose of implementing those conclusions, and of ensuring the registration of all collective agreements which provide for minimum prices and the regulation of production and trade."
I should like to congratulate the President of the Board of Trade on his ingenuity, if not on the solutions that he has put forward. [An HON. MEMBER: "And on the clichés."] We are very familiar with the right hon. Gentleman, and we have noticed that the less he has of policy the more he works himself into
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a passion. It was after a debate about a year ago that the "Manchester Guardian" said of the right hon. Gentleman:
"Having nothing to say, he spun a cocoon of platitudes around the subject.… He will not go far as a Minister unless he can say nothing and make it appear like a revelation."
I must congratulate the right hon. Gentleman on making some advance in that direction this afternoon.
He decisively and firmly rejected the Report of the Monopolies Commission. [Interruption.] That was the most important thing that the right hon. Gentleman rejected. The few Government supporters opposite who have read that Report should read again the recommendations of the majority of the Commission. They will see that those recommendations have been rejected by the President of the Board of Trade. There have been very many occasions when the right hon. Gentleman has failed to measure up to a great opportunity affecting trade and industry, but I have never known him fail more lamentably than he has this afternoon.
Listening to him, I was bound to ask myself what had happened to all those brave promises that we heard during the Election. There was the Chancellor of the Exchequer, for example, in his broadcast on 21st May. I do not see the right hon. Gentleman here. He said then:
"we do not intend to tolerate monopolies or unfair price-rings."
More than 5 million people must have heard the right hon. Gentleman, and a sizeable proportion of them must have thought he meant it. Then, before, I gather, a somewhat smaller audience in his constituency, the right hon. Gentleman said:
"No private enterprise can function unless you deal with monopolies, restrictive practices and price-rings which are not in the interests of the public. I say quite firmly that we are in favour of dealing with them. If any of you hear of any cases, mention them to me."
A fat lot of good that would do.
We all agree with what the right hon. Gentleman said when he began his speech. The occasion for the debate is the publication by the Monopolies Commission of majority and minority reports which must be the most important reports on industry in our economic history. I do not think the right hon. Gentleman will deny that. It is not an exaggeration

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to say that the action taken by the House on the Motion and the Amendment can, in very large measure, determine the pattern of the whole of the private sector of industry, and can thus profoundly influence our industrial efficiency and standard of living for generations to come.
As the right hon. Gentleman tried to do, we have to put this Report into its historical setting. There was the Monopolies and Restrictive Practices (Inquiry and Control) Act of 1948, passed, the right hon. Gentleman said, by the Socialist Party. It was, of course, passed by Parliament; not without a little opposition and trouble from certain leading Conservative spokesmen. Under that Act the Commission was established in 1949. Very soon there were criticisms from both sides of the House that the Commission was operating far too slowly.
The right hon. Gentleman mentioned that we took action on only one Report of the Commission. I think he will recall that because of the time the Commission took to produce its first few Reports—in fact, only three Reports were before the Labour Government at all—the third of them was received only three weeks before the General Election of 1951. On one of those Reports we did what the right hon. Gentlemen has not done on any that he has received; we took firm legislative action to compel the industry concerned to drop its restrictive practices.
We had already recognised, some time before we went out of office, that the case-by-case approach, however valuable up to a point, would never be adequate. One of the main things which emerges from the proposals of the President of the Board of Trade this afternoon is that he is putting the clock back seven years, because he is going back to the case-by-case approach. Every one of these cases has to be considered separately by the tribunal, and apparently, until they are considered separately by the tribunal, they will be permitted to continue. That is what I understood the right hon. Gentleman to say. If I misrepresent the President of the Board of Trade's speech perhaps he will put me right.
Mr. P. Thorneycroft: The right hon. Gentleman seems to have written his speech before listening to mine.
Mr. Wilson: I did furnish myself with one or two quotations from the right hon. Gentleman which I still intend to put before the House and which may rather embarrass him. In what I have just said I was basing myself on what the right hon. Gentleman said this afternoon.
Is it not a fact that he is now going back to the case-by-case approach and that, therefore, any restrictive practice can continue indefinitely—almost till the end of time—until the tribunal examines it, as it will have to examine each case before it can make it illegal? [HON. MEMBERS: "Answer."] Since the right hon. Gentleman does not want to answer the question, it is clear what the answer must be.
Let me remind the House that we had decided, as a Labour Government, that the case-by-case approach was inadequate. Perhaps I may remind the House of a few words I used from that Box in 1951. I said then:
"Hon. Members in all parts of the Committee are coming to the conclusion, as I have, that the 1944 White Paper approach to the problem of monopolies and restrictive practices is not enough … If we are to tackle this problem with the urgency required, we shall need … general powers to deal with particular harmful practices, not in one firm or one trade association, but wherever they may be found in British trade or industry. That is why I shall shortly be laying before the House a White Paper with the Government's proposals for dealing with resale price maintenance … and it will be our intention to follow this with further proposals to deal with other types of restrictive practice.—[OFFICIAL REPORT, 16th April, 1951; Vol. 486, c. 1491.]
Of course, we did not remain in power long enough to carry that promise into effect. The present Government came into power, a Conservative Government, which was heavily committed on this question in its Election promises in and before 1951. The President of the Board of Trade himself, right from his "Tory Reform" days, was committed to fighting these monopolies.
There was "The Industrial Charter," published, we understand, and drafted by the Chancellor of the Exchequer. It said this:
"We condemn out of hand any price agreement designed to keep prices above the costs of the most efficient producers, or levies on more efficient firms to keep the less efficient."
Condemn out of hand! Nothing happened. We have waited four or five years and now there is to be the setting up of a tribunal which is to take another

1951
twenty years to condemn these practices out of hand. In fact, the Government waited fourteen months before making its general references to the Monopolies Commission. The Commission has taken two and a half years to say, however elegantly, what everyone already knows about these practices. This Government reject the recommendations of the Monopolies Commission and put forward sonic very different solutions.
May I remind the right hon. Gentleman—I hope that his mind is not completely closed to suggestions—of another quotation from "The Industrial Charter." It said:
"The Government must keep the arena clear for the free play of private enterprise. Enterprise, large or small, and the consumer, who has the right to exercise free choice, must not be steamrollered by those who attempt to corner and abuse economic power."
What right has the consumer under the practices exposed in this Report to "exercise free choice"? What are the Government doing, in the proposals that we have heard this afternoon, to protect enterprise, large and small, from the steam roller? Will they not be crushing it long before the tribunal gets around to them?
These were the promises on which the Tory Party got into power in 1951. What has happened since 1951. [An HON. MEMBER: "They got in again."] They got in again because too many people believed their promises about monopolies. Many people were taken in by the Chancellor of the Exchequer and the President of the Board of Trade. What has happened in these four years? In the first place, so far from clearing the arena, the Government have strengthened the position of some of the private monopolies. Action was promised against monopolies in the first Gracious Speech of the last Parliament. Nothing has happened. In the practices which are the subject of this Report nothing has happened. The right hon. Gentleman claims credit for his punctilious proceduralism in referring these practices to the Monopolies Commission. He is a great stickler for consultation and references to statutory bodies whenever it suits his purpose. But he did not consult the statutory Films Council when he reversed the previous policy on film circuits and set the arena clear for the free play of monopoly power by the Rank Organisation.
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There was the Statutory Films Council which the right hon. Gentleman could have consulted about that. He did not bother to consult it. He did not trouble to inform the House before we heard about it and pressed him on the matter. Then he denied that there was any change of policy. This is a case in which there was a strengthening of the monopoly without consulting the statutory council, and having changed the policy he tells the House that there is no change in policy at all. The right hon. Gentleman has always been very touchy about anything affecting the sovereign rights and privileges of the Rank Organisation. We can only wonder why.
Mr. Cyril Osborne: Nothing to do with timber.
Mr. Wilson: If the hon. Gentleman challenges me, I will deal with that. I shall be delighted to do so.
The right hon. Gentleman was talking just now about batting on a sticky wicket. Let me tell him that no Lancashire or Yorkshire batsman on a sticky wicket at Old Trafford ever dug his bat deeper in the blockhole and stonewalled more stubbornly than the right hon. Gentleman every time there was a proposal that the British end of the international oil monopoly should be referred to the Monopolies Commission.
This reference under Section 15 the President of the Board of Trade parades as a virtue. In his historical account he did not think it advisable to remind the House that the inclusion of Section 15 in the Act was vigorously opposed not only by Lord Kilmuir but by Lord Chandos—Mr. Oliver Lyttelton as he then was—who described such a reference as "a meaningless academic essay." I do not suppose Lord Chandos is any more reconciled to Section 15 now that he has read the Report.
But the right hon. Gentleman referred to it. It suited his purpose. He wanted delay. He wanted to avoid taking any action. He had the very difficult task—I sympathise with him—of reconciling the brave words of the Industrial Charter and the Tory Party's Election pledges with the pressures of the spokesmen of the price ring and monopolies who are very active in his party. We have just had the "Aims of Industry" document circulated on this question. Where I think we really feel sympathetic

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with him is in the fact that, having delayed for two-and-a-half years, he is still faced with the same problem. He still has to reconcile these promises with the pressures from behind him. He is now faced with the embarrassing fact that a powerful majority of the Monopolies Commission, after deep research and clear discussion of the issues involved, has come to the same conclusion as the Labour Government had reached on the evidence open to us four years ago.
Mr. P. Thorneycroft: When?
Mr. Wilson: Four years ago—April, 1951.
I had hoped that the President of the Board of Trade would take his courage in both hands. He will need to if he is to do anything firm about monopolies. The 1922 Committee has already had one scalp and we gather that it is in full cry after another. Obviously, the right hon. Gentleman would be faced with great difficulty if he were to take any vigorous action about monopolies.
I must remind the right hon. Gentleman that he himself is heavily committed on this question by statements which he made in the House of Commons as recently as last February, when he said that we must await the Monopolies Report and that
"where these practices are found to operate against the public interests, they will be firmly and inexorably eliminated."—[OFFICIAL REPORT, 24th February, 1955; Vol. 537, c. 1496.]
That is what we want to happen and preferably in our own life-time; and it will not under the sort of procedure which the right hon. Gentleman has in mind.
Since the right hon. Gentleman made that statement there have been other speeches. I have referred to the speech of the Chancellor of the Exchequer. During the Election, I understand that the Prime Minister had referred to him the question of a grocer in Birmingham—a humanitarian grocer—who wanted to sell tea to old-age pensioners on a nonprofit basis and who had his supplies cut off by the trade association. The Prime Minister was apparently shocked about this. He said that a Conservative Government would take appropriate action to deal with the matter. We were told that in the House by my hon. Friend the Member for Ladywood (Mr. V. Yates) last week.
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When are we to have appropriate action about this tea business? Will the Government take any action? How long will it be, under the Government's present proposal, before it will be considered illegal for a trade association to cut off supplies of tea to a grocer when he wants to sell it cheaply to old-age pensioners? Does tea come within the President of the Board of Trade's proposal? There was a firm commitment by the Prime Minister during the General Election.
Turning to the Report itself, I will not go into it in great detail. The right hon. Gentleman quite fairly summarised most of its main conclusions. He outlined six practices which the Monopolies Commission used to divide up their terms of reference. I think that the right hon. Gentleman did that quite fairly. But it is interesting to note that, after describing in detail how each of these six types of restrictive practices works, the Report lists in Appendix 2 a number of goods the supply of which appears to fall into one or more of these categories. They are in alphabetical order from agricultural machinery to wire ropes, baths to biscuits, carpets to confectionery, lime to linoleum, pins to petroleum products, millinery to memorials. Whatever the Welfare State may or may not succeed in doing, it is clear that these price rings succeed in pursuing the citizen literally from the cradle to the grave.
Then there are items which enter into the cost of houses, whether local government houses or houses built for the private owner occupier. Let us take the items listed in the summary: baths, bricks, cement, damp courses, electrical goods, fibre building boards, flat glass, flushing cisterns and associated equipment, glazed and floor tiles, heating boilers, and radiators, lead sheets and pipes, paint and paint materials, plaster board, salt-glazed pipes, sanitary earthenware, sanitary fireclay, and other clay ware. How long will it take the tribunal to get through all that lot? I should imagine that it would take very many years to deal with house building alone.
Using the same appendix, again, when citizens of this property-owning democracy come to furnish and equip a house, these are the items affected: from carpets, rugs and curtain rails to linoleum and refrigerators—all these in one sample

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list of the Monopolies Commission showing one or more of the six restrictive practices.
To make sure that their grip is tight enough, many associations use two or three or more of the six practices which have been listed. The Dental Goods Report showed that the dental goods manufacturers made use of five of the six restrictive practices in order to make sure that their grip was effective. The electric lamp cartel used all six restrictive practices to make certain that everything was tied up and nothing could escape.
I think the examples which I have given justify a statement which I once made to the House, and to which the President took exception, that British industry was "honeycombed with these practices." I remind hon. Members of all the cases mentioned in the debate on 24th February. I do not intend to outline them all again this afternoon, but I might perhaps mention one or two. There was the Mendelssohn case, a trader put out of business for selling tyres too cheaply; a garage proprietor in the West country, trapped by a snooper masquerading as a farmer into buying second-hand tyres slightly above the ring price; the seedy looking commercial traveller who wheedled a garage proprietor into selling him petrol below list price because he said he could not afford to keep his car on the road; the many cases quoted by my hon. Friend the Member for Rossendale (Mr. Anthony Greenwood); and, of course, the case of the humanitarian Birmingham grocer. This is British industry, or a very big slice of it.
We read of these business men at trade association dinners, for which the Chancellor of the Exchequer so largely pays, waxing eloquent about the virtues, economic, moral and even spiritual, of untrammelled free enterprise and the iniquities of State planning; yet these are the very people who, with the perverted aid of accountants and lawyers—and I believe it is perverted—have devoted their ingenuity and business drive to drawing up a system involving the detailed and intricate planning of large sections of industry and trade with a degree of thoroughness and of ruthlessness in enforcement which far transcends most of the war-time and post-war controls which were maintained by Government Depart-
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ments over British trade and industry. Indeed, the right hon. Gentleman himself, in his famous book, "Design for Living," went out of his way to rebuke these gentlemen who make so many speeches about private enterprise and then spend their private lives building up these monopolistic situations.
Planning? I confess that when I read this Report I have to admit that we on this side of the House and the Civil Service are amateurs at it compared with the professionals of these trade associations. The only difference is that we operated it, and shall operate it, for and on behalf of the community, with Parliamentary consent and under Parliamentary control, whereas these gentlemen operate it without statutory authority for and on behalf of private profit and in a manner which an impartial inquiry has shown to operate contrary to the public interest. That is the difference between us.
Naturally, the right hon. Gentleman could not read out to the House all the quotations from the Report which make it absolutely plain that in the minds of the majority these practices are contrary to the public interest. There may be one or two exceptions. There was the reservation on collective enforcement of price maintenance by Mr. Gifford and there was the Minority Report, but running through every one of the chapters, and especially the final conclusions, is the clear decision of the Monopolies Commission that these practices are contrary to the public interest.
The President did not accept that conclusion. He merely accepted the view that they might be contrary to the public interest, so he sets up this tribunal to spend its time over a period of many years doing the work all over again which the Monopolies Commission has already done.
I would remind him of the quotations in the Report when, for instance, it refers to one practice leading
"to the creation of a privileged group, subject to relatively little outside competition …";
when it refers to
"approved lists drawn up with criteria for admission which are arbitrary …";
when it talks about
"preventing experiment, protecting established traders from the competition of those who would otherwise be willing to introduce new techniques";

1957
when it quotes from the Commission's earlier judgment on the Dental Goods Report which used the words,
"an extreme interference with the freedom of the subject to carry on any lawful business."
These are the conclusions of the majority Report and in his speech this afternoon the President rejected them.
I want to stress one of the recommendations in the majority Report about which the President said nothing at all this afternoon. It is the view of the majority that legislation should be introduced to make it illegal for the trade associations to discriminate against Cooperative societies and other bodies who pay deferred dividends as a result of their trading. We find many cases here of trade associations cutting off supplies to Co-operative societies or insisting that they should charge higher prices in Cooperative shops compared with the prices charged in ordinary private enterprise shops.
This is condemned by the majority Report, but I wonder what will happen under the President's proposals? Will this problem be solved? Will this tribunal be given instructions about it? This is one of the practical questions which the President must face.
Our Amendment asks the House to support the majority Report and its recommendations. I would point out to the right hon. Gentleman that all the legislation proposed in this Report—the President seemed a little shocked by it and suggested that there was an air of criminality about it—goes much less far than, for instance, is the case in the United States and much less far than is the case in Canada. The right hon. Gentleman had no need to be very shocked about it.
If he rejects the Report, we must ask, how shall we outlaw these practices? He was right to ask how these practices arose and what inspired them. I think I agree with him—perhaps not all of my hon. Friends will—that in many cases they did not stem from greed or deliberate desire to exploit the consumer. There are some cases, of course, which arose from greed. On the whole, I think there were two main explanations. The first, as he said, was that they arose from fear and a desire for stability in an unstable and depressed world. The Report shows how many of them were born in the 1920s or
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developed in the 1930s, although it provides some shocking evidence of how they have been developed since 1945, when there has been no question of mass unemployment, depression and all the rest of it. The main reason for which these practices have developed is a fear mentality, a depression mentality.
There is a second reason and it is Empire-building on the part of trade association secretariats to justify their existence. Once there is a scheme of this kind it provides employment for a whole group of bureaucrats—the right hon. Gentleman is always against bureaucrats. Naturally, these bureaucrats want to go further in tightening up the enforcement, making the scheme work, so providing more jobs for themselves and for their like. Again, it is not a question of greed; these fellows are not wolves so much as jackals. As the right hon. Gentleman said, we are not living in pre-war days. The need in this country is to expand industry not to stabilise a small corner of an unstable market.
In previous debates the right hon. Gentleman has had a lot of fun about calico printing. [HON. MEMBERS: "Hear, hear."] I did not hear any "Hear, hears" from Middleton and Prestwich. We advised caution in the case of calico printing, only because textiles are almost—almost, but not quite—the only industry where there are still these fears and still these anxieties about the future, as a result of the Government's policy, or lack of it, in relation to textiles. At a time when four mills are closing every week and there are 60,000 cotton workers on short time, if recent Press reports are correct, there is an argument for caution and for going slow in that case.
Mr. William Shepherd: Will the right hon. Gentleman tell the House whether he persists in his view that we ought to reject the findings of the Commission on calico printing? Does he also take the view that in Lancashire many of the difficulties are not caused by restrictive practices in the industry?
Mr. Wilson: If the hon. Member for Cheadle (Mr. Shepherd) had not interrupted me, I was about to say a little more about calico and would have answered his question without wasting his time, or mine. If he recalls, we have never said that we rejected the Report of

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the Monopolies Commission. I challenge the right hon. Gentleman to produce evidence that we ever have. I have said on more than one occasion that the right hon. Gentleman should go slow in enforcing it.
That does not mean that we endorse all the complicated market sharing arrangements of the Calico Printers' Association. Of course we do not. Indeed, the right hon. Gentleman may remember attacks on me by the Press, including the "Manchester Guardian," for being the first Minister from the Dispatch Box to condemn these price-fixing arrangements in calico printing, yarn spinning, and the rest. Nevertheless, the President should recognise that where fear persists—and for good reason—in an industry, his duty is to remove that fear. If he did that, we should certainly support him in any action he wanted to take about these arrangements.
That is why we suggested that if the minimum price arrangements—and I am referring, only to the minimum price arrangements and not the whole structure; I include yarn spinning—are left in being until confidence in the cotton industry revives, they should still be subject to Board of Trade control to protect consumers and other sections of the industry.
Mr. P. Thorneycroft: Do I take it that the right hon. Gentleman would support the abolition of the percentage quantum system?
Mr. Wilson: Yes. I have made that clear on many occasions. It was purely the price arrangements which we had in mind—temporarily—until the right hon. Gentleman could bring confidence back to the cotton industry.
Mr. Thorneycroft: The right hon. Gentleman will realise that the substance and very centre of that Report was the percentage quantum system. This is the first time that the right hon. Gentleman has openly said that he would support the abolition of that arrangement.
Mr. Wilson: The right hon. Gentleman will see in the OFFICIAL REPORT of 24th February that I specifically referred to the price arrangements and to the price arrangements only, and did not mention this percentage system at all. If he has had a nice Election, misrepresenting what
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I said, then now is the time to put that right.
The vast majority of cases condemned in the Report are where there are no such anxieties and fears about the future. That is why we support the majority Report that action should be taken about them. Those are the industries where there are full order books, shortages in many cases, inadequate capacity, long deliveries and a sellers' market. Any case there might have been in those industries in the 1920s and 1930s for restrictive arrangements went many years ago. That is why we hoped that the Government would accept the majority Report, so that all these arrangements in tyres, tea, Star Chamber courts, would have been made illegal by the legislation proposed by the Report.
I want to say a final word on registration. The right hon. Gentleman seemed to think that I would have found intellectual difficulty about the proposals in the Amendment involving both the majority and the minority Reports. That shows that he did not study the Amendment. What we suggested is quite clear. It is that in respect of those items within the terms of reference of the Monopolies Commission, and there is a clear proposal that legislation should be introduced to make these practices illegal, we should have that legislation and that these practices should be made illegal.
The suggestion in the remaining part of the Amendment is that over the remainder of the field of British industry—that is, restrictive practices not covered by this reference—such practices should be the subject of registration. I do not think that the President himself entirely rejects our proposal about registration, except that he proposes to do it group by group. There is not the intellectual conflict that the right hon. Gentleman seemed to think there would be. Certainly, I do not think that registration of itself will do anything. The President is too optimistic if he thinks that the dental goods manufacturers would have ceased from their vicious practices just on the basis of registration.
On 24th February my right hon. Friend the Member for Leeds, South (Mr. Gaitskell), my hon. Friend the Member for Hillsborough (Mr. G. Darling), myself and others commended the Swedish experience to the House and gave details of that experience. We pointed out that, since 1947, 1,250 restrictive agreements

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had been registered in Sweden, 480 of these have been scrapped and 250 modified. In fact, the Swedish equivalent of the Federation of British Industries has set up a special department to advise its members on how to wind up their cartels and price rings. It will certainly be a revolution if we find the British F.B.I. setting up a similar department in this country. Perhaps, as a result of these proposals, we shall see that happen.
I hope that the President will think again about this proposal. He does not say when he intends to introduce legislation. Above all, he has not told us how the Tribunal will work. I put a question about that in the middle of his speech, but I did not get a clear answer. Is it the fact that under this tribunal every one of these restrictive arrangements, provided they are registered, will be allowed to carry on until the final tribunal can get around to examining them and perhaps wind them up?
If that is the proposal, I suggest that he is putting the clock back to 1948, that we are getting back to the case-by-case approach, and that it will be very many more years before anything is done about some of the scandalous cases which have been exposed. We thought that the President was taking too much time in referring this matter to the Commission. We thought that there was enough evidence at that time to introduce legislation to make these practices illegal. But he wasted three years and those three years have been wasted, because, having made the reference, he has rejected the Report.
If we are to be told that the only result is that we have turned full circle back to the case-by-case approach, I am bound to say that all the high hopes aroused by some of the President's statements in February and by some of the Government's Election promises will be utterly frustrated. I put it to the right hon. Gentleman that the Government are faced with a great challenge and a great opportunity. It is not too much to say that the future of British industry, its ability to play its full part in our struggle for economic survival, in our export trade, in its contribution to our national standard of living, in great measure depends on how the Government and the House rise to this challenge and opportunities.
In the fierce and ruthless struggle for world markets we cannot move at the
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pace required, unless we firmly take the decision that these self-imposed and obsolete hobbles on industry and trade must go. I have heard nothing in the President's proposals this afternoon to suggest that anything is to be done to remove these self-imposed and obsolete hobbles, except over very many years. I hope that the Government will look at this again and tell the House that they recognise that a decision has to be taken. That decision, on which the House will be asked to vote tonight, has already been delayed too long and, in our view, can wait no longer.
4.50 p.m.
Mr. Peter Rawlinson: In speaking in the House on the first occasion, my natural apprehension has been increased by the speeches of my right hon. Friend the President of the Board of Trade and the right hon. Member for Huyton (Mr. H. Wilson) who replied to him. In my attempts to avoid being controversial, I hope that I shall be able to pick my way gingerly between the "opposing powers."
I represent the constituency of Epsom, in which we have no monopolies except perhaps a permanent monopoly on the finest flat race in the world, and we have no restrictive practices such as they have in the enclosures at Ascot. I wish, therefore, to speak in this debate personally, and as a lawyer. I have been long enough in this House to appreciate that saying that one is a lawyer is not in itself a recommendation. I do not know whether that also applies to economists.
I also have been long enough here to appreciate that though this House may have no love for lawyers, it certainly has no love for people who pretend to be what they are not, and therefore, as a self-confessed lawyer, I would draw attention to the procedure of the Monopolies Commission when investigating the matters placed before it. I think that there are serious faults to be found here.
To a certain extent the Monopolies Commission must be a judicial body. It is in fact conducting a trial; and anyone on trial, whether it be a person of no reputation accused of some of the most infamous criminal offences, or a trade or association, surely is entitled to the ordinary perquisites of the ordinary English system of justice. I heard my right hon. Friend refer to "onus" and

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"presumption of guilt." There are, of course, two main rules in English jurisprudence and English Common Law; a presumption of innocence, and that justice shall not only be done but shall be seen to be done. Anyone who has been an advocate in a case which has aroused public interest must be horrified by the telegrams, letters, calls and abuse dispatched by persons before the evidence has even been presented, or before a verdict has been reached. I think that "presumption of guilt" are ugly and, indeed, alien words to introduce into any form of trial, whether it be an inquiry or a proper trial before a judge and jury.
No accused is required to provide the evidence against him. Every accused also has before him a prosecutor who is not the judge. In these cases before the Monopolies Commission, it appears that, in fact, the chairman prepares the indictment and the arguments against the defendant industry and then, after having prepared them, becomes the judge and proceeds to try the issue. As I understand it, the procedure is to collect evidence, which takes a matter of two or three years, at the expense of the industry accused. There is a special secretariat to produce that evidence and following its production there is a clarification hearing where the representatives of the industry are brought before the Commission and asked questions. Based upon those questions a public-interest letter containing the charges is sent out. Then, finally, comes the public-interest hearing, where the representatives of the industry charged can make their speeches and answer the question put to them.
It seems that in those circumstances we have what we have seen in other countries, a form of congressional committee, with no opportunity for witnesses to be called who may be cross-examined by the defendants. We have the chairman putting the questions and conducting the interrogation. How can it be but that the persons in that industry must surely believe that in fact the man conducting the inquiry and asking the questions must have made up his mind, even before it comes to trying the issue?
Therefore, when I hear my right hon. Friend say that these tribunals will be created, I earnesly hope that there will be a distinction made between the rôle of the
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prosecutor and the rôle of the judge. Certainly, let us establish some organisation whose duty it is to present the prosecution and collect the evidence, if necessary, from the industry concerned. Let there be a permanent staff whose duty it is to bring the evidence before the Commission. The matter can then be tried by the Commission which would decide on the evidence what is in fact the truth and what should be done with a particular industry. I suggest that it is only in those circumstances that a fair trial would be given to the industry concerned.
I am not so rash as to enter into a discussion on the merits of this Report. My talons are not sharp enough in debate for me to be able to argue with hon. Members about which is the better part of it, or what should be done. All I wish to say to the House is that of course wrong practices should be stamped out. Indeed, I should imagine that it is the desire of every hon. Member that wrong practices contrary to public interest should be removed. But I ask the House to consider that that should be done only when a fair and reasonable trial has been given and that the stamping out should be based, not on prejudice, but on justice.
4.55 p.m.
Mr. A. G. Bottomley: It affords me pleasure to follow the hon. Member for Epsom (Mr. Rawlinson). He had some doubt about the kind of reception the House would accord to him because he was a lawyer. I can tell him that this House judges a speaker upon his character, sincerity and ability. The hon. Member has not let us down, and we shall look forward to further contributions from him.
I wish to go a little wider than the questions with which the Report, as such, confronts us. The popular belief is that hon. Members opposite are anti-nationalisation and anti-trade union, and that that is their conception of a monopoly. Likewise it is thought that we on this side of the House feel that a monopoly in itself combines all the evils of big business. The issue is not so clear-cut as that, and, whatever politics there may be in this kind of argument, I think it necessary for us all to consider the matter more widely.
Large-scale organisation is here to stay, that is, if we want a standard of

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living as high as we enjoy today. In my judgment, that large-scale organisation is necessary also if we are to keep down the cost of articles by better technical know-how or by efficient business organisation. It is necessary if we are to avoid wasteful costs of competition. As an exporting nation, we must produce goods as efficiently and economically as possible in order to hold our own in the world markets.
Speaking as a trade unionist, I do not want there to be shoddy production and cheap labour in order that we may be able to compete in those world markets, which would result from inefficient organisation. We should all join in condemning the behaviour of organisations which keep up prices higher than is justified, with the consumer having no other choice. The Commission's Report itself condemns this kind of restrictive practice. For instance, we can condemn the behaviour of those monopolies and rings which supply local authorities and in respect of whom the Association of Municipal Corporations recently had to see the Minister. We can condemn, too, those manufacturers who refuse to sell to the Co-operative societies. Speaking as a co-operator and as one who buys the goods he requires from them, I think that if Co-operative societies are prepared to give back a dividend to the consumer out of the profits which they receive, that is something to be encouraged. I do not think that any monopoly ought to have the right to refrain from selling to Cooperative organisations.
To take a particular case of which examples have already been given in the House, there is a local figure in my constituency who wanted to reduce the cost of living by selling tyres below the standard price. His was a familiar story. He was hauled before the trade court, and he either had to pay the fine imposed by that court or be put out of business. I am sure that we should condemn that kind of practice.
As the Report says, although we condemn the practices of rings and trade associations, we still have to consider what we are going to do with organisations like Unilever and Courtaulds, which can adopt precisely the same methods as those adopted by the trade organisations without it being apparent that they are ganging up.
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I think it is pretty clear from the speech of the President of the Board of Trade today that we cannot expect much from this Government. I am not disappointed because I thought that would be the position. I remember that in the Gracious Speech in 1951 a monopolies Bill was promised. It did not come until 1953. During the debate on that Bill, I moved an Amendment which suggested that there should be four deputy-chairmen. The President of the Board of Trade said that he was happy with only two, but to the best of my knowledge the two have not been appointed to this day. That in itself clearly shows me that the Government were not really keen on doing anything effective about monopolies and their evil effects upon markets, and, in particular, upon consumers.
I suggest that the Government ought to consider introducing a Measure under which monopolies would be forced to give some kind of account of their work as, for instance, the National Coal Board has to do. It is not good enough to have a national newspaper carrying two columns of a report of the year's activities of a great monopoly. Why should there not be public accountability? Why should not the Press speculate on what is likely to be in the report of the I.C.I. in the same way as it does in the case of a nationalised industry?
The Government ought to bring pressure to bear on monopolies so that the searchlight of public opinion can be turned on them in the same way as it is on other public organisations. The consumer should be able to see that he is not being overcharged. He cannot be sure of that today. He can only be told that it is all a question of the market and of how much the consumer will pay. We know how that system operates; the monopoly fixes the price and the public either pays or goes without. As most of the articles are sheer necessities, there is no choice.
We hear a lot today about the necessity of the trade unions co-operating with managements. I would put it round the other way. I think that managements should co-operate with the trade unions. The workers should be clearly shown that any improvements brought about by large-scale organisations or monopolies are not harmful to their interests. It is my conviction—and I repeat it because

1967
I believe it to be true—that when, by the very nature of its production, an industry or organisation becomes a large-scale organisation or monopoly, the direction in which it ought to be going is public ownership. That has been argued in the past by those who helped to found the movement to which I belong. It has been uttered, too, by those Liberals who belonged to the Radical school of thought.
Industrial co-partnership may play a part in that development, but we are living in days of automation, and there may not be the workers to benefit from that co-operation. I wish to draw an analogy between the great institution of which we are all privileged to be Members and the development of our economic system. In the past, this House was the place to which only the privileged members of the community came. Members of Parliament and of the Government were drawn only from the selected few. As time progressed, we were able to elect Members who truly represented the nation.
Do hon. Members believe that we could have gone through and won the last war, could have come out of it a united nation and have the stability which we have today if we had not built up this Mother of Parliament? I suggest, therefore, that if we leave industry as it is today in the hands of those who organise monopolies, a privileged section of the community, the time will come when there will be such industrial unrest that the very standards which we have built up will be threatened We may even find that instead of being a great and prosperous nation we shall be faced with turmoil. That would be disastrous because we not only have to think of this Parliament and of our own society, but of the rest of the world who have followed us in establishing free Parliamentary institutions.
I believe that we have to look forward to a field of development in which power is taken away from the few and in which monopolies are organised in such a way as to render a public service. They should be accountable to the public. The way in which that can be done is to build up a vast working economic democracy akin to our Parliamentary democracy. I have sown some seeds. I have not gone into the Report as such, but I have looked at
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it very carefully and could comment fully upon it. However, I will not detain the House any longer because I know that there are many other hon. Members who wish to make a contribution to the debate.
5.8 p.m.
Sir Lionel Heald: Parliament has been set a difficult problem by the Report of the Monopolies Commission, and I believe that almost the whole House will agree that we ought to regard it calmly and impartially. The subject of monopolies and the matters which have been referred to the Commission under Section 15 of the Act are rather perplexing to the layman. He finds himself in a world of price cutting, rebates, loss-leaders and non-signers, and he rather wonders what it is all about.
As many of us found by personal experience during the General Election, the electors made perfectly clear to us their desire that this matter should be taken seriously and that if abuses were found to exist Parliament should see that they were remedied. It is in that spirit that we approach this matter today.
I am not going to adopt any kind of party line, and I am certainly not going to follow the kind of line adopted by the right hon. Member for Huyton (Mr. H. Wilson). I am going to try for a few moments to assist the House in deciding between two alternatives.
The first is the alternative which is put forward by the majority of the members of the Monopolies Commission. The other is the alternative put forward by my right hon. Friend today. I ask the House to decide between the two. It would be quite wrong to ask the House to reject out of hand the advice of the majority of that distinguished body, the Monopolies Commission, and, therefore, we must examine what they have recommended and treat it on its merits. That is what I propose to do.
In these things we ought to have some sense of proportion. From what we sometimes hear, one might think that the practices with which we are concerned today are really responsible for the whole of our economic troubles. But we ought to remember that these are not the only monopolies which exist, and that, if we were to rush into panic legislation against them, it might create a rather awkward precedent which could be used by a future Government that might hold views

1969
different from those of either of the present political parties. In consequence, certain monopolies might suffer. Therefore we ought to be very careful that we do not rush this legislation unwisely. The majority of the Commission has recommended that a criminal offence should be established, and my right hon. Friend has said that he rejects that suggestion. I want to explain to the House why I regard the institution of such a criminal offence as a most dangerous and undesirable thing.
We dislike the multiplication of criminal offences. We regard it as bad enough in itself, but we dislike even more the creation of anything which might be described as an absolute or automatic offence—something to which there is no possible defence. We had to put up with it in the Defence Regulations, but many hon. Members on both sides of the House would agree with me that we do not want to repeat such legislation if we can help it. As my hon. Friend the Member for Epsom (Mr. Rawlinson) emphasised in his admirable maiden speech, we feel that a man should always have an opportunity of defending himself, and if he is accused of malpractices we should not like him to be deprived of the opportunity of calling evidence and putting forward arguments to justify his actions. That is the first reason why we should object in principle—and why I do object in principle—to the institution of a criminal offence in this matter.
When we come to the creation of an absolute offence, the matter is even worse. It is not surprising to find that the majority of the Commission appears to have appreciated this weakness in its proposal. No doubt it is for that reason that it introduced the rather remarkable suggestion of applications for exemption. It is a rather novel principle in criminal law that one should establish a certain course of action as a crime and afterwards allow people to apply for exemption. It is a rather strange conception. One might almost imagine someone saying, "My mother-in-law is a very difficult lady. She is coming to stay with me next week. May I have an exemption from the Offences Against the Person Act?" That is very much the sort of mentality which seems to lie behind this proposal, and there is a most striking point to be made in connection with it.
1970
The right hon. Member for Huyton made great play with the suggestion that under the Government's proposal it would be years before all these practices could be dealt with. One wondered what the contrast was. I think that I appreciate it now. If the right hon. Member for Huyton had his way, he would make all these things illegal, and then tell people, "You can come along afterwards and apply for an exemption." How extraordinary it would be to hold that certain offences were illegal and the subject of criminal proceedings—and, possibly, even imprisonment—and then allow offenders against that law to say, "May I please have an exemption?"
The result of adopting this exceptional procedure was pointed out very clearly in an article in "The Times" today. Everybody would regard himself as entitled to exemption, and everybody would apply. This House would say, "We cannot allow a man to be condemned and fined—and possibly imprisoned—if he has put in an application for exemption." We should find ourselves in the same position as is imagined by the right hon. Member for Huyton, but to a much worse degree, because we should be hopelessly bogged down. In that case the initiative would come from the people themselves, whereas, under my right hon. Friend's proposals, the Government will take the initiative and decide in what order certain practices are to be dealt with. I suggest that my right hon. Friend has adopted a solution which is a much better alternative than that suggested by the Majority of the Commission.
Mr. R. T. Paget: Whichever form of tribunal is set up, the issue before it must be, what is the public policy? Has the right hon. and learned Gentleman felt that either judges or tribunals have been very successful in ascertaining that?
Sir L. Heald: I do not want to quarrel with the hon. and learned Gentleman over words, but it is not a question of public policy; it is a question of public interest—which is quite a different thing. It is possible to have evidence which allows one to decide what is the public interest, but nobody knows what is public policy except those who are actually deciding it.
Mr. Paget: I should like to know what evidence there can be of public interest.
Sir L. Heald: In this case, as my right hon. Friend said, it would be necessary for certain lines of policy to be laid down and certain definite directions to be given.
Another suggestion is that to make these actions absolute criminal offences would lead to simplicity and speed. So it would, if we adopted the "off-with-his head," Alice-in-Wonderland method, but I hope that it will not be suggested that we ought to do that. If we were to adopt that method the opportunities for litigation would be enormous. We cannot have better proof of that than that which is afforded by the experience of the United States, which the right hon. Gentleman the Member for Huyton seemed to take quite lightly. He said, "After all, the Sherman Act is not so bad."
Do many hon. Members appreciate what the Sherman Act has meant? It was passed in 1890, and said in effect, "Every crime which may lead to a restraint of trade is illegal, and anybody concerned with it is guilty of a criminal offence." As was pointed out by one Supreme Court judge, that included the circumstances of two business men going out to lunch together—because that might lead to a restraint of trade, and very probably would. So the courts in the United States said, "We cannot have our people being imperilled by that kind of broad danger, so we must introduce a qualification," and they introduced the beautifully vague words, "undue" and "unreasonable" in front of the word "restraint." That produced the most magnificent lawyers' jamboree in the whole of history.
I should like to give the House one example of what happened; there is not time to go into all the details. There are three decisions on the record in the United States relating to traders who were held to have committed offences against the Sherman Act. The first man sold his goods at a higher price than another. He was held to be guilty of profiteering and, therefore, guilty of an offence against the Sherman Act. The second sold his goods at a lower price than another. He was held to be guilty of unfair competition, and of offending against the same Section of the Act. The third man sold his goods at the same price, and he was held to be guilty of being a party to an agreement in restraint of trade.
1972
We must not create what somebody once described in relation to the Sherman Act, as,
"A lawyers' paradise and a traders' hell."
Surely it is much better not to make this a criminal offence, because if we do not we reap certain advantages. First, the matter does not have to be tried by a jury—and I believe that it would be most undesirable to have these matters tried by juries. Juries are human and it is easy to say to them, "Is it a very nice thing to call this man a criminal? He is only doing what everybody has been doing for years, and what all sorts of people are still doing, including trade unions. Are we to condemn him and call him a criminal?" That would not be a very desirable thing to do.
Then there is the question of public opinion. I believe that the public would feel that there was a certain amount of vindictive and, possibly, political feeling about the matter, and we might find that these cases would fail upon that ground. That would be a bad thing, because we want them to succeed where they ought to succeed. In addition, let us remember that the Labour Party's Monopolies Act of 1949, which was very carefully thought out, did not make use of criminal terms at all except in relation to the suppression of information and things of that kind, which are quite different. Everything needed here could be done by means of civil remedies.
I ask my right hon. and learned Friend to give his attention to one thing which does not seem to have been considered. For 70 years in this country we have had a code of legal practice in relation to the abuse of monopoly in relation to patents, which has been extremely successful. If it is shown that a man is abusing his patent rights he may even lose his patent or he may be ordered to grant a compulsory licence. I suggest to my right hon. and learned Friend that he should consider the possibility of applying those same considerations to trade marks and brand marks, because many of those practices are carried on by reference to such marks, and if the same provisions which now exist in the 1949 Patents Act were applied to trade marks and brand marks possibly many of the practices could be dealt with in that way. I hope, therefore, that this may be considered.

1973
Finally, there is the question of trade courts. It obviously would not be appropriate to discuss those in detail today because their future must depend upon the decision which is made on the broader issues; and it will only be possible to discuss them in detail when we come to see the form of the legislation that is brought in. Yet I feel entitled, and bound, to say this: that the minority of the Monopolies Commission, who seemed to think that trade courts are quite desirable, because of their eminent position in the world do not come into contact with the opinions of the ordinary man and woman in the same way that some of us have had the opportunity of doing in a recent period of three weeks, and I do not think they appreciate how strongly the general public feels about this matter.
I want to put dispassionately what has been put to me often by my constituents irrespective of party, because it is not a party question but one of people's feeling of fairness. The general public does not like the idea of people who are not members of an association being summoned before that association and "fined." The word "fined" I put in quotes, because those so-called courts have no legal right to fine anybody and they have no legal status of any kind, sort or description since no one can lawfully set up any court except the Crown. And the fine is not a fine in the ordinary sense but a payment of money under the threat of being put on a black list. It is the fact that in a case called Thorne v. The Motor Trade Association the House of Lords decided that the demand and receipt of money in return for not being put on a black list did not—repeat "not"—amount to "blackmail."
The associations are entitled to lay that flattering unction to their souls, but all that was decided by the House of Lords was that it was not blackmail. I believe that in the general opinion of the public these things, if they are to be done at all, ought to be done in the ordinary courts of the land.
In order to allow this to be done, as the right hon. Gentleman explained, the law would have to be altered so that, if the House came to the conclusion that price maintenance arrangements were justifiable in some cases, there could be a condition which is called a condition running with the goods, which would enable the price to be applied to the
1974
last seller. That is what is called the "non-signer," which is an American expression and means a man who is not in direct line but who eventually gets the goods and sells them to the public. If it were considered by Parliament desirable, it would be simple to have a legal provision which would allow the price, as it were, to follow the goods. I am not suggesting that it should be done but, if it were done, it could be done in the courts and I believe that it ought to be done in the courts or nowhere.
Two very eminent members of the minority who are good friends of mine and very great lawyers laid much stress on the great impartiality and judicial qualities of these so-called courts. I do not doubt that. It is a point which is emphasised by the associations themselves, but that is not the real point. The real point is the one which was put picturesquely and directly, as many things were put, by Dr. Johnson, when he was asked his opinion about women preachers. He said that it is like a dog walking on its hind legs; the surprising thing is not that it is done well but that it is done at all.
Mr. Godfrey Nicholson: I must correct my right hon. and learned Friend. What Dr. Johnson actually said was:
"It is not done well; but you are surprised to find it done at all."
Sir L. Heald: Whether it is done well or badly, I hope that the House, in coming to the conclusion that my right hon. Friend is taking the right course, will also join with me in asking him to make quite certain that, whatever else is included in this legislation, a provision is included by which these so-called courts cease to walk on their hind legs.
5.27 p.m.
Mr. John Cronin: To address this House effectively requires a degree of knowledge and experience which I do not claim to have attained, so I feel gratitude for the courteous usage of this House which accords indulgence to maiden speakers.
I have the honour to represent Loughborough, a constituency which is occupationally rather a mixed one and which is rather mixed in trade. We have a mining industry where there are fewer trade disputes and a higher production of coal per

1975
man per ton than anywhere else in the country; we also have an excellent agricultural industry, and we have important engineering and hosiery industries as well as numerous other minor industries.
There is one common factor in the constituency, and that is the popularity of the co-operative trading practice, which is of the first importance there. This form of trading suffers particularly from restrictive practices as known at present. There is no doubt that those people who wish to obtain their goods and commodities from Co-operative organisations suffer a heavy disadvantage in that they cannot receive dividends on those goods or else they have to do without them if the goods are the subject of restrictive practices. So in speaking today I feel that I am representing my constituency not only in that it is largely a Co-operative trading one, but also in that these practices affect most housewives and other people who shop.
The President of the Board of Trade rendered considerable service when he said that we should strip this question of all moral indignation and of all feelings of moral revulsion. It is important that we should analyse it coolly and appreciate that businessmen, so long as they are businessmen, have a duty to maximise their profits. So long as we accept private enterprise in this country, we must accept that principle. Therefore, we cannot regard it as morally wrong for them to accept restrictive practices to further their ends.
The important question is whether we are morally right in permitting those practices to continue if they are contrary to the interests of the country. Businessmen may have a straightforward self-interest. So far as production in industry is concerned, Oscar Wilde's dictum that self-love is the beginning of a lifelong romance is directly applicable, but we have to take into consideration whether we must break up that romance and interfere with it.
Another important point which the President of the Board of Trade mentioned was that this issue is complicated by the circumstances that there is no definite view at present as to the desirability of retail price maintenance, and this particular system of restrictive practices is only one way of maintaining
1976
retail price maintenance. I could not quite follow the right hon. Gentleman there, because surely it is quite a simple matter.
If we find on investigation that retail price maintenance is desirable, it is surely a simple matter to legislate to continue it? Across the Atlantic, in the United States, by the Miller-Tyding Act of 1931, they passed a law which legalised and strengthened retail price maintenance, so that it is a comparatively simple matter to deal with this question by legislation. It is quite unnecessary to proceed with it by a system of private law which goes on behind closed doors and of which the country has no knowledge at all.
It seems to me that the main argument against the Government's proposals, which are essentially those of the minority group on the Monopolies Commission, is first of all the slowness with which the procedure will take place. The President of the Board of Trade mentioned that things moved very slowly after the Labour Government had passed the Act of 1948, and I think that is the essence of the problem. If we examine each case on its merits, it will take a very long time, and I think it has been calculated that if we continue investigating monopoly conditions and restrictive practices at the same pace as we have done so far, it will take roughly 340 years to cover the whole of industry. It seems to me that that is carrying caution too far.
Another important aspect of the matter is that, under the Government's proposals, the industry will be quite unaware of what the position is. No individual industry and no individual producer or distributor will know whether it is likely that the practices with which it or he is associated will be condemned or not, and that will produce considerable uncertainty. Another important point is that the latecomers to be tried by the tribunals which the Government propose will be rather more fortunate people than those who will be tried straight away, because they will continue their practices, and this will create enormous injustice.
The right hon. and learned Member for Chertsey (Sir L. Heald), who has just spoken, has the advantage of being a lawyer, and I feel some diffidence in referring to his arguments. One of his

1977
principal objections to the recommendations of the majority group on the Commission was that they would create a new crime, and that we in this country are very reluctant to introduce new crimes into our law. Surely, that is an inevitable effect of a large part of modern legislation? If we are to control the life of this nation to the extent which is necessary in modern times, we have to produce new crimes.
One hundred years ago or so, it was eminently reasonable for somebody to enter this country with several gold watches and say nothing about it, but it is now considered, and reasonably and justly considered, to be a crime. If the public interest necessitates making what are apparently at present blameless practices into crimes, there is a very good precedent for doing so.
The right hon. and learned Gentleman also said that we would be deluged with applications—and that these applications basically will consist of applications to commit a crime. With all respect for the reasoning of the right hon. and learned Gentleman, I cannot follow it. Surely, the whole purpose of the majority Report recommendation that there should be applications is to decide whether the alleged offence was a crime or not; in other words, whether it was against the public interest or not. There is no question, in the face of the majority Report, of applications being made to commit a crime.
The right hon. and learned Gentleman also mentioned that the Sherman Act worked rather unsatisfactorily. The Sherman Act of 1890 was perhaps rather badly drafted, and that is probably the reason. It was the very first Act of its kind, but there is no reason why this House should not be able to draft a satisfactory Act. The Sherman Act, as amended by the Clayton Act of 1914, has worked very well in American industry, and there has been no question that since then restrictive practices have enormously decreased, and nobody can argue that it has adversely affected American industry.
America is now standing across the economic world like a colossus, and no country can make any important economic decision without deciding how it will be affected by the American
1978
economy. America, therefore, can hardly have been seriously affected by the Sherman Act, particularly as amended in 1914 by the Clayton Act.
A very important aspect of the matter is referred to on page 240 of the Commission's Report. It is made absolutely clear there that the Royal Commission did not find in any instance of all the multitudinous cases it investigated one restrictive practice which was in the public interest. It could not find that at all, and that was after a most careful investigation. Even the minority members of the Commission also appeared to be quite unable to put their fingers on any definite case in which it was in the public interest to maintain a restrictive practice.
It seems to me that there is a very strong case for applying really drastic action in completely prohibiting restrictive practices as defined in the Commission's Report. This decision is particularly important just now as we are facing more and more competition from other countries. We have been largely beaten by American competition in many commodities throughout the markets of the world, and we now find a rising competitor in Germany, which is producing very substantial competition for us. It is most important, therefore, that we should train ourselves down and strip ourselves like athletes, so as to get our economy into the best possible form to meet this real, dire competition that will threaten the standard of living of everyone in this country.
In conclusion, there is one point which is not referred to in the Report of the Monopolies Commission, and it is a question about a restrictive practice that might reasonably have been included. It is this question of collusive tendering. Though it was outside the terms of reference of the Commission, it is clearly a restrictive practice and one that is having a widespread effect throughout the country. Until a short time ago, I myself was a member of the London County Council, and a member of the Supplies and Finance Committees, and I was constantly struck by this unsatisfactory aspect of tendering as we met it there. We so frequently met suggestions that the tendering was not strictly fair and was not competitive.

1979
The President of the Board of Trade only recently received a deputation from the Association of Municipal Corporations which produced incontrovertible evidence that there was a very unsatisfactory position arising through what appears to be collusive tendering. I think that is a matter which the right hon. Gentleman would do well to consider in conjunction with the vexed question of restrictive practices.
The whole country will await the results of this Royal Commission's Report, because it is something of really fundamental importance to our economy and to our lives in the future, and I think that the President of the Board of Trade must come to a firm conclusion on what the Government must do. Are they going to offer what is largely a palliative, or tackle this by a well-planned but carefully-performed major operation? I think that the latter course is necessary. The whole country will wait to see whether the housewives are to have relief in their shopping and the people on fixed incomes and the old-age pensioners are to have lower prices. Industry, too, will wait before making its plans for the future. The whole country is waiting, and I hope that the right hon. Gentleman will meet the challenge.
5.40 p.m.
Lieut.-Colonel Wentworth Schofield: It is with very great pleasure indeed that I follow the hon. Member for Loughborough (Mr. Cronin). I am rather pleased to hear that he considers that the greatest or the chief business interest in his constituency is the Cooperative movement. As I happen to represent a constituency which was the home of that movement, I think it rather fitting that I should have the opportunity of congratulating him on what I consider to be a quite memorable maiden speech. He delivered it with confidence and without reference to notes, and has shown a complete grasp of the subject now under discussion. I can assure him that we shall all wait with pleasure and eagerness to hear further contributions from him to our debates.
I myself have taken part in the organisation and administration of minimum price agreements in the cotton spinning industry. Although the particular type of agreement is in the category of collective agreements on common prices and, as
1980
such, was not included in the Commission's terms of reference, I feel I should acquaint the House of my association. I think, also, that the House should know something about how these agreements originally came into being. When considering the majority Report, my mind was carried back about twenty-five years to the early 'thirties, when unemployment was rife and when many of these agreements which are now condemned were evolved.
At that time there was a general lack of trade, and in a mad scramble for such trade as was available price cutting was rampant in many industries. For instance, in the cotton spinning industry—of which I feel that I can claim a fairly extensive knowledge—the situation became so bad that cotton yarns and cloth were being sold at prices far below the cost of production of even the most efficient firms. Price cutting was carried to such an extent that such items of cost as depreciation and interest on capital were completely ignored. The need for providing for replacement of machinery and plant was no longer taken into account in the computation of selling prices. In the struggle to keep their mills running, manufacturers and spinners deliberately sacrificed the future of those mills to the needs of the present.
So intense was the price war at that time that firms found themselves actually giving away their capital with every pound of yarn or yard of cloth which they sold; as prices were forced lower, cloths became debased and the survival of the firms depended not so much on their own efficiency as upon the length of their purse. When, finally, they came to the end of their resources, as so many did, mill after mill was forced to close—many never to start again. I do not need to remind hon. Members that, as the mills closed, the queues of the unemployed grew longer and longer.
I do not know the precise definition of the words "public interest," but I would hardly think that the conditions which I have just described could be held to be in the public interest. Under such conditions it is not only the employer who suffers. The workpeople become unemployed. That means that they have no money to spend and the shopkeepers are also affected—and so is the general economy of the country. When it is finally decided what sort of tribunal is to

1981
be set up, I hope that great care will be taken in correctly defining what is known as "public interest."
It was against the background of those conditions that those who survived started to look to other methods for the marketing of their products. There is no doubt at all that it was the bitter experience of those days which caused this one-time fiercely individualistic cotton spinning industry to change its methods, and to become almost a pioneer in the art of collective selling. Indeed, so serious was the position that a combined approach was made by representatives of all sections of the cotton industry asking for Government sanction for price-fixing schemes. Those present who were hon. Members of this House in 1939 will remember that, on 4th August, 1939, Parliament passed the Cotton Industry (Reorganisation) Act. That gave power to the industry to implement schemes—one of which related to redundancy—as and when they were required. Another scheme was for the implementation of minimum prices.
That Act laid down that the schemes would come into operation three months after the passing of the Measure, but because of the outbreak of war the Act was postponed for use when peace returned. It was left to the President of the Board of Trade to determine on what date it should come into operation, but in 1947 the Act was repealed—I do not know why. From the Second Reading debate on the original Bill, it is rather singular to notice that its strongest support came from hon. Members on the other side of the House; and perhaps those who spoke mostly against it were hon. Members on this side.
The Bill received its Second Reading without a Division. In those days, there was no question of appealing to a tribunal for the cotton industry. The industry appealed to this House, which heard the case and sanctioned the carrying out of the scheme. I mention this merely to show that the feelings of hon. Members were not always as they are today, particularly on this thorny subject of price agreements. Circumstances certainly change the opinions of many people.
Nor must it be thought that it is only the employers who were in favour of these price-fixing schemes. I have here a report issued by the Amalgamated Association of Operative Cotton Spinners,
1982
one of the most important trade unions in the cotton spinning industry, in which they give their opinion on this subject of minimum price schemes which are operating in the cotton spinning industry at present. I shall not take up the time of the House by reading the report, but I have paraphrased it, and it amounts to this. They refer, as I have done, to the intensive price cutting and to the closing down of firms.
They also point out that at that time not only were dividends practically eliminated but the wages of the operatives were very severely reduced and the trade union funds were wholly used up in the provision of unemployment benefit for their members. The report concludes by saying that the experience must never again be repeated in the spinning industry, and because of that they feel that the scheme at present operating in the spinning industry should not be interfered with.
Mr. John Edwards: Would the hon. and gallant Gentleman tell the House the date of that report?
Lieut.-Colonel Schofield: The date was 1954.
During the whole of the time that the Monopolies Commission has been in existence the country has been enjoying unrivalled prosperity and full employment, but many of the agreements which came into being did so in a time of slump. In the cotton industry, for instance, those agreements were born of adversity. They were in the nature not of profit-making instruments but lifebelts to prevent firms from sinking to destruction.
When reading the Report of the Commission, I could not help wondering what sort of report might have been made by the Commission had it been called upon to report in those days and in those conditions. I wonder whether, in face of those conditions, the Commission would have made such sweeping recommendations as it now makes for the general prohibition of these agreements.
5.53 p.m.
Mr. Harold Lever: I suppose it is axiomatic that when merchants, manufacturers or traders band together in an association to fix the terms of their trade, whether it

1983
be prices or means of distribution and the like, they fall short in objectivity in deciding what is most in their interest and what is most in the community interest, and I suppose it must follow that where these restrictive practices, cartels and monopolies exist there are many instances where the public is the victim of gross overcharging.
This having been said, I want to say, without mincing my words, that I cannot join in the nostalgic hallelujahs which one hears from all quarters of the House at the idea of a return to unbridled competitive capitalism in trade. I go further and say that I am astounded to hear from both sides of the House perfectly normal and desirable trade practices being condemned as criminal in themselves, as opposed to the criminal abuse of them, as, indeed, there can be criminal abuse of any form of human behaviour.
I want to try to bring the House back to a sense of reason. These practices are not criminal, and the idea of the majority of the Commission in recommending that these should be made sweeping criminal offences has already been partly dealt with by the former Attorney-General, the right hon. and learned Member for Chertsey (Sir L. Heald). There is nothing primarily immoral, still less criminal, in members engaged in a trade seeking to fix the price at which their products shall be sold, provided that the price fixed is fair and does not abuse the public interest. How hon. Members can take the contrary view I do not know.
That is precisely what has been happening in our major industry today, agriculture, with the blessing of the House and a good deal of supporting legislation, not to mention a good deal of finance provided by Chancellors of the Exchequer of both parties. I should like to know therefore, whether, in turning this sort of practice into a criminal offence, the majority of the Commission would whip off to gaol all the Chancellors of the Exchequer who have been in office since I have been in this House, which is ten years at intervals. I have noticed Chancellors of the Exchequer of both parties financing the restrictive practices which we are urged by the majority of the Royal Commission to regard as criminal offences.
1984
While we are at it, I take it that we are going to lock up all the directors of British European Airways and British Overseas Airways because they have committed the atrocity, in common with every leading airway in the world, of signing the most complicated arrangements for the fixing of fares, terms of agency, terms of ticket issues, terms on which parties should be carried, terms of reduction and the like, with expulsion from the organisation of those who will not honour these arrangements. Why we should assume that these practices are of their nature evil, still more criminal, I know not.
It is perfectly obvious that nothing like decency in modern commercial life is possible, whatever view one takes, without a network of these arrangements. Not only must we refrain from putting them out of existence but we must recognise that the only sensible course is to preserve and encourage them on the one hand, while making quite sure, on the other hand, that they are not used to exploit the public.
Our economic thinkers, as always backing the wrong horse and out of touch with reality, are almost unanimous in their desire to bring this restrictionism, as they call it, to an end. They want us to return to the glories of a nineteenth century Liberal dogfight as if the world were not peopled with monuments to the results of the unbridled practice of free competition.
My views are not contradicted by hearing from my right hon. Friend the Member for Huyton (Mr. H. Wilson) the sad tale of the tea trader who was anxious to supply without profit all the needy old-age pensioners in his area with tea. All I can say is that I should like to know what many of my trade union friends in the House would say if some of their colleagues offered to do work for firms, for moral or other reasons, at half the wages ruling.
Mr. A. E. Hunter: No trade union would object to helping an old-age pensioner.
Mr. Lever: I am not suggesting that it would, but, obviously, it is wrong to argue that because a trading association refuses to allow one of its members to work for nothing, and thereby tend to undermine the business of his colleagues, it is doing

1985
something evil and criminal which should be spurned and condemned by all forward-looking members of the Labour Party. I have been a member of that party since I was a boy, and I am afraid that I cannot share the enthusiasm for supporting practices of that character; and neither, I think, would most working men.
The same applies to the tyre trader who wanted to bring down the cost of living by selling at cut prices tyres which he had contracted to sell at a fixed price. There was no other motive but to increase his profit at the expense of his colleagues in the trade. He may or may not, according to the facts, be undermining the possibility of his colleagues to earn a normal living by normal work.
It is up to the Government and to the Opposition to find a means of controlling monopolies and trade practices instead of condemning them in this stupid general way, because they are the inevitable accompaniments of any civilised form of commercial life. We have to ensure that they are not unfair to the public and that there is no abuse contrary to the public interest. No one has offered anything very constructive from that point of view.
It is unthinkable that we should create a criminal offence as suggested by the Royal Commission. This is one of the very grave difficulties in dealing with the matter. If one takes the view, as some of my hon. Friends do, that one must stop dealing piecemeal with the problem and, instead, apply a sweeping scimitar and create a criminal offence, it will affect most respectable persons who have been enjoying Government financial support for their practices for ten years or longer. It will undermine the basis of stability by which much has been achieved for industry and for workers.
Above all, one would pose an insoluble problem for the unfortunate judge who had to try the case. One cannot make restrictive practices a criminal offence without giving the accused the defence that what he was doing was not contrary to the public interest. It follows that judges in the High Court or tribunal presidents would have to determine whether or not a man should go to gaol on the basis of whether what he had done was or was not in the public interest.
1986
If I were the chairman of a tribunal I might have one view of what constituted public interest. My right hon. Friend might take a different view. What is certainly not in the public interest is that people's lives, liberties and personal reputations should be at the mercy of such a clash of divergent opinions on what is, after all, a matter of opinion and not a matter of established fact. It is out of the question for us to create a criminal offence of that kind.
It is equally begging the question for the Minister to come here and pile up a small mound of platitudes, lash himself into a meaningless peroration and then tell us that he has solved the problem, which is one of the greatest problems of modern economic life. That is not tackling the problem; it is running away from it. If the right hon. Gentleman seeks to comfort himself by the follies or lack of thought in the argument of those attacking the Government, he is not doing justice to the office which he holds.
It is for the Government to work out a means, unless they are to betray their Election pledges and betray the people to ruthless exploitation and abuse by monopolies. Instead of our having the collection of impracticalities promised in the speech of the right hon. Gentleman, the Government should bring in serious legislation. It is inconceivable that the country will be satisfied with what is, plainly, a blatant evasion of the problem. It is clear that the country will demand an account of the stewardship of the President of the Board of Trade in this very important matter.
I want to make one or two observations in order to elaborate the theme that reality is always a little more complex than the theories of economists. It is not always the case that price fixing results in extortionate charges to the community. Very often the contrary is the case. I dare say that in most cases a short-term greedy view is taken by associations, but I do not know. Nevertheless, I am aware of many specific cases where things have worked the other way.
For years after the war the motor trade association was pursuing a typically English commercial activity in hunting people down for paying too much for its products. It did its best to keep down the price of motor cars. The same thing

1987
was done by the virtual monopolists of one of the most precious of this world's liquids, Scotch whisky——
Mr. Paget: Much to the indignation of the hon. Member for Aberdeenshire, East (Sir R. Boothby).
Mr. Lever: We also have Mr. Prain, probably the biggest semi-monopolist in the Rhodesian mines, who controls half the Rhodesian copper production, selling copper to manufacturers in this country at about £60 per ton below the London market price. He is a sort of Canute of the copper kings of Rhodesia. He is selling at £280 per ton when the world market price is about £350 per ton, which is a laudable effort. Therefore, monopoly does not always work in the one way.
Speaking from my experience in the constituencies, I am constantly tortured by the simplicity and child-like behaviour of many working people in relation to their commercial dealing. These people may be hard-working and very good at their own job, but they are very often like babes in arms in the hands of slick traders when it comes to buying household goods and the like. [HON. MEMBERS: "Slick lawyers, too."] They very often have to go to slick lawyers to help them out.
From my experience with my constituents in trying to undo some of the swindling, fraud and sharp practice from which they have suffered, I am convinced that the sharp practice that takes place is usually not in respect of price-controlled goods but dud carpets, dud textiles and the like. We are very sophisticated and doubtless know whether a shirt is a good value at 30s. or 50s. Many people do not; they are not in a position to judge the value of carpets and shirts.
Having branded goods, price-fixing and price-maintenance arrangements very often works to the advantage of the ignorant, for they then know what they are getting and they often know that they are, at any rate, getting some sort of value for their money. This does not mean that the people are not being overcharged, but these things do not always work one way.
We appear to be up against quite insuperable difficulties in operating either the scheme propounded by the Govern-
1988
ment or the criminal proceedings propounded by the Opposition and the Royal Commission. I should like to offer, very tentatively, what I consider to be the general principles of a remedy.
The first thing is that most of the problems can be tackled by sharpening our fiscal weapon so that excessive profits can be dealt with. It is not an easy matter to work it out. The second thing is that we should clear from our minds the kind of nonsense that we have heard. I gathered from the admirable maiden speech of my hon. Friend the Member for Loughborough (Mr. Cronin) that at some point in the Report of the Royal Commission, or a Report by another Royal Commission, it was said that there is not one restrictive practice which has proved to be in the public interest. That is patent balderdash. Any body of men surveying modern industry in this or any other country who can propound such unadulterated nonsense disqualify themselves at once from being counsellors in the matter.
The House should look at this matter again very carefully. As a Socialist, I believe that the remedy for overcharging and abuse of monopoly practice or price-fixing arrangements will very often lie in the direction of public ownership.
Miss Jennie Lee: Hear, hear.
Hon. Members: No.
Mr. Lever: It appears that I have wasted a great deal of the time of the House because hon. Members opposite have not appreciated the purport of my remarks, which is that monopoly practices are often perfectly all right, necessary, desirable, civilised and modern, provided that they are used not for the exploitation of the public but for preserving decent working and trading conditions. That is what we must ensure.
It has not by any means been proved that unbridled competition accompanied by the bankruptcy of marginal producers and the paraphernalia of thumbscrew Liberalism is even economically advantageous, except, perhaps, to the satisfaction of the economists who, as I have said, are almost always wrong. Every time there is unbridled competition we get the kind of thing quoted by the hon. and gallant Member for Rochdale (Lieut.-Colonel Schofield), who spoke about the fine spinners.

1989
Very often at times of crisis people take the short view, and the weaker man has to sell out, often at destructively low prices which undermine the stability and basis of the trade. That sort of thing has to be guarded against. For all I know, the fine spinners' agreement may be a fraud on the public. I do not know, but I know that there is every justification for a fine spinners' agreement. Whether the present prices fixed are right or not I am not in a position to say, but the Government could find out. I am all in favour of a fine spinners' agreement to prevent the trade being wrecked.
When people cite the progress of America I remain coldly unimpressed. I want more goods and material things to enlarge human happiness and not to make people the slaves of an anxiety-ridden system where everyone lives under a ruthless competition with no sort of protection for anyone and where the human decencies do not apply. I am prepared to have a dish of herbs where there is peace rather than a fatted calf where strife prevails and no man knows whether his job is safe.
Subject always to the necessary steps being taken, instead of the bluff and platitudes to which we have been treated I am in favour of restrictive practices. I am in favour in most cases of monopoly practices. I am in favour of decency, order and accommodation rather than a return to the law of the jungle, which has done so much to disfigure our lives and our country in the past and is likely to do so again if we go back to that law.
6.12 p.m.
Captain Charles Waterhouse: The hon. Member for Cheetham (Mr. H. Lever), who addressed the House so admirably, in his last few sentences made clear his attitude, which was not very clear before. He referred to the proposals of my right hon. Friend as being "a collection of imbecilities," to the Report as being "patent balderdash and unadulterated nonsense" and other parts of the suggestions as being connected with "a thumbscrew Liberalism," but, generally, I believe that when he considers what my right hon. Friend said this afternoon he will find that those suggestions are not very far away from those suggested by the hon. Member for Cheetham, just as I believe that my hon.
1990
and gallant Friend the Member for Rochdale (Lieut.-Colonel Schofield) will approve of those suggestions, also.
This is an extremely difficult subject. It seems to me that my right hon. Friend has to try to get all the skill of a surgeon. He has to cut out the bad, cankered parts and preserve as far as he can the health of the patient. The bother is that this is an operation in which he can administer no anaesthetic. Worse still, the operation has to be done in public.
My hon. and gallant Friend the Member for Rochdale gave a short account of the history of these proposals. I would remind the House that within the memory of many of us in this House these very practices were commended from these benches and re-commended from the Opposition benches under the pleasant name of "rationalisation." Rationalisation schemes during the 1930s were extremely popular. I believe that the benefits which certain industries got under the Safeguarding of Industries Act were made to hinge on whether or not they had rationalised their industry. So we ought not to be too sweeping in our condemnation but look at each of the industries concerned with very great care.
Let hon. Members opposite remember that although some of these proposals have undoubtedly increased prices, and profits, others have definitely held prices, have even decreased them. They should remember especially that all these proposals, I think without exception, are as much to the benefit of the workers in the trades as to the shareholders and owners of the industry. In times of acute depression schemes of this sort are apt to fail and in times of great prosperity they are not needed, but in normal times, when trade is on a fairly level keel, there is great value in many of these trade agreements.
I would also remind the House that, in spite of the fact that this Commission sat for two years and invited representations to be made to it from all sources, it had only 90 representations from any sources, from industries, from persons, from those who generalised and those who took a political view. Only 90 people took the trouble to send in complaints, if we put it that way.
Mr. Percy Daines: Is the right hon. and gallant Gentleman

1991
satisfied that there are not many businesses and concerns which were afraid to come forward? I can assure him that in the Co-operative movement we had the greatest difficulty in getting some societies to come forward and give evidence for fear of having their supplies withheld.
Captain Waterhouse: Some Co-operative societies?
Mr. Daines: Yes.
Captain Waterhouse: If the hon. Member means that Co-operative societies were afraid to come forward I should be extremely surprised. One of the greatest industrial movements in the country, one of its greatest retail organisations, afraid to come forward because it will be blacklisted by a manufacturer? I should be very surprised indeed.
Mr. Daines: It happens to be true.
Captain Waterhouse: I should have thought they would welcome it as an additional reason for expanding their wholesale trade in that direction. I am perfectly certain that that is not the reason why there were so few complaints to the Commission. The reason was that, generally, the trading community as a whole does not find these restrictions nearly as injurious as one is apt to think.
I wish to commend what my right hon. Friend the President of the Board of Trade said about registration. I am sure that he is absolutely right about getting a general registration. There is no secrecy about these agreements and there should be no difficulty about getting them registered. An agreement is best negotiated in private. When it is established let it be published and I am sure that nothing but good could come out of publication.
There seem to be three main points for decision. The first was dealt with by my right hon. Friend to a certain degree and I do not altogether agree with his conclusions. It is that we must decide who is to be allowed to object. At present, the objection must come from the Board of Trade. My right hon. Friend suggested a tribunal which would object, and apparently judge at the same time. That I do not like.
1992
I should leave the power of objection with the Board of Trade, but I should widen it. I should let any trader come in and object. I should let any consumer come in and object. Anybody with a definite interest I should allow to come in and object, but I certainly should not allow objections open to any theorist who merely thought that rings were a bad thing and, therefore, he was objecting on what is called principle. Principles are the basis of our political life, but this is the application of a principle and we must assure ourselves that the objections made to these practices are practical suggestions.
The second point is that we have to decide the grounds for objection. My right hon. Friend made certain suggestions. I do not think it is impossible to get a set of rules on which we could work. I am told that for 150 years or so, before the Commission was thought about, the courts used to decide these cases and there is quite a body of case law which could be reviewed and perhaps utilised. Section 14 of the Act lays down certain definite rules and my right hon. Friend has, at the Board of Trade, many active young men who could think up plenty of rules. He may have, I hope, a certain number of wiser, older, civil servants, who could go through those suggestions with a red pencil and scratch most of them out. Finally, the abbreviated list should come to my right hon. Friend, and I believe that, in consultation with his Ministerial colleagues, it would be possible to get a code of rules which would operate usefully and smoothly.
The third point is, who is to judge? My right hon. and learned Friend the Member for Chertsey (Sir L. Heald), the former Attorney-General, has spoken on that subject and I entirely agree with him. I am in dread of setting up another tribunal. In no way am I disparaging those ladies and gentlemen who work on these public bodies, but it is quite impossible to get anybody who does not have a bias. If people are politicians, they most certainly have a bias. It may be a very healthy bias, I agree. If they are traders or are in commerce, they are sure to be biassed. If they are trade unionists they will have another bias, and if they are economists they will have the biggest bias of all. If one goes into the outside world to get people, one is almost bound with them to get a bias.

1993
There is, however, one section of the community which is regarded in its functions as being above bias and above complaint. I am referring to the judiciary. I am quite sure that it would be possible to get a panel of learned judges who could and would specialise in this matter, just as judges specialise in other matters, who would deal with each case as it came up on the rules and who would themselves form a body of case law as time passed, possibly expanding and possibly contracting in some directions in which they would use their discretion.
Those are the main points I wanted to raise on this issue today, but my last point I believe to be the most important and I shall refer to it briefly. I believe that this set of restrictive practices, important as they are, are comparatively small in importance compared to the much wider restrictive practices on what has been called "the other side of industry." The examination of those was expressly excluded from the Report. There has been built up by the trade union movement, properly at the time they were built up, a whole mass of rules and regulations to protect the worker against the employer. They were absolutely right at the time they were initiated. Today, I believe, many of them have outgrown their usefulness, and I hope that the time will come when, if possible in consultation with the great trade unions, my right hon. Friend will be bold enough to examine this other side. Then, and then only, can we hope that British trade may be free from the most objectionable practices which now exist.
6.25 p.m.
Mr. R. T. Paget: I find some difficulty in accepting either the majority or the minority Report of the Monopolies Commission, because it seems to me that both of these Reports are based upon two primary fallacies. The first of these fallacies is the assumption that prices today are generally fixed by competition. They are not. The second assumption, which seems to me to be even worse, is that it would be a good thing if prices were fixed by competition.
Over the great field of our prices, starting with agriculture, fuel and steel, and moving into the realms of engineering and of all our great industries, prices are fixed not by competition. They are not fixed
1994
by the buyers. They are fixed by the sellers, and they are fixed either by large monopolies who have gained sufficient control in their fields to become price leaders or by trade associations, fixed upon the basis of what is deemed to be a fair price. Whether the right people decide what is a fair price is another matter, as to which I shall speak presently, but that idea of the fair price is the basis of pricing in the overwhelming field of our economy today.
The idea that that is not the right thing to do is an idea of morality which occurred only in the nineteenth century. Up till then, every church regarded price fixing by competition as a sin. The idea that prices should be fixed by driving the marginal producer into bankruptcy was an idea which every church, up to the nineteenth century at any rate, regarded as fundamentally contrary to a Christian's views. I believe that they were right in so thinking. I believe that the medieval conception of the fair price which has come back again into the whole field of our economy was the right one and the moral one.
Having said that, I would add one other thing. Stalin in his "Political Testament" started with these words:
"It is the nature of capitalism and the condition of its existence that the capitalist should not merely seek profit, but the maximum possible profit."
Then he proceeded to argue, with impeccable logic, that it was unnecessary for the Soviet Union to take action because the working of that system would inevitably break itself to pieces within a few years. If his original premise were right, I entirely agree with his argument. The reason I believe that we shall prove Stalin to be wrong is quite simple; that we have got away from the price competition as the means of fixing our prices and have achieved a system which gives us a vastly greater stability.
It was said that the last Election was rather dull because there was no great conflict between the parties. That was deplored, I think, by a great many people on both sides of the House. I do not deplore it. It would be difficult to define a good community better than saying it is one which has two parties which will provide alternative Government and which are broadly in agreement on the general lines on which a country ought to be

1995
governed. That is something which, very largely, we have achieved here in England.
I should say that that is true for this reason, that in the Tory Party and in the Socialist Party we have two parties which fundamentally believe in a peaceful and an ordered society. It is a different ordering in which we believe. We on this side believe in an egalitarian society, they, on that side, in a less egalitarian society; but, none the less, a society which is ordered——
Mr. Ellis Smith: Let them join the Labour Party.
Mr. Paget: —a society which has security and a sense of responsibility. [Laughter.] It is all very well for hon. Members to laugh at these things, but let them consider the things we have stood for and worked for and which, in five years of Government after the war, we created.
That is the society in which we are living. It is a society which attempts to achieve within our social and industrial organisation the most complicated, the most unnatural and the most difficult of human relationships: peace. I believe that we have achieved a larger measure of peace within our society here in England, political peace, industrial peace, than any society has ever enjoyed before. That has been the work of the two great parties in this country since the war.
As against that, the Liberal conception is the conception of war in the economy. How can we have an ordered society, which the two great parties desire, if we throw our production open to a price competition which consists of bankrupting the marginal producers and forcing them out of production? A society which does that cannot be a peaceful society. I feel that it is the influence of the infiltrators from Liberalism within both our parties who have too much to say on these occasions.
I believe that our British system is a good system. I think that we have achieved a far better society than any community has yet achieved in our human history. Consider the Americans. They have certainly achieved a higher production, but, as my hon. Friend the
1996
Member for Cheetham (Mr. H. Lever) put it, at the cost of—I believe it is statistically true—of causing one stomach ulcer in three among the male population in the northern States. We proceed to move more leisurely. We look at the Americans and say, "Children run, but adults have the sense to walk." I do not want this feverish activity, which this new competition may induce us to adopt. The Tory Government hand out to us as an objective a calculation that we may double our productivity in twenty-five years. As far as I am concerned, I do not mind if it takes fifty, but I certainly do not want that increase of productivity to be made at the cost of Americanising our society.
These practices have grown. They have grown as our industries have developed. On the whole, I am in favour of the things that have grown within our society. They have grown because the people in those industries found that they were for their mutual comfort and good, and enabled them to live at peace with one another. I do not want to upset them indiscriminately. We need to look at these things carefully, and to look at them not from the point of view of putting the clock back, and least of all from the point of view of upsetting that level of peace which we have achieved, and which is so precious, and of casting us back into the conditions of the nineteenth century.
Prices ought to be watched and controlled in the national interest, but the suggestion which the President of the Board of Trade has made of a court or tribunal is a piece of sheer hypocrisy. There is no justiciable issue here. How will a tribunal decide what the public interest is? That is the very job of the Government to do themselves. All retail prices fixed by the manufacturer, whether by agreement or not, whether under a trade mark or not, should be submitted to the Board of Trade with a cost certificate of the cost of production of the goods. Let nobody mark goods with a retail price unless he has had that price thus scrutinised.
The price-cost certificate is in existence. It is necessary to enable the producer to make his price. It should go to the Board of Trade, and the Board of Trade ought to consider it, to see whether the price is reasonable, whether, for instance, it contains too much for advertising and should

1997
have power to control the price if it is not. The Board of Trade ought to have the power, on considering a cost certificate, to make further investigation into the costs if necessary, and power to exercise control, if we are to work not on a competitive price but on a price which is settled, not by the buyer, but by the seller—which is how most prices are fixed today. The public has an interest in that price, and that interest must be guarded. That is what we have a Government for.
Mr. Osborne: Does the hon. and learned Gentleman really think that there are or could be at the Board of Trade men better qualified to look through production costs than the men in the industries themselves? Does he think that the Board of Trade could do the job better than the men in industry themselves? If he does, he really does not know much about industry.
Mr. Paget: I am not saying that they could do better, but that they could do it in a different interest. A manufacturer prices his goods in his own interest, and since he maintains that price the public has an interest in the costings. The Board of Trade is quite capable of considering in the public interest the cost certificate which the manufacturer will have brought out, and of seeing how it is made up. and whether the price is fair to the public. That is the way it ought to be done.
6.38 p.m.
Squadron Leader A. E. Cooper: The hon. and learned Gentleman the Member for Northampton (Mr. Paget), I believe, practises at the Bar—I hope, successfully—but it is quite obvious that his ignorance of industry is abysmal. The proposal which he has just made is nothing more or less than the old cost-plus. Anybody who has had any experience of working with a Government Department on a cost-plus basis knows the inefficiencies of that system. I hope that we have long since passed the day when we need to return to that sort of system.
Mr. Paget: It has nothing whatever to do with cost-plus. These are not prices which are offered to the Government. Anybody who offers goods for sale has the costings, and we simply suggest that the Board of Trade should be allowed to see the costings.
Squadron Leader Cooper: I understood that, but, obviously, if the cost is to be submitted to the Board of Trade then the selling price also must be submitted, and it will then be for the Board of Trade to determine the difference between the selling price and the cost. In other words, the Board of Trade will determine what the profit is to be, and I believe that that is cost-plus.
The debate has become very interesting. We have on the Order Paper an official Opposition Amendment calling upon the Government to take certain action. If I may say so, the speech which made most sense today was that of the hon. Member for Cheetham (Mr. H. Lever).
Mr. L. M. Lever: Hear, hear.
Squadron Leader Cooper: We shall all be interested to see how the hon. Member for Cheetham votes tonight. I would suppose that after the speech he has made he will either abstain on the official Opposition Amendment or come into the Lobby with us.
Mr. H. Lever: The hon. and gallant Member has been kind and courteous enough to say that my speech made good sense, but as he attacks the Opposition Amendment and the Government Motion I shall also be interested to see how he votes.
Squadron Leader Cooper: Perhaps the hon. Member will do me the courtesy of listening to me until I end my speech. He might then have some idea of what I propose to do.
I would hope that the kind of approach which the hon. Member made to this problem of restrictive practices would be the approach which the House as a whole could make, for it really is beyond the realm of party politics. First, we have to consider the type of monopolies which exist in the country—and they do not all exist on one side of industry. There are certainly very many monopolies on the manufacturing side. I wonder whether my right hon. Friend the President of the Board of Trade has any idea how many registrations are likely to flow into the Board of Trade once legislation to deal with this matter is passed. I would hazard a guess that there would be certainly more than 10,000. If the President is prepared to assure the House that

1999
more than 10,000 agreements—and I put that as a very conservative estimate—can be dealt with quickly by a tribunal I hope that I shall live to see it done.
Mr. Ian Mikardo: Will the hon. and gallant Member give way?
Squadron Leader Cooper: In a moment.
I should like us to be a little clearer on what constitutes a monopoly. I have heard hon. Members opposite refer to I.C.I. as a monopoly. It has become almost a fetish with hon. Members opposite to speak in the House and on the public platform about I.C.I. as if it were something vicious. The monopoly which I.C.I. has in the chemical industry exists only in a number of products. It exists in products which are generally sold in such large quantities and at such a low price that it would not pay anybody else to enter into competition with the I.C.I. This is certainly the case with such things as caustic soda and chlorine. There is no monopoly in the sense that nobody else can produce these things.
Mr. Robert Edwards: What about nylon and Terylene?
Squadron Leader Cooper: It is true that I.C.I. has almost a monopoly interest in Terylene, but it certainly has not in nylon.
Mr. Edwards: I.C.I. controls patent rights.
Squadron Leader Cooper: Yes, for a certain number of years, but nobody would suggest that those patents which I.C.I. has properly acquired, very largely as a result of its own research, are something wrong in themselves. In fact, the research which I.C.I. has done over many years has added enormously to our economic strength. Instead of criticising I.C.I., hon. Members opposite should be very proud that this great company operates in this country.
I want to get this question of what is a monopoly into correct perspective. There are various types of monopoly, some good and some bad. As to the trade union side, we must not forget that if it is right for a man to unite with other men to determine the price at which his labour should be sold, it cannot be wrong for a manufacturer of a product to determine
2000
the price at which that product should be sold. But we have to control both these things; otherwise, both get out of hand and the economy of the nation suffers in consequence.
My objections to some of these trade practices are very precise. If I may say so, I speak with a little authority, because for some years I was associated with a company which was itself a member of a trade association which fixed prices. Then the company with which I am now associated decided that it would have nothing whatever to do with this price ring, with very considerable effects on the price of the product in the country. I believe that a price ring, that is to say, a collection of firms which join together to fix the price at which they should sell to the manufacturer, is wrong and is contrary to the national interest. I believe it to be wrong because selling prices in the main are fixed on the costs of the least efficient producer in the group, and that cannot be right in the national interest.
Mr. Charles A. Howell: So we shall see the hon. and gallant Member in our Lobby after all.
Squadron Leader Cooper: I wish the hon. Member would try not to be facetious. This happens to be a very serious debate affecting the life of the country. I hope that the hon. Member will have something constructive to say before the debate is over. We shall be interested to hear it.
I believe individual resale price maintenance to be in the best interest of the country. I believe that the National Union of Shop, Distributive and Allied Workers approve of it. It creates a situation of stability for shopkeepers and assistants and permits a decent standard of living for them, but I believe that collective resale price maintenance is wrong. I think that if one has a body of firms which together determine the price at which a product shall be sold and that if the buyer breaks the rules laid down by the association he is put on a stop list and virtually has his livelihood taken from him, that is morally wrong. That is why I profoundly oppose the practices of the British Motor Trade Association and like bodies. The existence of what had been called "Star Chamber" courts and similar bodies are wholly repugnant to the people of this country.

2001
Paragraph 268 of the minority Report states:
"Much of the public uneasiness on this matter arises from a feeling that the recalcitrant trader is made the subject of some sinister 'Star Chamber' procedure. We do not think that uneasiness on this score is well-founded. The 'Star Chamber' notion arises from the existence of informal tribunals where the trader is given a hearing before any decision to apply sanctions to him is taken. Where such tribunals exist, the evidence goes to show that considerable trouble is taken to ensure that their procedure is fair and in conformity with the law."
I submit, with all respect, that that begs the whole question. It is not a question whether the proceedings at the courts are fair, but whether it is right or just that the courts should exist at all. That is where, quite frankly, I join issue with a number of my hon. Friends.
Somehow—and I do not profess at this stage to be able to offer any clear solution to the House—we have to create a system of orderly marketing for our goods in this country. But we have to create such a system in order to secure stability in our economic life and to secure the wages and salaries of our people. But in creating that system we do not need to create a Frankenstein monopoly which, in the end, will crush our economic life rather than develop it.
It has been said this afternoon that many of these practices in industry developed between the wars, when there was great unemployment. It is true, but it is equally true of the restrictive practices which exist in the trade union movement. These practices were created at a time of great unemployment, when men were seeking means whereby they could keep themselves in a job. I do not blame them for that, but we have to face the fact that this year, and for as far ahead as we can see, there is likely to be no unemployment. Therefore, there must be a complete reorientation of our thinking, both on the management plane and by the workers. This is not a party issue. There cannot be anything more fundamental to the future of our country than to seek and find a proper solution to this great problem.
I think that the proposal of the President of the Board of Trade to create a tribunal and, at the same time, to register these practices is good as far as it goes. I am not myself yet satisfied that this procedure will be quick enough to deal with the problem as a whole, and, having
2002
regard to the fact that there are certain practices named by both the majority and the minority Report as being contrary to the public interest, I should like to see such practices scheduled in the proposed legislation. That in itself, I believe, would eliminate many of the undesirable practices which are operating at present and it would certainly do a very great deal to speed up the process of control.
Undoubtedly, this is an issue which excites the public imagination and it is a matter to be dealt with urgently. I am not suggesting for one moment that we must deal with it along the lines of the United States or of Canada. Our approach to our industrial problems here is very different, but the man in the street, the man at the bench, the housewife, everybody in our industrial life, must be shown by action in this house that we intend to take this problem seriously; that we propose to take action which will drive out many of these undesirable practices from our industrial life, and that there is good faith on both sides of the House for an endeavour to seek a proper solution to this great problem.
6.55 p.m.
Mr. Donald Wade: During this debate there have been several references to the expression "a new criminal offence" used in the majority Report. I hope hon. Members will not condemn the majority Report outright merely because of that expression. I will, if I may, refer to it in a few moments and express my own views on that particular aspect of the Report.
It is exactly 110 years since Disraeli said:
"The right hon. Gentleman (Sir Robert Peel) caught the Whigs bathing, and walked away with their clothes."
Since then it has been a popular political pastime to steal the clothing of the Whigs and the Liberals. I have no objection to that. We always have other good clothes in our cupboard. I was hoping that I would be able to rejoice today at the sight of the right hon. Gentleman the President of the Board of Trade unashamedly wearing Liberal clothes, and I should have urged him to go on wearing them and to resist all attempts at persuading him to discard them. But I have some doubt about it now, and I gather from many of the speeches during this debate that a number of hon.

2003
Members on both sides of the House are rejoicing in the fact that the right hon. Gentleman is not wearing Liberal clothes.
I am quite convinced that this is a Report of great importance. I appreciate that the problem is a difficult one to tackle, but I believe if we could start now on the dismantling of this very elaborate system of restrictive practices, which has grown up during the last 25 years, we should be taking a step as important as the decision of Sir Robert Peel to repeal the Corn Laws. Who the modern Sir Robert Peel will be, who will follow him, and who will be left behind I do not know. That is a matter for speculation and for the future.
The problem that we have now to decide is what action to take upon this Report which has been prepared with great care by the Monopolies Commission. I agree with the right hon. and learned Gentleman the Member for Chertsey (Sir L. Heald) that one has to try to look at this dispassionately, and I have examined it from three angles. Firstly I have tried to get the Report in the right perspective; secondly, I have tried to consider what is the underlying purpose of any legislation that may flow from its recommendations; and, thirdly, I have considered what steps should be taken to implement them.
Firstly, on the subject of getting the Report into the right perspective, I agree with the "Economist" leading article of 2nd July—I do not always agree with the "Economist," but on this occasion I do—that the majority Report is a restrained and sensible document. It is absolute nonsense to talk, as some have done, about unrestrained competition. It does not, as the "Economist" points out, espouse the cause of cut throat competition. It is, however, a bold document, and it has been fairly and clearly presented.
Like the right hon. Gentleman, I am glad there has been a majority and a minority Report. It helps us to see both points of view, and I also agree in one other respect with the right hon. Gentleman that there is something to be said for registration. I will come to this in a moment or two, because I am anxious to cover this vast subject as quickly as I can. During the last debate
2004
on this question I broke a resolution I had kept for over five years of never exceeding twenty minutes in a speech.
The Commission has been restricted by its terms of reference. In many respects the recommendations of the majority Report are similar to the recommendations of the Liberal Committee which reported in 1945. The differences are largely due to the fact that the terms of reference of that Liberal Committee were very much wider. On this occasion the Commission was limited in its inquiry, and it has clearly kept within its terms of reference. It has dealt with methods of enforcement, but it has been precluded from considering whether or not certain rules which are thus enforced are or are not against the public interest. A subject that certainly calls for investigation is the effect of these rules themselves as opposed to the methods of enforcing them.
I am aware there has been a general reference to the Commission on the subject of level tendering. I do not know the terms of reference. I do not know how much ground they will cover, and whether they will cover the whole subject of common prices, but it will be a useful investigation and I shall be glad in due course to hear the precise terms of reference. I do not know whether that investigation will cover pre-arranged, uneven tendering or, as it is sometimes called, "collusive tendering." That occurs where manufacturers or contractors agree to parcel out contracts, with one quoting one price, another a higher price and others varying prices in order that the manufacturer or contractor selected gets the contract whilst giving the impression of genuine competition which does not exist. That also should be examined. Again it would be useful to have an inquiry into the effect of Import Duties since 1931 in so far as they encourage or facilitate the growth of restrictive practices. This, of course, may involve legislation to alter the powers of the Commission.
It is clear that all the ground has not been covered by this Report, and the conclusion I draw from that is not that we should delay putting the recommendations into effect, but rather that we should regard them as part of a long-term policy, and, unless we start boldly, I am afraid we may fail in our endeavours.

2005
As to the underlying purpose of any legislation that may be required, it will not be merely to eradicate certain practices which are contrary to the British sense of justice or because certain things have been done which offend British ideas of what is fair or which interfere unduly with personal liberty. We do not want merely to bring down prices, although if the recommendations were carried out they might have that effect. The real purpose is to alter the climate of restrictionism which has prevailed during the last 25 years. That must be the object of Government policy, namely, to encourage not merely private enterprise, but genuine private enterprise, with all that this implies.
To quote the "Economist" once more—I apologise for doing this so frequently—it is important that the Government, in considering the proposals put forward, should remember that "the purpose of an industry" is not
"to provide a fixed number of people with a fixed pattern of jobs at an accustomed and invariable standard of remuneration."
I believe we have a great opportunity, just as I believe that a great opportunity was missed in the years between 1945 and 1950. That was the time, when we were moving out of the war-time era into one of greater freedom, when conditions should have been laid down under which private enterprise would operate beneficially for the consumer. Because freedom does not just happen; it is just as important to plan for freedom as it is to plan for control and restrictions.
That is the purpose of the operation. What are the first steps that should be taken? As I said earlier, there is a case for registration and publication, unless it is shown that the administrative difficulties are too great. The value of legislation is to turn the light of publicity on to these agreements. It could be done quickly. It might be coupled with general registration of trade associations, with a provision that any alterations in their rules be recorded annually. It would assist the public in considering whether the rules of those trade associations conform to the law. I am not satisfied, however, that the proposal put forward by the right hon. Gentleman would succeed owing to the great difficulty of the time factor, and for that reason I believe there will also have to be some alterations in the law.
2006
The registration of restrictive agreements might bring some surprising things to light and might give the public some shocks. On the other hand, it is not fair to suggest that all firms engaged in either manufacturing or distributing are in favour of collective discrimination and of the various methods of collective enforcement mentioned in the Report. As an illustration, may I give the point of view expressed by the Branded Textiles Group, which states specifically that the group—
"has no collective price-fixing or any kind of collective enforcement.…"
That view is held perhaps more widely than the public appreciates, and I do not believe that industry as a whole supports the kind of practices which have been elaborated in the Report. Nevertheless, I am in favour of registration and I do not believe that the trade associations would object to it.
I am a little puzzled by the official Opposition Amendment, which calls for the registration of all collective agreements that provide for the regulation of production and trade. That is extraordinarily wide and would cover all kinds of agreements between employers and trade unions. I do not know whether that is intended, but I should have thought it would have been dealt with separately.
Mr. H. Wilson: If I may interrupt, I thought I made it clear that I was making the same point as the hon. Gentleman made a few moments ago. It was that the Report was made on narrow terms of reference. We would accept legislation to make certain things illegal which were dealt with in the Report, but the proposal for registration was made in order to deal with a far wider type of topics not covered in the Report.
Mr. Wade: Well, I must hasten on. I think there is a case for altering the civil law. The hon. and learned Member for Middlesbrough, West (Mr. Simon) will appreciate that where firms combine together to force another firm out of business or otherwise to damage its trade, the test should not be the object in the minds of those who combine, but rather the natural and probable consequences of the act. That would involve an alteration in the law as laid down in a House of Lords case.

2007
Finally, we have to face up to the necessity for making certain methods of enforcement illegal—as I am limiting my remarks to this Report. The term "criminal offence" has aroused much feeling, but we should not worry too much about it. When we come to ensuring that the new law is not broken I believe that the injunction would be the better method of carrying it out. The point is, is it necessary to make certain methods of enforcement illegal? I believe it is. There should be an escape clause, of course, but we must ensure that this is not so wide that the new law is of no effect.
I am convinced that something drastic must be done. It will not lead to the wild cut-throat competition referred to, but it will be part of an essentially long-term programme. I believe that it will be a major and a difficult operation but, if it is carried out firmly and resolutely, in spite of the storm of criticism that may be aroused, it will not only have far-reaching but beneficial effects on the British economy.
7.10 p.m.
Sir Ian Fraser: I declare an interest in certain companies which practice various kinds of price maintenance. The hon. Member for Huddersfield, West (Mr. Wade)—the only Liberal, I think, who has spoken—nearly made me cry when he showed concern about putting people out of business. I was under the impression that the Liberal Party spent most of its time trying to put us or hon. Members on the other side out of business. What he wanted the House to do was to undertake a drastic surgical operation. I have heard those words two or three times today. I do not recommend drastic surgical operations to my friends when they are in fairly good health.
It seems to me that this country is doing pretty well with a higher standard of living than in almost any other country this side of the Atlantic. With a higher standard of living than we have ever had before and with a wider distribution of wealth and employment than we have ever enjoyed before, I do not think this is the time for drastic surgical operations.
I support the Government because I think that their proposals are less dangerous than those of the Labour Party's
2008
Amendment, and less irrelevant than those of the Liberal Party. I am bound to ask some questions and to make one or two criticisms which, I hope, the President of the Board of Trade will answer and bear in mind. In passing, may I say how ably and competently I thought my right hon. Friend discharged a most difficult task?
What is the public interest? Is the public interest what a number of academic gentlemen on a tribunal think it is, or is it the full employment of our people and increasing standards of living and wages and profits? Let us bear in mind that, without increasing stable and good profits, there cannot be full employment or new industry or new development. What is the public interest and by what standards is it to be judged by the tribunal? That is my first question, and a lot depends on the answer that is given.
It is said that restrictive practices of various kinds and trade agreements of various kinds raise the cost of living. Of course they do. So do the arrangements made by A.S.L.E.F. to have special rates for drivers. So do the demands of the miners that coal should be sold at the economic price. So do all the arrangements whereby doctors are paid and the health services run. The hon. and learned Member for Northampton (Mr. Paget) was not far wrong when he said that a great part of our economy is based upon agreed and arranged prices and wages and so on. Is it really disadvantageous to have steady employment, good profits, good wages and salaries, and an improved standard of living? I think that is a good thing. We need to be very careful before we monkey with the system that has given these things to us.
Much is said about the housewife, and tears are shed for her as if she were the only spender of money in the shops. But she is not that at all. She is a partner with her man in the business of making a living. She helps him to go out and make a living, encourages him, feeds him and looks after the house for him. If it were not for the high employment and good wages which he enjoys and brings home, she would not be as well off as she is. If she has to pay a little more for the certainty of employment that her husband enjoys, and if her cost of living has gone up, so has his standard of living. That should not be forgotten either.

2009
The President puts the onus of proof on to industry. That means that at a certain date certain practices will be said to be illegal, or at any rate immoral, and possibly whole series of agreements or practices will be said to be ultra vires and the manufacturer or and industrialist will have to go to the tribunal to make out his case. The onus of proof is on him. How can he prove that a product which he has in mind will prove to be in the public interest? It may run him into bankruptcy and disaster because he is backing the wrong kind of invention. On the other hand, it may lead to a tremendous boon for a large number of people because a lot of money will be made for him, for those who back him, and for all those he employs.
There may be a young Lord Nuffield up and coming—who knows? He may say. "When I start distributing my motors I want the chap who sells them to understand them. Therefore I am going to limit my sales to half a dozen men at the start and then perhaps later on increase them to 60 men who will really know the car and be able to drive it around and work it." But that will be a restrictive sale. If young Nuffield had gone to such a tribunal, it might have said, "This is a horseless vehicle that we have never seen before, and the restrictive arrangements you have in mind are not in the public interest." How could such a tribunal foresee what was to happen 40 years later with hundreds and thousands of people enjoying motor cars? I hesitate about putting this onus of proof on the manufacturer.
The President says that he is going to approve of individual price fixing. If that means all the way up through—the factor, the wholesaler and the retailer—I am very glad to hear it. He says that he will introduce a clause which will enable such an individually made price fixing arrangement to be taken to the ordinary courts. I am very glad of that. It will make it very much easier to enforce it legitimately, properly and openly than any of the more difficult methods now being used. If he is careful in what he does, he may not upset so many people or our trade as much as at first I feared.
Does the House know that there are 400,000 or 500,000 points of sale in this country—that is retail places where goods
2010
are sold? I know of two or three firms which have 200,000 or 300,000 points of sale. They cannot make 200,000 or 300,000 separate agreements, so they make an agreement with an association.
If one firm makes an agreement with 300,000 retailers through an association which represents one-half or one-third of them, and it enforces it by making the price run with the goods and by going to the courts and that is to be allowed, that is not so bad. That will enable a number of businesses which I know to go on making money. I hope that the President will make some of these points clear. At any rate, let both sides of the House beware lest this tampering with freedom of agreement between individuals leads us into all kinds of difficulties in the future.
Let the trade unions beware that the collective arrangements which they rely upon are not threatened by what we do in this other field. Lastly, let us remember the services rendered by workmen through the trade unions and by manufacturers and distributors through their services, in respect of the margins received. If manufacturers could sell their goods cheaper they would do so, because they want to sell the largest number they can. If they could reduce margins which they give the wholesalers and distributors, they would do so. What they find by experience empirically is the best margin at which to sell the largest amount of goods, and having found it, they enforce it for the great benefit of the whole trade and indirectly to the great benefit of the country.
7.20 p.m.
Mr. Wilfred Fienburgh: It is indicative of the present state of politics that the only two really intelligible speeches defending restrictive practices have been those of my hon. and learned Friend the Member for Northampton (Mr. Paget) and my hon. Friend the Member for Cheetham (Mr. H. Lever).
My hon. Friend the Member for Cheetham based his argument in favour of restrictive practices upon the memories of competitive conditions as they occurred in 1870s, 1880s and 1890s. I would remind him that I was nurtured on Thomas Hood's "Song of the Shirt." I, too, read "Merrie England" when I was very young. But that was some time

2011
ago. If I agreed with him that restrictive practices serve only to produce an orderly system of marketing, never to exploit the consumer and never in any possible circumstances to protect inefficiency, I would join him in his condemnation of the Report of the Monopolies Commission, However, I do not agree with him, for reasons which I shall give later.
My hon. and learned Friend the Member for Northampton drew a rather touching picture not of an economic situation but of a way of life. He said, "Here we are. We do not want to develop into an ulcerated society. We look at America where people get ulcers through going quickly, and we reflect that it is children who run and gentlemen who walk." When I recollect the tempo of delivery which my hon. and learned Friend exercises in this House, I can well understand why he should look with some distaste upon a more speedy approach to a problem.
The fact is, nevertheless, that this is not an amble through life. It is an analysis of an economic way of life. If we are going towards a certain prize and that prize happens to be our food, our raw materials, our standard of living and the economic viability of this country, it may well be that if we amble like gentlemen, the children from America and other countries will nip in and seize our living from us. Consequently, I cannot agree with my hon. and learned Friend. I notice that my hon. and learned Friend has just re-entered the Chamber. He still ambles.
I want now to say a word about the incredible intellectual dichotomy of both the President of the Board of Trade and the Conservative Party generally upon this issue. I congratulate the President on making the best of a very difficult position. In facing up to the problem he could choose whether to save his integrity or his skin. He has chosen to save his skin. He used to speak at the Dispatch Box with what, for him, amounted to passionate emphasis. Time and time again he uttered phrases about the need to deal with monopolies and to create a free competitive economy. He rapped the Dispatch Box with his two forefingers, which is his own way of underlining the particular cliché he is uttering at the moment. Time and time again he posed as the apostle of free enterprise.
2012
But the right hon. Gentleman was in a very difficult position on this issue, because if he had accepted the Report he would have had to endorse the allegation that certain practices which hon. Friends of his have been pursuing for some time to great profit were criminal offences. It has been noticeable during the debate how hon. Gentlemen opposite have a number of times veered away from the allegation of criminal offences and have attempted in so doing to ride off the whole Report.
My hon. Friend the Member for Cheetham did the same. He painted a ghastly picture—I was very sad at the time; I was almost in tears—about the number of directors of the Bank of England, directors in industry, directors of the British European Airways Corporation, and so on, who would be put in prison if this new criminal offence were created.
Constantly in the development of our society we have evaluated new concepts of what is criminal and what is not criminal. There was a time when it was not considered criminal to employ sweated labour in industry and to employ children at the age of four, but the gradual development of our society made those practices criminal offences. I consider that the time has come for us to say that in the evolution of a new kind of society, equipped to deal with the twentieth century, and without condemning too much those who pursued these practices in the past, we ought to say that in the future at least we are entitled to regard the practices listed in the Report as criminal offences.
The President, remembering the sad fate of the previous Minister of Agriculture, had to decide whether he would stand up to the enunciations which he has made on this subject at the Dispatch Box or salvage his political career. He has decided to salvage his political career—for only a little while—and as a result there is little hope of anything being done upon this subject at the moment.
The right hon. Gentleman is not the only hon. Gentleman opposite in difficulty. The entire Conservative Party is in difficulty on the issue. Conservative hon. Members have been constructing a political philosophy in order to hide their moral nakedness ever since 1940. The intellectuals of the Conservative Party

2013
have now, to their own satisfaction, produced a political philosophy of the Right. It goes something like this, "We in this country can double our standard of living within twenty-five years. In order to do that, people must work harder. The way to make people work harder is to give them incentives. Incentives, according to our analysis, are cash incentives. Therefore, we must provide cash incentives in a free competitive industrial society so that people in scrambling for the prizes will somehow lift the whole of the economy out of the mud."
That has been the general Tory political philosophy. The only trouble about it is that we have not got the first prerequisite, which is a free competitive economy in this country. I am not saying whether we ought to have it or not; I have my own views on that. For the moment I am trying to analyse the incredible moral humbug of hon. Gentlemen opposite, for we are entitled to examine it now and again. It consists mainly of this, "We construct a free competitive industrial society. We give prizes and incentives to those who struggle, use their elbows, teeth and claws the best, and that will, somehow, energise the economy, dynamise our way of life, and push everybody up into a higher and better standard of living."
However, we have not got that kind of society. Our society ceased to be competitive after the First World War. During the inter-war years a plethora of restrictions developed, no doubt for sound, reasonable purposes at that time. The Second World War sanctified those practices, and they have continued since the war. The net result is that Britain as an industrial nation has now gone soft; we are flaccid and flabby. One of the main troubles from which we suffer is hereditary management in British industry and the general conception, "If father did it that way, it is all right for me to carry on on the same lines."
There is a reluctance to invest and renovate. There is a keen desire to avoid the ulcerated kind of society. The result is that, bound by restrictive practices, we are developing to a large extent into a stratefied and ossified industrial structure which will prove fatal to our people ten or fifteen years from now in the face of
2014
industrial competition from the younger nations of the world.
It is fair to say that we are suffering from a form of industrial corruption the equivalent of which in terms of moral corruption has pulled down other nations in the past. We must have the kind of society in which we can produce cheaply and efficiently, and one factor in that is the creation in certain sectors of the economy, subject to certain safeguards, of a genuine form of industrial competition.
Hon. Gentlemen opposite are in the terrible position that they either had to accept the Report and enjoy a little moral rectitude or reject it and satisfy the Federation of British Industries. They have decided not only to satisfy the Federation of British Industries, but, what is even worse, to base nearly all their speeches on the free hand-out provided for all hon. Members by the "Aims of Industry." That, of course, has completely exposed the confidence trick, the new mock Tory philosophy. It has proved that, in rejecting the Report, they have also rejected the general incentive excuse. Incentives now turn out not to be allied with competition. Therefore, incentives are no longer a proper instrument in a political philosophy; they are an excuse for making the rich richer in a stratified type of society. They have rejected the general conception which underlies their whole moral, political attitude of the past few years.
What should be the attitude of our side of the House on these problems? First, we have to look at this problem of competition very seriously indeed, as was briefly said by my hon. Friend the Member for Cheetham. Should we, in fact, nowadays continue to be as afraid of competition as we were in the past? Should we still remember the attitude of mind which, as I said before, derives from Robert Blatchford's "Merrie England"? I think we can now afford not to do so. Our industrial structure today can face a stronger competition without fearing that its effects will be borne by the workers and the workers alone, because there is now a new factor in industrial relations and that is the strength of the organised trade union movement.
The organised trade union movement can not only secure, in a competitive

2015
society, by use of its own competitive strength that there should be proper conditions and that competition should not be paid for by exploitation of the workers, but can secure for the workers a higher share of the increased production and higher standard of life, which, one must assume, would flow from increased efficiency.
The second point is whether we should in any case encourage the proliferation of small industries from the competitive point of view. Here we are in some difficulty, because we have to face the facts and acknowledge that nowadays, and here I am beginning to agree to some extent with my hon. Friend the Member for Cheetham——
Mr. L. M. Lever: So my hon. Friend does agree with him.
Mr. Fienburgh: I wish that the uni-Lever trust operated only outside this House.
We really have to face the fact that the day of the competitive, small entrepreneur is gradually declining and that it is no longer possible to revolutionise society by the possession of a screwdriver and an idea. That is one of the basic fallacies behind the whole Tory conception. We now have in this country a growing range of natural and inevitable monopoly. It is not possible to demonopolise, it is not possible to split it into constituent parts, it is not possible to slice it this way, or the other and say, "Out you go into that particular field and you to the other."
There are certain parts of private industry where monopoly is inevitable. All the anti-monopoly legislation and all the anti-monopoly commissions will avail as nothing in face of the pressure of these very rigid economic forces which are determining the pattern of society today. They are felt in the United States of America, where they have had their antitrust legislation. They have a steel industry which works within that legislation and is not regarded as cartelised, or monopolised, but it always happens that whenever steel prices in the United States of America go up they go up from the same price to the same price, by the same increase, at the same minute, of the same day.
2016
I do not think that we can really condemn the United States steel industrialists for that, because here is a field of what I would regard as inevitable and natural monopoly, where, in order to achieve economies of scale, the unit of production must be very large, and the larger the unit of production the more sensible it is to have some form of specialisation between different units, because on the Gargantuan scale one cannot afford the same kind of competition economically—And for the nation it is unsound—that one would encourage between two back street "pubs" in Islington.
When one comes to the larger scale industries and to the question of providing services, gas, electricity, water, fuels, chemicals, steel, transport, then one is reaching a stage, or one has already reached a stage, of inevitable monopoly in which the small man's day is over and in which there can be no realistic competition and no kind of monopoly legislation is viable. It is coming in the motor industry where amalgamations are proceeding all the time. I do not disagree with that. The problem then remains of how we are to deal with and control them and secure that the public interest is helped through the development of these natural and inevitable monopolies. I say that the answer is perfectly clear. There must be one of two things in some parts, and I would say over the wider part, of the industries I have named.
The only answer is to admit that there must be monopoly, not to fight against it, but to insist that it shall be public monopoly, publicly owned, answerable to the will of the people, for good or ill, in this House of Commons; in other words, an extension of public ownership over these basic, natural—[HON. MEMBERS: "Oh."] Hon. Members say, "Oh." [HON. MEMBERS: "The electors did not say so."] The electors said very little of consequence at the last Election.
The return of hon. Gentlemen opposite is not a thing of which they should boast. It is a reflection of political apathy and not of political thought, and if we are in part responsible for that political apathy, then I accept the blame and shall spend the next few years trying to enliven that position, so that there will be less apathy next time. When the electorate thinks, hon. Gentlemen are sitting

2017
on this side and not that side of the House.
Mr. David Price: Do I gather that the hon. Gentleman is saying that the electorate thinks only when hon. Gentlemen opposite are the majority party?
Mr. Fienburgh: I think that that was a maiden interjection and, therefore, it would be unfair of me to comment.
Where there is no public ownership, to resume my point, where, for various reasons, public ownership does not seem appropriate, there must be really genuine and effective public control over these natural and inevitable monopolies. That does not mean receiving a report now and again; it does not mean setting up a board like the Iron and Steel Development Board; it means that the Government and the community must assume power over their credit policy, over their investment policy, over their dividend policy, and over their price policy. The answer of hon. Gentleman opposite is nil. It is to leave them alone and to try to identify certain practices they think to be wrong.
Mr. Henry Usborne: Is my hon. Friend not confusing two points? I agree—we must all agree—that there are certain things, like transport, that are natural monopolies and that in those circumstances no other competitor ought to be allowed to come in. That is one thing and, indeed, I hold that where there is a natural monopoly, it should be owned by the State. At the same time, there is a general integral principle operating in all industries at all levels. That is proper, but these cartels are not necessarily natural monoplies. There is an important difference between cartelisation and monopoly.
Mr. Fienburgh: But where this natural integral process produces a monopoly as its inevitable end, I say that it is a natural and inevitable monopoly, and that we should ensure that that monopoly is responsible to the public interest generally and not the private interest of the people who own it. That still leaves a fairly large and, for some time, substantial residual field of privately-owned industries.
2018
What should be the policy of the Labour Party towards them? I differentiate from the policy of hon. Gentlemen opposite. I believe that in the residual field of private industries, once natural and inevitable monopolies have begun to grow they ought to be placed under public ownership or control. Then, in the rest of industry we should, in the modern context of the modern society, encourage competition to the utmost. Given that the workers in the industry are protected, as they are nowadays by the trade union movement; given that many of the ideas which were created by the depression are now no longer quite so valid; given that we can anticipate, as we can anticipate if reasonable policies are followed, continued full employment; and given that unless we are to have this increase in industrial efficiency the nation will suffer—then, unless we secure our ends by public control, direction and order, the only way of achieving them is by inculcating in that field of private industries a real and genuine competitive spirit.
One of the first necessities is the implementation—and it does not go far enough—of a large part of the Report. But even that would not be enough. I believe that it would be necessary, also, that in certain respects there should be real and vigorous competition by industry established by the community in fields where. it is not possible, or not likely, even removing the restrictive practices, to have sufficient competition to ensure an increase in efficiency.
If the registration of written agreements is replaced by gentlemen's agreements which are decided over a cup of coffee or a glass of whisky, then the State ought to be prepared to say, "We will show you what competition means. If you believe in a competitive economy, and that higher productivity and efficiency flows from competition, and if you are not prepared within your own organisation and industry to produce that competition, then we will do it for you. We will produce competitive industries to challenge you upon your own ground."
Therefore, in a mixed economy, the answer to the problem of monopoly is, first, that we should take into public ownership those natural and inevitable monopolies; secondly, we should publicly control in most details of their investment.

2019
prices, dividends and development policies the other industrial concerns which are developing into near-monopolies. In the residual field of private enterprise where we should see that it is real competitive private enterprise, the trade union's job, in that context, should be to look after the interest and general well-being of its members to ensure that they are not exploited in nineteenth century fashion.
Given that, I think that we can within this country develop the kind of industrial complex which will measure up to the urgent needs of the next fifty years.
7.42 p.m.
Mr. William Shepherd: One thing is very clear, and that is that, wherever restrictive agreements lie, they do not lie on the benches opposite. Almost every speech from the benches opposite has revealed a startlingly different facet of view on the question of monopolies. I was told by the Press that among members of the Tory Party there would be displayed a violent clash of opinion; but this afternoon that clash has been manifest not on this side of the House but very clearly among hon. Members opposite. They are in a pretty sad mess.
Even the right hon. Gentleman the Member for Huyton (Mr. H. Wilson) was in rather a bad mess this afternoon, because he denied that he ever said that the monopoly practices of the Calico Printers' Association ought to continue. I invite him to look at column 1476 of the OFFICIAL REPORT of 24th February, 1955, where he is reported as having said precisely those words. It would have been much more honourable if, having changed his view upon this, or having come to the conclusion that his words of 24th February were unwise——
Mr. H. Wilson: Read them.
Mr. Shepherd: —he had said that he had made a mistake, or that he had changed his view.
Mr. Wilson: Read them now.
Mr. Shepherd: He said:
"My own feeling would be to allow the agreements to continue.…"
Later he said that
"… this was a case where the Government would be justified in resisting the proposals of
2020
he Monopolies Commission …"—[OFFICIAL. REPORT, 24th February, 1955; Vol. 537, c. 1476.]
Mr. Wilson: Will the hon. Gentleman continue the quotation and read the bit that refers to prices?
Mr. Shepherd: The right hon. Gentleman can do that himself. I really do not want to take up the time of the House.
Mr. Paget: Then do not waste it.
Mr. Shepherd: Nothing could be more emphatic that the agreements ought to continue and that the Government were justified in resisting the proposals of the Commission.
Mr. Paget: Read the quotation.
Mr. Shepherd: I will when the House has more time to listen.
Mr. Paget: Read on.
Mr. Wilson: I cannot accuse the hon. Gentleman of unwittingly misrepresenting me; it must be deliberate, because he has looked up the quotation. I made it clear on that occasion, and subsequently, that I was referring to price agreements. If he would read the quotation, it would become clear.
Mr. Shepherd: The quotation refers to the agreements.
I want to deal with the specific aspects of the debate and to say that I welcome the Report, although I am afraid that it is not a very clear one. Its lack of clarity is, in a sense, unfortunate. It lacks clarity because a good number of the practices which have to be dealt with are not under the review of the Commission. This is one of those Reports about which one can say that it might have been better had it been longer. Usually we feel that most Reports would have been better if they had been shorter.
I find the attitude of hon. Gentlemen opposite very surprising, except in two instances. I refer to the two hon. Members who said, "We believe in restriction; we believe in monopolies." They were honest men. They were truly in line with Socialist thought, because no one has done more since the war to erect the Frankenstein of monopolies than hon. Gentlemen opposite. They, at any rate, although they may have earned the disapproval of their hon. Friends, had the

2021
qualities of frankness and honesty, and their point of view was on the whole the more genuine one.
We have had a lot of talk from hon. Gentlemen opposite about State monopolies and private monopolies. Let me say this about the respective merits of these two kinds of monopoly. One can deal relatively easily with the evils of private monopoly. It is a terrible problem to deal with the evils of State monopoly. Hon. Gentlemen opposite do not know how to deal with them. We on this side of the House are finding them an almost insuperable problem. If there is a question of private and public monopoly, quite clearly there is an advantage in having a private monopoly which is susceptible of action. I am not in favour of monopolies.
Mr. Mikardo: Since the hon. Gentleman says that it is easy to deal with private monopoly, will he give some advice to the right hon. Gentleman the President of the Board of Trade who devoted all his speech this afternoon to saying how difficult it is to deal with this matter?
Mr. Shepherd: I ought to have completed my statement by saying that it is much more easy to deal with the evils of private monopoly than to inject into State-run businesses a spirit of enterprise and of service and efficiency. If the hon. Gentleman complains about that, then perhaps we can discuss it at another time.
I feel that there has been a good deal of most unjustified attack upon business people. I say that as one who does not like monopoly and who views with distaste many of the practices in which business people at present indulge. I do not believe that the view taken by some hon. Members is the right one. I do not believe that people in business go out of their way to make arrangements with a view to doing the consumer down. I do not think that they ever attempt to contravene the public interest; I believe that what they may do incidentally does that, but I am quite certain that, on the whole, the business community in this country is the most public spirited community in the whole world. There is too much denigration of business men by people in this House who perhaps do not understand very much about it. There is definitely a case for education but not for the denunciation which sometimes come from the benches opposite.
2022
I turn to the details of the Report, and I say right away that I hope that we shall not have any condemnation of individual price maintenance. I believe that individual price maintenance clearly and positively fulfils the public interest. When people talk about doing away with it, they do not really know what is happening in trade today.
I refer to one industry which is not in a very good state—the furniture trade. I really and truly believe that if we had more price maintenance and more manufacturer selling of furniture, that industry would be much more healthy than it is now. When people compare—as they do—the advantages of selling under competition and non-regulated industry, when they compare the position here and in the United States, they are indeed on a very bad wicket. In this country we have an extraordinarily efficient system of distribution, and we have, let me say——
Mr. Mikardo: What?
Mr. Shepherd: The hon. Member for Reading (Mr. Mikardo), who just scraped home in the General Election, may say, "What," but I invite him to consider the evidence produced by the International Association of Departmental Stores. He will find that the costs of distribution in this country are lower than in any other country in the world.
Mr. George Darling: No.
Mr. Shepherd: The hon. Gentleman may say "No," but I invite hon. Gentlemen opposite to produce evidence to the contrary. I say that the evidence produced by the International Association of Departmental Stores shows that our margins are the lowest of any country in the world.
Mr. Mikardo: Distribution of what?
Mr. Shepherd: It is true that in the United States there are extraordinarily high mark-ups. There it is not an unusual thing to have mark-ups of 60 per cent. or 70 per cent., which allows for a good deal of price-cutting in sales. In this country mark-ups are more of the order of 25 per cent. or 30 per cent., which does not admit of comparison with the United States, so that I hope my right hon. Friend will stand very firm—[HON. MEMBERS: "On what?"]—because retail price maintenance has a positive value which this country ought not to lose.

2023
Coming to the main recommendations of the Report, I should have liked to have seen more sweeping action than is visualised at the moment. We have no choice between sweeping action, on the one hand, and some form of graduated action on the other. The majority Report had in mind making exemptions. In my submission, it would be absolutely impossible to specify exemptions by statute. I defy any hon. Member, or any of our learned clerks, to devise a law by which, on equitable grounds, one could exclude certain individuals, firms or trades from the ambit of the regulations. That would be an utter impossibility, and so we have no choice between a clean sweep or a graduated process.
Mr. Mikardo: Rubbish.
Mr. Shepherd: I consider that, on the whole, what has been decided by my right hon. Friend is by far the best method that could be decided upon in all the circumstances. Indeed, it is a very good best, because it clearly lays an onus on the people on the register. Hon. Gentlemen have been talking as if no progress was being made by putting people on the register. There are on the register people who have been shown by the Commission's Report to have been conducting their affairs in a manner considered in general to be against the public interest. When they get on to the register, people are not in a position of being clear of blame. Unless they can prove that their's is a special case, they will be knocked off the register after a period, and they will not be allowed—[HON. MEMBERS: "How long?"]—we cannot this afternoon talk about how long—they will no longer be able to indulge in those practices.
On the whole, I think that the method chosen by my right hon. Friend, although to some extent it has been limited, is the best in all the circumstances. It is certainly fair, and I think that we should pay more regard to what is fair and just. People who adopt these practices, although they may be grossly mistaken—and I think that they are—believe that what they are doing is not harmful; and it is a good thing that we should bear in mind that to convince them that what is being done is not fair and just is not the main matter under consideration.
2024
No one has yet said, although it is true, that we are now entering a new field of monopoly legislation. We are getting away from the old ambit into an entirely new one. I hope it will be successful. There are difficulties, but I would not say that I am a pessimist about it. I consider that, on the whole, the problems now confronting us are no greater than when we set up the Commission. I consider that the Commission has done better than most people imagine. I see no reason why these obstacles, which I know are real obstacles, cannot be surmounted.
May I now say a word about the particular practices under review? I think that they are the most disagreeable of all the practices indulged in by traders. A straightforward, honest-to-goodness price ring is, to my mind, much more honourable than these seedy, devious methods which are referred to in the Report. It is better to have a frank and genuine price ring than these devious devices which tend to keep trade within watertight compartments. On the whole, these agreements tend to restrict the entry of new people into business. That is a very important objective, and it is a very unreal and unwise objective. I am certain that these devious devices referred to in the Report are highly unsuitable to trade and that we could get rid of them with very little bother.
I believe that we are in danger of overstating the effect of anti-monopoly legislation, and I think that we should steady ourselves a little. We shall not obtain any magic results from anti-monopoly legislation. Prices will not tumble overnight. E.L.M.A. lamps have come in for severe restriction in the last 12 months, but I do not notice any marked reduction in price. Pro-monopolists and anti-monopolists tend to overstate the effect of this practice on industry for two reasons. The first is that when things are very bad, obviously these practices go to the wall. People go round to the back door and sell things at a lower price. When things are very good the restrictions imposed on progressive manufacturers become too great to bear, and those manufacturers leave their association. In the last two months there has been a number of instances of manufacturers leaving an association because they found the restrictions too irksome.

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I believe in the advantages of a free enterprise society. I believe that restrictions and constraints on trade are generally undesirable, and should be abolished. I believe that arrangements between individuals made behind closed doors are a misuse of economic power and, so far as possible, we ought to stop them from being brought about. Where they are inevitable—as in some cases they are—they should be subjected to proper supervision in the public interest. I wish to see trade in this country thrown open to newcomers to come in and try to make their way. I desire to see an atmosphere of adventure and progress rather than enshrined restrictions.
Today we have changed circumstances in this country. It is ridiculous for the right hon. Member for Huyton to talk nonsense about our having laissez faire in this country. It is not true. There is a tremendous change in the whole atmosphere, and it is not a change towards laissez faire, because the Government accept the moral, political and economic obligation to maintain a high and stable level of demand. If the Government accept that obligation, trade associations ought to act upon it. If they have no longer the need to protect themselves—and I do not think that they have—they should not be eager to indulge in these restrictive practices. We are not going back to a policy of laissez faire. We are going in for a policy of ensuring, by Governmental action, a high and stable level of demand.
Some hon. Members have said that we cannot ensure for the whole of the future that we shall have full employment and a high level of demand. Of course, no one can prophesy that that is going to happen, but there are very good reasons for believing that it will. Ten years have elapsed since the war, during which time there have been some very startling economic changes and dislocation. During the whole of that time we have maintained—and not only we, but most of the countries of the world—a fairly high and stable level of employment and demand.
The position is not getting any worse. In fact, we are learning as we go along. We have learned that one of the prerequisites for maintaining full employment and a high level of demand is to see that producers get a fair return for
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their products. In some cases, we have erred in giving too much of a return. We have learned to operate the mechanism. There is no reason why, if there is national effort and international co-operation, there should not be a fairly high and stable level of employment and demand for some years to come.
But, even if that were not so, I would still controvert the point of view that restriction is the way in which to deal with these things. It leads to difficulties when things turn bad. Take Lancashire as an example. Lancashire today is not in a very easy position, and it may well be that if there were absent some of the restrictive practices which obtain in that industry the structural changes necessary to it would have taken place before now. It is debatable whether these restrictive practices necessarily prepare us for the bad times. They may make us impotent when the bad time comes along.
I believe in the free enterprise society. I reject the idea held by some of my hon. Friends that because the area of competition is necessarily small we ought not to try to get competition within it. Because it is small it is all the more necessary to get competition within it. No one does as well as he or she can do unless driven to it by competition. That is the only way in which we can get the maximum effort from the country, and within the free enterprise of this country, in the steel and metal industries and in the engineering industries, lies the future life-blood of the nation. If that is not efficient to the highest possible degree we fail as a nation. Therefore, we ought to have within those industries the highest measure of competition.
I believe that what my right hon. Friend has proposed this afternoon is the practical solution to this problem. I believe it is what the nation needs, and that it implements what the Conservative Party put into its election manifesto. It is one more step on the road towards a freer and more vigorous society.
8.4 p.m.
Mr. Ian Mikardo: If I do not follow the observations of the hon. Member for Cheadle (Mr. Shepherd), it is only because he expressly invited me not to do so. On two occasions during the course of his speech he started a hare and then, when his observations and his

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so-called facts were challenged, he waved his hand airily and said, "Well, we can discuss that at some other time."
The hon. Gentleman had better have a conversation with his right hon. Friend the Leader of the House, because he is taking unto himself to decide what subject the House will discuss at some other time. It is either that, or he is very understandably and very pardonably begging that the House shall not examine too closely the basis of the arguments which he has put forward. I hope that my contribution to the discussion of this very difficult problem will be a little less didactic than his. The trouble with the hon. Gentleman is that he confuses dogmatism with authority. He thinks that if he says a thing firmly and often enough that makes it right. By no means is that so.
Mr. H. Wilson: If I may interrupt my hon. Friend for a moment, I would point out that when the facts of the hon. Member for Cheadle (Mr. Shepherd) were challenged—when he was trying to prove that I had misled the House about calico printing—he failed, despite repeated challenge, to read the next sentence, which said:
"That is the reason for these price-fixing agreements."—[OFFICIAL REPORT, 24th February, 1955; Vol. 537, c. 1496.]
That made it quite clear that I was referring only to price fixing in that respect.
Mr. Mikardo: I am very glad that my right hon. Friend was able to get in that correction, even if it was at my expense. The inaccuracy of the hon. Gentleman's quotation is, I am afraid, no more than a typical example of the way in which he normally treats the House. Of course, he talks with all the arrogance derived from coming from a safe seat and he speaks disparagingly of people who just scrape in. Since the hon. Gentleman is so cocky, and as Reading is looking for a new candidate, I invite him to come along to fight the Reading seat at the next Election.
Mr. Shepherd: Much as I enjoy the company of the hon. Gentleman, I prefer to stay where I am.
Mr. Mikardo: I should jolly well think so.
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The President of the Board of Trade is not the only member of the Conservative Party busy saving his skin today. This problem is clearly one of timing. It is a problem of the speed at which Governments should take action in respect of the matters which have been laid before us in the Report of the Monopolies Commission.
Very few of us in this House knew when we came along today what action the President of the Board of Trade would propose. We all knew, of course, that he would propose something, whether or not he and his colleagues in the Government agreed with the view of the Monopolies Commission that the practices which it had examined were universally contrary to the public interest. We knew that, whatever the right hon. Gentleman felt about the merits of these practices, he would be bound to propose some action because, otherwise, he could not justify the speeches which hon. Members opposite have been making these last few years, or the posters which they have been putting up all over the country.
What sense would there be in setting the people free or in claiming that the so-called paradise in which we live comes about because industry has freedom to get on with the job? What sense would there be in saying, as the right hon. Gentleman said today, "We are and we remain a party of free enterprise" so long as, virtually at the same moment, the Monopolies Commission refers to the exclusive dealing which is going on as being "an extreme interference with the freedom of the subject to carry on any lawful business"?
It was clear that the Government would have to propose to do something to expunge this challenge from the record, because here is a majority of the Monopolies Commission, whose eminence and fairness no one can dispute, saying that in this country there is not freedom for industry to get on with the job So the question which faces the President of the Board of Trade, the problem which he has been arguing with the 1922 Committee these last few evenings, is, since he has got to do something, should he do as much as it is right to do, or should he do as little as he is compelled to do?

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Those who listened to the right hon. Gentleman this afternoon will know that he has come down in favour of doing as little as he is compelled to do, and to do that as slowly as he can get away with it. Indeed, almost all the pleas from hon. Gentlemen opposite today have been to do as little as possible and as slowly as possible. The hon. Member for Cheadle said we should steady up on anti-monopoly legislation. But the right hon. and learned Member for Chertsey (Sir L. Heald) went further. He campaigned against any intention whatever to do anything, or to take any action which would be characterised by simplicity and speed.
The right hon. and learned Gentleman, with the tortuousness which his profession sometimes imposes upon those who practise it, said, "Let us choose a method of dealing with this urgent problem that is slow and complicated. Let us not have anything that is quick or simple." If the President of the Board of Trade really meant what he said in his peroration——
Mr. G. Darling: Nobody could believe that.
Mr. Mikardo: Not even the right hon. Gentleman could believe it. But if he had meant it he would be seeking for the quickest possible method. He says, "We will have a Bill." He does not say when. Let us try to work out the timing of this matter. The last time that the Government said we were to have a Bill was in the Gracious Speech in November, 1951. We still have not had the Bill—and that is nearly four years ago. So, unless the Government have speeded up their productivity, we may have this Bill in anything up to four years' time. We shall certainly not get it until 1956; I think that that is clear.
We shall eventually have a Bill. Under that Bill, the President will set up a tribunal. We know that that is a slow process—sometimes inevitably so. People have to be found to make up the tribunal. Up till now the President has not given very much thought to the question of what sort of people he should have. He was just playing around with this question today. That will take a very long time. Then, when the tribunal has been set up, it will have to get staff from somewhere—and that will take a little longer. Then it will have to start up all the machinery of registering agreements.
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The hon. and gallant Member for Ilford, South (Squadron Leader Cooper) warned the President that the tribunal might have to register as many as 10,000 agreements and, said he to his right hon. Friend, "Do not imagine that you will do that in a hurry." The President knows that; that is just what he is after. He wants a method which cannot be carried out in a hurry. After all these agreements have been registered the tribunal will sit down and go through them—and there may be hundreds, or even thousands—and, by a process of "Eeny, meeny, miney, mo," it will pick out one and say, "We will call upon the manufacturers of elastic-topped socks"—for example—"to tell us why their agreement is in the public interest and should be maintained."
Those manufacturers will come along, and, unless the tribunal is more high-powered than the Monopolies Commission—and we have no reason to suppose that it will be—experience goes to show that answering that question will take about two years. I suppose that a Member of the Government will reply to the debate. I want to ask him a direct question. My estimate is that, at best, the first action flowing from this tribunal will be available in 1959. Does he challenge that estimate? If so, will he justify his reasoning and give us particulars of the time-table which leads him to believe that it will come just before that date, or at any time before that date? If he cannot do that, will he please say whether, in all conscience, he thinks that the measures proposed today are or are not an honest implementation of the promises which his party has been making in the last two election campaigns, about action to be taken against monopolies?
Mr. Shepherd: Does the hon. Gentleman realise that the tribunal will be faced with an entirely different situation from that which faced the Commission? The Commission has already inquired and has concluded that, in general, these practices are against the public interest. They are registered as such, and it is merely the duty of the tribunal to call firms or associations before it to see whether they can show that, contrary to the general experience, their agreements are not against the public interest. That will take merely a day or two.
Mr. Mikardo: I should be very glad if that were to happen, but I do not share

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the hon. Member's view in that respect. We are clearly both forecasting—and neither of us can speak with authority—but the Monopolies Commission, too, has been able to find out in a matter of a day or so what agreements existed in a certain industry, and it nevertheless took the Commission about two years to report. I do not criticise the Commission for that; it is a complicated business finding whether an agreement—the facts of which are admitted—is against the public interest in its operation. From every word the President said today it seems to me that the tribunal will have to do precisely what, up till now, the Monopolies Commission has had to do.
The Attorney-General (Sir Reginald Manningham-Buller)The Attorney-General (Sir Reginald Manningham-Buller) indicated dissent.
Mr. Mikardo: The Attorney-General shakes his head, but the only difference between the two bodies is that at the end the tribunal will have some teeth, whereas the Monopolies Commission has not. Mc tribunal's powers are stronger, and I welcome that fact, but the method through which it will reach its findings can only be the same method as that of the Monopolies Commission.
The Attorney-General The Attorney-General indicated dissent.
Mr. Mikardo: I am sorry that the right hon. and learned Gentleman does not agree. The Monopolies Commission has made its inquiries upon the basis of ascertaining the facts. I hope that the right hon. and learned Gentleman is not suggesting that the new tribunal is not going to act on that basis, because, if he is, we shall be a little more suspicious than we would otherwise be of any dream-child of the present President of the Board of Trade.
We shall not disentangle this problem unless we first trace the motives which tie behind the present practices. I agree with those who say that, on the whole, British business men do not sit around saying, "How can we chisel the public; how can we pull a fast one?", but they do sit around saying, "How can we make more profit?" If the answer to that question results in some unfairness to the public the business man is faced with a double loyalty. Is he to be a citizen first, or a business man first? Ninety nine times
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out of a hundred, if he were a citizen first and a business man second, his shareholders would sack him and choose somebody who was a business man first and a citizen second.
There is only one answer. We should not run away from the profit motive element in this business. Like my hon. Friend the Member for Loughborough (Mr. Cronin), who made what I thought was a remarkable maiden speech, I do not condemn people in business for seeking to maximise their profits—so long as there is a profit sector of the economy that is what they will do—but I do condemn people who, in this instance—and I condemn nobody more than the F.B.I., who published a whitewashing statement upon this subject a few weeks ago—try to make us forget that there is a profit motive in this matter; because if we do forget it we shall get the whole problem distorted.
Some hon. Members have complained that "Aims of Industry" sent us all a pamphlet, because they thought that it was rather a slur upon our intelligence. They take the view that "Aims of Industry" imagines that hon. Members are not capable of speaking for themselves without the help of "Aims of Industry." But what the F.B.I. did is worse. A week or so before the Monopolies Commission Report was published the F.B.I. published a statement trying to turn it aside. It did worse than "Aims of Industry." It did not pretend that Members of Parliament are not capable of speaking without its assistance; it seemed to imagine that Members of Parliament are not capable of thinking without its assistance and of reading the Report of an independent Commission and making up their minds about it.
I read the F.B.I. document with great interest, and I extracted a list of no fewer than twenty different reasons why the F.B.I. was in favour of restrictive practices. I shall paraphrase them. It says that firms may have restrictive practices for any one or more of the twenty following purposes: to safeguard the public interest; to increase exports; to look after the consumers—[Laughter.]—that is what they say—to look after the workers; to avoid price wars; to increase investment; to avoid bankruptcies; to eschew unemployment; to maintain efficiency; to offer a dependable quality

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and service; to take advantage of new techniques; to avoid fluctuations in demand; to make full use of resources; to keep prices down; to encourage research; to exchange statistics; to visit each other's factories; to educate and train their staffs; to protect small firms, and to keep distributors on their toes.
Those are the twenty reasons given by the F.B.I. for restrictive practices. The F.B.I. did not include as one of its reasons that sometimes some firms or groups of them might go in for restrictive practices to make a bit more profit. We simply must have some sort of public honesty about these matters or we shall not get the thing clear at all.
What happens because they talk in this way and hide their real motive is that very often people talking about and justifying restrictive practices are really rationalising their own emotions and their real reasons. Many of the defences put forward for restrictive practices just will not stand up to any practical examination.
I am following the lead of various hon. Members on both sides of the House in not trying to make any moral judgment about this. I do not know that I am competent to make moral judgments about other people anyway. I want to look at the argument from a purely practical point of view. In particular, I want to examine what seem to me to be the only three important arguments put forward by restrictionists to justify their behaviour and to see how far they stand up.
First, restrictionists say—we had it in the speech of the hon. Member for Morecambe and Lonsdale (Sir I. Fraser)—that firms are entitled to restrict their distribution through certain channels where they know that those channels will give proper service. The argument is that these restrictive arrangements ensure better service for the consumer than he would otherwise get. Without reading it all in detail, I ask hon. Members to read paragraph 80 in page 28 of the Commission's Report and paragraph 90 in page 31, which go to show—and it seems to me that this part of the Commission's examination, even for that body, was particularly close and careful—that not only do people who are not restrictionists give as good service as people who are, but that in many cases the actual operation of the restrictive agreement diminishes the
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possibility of the manufacturer or the distributor giving the best after-sales service.
The real give-away is this. A manufacturer of an engineering product says, "Only XYZ Company can sell my products because it is the only firm with staff, equipment and facilities to give service"; and so the XYZ Company is appointed distributors. After that, the manufacturer never again goes to check whether the standard of service is being maintained, whether the XYZ Company has not sacked all its fitters, or whether its machine tools have not run down. The Commission says in the most explicit terms that it has received no evidence that manufacturers who choose distributors on their own showing for their ability to give service, subsequently check whether that ability continues to be maintained.
Mr. R. Gresham Cooke: To give one example from my experience in the motor industry, motor manufacturers have factory representatives whose one job is to go around and see whether distributors are up to the mark.
Mr. Mikardo: The Commission took evidence from the motor trade. I do not want to read great lumps of the Report, but the Commission says explicitly in two different places that there is no evidence that manufacturers ever so much as consider deleting a distributor's name from their lists because he has ceased to give good service. In another place, the Commission says that there is no evidence to show that the ability to give service is checked as a regular routine thing—and it had evidence from the motor trade.
The hon. Member knows how assiduous these trade association are in sending inspectors, sometimes heavily disguised, to check that people are not cutting prices. Will he tell me that they are just as assiduous in sending inspectors to check that people are not cutting the standard of service? The hon. Member knows perfectly well that they do no such thing. If the motive were genuine, manufacturers would be just as assiduous in doing the one job as they are in doing the other job.
The tribunals haul up traders who cut prices. Has anyone ever heard of one

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of these "Star Chamber" courts hauling up a trader because he has not given good service to a customer, and punishing or fining him for it or putting his name on a stop list? Yet if there were anything in this bunkum, this hypocrisy, that this is done to ensure service, that would happen just as much as hauling up people because they are cutting prices.
I ask any hon. Member who has had the good fortune which I have had of spending some time in doing shopping in the Dominion of Canada, where they do not have these arrangements, whether he found any difficulty at all in getting after-sales service in Canada for anything he chose to buy. I ask the House to believe that after-sales service standards there are certainly no lower without any discriminatory practices than they are in this country.
The second of the three justifications that I want to examine is the argument that these restrictive practices facilitate a greater degree of standardisation in manufacture. Let me say at once that I am a fanatic about standardisation. I believe that it is the one thing more than any other which can raise productivity in this country and I would be almost prepared to accept restrictive practices if they gave rise to a greater measure of standardisation of method of manufacture and of end product. Again, the Commission has had a look at this aspect and finds that not only is it not true that these restrictive practices create more standardisation, but that in fact they interfere with what standardisation there is. If hon. Members like the reference, they will find the passage concerned at the end of paragraph 93 and the beginning of paragraph 94 in page 32 of the Report.
Perhaps I might quote a single example. The Commission referred particularly to the evidence of the Railway Executive, as a very large buyer, that it would arrange to centralise its purchasers to a much greater extent were it not for the fact that the rainwater goods agreements prevented the Executive from obtaining any appreciable advantage in price by so doing. If I had to pick one single thing that British industry most needs—and it needs a lot of things—one thing that it needs more than any other is an arrangement out of which great
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price advantage can be got through increased standardisation. But the Commission shows that great price advantage is not obtained, however much one standardises, in a situation in which there are restrictive agreements.
Thirdly, I should like to refer to a matter which has been mentioned already: that is, the question of investment. One of the justifications given for restrictive agreements is that because they exist, they give stability. I wish that people would not make a god out of stability. Stability is a static situation and our industry wants dynamism, not a static outlook in life. It wants, not stability, but adventure, a bit of pluck and guts about it, instead of looking always for security and stability. It is argued that we get stability and that, because there is stability, we get more investment.
Of course, it flies in the face of all the facts. There is no evidence at all that the restrictionist trades invest at a higher rate, taking all other factors into account, than the non-restrictionist trades. There are not available any comprehensive, detailed statistics, but I have not been able to come across any evidence at all that the restrictionist trades have increased their investment as much as some other trades in which there is no restriction at all. Of course, that is not surprising, because nothing so destroys the impetus to modernisation as absence of competition. Why should a man buy a new machine to make his product a bit more quickly if he is guaranteed that with the existing machine he will sell his product, however much more it costs to make because the machine is running down?
Again, let us compare what has happened in the United States. I agree with those of my hon. Friends, notably my hon. Friend the Member for Islington, North (Mr. Fienburgh), who have said that the Sherman legislation works only imperfectly. That is true, of course, but we know that there is much less restrictionism in the United States than here and that there is much more industrial investment in the United States than there is here—very much more. It follows, therefore, that there is not any correlation between restrictionism and investment.

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The two alternatives put before us by the two sections—if I may call them that—of the Commission were on the one hand registration and publication and on the other hand statutory action. I can see why the Commission divided on this question. I can see there is not a clear-cut, black and white argument, but that there is a balance of argument. I happen to agree with the majority that registration and publication will not do enough in themselves, will not do as much as even the President of the Board of Trade seemed to suggest that he hoped they would.
I advance on this question two considerations. First, there is the experience of Sweden, which has been referred to. Sweden has had these restrictive agreements registered and published since 1946. If registration and publication were sufficient Sweden would not have had to do anything else, but last year Sweden nevertheless found it necessary to put a statutory ban on two forms of restriction, on resale price maintenance and on collusive tendering. I think it is reasonable to argue from Sweden's experience that, having tried them out patiently for eight years, Sweden found registration and publication insufficient to correct abuses. It had to take some statutory action as well.
Secondly, I adduce our own experience in this country with cast-iron rainwater goods. It is now some years since the Commission investigated that trade and found some practices to be reprehensible, and published them in one of its Reports. There were then the usual discussions with the trade about what was to happen. On 27th November, 1951, the right hon. Gentleman who was then Minister of Works answered a couple of Questions on what was happening about those practices, which the Commission had condemned. He said:
"My Department has held discussions with representatives of the manufacturers and merchants concerned and has received an assurance that new trading arrangements to carry out the recommendations of the Monopolies and Restrictive Practices Commission will replace the present agreements. I should like to place on record my appreciation of their co-operation."—[OFFICIAL REPORT, 27th November, 1951; Vol. 494, c. 129.]
That, I repeat, was on 27th November, 1951. Yesterday, Councillor E. S. Bishop, of Bristol City Council, announced that he had been having a look
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at tenders received by Bristol City Council during the last year, from 1954 to 1955, not 1951, and he said that in the past year there had been 100 per cent. level tendering for cement, salt glaze ware, and cast-iron rainwater goods.
So that we see that the manufacturers and merchants who had to suffer publication of their practices in 1951, and all the obloquy of condemnation by the Commission, and who had discussions with the Government and promised a Minister that they would do something about it, simply then proceeded to thumb their nose at the Government, thumb their nose at the Commission, thumb their nose at the British public, and thumb their nose at the local authorities which buy from them. I should dearly like to know, in the light of this situation, whether the right hon. Gentleman who was then Minister of Works and is now Minister of Education would still want to record his appreciation of the industry's co-operation.
This is not a problem to tinker with, but a problem that demands action. The President of the Board of Trade may have gone out of the Chamber a little while ago saying, "Boys, I have got past that one. I have found a formula." But he will not get away with it for long, because as the years go by and the tribunal does nothing and no action is taken, and the public, and more and more city councillors, complain about collusive tendering and other practices which are included in the Commission's terms of reference, the right hon. Gentleman will find that a formula is not enough to protect him from having been too cowardly to take effective action.
8.36 p.m.
Mr. R. Gresham Cooke: We have listened to many interesting, constructive and courageous speeches from both sides of the House on the subject of the debate, but I was not so impressed by the speech of the hon. Member for Reading (Mr. Mikardo). The hon. Member conjured up a rather horrific picture of the tribunal going on for years and years looking into cases of individual industries, but I cannot visualise the tribunal working in that way. I imagine that the tribunal which my right hon. Friend the President of the Board of Trade has in mind is probably a judicial or professional one, spending all its time

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hearing cases quite quickly, perhaps taking evidence on oath, with the result that each industry may be disposed of in a few days.
I should like to correct the hon. Member for Reading on another facet of his argument. He mentioned that distributors had not been taken off the list by the British Motor Trade Association for lack of service, but the checking of service is a matter for individual manufacturers. They send round representatives and I have known from my own experience of distributors having their contracts taken away from them because their service was not up to the manufacturers' requirements.
Mr. Mikardo: When the hon. Member thinks that he is correcting me, he is correcting the Commission, because I was quoting from the Commission's Report. If he thinks that the Commission is wrong and he knows the Commission's address, perhaps he will be good enough to send it a letter. In the meantime, I take the Commission's view as slightly more authoritative than that of the hon. Member.
Mr. Gresham Cooke: That is as it may be. I have not read that part of the Report.
Hon. Members: Oh.
Mr. Mikardo: Then the hon. Member should not talk about it.
Mr. Gresham Cooke: I am talking about something from my own experience.
If I may bring the debate back to its subject, we are not discussing monopolies, price rings or collusive tendering. We are discussing only certain trade practices which are carried on by hundreds of trades, the chief one being collective resale price maintenance. That can take place in a highly competitive industry with a number of manufacturers in hot competition with one another. The manufacturers settle their prices and uphold them by means of an association.
As I know something about it, I should like to give an example from the motor industry of how these things work. It is not generally known that the British Motor Trade Association, of which I was not a member and with which I never had anything to do, has been in existence for about 45 years with the object
2040
of securing the maintenance of prices. One of the reasons for its existence is that in the motor industry a manufacturer may have 1,000 dealers who are signed up in contract to him. He can in those contracts require those 1,000 dealers to adhere to a nationally advertised list of prices, but in a large trade such as the motor trade there are another 16,000 dealers who are not under contract to the manufacturer. So the manufacturer relies on the use of the association to see that these remaining dealers maintain the advertised prices.
An association such as the B.M.T.A. is a trade union and is set up under the Trade Union Acts, 1871 and 1876. It is like any other trade union, and as such it is prohibited from entering into any legal proceedings to recover damages for a breach of any agreement between its members. That is why that trade association and many others have set up their own courts or their own committees. When such bodes have been tested at law in the House of Lords, their functions have been found to be within the common law and to be perfectly legal.
The fact that these restrictive practices exist in industry does not mean, as the hon. Member for Islington, North (Mr. Fienburgh) said, that the industry is ossified. Far from it. The motor industry has been the foremost exporter from this country, yet it has had these arrangements for many years and is far from being ossified. The particular reason why it has had these arrangements is to maintain a dealers' organisation for after-sales service, because vehicles are capital goods which require the provision of a national network of service points all over the country.
A person may take delivery of a vehicle one day in London and a few weeks later in the North of England require the replacement of some part of it. There has got to be a dealer who has stocks, and in order to see that these dealers are kept in business and are able to build up adequate stocks, they have to be supported by adequate margins.
There has been a good deal of talk in the Press and some here today on the question of secret courts, "Star Chambers" and so on. I think this can be exaggerated. If a jockey slashes another jockey at Ascot he is brought up before his "Star Chamber" or secret

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court, the Stewards of the Jockey Club. If a lawyer charges below the minimum fees he can be called before his own "Star Chamber," the Benchers of his Inn. If a trade union member breaks the rules he can be brought before his own committee or "Star Chamber," and if a clubman kicks a Minister of the Crown down the steps of the club he is had up before his own "Star Chamber," the committee of the club. All these are really committees of the institution.
In order to meet the criticism that was made in the past, the motor trade tried to make its committee as impartial as possible. It appoints an independent chairman, generally an ex-colonial judge. [Laughter.] Yes, a high legal official, who has to work to a set of rules, and the established procedure allows the members to be represented by counsel or solicitor. It is the opinion of the trade that this is speedier, less costly, and leads to rather less personal antagonism than having the case fought out in the courts where the remedy is either damages or an injunction. Certainly that would not be the proper remedy—to put a man out of trade altogether.
Sir L. Heald: Would my hon. Friend deal with the case of non-members?
Mr. Gresham Cooke: Certainly, nonmembers are given the opportunity of appearing before the court. They can go or not, as they wish. I know there are many difficulties, but since at the present time a trade association cannot bring these cases before the courts, it is not easy to find a remedy.
One remedy might be for these private trade courts to be controlled by statute. For instance, the Potato Marketing Board has a disciplinary court and is able to impose fines. It keeps a list of registered dealers and operates under regulations. So it might be that the way to deal with this matter would be to put these trade courts under regulations under statute, just as doctors and solicitors have their own committees which are under statutory control. I put that forward as a suggestion.
We are facing an extremely difficult problem in resale price maintenance and collective enforcement. I liked the suggestion made by my right hon. and learned Friend the Member for Chertsey (Sir L. Heald) that a legal arrangement
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might be made for the price to follow the goods. The difficulty I visualise in the trade about which I know something is that if the British Motor Trade Association were wound up, an arrangement would have to be made about the 850,000 separate contracts. In other words, the 50 manufacturers of vehicles would have to enter into separate contracts with each of the existing 17,000 dealers or garages. That would be a cumbersome method.
I was as surprised as was the hon. Member for Cheetham (Mr. H. Lever) to read in the Report:
"We have not in the course of our inquiry come across any instances in which we were clearly satisfied that such practices were beneficial."
For eight years I was Secretary of the National Advisory Council of the Motor Industry. For six of those years we were pressed by hon. Gentlemen opposite, as the Government of the day, to keep the covenant scheme on motor cars in operation. The right hon. Gentleman the Member for Vauxhall (Mr. G. R. Strauss) will remember that those were the days when the Morris Minor, listed at £300, would have sold for perhaps £1,000. By a voluntary arrangement through the trade the public was restricted on the resale of motor cars first for one year and then for two years.
I am not suggesting that because we were pressed by the Government at that time it was necessarily a good public service, but it was much applauded as such, and it could not have been carried out without the use of a trade association. There were many more cases against dealers for over-charging than there were for under-charging—1,200 of them. There have been 250 cases of under-charging in the last few years. In actual fact, I believe that there are more cases at the present time against people who are over-charging for models in short supply than there are of under-charging. That is a public service whch will help to keep inflationary tendencies in check.
As the President said, this is a very deep and complicated question which affects all trades. I think that the registration of these trade agreements is very much on the right lines, as it will bring the light of day on them. For individual trades to submit themselves to an examination by an impartial tribunal under defined rules is obviously a further step in the right direction. I hope that

2043
the tribunal will be a professional or a judicial one. In my opinion, the President is taking two big steps in the right direction in the very difficult and complicated field of resale price maintenance.
8.51 p.m.
Mr. J. T. Hall: I want to say a few words on behalf of the local authority in my constituency, which has drawn my attention to certain practices in relation to their tenders which they believe to be against the public interest. Since receiving that complaint, I have taken a great interest in the speeches of my hon. Friends here tonight. I feel that this is a growing evil which ought not to be allowed to go on. I am glad that the Monopolies Commission, in its majority Report, has made recommendations that the Government should take action on certain practices which they feel have a tendency to put up prices. I am sure that that is a step which will be welcomed by the public.
It is a fact that there is a creeping inflation in the country, and I have no doubt that it is caused to a great extent by restrictive practices. I feel that there would be greater confidence in the public mind if it knew that it was getting value for its money. While there are monopoly practices by big business and price rings by trade associations, we shall always be having wage claims by the trade unions, which have to protect their members from the rising cost of living. I would say that the Government have great responsibility in this matter.
As supplies have become easier, the Government have neglected to safeguard the individual consumer by dismantling the central and local price regulation committees which did a great deal to control pries. As a consequence, in trades where production is concentrated, as in the case of cement or steel, or where powerful trade associations are able to enforce restrictive practices, there is always a danger that unnecessarily high prices will be charged.
As the House knows, there were reports on dental goods, the supply of rainwater goods, electric lamps, electric wires and cables, and so on. The Monopolies Commission has stated that, in its opinion, prices would tend to be lower if the system of restrictive practices designed to
2044
eliminate competition were abolished. In the case of the match industry, manufacture is in effect a one-firm monopoly. The evidence placed before the Monopolies Commission showed that the British Match Corporation was able to eliminate outside firms which were likely to compete with them in the United Kingdom and regulate competition from abroad by cartel arrangements.
There is one drawback about the findings of the Commission. The Government have failed to follow up the Commission's Reports. In only one case has statutory action been taken, and that was by the Labour Government. I was pleased to hear from the President that more positive action will be taken by the Government. The Commission will be wasting its time if it makes recommendations and the Government do nothing about them. It is all very well to say that consultations have taken place between the Government and trade associations and that restrictive practices have, as a result, been relaxed, but if the Government refuse to publish information, the public are bound to suspect that nothing has been done.
I now come to the experience of the Gateshead Town Council. When I said that restrictive practices were growing I had in mind that for the first time Gateshead Town Council have received identical prices in their annual tenders. One of the principles laid down by the Ministries of Transport, Health and Housing and Local Government is that for the supply of goods and materials local authorities must accept the lowest tender. It is only when previous experience has proved a contractor unsatisfactory that Ministries allow a choice other than the lowest tender. What do Ministers say when all the prices are identical? At the moment there is nothing in law against it. Yet councillors and even the Minister must feel that it is against the public interest.
I believe that having to accept the lowest tender is sound. It brings in the element of competition. It helps to keep prices down. It gives encouragement to enterprising firms, and makes other firms more efficient. On the other hand, the restrictive practices of trade associations are bound to raise prices higher than they should be. They prevent the enterprising

2045
firm from expanding and protect the inefficient firm from the penalty of its inefficiency.
When Gateshead Town Council invited tenders for the annual supply of goods and materials, the prices quoted were identical to a penny. For the supply of cement, six firms quoted exactly the same price of £7,417 6s. 3d. For broken whinstone and whinstone chippings five firms tendered. One firm was ruled out on the grounds that the tender did not comply with the specification. The other four firms tendered at the one price of £1,503 Os. 5d.
There was a slight variation in the case of salt glaze ware pipes and fittings. One firm found that it could tender at ½d. less than one other. The prices quoted by four firms were, respectively, £2,355 2s. 10d., £2,355 2s. 11d., £2,355 3s. 4½d., and £2,355 3s. 5d. I could give other illustrations, but in deference to my right hon. Friend who desires to speak I will refrain from doing so.
The burden of increasing rates is a matter of deep concern to everybody in all parts of the country. Councillors have added responsibilities through new Acts of Parliament. They have huge commitments in building new houses. They are expected to carry out slum clearance schemes. There are numerous new schools to be built. With ratepayers grumbling about the high rates, councillors have every reason to be shocked when they find price rings operating which make the rates go even higher.
This matter of price rings therefore becomes one of great urgency. The local authorities are afraid that if price rings are not dealt with their work of providing houses and schools and other buildings will become an intolerable burden on the ratepayers or the work will have to be abandoned or retarded.
The Government have a great responsibility. The Monopolies Commission has shown that restrictive practices are against the public interest, and we have more and more of them reported in the Press every day. I hope that the Government are to take strong action, because it will need a rigorous policy to succeed against these monopoly organisations which are very strong today. I hope that as a result of the debate it will not be long before the Government bring forward legislation to
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enable these undesirable practices to be ended.
Mr. Ellis Smith: On a point of order. Having sat here for the whole of the debate and having been prevented from speaking, I cannot be prevented from raising a point of order. I want to keep myself in order. I know that I am not allowed to ask you, Mr. Deputy-Speaker, why my Amendment was not called. However, it will get on the record and be read outside and that will suit my purpose.
Many of my hon. Friends who are well-informed in this matter have not had an opportunity of speaking in this democratic Assembly. An hon. Member who desires to speak in support of my Amendment has not had the opportunity of doing so, so I therefore beg to move, "That the debate be now adjourned."
Mr. Deputy-Speaker (Sir Rhys Hopkin Morris): I cannot accept the hon. Member's Motion.
Mr. Smith: Well then, Mr. Deputy-Speaker, can we be told on what grounds it is not being accepted?
Mr. Deputy-Speaker: The Standing Order provides that acceptance shall be at my discretion.
Mr. Smith: This means then——
Hon. Members: Order.
Mr. Deputy-Speaker: The hon. Gentleman cannot pursue that now.
Mr. Smith: Further to that point of order. I should like to know upon what grounds hon. Members who have been here for twenty years, and who have sat throughout the debate, have not had an opportunity of speaking. I compare them with others who have been called.
Mr. Deputy-Speaker: The hon. Member has been long enough a Member of the House——
Mr. Smith: Yes, I remember.
Mr. Deputy-Speaker: —to know the rules as well as I do.
Mr. Smith: Yes, I know them all right.
9.3 p.m.
Mr. Herbert Morrison: May I join with other Members in extending my congratulations on their

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speeches to the two maiden speakers today, the hon. Member for Epsom (Mr. Rawlinson) and my hon. Friend the Member for Loughborough (Mr. Cronin).
It may be as well in this concluding speech for the Opposition to recall to the House the restrictive practices which are under consideration in the debate. They are set out in paragraph 29 of the Report. Firstly, there is:
"Collective discrimination by sellers (without any corresponding obligation on the buyers)."
That is to say, discrimination by the sellers as to whom they will sell and under what conditions.
Secondly, there is:
"Collective discrimination by sellers in return for exclusive buying."
That is to say that they enter into discrimination in favour of those who will exclusively buy from these sellers. Thirdly, there is:
"Collective adoption by sellers of a policy of maintaining resale prices, or imposing other collateral trading obligations on the buyers."
Fourthly, there is:
"Collective discrimination by sellers to enforce resale prices or other contract terms."
Fifthly, there is:
"Collective discrimination by buyers (without any corresponding obligation on the sellers)."
The sixth point is the matter of "aggregated rebates."
There is involved in the extensive exercise of these restrictive practices private organisations who, from the public point of view, are necessarily irresponsible. They have no accountability to any public authority and no Minister can effectively answer for them in Parliament. This substantial list of restrictive practices means that, to that extent, economic functions are assumed by private trade associations and exercised by them entirely upon their own responsibility. The whole purpose of these practices is to restrict, to interfere with, the functioning of private enterprise, and so that principle is involved.
I want to say on that only that if we are to have a public sector of industry and a privately owned sector of industry—and that is likely to last for some time to come—[HON. MEMBERS: "Hear, hear."]—as is the publicly owned sector of industry, and it may well grow; but
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if there is to be a privately owned competitive sector of industry, which hon. Gentlemen opposite are very glad to hear about, then do let it be enterprise, and let it be free.
Hon. Gentlemen opposite cannot have it both ways. They cannot advocate free, competitive enterprise on an individualistic basis and then have the tacit assumption of these economic powers by private trade associations that interfere with the freedom of the competitive character of private industry. Moreover, there is involved the rights of citizens in production and in distribution. Their individual rights are interfered with. They are ordered about. They are required to conform with certain rules and regulations imposed upon them by trade associations, either sellers' trade associations, or producers' or buyers' associations.
As has been emphasised by the right hon. and learned Gentleman the Member for Chertsey (Sir L. Heald), the former Attorney-General, these associations have their own private courts, with their own procedure and their own decisions, and they are responsible to nobody. Above all, there is involved in all this the rights and the interests of the consumer. One of the things that worries me about modern economic society and modern industry is that I do not think that there is enough insistence on, and enough consideration of, the needs, the interests and the rights of the consumer, either by Government, Parliament or trade associations. There is nobody effective to speak for the consumer as much as there ought to be. He is liable to be neglected.
I think that it was the right hon. and gallant Member for Leicester, South-East (Captain Waterhouse) who said that in all the people who give evidence there was no long list of those who could be held to represent the consumer. There is truth in that. Apart from the organised voluntary consumer, the Co-operative movement, it is a bit doubtful who can represent the consumer. Consequently, another danger of these trade associations exercising these restrictve practices is the danger to the consumer who badly needs champions in these days of highly organised industry.
Even in the special case, which I would venture to mention, of the Co-operative movement, there is the most shocking discrimination on the part of some of these

2049
interests and trade associations. The so-called dividend of the Co-operative movement is not a dividend in the ordinary commercial sense of the term. As hon. Gentlemen know, what happens is that trade is done and the prices charged are much the same as the prices charged in competitive stores. At the end of an appropriate period, the Co-operative store discovers that after all its expenses are paid it has a greater amount of money in receipts than its expenses. It then returns to the consumer at the store—I experience this twice a year myself at the Royal Arsenal Co-operative Society—[HON. MEMBERS: "Oh."]—of course, I expected some sneers and jeers about the Cooperative movement from a few hon. Members opposite. One knows that they would certainly support discrimination against the Co-operative movement.
This repayment to consumers happens periodically, and it is merely a return of a payment which has proved to be higher than was necessary in order to meet the expenses and the cost of purchases by the Society. Because the Co-operative movement charges below the prices which they have fixed for a number of goods, these associations have refused to supply the Co-operative movement with goods within their jurisdiction.
I should like to hear from the Attorney-General what the Government propose to do about this and whether they will make statutory provision to prevent discrimination against this great form of thrift on the part of the people—not only the working class, but members of the middle-class as well. A lot of them, unfortunately, vote Conservative, but hon. Gentlemen opposite had better remember that these people can easily be persuaded to vote against them. Well, I do not know about it being easy—[Laughter.]—but if the Government propose to uphold discrimination against the voluntary Cooperative movement, with its form of thrift, let us know, and we will see that the co-operators know what is the attitude of the Government to the Co-operative movement.
Moreover, there was the point made by my hon. Friend the Member for Reading (Mr. Mikardo) about public tenders to our own local authorities, and, what is more, the damage being done to the export trade, even within the Commonwealth, by tenders at fixed prices
2050
to Commonwealth Governments, and so on. There is no point in the Government denationalising the iron and steel industry on the ground that they wanted to stimulate competition in the industry instead of having what they regarded as a great State monopoly—though it was not a complete monopoly—and then for them to be indifferent—that is if they remain indifferent—to the fact that tenders to local authorities for the supply of steel and for the erection of steel-framed structures are exactly the same. That completely disposes of the whole idea of competitive principles.
The truth is that the Government are in the soup. The Conservative Party is in a difficulty. Hon. Members opposite do not know whether to support free private enterprise or private cartel monopoly and trade association restrictions. To say that all this should go on without effective public action and a declaration of what practices are not permissible and should be prohibited, seems to me to be wrong.
I submit that we cannot continue to hand over this vast field of economic control to private trade associations. It is a matter for Parliament, for Government and for the public interest. To argue otherwise is to argue for social irresponsibility; to be anti-social and, of course, to be anti-Socialist, which is the same thing. All that may be natural for Conservatives, as the custodians of private capitalist interest, but it is not natural for Socialists to take that point of view.
There is a legitimate field for private trade asociations. I should not like it to be thought that there is no case for the existence of trade associations. I think that there is, and that there are valuable functions for them to discharge. For example, there is the exchange of opinions on trade problems, discusions on behalf of industries with Ministers, on public policy and on Government policy, negotiations with labour, and in connection with research, including scientific research. As a matter of fact, when I was Lord President in charge of civil science, I instituted a system of systematic grants to private trade research associations and established co-operation with them and the Government research organisations.
Therefore, it is not a question of there being nothing useful for the trade associations to do, but it is a question that

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it is not their business to take charge of economic planning outside of public supervision. We cannot submit to the doctrine that there should evolve private economic empires discharging functions which are appropriate to public and not to private authority. Yet that is what is happening and what some are advocating, namely, that there should be a toleration and an encouragement of these associations functioning as private economic empires without any public supervision.
I appreciate, of course, that no doubt there are many hon. Members opposite who are associated with these private trade associations and who are probably themselves personally involved in these restrictive economic practices. That is no doubt why the President of the Board of Trade has virtually rejected the majority Report and virtually accepted the minority Report which is ineffective.
Mr. P. Thorneycroft Mr. P. Thorneycroft indicated dissent.
Mr. Morrison: The right hon. Gentleman shakes his head in dissent. I do not know whether he is disposed to accept the majority Report and to reject the minority Report, and whether he would like to say that is so. Or, it may be——
Mr. Thorneycroft: Had the right hon. Gentleman listened, he would have heard what I said.
Mr. Morrison: I did, and the conclusion I reached from listening to what the right hon. Gentleman said was that he had virtually accepted the minority Report which, in view of the nature of the composition of the party behind him, was rather what I expected him to do. I should be pleasantly and very much surprised if, in view of his record and the nature of his party, the right hon. Gentleman were to accept the majority Report of the Royal Commission.
Moreover, the Government are not logical about all these things. They break up so-called monopolies such as the transport organisation, organisations which by no means are all monopolies, but which, however, are responsible in some way to the Government and Parliament. This Government do as little as possible in relation to private economic control and monopolies, while abandoning public supervision of the use of the nation's economic resources.
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The Commission, in its majority Report, is clear in its condemnation of these practices. For example, on page 83 of the Report, in paragraph 237, the Commission says:
"Apart from these considerations, we think that it is generally against the public interest for combinations of traders to be able to exercise the powers over individuals which some price maintenance associations have acquired, and for this to be done through private tritunals whose procedure cannot provide the safeguards which public justice requires. These powers are particularly open to objection when they are used against concerns which are not members of the association or have not entered into any contractual obligation to observe the rules enforced against them."
That is a fairly clear and categorical condemnation of, at any rate, part of the practices of these associations. And in paragraph 240 in the majority Report, the Commission says:
"We have considered whether there may be circumstances in which our conclusion that the practices with which our reference is concerned are generally against the public interest may not hold good. We have not in the course of our inquiry come across any instances in which we were clearly satisfied that such practices were beneficial."
That is fairly clear too. But the Commission does make allowance for the possibility that exceptional considerations may arise. Therefore, it recommends the prohibition of the objectionable practices and a chance for people to be heard to establish their case and for exceptional arrangements to be made.
Therefore, I think that the majority Report of the Commission is in all the circumstances fair and reasonable. Indeed, this is the opinion of the "Economist," which cannot be held to be consistently unfriendly to the party opposite. It says:
"In other words, it is proposed that the way in which some of the most respectable gentlemen in the country (including several Conservative M.P.s) now carry on their businesses should be declared by Parliament to be, in general, contrary to the public interest and illegal, leaving upon the onus of proving (if they can) that they are the virtuous exceptions. The Government in general, and Mr. Thorneycroft in particular, will show great courage if they push this recommendation through."
The courage is wanting and, obviously, the Government are not going to push the recommendation through. Consequently, the President of the Board of Trade has made the unsatisfactory statement today from which it looks as though we are to get registration and that there may be

2053
reference of particular cases to that tribunal.
But that is bound to be slow. My hon. Friend the Member for Reading, in his persuasive speech, entered into his own estimates of time, and he is right. It may take an extraordinary amount of time.
Mr. G. R. Lindgren: It was intended to take a long time.
Mr. Morrison: As my hon. Friend says, it was intended to take a long time. Consider the time that this Report has taken. Of course, it is over a wider field. The Report, incidentally, is able to quote from earlier reports of the Monopolies Commission which condemned similar restrictive practices.
Consequently, it is bound to be handled on the basis of either referring a case at a time to the tribunal or, if possibly half a dozen tribunals are set up—there is a limit to the number that can be set up—we might get half a dozen cases referred at a time. We had the optimism of an hon. Member opposite who spoke a little while ago and who thought that these cases would be settled in two or three days. He need not believe that. There will be considerable argument, especially if legal representatives are to be heard. It is likely that these cases will go for a long time. Literally, it may be twenty, thirty or even forty years before the ground is covered.
It could be so. Let us consider the enormous number of cases which the Commission has already had under consideration, and to which it refers. If these are to be treated fairly and equitably, and the arguments of the parties are to be adequately heard, it is obviously going to take a long time. It will be a substantial period of years before it can be done.
The truth is that many of these restrictive practices are a survival of the miserable years of the 1920s and 1930s, which were produced under Conservative rule after the First World War. [HON. MEMBERS: "Oh."] We all know it; it is a matter of historical fact. I know that hon. Members opposite do not like to be reminded of it. They say, "Do not look at the past; look to the future." I am all in favour of looking to the future, and I only mention, as an historical fact, that they were miserable times—and we know who was politically in control.
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These restrictive practices grew up at that time, when the economics of scarcity were being preached in the world of private enterprise, and were being exercised in the iron and steel industry, with the result that we did not have enough steel when war broke out. We do not want the economics of scarcity; we want the economics of plenty. [HON. MEMBERS: "Hear, hear."] I am very glad that that eminently Socialist sentiment should be cheered by hon. Members opposite. Ever since it began Socialism has been advocating the economics of plenty as against the economics of scarcity. It is Conservative capitalism which is preaching and practising the arts of restriction under these trade associations which are condemned by the Report of the Commission.
The Government are not living up to their own Election manifesto—even allowing for its woolliness and the fact that it is written in language deliberately meant to be explained in more than one way after the Election; though deliberately calculated to lead people to think that it meant something at the time of the Election. This is what the manifesto said—and it is a different sort of language and a different sort of spirit from that which we have heard from the benches opposite today. The manifesto of these champions of trade associations and restrictive practices says:
"We reaffirm our belief in the system of free competitive enterprise."
Today they have been busily telling us that they do not believe anything of the kind. [HON. MEMBERS: "Look behind you."] If hon. Members are referring to my hon. Friend the Member for Cheetham (Mr. H. Lever), let me say how pleasurable it is to see him in his place. I know the facts about my hon. Friend's attendances, and I am very glad to see him here, even if he has said some things with which I do not agree.
The manifesto goes on to say:
"The Monopolies and Restrictive Practices Commission, first suggested and recently strengthened by the Conservatives, has started on the right path. Its recommendations have been acted upon. The Conservative Government has made a new approach by referring for examination crtain practices which cover a wide range of industry."
Hon. Members: Hear, hear.
Mr. Morrison: All right; I shall take the time out of the speech of the Attorney-General.
The manifesto continues:
"This reference is likely to raise many issues ranging from the existence of private trade courts to the right of proprietors of branded goods to fix a uniform price for their products. These are complex questions. Our policy is to obtain an impartial statement of the facts and their effect on the national interest, and then to take the action appropriate in each case."
That was clearly intended to lead those who are opposed to restrictive and monopolistic practices to suppose that the Conservative Party meant business. [HON. MEMBERS: "SO it does."] It does not mean business. The President of the Board of Trade has said either that he is going virtually to accept the minority Report or that he does not know what he is going to do. However, he will get his orders all right, just as the Minister of Fuel and Power got his orders at the beginning of the week——
Mr. William Ross: They ought to be marching orders.
Mr. Morrison: —just as the Minister of Transport and Civil Aviation has had his orders.
The Government's Motion means nothing. It says that the Report can be taken as a basis for consideration by the Government, but the Government ought to have considered it before. It was a live issue in Parliament before the Election. Indeed, they must have considered it to have been able to have included that passage in their Election manifesto from which I have just quoted. The Government have moved a Motion which virtually means nothing at all, and we strongly suspect that the Government mean to take no effective action in this matter. Therefore, we shall press the Amendment to a Division, in the belief that the majority Report of the Commission recommends the best course to take.
9.32 p.m.
The Attorney-General (Sir Reginald Manningham-Buller): Anyone considering the speech of the right hon. Member for Lewisham, South (Mr. H. Morrison) will have found in it very little to justify voting for the Amendment. There were in it only two references to matters in the Report which we are considering, and they were to the references to the Cooperative societies and to the chapter
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headings under which the Commission divided practices. I have some sympathy with the right hon. Gentleman the Member for Huyton (Mr. H. Wilson) in having to follow the President of the Board of Trade. [HON. MEMBERS: "Oh."] Yes, the same sort of sympathy one would have with a barrister who went into court with the wrong brief—an old one, dusty and covered with cobwebs.
The right hon. Member for Lewisham, South surprised me. I was surprised that he had not appreciated what my right hon. Friend said in opening the debate. The right hon. Gentleman suggested that my right hon. Friend had rejected the majority Report and accepted the minority Report. Both statements by the right hon. Gentleman were entirely inaccurate. He has done neither.
Mr. Ross: He has done nothing.
The Attorney-General: The solution which my right hon. Friend put forward accepts part of both Reports, as he himself indicated, and, in my view, it is a better solution than that put forward by either section.
The debate today has centred not on the nature of the practices to which the Commission referred, but on the steps to be taken towards the implementation of its proposals. That has been the main feature of a debate which has ranged widely and which has been most interesting. I join with the right hon. Member for Lewisham, South in what he said about the two excellent maiden speeches which we heard from my hon. Friend the Member for Epsom (Mr. Rawlinson) and the hon. Member for Loughborough (Mr. Cronin).
The right hon. Member for Huyton argued in favour of a general prohibition of the practices to which reference has been made. He said, with an inconsistency that is not without its charm, that general prohibition, of course, should not apply to the calico printers.
Mr. H. Wilson Mr. H. Wilson indicated dissent.
The Attorney-General: Yes, the right hon. Gentleman went on to say that it should not apply because of the circumstances in that trade. I listened to him with the greatest care. He then referred to the tribunal which is contemplated in my right hon. Friend's proposals as a "Heath Robinson" tribunal. I do not

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know why he used that description, but I will have something to say about that shortly.
In trying to wind up the debate for the Government, I propose to distinguish between the particular discriminatory practices to which both sections of the Commission referred and the methods of enforcement, and to deal first with what has been said about the methods of enforcement and what the majority and minority Reports recommend should be clone. It is the case, of course, that the majority and minority went outside their terms of reference, as the majority admitted, in recommending what should be done in implementing their conclusions, but I am sure that the House is glad that they did so, because by doing so they have posed a very real and important problem for our consideration.
As the House knows, the minority Report recommended registration of agreements involving collective discrimination, and registration was recognised by both the minority and majority as a good thing. The majority Report said that it
"… might lead the parties to abandon or modify arrangements that were likely to incur criticism, and to proceed with care when new arrangements were in contemplation."
We have the whole of the Commission considering this matter speaking in favour of registration, although it is true that the majority did not recommend it because they thought they had found something better.
Not only did the Monopolies Commission recommend that, but we are asked in the Amendment which is in the name of the Leader of the Opposition to make arrangements for
"… ensuring the registration of all collective agreements which provide for minimum prices.…"
It is really a little inconsistent of the right hon. Member for Huyton to say, as he did today, that registration will not do anything—a view which was also expressed by the hon. Member for Reading (Mr. Mikardo).
Mr. Mikardo: I am sure that the right hon. and learned Gentleman does not want to misquote me. I said that registration and publication are not enough, which is very different from saying that they are of no use.
The Attorney-General: I agree with the hon. Member about that.
Mr. Mikardo: Then the right hon. and learned Gentleman should not misquote me.
The Attorney-General: I am sorry if I did the hon. Member an injustice.
This is why the proposal which is put forward by my right hon. Friend is not the same as the proposal that is contained in the minority Report, because the minority stop with registration whilst our proposals go a stage further.
Before I proceed to say something about our further proposals, I would emphasise that I think that we are all in agreement that registration is a good thing. The majority of the Commission, of course, did not recommend it, because it would not fit in well with the scheme, which they propounded, of general prohibition. How will it work? Of course, legislation will be required to provide for registration and to make it compulsory. When that provision is made, those who are parties to these discriminatory agreements can be called upon to register them according to their nature, or, it may be, industry by industry. If they do not register them on the due date, then the practice will be illegal and unenforceable. That will be the sanction to secure registration.
As I said a moment ago, it is not intended to stop there. I agree with my right hon. Friend that it would not be sufficient to stop there. Those registered agreements must be examined and the next step, as we see it, must be to bring those which appear bad before some tribunal. That brings me to the next question which has been touched upon in the course of this debate, and on which my right hon. and gallant Friend the Member for Leicester, South-East (Captain Waterhouse) said a great deal, namely, what kind of tribunal should it be.
I have listened with interest to the different views expressed. Personally, I think that a strong case is required for the establishment of a special tribunal for a special purpose. There may be a divergence of opinion as to how the tribunal can best be constituted, but we want to secure a very high-powered and highly qualified tribunal to function on matters of this complexity. We shall give consideration to all that has been said as to the nature of the tribunal.

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It may be possible to deal with these matters in the courts or it may be outside the courts, I cannot say; and I am sure that the House would not expect me to say more now about the constitution of the tribunal.
Mr. H. Wilson: Will the right hon. and learned Gentleman kindly tell the House, now that he is giving us a little more information, what difference, if any, is there between this proposal for a high-powered, impartial tribunal to look at the case after registration and what the House agreed to seven years ago when it set up the Monopolies Commission for individual cases?
The Attorney-General: If the right hon. Gentleman will allow me I will deal with that if I have time. [HON. MEMBERS: "Do it now."] Certainly, I am trying to deal with it. I appreciate the point. It is important, but I am dealing first with the nature of the tribunal.
The next point which comes in its logical order is the question of what guidance should be given to that tribunal. The hon. and learned Gentleman the Member for Northampton (Mr. Paget) says that the issues would not be justiciable. That will depend, to a large degree, on the guidance given to the tribunal. It is, as my right hon. Friend said previously, desirable to lay down criteria. Having regard to the nature of the problem, that will not be an easy task, but it will have to be done if it can be done.
They will have to be carefully formulated because practices vary from industry to industry. Although they are divided by the majority Report into six distinct categories, as the Report pointed out, the practices are often inter-mixed and their effect varies very considerably from industry to industry, with some more harmful than others. It is a difficult problem and one we shall tackle with the intention of solving it.
I follow on to what is the next stage of this system. What is to be the result of the decision of the tribunal? It must be that if the tribunal decides against the industry or against those claiming to be allowed to continue the practice the continuance of this practice should be illegal and unenforceable. The burden of making out their case will be on those
2060
claiming to be allowed to continue it. The tribunal may permit the practice while condemning the methods of enforcement. As to the methods of enforcement, it may well be possible in our legislation to be fairly positive and definite.
Most people do not like a person who is not a member of an association, who has not voluntarily bound himself to certain terms and conditions, being stopped from earning his livelihood in the trade or industry of his choice by those engaged in that trade or industry; or being prevented by those with whom he desires to compete from entering a particular industry.
Nor, as is clear from what has been said in the House today, are private courts liked. It is only fair to say that these private courts which have been constituted can be looked upon as preferable to the ejection of a man from a trade by the operation of an association without any kind of impartial investigation. I know that in some cases steps have been taken to make these private courts as good as they can be, but the idea of private courts is repugnant. It is wrong that they should be able to inflict fines and penalties, particularly on persons who do not belong to their association.
On the other hand, it is no use, if a practice such as individual resale price maintenance is held to be a good practice, abolishing all the methods by which it can be enforced. The right hon. Gentleman the Member for Huyton has one view on individual resale price maintenance, the T.U.C. has expressed another. The majority Report does not indicate any way in which individual resale price maintenance can be effectively enforced if it is a good thing to have. That is one real problem which we have to tackle. We shall give, and indeed are giving, earnest consideration to methods of enforcement.
If we can find methods of enforcement which are effective without collective boycott and private courts, then, of course, it would follow that it would be possible to prohibit such methods, maybe by adopting some of the "non-signer" arrangements which are current in other countries. It means, however, that if one of the practices is desirable and ways have to be found of maintaining it, then if we cannot find any alternative method

2061
of enforcement—and I very much hope that one can be found—as the next best thing we must secure adequate supervision and control over the exercise of these sanctions.
Mr. Paget: Before the right hon. and learned Gentleman leaves that point, as I understand he has said that the effect of an adverse finding by the tribunal would be that the practice was illegal but not criminal——
The Attorney-General: Not criminal.
Mr. Paget: —the only effect of that is that the practice cannot be enforced in the courts. However, as the point of these practices is to enforce them out of the courts, the effect of a tribunal, as I understand, would be not at all.
The Attorney-General: I think that the hon. and learned Gentleman has misunderstood me. When I say "illegal" I mean that there will be some way of stopping those who partake of these forbidden practices from carrying them on.
Mr. Paget: But they are not criminal.
The Attorney-General: By injunction. Surely the hon. and learned Gentleman will admit that this can be a very effective remedy. I was just going to say that there was one thing on which I agree with the hon. and learned Gentleman in what he said today——
Mr. Ellis Smith: Only one?
The Attorney-General: He said we want to look at these things carefully. For once I find myself also in agreement with the "Economist," when it said:
"The need is not for a showy charge which, like Rupert at Edge Hill, will break through part of the line and leave it to form up again behind, but for a careful, sustained and penetrating advance, widening out as it progresses."
I believe that the policy outlined by my right hon. Friend will satisfy those requirements.
Let me say, quite shortly, why I think that it will work in that way. Criticism has been advanced by the majority Report of the Commission of the case-by-case approach on the grounds that it is cumbersome, slow and unfair. This is a variant of that. First, a section will be required to register. One will pick out, presumably, the section where it is thought that the practices are worse.
2062
Directly they are registered, the appointment is made for bringing the worst ones before the tribunal. The tribunal's function will be different, as I see it, from that of the Monopoly Commission now set up. Before the tribunal the burden will rest on the industry claiming to be allowed to carry on these practices. The Monopolies Commission has to find out all the facts covering the whole range of the industry. Here, these agreements will be registered and will be available before the tribunal.
Personally, I would say that whether we accept the majority Report or the Minority Report, we still have to have a tribunal of this character. In my view, our proposals should act more speedily than the proposals contained in the majority Report. I think that the building up of case law by the tribunal will lead to a lot of firms and parties altering their agreements in the light of those decisions and may lead to many people not seeking to justify them.
May I turn to the majority Report as to implementation. The Report recommends, in paragraph 246, that there should be a general prohibition. It recognises that there will be a need for exemption. Towards the end of that paragraph it will be seen that it contemplates that the exemptions will be decided upon before the general prohibition is brought into effect. So, for each of these exemptions, it will be necessary to have a tribunal and an inquiry which may take just as long—one does not know—but if it has to cover the whole field of those who are claiming exemption it means that general prohibition will not take effect for many years to come.
Indeed, the majority Report seems to contemplate that difficulty because it goes on to suggest that there should be an interim procedure for making exceptions as well. As my right hon. and learned Friend the Member for Chertsey (Sir L. Heald) said, that really is a novel and astonishing proposition. Adoption of the majority Report will, I believe, mean that it will take quite as long as, and possibly longer than, under the scheme put forward by my right hon. Friend.
In that part of the majority Report, it is said that all we need do if we accept its recommendations is to establish a

2063
prima facie case. That looks very nice when one first glances at it. I do not know how one can establish a prima facie case without that case being heard. If it is to be heard, then we are back again with a tribunal. It is all very well for the hon. Member for Reading to try to deride this procedure which we are putting forward, but I believe, for the reasons which I have given, that it is a fair and proper procedure and will be generally welcomed throughout the country as a fair method of dealing with a very difficult problem. It is a procedure which, I believe, will be thoroughly effective in stopping practices which should be stopped and, in particular, in stopping methods of enforcement which certainly ought to be prohibited.
Mr. Mikardo: Will the right hon. and learned Gentleman go further and answer my direct question? Will he say in which year he thinks the first effective action will be taken under the President's proposal. Will it be earlier than 1959?
The Attorney-General: It will depend to a large degree on the amount of collaboration and assistance given to us by the hon. Gentleman.
In conclusion, I would say—I am sure we should all agree—that this has been a very valuable and interesting debate.
Mr. Ellis Smith: Not very valuable.
The Attorney-General: I ask the House to accept the Motion, which expresses the correct view of the Report, and to reject the Amendment.
9.57 p.m.
Mr. Ellis Smith: As one who has been a member of no other political party, and as one who was born of the working class and regard with pride the opportunity of serving my people and my country, I look upon this assembly as a democratic one, where those elected should have an opportunity of speaking on behalf of the people. We live in a great country, made great not by "that lot" opposite but by the people of the country. In past years we have seen in France those who were prepared to sell their country. Here, those who support the continuation of monopolies, restrictions and trade associations are the people who would sell our country.
A great deal is said about the need to reduce the costs of production. There are trade associations which are strangling our productive industry, and in manufacturing industry management and organised workpeople of all grades are agreed that their hands are tied behind their backs before they start because of trade associations built up and supported by many right hon. and hon. Members opposite——
The Parliamentary Secretary to the Treasury (Mr. P. G. T. Buchan-Hepburn)The Parliamentary Secretary to the Treasury (Mr. P. G. T. Buchan-Hepburn) rose in his place and claimed to move, That the Question be now put.
Question put accordingly. That the words proposed to be left out stand part of the Question—
The House divided: Ayes 316, Noes 255.

Division No. 24.]

AYES

[9.59 p.m.

Agnew, Cmdr. P. G.

Bevins, J. R. (Toxteth)

Cary, Sir Robert

Aitken, W. T.

Bidgood, J. C.

Channon, H.

Allan, R. A. (Paddington, S.)

Biggs-Davison, J. A.

Chichester-Clark, R.

Alport, C. J. M.

Birch, Rt. Hon. Nigel

Churchill, Rt. Hon. Sir Winston

Amery, Julian (Preston, N.)

Bishop, F. P.

Clarke, Brig. Terence (Portsmth, W.)

Amory, Rt. Hn. Heathcoat (Tiverton)

Black, C. W.

Cole, Norman

Anstruther-Gray, Major W. J.

Body, R. F.

Conant, Maj. Sir Roger

Arbuthnot, John

Boothby, Sir Robert

Cooper, Sqn. Ldr. Albert

Ashton, H.

Bossom, Sir A. C.

Cooper-Key, E. M.

Astor, Hon. J. J.

Boyd-Carpener, Rt. Hon. J. A.

Cordeaux, Lt.-Col. J. K.

Atkins, H. E.

Boyle, Sir Edward

Corfield, Capt. F. V.

Baldock, Lt.-Cmdr, J. M.

Braine, B. R.

Craddock, Beresford (Spelthorne)

Baldwin, A. E.

Braithwaite, Sir Albert (Harrow, W.)

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

Balniel, Lord

Bromley-Davenport, Lt.-Col. W. H.

Crosthwaite-Eyre, Col. O. E.

Banks, Col. C.

Brooke, Rt. Hon. Henry

Crouch, R. F.

Barber, Anthony

Brooman-White R. C.

Crowder, Sir John (Finchley)

Barlow, Sir John

Browne, J. Nixon (Craigton)

Crowder, Petre (Ruislip-Northwood)

Barter, John

Bryan, P.

Cunningham, S. K.

Baxter, Sir Beverley

Bullus, Wing Commander E. E.

Currie, G. B. H.

Beamish, Maj. Tufton

Burden, F. F. A.

Dance, J. C. G.

Bell, Philip (Bolton, E.)

Butcher, Sir Herbert

Davidson, Viscountess

Bell, Ronald (Bucks, S.)

Campbell, Sir David

D'Avigdor-Goldsmid, Sir Henry

Bennett, Dr. Reginald

Carr, Robert

Deedes, W. F.

Digby, S. Wingfield

Joynson-Hicks, Hon. L. W.

Price, Henry (Lewisham, W.)

Dodds-Parker, A. D.

Kaberry, D.

Prior-Palmer, Brig. O. L.

Donaldson, Cmdr. C. E. McA.

Keegan, D.

Profumo, J. D.

Doughty, C. J. A.

Kerby, Capt. H. B.

Ralkes, Sir Victor

Drayson, G. B.

Kerr, H. W.

Ramsden, J. E.

Dugdale, Rt. Hn. Sir T. (Richmond)

Kershaw, J. A.

Rawlinson, P. A. G.

Duncan, Capt. J. A. L.

Kirk, P. M.

Redmayne, M.

Eccles, Rt. Hon. Sir D. M.

Lagden, G. W.

Rees-Davies, W. R.

Eden, Rt. Hn. Sir A. (Warwick & L'm'tn)

Lambton, Viscount

Remnant, Hon. P.

Eden, J. B. (Bournemouth, West)

Lancaster, Col. C. G.

Renton, D. L. M.

Elliot, Rt. Hon. W. E.

Langford-Holt, J. A.

Ridsdale, J. E.

Emmet, Hon. Mrs. Evelyn

Leavey, J. A.

Rippon, A. G. F.

Errington, Sir Eric

Leburn, W. G.

Roberts, Peter (Heeley)

Erroll, F. J.

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

Robertson, Sir David

Farey-Jones, F. W.

Legh, Hon. Peter (Petersfield)

Robinson, Sir Roland (Blackpool, S.)

Fell, A.

Lennox-Boyd, Rt. Hon. A. T.

Robson-Brown, W.

Finlay, Graeme

Lindsay, Hon. James (Devon, N.)

Rodgers, John (Sevenoaks)

Fleetwood-Hesketh, R. F,

Lindsay, Martin (Solihull)

Roper, Sir Harold

Fletcher-Cooke, C.

Linstead, Sir H. N.

Ropner, Col. Sir Leonard

Fort, R.

Llewellyn, D, T.

Sandys, Rt. Hon. D.

Foster, John

Lloyd, Rt. Hon. G. (Sutton Coldfield)

Schofield, Lt.-Col. W.

Fraser, Hon. Hugh (Stone)

Lloyd, Maj. Sir Guy (Renfrew, E.)

Scott-Miller, Cmdr. R,

Fraser, Sir Ian (M'cmbe & Lonsdale)

Lloyd, Rt. Hon. Selwyn (Wirral)

Sharples, Maj. R. C.

Freeth, D. K.

Lloyd-George, Maj. Rt. Hon. G.

Shepherd, William

Galbraith, Hon. T. G. D.

Longden, Gilbert

Simon, J. E. S. (Middesbrough, W.)

Gammans, L. D.

Low, Rt. Hon. A. R. W.

Smithers, Peter (Winchester)

Garner-Evans, E. H.

Lucas, Sir Jocelyn (Portsmouth, S.)

Smyth, Brig. J. G. (Norwood)

Glover, D.

Lucas, P. B. (Brentford & Chiswick)

Soames, Capt. C.

Godber, J. B.

Lucas-Tooth, Sir Hugh

Spearman, A. C. M.

Comme-Duncan, Col. A.

Macdonald, Sir Peter

Speir, R. M.

Gough, C. F. H.

Mackeson, Brig. Sir Harry

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

Gower, H. R.

Mackie, J. H. (Galloway)

Spens, Rt. Hn. Sir P. (Kens'gt'n, S)

Graham, Sir Fergus

McLaughlin, Mrs. P.

Stanley, Capt. Hon. Richard

Grant, W. (Woodside)

Maclean, Fitzroy (Lancaster)

Stevens, Geoffrey

Grant-Ferris, Wg. Cdr. R. (Nantwich)

McLean, Neil (Inverness)

Steward, Harold (Stockport, S.)

Green, A.

Macleod, Rt. Hn. Iain (Enfield, W.)

Steward, Sir William (Woolwich, W.)

Gresham Cooke, R.

MacLeod, John (Ross & Cromarty)

Stewart, Henderson (Fife, E.)

Grimston, Hon. John (St. Albans)

Macmillan, Maurice (Halifax)

Stoddart-Scott, Col. M.

Grimston, Sir Robert (Westbury)

Macpherson, Niall (Dumfries)

Storey, S.

Gurden, Harold

Maddan, Martin

Stuart, Rt. Hon. James (Moray)

Hall, John (Wycombe)

Maitland, Cdr. J. F. W. (Horncastle)

Summers, G. S. (Aylesbury)

Hare, Hon. J. H.

Maitland, Hon. Patrick (Lanark)

Sumner, W. D. M. (Orpington)

Harris, Frederic (Croydon, N. W.)

Manningham-Buller, Rt. Hn. Sir R.

Taylor, Sir Charles (Eastbourne)

Harris, Reader (Heston)

Markham, Major Sir Frank

Taylor, William (Bradford, N.)

Harrison, A. B. C. (Maldon)

Marlowe, A. A. H.

Teeling, W.

Harrison, Col. J. H. (Eye)

Marples, A. E,

Thomas, Rt. Hn. J. P. L. (Hereford)

Harvey, Air Cdre. A. V. (Macclesfd)

Marshall, Douglas

Thomas, Leslie (Canterbury)

Harvey, Ian (Harrow, E.)

Mathew, R.

Thomas, P. J. M. (Conway)

Harvey, John (Walthamstow, E.)

Maude, Angus

Thompson, Kenneth (Walton)

Harvie-Watt, Sir George

Maudling, Rt. Hon. R.

Thompson, Lt.-Cdr. R. (Croydon, S.)

Hay, John

Mawby, R. L.

Thorneycroft, Rt. Hon. P.

Head, Rt. Hon. A. H.

Maydon, Lt.-Comdr. S. L. C.

Thornton-Kemsley, C. N.

Heald, Rt. Hon. Sir Lionel

Medlicott, Sir Frank

Tiley, A. (Bradford, W.)

Heath, Edward

Molson, A. H. E,

Tilney, John (Wavertree)

Henderson, John (Cathcart)

Monckton, Rt. Hon. Sir Walter

Touche, Sir Gordon

Hill, Rt. Hon. Charles (Luton)

Moore, Sir Thomas

Turner, H. F. L.

Hill, Mrs. E. (Wythenshawe)

Morrison, John (Salisbury)

Turton, Rt. Hon. R. H.

Hill, John (S. Norfolk)

Nabarro, G. D. N.

Vane, W. M. F.

Hirst, Geoffrey

Nairn, D. L. S.

Vaughan-Morgan, J. K.

Hope, Lord John

Neave, Airey

Vickers, Miss J. H.

Hopkinson, Rt. Hon. Henry

Nicholls, Harmar

Vosper, D. F.

Hornsby-Smith, Miss M. P.

Nicholson, Godfrey (Farnham)

Wakefield, Edward (Derbyshire, W.)

Horobin, Sir Ian

Nicolson, N. (B'n'm'th, E. & Ch'ch)

Wakefield, Sir Wavell (St. M'lebone)

Horsbrugh, Rt. Hon. Dame Florence

Nield, Basil (Chester)

Walker-Smith, D. C.

Noble, Comdr. A. H. P.

Wall, Major Patrick

Howard, Gerald (Cambridgeshire)

Nugent, G. R. H.

Ward, Hon. George (Worcester)

Howard, Hon. Greville (St. Ives)

Nutting, Rt. Hon. Anthony

Ward, Miss I. (Tynemouth)

Howard, John (Test)

Oakshott, H. D.

Waterhouse, Capt. Rt. Hon. C.

Hudson, Sir Austin (Lewisham, N.)

Ormsby-Gore, Hon. W. D.

Watkinson, H. A.

Hudson, W. R. A. (Hull, N.)

Orr, Capt. L. P. S.

Webbe, Sir H.

Hughes, Hallett, Vice-Admiral J.

Orr-Ewing, Charles Ian (Hendon, N.)

Whitelaw, W. S. I. (Penrith & Border)

Hughes-Young, M. H. C.

Orr-Ewing, Sir Ian (Weston-S-Mare)

Williams, Rt. Hon. Charles (Torquay)

Hulbert, Sir Norman

Osborne, C.

Williams, Gerald (Tonbridge)

Hurd, A. R.

Page, R. G.

Williams, Paul (Sunderland, S.)

Hutchison, Sir Ian Clark (E'b'gh, W.)

Pannell, N. A. (Kirkdale)

Williams, R. Dudley (Exeter)

Hyde, Montgomery

Peake, Rt. Hon. O.

Wills, G. (Bridgwater)

Iremonger, T. L.

Peyton, J. W. W.

Wilson, Geoffrey (Truro)

Irvine, Bryant Godman (Rye)

Pickthorn, K. W. M.

Wood, Hon. R.

Jenkins, Robert (Dulwich)

Pilkington, Capt. R. A.

Woollam, John Victor

Jennings, J. C. (Burton)

Pitman, I. J.

Yates, William (The Wrekin)

Johnson, Dr. Donald (Carlisle)

Pitt, Miss E. M.

Johnson, Eric (Blackley)

Pott, H. P.

TELLERS FOR THE AYES:

Johnson, Howard (Kemptown)

Powell, J. Enoch

Mr. Buchan-Hepburn and

Jones, A. (Hall Green)

Price, David (Eastleigh)

Mr. Studholme.

2066

2067

NOES

Ainsley, J. W.

Griffiths, David (Rother Valley)

Neal, Harold (Bolsover)

Albu, A. H.

Griffiths, Rt. Hon. James (Llanelly)

Noel-Baker, Francis (Swindon)

Allaun, F. (Salford, E.)

Griffiths, William (Exchange)

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

Anderson, Frank

Grimond, J.

O'Brien, T.

Attlee, Rt. Hon. C. R.

Hale, Leslie

Oliver, G. H.

Awbery, S. S.

Hall, Rt. Hn. Glenvil (Colne Valley)

Oram, A. E.

Bacon, Miss Alice

Hall, John T. (Gateshead, W.)

Orbach, M.

Baird, J.

Hamilton, W. W.

Oswald, T.

Balfour, A.

Hannan, W.

Owen, W. J.

Bartley, P.

Hastings, S.

Padley, W. E.

Bellenger, Rt. Hon. F. J.

Hayman, F. H.

Paget, R. T.

Bence, C. R. (Dunbartonshire, E.)

Healey, Denis

Paling, Rt. Hon. W. (Dearne Valley)

Benn, Hn. Wedgwood (Bristol, S. E.)

Henderson, Rt. Hn. A. (Rwly Regis)

Paling, Will T. (Dewsbury)

Benson, G.

Herbison, Miss M.

Palmer, A. M. F.

Bevan, Rt. Hon. A. (Ebbw Vale)

Hewitson, Capt. M.

Pannell, Charles (Leeds, W.)

Blackburn, F.

Hobson, C. R.

Pargiter, G. A.

Blenkinsop, A.

Holman, P.

Parker, J.

Blyton, W. R.

Holmes, Horace

Parkin, B. T.

Boardman, H.

Holt, A. F.

Paton, J.

Bottomley, Rt. Hon. A. G.

Houghton, Douglas

Peart, T. F.

Bowden, H. W. (Leicester, S. W.)

Howell, Charles (Perry Barr)

Price, J. T. (Westhoughton)

Bowles, F. G.

Howell, Denis (All Saints)

Price, Philips (Gloucestershire, W.)

Boyd, T. C.

Hoy, J. H.

Probert, A. R.

Braddock, Mrs, Elizabeth

Hubbard, T. F.

Proctor, W. T.

Brockway, A. F.

Hughes, Cledwyn (Anglesey)

Pryde, D. J.

Broughton, Dr. A. D. D.

Hughes, Emrys (S. Ayrshire)

Pursey, Cmdr. H.

Brown, Rt. Hon. George (Belper)

Hughes, Hector (Aberdeen, N.)

Rankin, John

Brown, Thomas (Ince)

Hunter, A. E.

Reid, William

Burke, W. A.

Hynd, H. (Accrington)

Rhodes, H.

Burton, Miss F. E.

Hynd, J. B. (Attercliffe)

Robens, Rt. Hon. A.

Butler, Herbert (Hackney, C.)

Irvine, A. J. (Edge Hill)

Roberts, Albert (Normanton)

Butler, Mrs. Joyce (Wood Green)

Irving, S. (Dartford)

Roberts, Goronwy (Caernarvon)

Callaghan, L. J.

Isaacs, Rt. Hon. G. A.

Rogers, George (Kensington, N.)

Carmichael, J.

Janner, B.

Ross, William

Champion, A. J.

Jay, Rt, Hon. D. P. T.

Royle, C.

Chapman, W. D.

Jeger, George (Goole)

Shinwell, Rt. Hon. E.

Clunie, J.

Jeger, Mrs. Lena (Holbn & St. Pncs, S.)

Short, E. W.

Coldrick, W.

Jenkins, Roy (Stechford)

Silverman, Julius (Aston)

Collick, P. H. (Birkenhead)

Johnson, James (Rugby)

Silverman, Sydney (Nelson)

Collins, V. J. (Shoreditch & Finsbury)

Jones, Rt. Hon. A. Creech (Wakefield)

Simmons, C. J. (Brierley Hill)

Corbet, Mrs. Freda

Jones, David (The Hartlepools)

Skeffington, A. M.

Cove, W. G.

Jones, Elwyn (W. Ham, S.)

Slater, Mrs. H. (Stoke, N.)

Craddock, George (Bradford, S.)

Jones, Jack (Rotherham)

Slater, J. (Sedgefield)

Cronin, J. D.

Jones, J. Idwal (Wrexham)

Smith, Ellis (Stoke, S.)

Crossman, R. H. S.

Jones, T. W. (Merioneth)

Snow, J. W.

Cullen, Mrs. A,

Kenyon, C.

Sorensen, R. W.

Daines, P.

Key, Rt. Hon. C. W.

Sparks, J. A.

Dalton, Rt. Hon. H.

King, Dr. H. M.

Steele, T.

Darling, George (Hillsborough)

Lawson, G. M.

Stewart, Michael (Fulham)

Davies, Rt. Hon. Clement (Montgomery)

Ledger, R. J.

Stokes, Rt. Hon. R. R. (Ipswich)

Davies, Ernest (Enfield, E.)

Lee, Frederick (Newton)

Stones, W. (Consett)

Davies, Harold (Leek)

Lee, Miss Jennie (Cannock)

Strachey, Rt. Hon. J.

Davies, Stephen (Merthyr)

Lever, Harold (Cheetham)

Strauss, Rt. Hon. George (Vauxhall)

Deer, G.

Lever, Leslie (Ardwick)

Stross, Dr. Barnett (Stoke-on-Trent, C.)

Delargy, H. J.

Lindgren, G. S.

Summerskill, Rt. Hon. E.

Dodds, N. N.

Lipton, Lt.-Col. M.

Swingler, S. T.

Donnelly, D. L.

Logan, D. G.

Sylvester, G. O.

Dugdale, Rt. Hn. John (W. Brmwch)

MacColl, J. E.

Taylor, Bernard (Mansfield)

Dye, S.

McInnes, J.

Taylor, John (West Lothian)

Ede, Rt. Hon. J. C.

McKay, John (Wallsend)

Thomas, Iorwerth (Rhondda, W.)

Edelman, M.

McLeavy, F.

Thomson, George (Dundee, E.)

Edwards, Rt. Hon. John (Brighouse)

McNeil, Rt. Hon. H.

Timmons, J.

Edwards, Rt. Hon. Ness (Caerphilly)

MacPherson, Malcolm (Stirling)

Tomney, F.

Edwards, Robert (Bilston)

Mahon, S.

Turner-Samuels, M.

Edwards, W. J. (Stepney)

Mallalieu, E. L. (Brigg)

Ungoed-Thomas, Sir Lynn

Evans, Albert (Islington, S.W.)

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

Usborne, H. C.

Evans, Edward (Lowestoft)

Mann, Mrs. Jean

Viant, S. P.

Evans, Stanley (Wednesbury)

Marquand, Rt. Hon. H. A.

Wade, D, W.

Fernyhough, E,

Mason, Roy

Warbey, W. N.

Flenburgh, W.

Mayhew, C. P.

Watkins, T. E.

Finch, H. J.

Mellish, R. J,

Weitzman, D.

Fletcher, Eric

Mikardo, Ian

Wells, Percy (Faversham)

Forman, J. C.

Mitchison, G. R-

Wells, William (Walsall, N.)

Fraser, Thomas (Hamilton)

Monslow, W.

West, D. G.

Freeman, Peter

Moody, A. S.

Wheeldon, W. E.

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

Morris, Percy (Swansea, W.)

White, Mrs. Eirene (E. Flint)

Gibson, C. W.

Morrison, Rt. Hn. Herbert (Lewi'm, S.)

White, Henry (Derbyshire, N. E.)

Gooch E. G.

Mort, D. L.

Wigg, George

Greenwood, Anthony

Moss, R.

Wilcock, Group Capt. C. A. B.

Grenfell, Rt. Hon. D. R.

Moyle, A.

Wilkins, W. A.

Grey, C. F.

Mulley, F. W.

Willey, Frederick

2068

2069

Williams, David (Neath)

Williams, W. T. (Barons Court)

Yates, V. (Lady wood)

Williams, Rev. Llywelyn (Abertillery)

Willis, E. G. (Edinburgh, E.)

Zilliacus, K.

Williams, Ronald (Wigan)

Wilson, Rt. Hon. Harold (Huyton)

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

Winterbottom, Richard

TELLERS FOR THE NOES:

Williams, W. R. (Openshaw)

Woodburn, Rt. Hon. A.

Mr. Popplewell and Mr. Pearson.

Resolution agreed to.

Resolved,
That this House welcomes the Report of the Monopolies Commission on Collective Discrimination as a basis upon which Her Majesty's Government can formulate its proposals.

ELECTIONS
Select Committee revived:
Instruction to the Committee that they do consider whether the Election of Mr. Holland-Martin as a Member of this House for Ludlow is invalid on the ground that at the time of his election he was a local director of the Bank of New Zealand.—[The Attorney-General.]

ORDERS OF THE DAY

  FOOD AND DRUGS (SCOTLAND) [MONEY]
  Resolution reported,
  That, for the purposes of any Act of the present Session to amend and consolidate certain enactments in Scotland relating to food and drugs, and for purposes connected therewith, it is expedient to authorise the payment out of moneys provided by Parliament of any expenses incurred by any Minister of the Crown or Government Department in consequence of the provisions of the said Act of the present Session.

BATTERY RAIL-CARS, SCOTLAND
Motion made, and Question proposed, That this House do now adjourn.—[Colonel J. H. Harrison.]
10.12 p.m.
Sir Robert Boothby: I rise on this occasion to deal with a somewhat narrow aspect of the problem of monopolies which we have just been discussing, because this railcar business to which I propose to refer appertains to another monopoly—namely the Transport Commission. What I have to say can be said very briefly, and I hope that several of my hon. Friends who are interested in this problem will
2070
have an opportunity of putting their arguments as well.
I am not greatly concerned about whether on these branch lines we should try out battery rail-cars or diesel railcars. That seems to me a proper subject for experiment. My complaint is that the Transport Commission has done nothing effective on these branch lines about either; and that we are miles behind the continent of Europe in this aspect of railway transport—and, indeed, in railway transport generally. It would be generally accepted, I think, that having had in this country the best railway transport system in Europe—and perhaps in the world—now we probably have the worst, or one of the worst; at any rate, not one which can compare with the railway system either of France or of Germany.
I wish to suggest to the Parliamentary Secretary, first, that he should give serious examination, with the Transport Commission, to the E.T.A. 176 rail-car, which was produced in Germany in 1952. It is a battery rail-car which has had quite an astonishing success, for which substantial orders have now been placed in Germany, which operates at a low cost, and which has been particularly successful on what are known as the secondary or branch lines.
My hon. Friend the Parliamentary Secretary probably knows that my main motive in raising this issue on the Adjournment arises from the fact that a branch line in my own constituency, running from Aberdeen to Macduff through Turriff, one of the great agricultural districts of this country, is still open for goods traffic—so that the signals and all the rest of the maintenance services are kept going—but is completely closed to passenger traffic. That is a monstrous and utterly unjustifiable thing.
It might be arguable that the line should be closed altogether; but to keep it open with all the ancillaries and the labour necessary for the occasional passage of a goods train, and to shut it completely for passenger traffic is an outrage, and I have no hesitation in describing it in these terms. I have seen

2071
quite a lot of the railways of France and Germany during the past four or five years, and it is really a shaming experience to see these little diesel or battery cars running about the branch lines like trams, stopping at all the stations. and with the permanent way available to enable them to make money.
I say categorically that the British Transport Commission has never even attempted to try this thing out at all. It has just ignored the branch lines which run through many of our best agricultural districts, and also the interests of the people who live thereon. It has said that such a system will not work and that it is not economical, but it has not been tried out.
I am asking tonight that an unbiassed investigation shall be made by the British Transport Commission into the possibility of running diesel or battery rail-cars on the branch lines in some of our rural districts, and that such investigation shall include practical experiments which have never yet taken place. I am quite sure that, whatever may be my hon. Friend's answer tonight, this House will not be satisfied until this happens.
10.18 p.m.
Mr. Rupert Speir: I am very glad indeed to have a few minutes in which to support my hon. Friend the Member for Aberdeenshire, East (Sir R. Boothby), because the conditions which exist in North-East Scotland are very similar to those which exist in part of the North-East of England. There, too, we have branch lines which are only employed for the running of goods trains. What is worse, there is no adequate service of buses to take the place of the passenger trains which have been withdrawn, although that was promised when the British Transport Commission was given permission to withdraw the passenger trains.
I think that in the Seventh Report of the British Transport Commission, which was debated the other day, it is clearly shown that the rural areas have been treated extremely shabbily, as I thought they were also so treated in the debate on Transport last Monday.
Mr. Ernest Popplewell (Newcastle-upon-Tyne, West): Will not the hon. Gentleman agree that each time that there
2072
has been a withdrawal of services, the matter has been fully discussed by the consultative committee in each of the areas, when it had the opportunity to present its case?
Mr. Speir: The undertakings which were given that adequate alternative bus services would be provided have not been honoured. The fact is that the British Transport Commission is treating the branch lines, and the rural areas of the country, as poor relations. Just because they do not pay, these lines are being cut down and removed one by one. It is about time that the Commission appreciated that this is an essential service, for unless the rural areas get some transport facilities the urban areas will not get their food.
I entirely agree with my hon. Friend when he says that it is time that more imagination was used by the British Transport Commission, that more experiments were made and that the Commission tried to provide some kind of service. We do not want the kind of service of which the Commission publishes photographs on page 11 of its Report, the service which it calls "light-weight diesel units" and costing £14,000 a unit. They are utterly useless in the rural areas. We want very light-weight units. Many of these branch lines could be turned into light railways. We should have unattended halts, and costs could be cut down in many different ways.
The fact is that the Commission would have a stronger case, and would have much more public sympathy in closing down branch lines, if it made some attempt to make some of them pay. It have not practised what has been practised successfully on the Continent, which is to have light rail-cars running as trams or buses.
The drift from the land is continuing at a rapid rate, and it is my belief that this drift is taking place because of the lack of adequate transport facilities in rural areas. Unless we have better transport facilities the situation will deteriorate still further, and there will be a lowering of agricultural production. I warn the Parliamentary Secretary that the situation is getting worse, and that it is time that we had an inter-Departmental committee to consider the whole problem of rural transport.
10.20 p.m.
Mr. Ernest Popplewell (Newcastle-upon-Tyne, West): It was not my intention to intervene in this debate, but the coat that is being trailed and the gross distortion of the facts by hon. Members opposite compel me to intervene.
Mr. Speir: What distortion has taken place?
Mr. Popplewell: The gross distortion of the facts that is taking place compels me—with some knowledge of the subject—to intervene.
When a branch line is closed down the fullest possible inquiry is conducted by the Transport Users' Consultative Committee. [HON. MEMBERS: "Useless."] Hon. Members opposite do not like it, but it is the fact. They should not drag red herrings across the Floor. The fullest possible inquiry takes place, at which members of the public have the right to put up a case to the Committee. This Committee is not a sub-committee of the British Transport Commission; it is an entirely independent body. Before it agrees to any closing of a branch line, the most searching inquiry is conducted by it.
Sir R. Boothby: Rubbish.
Mr. Popplewell: It is not rubbish. The hon. Member had far better keep his remarks to the subject of fish, about which he may profess to know. He does not understand this matter.
Mr. Speir: This has all taken place since nationalisation.
Mr. Popplewell: Let us go into the facts of the case. The Transport Users' Consultative Committee requests the British Transport Commission—[Interruption.] Hon. Members opposite should show better manners. They should try to act reasonably like gentlemen. The essence of the case is that the Commission has to produce its books and show the number of people using the branch line in question. The Committee takes a careful census of the people who have used the line for a considerable time, and if the public are not supporting it it is closed down. Is there any other industry in the private sector which runs an undertaking at a loss?
Mr. Speir: Yes—the banks.
Mr. Popplewell: The hon. Member knows that there is not one. The Transport Users' Consultative Committee provided the first opportunity for the public to present its case. [Interruption.] It is no use the hon. Member for Hexham (Mr. Speir) saying "Nonsense". That just indicates that he does not understand the matter.
Mr. Speir: I did not say "Nonsense." I said that under the previous system it was not necessary.
Mr. Popplewell: Prior to the introduction of nationalisation the public never had the opportunity to protest. If adequate bus services are not provided where branch lines are closed, it is because hon. Members opposite passed the denationalisation Act of 1953, which has prevented the Commission giving the service it otherwise would have done.
Mr. Geoffrey Wilson: Nonsense. Not in Scotland.
Mr. Popplewell: Hon. Members opposite can shout and howl, but that does not make the case any better. These are the facts of what is happening.
Sir R. Boothby: Is the hon. Member maintaining that the people in these rural districts are satisfied and pleased that the branch lines are being closed?
Mr. Popplewell: The only thing I can suggest is that when a branch line is closed there is a tremendous howl.
Sir R. Boothby: Quite right.
Mr. Popplewell: Why have the people not used the line? Their branch lines are there, and if there is no alternative service the Transport Commission keeps the branch line open.
Mr. Speir: No.
Mr. Popplewell: Where there is no alternative service, the B.T.C. will keep the branch line open. [HON. MEMBERS: "No."] There are bus services everywhere where these lines have been closed. [HON. MEMBERS: "Nonsense."] Very often, due to the failure of private enterprise, the bus service is not as good as is desired, but that is something which hon. Members opposite have asked for, because they have prevented the Transport Commission from integrating the bus services. Therefore, they cannot have it both ways.

2075
When speaking in this House, so that they might get a certain amount of publicity in their local Press, hon. Members opposite should at any rate keep closely to the relevant facts, and in a debate of this nature they should also bring to light the reason why these branch lines are being closed.
10.27 p.m.
Captain J. A. L. Duncan: Three minutes is insufficient time for me to answer the hon. Member for Newcastle-upon-Tyne, West (Mr. Popplewell), although I would very much like to do so. I want to make a plea to the Minister that a thorough inquiry should be made into this whole problem. I have a case in my constituency. Forty thousand passengers a year use the line, but the Transport Commission says that unless there are 120,000 passengers a year it will close the line for passenger services.
Mr. Walter Monslow Mr. Walter Monslow (Barrow-in-Furness) rose——
Captain Duncan: I do not have time to give way. The Commission is keeping the goods trains running but not passenger trains.
My hon. Friend the Member for Aberdeenshire, East (Sir R. Boothby) quoted Germany. Doctor Kreissig, of the German Railways, read a paper to the Institution of Locomotive Engineers in March this year about the cost of operating diesel cars as opposed to steam locomotives in Germany. I have translated the German figures into sterling. Taking depreciation. wages, fuel and maintenance into account, the German figure is the equivalent of 1s. 4¾d. per train mile for the rail-bus running solo, or 2s. 24d. per train mile if a trailer is used when additional accommodation is required, or 478d. per passenger mile or ·33d., respectively.
Mr. Monslow: What reference has this to the subject under discussion?
Captain Duncan: A great deal. That compares with 8¾d. per passenger mile for the equivalent steam train.
My hon. Friend said that rail-cars had never been tried by the Transport Commission. I have with me a photograph of a four-wheel rail-car, the sort of thing we want in Scotland, actually running
2076
between Oxford and Reading. It was started before the days of nationalisation. That sort of thing should be experimented with further to show that we can reduce the costs of operation by at least two-thirds, so that instead of having to close the branch lines they can be operated profitably and encourage traffic. Experience shows that these railcars do encourage traffic. And so we could save all this trouble in the countryside and could keep the population there. It would be for the benefit of all concerned.
10.30 p.m.
The Joint Parliamentary Secretary to the Ministry of Transport and Civil Aviation (Mr. Hugh Molson): It is my lot more frequently than any other Junior Minister to reply to Adjournment debates. In all that experience I have not known one of these Adjournment debates to be so well attended or to be conducted in so lively a manner. I am at some disadvantage, because my hon. Friend the Member for Aberdeenshire, East (Sir R. Boothby) raised this matter because of the allegedly unsatisfactory answer given by my right hon. Friend to a Question which he put on 29th June. My hon. Friend then drew attention to the battery rail-cars which, he thought, might be of advantage. My hon. Friend wanted a general direction given to the British Transport Commission to consider his proposal.
Sir R. Boothby: Hear, hear.
Mr. Molson: In his speech tonight my hon. Friend said he was not primarily concerned with battery rail-cars or with the rival advantages of diesel cars, and he raised the very much broader question of the closing of branch lines. Some of my hon. Friends who have also spoken have widened the issue still farther. As I listened to my hon. Friend the Member for East Aberdeenshire, I thought I discerned a certain amount of Scottish nationalism in his views. A Northumbrian point of view has also been expressed.
In the short time which remains to me, it is my duty, I think, first to deal with the question of the closing of branch lines, secondly with the rail-cars, and thirdly, to indicate what the Commission has tried to do to cheapen and improve the services which are provided to rural areas.

2077
In the first case, this House, regardless of party, has asked the Commission to balance its accounts, taking one year with another.
Sir R. Boothby: It is not going to do that at this rate.
Mr. Molson: I would point out to my hon. Friend and to my other hon. Friends that on Monday last we had a whole day's debate upon the Report of the Commission. When such criticisms are made as have been made it is only right that they should be dealt with in a debate in which it is possible for the Government spokesman to deal with them at full length. It is extremely difficult to me, in the short time I have, to deal with all the subjects which have been raised in this debate.
If we ask the Commission to balance its accounts, we are under an obligation to support it when it asks for the closing of uneconomic services.
Hon. Members: No.
Mr. Thomas Oswald: Hon. Members opposite are willing to spend other people's money.
Mr. Molson: As the hon. Gentleman the Member for Newcastle-upon-Tyne, West (Mr. Popplewell) mentioned, each one of these cases is referred to the Transport Users' Consultative Committee. [Laughter.] It is all very well for hon. Members to laugh, but unless and until some new procedure is provided by this House these public-spirited people, who have these difficult matters referred to them, and who hear evidence presented by those concerned, are entitled to be given credit by this House for arriving at a fair decision.
Hon. Members: Hear, hear.
Sir R. Boothby: Has my hon. Friend noticed where the cheers are coming from?
Mr. Molson: What is more, whenever there is a proposal for a branch line to be closed, a number of those who protest against it are those who have not used the line for many years past.
Mr. E. Fernyhough: How right the Parliamentary Secretary is.
Mr. Molson: Where the Transport Users' Consultative Committee agrees with the proposed closing of a branch
2078
line, the Government are prepared to support the British Transport Commission in what it is doing.
The first thought of my hon. Friend the Member for East Aberdeenshire in raising this matter was about battery railcars. I had provided myself with a number of facts and figures which tend to show that battery rail-cars are not normally any more efficient than light diesel vehicles.
Sir R. Boothby: I do not care which it is, let us have one or the other.
Mr. Molson: When my hon. Friend gave notice of his intention to raise a matter on the Adjournment, he said that he intended to discuss rail-cars.
The first disadvantage from which they suffer is the same as that suffered by the old electric broughams which, Mr. Speaker, you may remember seeing some years ago and which have not become more popular with the passing of time. The disadvantage is the tremendous weight of the battery as compared with the weight of the vehicle. I have made some inquiries about this. The battery rail-cars needed for one branch line cost £50,000, because they have to be built of a specially light alloy on account of the great weight of the batteries.
Sir R. Boothby: They cost less in Germany.
Mr. Molson: That may be so.
My hon. Friend also raised this matter especially from the Scottish point of view. These vehicles are only comparable in efficiency with diesels provided that they are able to be recharged at a cost of not more than ¾d. per unit. The Commission has been in touch with the North of Scotland Hydro-Electric Board. The price which the Board quotes for recharging batteries is 2.1d. The Commission is prepared to undertake experiments provided that the North of Scotland Hydro-Electric Board contributes to the cost and is prepared to agree that if the experiments are satisfactory it will continue to recharge batteries at ¾d. per unit.
As to closing branch lines, at present it is obvious in both England and Scotland that the diesel locomotive is likely to be more economical than the battery rail-car as long as it is not possible to

2079
obtain current at ¾d. per unit. On one of the last branch lines to be closed down in Scotland, the average number of passengers travelling in the two trains that ran in each direction during the day was six and thirteen. [HON. MEMBERS: "That is the answer."] What is happening at present—and this is the reason for the Commission's attitude—is that before the passenger train services are closed, the Commission shows the actual cost of running the passenger trains. If my hon. Friend the Member for East Aberdeenshire wishes to raise also the question of goods trains, I can tell him that it would be economically justifiable to close a large number of branch lines in Scotland and England, which at present are being kept going not because they are an economic proposition, but because they render service to hon. Members' constituents.
10.40 p.m.
Mr. Archer Baldwin: On this question of consultative committees, I would like to read a few lines from the report of the inquiry held in connection with the fight to save the Isle of Wight railways. Here is what Mr. Melford Stevenson, Q.C., said:
"The issue is now clearer than it has ever been since the inquiry began. You have been presented by the Railway Executive with a set of figures that are false, possibly by carelessness or inadvertence. It is no part of my function to assign motives, but the figures have now been demonstrated beyond any doubt as quite wrong."
2080
Yet the consultative committee swallowed those figures and the line was closed.
10.41 p.m.
Mr. William Ross: I think it is remarkable that, after hon. Gentlemen opposite all trooped through the Lobby last year in support of a Government Measure in connection with the railways which, among other things, gave Scotland a special new area council sitting in Edinburgh to deal with all these problems, once again the hon. Member for Aberdeenshire, East (Sir R. Boothby) should come along tonight and say how badly we in Scotland are being treated.
The whole thing arises as the Joint Parliamentary Secretary has shown. He said these lines have been closed down because they do not pay. But what were hon. Gentlemen saying as they stumped about the country only recently? They were saying the nationalised industries were not paying. They will have to face up to the actualities of transport, and when they say that transport must provide the service as claimed by the national interest, they will get some sympathy from these benches. I myself am quite prepared——
The Question having been proposed after Ten o'clock, and the debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at eighteen minutes to Eleven o'clock.

MINISTRY OF DEFENCE
  Christmas Parcels (Kenya)
  Christmas Parcels (Kenya)
  Service Personnel (Political Activities)
  Service Personnel (Political Activities)
  NIGERIA (FIRE-FIGHTING SERVICES)
  NIGERIA (FIRE-FIGHTING SERVICES)
  BRITISH SOMALILAND (BANNED PUBLICATIONS)
  BRITISH SOMALILAND (BANNED PUBLICATIONS)
MALAYA AND SINGAPORE
  Communist Terrorists (Offer of Negotiations)
  Communist Terrorists (Offer of Negotiations)
  Arrested Persons (Detention)
  Arrested Persons (Detention)
  Education (Report)
  Education (Report)
NORTHERN RHODESIA
  Public Order Bill
  Public Order Bill
  Tobacco Industry
  Tobacco Industry
  Trade Union Laws (Amendment)
  Trade Union Laws (Amendment)
  SIERRA LEONE (DISCUSSIONS)
  SIERRA LEONE (DISCUSSIONS)
  HONG KONG (SQUATTER POPULATION)
  HONG KONG (SQUATTER POPULATION)
  NYASALAND (BUILDING MATERIALS)
  NYASALAND (BUILDING MATERIALS)
  NORTH BORNEO, SARAWAK AND BRUNEI (CONSTITUTIONS)
  NORTH BORNEO, SARAWAK AND BRUNEI (CONSTITUTIONS)
  ST. VINCENT (CO-OPERATIVE ARROWROOT ASSOCIATION)
  ST. VINCENT (CO-OPERATIVE ARROWROOT ASSOCIATION)
  SEYCHELLES (EDUCATION)
  SEYCHELLES (EDUCATION)
  KENYA (CONVICTED EUROPEANS)
  KENYA (CONVICTED EUROPEANS)
SHIPBUILDING
  Launchings
  Launchings
  Orders
  Orders
  Anglo-South African Defence (Orders)
  Anglo-South African Defence (Orders)
ROYAL NAVY
  Sea Cadet Corps (Officers' Uniform Allowance)
  Sea Cadet Corps (Officers' Uniform Allowance)
  Serving Personnel (Political Activities)
  Serving Personnel (Political Activities)
  Admiralty Personnel, Simonstown
  Admiralty Personnel, Simonstown
  Royal Hospital School, Holbrook
  Royal Hospital School, Holbrook
WIRELESS AND TELEVISION
  Welsh Regional Service
  Welsh Regional Service
  Chorley Area
  Chorley Area
  Southern England
  Southern England
  Rowridge Station, Isle of Wight
  Rowridge Station, Isle of Wight
TELEPHONE SERVICE
  Radyr, Rhiwbina and Whitchurch
  Radyr, Rhiwbina and Whitchurch
  Israel Service
  Israel Service
  Housing Estates, Cardiff
  Housing Estates, Cardiff
ROYAL AIR FORCE
  Personnel, Germany (Private Accommodation)
  Personnel, Germany (Private Accommodation)
  Meteorological Officers
  Meteorological Officers
  Low-flying, Newark
  Low-flying, Newark
CANALS
  Bridges and Equipment
  Bridges and Equipment
ROADS
  Roundabout, Gallows Corner (Improvements)
  Roundabout, Gallows Corner (Improvements)
  Motorways
  Motorways
  Expanded Programme
  Expanded Programme
  Linlithgow Bridge
  Linlithgow Bridge
  Grass and Weeds Control (Experiments)
  Grass and Weeds Control (Experiments)
  Development Plans, Bristol
  Development Plans, Bristol
  Forth Tunnel
  Forth Tunnel
  Barton Bridge
  Barton Bridge
  Lancaster By-pass and Skerton Bridge
  Lancaster By-pass and Skerton Bridge
CIVIL AVIATION
  London-Northern England Services
  London-Northern England Services
  Civil Airports (Expenditure)
  Civil Airports (Expenditure)
  Passenger Service Charges
  Passenger Service Charges
  R.A.F. Aerodromes (Joint-User Arrangements)
  R.A.F. Aerodromes (Joint-User Arrangements)
  Renfrew Airport (Development)
  Renfrew Airport (Development)
SHIPPING
  Dock Strikes (Cargoes)
  Dock Strikes (Cargoes)
TRANSPORT
  Driving Tests, Morecambe
  Driving Tests, Morecambe
MINISTRY OF SUPPLY
  Swift Aircraft
  Swift Aircraft
  Dunsfold Aerodrome (Noise)
  Dunsfold Aerodrome (Noise)
SCOTLAND
  Fishmeal Factory, Avoch
  Fishmeal Factory, Avoch
  Ferry Service, Toscaig—Kyle of Lochalsh
  Ferry Service, Toscaig—Kyle of Lochalsh
BRITISH ARMY
  Serving Personnel (Political Activities)
  Serving Personnel (Political Activities)
MINISTRY OF HEALTH
  National Health Service (Report)
  National Health Service (Report)
Preamble
The House met at half past two of the clock, The LORD CHANCELLOR On the Woolsack.

Prayers
The Viscount Younger of Leckie—Took the Oath.
The Lord Bishop of Durham—Took the Oath.

AIRPORT COMMUNICATIONS
2.35 p.m.
VISCOUNT THURSO: My Lords, I beg to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they have yet added to their plans for railway reorganisation and development and for road construction some measures for improving the communications of Heathrow and other principal airports in the United Kingdom.]
LORD HAWKE: My Lords, I would refer to the reply to the noble Lord, Lord Rea, on March 1, 1955. In addition, work has now begun on the extension of the Cromwell Road, which when completed will greatly improve road communications with London Airport. A new railway station is to be constructed in connection with the new Gatwick Airport.
VISCOUNT THURSO: My Lords, have Her Majesty's Government noted the statement which has recently been made by the Chairman of British European Airways, about the urgency of improving rail communications with London Airport? Have they noticed that he mentioned that a memorandum had been submitted to the Minister of Transport and Civil Aviation suggesting a spur line from Feltham into London Airport? Is that memorandum being considered, and is any action contemplated?
LORD HAWKE: My Lords, more than one railway scheme has been and is being considered for this particular purpose, but each and every one of them is subject to
666
considerable snags, not the least of which is the high cost which is involved.
VISCOUNT THURSO: Can the noble Lord assure me that the memorandum of the Chairman of the British European. Airways Corporation has been received in the Ministry of Civil Aviation and is being seriously considered by Her Majesty's Government?
LORD HAWKE: The memorandum in question, so far as my information goes, is certainly being considered by my right honourable friend.
LORD LUCAS OF CHILWORTH: My Lords, the noble Lord in his reply to the noble Viscount coupled the Cromwell Road extension with the necessary transport facilities to London Airport. Would the noble Lord tell us when the Cromwell Road extension is to be completed? Does it fall into the category of road which is to take ten years? Is it not necessary somehow to synchronise provision of better transport from London Airport to the centre of London with the expenditure of huge sums of taxpayers' money which is going on at London Airport?
LORD HAWKE: L is expected that the Cromwell Road extension will be completed not later than 1959.
EARL JOWITT: My Lords, if we are going to be able to fly to America in one hour, is it too much to ask that we should be able to travel from this House to Heathrow in a considerably shorter period than that?
Tim LORD PRESIDENT OF THE COUNCIL (THE MARQUESS OF SALISBURY): May I remind the noble and learned Earl that it is in a different vehicle?

NATIONAL DOCK LABOUR SCHEME INQUIRY
2.38 p.m.
LORD AMMON: My Lords, I beg to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will state the names of the members of tie Committee of Inquiry into the working of the National Dock Labour Scheme; the terms of reference; the date when the Inquiry will commence; and whether it will be held in public.]
THE PARLIAMENTARY SECRETARY, MINISTRY OF DEFENCE (LORD CARRINGTON): My Lords, my right honourable friend the Minister of Labour regrets that he has not been in a position to make a statement, but hopes to do so before Parliament rises for the Summer Recess.
LORD AMMON: But this matter was settled as long ago as last autumn. It is of great importance that an Inquiry of this sort should proceed as quickly as possible, especially when the House has agreed that the Inquiry be made.
LORD CARRINGTON: The House rises for the Summer Recess on July 28, which is in about a fortnight's time, so the noble Lord will not have long to wait before he hears the statement of my right honourable friend. The announcement that there was to be an Inquiry was made only at the end of April, and, in all the circumstances, in view of what has happened in the docks since, it was thought inappropriate to announce at that particular moment that an Inquiry was going to take place.
LORD AMMON: But surely the announcement did not arise out of what has happened recently. This matter has gone on for a long time, and what happened recently ought to have accelerated the rate of inquiry.
LORD CARRINGTON: The point is that my right honourable friend did not think it appropriate to set up a Committee to investigate the general question of the docks while a particular issue was in dispute.

INDUSTRIAL RELATIONSHIPS
2.41 p.m.
LORD AMWELL LORD AMWELL rose to draw attention to the changing character of industry and the need for a new outlook in respect of industrial relationships and to move for Papers. The noble Lord said: My Lords, in putting down the Motion for this afternoon's debate my idea was not to invite your Lordships to duplicate the discussion in another place on June 23, but rather to rescue one or two points that I think were significant, and to deal, as shortly as possible, with what I regard as some fundamental considerations
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in respect of the question of industrial relationships and the general industrial position. It seems to me unfortunate, indeed alarming, that in a changing world so many, in all departments of industry and in all divisions of politics, cling to the old ideas and patterns.
For example—and only so, for I have no wish to pursue the point at length—during the recent conference of the Institute of Production Engineers on automation, the President, Sir Walter Tuckcy, said that the automatic factory would double our standard of living by 1984, the year of George Orwell's romance. The tone of that conference was one of tremendous enthusiasm for "the good time coming," but there was not much reference to the many specific problems which are bound to arise especially in the transitional stages, not only of automation but also in the development of atomic energy. Although it is said that there will be plenty of time and that all development will be sufficiently gradual for us to get into our stride, the problems will begin when the transition begins, and that seems to be very closely upon us. One would think that we are to sail into an age of material abundance with no great difficulty, and that such questions as labour displacement, marketing and so forth would present, if anything, only minor difficulty.
Then there is the impact of atomic power. I should imagine that in a machine age and under conditions of world-wide atomic energy and power producing superabundance, the problem of marketing would be of tremendous concern to a nation like ours, dependent as we are on the sale of manufactured articles and coal for our balance of payments. Sooner or later we shall have the position that the whole world, including ourselves, will not want coal; and that development, too, will present a problem in regard to labour and other things. How even supersonic salesmen are to sell superabundance in a power-drenched Empire and world is beyond me. They might as well try to bottle sunshine and sell that. I may be too dismal and premature in my outlook, but, as automation has begun and as atomic power will start being fed into our own grid within the next two years, we ought to be thinking about these problems now. I mention those points to indicate my view that we

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are not giving proper attention to some of the problems and fundamental questions with which we shall have to contend sooner or later.
During the debate on June 23 in another place, Mr. Shinwell said [OFFICIAL, REPORT, Commons, Vol. 542 (No. 13), col. 1563] that these strikes
"are far too numerous and destructive, and, in the end, may prove disastrous."
That statement was supported by Mr. Alfred Robens in even stronger terms. He said, [col. 1561]:
"Our economic position is balanced on a razor edge. We have no 'fat' on which to live."
Those were Mr. Robens' words despite the £5,000 millions of "fat" supposed to have been created on the floor of the Stock Exchange during the last few weeks. He continued:
"An adverse turn in the terms of trade, any slackening in effort, a sharp turn down of our exports, and we may find ourselves in a very desperate position indeed."
Those are statement; from two leading representatives not of the Conservative Government but of the Labour Opposition, which show the seriousness of the position, despite suggestions that the position is not as serious as may be thought because of the fact that not so many men were involved in the disputes that are in our minds now. The significant thing here is that in the changing character of industry and its greater complexity, quite a small number of persons can do a tremendous amount of damage. That fact must be taken into account.
During the debate on industrial relationships there was very little reference to what is probably the most important factor in to-day's industrial unrest, namely, inflation. It is true that, earlier, Mr. Gaitskell had quoted a newspaper article in which the writer made the comment:
"Do you wonder that workmen with £10 a week or less are sticking their hands up to strike for more wages?"
The writer was referring to the Stock Exchange boom and he said that the Tories would have these troubles until they restored real value to the home pound note, by which I imagine he, meant restoring subsidies, and giving perhaps new ones, on the principle that a nation like ours can for ever live by its members taking in each other's subsidies. The problem is much more fundamental than
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that. Some dividend increases are substantial—and I refer to this at some length because behind a great deal of the discussion that is taking place is the assurnplion that the reason for the industrial troubles that we have suffered and that have caused a diminution of £90 million in our export trade is the fact that large dividends are being paid, that fortunes are being made but that workers are not sharing as they should in that wealth. That may be true; but continual harping upon what one might call "the class war theme does not really help us. One of the reasons why a debate in this Chamber should be useful is that, following the historic function of the House of Lords, we can take up points of that kind, develop them and endeavour to get at the facts and their meaning.
What does Mr. Gaitskell propose to do about it or that any Government should do? Labour fights shy of a capital tax. A capital levy was blown sky-high by Bernard Shaw, and if do not know of any authoritative economist in the Labour ranks who really believes that it is possible, in a complex capitalist system, to indulge in the idea of spreading out the amount of money available in the country by encroaching upon its capital reserves. But apart from the question of profits and dividends, I want to get at the facts. The gross profits already go back to the Treasury by more than 50 per cent., quite apart from taxes on the personal incomes of the shareholders. Mr. Gaitskell himself, when Chancellor of the Exchequer, had to confess that if all incomes over £2,000 a year were confiscated the yield would be no more than £58 million, or hardly enough to carry on a major modern war for more than a day or two.
Where does the discrepancy come in when we hear talk of £5,000 millions of "fat" despite Mr. Robens' statement about the country having no "fat" to live upon? Unless he is able to show that to-day any serious difference can be made in the wages situation by getting at this money and how it can be done within a capitalist system which he cannot alter in detail until it collapses, if it is destined to collapse, it seems to me that tub-thumping at that kind does no more than inflame, where a careful analysis would be much better, especially as there is sonic distortion of fact. Gross profits have not appreciably varied during

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the last two years, despite soaring dividends. According to the Labour Press Service gross profits have hardly varied during the last two years. Dividends have gone up over the years since 1935 by 100 per cent. as against more than double that in wages and considerably more in prices. And, of course, dividends reflect the inflationary character of the movements of the economic life of the country.
In the Minority Report on Taxation of Profits and Incomes there are suggestions that a tax on capital gains—which goes all against the Keynes' theory (which is accepted by all Labour's leading financial experts) of priming the pump to all eternity—would stop "conspicuous consumption." A special correspondent of The Times Review of Industry has been analysing a Report of the Inland Revenue Department which says that extermination by taxation does not work. The rich are not noticeably inconvenienced, the writer says, and the steady increase of a class which in theory is taxed out of existence shows the remarkable resilience of capital in a Welfare State. That, of course, is what a Welfare State is for. An early Victorian economist, named Karl Marx, pointed out that capitalism rested upon an average rate of profit automatically thrown up by the money law of private enterprise economy. The rate has varied very little during the hundred years since Karl Marx elaborated the theory of the flat rate of profit. I do not expect modern Socialists to understand or accept Marx's theory. Not even those who call themselves Marxists have ever read his works except at second hand in bits and slogans. I am not a Marxist; I do not agree with either his economics or his philosophy; but he did know his capitalism. A monetary share-out—because that is what is in the minds of the workers especially during a period of inflation—is good powder and shot for elections. No wonder hands go up for striking if the fiction of there being a vast and perpetually illimitable Tom Tiddler's ground is sedulously fostered! It saves a lot of hard thinking. But when men like Mr. Robens admit the fact that we are living on reserves and that there is no "fat" behind us, surely we ought to reconsider the ordinary propaganda attitude that is so much in evidence, and carefully
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examine what the financial and economic position of the country is, especially in relation to foreign trade and all the rest of it.
Frankly, I cannot understand Mr. Harold Wilson's description of the Stock Exchange fluctuations as a huge inflation of capital. I must, I suppose, apologise for that fact to some of my trade union friends, and I do not expect them to go with me in every point I propose to make this afternoon. I cannot help that: they will get their "little bit of fat" later on. I think we have to consider this matter from other than a Party point of view. It is not a Party question, any more than the Welfare State is a Party question. Therefore one has to be a realist in one's economic thinking, and I suggest that the more we can analyse these things the better. I say that I cannot altogether understand Mr. Harold Wilson's description of the Stock Exchange fluctuations as a huge inflation of capital—£5,000 million, I think he said. I do not know what he means. I miss his point. Gambling at Monte Carlo inflates the revenues of Monaco, but what it does in any inflationary way to capital I do not know. If a punter puts a pound on a horse which comes first in the next race—I think that is a proper illustration on a day like this—that pound goes into the bookmaker's pocket: it inflates the bookmaker's income at the expense of the punter. But it is the same pound; it does not become two pounds. In the same way, a shilling which has been lost is found by someone who gives it to a beggar—three incomes, one "bob."
The other kind of calculation has vitiated Socialist propaganda since the Fabian Society invented the fiction of the national "cake." The only national "cake" that exists (and here I am talking real original Socialism) is the goods and services that are available. The idea that we can measure all these things by money, upon the assumption that we can spread money out like muck and solve all our problems, is the kind of thing no Socialist would have looked at years ago, when they laughed at the idea of sharing out. The only national "cake," as I say, is goods and services. This has been not more but less available, just upon a monetary basis. For, after all, the basis of inflation is: the more money the fewer goods and services; and the fewer goods and services the less money

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relative to each other. So the thing has to be probed a little deeper than merely by examining what happens on the Stock Exchange, which I think does not matter a great deal, though I agree that it reflects the inflationary conditions under which we are living. We have had a conspicuous example this week-end.
Our difficulties in the industrial field are not primarily a question of wages. Industrial relations are considerably better than they were thirty years ago. On the whole, both employers and men are satisfied with the existing machinery of negotiation, though not always with the working of it. Clearly, employers would be less concerned with the wages they pay were they given corresponding production: if we want a bigger "cake we must sec that there is more production. It is impossible to eistribute what is not there. We have to knock that into the minds of a good many people who seem to think that there is a "Tom Fiddler's ground" somewhere that we can never get to the end of. That is not true, as the Labour Party itself found to a considerable extent when it was in office.
Production affects the home and the export market in three ways: in price, in quality and in time. Of those three, time—by which I mean the guarantee that the goods will be delivered on time—is more important than is generally understood. That problem of delivery is one that has upset our markets to a tremendous extent. For instance, last year Norwegian shipowners placed orders for eighty vessels in foreign countries. Normally, we should have had 50 per cent. of those orders, but not one of those vessels in in British yards. Bremen, Rotterdam, Hamburg and Antwerp—in all these ports British ships are there for overhaul and repair, in all yards. And that is because of the time issue more than anything else. It is also cheaper—but never mind about that.
There have been some investigations as to conditions of labour upon the Continent, and apart from the question of prices the loss of returns caused by ships being laid up in dry dock is a most serious consequence to shipowners. I have had an instance relating to the case of a £500,000 contract for water power machinery for the Middle East. Britain could not guarantee delivery within two
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years; and the British contractors insisted upon the inclusion of a strike clause. Germany guaranteed delivery, at much lower cost, in three weeks. Those are just one or two instances; they could be duplicated. Almost any newspaper will give you instance after instance of the way in whch the question of time has affected our foreign trade, and the orders to which I have referred. The other day there was a letter in The Times from the glass bulb manufacturers which stated that there were ten million glass bulbs awaiting transport overseas.
There does not seem to be mach thought given to the question of lower prices and full employment together. We may remember that the Labour Government of 1949 devalued, the pound, with the result that prices soared, though the Government of an earlier time acted upon the recommendation of the Cunliffe Commission in 1920 and Lraited the fiduciary note issue to a permitted maximum equal to the actual maximum of each preceding year, and prices rapidly fell so that the: policy had to be abandoned. I doubt if we can have full employment and lower prices. I am sure we cannot unless attention is paid to the question of more: production. Unless we have more production we cannot have these two things together, in spite of the Keynes triology for which our financial pundits fell very heavily, of priming the pump by means, of high wages, high, profits and high prices. The Labour Party, or some of its financial experts, said, "High wages: that will suit the unions; high profits: we can tax those" (in the process of priming the pump, if you please); "high prices: well more wages will solve that problem." That is not very careful thinking but we fell prostrate before Keynes, just as we fell before the noble Lord, Lord Beveridge, at a somewhat later date.
The noble Lord, Lord Beveridge, has pointed out that the Welfare State is precariously balanced. It is very precariously balanced and the Welfare State will be killed stone dead unless something more is done on the lines I am suggesting: that we have some profound examination of our economic position. In his famous Report, Lord Beveridge made it clear that he wanted the world made safe for capitalism. That Report was no Socialist Manifesto. He said that a healthy, contented and productive working-class was essential to the success of

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capitalism and that it was capitalism that was to finance the Welfare State—which, after all, did not begin with the noble Lord, Lord Beveridge. Welfare depends upon competitive success. There is no class war or Party about it, except perhaps in little details; but fundamentally no one is against the idea of welfare, because welfare pays. It is essential for the maintenance of modern business. The biggest of modern businesses have had "Welfare States" of their own for years, and we read of a new development in welfare in America, a very comprehensive one which has trade union agreement.
Now that is not hostility to capitalism: that is the point I want to get home. In these matters the class war had better be abandoned. We live under capitalism and we have to make the best of it, and it is not making the best of it if we sabotage, or talk about sabotaging, it because that is popular in election time. That is a dangerous view which is behind a great deal of the unrest that exists at the present moment. I have heard it said that the Labour Party sold its soul for a mess of Beveridge, but I would not repeat that accusation for the world. Welfare thinking has taken the place of Socialist thinking. But if it is welfare that is wanted, we shall find it worth while to consider carefully where we stand. There is no halfway house between co-operation with, or fighting, capitalism, while it lasts. What I am going to say may sound reactionary to some of my friends, but I want to be realistic. We have either to fight capitalism or cooperate with it while it is here. I will tell you what I think as a Socialist in a minute or two, but we are not living under Socialism. We depend for our bread and butter and for to-morrow's breakfast, lunch and dinner upon the integrity of a system in which we may or may not believe but which is there—and that is the point I would drive home. There is no halfway house between co-operation with capitalism while it lasts (and I will tell you what I mean by co-operation with capitalism in a moment) for production, industrial peace and many other things, and the Communist point of view.
Let us be logical: it is either class war or compromise. Just milking the capitalist cow to death is no solution to anything. After all, compromise is the
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essence of negotiation and it is also, for my Marxist friends, good dialectics. To use Marxist jargon, it is the "true penetration of opposites." It is particularly necessary to examine as they work out today the economics of the system under which we live and by which we live. The community at large has given no indication that it wants any other system. Let me say, in parenthesis—and I think it is necessary to say this or I should be misunderstood, and that would be a terrible thing—that I am a Socialist of the old Libertarian school. I think that liberty is more important than Socialism or any other ism. I do not believe in any State-imposed equality of money income. That is an impossibility, for reasons every Socialist ought to know; and I am certain we cannot redistribute inflation to any advantage. The Socialist idea of equality was never that of sharing out money. It was (and I should like this carefully noted) that abundant production—we come down to production again—believed possible in important primary commodities, at any rate, would, in a free world, render the law of supply and demand, and therefore buying and selling for profit, obsolete and absurd.
I am not arguing the case. The Socialist idea of equality had nothing to do with the distribution of money, nothing to do with doles, nothing to do with "doing good to the poor." As Bernard Shaw said, we did not want to do good to the poor; we wanted to exterminate them. I am not arguing the case: I am putting it just so that it will be understood. Equality was not something in money terms to be obtained by Act of Parliament, but something that would develop naturally and spontaneously as a result of our being able to produce more than could be consumed. That was the background to our idea of economic justice. We may have been premature, but what I now read about the atomic age, which is upon us in full pelt, makes me wonder how near and acceptable a genuine Socialism based on plenty and freedom might be. If we cannot sell against nightmare competition, we may have to consider "producing for use" there is a familiarity about the phrase which I think we shall recognise. We are producing for use even now. We have to do it in a condition of superabundance, because we cannot sell superabundance anywhere when we really get

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it. The only thing we can do is to restrict production, which is a contradiction in terms.
Nor was Socialism considered to be a way of putting capitalism into a State—I beg your pardon, strait-jacket. Morris and Blatchford both wrote anarchist novels in violent protest against that idea. But it seems to be a general idea on the subject at the present time. We did not believe in anything of the kind. The early Socialists believed in free cooperation, a better balanced economy and decentralised administration, so far as possible, because they stood for the smaller unit in the name of freedom and democracy. They believed in the Socialism of man rather than in the entrails of a machine, and they realised that it was impossible to have freedom and impossible to get democracy in remote control and highly industrialised machinery. It simply cannot be done. You can only have tyranny of one kind or another. This is all very philosophical so far, but I think it necessary to make that clear.
One of the obsolescent ideas that persists is that modern strikes are waged against the bosses of industry. They are not. Whatever the justice of any wage claim may be—and of course unions, combinations of workers, exist to press their claims; that is perfectly reasonable and justifiable—nevertheless, strikes are against the community, and the community are, in the main, the rest of the working class. It is not a question, even there, of class war, although it is made to be, especially by our Communist friends. The cost of meeting it is passed on to the consumer to a much more assured degree than was the case in earlier days of cut-throat competition.
It is argued (and this is to the point at the moment in reference to the increased price of coal, and the interview that was published this morning with one of the coal-mining leaders, who says that they are not charging enough for coal) that we should all pay more for our coal and for our food loan we do, in order that miners and agricultural workers should have a better deal. I have no objection to that view; it is a matter for argument and working out. I would not go down a mine for many times the salary or the income that I enjoy at the present moment—I grant that. But the facts
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should he acknowledged, and the pretence abandoned that what the workers get out of the alleged class struggle automatically comes out of the pockets of the owners of capital. I have quoted The Times Review Correspondent upon what is really happening. Higher wages do not come simply from the pockets of the owners of capital; and they cannot in the capitalist system. There are as many capitalists as ever; and as much gorging, guzzling and all the rest of it, as ever there was, if not more, simply because the system does not work otherwise. We talk about limiting dividends. What limit do you propose? I am not arguing in favour of huge dividends, but one must take the average into account. And taking a ceiling of 4 per cent., which sounds extremely reasonable (although if 4 per cent. could be guaranteed to the average capitalist he would be in clover), that makes an average rate of return of less than 22½ per cent., and probably less than 2 per cent. Capitalism cannot run on an average of 2 per cent.
I want to do my best—and I have been trying to do my best, misunderstood very often—to show my own friends in my own Party that all this harping on distributing money and picking other people's pockets in order to make things better for the workers, is based on fallacies. A ceiling of 4 per cent. does not mean that all the returns would be 4 per cent. If it did, you would have a gilt-edged security of some value. The present tendency is disquieting in many ways. How much of the vast fortunes recently supposed to have been made on the Stock Exchange has actually gone in greater "conspicuous consumption," to quote the phrase in the Report, and how much in "fructification," we do not know. But whether profits are ploughed back or distributed, they stand in the main as capital assets. In the end, all of them, except for certain luxury spending—and after all, a millionaire cannot sleep in two beds at once, or eat two dinners at once—are ploughed back by reinvestment, not all in the industries that made them but, in a more general way, in the run of reinvestment. The suggestion that thousands of millions extra goes in orgies, conspicuous or not, is rodomontade.
I have taken that line of thought in development, to some extent, in order

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now to get down to something perhaps more controversial in a practical manner. I noticed in one newspaper a report that there have been talks between the Prime Minister, Sir Walter Monckton, and leaders of industry and the trade unions, giving consideration to basic principles of industrial relationships to be embodied in a document to which trade unionists and industrialists would subscribe. That is not fighting capitalism, but cooperating with capitalism. The report goes on:
"These principles aim at securing a 'pause for reflection' before strike action.… The first principle would be that in no circumstances should a strike or lock-out be declared until all the established machinery for negotiation, including arbitration, had been exhausted. The second would comprise an undertaking that the Ministry of Labour should be notified a reasonable period in advance of notice of a strike or lock-out."
Then there should be set up an agreed procedure, the report went on,
"by which the basic facts of an industrial dispute could be impartially established. Though none of the precepts would have statutory force, if both employers and unions subscribed to them it is felt that they would be a powerful restraining influence."
That is all very nice. But why does that idea not apply to the ballot? No one proposes that there should be legislation, with sanctions and penalties, compelling people to vote by ballot before a strike. It is the same kind of agreement and understanding. The idea of a ballot should be the accepted principle of the union and that would have the same effect—it would have "a powerful restraining influence." I will refer to that in a moment or two.
We have here to get down to a fundamental principle. The rights and privileges of trade unions are not likely to be attacked by proposals of legislation. This Government are not going to attack trade unionism they will not risk attacking it for one thing. We remember what happened in 1927. In any event I object to "multitudinous laws incarnadine"—some of them are bloody, are they not? But responsibility must accompany freedom, as the Trades Union Congress General Council fully understand. What are those rights and privileges? What is their standing? In the first place—and I hope my trade union friends will not jump too soon—there is no moral right
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to any forcible attempt to gain material advantage by inflicting loss and inconvenience upon others—even upon enemies. There is no moral right to strike. Whatever excuse there may be for a strike, there can be no intrinsic moral right to be judge and jury in one's own case. The right to strike is a legal one, resting upon something entirely different: that, short of slavery, no man can be forced to work against his will.
But that principle carries something else. Such a legal right involves collateral respect for the rights of the community. In theory the liberty of the subject is the basis of a legal right or privilege so conferred. Similarly, in the argument for the closed shop we see the same kind of fallacious reasoning. It is said that workers benefit by trade unionism and should be made to toe the line, instead of enjoying benefits at their fellows' expense. That is a dangerous argument. To take an analogy, workers benefit by the legislation of a Labour Government (at least, the Labour Government would say so), but no one can properly argue that, because they do, a worker who supports a Tory, a Liberal, or an Independent at an Election should be deprived, if not of the right to live by his trade, at least of his vote. What is the difference between the two? Both ideas would be totalitarian; and by totalitarianism is meant the right to say that a man shall not get his living because he does not do what he is told to do, and does not join the organisation he is told to join. Labour politics, as well as trade unionism, cost money and these people are not "standing their whack" if they vote Tory, Liberal or Independent. As I say, I am for liberty first, before anything else.
Trade unionism ought to be strong enough to rest its case on moral suasion; and indeed, it is. Its recognised importance in the structure of modern industry makes totalitarian methods as unnecessary as they are alien to the liberal traditions of our land—and I am using the word "liberal" with a small "1." We can surely get on without them. There are not so many blacklegs at heart as all that, and when it comes to members of one union being treated as blacklegs by members of another, surely the limit has been reached. It has a bearing on the other

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question I have hinted at—namely, the question of balloting. The idea of
"I am right and it is therefore my duty to persecute your",
to quote Macaulay, is not absent by any means. No member of a trade union branch who values his peace of mind will take any conspicuous part against popular clamour unless he is made that way. I know what I am talking about. As a lifelong trade unionist I have suffered from just the thing to which I am objecting at the present moment and which seems to be so generally accepted. In matters of political voting abstention is thus accounted for. In an open vote on any vital question the hand goes up very often to avoid being branded. Now that is a fact, and that is a justification for the principle of voting by ballot.
But it is amazing. The Minister of Labour has turned dawn the proposal for a ballot before the strike, although we have had an example of what is happening. The Trades Union Congress have disciplined the trade unions by agreement. Why not the ballot by agreement with the Trades Union Congress? I do not know that anybody has asked for anything more. The value of a ballot is that it puts in the wrong people who want to break laws or rules. No-one says that it will stop a strike—of course it will not; but it will go a long way to sustain freedom of the individual. A point made several times has been that a ballot would take time, and would therefore reduce the effectiveness of the strike weapon. I do not think the strike should be a weapon. We do not want the weapon idea at all. The strike is a final safeguard and a final resort, and this idea of its being a weapon is no good for the interests of the nation. I do not like weapons—I prefer reason. In my view, where there is ample machinery for industrial negotiation the strike, as a weapon, should be barred.
The tenacious fight that has been made in this country for the vote by ballot was for something—a principle—and I do not see why trade unions should be exempt from the democracy our forefathers died for. That is emotional, I suppose, but that is how I feel about it, and about a good many other fundamentals of democracy that are rapidly receding in this brave world of ours. In an admirable
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letter to The Times, Mr. Ted Leather said:
"…ideas about secret ballots and other legal devices have been firmly and universally rejected; all such ideas fall by one critical test. Such laws cannot be enforced when the number of lawbreakers run into thousands."
That seems to me to be a strange doctrine. No-one proposes direct legislation, or penal legislation, against the individual trade unionist, but surely there is a case for the trade unions themselves to make that rule obligatory and to apply their own sanctions if they are required. I think we could leave the justice of that position to the trade unions themselves.
Trade unionism has played a great part in modern industrial -history, but fundamentally the background of all social and industrial reform has been technical development. Not until they have ceased to pay have old abuses been finally and irrevocably ended. I know what I am talking about there: I spent part of my life in one of the worst of the sweated industries in the East End of London, and I know every industry from A to Z as it existed in those days. The whole thing came to an end because it was found much more expedient to utilise new machines. New machines and better methods of production were introduced. It was not a question of trade unions or political pressure at all. The old abuses came to an end very suddenly indeed. Trade unions and, of course, the politicians have dealt with the recalcitrant and reactionary elements as part of their business.
With all respect, trade unionism is not a sacred cow, and is not above Parliament, numbers or no numbers. I think that needs to be said. I do not say that against the leaders, who are sensible enough, but it is certainly against a feeling that runs right through certain sections of the trade union movement to-day. There is too strong an undercurrent—no more than that, perhaps—of totalitarian thought, of Fascist-syndicalist mentality that cannot be tolerated in a free society. Surely the very existence of a ballot rule tit exists in some of the unions, and some of the leaders support it) is salutary, if only for the reason that it puts would-be law-breakers (that is Mr. Ted Leather's term) in the wrong. I do not regard that as an interference with legitimate rights and privileges; it is a special case, if only for the injury inflicted upon everyone by

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unofficial strikes. In a producer's economy the consumer gets the rotten end of the stick every time.
What is needed more than anything else is factory floor efficiency and speed in dealing with the smaller difficulties that should not require reference to remote authority. Good will is lost more on the factory floor than anywhere else. I will give one illustration which is very much to the point. When I was Parliamentary Secretary to the Ministry of Aircraft Production, I had to investigate a threatened strike in a war production factory. That strike could easily have spread, for many of the smaller factories round about the particular area were largely Communist. On the surface the complaint was trivial: tea at the break was too hot to drink. When looked into, however, the real trouble was found to be that the men were given five minutes to drink scalding tea and were then hounded back to their benches by an ex-sergeant-major type of foreman with a full sergeant-major type of tongue. These people are human, and one can understand that when that kind of problem arises the trouble grows. When one wished to see the management, as well as the workers, about the complaint they closed up like an oyster. The men were reluctant heroes, and the whole thing was put down to Communist influence, the assumption being that the Government should step in and deal with the Communists. This type of thing causes a tremendous amount of trouble. It ought to be solved without striking, and by realising the human side, particularly of industry.
Communication and understanding are, above all, the responsibility of individual employers, and I think there is too much "caginess." The greater the mechanisation and the consequent soullessness of modern production, the more need there is to put it back in the human—not patronising or just welfare contact—friendly touch. I think business is beginning to realise this, but humanism is not always present. The point has been succinctly put by Mr. E. V. Francis in the Daily Telegraph. He said:
"If the employers do not want legislation, political interference, or T.U.C. intervention in industrial disputes, are they not being too unsuggestive? It is well to remember that our system of industrial relations stems from
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basic principles of democracy, voluntary association, and independence of authority. The forms of organisation are secondary to the spirit, and good industrial relations cannot be created by legislation. In the last resort, it is good sense and good will of management and men in their day-to-day relations that matter most."
I want now to say a few words, if I am not taking up too much time, on the subject of profit-sharing. This is a very interesting subject, because profit-sharing has existed in this country since the days of Robert Owen. There are hundreds of schemes in Britain alone—quite apart from other countries—corning under the general head of profit-sharing, in which may be included every form of monetary incentive. Every time, the principle comes back to incentive, and there-fore to production. The misgiving with which the idea was received for so long was due to the feeling that profit-sharing was a trick, first of all to get more out of the workers in "surplus value," as it was called, and, secondly, to split the forces of Labour. I notice that Dr. Summerskill has resurrected those arguments, but I think she might have held her hand for the time.
Much of the ancient hostility has died down. Some explanation of this lies in the fact that the idea of marshalling workers behind managements against trade unions was present in many instances. I know of one case in particular, though I need not go into it now. The feeling existed, too, that giving the worker a stake in the business, like giving him a stake in the country by way of facilities for house purchase through building societies, would be to turn him into a Tory for life. Perish the thought! To-day it is better understood that it does not follow necessarily that high production merely stuffs the pockets of idle shareholders when we are, in fact, being priced out of markets by low production. Trade unionism is now too strong for profit-sharing to be so much of a danger, so we might as well look at the question anew. More important, psychologically, is the lingering fear that intensification of production will take us back to unemployment. The answer is surely that low production and inflation will do that more quickly. In any event, new methods in a push-button and atomic age will compel a solution of that question.
The Chairman of the John Lewis Partnership and associated companies has

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said that profit-sharing will fail in so far as it is no more than, or appears to be no more than, a sprit: to catch a mackerel. In this matter, the test of an executive's sincerity will be its day-to-day relationship with its workers and there might be some means of turning profit-sharing (those are my words, not the Chairman's), particularly shareholding schemes, into true partnerships of industry in conjunction with, the unions themselves. Why should not the trade unions train capable men from the floor on staff college lines? I do not mean just electing them on popularity lines to be representative of one side in a quarrel. I mean to train directors who would be appointed on an agreed basis in proportion to the union membership and the number of shareholders. I am not talking of workers' control as an abstraction, but of what can be experimented with and tested, dependent upon thoroughly efficient training with union support and good will.
When we look at the quality of management evolved in the business of trade unionism itself, it seems stupid to talk in old-fashioned terms about the impossibility of the idea. Trained men who know the business from the floor would do more than all the shop stewards to keep an even keel. Business has to unbend in this matter. There is no halfway house, as I have said, between co-operation and Communism. We must either admit that all our institutions, including our social ones, as well as our livelihood from day to day, depend for the time being on the integrity of the economic system under which we live, or we must undermine it. What nonsense this undermining stuff is! Left or intelligentsia—none of them believes in it, however useful it may be to delude the politically illiterate.
Finally, I want to ask a question of the noble Marquess, Lord Salisbury. In the debate in another place, both Mr. Walter Elliot and Mr. Shinwell agreed upon a principle where one would hardly, perhaps, on the surface expect such agreement: that was upon the principle of the establishment of an Economic Council. It was one of the most constructive things the whole of that debate. I agree whit the importance and essential practicability of the idea, provided that it is not again buried in having thrust upon it the obligation merely of
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negotiating individual and niggling disputes. An Economic Council does not mean anything of that kind. Let the negotiating machinery remain. The Council would not he another Royal Commission but a standing Council which would examine, impartially and thoroughly, the whole economic situation of the nation, and of the nation in relation to the rest of the world. The-Council would issue its White Papers, continuously keeping the economic machine under the closest possible surveillance, and the best economic brains in the whole country should contribute to its work.
I will not develop the matter further. There is a good deal in the debate to, which I have referred which might be looked up. The noble Marquess knows the point that I am putting. I should like to know whether it is at all reasonable to expect the Government to come down on one side or the other on that question. If it is a worth-while scheme, it is worth doing as quickly as possible, if possible, I should like to have a reply during the course of this debate as to whether we cannot have a Council of this character which will keep the public well informed—not a secret society in secret business: nothing of that kind, but a Council that will be authoritative about all these problems and, of course, the background of the strikes (if there are strikes), the reasons for them and all the rest of it a Council that will be available so that we shall know where we are going on the questions of wages, industrial relationships, profits, foreign trade, and everything of that kind. I beg to, move for Papers.
3.36 p.m.
LORD REA: My Lords, I do not propose to follow in detail the various points which the noble Lord, Lord Amwell, has made in his analytical, able and remarkable speech this afternoon. We are most grateful to him for having brought forward for discussion a subject not merely of such great interest but of the highest importance in relation to the laying of future plans for the well-being and prosperity of our nation. The need for a new outlook, which is referred to in the noble Lord's Motion, is, of course, an ever-present need, and, indeed, is one which has necessarily occupied increasing

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attention ever since the Industrial Revolution of about 150 years ago. No Government of any political complexion is likely to underrate the necessity for a constantly adaptable outlook upon the delicate and sensitive relationship between employer and employed; a relationship which, of course, covers an ever-widening field, without any coarsening of its quality as a corollary of increase in its quantity.
The gradual, if, to many of us, regrettably slow, shift of the whole picture away from the old reactionary policies of the extreme Right, healthily tempered, of course, by intermittent, empirical lessons of some of the shortcomings of Socialist theories, must be apparent to any rational Government; and there is no reason to suppose that Her Majesty's Government to-day are not fully alive to the great responsibility of maintaining an up-to-date and constantly changing outlook upon constantly changing circumstances. It is, therefore, I suggest, a matter not so much of a continually new attitude which is required—for that is surely accepted as a sine qua non—but of a sufficiently accelerated rate of progress to keep abreast of, if not even slightly ahead of, developments; and to apply to the industrial problems of 1955 the remedies and solutions rather of 1956 than of 1954.
The changing character of industry, which is also referred to in the noble Lord's Motion, is, I submit, a phenomenon to-day which no longer calls merely for a dead-heat between a disease and its cure; it demands on the part of any machine or machinery of conciliation an inventive anticipation, a readiness to be in advance of what is currently and immediately required. It is, I think, this aspect which justifies the call from this side of the House for a general reassessment by the Government, not of their willingness but of their preparedness to meet new situations with new ideas which are not necessarily based upon the traditional remedies of the past.
It is too readily accepted that there still exists, basically and intrinsically, the class distinction which admittedly existed in the industrial field for many generations, a distinction which in its secondary aspect reflected roughly the ability to assume leadership and responsibility as against the struggle to establish a reason-
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ably higher standard of living, but which in its primary aspect, and for basic, logical reasons, meant simply the wide difference in income groups. That wide difference, as your Lordships well know, has gone. We have virtually achieved, at last, the abolition from our midst of the very poor; and, concurrently and inevitably, we have at the same time virtually abolished the very rich. Even the ordinary poor and the ordinary rich (if I may so term them) are not only far closer together in terms of income but are far fewer in number. For that reason, I maintain that the facile bracketing of employer with affluence and privilege and of employed with poverty and exploitation is outmoded and totally obsolete. For that reason, too, the approach to industrial relationships generally can no longer be based upon the political conception of "haves" and "have-nots," since this over-simplification is no longer realistic and its abandonment is already foreshadowed in the significant alteration of the trend of opinion shown by the people of this country in the last election—a trend, I would say, of holding back for some further reassessment.
Obviously, industrial harmony comes only with prosperity and stability, and since full employment in itself is not enough to achieve these, but must be accompanied by high productivity and a check in the rise of costs in all directions, it is most important that Her Majesty's Government should prepare the path of easier and friendlier industrial relationships by, amongst other things, quickening its welcome intention to seek means of bringing into being some sort of partnership and of joint responsibility and advantage between worker and employer. At the same time, I hope the Government will press forward with the encouragement of the easier movement of goods, of people and of ideas, by the rapid reduction of the innumerable barriers of every sort which have impeded us for so long in national and international progress.
3.42 p.m.
LORD BENNETT OF EDGBASTON: My Lords, I listened with great interest to the speech of my old friend Lord Amwell. He has mentioned a number of points, and if I attempted to deal with them all I should take a long time; so I am going to leave such matters as

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dividends and profits, and finance and the Stock Exchange, to others who are to follow and who know more about these things than I do. I was struck with one or two of the comments he made about lower prices and full employment being dependent upon increased productivity. We in the British Productivity Council have been trying to preach that for a long time, and we are very glad to have support from him.
LORD AMWELL: It has been from both sides.
LORD BENNETT OF EDGBASTON: I am glad to hear Lord Amtwell so forceful on that matter. He also said that there are no "gold mines." No employer has a "gold mine"; it all has to be earned before it can be shared. I admire his courage and his broadmindedness in giving us his views on capitalism and for condemning the class war. I was interested in his little chats to his colleagues.
Coming to his Motion, I agree that the public are at the present time most concerned. As the noble Lord says in his Motion, there is in industry a changing character. But that is not new—it has always been changing, ever since I have had anything to do with it; and from what other speakers have said, it has been going on for even longer than that. There has been keen public concern about the recent outbreaks, and there has been a call for action. It conies down to this: that somebody ought to do something to deal with the matter—then there is a full-stop. The schemes that are put forward and have been discussed are not very new; they are mainly A development of existing ideas—whether there should he a ballot or not, and it is in that way that many troubles will no doubt be threshed out. But we must keep a sense of proportion. These waves of industrial unrest come in various periods over the years. Those with which we have been so concerned lately are not so bad as some that we had at the end of the First World War, and are nothing like so bad as some that have arisen in other countries where there has been violence and rioting. I saw stated in the Press (I cannot say how true it was) that if an average were taken for the amount of man-hours lost last year, the figure would be one hour per worker per annum spread over the whole of the working population of this country.
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It is not so bad that we should consider that the whole of our work in the last few years has been useless. It has not; we have made a great deal of progress. I cannot speak for the nationalised industries or the public corporations where there has been so much unrest. I must leave it to those who believe in Socialism to prove that it will work. I am concerned with the ordinary industry of the country, productive industry.
I do not know whether your Lordships realise that in productive industry the large units of which we hear so much are really in the minority in the number of establishments in the country. Factories with up to 100 employees to-day number 38,000, employing a total of 1,390,000 people. Of those having between 100 and 1,000 employees, there are just over 12,000, employing 3 million-odd people; and of those employing over 1,000 people each there are 900, employing 1,980,000. Those are the latest figures, published I think in 1947. We do not hear of a lot of trouble and unrest in these smaller factories; it is in the larger organised units. I have nothing to say about the nationalised units; I cannot speak for them because my whole experience has been in the larger organised productive units of industry. There is often a lament to the effect that it is a great pity that industry has grown large and that the old idea of the man who knew all his workpeople has passed away. But it is only natural, in fact it is inevitable, that that should have happened: it is the result of progress; it is universal, and had we tried to remain a nation of small manufacturers we should not have been able to compete with the Americans or even to feed our people. Moreover, the increased demand for a higher standard of living has meant quantity production, which, in turn, is linked with price, reduction; and that has meant vast capital expenditure. It is only large concerns that can embark upon this large capital expenditure which will enable them to produce goods more cheaply and so spread the demand for them.
In small firms as they exist to-day there is still a personal touch, but in large units that has to be countered in other ways. When, some fifty years ago, I started in business the small organisation was much more universal; the proprietor knew his people, called them by their Christian names and patted them on the back. But

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it was then full-stop; he did not do much else for them. A little paternal gratitude was shown at Christmas time and when they were sick, but that was entirely a matter of charity. There was very little welfare work. I remember that in the First World War, at the time when I was appointed managing director, one of our directors said to me, "You need not worry about canteens; they are the work of catering establishments." But we did worry about them, and we made what contribution we could in order to expand production. To-day, if you look at that aspect alone, you will see what remarkable progress has been made. Canteens are universal and are most sacred—you cannot take them away once you have given them. Production managers come round and want to know if they can have the canteen for expansion purposes. We say, "Not until you have an alternative for it." We should not risk it; nor would they.
In the last fifty years developments all along the line have been remarkable. I have mentioned canteens, but I remember that there were old football grounds here and there round the city. To-day there are big sports organisations which the workers take part in running. There are often successful sports organisations and things of that sort. The workers run them. They are given financial support, encouragement and help; but the work is done by the workers themselves. If you try to run the schemes for them they will not be a success. When I started, so far as I remember, there was no such thing as medical hygiene. To-day, we have medical officers, nurses, ambulance and X-ray rooms; we attend to young people's teeth and feet, and look after their corns. Those things have all developed in the last decade or two. The noble Lord, Lord Amwell, referred to an incident of a cup of tea when we were both at the Ministry of Aircraft Production. Quite right, too. When I first went into industry the foreman was a little king and had almost the power of life and death. He was a sergeant-major. He had "the sack" at his disposal. To-day all that has gone. We have personnel departments, and the worker is not in fear of a sudden spasm of temper on the part of his foreman, for he knows that his foreman will have to go to somebody else to get confirmation and that he will have
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the right of appeal. There is a feeling of security which never existed in the early days. That is all the result of steady effort and of a more enlightened outlook on both sides, and it continues all the time.
To-day, too, there is a great deal of educational effort of all descriptions. There are classes and courses, both inside and outside the factories; there are classes for managers, superintendents, foremen, technicians and other staff; and (probably most important of all) there are courses for charge hands, the men who are in direct contact with the man on the floor of the shop. There are works committees where they meet to discuss various questions. In the old days it used to be said, "I do not know what it means, but they have settled it." To-day the idea is to get men to understand that the word "they" does not refer to an impersonal organisation miles away, but that the men themselves are part of the "they." Schemes have to be explained and gone through with them. If that is done it will be found that the ordinary worker is quite intelligent and anxious to co-operate. But he objects to being treated as a child. It used to be said, "It is no good my making any suggestions, for nobody takes any notice of them." But to-day there are suggestion schemes, and awards are given; workers are on those awards committees—and they are the meanest lot of people on earth and will not let "the other chap" get away with anything unless they think it reasonable. There are works and inter-department competitions, such as that for "good housekeeping," in which there is terrific keenness between departments to see which wins the cup or prize for the year or particular period. To-day there is co-operation such as has never existed before. Industry itself is changing and the attitude in industry is changing.
Perhaps I may mention here one organisation with which some noble Lords are connected, the Anglo-American Productivity Council, which organised and sent sixty-seven teams to America, by invitation and with the cooperation of the Americans. There was a joint arrangement in finances, as we had no dollars; we sent the teams and the Americans looked after them over there. These teams were in three tiers

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which were worked out by committees connected with the employers' side and the trade union side, and the scheme was to be on the basis that teams going out represented the whole industry. Where we could get them, members were chosen in equal numbers from the management, from technicians and from the floor of the shops. They went round and met together and talked before they went. Then they travelled in the same class on the same boat, and used the same hotels. When they came back they made an agreed report which was circulated, and they then took it upon themselves to publicise that report in each of the three grades, management, technicians and shop floor men. That idea had not been tried before, but it has proved a wonderful success. To-day it is being continued by the British Productivity Council: the Americans felt that we had used enough of their dollars and that it was time we stopped sending teams, so we decided to carry on in England. To-day there are local committees and circuit schemes under which people visit factories in their district, not necessarily those of competitors, for you can learn a lot from another man, even though you may think his business is totally different from your own. I am using in the textile business an idea which I got from a meat factory in Chicago. All that is being done by the closest co-operation between the trade unions and the employers' organisations, and I should like to pay a tribute to the trade union officials who have taken such an interest in this matter, despite a good deal of opposition in the early days, as can be imagined.
The main hope for the future lies in a continuation of these efforts, and for heaven's sake let us keep politics out of it, for politics is the last thing that we want in business relations. The trouble with politics is that instinctively we take sides, perhaps because we sit on either side of an old college chapel; otherwise it might be different. We must avoid in industry any idea of taking sides. Sonic people suggest that we want some sudden idea from heaven. Paul saw a sudden light and changed his tracks, and turned about. But the average conversion does not happen like that: it is a gradual dawning upon a man that he is on the wrong track and had better get on to another one. Then we say, "Has not that man mellowed are broadened?" To-day
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we need a steady outlook on our problems. Automation has been mentioned. It is a nasty word, but it means only an extension of what we have been doing for a long time, with the machines carrying operations a bit further, and making wider use of modern scientific methods. There will be opposition, but we must remember that if we do not get on with this, our competitors will. America and Germany are doing it, and we cannot afford to be left out, because, as the noble Lord, Lord Amwell says, we have in future to fight for our lives. No one will keep the British bulldog as a pet, and we must fight for our existence.
These developments, after all, are really the logical sequence to a period of inflation and full employment: they are nothing new. This is a new name for what the engineering industry has been doing for years in other directions. Continuous processes have long existed in the steel, food and chemical industries, and now we are bringing them into the engineering world. But in the engineering world we have for years had such things as travelling belts. To-day, nobody expects a man to pick up heavy castings and carry them about from machine to machine. They are passed along mechanically. Instead of a man picking up such things as castings and cylinder blocks in a motor car factory they pass along the line. I have seen this in the Ford factory in America, and we must follow suit here. But those machines have not just grown; nor have they been fitted up by children. The skill in this country is only being transferred from one end to the other. Professors, parsons, politicians and the Press are lamenting this machine age and saying that we have lost our skill. Nothing of the sort. There is more skill in this country now than there ever was. The only thing is that we have transferred the skill. We do not make Chippendale by hand now; we make it by machine. Machines can turn out Chippendale so that to-day it is better to live in a council house than it was to live in a noble's house in the Middle Ages: it is more comfortable. It is all a question of industrialisation.
Do not talk, either, about redundancy. We are short of skilled labour and the man who to-day is semi-skilled will become skilled. We want men to make

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the machines; then those machines have to be set up and maintained. The tools have to be made for them, too. I remember during the war trying to explain to Members in another place what tools were and why there were delays, and they said to me, "Why not go and buy them?" They thought I meant hammers and chisels. Toolmaking to-day is skilled and laborious work, and these automatic machines will need skilled men to make them, skilled men to operate them, and skilled men to maintain them. I only hope that we get enough skilled men to do these things. It means changes. People, as they get older, settle down and do not like changes. But we shall have to adapt ourselves. As Lord Amwell has emphasised, the great thing is to keep the workers informed. Do not let them find these things out overnight. Tell them what you are going to do, and you will find that they will be with you. Then there are the unions. Most of the unions are prepared to help, but they also must be given information in good time. We have been doing all these things in industry for a long time. I hope that I shall not be accused of trying to pretend that all is for the best in the best of all possible worlds—that is far from being the case. What I have been trying to show is that there is that new spirit in industry which is called for. It has been there for years, and it is now showing results. What we have to do is to see that it is further and fully developed where it already exists, and that it is extended into those areas where, as I know, it does not yet exist.
4.0 p.m.
LORD MACDONALD OF GWAENYSGOR: My Lords, one good thing which has come out of the industrial unrest that has troubled us during the last few months is that the Motion which is on our Order Paper to-day enables us to discuss one of the most important of problems in industry generally. I find that since the recent stoppages the question of human relationships in industry is being widely discussed—in the Press, in Parliament, on platforms and from the pulpit. All kinds of people are busy discussing this subject, and I think it is right and proper that they should. This is not a question that ought to be left to the two sides of industry.
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The two sides of industry are more immediately concerned with the conflict, with the result that they naturally make it a live issue, and I do not think those outside industry can afford to disregard the question. Human relationships inside industry affect the life of the nation generally. I would first say to the Government that I think they are to be commended on this occasion on not allowing themselves to be rushed into hurried legislation on a question of this kind. In 1926 they made a major blunder. The workers then had been thoroughly beaten. Yet the Conservative Government of the day took it upon themselves to introduce drastic legislation which embittered the feelings of trade unionists throughout the country, and that feeling of embitterment remained until the Second World War. The present Government have shown a much more statesmanlike approach to the question. I commend them for having done so.
When I first saw this Motion on the Order Paper, I read that it was designed:
"to draw attention to the changing character of industry and the need for a new outlook in respect of industrial relationships."
A number of questions suggested themselves at once regarding both parts of the Motion. I wondered what my noble friend, Lord Amwell, had in mind regarding the first part. In what way had industry changed, and since when—ten years ago, twenty years ago, fifty years ago? What were the changes which he had in mind? Industry has certainly changed in many directions. As I say, I wondered what was in the noble Lord's mind in putting down this Motion. I do not know now any more than I knew before Lord Amwell made his speech. I thought he would tell us that he had been looking back into trade union history and the history of industry generally, and that he had found that this, that and the other change had taken place, and that he felt, therefore, that we ought to adapt ourselves to these changes. Nothing of the kind. He took us back a century, it is true, and he told us what Karl Marx thought about things in his day, and how right he was in his day. Then he showed an abysmal ignorance of the present activities of the trade union movement. It is not fair that the House should be misled, as though it were the case that the trade union movement and the employers had been sitting still and not

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thinking this matter out. They have spent years in thinking it out.
I thought we would hear from Lord Amwell something about the change in industry consequent upon mechanisation, something about the change consequent upon legislation, something about the change due to the change-over from a period of under-employment to a period of full employment. And I expected that we should have suggestions from the noble Lord to do this that or the other. I must say that I marvelled that a man in his eightieth year could address your Lordships' House so vigorously for over fifty minutes. It was a real test of physical endurance. But, frankly, the noble Lord has much to learn regarding the trade union movement to-day. That movement is very much alive to this question, and the best brains in the movement are devoting their time to it. They are considering what can best be done against the possibility of further strikes here and there. It is not easy with full employment. With under-employment certainly it was easy.
In the realistic and up-to-date speech of the noble Lord, Lord Bennett of Edgbaston, we were told something of the phases through which we have passed We were told of 500 dockers assembled at the dock gates, each anxiously hoping, to be called in. We were told how 50 were called in and the other 450 returned home to tell their families: "No work to-day." Certainly the position was different then from what it is now. And full employment is a real moral test. It must be remembered that some employers failed to stand up to the moral test of unemployment. It is well for some employers to remember that. They took full advantage. I know that, for I was at work in the coal industry. Some poor collier who worked by my side at the coal face would find some abnormal conditions and he would report them, only to be told: "There are scores outside waiting for your place." Some employers used unemployment as a whip to those in work and I say that thereby they failed to stand up to the moral test of unemployment.
There are some workers—not many—who have failed to stand up to the moral test of full employment. Let it be understood that they are only a small fraction of tile, whole. Full employment is being enjoyed to-day. Buy your Lordships must
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know that what is behind the minds of many is the question: "Will it last?" That uncertainty does exist. Men are thinking: "If it is not going to last, what must we do to make the best use of while we have it?" Some of them seek to take advantage of it by working nearly all the hours that God sends in order to make a little money to put by for the rainy day when perhaps full employment ceases. Others decide to have a day off during the week now and then; to buy leisure, and to live on the rest of their earnings under full employment. If the workers could be told: "Do not worry; it is going to be full employment as long as you live" that would remove the sense of fear from the minds of many of them. But, of course, they cannot be told that. They had fear at one time because of the changes caused by mechanisation, but that fear has gone.
We are told by Lord Amwell that we ought to start thinking. I do not know where he has been. It may be that some of the speeches made in another place seemed to him unrealistic, and he may object to them. But I do not know whether he has noted the activity of the trade unions inside industry in this country. I have here a copy of a paper presented at the Margate Conference of the Institution of Production Engineers. I should like to see this in the hands of every noble Lord. The subject is "The automatic factory: how will the trade, unions react?" The author is Mr. E. Fletcher, who has been in charge of the T.U.C. Production Department since its formation and was previously Secretary of the T.U.C. Research and Economic Department. We have been told that we ought to start thinking: this document is the result of months, even years, of thought about how to handle this situation. I should not like it to be thought that trade union leaders or employers have been unconcerned about how things are developing.
The noble Lord was right in saying that automation is simply mechanisation at full speed ahead. Mechanisation at any speed creates problems, and at full speed ahead it creates bigger problems. The trade union movement is having regard to those. It is watching developments in another country where automation is going right ahead and it is watching the reactions of the workers in that country to see how far we should

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follow their example. It is considering what it can do about the sharing by workers in the increased production which is hound to arise and which should be considerable. How far it should be given in the form of cash or leisure or in the form of benefits, such as sick pay or pensions, or social benefits, such as education for workers' children, has to be decided. Automation is coming and is going to bring a tremendous displacement of labour, not into unemployment, but into other jobs. The problem is going to be how to equip those who will be displaced for the other jobs that are going to be vacant. I would remind my noble friend that the trade union movement, and, let me keep on repeating, the employers, have bent their minds upon this important question. The future of our country depends on finding a solution. If the noble Lord's speech were circulated throughout industry, I can think of nothing which would destroy good relations in industry more. We are not out to destroy the good relations that exist to-day, surely; we are out to build them up and maintain them.
I should like to put a direct question to the noble Lord, Lord Bennett of Edgbaston, who is well acquainted with the A.E.U. One of the leaders of that union saw me last night. I wrote down what he said, because I did not want to read out his words if some industrialist on the other side of the House could get up and say they were not true. My friend said that on one side there is the Engineering Employers' Federation and on the other side the Confederation of Engineering Unions—thirty-nine unions. There is no machinery for national joint consultation. When major alterations in industry are contemplated, there is no meeting. The only time they can meet is when a strike is looming or arbitration is forced. I do not know how far that statement is true, but I would say to the noble Lord that the employers in the engineering industry—and I know the difficulties about the hundreds of small employers—have a national organisation and I hope that sooner or later they will find it possible to take into their confidence the leaders on the men's side when they anticipate some major change in the running of the industry.
LORD BENNETT OF EDGBASTON: My Lords, the noble Lord will realise that changes do not take place through the whole range; they take place in individual factories. It is difficult for headquarters in London to discuss with people who know nothing about it what is going to be done in a shop in Birmingham or Coventry or Glasgow. In my view it has to be done on the floor of the shop by the people who are doing a job, with the workers who are going to do it. We shall not get much result by going to headquarters to a conference. The trade unions are helping when there is any difficulty, and if we take the trouble to explain it thoroughly and are not in too much of a hurry we can carry it in our own organisation and do not want help from outside.
LORD MACDONALD OF GWAENYSGOR: I want the noble Lord to see whether some national organisation cannot be set up which can oversee the whole engineering industry. As he knows, the engineering industry is more subject to Communist infiltration than any other. It is significant that the A.E.U. gets the biggest sprinkling of Communist members and we are told from time to time that they count for a lot in the union. What I am asking the noble Lord to do is to counteract that activity by showing that the employers are willing to have a joint national organisation to have oversight of all that is happening. That will help him and the industry too.
The educational standard of the workers fifty years ago is vastly different from the educational standard to-day. The worker of to-day is more intelligent and has far greater knowledge, and he is a more difficult man to handle inside a trade union. He reads about and observes the difference in the standard of life between those who invest their money and those who invest their skill and labour in industry. He sees these things and the trade union leader cannot disregard them, because the trade union leader is elected by ballot and can be removed. At branch meetings the trade union leader is asked what he is doing to increase the workers' share of the prosperity that that industry enjoys. The workers say that they have not had the proportionate increase they ought to have as compared with those who invest capital. I am not going to refer to the

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figures used in another place showing how investors benefit more than anybody else—I do not think that the average worker worries himself too much about that sort of thing. But when we appeal for loyalty, output and production, we are sometimes reminded of these things.
I would remind my noble friend, Lord Amwell, that fifty years ago the Communists played no part in our organisation, and they do play some part to-day. Whatever else we may say about the Communists they are an enthusiastic lot. They are keen and attend branch meetings, which are not attended as they ought to be by other union members. It is those who attend who formulate policy, and those who do not attend complain about the policy later, maybe. There is a tendency at times to see a Communist when there is no Communist and to take advantage of that. I do not think that any of the recent stoppages was due to the Communists. But I know them: they are active and they have to be watched. They are Communists first, second and third. In trying to establish good relations, we must have regard to that fact.
Industrial life is only a part of human life—though I certainly know it is an important part. Its function is to enrich the rest of life. Industrial life fails entirely except as a means to enrich the rest of life. The danger is that man is not always seen in his entirety: he is seen in bits and pieces, as a factor in industry, and only a factor in industry. But man never ceases to be a man in his entirety. I sometimes find when I discuss this matter with Communists that our basic difference comes there. I had an instance of this at the United Nations Fifth Assembly in 1950. As your Lordships know—and maybe the noble Marquess, the Leader of the House, has experienced this—for some unknown reason the British delegate is placed between the representative of the U.S.A. and the representative of the U.S.S.R.; they are his permanent friends on the Committee, and he is looking first right and then left to see what is happening. During a break I said to one of the Russian representatives: "We are wasting our time; we shall never find any agreement." He said: "Why?" I said: "We are not dealing with the same object. Man to you is simply something to be used in the furtherance of State interests. His individual development is not considered by you. You see an economic
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problem, and nothing more than an economic problem, and you decide to solve it by any means. We approach this differently. My Government"—and I could speak for my Government in those days—"sees man in his entirety. He is an economic being, but he is a moral and spiritual being. The result is that we have to find a solution to our economic problems and, at the same time, safeguard his moral and spiritual character." His reply was: "Pie in the sky."
My trouble is that we do not see that sufficiently here. The tendency in one part of the speech of my noble friend was to say, "You have here to-day capitalism. Act accordingly." I am not sure sometimes—and I do not want to rouse the anger in this debate of either the noble and learned Viscount on the Woolsack, or the noble Marquess the Lord President of the Council—but that capitalism is not rather tainted with the same thing that I find in Communism: that is to say, seeing man too much as a factor, and not seeing a man as an entirety and a worker in industry. That is what worries me a little. My tendency to Socialism has always been from that direction. I have always felt that the needs of man in his entirety would not be met except under some economic system on the lines of Socialism. I know that to translate these things into everyday life is our job. The Minister of Labour in another place appealed for "an upsurge of a sense of responsibility." How do you do that? How do you instil a sense of responsibility where there is no sense of responsibility? There was a period in our lives when our sense of responsibility was not as big as it is to-day and was not as real to us as it is to-day. What happened? Responsibility in one form or another was imposed upon us in our trade unions, in our homes, in our churches and in our schools: we were made responsible, and we developed a sense of responsibility in the process. What I want the employer in industry to do is to place responsibility on the worker. The combined experience of the worker in industry to-day is enormous, and he can be consulted even on questions which are considered to be managerial, and managerial alone.
At the request of the late Prime Minister I very grudgingly left the House of Commons in 1942—it was the most reluctant decision of my life—to take on a position in the Ministry of Fuel and

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Power involving control of the North West. Major decisions had to be made from time to time, to close this colliery; or to transfer 300 or 400 men to that colliery two or three miles away. The moment I had made up my mind on the advice presented to me as to the best course to take, the first thing I did was to call in the district officials of the Miners' Federation and the local officers of the branch concerned, and talk to them. We might take weeks or sometimes months over it, but finally the pit was closed, or the men were transferred.
Someone may say: "But that was in the war, when you were able to bring home to the worker the serious need of his doing his job." Why cannot we do it now? I do not know what the Government have in mind. I hope that consultations will continue, not only with the organisations associated with industry, but with other organisations interested in this vital question of human relations. But is there any reason why somebody, somewhere should not try to explain to the public in general the position we are in to-day? The noble Lord, Lord Balfour of Burleigh, often appeals to us on this side of the House to get on the hustings and tell the workers their responsibility. We have done that all down the years, and we shall never stop doing it. I sometimes think that a lot could be done by one of these conferences we had in the war: a national conference, with representatives of both sides of industry, with the Minister of Labour or the Prime Minister, or both, and a leading member of the trade union, to tell the public generally what their duty is. At Election time it is a case of getting votes, and sometimes some candidates do not mind how they get them, so long as they get them. But that is all over now. Surely, something could be done to enlighten the workers generally. We must somehow or other instil this sense of responsibility throughout industry. I think our position to-day is far from being as prosperous as we think it is. The mechanisation of the future will. I believe, be at a faster rate than the mechanisation of the past. If that is going to work to the advantage of the country, then we must get the worker on our side.
With regard to the Communist menace, the most reverend Primate, the Lord Archbishop of York, wrote a book some
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time ago entitled The Age of Revolution. I am sure your Lordships are all pleased to know that the most reverend Primate is back at Bishopthorpe. We hope his convalescence will be a short one and that he will soon be back in our midst. I am sure that he would have taken part in this discussion to-day had he been able. He has been observing the Communists, and I am satisfied that we need to observe them. I have seen their activities in various trade unions. This is what the most reverend Primate says:
"Communists must make their influence felt in trade unions and labour associations. Where there is trouble they must inflame it; where there is none they must make it; they must destroy good relations between employers and employed; they must encourage the continuation of a strike, and obstruct all attempts at a just agreement through negotiation or arbitration. Where sabotage can hinder production, it is to be used. At all times on all occasions the party and the cause are to be given precedence over the interests, safety and welfare of their fellows and the good of the nation. Loyalty as a citizen is to count as nothing compared with loyalty to the cause."
Many noble Lords, like myself, might not subscribe to the whole of that. But changes in industry are not confined to Britain. The Communist world is busy making changes in industry, and the changes they make will impose on us a responsibility for good relations in our industry. Communist China, Communist Russia and the satellites are all busy making changes in industry. I have never believed that slave labour is the best labour; I have never believed that man is the better for compulsion.
That is our problem: how to get the best from both sides of industry and a sense of responsibility right through industry. I believe that the skilled labour in this country is equal, if not superior, to the skilled labour in any country. I believe that the manual labour in this country is as good as, if not better than, the manual labour in any country. I have great confidence in the workers in industry. I am not without confidence in the employers of this country. I think generally they are intelligent, far-seeing and anxious to do the right thing by their country. The most important factor is good relations. Changes in methods, mechanisation, or anything of that kind will not get the best out of industry. Good relations are the only solution, and the employers have a great part to play in getting those good relations. After all, in many cases the men have been with the

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same employers for ten, twenty or thirty years, and they ought to take these men far more into their confidence. These men will not betray them. They will go to the workers and tell them exactly what the position is. I have sufficient confidence in the British worker, once the position is explained to him, to understand that he will get a square deal. He will give of his best as much in peace as he did in war.
4.32 p.m.
THE LORD CHANCELLOR (VISCOUNT KILMUIR): My Lords, I think every one of your Lordships must join with those who have already spoken in expressing our gratitude to the noble Lord, Lord Amwell, for initiating this debate to-day. But, like your Lordships who have already spoken, I do not intend to follow him into the political and economic theory which he put forward as an introduction to his discussion on the theme before us this afternoon. It is not for a moment that his remarks were not full of interest, but the subject in front of us is, in my view, sufficiently important and enormous to deserve of all the time that we can give to it on this occasion.
I should remind your Lordships of one most interesting fact in the speeches that we have heard. They have been from many standpoints—and I have listened to every word with the greatest attention that I could command—but none of them, as I understand it, has complained of the fundamental principle of our industrial relationships at the present day. It is worth stating again that it is fundamental to our system of industrial relations that the settlement of wages and conditions of employment is left to the free negotiation of employers and workpeople freely organised in trade unions and employers' associations. It is for employers and employed to decide on what terms they are willing to live and work together; and throughout British industry the settlement of these terms is generally undertaken by associations with a long tradition of independence and responsibility. As I understand the speeches, no one wants to alter that position—to have any intrusion on the independence which I have endeavoured to describe.
It was interesting that in his current Report, the Director-General of the International Labour Organisation said:
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"A distinct preference for voluntary methods of agreement is a dominant characteristic of the whole policy and practice of industrial relations in the United Kingdom."
My right honourable friend the Minister of Labour, took the Director-General up on that point and said:
"I would put it even more strongly than that. It is more than a distinct preference. It is the basic element is our policy."
I think it is tremendously important that we should bear in mind the gradual growth by which that policy has expressed itself. Over the last 100 years there has been a steady increase in the number of joint arrangements dealing with disputes, and at the same time there has been a parallel development of the system of collective agreements on wages and conditions. It is important that we should realise and adjust our minds to the fact that a system of collective voluntary agreements on wages and conditions of employment cannot by itself ensure the smooth functioning of industry. It must be accompanied by a parallel system of agreements on the procedure for dealing with disputes when they arise. That is, as I am sure the noble Lord, Lord Macdonald of Gwaenysgor, would agree, a responsibility on all the people in the country, whether they be in industry or in Government, or are citizens who are in neither.
That emboldens me for one moment to put to your Lordships what I conceive to be the functions of Government at the present time. Under a system such as I have endeavoured to describe the Government can never be directly responsible for the maintenance of industrial peace. It cannot dictate to the parties the terms on which they must agree. It can, however, encourage the use of peaceful methods for regulating industrial relations and provide services to assist the parties in the maintenance of good relations and the settlement of differences. I think it is worth while reminding your Lordships, in a sentence merely in outline, of the services which the Ministry of Labour do give at the present time. Occasionally, when trouble arises, some of these services come for a moment into the limelight; but the truth is often forgotten that these services are going on working for the benefit of industry, and smoothing the turning of the wheels, all the year round, all over the country. I

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refer to the conciliation services of experienced officers in London and in the large towns, voluntary arbitration officially provided by the Industrial Court and a variety of other methods; Courts of Inquiry which often clear up many of the doubtful points and dispel a great deal of darkness which has shrouded prospective trouble.
I say a word with particular fondness about wages councils because I had some part, in the time of the Coalition Government, in putting the Bill for the reconstituted councils through another place. One has to remember that that system has gone on and been improved. The result is that, although most wages are settled by free negotiation, on a purely voluntary basis, wages in a number of less strongly organised industries are based on the proposals of wages councils which are given statutory backing by ministerial order and enforced by a Government inspectorate. Here again, the settlement of wages is not determined by the Government. It is determined by a council on which both sides of industry, if I may use that term, are represented and an independent chairman presides. Similarly, the Government provide information and advisory services, particularly in regard to personnel management problems. That is the background and that is the position of the Government agency to-day.
The noble Lord, Lord Amwell, referred to a number of current nostrums which are put forward at the present time. The noble Lord, Lord Macdonald of Gwaenysgor, also referred to them and I do not think there is any difference between us. I refer to the suggestions that have been put forward that there should be imposed —I repeat "imposed," because it is very important from Lord Amwell's point of view—measures such as the holding of secret ballots before taking strike action; legislation making unofficial strikes illegal; or the imposition of compulsory arbitration. All these things have been suggested at the present time. May I quote my view with regard to them? In so far as these remedies rely upon compulsion, they are contrary to the basic assumptions of freedom of association and freedom of negotiation on which our system of industrial relations rests. Secondly, without the good will of the
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trade union movement, they would be politically impossible; and in any case it is not practicable to deal with serious industrial unrest by penal measures. I think it is right that a member of the Government should state that quite plainly. The effect will, in general, be good.
Having said that, which is negative, may I say a word on the positive aspect of the Government's approach. We believe that there is nothing fundamentally wrong with the basic principles governing the system of industrial relations which I have tried to describe. Over most of the industrial scene, for most of the time, industrial relations are good. The successful regulation of these relationships is, of course, not news, as the occasional breakdown always is. I think my noble friend Lord Bennett of Edgbaston made that point, but it is worth emphasising how big is the successful sector and how small is the sector in which trouble arises. Like the noble Lord, I do not for one moment want to give an impression of complacency. Recent troubles clearly emphasise that there is room for improvement in the actual conduct of industrial relations. The Government are consulting responsible leaders on both sides of industry and are willing to consider any suggestions which might contribute to industrial peace and the smoother running of our free system. I could not agree more strongly than I do with my noble friend Lord Bennett of Edgbaston that it is a mistake to think that problems of industrial relations are amenable to solution by some general panacea or some general formula.
The problems arising from the employment of more than 22½ million people in a wide range of industries and services must be complex and various. Here I think I am in agreement with something that the noble Lord, Lord Amwell, said on the work on the floor: the solution of these problems depends on good day-to-day work by the thousands of people engaged in dealing with them. I do not want to go into the recent disputes, because I think we are on a more interesting problem this afternoon, but it can clearly be seen from the recent disputes that the difficulties which have arisen are specific and particular and not of a general nature calling for general solutions. They indicate imperfections in the

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conduct of industrial relations, rather than faults in the system. To sum up what I have to say on this point, the Government are anxious to do all they can, in consultation with the leaders of both sides of industry, to improve industrial relations. All ideas will be considered, but they can be successful only if they are consonant with our free traditions that I have tried to describe. Whilst the Government do not disclaim their responsibilities—and I should be the last to do that—they realise that in the end the answer to these problems must rest on the good will and good sense of our people.
I want now to turn to a matter which the noble Lord, Lord Amwell, had clearly in mind—I think it has also been in the minds of many of your Lordships: that is, the problem of industrial relations, especially the human relations part of that problem, in a period of full employment and technological change. As I understood it, that is one of the matters which the noble Lord, Lord Amwell, had in mind, and I think the noble Lord, Lord Macdonald of Gwaenysgor, has assumed that that would be a matter to be considered. We can all, I think, welcome this opportunity of drawing attention to the problems and responsibilities that these changes involve. To-day management can no longer rely on the discipline of "the sack" and cannot expect to recruit from a reservoir of unemployed. The noble Lord, Lord Macdonald of Gwaenysgor, had that fact clearly in mind, and he put it in that moving way in which he refers to his personal experiences. He faced the position, and everyone must face the position, that the unions to-day have immense power in their hands: theirs is a sellers' market. No Highlander can ever forget the effect of past difficulties, because our minds always live a good deal in the past. I realise what are the feelings of the noble Lord on this point, bit I think he would agree with me that in the present position of that immense power and their sellers' market it is incumbent on them to use their power wisely and again with the long-term interest of their members in mind.
We have in the past years seen an increasing proof of the important part the improvement of human relations must play in industry to-day. It matters not from what angle one regards the problem.
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If it is regarded as an end in itself, it is a contribution to human happiness. It can be considered as a means to higher productivity. It can also be considered as a vital contribution to industrial peace. I believe, as I think your Lordships who have spoken will agree, that the improvement of human relations means, as my right honourable friend the Minister of Labour said at Geneva, creating confidence between management and workpeople which will allow men to work together with understanding and with a common approach towards the problems of industry. Again I say there is no golden road. It demands fair and consistent dealing in everyday matters over a long period.
In a time of technological change, when new machines and new working methods are being introduced, there is an especial duty on management to inform the workers fully in advance and to consult with them about matters which will affect their daily work. I so agree with the noble Lord, Lord Rea, that in such a period it is important to be looking at 1956 and not at 1954. Noble Lords would probably agree with me in general that friction in industry often arises simply because people have not been told what is going to happen; they feel that they are helpless, to some extent insecure and subject to arbitrary factors; and they react by refusing to accept responsibility themselves and by resisting change in one way or another. As Lord Bennett of Edgbaston said, good employers in this country have long realised the importance of taking their workpeople into their confidence. There is nothing new in this. What we are pressing for is that the practice of the best, or the good, employers should be more widely spread. I think Lord Bennett of Edgbaston would agree that people often refer to "progressive" firms. What we want to see is that what are termed "progressive firms" should be, first, the fashionable firms; and, secondly, the normal firms. When we get to that I think the position will have improved.
But following up what my noble friend Lord Bennett of Edgbaston said about the American productivity teams, I should like to ask your Lordships to consider what has happened at home on the question of work study—I think it is a remarkable point. I think everyone will agree that a few years ago it would have

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been extremely difficult to obtain the agreement of unions and workers to the introduction of systematic methods of studying jobs by specially trained engineers, using charts and stop-watches. But to-day the T.U.C. itself, and a number of its constituent unions, have recognised that they also have an interest in the improvement of working methods and in the use of some form of systematic analysis of the time taken to perform a job. I understand that the T.U.C. include the subject of work study in courses which they run for union officials, and are fully prepared to accept that what has hitherto been regarded as matters for management are now matters of responsible attention on the part of the unions. My Lords, I think that is a very important advance. The noble Lord, Lord Bennett of Edgbaston, may remember certain inquiries that he and I made together some eight years ago. I think we can fairly say that this is a most important and helpful change of mind which has come into being since together we made those inquiries.
My Lords, the Government welcome these efforts. I have mentioned the Trades Union Congress and their dealings with work study. I did not mean by that to suggest that employers' organisations are not doing the same. Of course they are—the work is going on, and they are providing help for their constituents. As I say, the Government very much welcome these developments. I should like to say this on the point which Lord Amwell had in mind. If the sweeping scientific industrial and management changes which are sometimes referred to under the term "automation" are on the way, in my view they will demand very much more consultation between management and unions. It has been notable, however, in discussions at various conferences recently, and in the Press, that there are no signs of resistance to these new techniques. It is a great thing that I am able to say, with agreement from all quarters of the House, that there are no latter-day Luddites. That attitude of mind has gone, and we can congratulate ourselves that industrial opinion recognises that we cannot refuse to take advantage of technological progress. I should like to pay a very sincere tribute to the statesmanlike attitude which the Trades Union Congress have adopted on
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this point. But we must also take note of a warning (I think this has been implicit in your Lordships' speeches from all parts of the House) first, that the unions must be given full and early information on impending changes, and secondly, that both management and trade unions must give serious consideration to the problems of the individuals affected.
I shall try to be as quick as I can, but I think that the noble Lord, Lord Amwell, deserves some reply on the question of the Economic Council to which he attached importance. This is a very difficult matter, as any noble Lords who have studied the question will agree. The suggestions are very like those that were put forward in February, 1954, by the Courts of Inquiry into the disputes in the engineering and shipbuilding industries. I will not read the words, but your Lordships may remember them, at any rate generally. What has to be faced —I am sure Lord Macdonald of Gwaenysgor, will agree, and if I am not stating it absolutely correctly he will contradict me—is that the T.U.C. opposed the suggestion, as I understand it, broadly for four principal reasons. First of all, they said that general guidance of the sort contemplated by the proposed body without detail would be unhelpful; then, that detailed inquiries would necessarily be prolonged and would almost certainly be out of date; thirdly, that economic questions involved matters of opinion as well as of fact, so that there was a possibility of minority views and minority reports within the body, and that would only impair industrial relations. And fourthly, they said that reports of a general nature might be held by a particular industry not to apply to its circumstances. I hope that I have put the position of the T.U.C. fairly.
The T.U.C. objection had, however, a constructive side which I think has been voiced by Lord Macdonald of Gwaenysgor to-day. They claimed that they were willing to place the truth about the economic situation before their constituents—they had done so in the past and they would do so in the future; and they held that their own pronouncements about the economic situation would carry greater weight than those of a committee which might be regarded with suspicion and might do more harm than good. I have referred to the view of the

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T.U.C. because I think it is important in regard to Lord Amwell's proposal, and because I think everyone must agree that the suggestion of an Economic Council is clearly one which can be fruitfully pursued only with the co-operation of the trade union movement; and in view of their clear opposition it was obviously out of the question to pursue the proposal.
I am not going to weary your Lordships by debating the arguments, which I have tried to summarise fairly, because, as I understand it (I shall be corrected if I am wrong), there is no reason to think that the attitude of the T.U.C. would be any different now from that which was expressed at that time. I say this because I should like Lord Amwell to believe that we have tried to consider the point, and because I realise the feeling with which he advanced it. Apart from the position of the T.U.C. I see two difficulties. First of all, the proposed Council aims, or appears to aim, at combining two functions which are performed to-day but are kept separate: first, the provision of economic information and an assessment of the country's economic position and prospects on a general basis, and secondly, a consideration of particular wage claims. At the moment the first function is performed through the National Joint Advisory Council, the National Production Advisory Council for Industry, Government publications and ministerial speeches. The second is performed by negotiating bodies, arbitration tribunals and wages councils. As I see it, there is a difficulty in attempting to confine the general and particular functions in one high-sounding authority. I felt that it was right to deal with that point and to put the difficulties to your Lordships, and I should he glad to hear any answer to the difficulties which I have propounded.
My noble friend Lord Rea (I say "my noble friend" because our personal friendship goes back some thirty-seven years to the time when we served in the same battalion, a rather long time ago) put forward the expected but none the less important plea for co-partnership and profit-sharing. The last thing that I want to do is to denigrate the suggestion, but I think one ought to make clear what are the limits within which it operates; not to build too extravagant hopes but rather, on the other hand, to face quite
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clearly what are the difficulties and advantages. I hope to show both. I welcome the renewed interest in this subject as a proof that firms and companies are now seriously thinking about the social responsibilities of industry and of the essential problem of arousing the interest of the worker in the enterprise in which he works. If I first speak of the limitations, it is simply to assure your Lordships that I am facing the problem wholly.
I do not think one can say that co-partnership and profit-sharing is, in itself, a solution of the problem of good relations in a particular firm. It is rather something additional which can be brought in after management has convinced its workers of its competence and good faith in other ways. Equally, it is not by itself a solution to the problems of financial incentives to greater productivity, because the amount of money involved is generally too small in relation to wages; and in relation to work actually done it is too remote. Having said that, I hope to convey some comfort to the noble Lord, Lord Rea, by saying that the ownership of shares can lead workers to take a more active interest in the fortunes and financial structure of the firm for which they work. Many good firms now send statements of their annual accounts to all their workers, whether they own shares or not. I believe that this is a practice which is warmly to be commended, because it shows that management considers it has a duty to report to those who invest part of their working lives in the firm, as well as to those who invest their money; and if the workers have some money invested they will be more likely to read financial statements with more care and interest. I think it is this psychological effect, rather than the amount of money involved, which is the most valuable principle of co-partnership and profit sharing.
I am trying to appreciate and face the position of the Trades Union Congress on these points, and I know their difficulties. I know that there are still long and lingering looks behind, and that they rather stand in fear that the possession of shares may have some influence on wage negotiations. Frankly, I do not think that that means much to-day; it is one of those things which still come in from the past. The other matter which the T.U.C. have in mind is that if a worker has invested

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in the shares of his own company and things go wrong, his eggs will be in one basket; and if he is stood off because the company is going through a bad time, that will be just the period of time when it will be difficult for him to get much from the shares. After putting all these points and weighing them up, I strongly agree with the noble Lord, Lord Rea, that what I have called the psychological point is one of great importance; and I hope that the revival of interest and encouragement of this matter will continue.
LORD REA: May I interrupt the noble and learned Viscount for a moment to say that I did not mention the word "compulsory" in speaking about profit-sharing—in fact, I believe that there is very little between us here.
THE LORD CHANCELLOR: I am relieved to hear the noble Lord say that, and I can agree with his concluding remark. I am sorry to have detained the House for so long but, as some of your Lordships may know, this is a subject which has been of great interest to me for many years.
I should like to sum up by reminding the House of the five points put by my right honourable friend the Minister of Labour to the International Labour Organisation at Geneva as being, in his view, the true basis of good industrial relations, especially on the human side. I firmly believe that these points apply to industry in every sector. I do not mind whether it is private, nationalised or co-operative; for in all these sections of industry there are always people who give instructions and people who take them; and in my view these points apply completely generally.
My right honourable friend gave five basic elements. First, the payment of fair wages and the observance of good conditions, without which there is no chance of establishing good human relations; and good conditions must cover not only matters such as hours of work, but also adequate safety, health and welfare provisions. It is remarkable that the first element, and especially the second part of it, was emphasised to-day in almost the same words by my noble friend, Lord Bennett of Edgbaston, from his experience. Secondly, proper and adequate supervision and control; for
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example, to ensure an even flow of work. Forced stoppages of work through lack of materials or of parts can be frustrating and irritating, and can lead to lack of confidence in the management. Thirdly, the provision of information and the perfection of the art of communicating information, including general information about the industry and particular information about a particular firm or business. The fourth element concerns joint consultation. Like my right honourable friend I make that a separate one, because it covers not only the giving of information but the exchange and interchange of ideas, and it is a method of making use of the collective energy of the workpeople and the method of building up confidence as well. The fifth and final element which my right honourable friend mentioned involved recognition of the human factor as of outstanding importance. The policy of management, he said, must be based on the recognition of the fact that a man is neither a tool nor a machine but a complex human personality.
Those were the five basic elements that my right honourable friend put before the International Labour Organisation. So far as I can see, they are subscribed to by everyone in your Lordships' House to-day, wherever he sits. I hope your Lordships will not think it out of place if I pay tribute to my right honourable friend the Minister of Labour. He is a very old friend of mine.
A NOBLE LORD: Of us all.
THE LORD CHANCELLOR: We have for years fought or been together in our professional activities. I mention that because his ability and his personality are entirely his own. I think everyone would agree that his personality has been helpful to everyone in industry during the last four years, and for the reason that he is supremely interested in all the people he meets, and in their problems. I like to think—and I hope that your Lordships will not grudge a lawyer having the thought—that he also benefits from the traditions of the profession from which he comes, which, after all, prizes the reasonable man as an important element in our law, and the pre-eminence of justice and a wide experience of humanity as being the qualities by which the administration of justice is best carried on. I am grateful

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to your Lordships for allowing me to pay this tribute to my right honourable friend, because I think your Lordships will agree that the country owes him much for his stewardship during his term of office.
5.12 p.m.
LORD ROCHESTER: My Lords, I should like first to claim that forbearance which is always granted to those who address your Lordships for the first time. The only justification I can plead for doing so in this important debate is that I have some small but first-hand experience in the management of labour in one of those large industrial organisations to which reference has already been made and which are, it seems to me, of immediate relevance to our debate this afternoon. I would here say that, in my view and experience, there is no reason why disputes should arise more often in big concerns than in small, nor why, having arisen, they should not be settled as effectively in the large undertaking as in the small one. And the reason I say this is simply because good management can, and does, see to it, whatever the size of the organisation, that there is adequate machinery for dealing with disputes at the time and the place at which they arise.
In a debate like this, it seems to me important that we should view the problem in the correct perspective. It certainly should not be supposed that in British industry, generally, relations between management and men are bad. Over a very wide field, in my view and experience, they are probably as good to-day as they have ever been. But it is unfortunately true that the poor relations which do exist tend to exercise a quite disproportionate influence, because they occur in sections of industry which are fundamental to the national economy as a whole. May I observe, without in the least seeking to be controversial, that, in general, they obtain in that sector of industry for which the nation has assumed responsibility. For, indeed, the reason why the State took control of some of these industries was—at least in part—because relations in them had previously been so unsatisfactory. The important point is that, having assumed responsibility for them, the community should see to it that these industries are made efficient, and to-day good relations are
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fundamental to industrial health and well-being.
Before we presume to prescribe remedies for the troubles in these industries, we should first establish the relevant facts about them. The Report and recommendations which have recently been issued by the expert committee which considered the organisation of the National Coal Board were a welcome step in this direction. Now we look forward to the forthcoming Inquiry into the working of the National Dock Labour Scheme. The problem which we are considering is naturally complicated, because it has to do with human beings. I do not pretend to have the solution, but I should like to contribute a few points which are drawn from my own experience and which may, perhaps, be of help to your Lordships in considering this subject. First and most important is the need for good management. There really is no substitute in industry for leaders who know their jobs. This means that in the industries about which we are concerned there must be adequate machinery for the selection and training of potential leaders from within the organisation. It also means the payment of salaries which will attract from outside men of high quality. If the community, including industry under private and company control and owner management, really means to obtain efficient systems of transport and fuel supply, it may, at least for a time, have a bill to foot in seeing that these salaries are paid. But here is no loss, for in the long run it is an investment which will surely pay handsome dividends.
The next subject I should like to touch upon is what is known as joint consultation. It is a commonplace that there have been enormous strides in popular education over the last fifty years. It is also generally accepted that full employment is a social policy which has conic to stay. Management thus finds itself confronted to-day by workmen who are intelligent and more highly educated human beings, and who must be treated accordingly. The corollary is that managers must secure the interest of their workmen, and recognise their dignity as individuals. Joint consultation is all very well, but it will fail like any other machinery if there is not the goodwill and intention to make it work. If it is to show results, the primary responsibility lies with management. The British

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workman of 1955 will make his contribution on one condition: that he is first given information about his work which interests him. Battles in the last war were won by men who had been taken into the confidence of their higher commanders; they knew what they were trying to do themselves as part of an overall design. Consultation of this kind does not even have to take place in committee: it can be carried out on the shop floor as a normal method of everyday management.
The last point I should like to make concerns rewards. There seems to be greater need in industry for the adequate reward of skill and responsibility, not merely in terms of wages but also in status, prestige—call it what you will. In the present state of our industrial development it is one of the functions of the trade unions to seek by negotiation with the employers to procure for their members basic rates of pay which will give them appropriate living standards and which will be related normally to the prosperity of the particular industry. But above these minimum levels there must be adequate rewards for skill and responsibility, not necessarily dictated by the current supply and demand, nor even by equity. It is rather because they alone will supply those incentives which, as a nation, we must have if in future men are to think it worth while to undergo the education, training and self-discipline needed to fit them for the more skilled and responsible jobs in industry.
In the years since the war there has been perhaps too big a contraction in the gap between the rewards offered to the skilled and those accorded to the less skilled. The time seems to have come for widening this gap a little. But on what basis are these differentials to be determined? And how and by whom should the job be done? Here I would venture only one or two observations. First, it is the management which should take the responsibility in the first instance for threshing out the problem and finding the answer. The initiative should also come from the management, not from the trade unions, or Governments or even from Judges of the Supreme Court. It will be time enough to invite the unions to discuss a wages policy when the principles have been
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worked out. Secondly, the structure of wages within any industry must have a rational basis and be related to that particular industry. In the long run it is much more likely to be accepted by the trade unions if it can be shown to be based on clearly defined principles. Thirdly, the problem should be approached in an unhurried way. Here the unions have a part to play in exercising patience while the search is on.
There is only one more thing I should like to say which is relevant to the subject of awards. It concerns the profit-sharing and co-partnership schemes to which reference has already been made. I have only two small points to make about this. First, I would agree that they will prosper only where the management has already earned the goodwill of its employees. In my view they are the trademark of good relations; they are not the cause and certainly not the guarantee. Again, in the current discussion of such schemes there appear to be some people who view their introduction as a means of securing for the employees at least some share in the actual management of the concern. I believe that view to be based on a dangerously false premise. Not long ago a greatly respected leader of British industry found himself faced with a request that a representative of the workmen should be elected to the board of his company. In the course of his reply, this is what he said:
"Industry is one and indivisible; it is one great army and it marches as one army, and it marches under its competent leaders. If they are not competent, then there are means of getting rid of them; but there is only one standard and only one test for those who have to direct and lead and that is their competency to lead."
5.26 p.m.
VISCOUNT BRIDGEMAN: My Lords, it is always a pleasure to be able to congratulate one who addresses this House for the first time, and I do so with particular pleasure after listening to the speech of the noble Lord, Lord Rochester. He has followed the best traditions of this House in that he has contributed his special and first-hand knowledge of the subject under debate, and contributed in no mean terms. When we come to read the OFFICIAL REPORT to-morrow we shall see more clearly how many valuable points he has put forward. I hope very much that he will continue to be able to

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spare time from business to attend your Lordships' House and take part in its proceedings in the same way as did his late father, whose loss we regret so greatly.
When I listened to the noble Lord, Lord Amwell, who I am sorry is not in his place at the moment, it struck me that his approach to the problem was a little old-fashioned, and I was interested when I heard the noble Lord, Lord Macdonald of Gwaenysgor, confirm that view. The noble Lord, Lord Amwell, mentioned one point which I think is important—namely, the difficulty which some of the more conservative members of trade unions feel in going against some policy which might be popular although they consider it to be unwise. That is a feeling I have had for some long time. One may complain of people who one thinks are troublemakers, but I am not at all sure that the people who submit to these troublemakers do not deserve more blame than they sometimes get. The decent, quiet people in any union, if they like to have secret ballots, no doubt will command a majority. I am sure that the noble and learned Viscount on the Woolsack was absolutely right in saying that matters of this sort are within the competence of the unions and organisations which they affect. It is within their power, and particularly within the power of the decent, quiet people who do not want trouble, to put these things right. If the proceedings of unions were improved in that respect it would be a big step towards reaching the objective which it is evident this afternoon noble Lords on all sides wish to reach.
Like some other noble Lords, I was a little surprised when I saw the Motion on the Order Paper, I was puzzled to know exactly what the noble Lord, Lord Amwell, thought were the conditions in industry which have changed particularly. It struck me that although the tempo of mechanisation is increasing and although we talk of "automation" to represent that increased tempo, it is nothing new. Likewise it is nothing new in our history to see a state of acute competition in overseas markets. It has happened time and again. It is happening now and no doubt will happen again: but it is not something fundamentally new. What is happening now is that at a moment when more men are being replaced by machines—and this is taking place at a time of
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full employment—we are in danger of being priced out of markets by foreign competition. So really it comes to tins: that if we replace men by machines, we may (though personally I doubt it) have unemployment; but if we do not modernise our industry and are priced out of the markets, then we shall certainly have unemployment of a type far more difficult to cure than temporary difficulties caused by reorganisation, mechanisation and so forth.
It also struck me that if there was one, new factor in the industrial position, it was possibly this: that we are now getting to a time—in fact, we have got to the time—when every worker who joins industry as a new recruit has received, or is supposed to have received, a secondary education; and I would say that, in practice, at least 80 per cent. of those who join industry and are supposed to have had a secondary education have really had it. That is an important factor, because it means that nowadays there is every reason to believe that the vast majority of the rank and file of industry will be able to give their minds to the problems in which everybody wishes them to be interested. I think it is only fair to say that in the old days quite a number of workers did not find it easy to understand the problems that were put to them; and as a result, it was easy for troublemakers to put the wrong slant on all that the, management were doing and saying.
The more we have educated people in industry, the less it will be possible to do that; and the more certain it will be that when a proposition is put to workers they will understand what it is about. It will be harder for bad managements to get by with bad propositions; and it will be easier for good managements to be certain of getting the cooperation of the workers at a time when something which is not apparent on the surface, or is not apparent as a short-term benefit, has to be put over to the workers at large. Therefore, I feel that this increase of secondary education is of itself going to do many of the things we all want done. Incidentally, it will make it much harder for any management foolish enough to try and do so to treat those people as machines or as units and not as real people.

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My noble friend Lord Bennett of Edgbaston, in his interesting speech, mentioned that we still have a large number of small manufacturing businesses in this country, where the "boss" is in contact with all his workers. However, I think it is fair to say that the trend is now towards larger businesses, and probably is bound to be—for a number of reasons. Therefore, this problem of dealing with the individual must be tackled in a new way. It sometimes strikes me that we who talk about these things do not pay nearly enough attention to the position and importance of the works manager. That rather reminds me of the debates in Parliament on Army matters. You could read columns of Hansard and still believe that there was no one in the Army other than colonels and privates, who were alternately the heroes and the villains of the piece; whereas everybody knows that the person mainly concerned most of the time is the sergeant-major, who is seldom mentioned in the debates. In the same way, industrial debates sometimes seem to me to read as if there were only two sets of people in industry—namely, directors and workers; and they, too, alternate in the parts of hero and villain, according to who may be talking about them.
But in practice, for better or worse, the relations between the employers and the workers depend largely on the personality and skill in man management of the works manager; and the bigger the concern, the more important is the works manager, because he is the one who has to put the policy of the board in operation: it is he who, in a big concern comprising a number of industries, has to advise the board before they take this or that decision. Therefore, in the bigger concerns, the board of directors have to listen to the works manager's advice, and if it is bad advice they will not do the right thing. But, equally, when the works manager has got the policy, they have to back him up and see that he gets the moral and material support necessary in order for him to do his job properly. I am quite sure that the more that line is taken the fewer the difficulties that will appear in what are called the impersonal large organisations.
Equally, I am certain—and I think the noble Lord, Lord Rochester, also said this—that it is unwise to regard what we
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call (I think wrongly) profit-sharing as some kind of sovereign remedy. Personally, I think the term "profit-sharing" is a most unfortunate one, because to my mind, the word "profit" does not mean money that the firm has for disposal. It is a term of art used by accountants to describe a certain figure halfway down the ordinary company's accounts at which the company begins to be taxed. It certainly does not represent anything like money available for free distribution to the stockholders, the workers or anybody else. If ever it comes my way to talk about these things, I try (I do not know whether I am right) to talk not about profit-sharing, but about sharing in the fortunes of the company, because the fortunes of the company are sometimes good and sometimes ill. If the company is producing something, the quickest and most sure way of seeing that employees share in the fortunes of the company is to have a scheme such as I believe all production companies have in some form.
There are many ways of doing it, just as there are many different things that companies produce. Some variation of that scheme, applied to the actual workers on production and to what are called the "non-productive" workers, could be operated in any company I have ever heard of, and with certainty; whereas profit-sharing—that is to say, making some of the money available to the workers which otherwise would be available for ordinary dividend—is a much more chancy matter. The difficulty or ease with which this scheme can be operated varies very much from one company to another. I grant that most of these difficulties are there to be overcome, if you want to overcome them. To mention one or two, there are difficulties of foreign controlled companies and foreign subsidiaries. Take again the wholly-owned subsidiary company which may not itself make a profit, the profit being taken in the parent company. I mention those things to show how cautious we should be in approaching any profit-sharing scheme, because I believe the right way to begin on the plot of allowing employees to share in the fortunes of the company is to see that there exists a proper bonus scheme throughout. After that, as time goes on and as workpeople become better educated, and therefore can be expected to know more about the financial problems with which the

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management have to deal, one might begin to build up some form of—I will not call it profit-sharing, but of making more universal the plan of sharing among the workers some of the money which would have been available for the ordinary dividend. But all these things are a continuous process, as my noble friend Lord Bennett of Edgbaston said. There is no point at which you can call a halt and say that things are going to be different—because they never could.
We happen, because of foreign markets and things of that sort, to have come to a particular stage in our industrial history where the greatest care is necessary, in the financial, the commercial, the technical and the labour field, to see that our industry is organised to meet these difficulties as well as it can do. One of the contributions which any board of directors or top management can make to a solution of this problem is to see that no one is appointed to a position where he will be in contact with men unless, in their opinion, he has the right standard of man-management. Equally, this problem of promotion has always been there. It has always been possible, in well-conducted companies, for the man on the machine or the office boy to get to the top. Here again I could not agree more with what the noble Lord, Lord Rochester, said. People should go to the board room to do jobs which ought to be done in the board room, and nothing else. They should go there because they are the best people to do their job. What is wanted is not that people should try to do other people's jobs, but that people who do one sort of job should be able to understand intelligently the jobs that others are doing. If it is right that they should take over those jobs because they are the best men, then they should do them. So it is a gradual process, and I have no doubt that it will be helped greatly by the expressions which have been made from all parts of the House in this debate this afternoon.
5.42 p.m.
THE EARL OF PERTH: My Lords, I, too, should like to join in congratulating the noble Lord, Lord Rochester, on his excellent maiden speech. He sits in front of me, he spoke in front of me, and if I can follow his example and do half as well I shall be very pleased.
This afternoon the noble Lord, Lord Amwell, and many other noble Lords
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talked about automation and the human problems that arise from it. That is a subject I wish to develop this afternoon, realising, as the noble Lord, Lord Bennett of Edgbaston, said, that automation is nothing new but rather a catch-word to describe a process which has been going on for a long time. None the less, it is certain that we face to-day an opportunity and a prospect of a standard of living that was undreamt of twenty years ago. Our nation has the scientists, the engineers and the skilled workers who can lead us to great prosperity and happiness, and that very soon. The problem, as I see it, is with the worker. If I were a worker in a factory I should be rather worried about this so-called automation—what it held for me, and whether I was going to lose my job. For example, the car factory worker hears about or sees this new wonder. While there is the present demand for motor cars he has no need to worry. While there is a demand and full employment everywhere he knows he is all right. But what happens if times change a little? Then this system of automatic machinery becomes even more necessary than before, if we are to compete or hold our place with other nations. What is important, therefore, is to have him realise that there will be new jobs and new opportunities arising from these inventions.
There is, I believe, a risk that, in our excitement over these new discoveries and our determination to keep abreast of them, we may neglect the labour problems to which they give rise. At this time, as I have said, the danger is not very apparent, as all the pressure is on management to instal labour-saving and automatic machinery. Without, however, the full co-operation of the worker, half the value of the installations may be lost. In a sense we are in what I should call an accelerated industrial revolution, and it is to be hoped that this time we avoid the modern equivalent of the Luddite Riots: that is to say, go-slow movements or even unofficial strikes against new machinery and the introduction of it. If we fail in this, who is to blame? The worker, management, the trade unions or the Government? I should think the worker least of all. The responsibility lies primarily, I think, with the management and with the trade unions. But on a subject like this it is impossible to generalise, because so much depends on

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the individual company and the individual circumstances. I wonder, however, whether it is sufficient to rely on the individual approach, when this problem is so large, and whether the Government themselves have not a very real and particular responsibility.
We were reminded several times to-day of the industrial productivity teams which were initiated by the Government at the end of the war, and of the great success that has followed from them. I am wondering whether something like that is not necessary to-day, and whether the Government should not take the lead. The other day, in another place, the question was raised whether there was not a need for a special inquiry to study the problem of automation and the possible result in unemployment. The Minister of Labour replied that the Government did not consider it necessary to have a special inquiry at present. I do not know what weight should be attached to the words "at present." At any rate, it shows that the door is not closed to such an inquiry. In the meantime, I know it is the hope of all that the trade unions and management will continue, separately and together—and particularly together—to study the problem and see how best they can tell the worker just what is the meaning and importance of these new developments.
5.48 p.m.
LORD SALTER: My Lords, I am glad that my noble friend the Earl of Perth spoke on the subject which he chose this evening. I think that the extent to which economies in technique and in mechanisation are developed and, as a counterpart to that, the consequent effects upon the human beings involved are foreseen and provided for, will, to a large extent, determine not only the future of industrial relations but the future prosperity of this country as a whole.
The noble Lord, Lord Amwell, in opening this debate to-day, said, and I think rightly, that it was a particularly appropriate subject for your Lordships' House. He remarked that as a deliberative Assembly this House has perhaps certain special advantages. I am glad, and I think we all are, that he gave us this opportunity of debating the subject which he introduced. It is a vast and
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complex subject, and we all have to choose on what particular parts of it we shall ourselves concentrate. I should like this evening to say a little on one matter that seems to me of importance: that is, the need to adapt in some respects the system under which labour disputes and wage negotiations are conducted, with the traditions and ideas which determine how that system functions, to the completely novel conditions of the present world in which we live. Since that system was developed we have the new national monopolies; we have an advanced Welfare State; we have full employment; and we have a great change in the distribution of the national income.
The first of those four changes has created a new type of employer. The second relieves the obligation which formerly fell upon a striker and his union to maintain the strikers' families during the strike. The third, full employment, changes substantially the prospect before a hesitating striker. The fourth means that more and more the struggle between economic classes is not between rich and poor generally, but is a conflict of differentials within the workers' world itself.
If we look, too, at the actual strikes which have recently come to an end, and consider their characteristics, we see equally what a changed world we now live in. Let me recall them, if I may, without attempting to express any opinion upon the merits of the particular disputes, but solely in order to show how different in intrinsic character are modern disputes from those which were normal before the war. In rapid succession, we have had the Scottish miners' strike, an unofficial, localised strike in a nationalised industry; then the newspaper strike in which only 700 men, by stopping, affected the work of 20,000 union members in the same industry, and many others both in that industry and outside it. Thirdly, we had the dock strike, the most serious of all, immobilising a large proportion of our shipping and our exports, which was caused solely by an inter-union dispute. Fourthly, we had a seamen's strike of the catering staff of some of our great liners, which was unofficial and was opposed by the Seamen's Union. Finally, there was a strike of footplate men, again in a nationalised industry, where the main difficulty arose from a conflict about

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differentials between two unions. How different are all those from the normal pre-war wage negotiations between unions and employers!
This bare recital at once suggests a few comments: first of all, how unimportant is the wage factor in comparison with other elements, such as, For example, inter-union conflict; secondly, how much greater, how mensely greater, the indirect consequences are than the comparatively trivial amounts immediately involved in any disputed claim. The Government have told us that the indirect consequences of these recent strikes cannot yet be computed exactly. But I think we may safely say that, taking these recent strikes as a whole, the amounts involved for the workers in the industry itself, whether we take what they hoped to gain or what they lost in lost wages, are to be reckoned in millions of pounds; that the loss to industry is to be reckoned in tens of millions, and the loss to the workers as a whole and to the country is to be reckoned certainly in hundreds of millions. This great discrepancy would have been even greater if the strikes had been further prolonged; for the radiating, indirect loss through the stoppage of an essential service can be reduced for a time, but only for a time, by improvisation.
My next comment would be that, in the present world of a Welfare State and modern taxation, more than half of the indirect loss through the stoppage of an falls, and must fall, upon members of unions and their families; if we add the other classes whose income is no greater on the average than union members' wages, the proportion would rise to something like, as a guess, four-fifths. The main part of the loss, indirect as well as direct, as a result of strikes and stoppages, now falls, as Lord Amwell said, upon the working classes. That is true, whether the loss takes the form of unemployment, increased taxation, either direct or indirect, as the only alternative to the restriction of the welfare services, or a limitation of imports through loss of exports and, therefore, foreign exchange, with the necessary consequences of shortages, high prices or rationing.
Two conclusions, I suggest, follow at once from this. The first is that the unions as a whole, with the T.U.C. at
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the centre, now have the strongest motive, in case of any impending or actual strike in a basic industry, to find what kind of settlement would be in the interests of union members generally, and to make it known. The second is that the interests of union members are now so nearly identical with those of the country as a whole that a settlement on this basis—that is to say, a basis which the union movement had decided was in the interests of the union members as a whole —would be unlikely to be unjust or injurious to others.
One other feature of the recent strikes is worth noting. Nearly all of them occurred in industries in which, to an exceptional extent, restrictive practices and ideas limit output and earnings. It is because of that that I welcome the contribution of my noble friend, Lord Perth. The Lord Chancellor said that there are no latter-day Luddites. If he is referring to trade union leaders and to the great political Parties, or if he merely means that people now do not smash up machines, of course he is right. Nevertheless, I venture to say to your Lordships that there is a counterpart to the latter-day Luddites, in that there are in very many industries, though not in all, resistances which effectively prevent the real economies now possible from being made, and therefore the real possibilities of securing a greater output per man and with it a higher average standard of living. There are resistances of that kind, due to a fear that redundancy in a particular job will mean that a man will lose his job. I venture to put to your Lordships, and through you to the union workers as a whole, that, if redundancy means only that two men can do the work of three and that thereupon the third gets a better job and all three get higher wages and improved standards, then it is something to be welcomed and not resisted.
But, as Sir Stafford Cripps pointed out a long time ago, full employment, while it should help that situation by providing an alternative job when there is redundancy in one, is fatal if it is interpreted as meaning that a man regards himself as having a right not only to employment but to employment in precisely the same industrial process in precisely the same place as before. If that view were deeply and widely held, as it is. I think, in some

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industries or in some sections of them, then not only should we have to give up hope of doubling the standard of living in a generation, but we should not be able to hold on, with world competition, even to the standards which we now enjoy.
I quite agree with the noble Lord, Lord Bennett of Edgbaston, that we must not exaggerate the actual consequences of these recent strikes. They are indeed serious. The export figures, as we see in this morning's paper, show that. But I would not say even that they are disastrous, still less fatal, in themselves. Their significance and importance is that they reveal dangers and certain ideas which, if allowed to continue and grow, might well have consequences that in future would be not only disastrous but fatal to the country.
A new policy, a new system, in some respects a change of attitude and ideas, are all imperative. In what direction should we seek a solution? Not, certainly, in a drastic change in the law: I think there is universal agreement in your Lordships' House on that. General outlawry of strikes, the legal compulsions of fines and imprisonment, are impracticable, and, even if they were not, they would be highly undesirable. I believe, as I believe most of your Lordships believe, that the right to withhold one's labour from a job, and to do it not only individually but collectively and within a legal system which, like the present one, permits it, is an absolutely essential right for citizens in a free society. If at any time—I say this because there was a certain amount of irresponsible chatter during, the recent strikes—a Government or a Parliament attempted, otherwise than in the immediate and temporary emergency of a war and its aftermath, to outlaw strikes generally and to exercise penal compulsion, they would have crossed the Rubicon which divides the free from the unfree world.
Yes, but the right of any group to withhold its labour, and to do so collectively, does not in itself imply a right to intimidate others into acting similarly, to victimise or punish those who do not, or even call upon others as a duty, in the name of loyalty, to support a strike unconditionally and without any judgment of its merits. It does not necessarily imply a right to expect that a job,
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however essential to the work of others, should remain left undone. Nor, I suggest, does a right to organise justify necessarily every conceivable form of discipline in relation to the formation of new unions or their extension. These are separate problems, meet for discussion by the trade union world. They may be approved, perhaps in some cases conditionally; but they cannot, I suggest, be regarded as sacrosanct in the same sense as the general right to strike.
If the outlawing of strikes gives no solution, where next do we turn? Not, certainly, to further nationalisation. On the contrary, I think it is essential to realise how the creation of new national monopolies has, in some respects, sometimes aggravated the strike problem. I think it is true to say that proportionately more time has been lost in the great nationalised industries than in industry as a whole. That is partly due to what I have always thought was a fatal omission —I am not now speaking of the general merits of nationalisation—when new nationalised monopolies were created, to consider what changes in the system of wage determination were required as a consequence. The whole of the older system was taken over holus bolus.
But consider the difference. Where a union, as is still the case in the larger part of our economy and in earlier days almost the whole, negotiate with employers, one fact is known to both sides—namely, that wages must come out of earnings. There must be earnings. Both sides know that beyond a certain point—though there is a dispute as to where that point is—higher wage costs would bankrupt the employers and would bring disaster to both sides. But now in a nationalised monopoly it is, and must be, in the minds of both sides that that limitation, which made the old system of union negotiation reasonable and compatible with public interest, does not apply. There is a monopoly, and therefore if there is not enough out of current earnings to meet a wage claim, fares and prices can be put up; and if that limit is passed, this is a State-owned concern and in one way or another the Government and the taxpayer can be involved. That is an absolutely fundamental difference. Of course the law may lay it down that the concern must pay, one year with another. It may continue the old Railway Staff Tribunal, for example, which

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worked well in the past, to be something in between the worker and his new employer. But how fragile these defences are was shown in February, 1951, when, within a few days, first the Tribunal was thrown over and then the Transport Commission, and the Government of the day and the taxpayer were at once directly involved.
I think of this difference the more vividly because I was for four years the last Chairman of the Railway Staff Tribunal in the pre-war and pre-nationalisation days. It was a difficult period, when the full impact of the new motor competition was falling on the railways. But during those four years we never failed to get a unanimous verdict in the Tribunal; we never failed to get it accepted by both sides, and we had no strikes. But is it to be wondered at that that system will not work equally well under the completely new conditions? I suggest that it ought to have become recognised, as a counterpart to the new conditions to which I have referred, that workers in that industry should not—while they may retain the ultimate right to strike as a last resort as a legal right—feel themselves as free at once to jump into a stoppage and strike as would perhaps be reasonable in regard to the employees of a small private industry. If what I suggest should be a code of behaviour for the workers in the industry is so, I believe that that might well affect the attitude of the workers in other industries to a certain class of strikes. What I have in mind specially is strikes in a national monopoly, on whose continued service industries as a whole depend, resorted to without justification and against the will and the expressed opinion of the trade union world as a whole as to the merits.
I should like to make one or two positive suggestions. Obviously, in the ways that have been suggested to-day, the Government, the employers, and the trade unions all have their part to play. As to the Government, of course they must in the last resort intervene to keep the essential life of the country going, and in that term I would include the maintenance of exports. But it should be only in the last resort.
Here, I should like to make a suggestion that is much more modest and, I think, more practical, than that of a
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composite large council composed of the three elements, Government, employers and unions, to pronounce either upon the general economic position or upon the merits of a particular dispute. The Lord Chancellor has, I think, dealt quite sufficiently with the difficulties of that proposal. But it might be possible for the Government, in such association with the employers and trade unions as to ensure impartiality, to see that there is a small fact finding body available for disputes, particularly, but not solely, disputes in the national monopolies. Its task would be threefold: first, to ascertain and make known what have been the changes in the national income since the last settlement of wages within that industry; secondly, what changes there have been in productivity in the particular industry; and thirdly, what are the corn-parable rates of wages and remuneration for similar skilled work in other industries, particularly those where negotiations are still proceeding as they used to generally, as an equal negotiation between the union and employers who have to make their earnings in competitive conditions.
If that were done, I venture to suggest that the trade unions would have the greatest opportunity of their lives and a greater opportunity than any other section of this country to solve the problem that is in all our minds. The unions have the motive, for the reasons I have mentioned, that the greater part of any loss caused by a stoppage falls upon them and their families. They have the power because it is quite clear that no serious strike could continue if workers in other industries definitely refused to support it, even by abstention. I suggest that they have also the responsibility, partly because so many of these conflicts are of an inter-union character, which is obviously a direct responsibility of the union world, and partly because they have the power and the interest.
By this I mean that it would surely not be impossible for the trade union world (I do not say the T.U.C. with its present powers and influence alone) to develop within itself art organisation which would enable trade union opinion to be collectively expressed in regard to any serious dispute. They would have the help of the mare limited fact-finding office to which I have referred; but the judgment

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would be a collective trade union judgment as to whether a particular strike was one meriting the support of union workers as a whole. The loyalty with which trade unionists support each other might in future be discriminating loyalty, in the sense that where the verdict of the union world generally was that a strike was justified they should fully support it; but where that general trade union verdict was that the strike was not justified and was against the interests of the union world as a whole, they would not support it by discouraging others from carrying on the job. I realise that, to reach that point, long and difficult processes of reorganisation, study and education within the trade union world may be involved; but if it could be reached we should be, I believe, in sight of a solution of this problem.
I would suggest to trade union leaders, whether in greater or in lesser office, that if they are able so to organise the whole movement as to be able to express collective union opinion on particular disputes and stoppages they would be doing an enormous service to all their members and to the country. In doing so they would strengthen their movement. Obviously they would increase the influence and importance of their members' views. But because, ultimately, their interests are so nearly identical with those of the country, they would be doing the whole country—as well as those sections who are in the trade union world—a very great service. I venture to put that suggestion to your Lordships and, through your Lordships, to the trade union world.
Obviously, the whole problem before us is one that will take many years to solve and will require the combined efforts of trade unions, employers, Government and public. No one of us here can hope to do more than make a small contribution of such ideas and reflections as may occur to us. Within the limits of the permissible time, or perhaps the rather more than properly permissible time, I have ventured to put my own views before your Lordships.
6.14 p.m.
LORD LUCAS OF CHILWORTH: My Lords, I am grateful to noble Lords who have given me, through the usual channels, their consent to intervene in the debate at this moment on behalf of the Opposition because the Leader of
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the House requires to wind up at a certain time owing to a very pressing engagement. I will therefore keep one eye on the clock and not wander very far from the subject matter of this Motion. Whatever noble Lords may have thought of the speech of the noble Lord, Lord Amwell, who introduced this Motion, I think all will agree that he had every right to say what he did say. It is good that opinions other than orthodox opinions should be expressed. While the noble Lord was speaking there came into my mind a remark used by my noble friend Lord Stansgate on one of those all too rare occasions when he entertains your Lordships with witty and brilliant speeches: that your Lordships' House is one of the few remaining places, even in this country, where a man may speak his mind. Evidently my noble friend did so.
A number of noble Lords have declared an interest so perhaps I should declare my bona fides for speaking in this debate. I have the advantage of having been on both sides of industry. Graduating from the shop floor, I have been an employee and an employer. I cannot claim ever to have been a shop steward, but for five years I was chairman of a national joint industrial council, when I was president of an employers' organisation. So I can at least claim some slight knowledge of the problem. After the stirring and eloquent speech of my noble friend Lord Macdonald of Gwaenysgor, than whom no one speaks with greater authority for the trade union movement in this country, I will not say much about strikes, but I welcomed what the noble and learned Viscount on the Woolsack has said, as a statement of Government policy: that there is not the slightest intention of bringing in legislation. That would be the biggest folly of any Government—I do not care whether it is legislation on secret ballots or not—for in the last analysis the only course is logical education and persuasion. No one in this world—at least not in a free country—has yet found what to do with the man who sits down and says, "I will not."
Noble Lords on this side of the House have not attempted to hide their deep concern at the unofficial strikes that have taken place. Some of us have striven throughout our industrial lives to bring dignity to labour. We had always thought

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that when the clay arrived when, as a country, we could give security, good conditions and good welfare, a new dignity would descend on labour. That a relatively small handful of malcontents cart upset this is, to us, a bitter disappointment, but we are glad to know that there is nothing between us and Her Majesty's Government upon the way to deal with this matter. I agree with what has been said by the noble Lord, Lord Bennett of Edgbaston, whom I have known all my industrial life and with whom, politically. I have never agreed and from whom, industrially, I have never disagreed. With him, I believe that industry has never stood still in grappling with problems.
The present is a momentous time to discuss this question because we are to-day living under conditions that have never before obtained in the history of this country. We are on the verge of nuclear industrial power of which I hope the noble Marquess who leads your Lordships' House, and who is responsible for its development in this country, may tell us something. What a huge problem we have! Then there is automation—a hateful word, as noble Lords have said. But we have something which is presenting us, and which will present us, with an even bigger problem than those two factors. For the first time in our lives we have full employment. How can we fit all this new development into a context of full employment—or, let us admit it, in some respects over-full employment? Perhaps a better expression than over-full employment would be "concealed under-employment." I will explain precisely what I mean.
These matters will present us with some very stern problems; we have to ask ourselves some very stern questions, and we have to find some honest answers. One great problem is confronting Her Majesty's Government now. I will only mention it in passing, as I see that on about the last sitting day of the present term of your Lordships' House we shall have the opportunity of discussing the Report of the Monopolies Commission. Restrictive practices in industries in this country have, more than any other single factor, "feather-bedded" incompetence. We talk about greater productivity—and I do not dissent from one word which Lord Macdonald of Gwaenysgor has said on that subject. He said that that is our key to success, and I am delighted that he said it.
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Full employment does not mean, and never has meant, a freezing of the industrial structure of this country. It never could mean that. It means that there will always be a job for those who are ready and willing to work. But the restrictive practices and price rings and other arrangements in this country are harbouring thousands of redundant workers who ought to be released for more profitable work in industries that are screaming for labour. That is a matter which is going to face the Government and the country with a very hard choice. Do we want an element in competitive industry in this country that is going to weed out the incompetents, or are we going on with a system that is going to "feather-bed" them and force us to carry them? If we had full employment, with everyone working 100 per cent., and machine development up to 100 per cent., then, as my noble friend has said—and this has been echoed by the noble Lord, Lord Bennett of Edgbaston—the wisdom and the skill of the people of this country would know no bounds, and prosperity would be here for all time.
That brings me to what I consider the greatest problem we have to solve. As my noble friend again said, it is useless to deny that underlying all this industrial unrest—I do riot want to exaggerate, but it is no good shutting your eyes to it—is the fear on the part of the average worker in this country that there is no such thins as continuous full employment. He says that there never has been. "You have told me this before," he says. "You told me this after the last war; you told me that the harder I worked the more prosperous I should be. And in two and a half years I, and two and a half million of my pals, were unemployed." And the workers now ask: "What is the difference to-day?" What is the answer? They were told between the wars, in the late 'twenties and the early 'thirties, when we had that two and a half million unemployed, that the harder they worked the sooner they would work themselves out of a job. The tragedy is that that was true. How can we get over that to-day? How can we give that confidence which is so necessary to the worker? How can we get him to take the long-term view? As my noble friend has said, you learn from talking to men on the shop floor. You say to them, "Don't do this; what you lose now you will gain tenfold

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in five years' time." They say, "Yes, guvnor, but give us a bit now." That is human nature.
What is the answer? I believe that the answer will be found upon the lines of guaranteed work. We have moved away from the "hourly sack"—that is sacking at an hour's notice—to a week's notice. I believe that we have to move steadily towards giving the worker something approaching, maybe, a yearly contract. I believe that those two great American companies, the Ford Company and General Motors, are thinking along the right lines. A great many problems are going to arise out of this, but I believe that we have to give the worker who works with his hands the same security as we give to the man with the white collar in the office. I should not like to see it brought in too hastily, but that is the end to which I believe we have to work.
We must not forget human nature. We have to thank the noble and learned Viscount who sits on the Woolsack for giving us, in an extraordinarily good speech—if I may say so without impertinence—the thought that "man is not a digit." You can put digits in columns, and they stay there. But you cannot put human beings in columns. A human individual is a very animated being, with passions, loves, hates and all the rest of it. And the first question he asks himself when any proposition is brought to his notice is: "How does it affect me?" One must always bear that in mind. This is a world of security. Perhaps that is not so good—I do not know. Some of us may have achieved what success we have achieved in a world of insecurity, hazard and scramble. Perhaps it is not so good to have security. But a real urge for security is sweeping over this world at the present time. And after two world wars, terrific unemployment and slumps and booms, we cannot expect anything else. In America, a move has already been made. The greatest private enterprise country in the world is now seeking to ensure permanent security for its workers. And I think that is what we have to do.
I should now like to say a word on the thorny subject of profits and capital. There is more nonsense talked about profits, I think, than about anything else.
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I am a believer in the profit motive. So is everyone else. There is nothing wrong with the profit motive. What is wrong and what has been wrong is the use of the profit motive as it has been used over this last quarter of a century—especially between the two wars—to break the lives of individuals. What we have to do is to give incentives to the people to increase their skill. To induce the unskilled worker to become a skilled worker he must be given a profit motive. Everyone has had the profit motive before him since childhood when he was occasionally given a penny to buy sweets. I became a capitalist at the age of three years, when an aunt of mine gave me a money-box into which I put pennies. When I was a worker, an employee, I assure your Lordships that I never wanted to work for any firm that made a loss. That did not attract me at all. And since I have been an employer, I have never been able to pay high rates out of a loss: the only way I have known of paying them is out of a profit. Let us get out of our heads the idea that profits are something indecent.
What we have to do is to give higher and higher rewards, and we can do that only out of an industry that is profitable and in a country that is prosperous. There is much nonsense talked about high wages pricing us out of the export markets. I read some of this in the Tory Press and it makes me sick. This really is a veiled attempt to get a devaluation in wages. High wages will never price us out of the export markets, any more than low wages in the 'twenties and 'thirties priced us into them. What we want is higher and higher rewards, coupled with higher and higher productivity. What we have to do is to find the way of relating rewards, basic wages and incentives to productivity. As my noble friend Lord Amwell has already said, increased productivity is the only way by which we can get anything. I thought he made that abundantly clear. So I hope we shall not hear so much in future about pricing ourselves out of the export markets. What will put us out of the markets is low productivity and, as my noble friend says, late delivery.
Late delivery is a bug that now has bitten Her Majesty's Government. The other day I heard the Minister of Transport say with some pride in another place

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that we are going to get roads in ten years' time—when some of the great turnpikes in America have been built in three years. I wonder what would have happened during the war, just before the invasion of Normandy, when we were assembling our Forces and the American Forces in the New Forest, where previously we had no roads on which a tank could go and where we had built some of the finest roads in the world, like the one from Beaulieu to Lymington, if the immediate past Prime Minister had been told, "Yes, you can have them in ten years' time." Your Lordships can just picture what he would have said. This is becoming a fetish. If you want anything in industry to-day, your supplier seems to glory in the view that it is a sign of business and prosperity that he cannot give you delivery under two or three years. That is a problem of management, and one that has to be overcome.
Another point I want to mention is this question of profit-sharing. My views on this were well stated by the noble Lord, Lord Rochester, who I thought made one of the best maiden speeches I have heard in this House for a long time. I say this with some diffidence, but I have never believed in profit-sharing and co-partnership. I do not doubt for one moment that it is being advocated by sincere and honest people and I do not attribute any base motive. I remember some of the speeches on this subject made by the noble Marquess the Leader of the House and some by his noble uncle, Lord Cecil of Chelwood, whom we miss so much from this House at the present time. Profit-sharing will never contribute anything material to the solution of the problem we are trying to solve, because although profit-sharing schemes are all right while there are profits to share, when, through no fault of the workers, there are no profits to share, then they are the basis of trouble. I have seen it happen so many times—through a fault in design, over which the worker has no control, he does not get anything at the end of the year. There is only one way to give incentives and that is to relate the incentive as near as we can to the physical and mental effort of the individual. As soon as he has to rely upon somebody else, then there is trouble. I know that in some occupations this is
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not easy to do, but we have to get as near as we can.
When we get shares offered to workers, then I begin to have my suspicions. In profit-sharing schemes in the past, the workers have taken up only a small percentage of shares. When they have had them, and if they had any sense, when a high profit was to be obtained on the Stock Exchange, they cashed them. Why should they not? When you get workers' shares with strings tied to them, as I saw the other day in connection with a well-known company, who were offering workers' shares at par, which they could sell only to other employers at par, I thought to myself, "What is this? This is a labour anchorage scheme, not a profit-sharing scheme." Why should the worker who has shares in a company be treated any differently from the ordinary shareholder who can take his profit if he wants to do so? And what is going to happen to the shares that go below par? No, there is no future in a system of profit-sharing. The workers do not want to manage the company. Many a worker has said to me that it was for him to produce and for me to turn his efforts into a profit. He did not want to manage the concern. Many of us who have everyday experience of industry will freely admit that one of the greatest difficulties we have to-day is to get youngsters to take responsibility. They want security, not responsibility.
That brings me to my penultimate point—namely, joint consultation. Again, I agree with the noble Lord, Lord Rochester. I am in favour of joint consultation, but it must be on the floor. That is where it should start. But we should also have consultation at top level, as my noble friend, Lord Macdonald of Gwaenysgor, said in his interesting suggestion to the noble Lord, Lord Bennett of Edgbaston. I see no reason why the Engineering and Allied Employers' Federation cannot have a standing joint committee with the trade unions. I think that the workers should be told about what is being done. But we cannot start an industry doing what we have not been able to do before—that is, divorce authority and responsibility. Industries cannot be run by committees. In our industry, in a highly competitive world, there must always be somebody to say:

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"Let's go." The man who says, "Let's go" five minutes before his competitor says the same thing is the man who wins.
This committee talk ran through industry two or three years ago like a disease. I believe that managements must treat the worker, right from the lowest level, as a colleague in the business. But if anyone thinks the worker—if I may use the vernacular used in the shop when anything goes wrong—is going to "take the can back," then he is mistaken; and it is unfair to ask him to. It is the management's responsibility to carry the workers along, and that happens in all good shops to-day. The noble Lord, Lord Bennett of Edgbaston, was quite right. Here we have—I hope for a long time to come—in the engineering industry, at least, predominantly the small firm. I know that in this highly competitive world we must, in the struggle for efficiency, end up with the large unit. One of the troubles to-day is that no director of any concern of any size has a halfpenny in the concern; they are really only employees. An executive director has one share signed on a blank transfer; and that applies right through industry to-day. It is seldom that one finds in a large concern any director with a substantial holding. I consider that there should be consultation from the highest to the lowest level, right the way through—but not by set committees, because committee minutes are not a marketable commodity in industry; they cannot be sold; and more time is wasted by committees than in any other way I know.
I want to say one last word, and I want to say it quite seriously to the Government. I believe that one of the greatest deterrents to full production is our tax system. I think there is something wrong in a taxation system—I am not talking about the weight or the incidence of taxation, but about the system—which, first of all, is a definite deterrent to enterprise, risk-taking and initiative, and which, at the other end of the scale, makes absenteeism profitable. I would ask the Government to look into this seriously. I do not think there is any royal road—certainly not by legislation—by which we can solve the problems. If we could always reckon on such a humane, understanding Minister of Labour as we have now, I should have no fear for the future. But we should be
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doing him an ill-service to say that he is indispensable. We have got to find a new spirit, and I believe that that is where some of us, perhaps, make a mistake. Some of us who are bitterly disappointed with some of the happenings in the industrial world to-day are perhaps trying to make haste too quickly, or are trying to change human nature too quickly. But I am sure that the employer of labour has a bigger part to play in this matter than even the worker. His is the main responsibility, and if only he will seize it, and bring to labour in industry in this country that dignity which we so much require, to double the standard of living in twenty-five years will be just a spare-time occupation. We have the brains and the "know-how" and, if your Lordships will excuse a vulgarism, we have the "guts" as well.
6.45 p.m.
LORD GRANTCHESTER: My Lords, I know that the noble Marquess, Lord Salisbury, has another important engagement and I want to refer only to one or two matters which have not been touched upon as yet. I think it is quite clear that the problem of human relations in industry is just a question of the acceptance of an all-round sharing of responsibility. The evolution of responsibility is possible now because it can be built on the basis of the safeguards of the welfare society and the higher wages which are now being enjoyed. We are really seeking to proclaim a new public philosophy and to announce a new approach in industrial human relations: and this means that no one can undertake a job in management without sharing responsibility, and that everyone who works in industry must, as a deliberate act of will, be willing to accept the sharing of the responsibility which is offered. I think this follows in our Western tradition, based upon the philosophy of the classical times and picking up the philosophy of the Middle Ages, with their respect for natural law above people and Government alike.
On a less philosophic level, I want to say a word or two on the question of incentives. I agree with the noble Lord, Lord Lucas of Chilworth, that the most direct incentive is the immediate reward on the basis of work done. But that reward, to be effective, must enable the worker to obtain what he desires as the

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result of his work. I hope that the artificial distinction between necessities and luxuries will be abandoned, and, as I have mentioned before in your Lordships' House, I should like to see the purchase tax abolished. I feel that it puts articles for which they work out of the range of the workers and acts as a definite disincentive to greater effort. I should like to see the substitution of a retail sales tax, excluding items of food, of, say 5 per cent., until such time as the Government do not need the revenue—if that time should come.
One other matter to which I wish to refer is the subject of the nationalised industries. The noble Lord, Lord Salter, referred to these, to some extent. In my view, the workers in the nationalised industries feel that nationalisation was sold to them on a fraudulent prospectus, or at any rate a misleading prospectus, which contained an economy of truth. I am not imputing any intent to deceive, but it is clear that nationalisation has not turned out for them what they thought it was going to be. But where we have nationalisation, we have to see that it works. We, the public, are now the proprietors, the shareholders, and we have to accept the consequences of being the owners and workers respectively in a public service.
So far as the owners are concerned, I think this means that we have to assume the ultimate responsibility for a fair wage scale for all grades. Whatever the façade set up to manage, the Government cannot evade final responsibility. I suggest that what is required, somewhat on the lines of what the noble Lord, Lord Salter, suggested, is an advisory council, a sort of Whitley Council for the nationalized in-dustries, to which disputes can be referred, and that workers should be willing to remain at work while disputes are referred to such a council and until its recommendations are approved by Parliament. In my view, the Government are really the executive for the people in the matter of the nationalised industries, and they must set up any machinery necessary. In the event of a deadlock, they must accept responsibility for the terms of service, much as they do in the older Civil Service. We have to face up to this fact, and if we do so I think it will have two good results. It will be fair to those who work in these industries, and
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it will be a warning against adding to the list of nationalised industries.
Then there are many businesses of a semi-professional nature. It is the custom of the trade unions who look after the workers in these businesses to negotiate with the management salary scales based on age and service. In these days of full employment and rapidly changing conditions, I think this is much too rigid a method, and works to the detriment of efficient and progressive workers. I should like to see the trade unions concerned consider this matter and adopt methods to-day different from what they thought of thirty years ago. They should adopt a policy of greater flexibility, particularly in the matter of differentials, to which those who keep themselves up to date with new developments and new methods are entitled.
I now turn for a moment to the question of profit-sharing, to which the noble Lord, Lord Lucas of Chilworth, referred. I admit that this is a difficult subject when considered over the whole range of industry, and it would be well for those who are considering the matter at the moment to refer to the Report of the Royal Commission which, I think, reported in 1925. As the noble Lord, Lord Lucas of Chilworth, said, it is no good starting schemes in which interest fades out after quite a short period, as happened in many of the businesses which were investigated by the Royal Commission in 1925. I do not think profit-sharing could be introduced in a big way, under which individuals can benefit, without involving the counterpart of profit-sharing—namely, loss-sharing. I cannot imagine that this possibility would be likely to appeal to anyone at the present stage of industrial relations.
But there is one method which, although not providing great individual incentives, would benefit the staff of an industry as a whole, and I think it ties up with the idea which I have tried to put forward—that of the evolution of responsibility. It is that, after an agreed level of distribution to shareholders, a share in any increased distribution should be paid into a fund for the benefit of the staff. It would be appropriate if such a fund, as I should like it to be built up, were administered by representatives of the staff, who would thus gain experience in investment and in the management of capital, as well as in the use of it

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for the benefit of those with whom they work. A scheme like that involves no question of sharing losses, and it gives an overall incentive for good teamwork.
The final point I wish to make is the question of a more imaginative campaign for saving and for small investors in industry. It is true that there are means of saving which to some extent benefit from the increasing dividends paid by industry, but I do not think the opportunities are sufficient. I should like to feel that the Treasury and the Board of Trade would be willing to consider a modification of the law (which I suspect is necessary) to bring in, for small investors, a simplified and less expensive way of acquiring an investment in industry, perferably with a good spread. I have something in mind on the lines of a unit trust, with a simplified form of procedure. I think a scheme which would enable quite small savers to invest generally in industry, or a group of industries, would in many cases provide a more satisfactory investment for them than putting their savings in the businesses in which they may be working. It is upon lines of this sort that I think there can be an improvement in personal relations, the object of which is to make everyone happier in his work; and it is to happiness in their work that all in industry should try to contribute.
6.56 p.m.
THE MARQUESS OF SALISBURY: My Lords, I should like first of all to apologise to the House for intervening before the original list of speakers was completed. It is, as your Lordships know, something I seldom do, but, as the noble Lord, Lord Lucas of Chilworth, has already said, I have a long-standing official engagement which I promised to fulfil, and I felt sure that the House would understand if I trespassed on its kindness.
And now I should like to come directly to the substance of the debate. It arose, as we all know, in this way. When the recent railway strike came to an end, a proposal was put forward that there should be a special debate on that strike and the lessons which were to be drawn from it. I consulted with the leaders of the other Parties in this House, and we were all agreed—and I am sure we were right—that a debate when the strike was hardly over and feelings were still seriously
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exacerbated would be unlikely to produce any useful results and was liable, indeed, to do a good deal more harm than good. It was far better, we thought, to allow a breathing space to elapse and then in the light of recent events to have a wider debate over the whole area of industrial relations. It was exactly at that moment that we heard that the noble Lord, Lord Amwell, had put down a Motion which seemed to have exactly the scope and purpose which we had in mind. I must say that I think the House owes him a most sincere debt of gratitude, both for timing his Motion so well to produce the valuable debate we have had this afternoon, and also for himself approaching the delicate questions with which he had to deal in what I thought was an extremely fresh and thought-provoking spirit.
There is no doubt that recent events in the industrial sphere have come with a considerable shock to the British people. They had thought that we in this country had the finest system in the world for regulating relations between employers and employed. That system, as we all know, had been built up by a long process of trial and error over a period of upwards of a century—perhaps the noble Lord, Lord Amwell, would say longer than that. It was operated by leaders on both sides, who were wise and experienced in the ways of conciliation, and also by a great body of workpeople who were animated by a similar spirit. We had come to believe here in Britain that we were reaching a point where, though no one in any section of the community questioned the right of a man to withhold his labour if he wished, the strike weapon would in fact be rarely used, and then only when every other conceivable alternative had been tried. Then, suddenly, we were brought up against a series of disputes which seemed to indicate that that assumption was not entirely valid and that in, at any rate, some industries, the system was not working quite so smoothly as we assumed it always would. In circumstances of that kind, I think it is not at all surprising that the public mind has been seriously troubled and that we should all be anxiously inquiring what has gone wrong with this system, of which we had, and still have, a very high opinion.
It would, of course, be profoundly wrong—and the noble Lord. Lord Bennett of Edgbaston, emphasised this earlier in

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the debate—to exaggerate the extent and the area of these new and disconcerting developments. In the great majority of industries to-day the system of collective bargaining is working admirably. That is borne out by the simple and obvious fact that industrial production is, I believe, higher to-day than it has been in any period in our history. All that is most satisfactory; but it does not alter the fact—and it is a fact which we cannot ignore—that, though this system is working so well in the majority of industries, it has shown serious defects in others. Its failure in the industries where it has not been so successful has been so far-reaching, as the noble Lord, Lord Salter, in the remarkable speech which he delivered to us this afternoon, pointed out, as seriously to prejudice the prosperity of the industries where it was in fact succeeding.
For the industries where it was breaking down—and this was the point made in the admirable maiden speech by the noble Lord, Lord Rochester—are key industries, predominantly transport industries, in fact; and transport industries are, of course, the main arteries of trade and commerce. In the modern world, therefore, as I see it, a strike in the transport industry is not what it used to be in the past—that is to say, just a dispute between the employers and the employed, or a dispute between one union and another, like any other dispute—though that may be the intention of those who are directly involved; it really works out as a trial of strength between one section and the rest of the community. And the same, I suppose, would be true if we had such a strike—I hope we never shall have another one—in the coal industry which, in this country, where there are no other sources of power, provides the life-blood of our whole industrial system.
I have no doubt at all that the slow strangulation of this country is the last thing that the average worker in these industries wants. The vast majority of them, as we all know, are ordinary, decent, patriotic citizens, as are noble Lords here. They do not want national ruin. Indeed, they would be horrified if such a thing were suggested to them. What they want is what they regard as justice: in other words, they want a fair
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deal, and that, as I see it, is just as much in the interests of the rest of the community as it is in theirs. In such circumstances, it seems to me, after listening to this debate, that the main questions before industry and the country at the present time are: first, how to ensure that those people will get a fair deal; and, secondly, and equally important, how to give them confidence that they in fact have had a fair deal, taking into account all the circumstances of the case. I am afraid that the second is likely to be a good deal more difficult than the first.
The noble Lord, Lord Amwell, in his extremely interesting speech, as I understood it, thought that the best approach to these two problems was by means of a standing economic council which was to watch the economic situation and, as required, to give wise advice to all concerned about any new developments that might occur, so that the fairest possible deal could in due course be obtained for all concerned. He pleaded that case with great persuasive power. On the face of it, I should have thought there was nothing in that proposal to which anyone could properly object. But, my Lords—and this has already been said by my noble and learned friend the Lord Chancellor—a great deal of advisory machinery is already in existence; and, with all deference to the noble Lord, I have serious doubts—as has the Lord Chancellor—whether yet another advisory body, however distinguished it might be, would do all that he hopes of it. Moreover, there is always a danger that a body so distinguished as that might slip into the position of being an arbitral body. If it became an arbitral body, I imagine it would not be acceptable to the trade unions themselves.
Then we had another proposal, rather of the same kind, from the noble Lord, Lord Salter, who speaks with immense authority on these subjects. As I understood his proposal, it was that he recommended the setting up of two bodies, one a fact-finding body—some kind of independent fact-finding body—and the other an organ of the trade unions to express trade union opinion as a whole. So far as the first is concerned, that is a matter which would require further consideration. I hope that the

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noble Lord will allow me to pass it on to my right honourable friend the Minister of Labour. So far as the trade union body is concerned, he knows much more about these things than I do, but I am not quite clear why the Trades Union Congress could not already do that particular job.
LORD SALTER: The first body was a purely fact-finding body without the element of discretionary opinion upon a particular dispute, which I think is open to all the objections that the Lord Chancellor expressed. So far as the trade union body is concerned, what I was hoping was that there would be such a development of organisation within the trade union movement as to enable such opinions as are sometimes expressed by the T.U.C. to be really effective to a degree that they are not effective now in determining the attitude of the workers throughout the trade union movement.
THE MARQUESS OF SALISBURY: That is a matter for the trade unions, and not for me. I have no doubt that they will take note of what the noble Lord has said. Indeed, I feel sure we shall all take note of everything he has said, because, as I say, he speaks with great authority on these things. But, having said that, I must add that, personally, I cannot help feeling that the real remedy for our difficulties is to be found not in any change of machinery, but in a change of heart. As I see it, that is bound to involve—and it is no good our blinking the fact—a slow process of education, and education not on one side of industry only. First, I suggest that management, so far as they are concerned, must be ready (and I think the noble Lord, Lord Macdonald, has already made this point) to take the men much more into their confidence than has been the case in most businesses in the past. Too often in the old days—and even when I was young—the view was taken that the men could not be expected to understand the intricacies of business; and the way to satisfy them, we were sometimes told, was to see that they got their pay packets punctually, that they got proper amenities, and to leave it at that. I do not dissent from the fact that it may possibly be true that in some cases that would be the best way to satisfy them and keep them contented, but it is not the
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way to give them that responsible outlook which alone in the long run will make industry, whether nationalised or not nationalised, happy and prosperous.
This is becoming, as we all know—it has been mentioned to-day—more and more generally realised by the whole body of progressive employers. A science, about which we have heard a great deal this afternoon, is growing up under the name of "human relations." It has this exact purpose in mind: to create a new and better relationship between the management and the men. The science of human relations, as I understand it, means, in simple words, if I may paraphrase what was said by my right honourable friend the Minister of Labour, in a recent speech, creating that confidence between management and workpeople which can enable them all to work together with a common understanding and a common approach to the problems of industry. That is really what is comprehended in this new science.
There is, of course, no short cut to this new outlook. It involves, first, a record of fair and consistent dealing between employers and workpeople over a pretty long period, so that they may absolutely trust each other. It involves the management giving the workers frankly the facts, wherever they can be given, as to the situation both of their own firms and, so far as can be done, of the industries of which they form part. It also involves telling the workpeople beforehand (this has been stressed I think in a good many speeches this afternoon) of any projected changes, technological and others, which are likely to affect their interests. Finally, it involves taking them into consultation and treating them very much as human beings, and not merely as cogs in an industrial machine. On that point, if I may say so in passing, I was entirely in agreement with Lord Macdonald of Gwaenysgor who made it with considerable force. But I thought, as I listened to him, that he was a little out of date in his view of modern capitalism, just as he thought that Lord Amwell was a little out of date in his view of modern trade unionism. I do not think that the modern capitalist is quite as old-world as Lord Macdonald of Gwaenysgor seemed to consider him.
There is, of course, nothing new about this approach to our problems. Good employers have long realised the import-

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ance of taking their workpeople into their confidence. But having said that, I must add that I do not pretend that it is always as easy as it looks. It may be, and I think is, a comparatively simple matter to create a good human relationship between the management and workers in small, compact firms; but it is far more difficult, and inevitably so, in huge concerns which are nation-wide in their operation and which employ hundreds of thousands of men and women. The noble Lord, Lord Bennett of Edgbaston has said, with all his knowledge, that we have this great organisation for better or worse. But, even there, I believe that much can be done by devolution, by joint industrial councils, by joint works committees and so on, and, I say with some trepidation to the noble Lord, Lord Lucas of Chilworth, with schemes of co-partnership and co-ownership in one form or another such as are being ever more widely adopted in recent years.
As the noble Lord knows, I have long been a believer in these schemes just because they imply a common interest between those who lend their money and those who lend their labour in a joint concern. Indeed, I regard the question of status as far more important than any question of the money they get or the money that they do not get. The noble Lord, Lord Lucas of Chilworth, seemed to adopt the attitude that these schemes had never succeeded. But I remember a very successful scheme, the South Metropolitan Gas Company, which was deliberately slaughtered by the noble Lord and his colleagues in the days of the last Government. He may perhaps have read an interesting letter in the Daily Telegraph by Mr. Spedan Lewis to which I think the noble Lord, Lord Amwell, referred in his speech to-day.
The noble Lord himself, and also Lord Rochester, sounded a warning note with regard to schemes of this kind; he said, as I understood, that they must not be regarded as a panacea for all our ills. We all know that that is perfectly true. No-one, so far as I know, except an absolute lunatic enthusiast, has ever suggested such a thing. But what they can be in suitable cases is one, and to my mind not the least important, method of bringing about that better relationship which we all have in mind to create. I think I can say—and in so saying I am not conflict-
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ing with anything that has already been said by my noble and learned colleague the Lord Chancellor—that such schemes would, I am quite certain, have full sympathy from Her Majesty's Government. Indeed, I personally feel (here I am sure that I shall have the agreement of the House) that in this new and bewildering world in which we live we ought to rule out nothing which may bring happiness and security to the working people of this country.
My Lords, I have tried in what I have said to sketch in, I am afraid too briefly and inadequately, the kind of contribution which I suggest might be made by managements to a solution of our present difficulty. In fact it is being made in a great many cases, though it might be made even more widely. But if there is a contribution which management can make, there is equally, I believe, a most important contribution to be made by labour, and especially the leaders of labour. Above all, there are some illusions, deep-seated illusions, which must be eradicated from the minds of those who work in industry. The noble Lord, Lord Amwell, referred to one or two of them. He spoke of a popular illusion, which I certainly should not be so impertinent as to mention in your Lordships' House, were it not so prevalent outside that it cannot be ignored—that is, that the State has an inexhaustible supply of money of its own which it can, if it will, dole out to indigent industries. There seems even now to be far too little understanding, even among quite intelligent people, that the Exchequer is merely the reservoir into which flow the streams derived from profits in industry; and that if, by any mismanagement of ours, those streams were to dry up and the reservoir become empty, the results for us all would be absolutely disastrous. I ant sure that all of us, in whatever part of the House we sit, would agree with that; but it is not universally accepted.
Then there is another equally fundamental truth, namely, that producers and consumers are not different people. We are all, within ourselves, both producers and consumers, consuming either our own or somebody else's products. Therefore, in the complicated type of society in which we all live, while the workers who produce some particular commodity may, by their

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combined pressure, succeed in apparently making themselves better off, if the only result is to force up also the price of other commodities which they and their families wish to buy, the advantages which they gain will be largely illusory. That is a truism which is not generally recognised. Yet it is absolutely essential that it should be recognised if we are to have continued peace and harmony in industry. The real difficulty, as I see it, is how to get this type of fact across to the man who for this purpose really matters—by which I mean the man at the bench, the man in the workshop, the man on the footplate and so on.
The main weakness I suggest, with all deference, of many of the schemes which have been recommended to us this afternoon—economic councils, joint advisory councils and so on—is that they aim at tackling this job at far too high a level. It is not the distinguished members of bodies of this kind who have to be convinced. The men who take part in discussions at that level on both sides are already converted: they know these simple fundamental facts. What we have to try to do is to get at the men lower down. There, I suggest, in this slow patient process of education the trade unions and their leaders have an essential part to play. I feel that they have an immense responsibility coming upon them, in the years that lie immediately ahead of us, to give wise counsel, as indeed a great many of their leaders already do. We all know many cases of men of great moral fibre who are always giving counsel to their people, even though it may be unpopular. I am not suggesting that it is not done at the moment, but I say that it must be continued and extended, for, after all, they, and only they, are in a position to put across to their members the truth of the harsh modern world in which we live. They alone are in a position to draw the right lesson from the fuller information which we hope the managements are going to put out in all forms and industries; and they alone are in a position to convince the workpeople of this country that in the modern world we simply cannot afford disputes such as those which we have recently been experiencing; that our prosperity, to repeat a graphic phrase used here a short time ago and repeated to-day, is really
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balanced on a razor edge and can be maintained only if we find means of producing more at the same cost.
By that I do not mean that the British workman should work harder. In the vast majority of cases, as noble Lords know, and as the noble Lord, Lord Bennett of Edgbaston, said, they are already working very hard, and with the skill that they have always shown. I mean rather that they and we must take advantage of every new facility which science now puts before us, whether it be work study, man management—to which the noble Viscount, Lord Bridge-man, referred—or automation, a word which has also cropped up in these discussions. We must take advantage of anything which may help the individual workman, in the same time and by the same effort, to produce more than he did before.
As the noble Lord, Lord Macdonald of Gwaenysgor, said in his speech, there is nothing new or necessarily disturbing about such things as automation: they are merely a further extension of that mechanisation of industry which was, perhaps, the main feature of the Industrial Revolution of the nineteenth century. As we all know, that mechanisation has, over the period of the last 100 or 150 years, enabled this country to carry a far larger working population at a far higher standard of living than they enjoyed before. Similarly to-day, with these new inventions which are coming before us, industry itself has changed, and is changing more. There is much more diversity and complexity; diversity of product and of process; and much greater specialisation of functions. Whereas in the past there was the simple structure of managers, foremen and workers, these groups are now themselves divided, subdivided and again subdivided. There are general managers, engineers, chemists, accountants, personnel managers. The foreman finds himself alongside functional specialists of all kinds—inspectors, work study men, quality control staff and others. The new industries and new processes which are being used in the old industries call for new skills and new crafts at the craftsman level; as well as the old carpenters and fitters, there are chemical process workers, craftsmen in electronics and instrument makers; and more men are needed with

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high-grade skills, while at the same time new semi-skilled occupations, such as tending semi-automatic machines, have arisen.
There is, too, greater diversity of unskilled work. The old picture of large groups of fairly comparable and interchangeable people in industry who could be dealt with en bloc is, as noble Lords will know, becoming much less representative. Moreover, the character of the jobs themselves is tending to be changed at an ever-increasing rate by technological developments in industry, and this complexity inevitably brings with it greater interdependence, and greater sensitivity to disturbance. All that means, as the noble Lord, Lord Lucas of Chilworth, has rightly emphasised, that the future opportunities before is are unlimited provided that we are ready to grasp them, and, I think the noble Lord said, provided that we do not try to freeze our industrial structure into its present form; and I would add, also, provided that we do not try to cling to old ideas, old prejudices and old bitternesses. But, equally, it means that we can probably afford less now than ever before in our history to quarrel among ourselves at this crucial moment, or to waste our time, effort and money in such internecine quarrels as we have lately seen. If we were to do that, we should, I am sure the noble Lord, Lord Lucas of Chilworth, will agree (although he did not like the expression), price ourselves out of existence in competition with our foreign competitors. That is the lesson of the recent disputes, and is, I believe, the lesson to be drawn from this most valuable debate. The writing is on the wall. It is not too much to say that it is for us to read it or perish.
7.24 p.m.
LORD AMWELL: My Lords, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

MISCELLANEOUS FINANCIAL PROVISIONS BILL
Brought from the Commons endorsed with a Certificate from the Speaker that the Bill is a Money ill, within the meaning of the Parliament Act, 1911; read 1a. and to be printed.
FOOD AND DRUGS BILL [H.L.]
Reported from the joint Committee on Consolidation Bills, with Amendments, and recommitted to a Committee of the Whole House.
BOURNEMOUTH CORPORATION (TROLLEY VEHICLES) PROVISIONAL ORDER BILL DONCASTER CORPORATION (TROLLEY VEHICLES) PROVISIONAL ORDER BILL
Reported, without amendment, and recommitted to a Committee of the Whole House.
  DIPLOMATIC PRIVILEGES AND IMMUNITIES
  DIPLOMATIC PRIVILEGES AND IMMUNITIES