Anglo-Soviet Treaty.

Orders of the Day — Consolidated Fund (Appropriation) Bill. – in the House of Commons on 6th August 1924.

Alert me about debates like this

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I must apologise to the House for not having the White Paper which was promised by the Prime Minister before this discussion took place, but the circumstances in which I have been working have been rather unusual, and I could not get the Paper prepared in time, the reason being that negotiations between the two delegations have been continued within the last 24 hours, and a settlement was finally reached at half past three to-day. It has been a race against time, because I was very anxious that the settlement should be announced to the House before its rising for the Session, and I was also anxious that the House should have an opportunity of examining the Treaty before the Recess. I must again apologise that this intention has been frustrated, but hon. Members will remember that we have laid down the principle that treaties must lay on the Table of the House for 21 Parliamentary days before ratification. Therefore there will be the opportunity in the 20 days in the next Session before ratification if a discussion is desired.

This conference has taken about three and a-half months, and has been conducted throughout in a spirit of friendliness. Perhaps the method which I have found it right to adopt has not always been very orthodox, but I think most people will agree that if we can get closer to an understanding by private conversations rather than by formal conferences, you have every right to adopt that method of procedure; and it has been to a large extent by conversations that many of the outstanding features have gradually been dealt with. At the same time we have had sub-committees working indefatigably during these months at the detail which was necessary for framing the various parts of the Treaty.

Of all the difficult problems with which we found ourselves confronted when we came into office, I doubt if there was one more difficult than the relations between Russia and Great Britain. To begin with, there was the War in which we were allies together. Then there was the outbreak of the Russian revolution. Then there was the long period of the non-interventionist policy, and meanwhile in Russia they had been fighting, not only their foes that surrounded them, but other and perhaps even more desperate enemies, such as famine. The formation of the new system in Russia brought about a state of affairs which made their political and economic life different from that of Western Europe. Then, a degree of animosity and prejudice was engendered against the Soviet regime, which I think is almost unequalled in the feelings displayed in this country against any other country.

Photo of Mr Henry Croft Mr Henry Croft , Bournemouth

He is referring to Mrs. Snowden.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

For some time past I have always been interested to read and believe in letters and articles and speeches about various countries in Europe, but when I have seen paragraphs, speeches and letters about what is taking place in Soviet Russia, experience has taught me that they are not to be relied on. Whether it be in one direction or in another direction, the degree of animosity and prejudice has been so great that it has been impossible to get any authentic information from that part of the world. During this time, the relations between the two countries had not only been strained but broken, and they continued to be broken for a number of years. At the same time when I found myself confronted with the task of trying to adjust these differences, and to knot together the broken strands of the rope, I found that the two systems in many ways have conflicting notions. I have had to steer my ship very carefully between the two rocks on either side. I have been accused of being in the pockets of the Bolshevists, and I have been accused of being in the pockets of the official experts. I have a natural abhorrence of being in anybody's pocket, and I think the result will show that I have taken the line which is likely to lead to the very best result for both countries.

In entering into these negotiations, we of the British Delegation did not do so desiring to take any advantage of or to corner or trip the Soviet delegates, or in any way to steal a march on them, but rather to represent legitimate British interests, and to encourage the Soviet Government to show themselves worthy of our confidence, and, therefore, of the confidence of the world. Without a Paper before the House, it would obviously be wrong of me to enter into any detailed technical point, but I want to give the House as full an account as I can of the agreement that has been reached.

There is a commercial Treaty, which is a separate document, and there is a general Treaty which has also been agreed upon. With regard to the commercial Treaty, it follows the usual lines of commercial treaties. There are one or two points in it of which I may tell the House, and which, I think, will be regarded as satisfactory. We have received unconditional most-favoured nation treatment for our goods, and in return for that we have admitted the Soviet Union into the Export Credit Scheme. In another article there are full navigation provisions, and there is most-favoured nation treatment for our coastal trade. There is an important Clause with regard to arbitration in contracts, and there are all the other usual Clauses which occur in commercial treaties. I think, perhaps, I ought to note one rather unusual Clause which is likely to be the subject of discussion. At the beginning of the Treaty, in the Second Article, we take into account the Soviet Union monopoly of foreign trade, and we grant to a small number of the Trade Delegation diplomatic immunity for themselves and for the existing office of the Trade Delegation.

This is an unusual departure, in fact, it is a new departure. If a Labour Government does not make a new departure nobody else will. So far as we are concerned in the agreement both with Italy and Germany there is a similar Clause, although it is not so confined. Both in the German and the Italian Agreements there was a Clause which extended this immunity very much further than we have done in the Second Clause of our Treaty. After all we were prepared to admit that the Soviet Union has a monopoly of trade as traders, and we have given them this very restricted privilege.

Now I come to the general Treaty in which there is to begin with a recital of the various treaties that existed between the former Russian Government and this country, and there we find enumerated those which have lapsed, and these is a small number being renewed. There are some which may require revision but those are the bi-lateral treaties. With regard to the multi-lateral treaties it was obvious that we could not deal with them because you could not deal with such treaties without having the consent of the other signatories. There were certain multi-lateral treaties which could be renewed by a bi-lateral agreement between the two countries, and wherever this was possible it has been done. They are mostly technical conventions, protocols, and declarations.

The Treaty then goes on to make provision for a Fisheries Agreement. The question of the definition of territorial waters, of course, must be left over until we get an international agreement an that point. You cannot get a bi-lateral arrangement on this question, but it is important that we should get a satisfactory fisheries agreement, and this has been done. I will mention one point. The line which has been agreed to in the White Sea and the entrance to it is parallel of latitude 67–40, which satisfies our experts, and I think will be satisfactory to our fishermen.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

Can the Under-Secretary say, roughly, how many miles that line will be from the shore?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

That is difficult to define, because it is in the narrow neck of the White Sea which extends out a great deal, and the line is across the narrow part. The discussion always has been whether it should be beyond the natural coastal line of latitude 69 or whether it should be right down into the channel which leads to the White Sea in latitude 67. This is an arrangement which falls between the two.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

Does this not mean that our fishermen will be excluded from the area in which they have considered themselves entitled to fish?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I do not think that is the case at all. I come now to the part of the Treaty about which interest naturally concentrates chiefly, and that is the whole question of the debts and claims. I need hardly say that it is this part of the work that has occupied our attention mostly during three-and-a-half months. There are three classes of claims. In the first place there is the bondholder; secondly, claims that come under the miscellaneous category, and lastly the property claims. We had to consider a decree of repudiation on the part of the Soviet Government of these claims, and also a decree of nationalisation, and while we had to see that British interests were safeguarded, our task was to do nothing to interfere or to express any opinion on the Soviet laws and decrees.

On this matter I think I shall certainly carry my hon. Friends behind me with me when I say that our contention has always been that whatever opinion we might have of Soviet institutions or the Soviet system it was no business of ours. After all they are attempting rather swiftly a great experiment. They may succeed or they may fail. [An HON. MEMBER: "They have failed!"] Of course every new experiment is laughed at by those people who are incapable of making any experiment themselves. The course of history shows that sometimes such experiments may gradually go through a phase of alteration, and ultimately settle down for the benefit of those for whom they are devised. At any rate it is not our intention to criticise or to come up against the Soviet decrees and laws. At the same time we were determined that the legitimate rights of British citizens should be recognised.

With regard to the bondholders, when I was addressing the House on this subject before, I was not able to do anything but make an apology for the long duration of these negotiations and I spoke of some of the difficulties we had encountered in getting the bondholders to express themselves.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I do not think so, but we found some difficulty in finding anybody who was authorised to speak on behalf of all the bondholders. They are a large number of people, and their interests cannot very well be represented by a committee. We have got in Article 6 an admission of liability from the Soviet Government, and an assurance on their part that they will negotiate with the bondholders. [An HON. MEMBER " Will they pay them?"] I believe they are in process of doing so with a very considerable number of them.

Photo of Mr Fredric Wise Mr Fredric Wise , Ilford

Does that include the Government loans?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

No, I am speaking only of the private bondholders. In dealing with a large country like Russia I think it ill becomes us in dealing with a very great people, whenever they are mentioned, to deride them. Hon. Members opposite may very likely answer me by saying that they use very abusive language about His Majesty's Government, but my experience is that when people scoff and abuse me it is all the more incumbent on me to behave like a gentleman.

Photo of Mr John Whitley Mr John Whitley , Halifax

It would be very much better if hon. Members would put their questions afterwards, and not interrupt.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I will do my best to make the point clear, and I will refer to the settlement with the bondholders in a moment. With regard to the miscellaneous claims, there is to be an arrangement by which those claims shall be investigated and a lump sum decided upon. With regard to the property claims, over these we had perhaps the greatest difficulty. Both sides are to appoint members on a committee, which will investigate the claims and come to a decision as to compensation. I will tell of all these three sets of claims in a different way. The principle that we have adopted in this Treaty has been not to attempt to reach a settlement in figures on these classes of claims but, rather, to get a decision in principle and to get machinery set up with a view to reaching the necessary settlement. We started by attempting to get figures, but we found that it was a very difficult task, and, finally, that it would probably prolong our discussion for a further considerable time. We thought, therefore, that it was very much better to get the machinery and method arranged as a first step, and, as hon. Members will see in a moment, this Treaty is in itself a first step. When one part at least of the bondholders are satisfied with the terms reached, when His Majesty's Government are satisfied with the lump sum reached as a settlement of the miscellaneous claims, and when there is an agreed settlement with regard to the property claims, then these agreements will be embodied in a subsequent Treaty, and, arising out of that Treaty, the Government will submit to Parliament a proposal guaranteeing a loan to the Soviet Government.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

Does that settlement include both the sterling and the rouble bonds?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I am at a disadvantage, because even I have not got a copy of the final documents. [An HON. MEMBER: "Has anyone?"] I will give the right hon. Gentleman an answer to-morrow. Let me give the House more clearly an account of the procedure which will be adopted, so as to show how Parliament is safeguarded. This Treaty, which I hope will be signed to-morrow, will remain on the Table of the House for 21 Parliamentary days, so that there will be an opportunity for detailed discussion, if necessary, before ratification. After that, agreements have to be reached on all these different categories of debts and claims. When agreement is reached on those, a second Treaty will be introduced. That, of course, will be subject also to being laid on the Table of the House for 21 days, and, arising out of that, there will be a Financial Resolution and a Bill for the loan which will go through all its stages

Photo of Mr Worthington Evans Mr Worthington Evans , Colchester

Can the hon. Gentleman state the amount of the contemplated loan?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

No; that has naturally to be decided after these agreements have been reached.

Photo of Mr Worthington Evans Mr Worthington Evans , Colchester

We are not pledged in any way to any amount?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

No, there is absolutely no pledge as to the conditions, or the amount of the loan. That is to be decided after the agreements have been reached. I have still two important points. One concerns the Government debts and the other the claims, the interventionist claims. With regard to the latter, His Majesty's Government and the Labour party are in a different position from hon. Members opposite. Hon. Members opposite were supporters of the interventionist policy, and my hon. Friends behind me have consistently, ever since it was inaugurated, denounced and repudiated it. But the claims that were put in under that heading were naturally of such a character as to bear no sort of financial or economic analysis. They can hardly be treated as a financial matter at all. Really, it is much more of a political contention on the part of the Soviet Union. But both the Government debts and the interventionist claims are set aside in Article 9, for the time being; they are, if I may use the expression, put into cold storage. [HON. MEMBERS: "Frozen!" Another point which I may refer to, and which I know will be of interest to hon. Members opposite, is the question of propaganda. We have inserted a Clause with regard to propaganda which resembles to a large extent the propaganda Clause in the Trade Agreement, but in some respects it is even more severe.

8.0 P. M.

Beyond the question of debts are some minor matters with which I do not think I ought to trouble the House, especially as they have been alluded to before. It is undoubtedly the question of these debts and claims that is of importance. We had the alternative before us of wrangling and disputing and investigating for a very protracted length of time, or else doing our best to come to some form of agreement by which liability would be declared, and by which there would be, not only a reasonable prospect of a settlement, but a very strong inducement for a settlement. This, I think, we have succeeded in doing. Our attitude—and I am certainly not ashamed of it—towards the Soviet Government and the Russian people has been from the outset absolutely consistent. We had hardly been a fortnight in office before we did an act which was condemned very strongly by hon. Members opposite. That was the recognition of the Soviet Government. We feel that when you have a dispute with a man, and you go to him and say, "Before I shake hands with you, we must settle this matter," your conversations are likely to last a very long time, whereas if you go up to the man and you shake his hand first, and then say, "Now let us get to a settlement," you are likely to reach your settlement very much quicker. The course we took then in that Act of recognition is justified by the fact that we have been able in such a very short time to get this agreement. [An HON. MEMBER: "What have you got? What does it amount to?"] The claimants will find that they will get—[HON. MEMBERS: "What? At our expense!"] If they do not, then the subsequent Treaty will not materialise. I think the Act of recognition was a right move, and I again say it was consistent with the policy always adopted by the Labour party not to give the flabby handshake of patronage, but the firm grip of friendship. I fully admit that the House is very much at a disadvantage in not having the White Paper, and I hope it will not entirely blame me, because these negotiations have been protracted to almost the last moment, and it was a physical impossibility to prepare it. I should like to say that throughout I have been supported by colleagues whose expert knowledge has made up for my own palpably ineffective equipment; and they have not only shown mental agility, but also physical endurance. I was fully prepared for the mental strain of such a Conference, but I did not quite understand that it was going to involve such a physical strain. I must say that, one and all, they have given once more a proof of the exceptionally high quality of our Civil Service. I should like to add one other word, namely, that throughout I have found, in the leader of the Russian Delegation, M. Rakovsky, a friendly disposition, an accommodating desire, and an intense wish to reach a settlement, and I am indebted to him for help on many occasions in steering round some very difficult corners. The fact that hon. Members will attack this Agreement now and when they read it does not, in my mind, detract from the goodness of it, and I believe that those who understand how necessary it is that the sores in Europe should be healed as soon as possible will mitigate their criticism a good deal. I believe that this Treaty which it is my privilege to announce to the House to-day is an instance of the method in our international relations which has been laid down by my right hon. Friend the Prime Minister, that is to say, to avoid acrimonious discussions over petty points and quarrelling over detached issues, and to seek a general settlement on broad lines based on conciliation and co-operation, and by this means to do our share to help to restore to Europe and the world friendly relations and hopes of recovery, and to make the peoples in Europe feel that at last Governments are using their power and their authority, not always for warlike operations, but for the establishment of peace and brotherhood, not only in theory, but in practice.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

There were cheers from hon. Gentlemen opposite when my hon. Friend got up to make his statement. Had those cheers been merely to express sympathy with him in having brought to a conclusion a very onerous task, or at all events having brought it to a pause, I should have been very glad to have joined in them, but I am afraid that that must be the limit of my sympathy. I must repeat the complaint which I made on the last occasion when we had to discuss this matter. The hon. Gentleman and those who sit with him and behind him certainly will not contend, I am sure, that the announcement that he has made is one of little importance, or that there is little importance to be attached to the work upon which he has been engaged. I have every reason for thinking that it is less important than at one time I anticipated, but still, there is no doubt that these negotiations which have been going on for four months with the representatives of Russia are a very important matter, and on no occasion have we had the Secretary of State for Foreign Affairs, on no occasion have we had the Prime Minister, as the representative of the Government, to explain, with the authority which he alone can wield, what is proposed and what is being done. I do not by any means share the complete scorn of Under-Secretaries that characterises the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George). He told us on one occasion the principles that guided him in such appointments. But, however that may be, I do think that, important as the Under-Secretary's position may be, and notwithstanding the engagements which the Prime Minister has, we ought to have had him here, either to-day or before we are called upon to make a decision.

I want at the very outset to protest against the procedure which is being followed, so far as I can understand the intentions of the Government. The hon. Gentleman has apologised to us for not having put in our hands the White Paper and the Treaty which is the basis of this discussion, and he asked for indulgence for himself because it had not been presented. I am sure that the House is quite willing to make every possible allowance both for him and for the difficult circumstances which have made it impossible to produce that White Paper now, but that ought not to affect the rights of the House, and it ought not in any way to preclude the House from having the fullest possible opportunity for discussing this Treaty. An hon. Member says, "It will have." I hope it will, but it does not appear so from the statement of my hon. Friend. The procedure is, as I understand it, that this Treaty is to be signed to-morrow, and, if I am right in understanding that, it is a distinct breach of pledge. It is a distinct breach of the clearest possible understanding, and I shall protest against it as strongly as possible, as I shall show in a moment.

The Treaty, as I understand, is to be signed to-morrow, and then it is to lie upon the Table of the House for 21 Parliamentary days—that is, as we learn this afternoon, after the 28th or 29th September; and during those 21 days, so far as we can anticipate, the time of the House under the disposition of the Government will be very fully occupied in debating the Irish proposals which the Government are going to bring forward. I want to call the attention of my hon. Friend to the language which he used on this point, because we have been very anxious about the matter. On the 7th July, one of my right hon. Friends asked a question of the hon. Gentleman: Are we to understand that if this Commercial Treaty is made, all rights we may possess under Article 10"— that is, of the Trade Agreement— will be given up, and no compensation will be available for any British subject? I may say in passing that we have heard nothing on that very important point about Article 10, and I shall ask the hon. Gentleman later about it, but for the moment I am calling attention to this. His reply to my right hon. Friend's question was as follows: All these matters are closely knit together, and I cannot go into the various details now. That is to say, he gave no answer on that point. He continued: I want to assure the Leader of the Opposition that this agreement"— that is, the one which he is now signing— line by line and word by word, will be laid before the House, and there will be full discussion upon it."—[OFFICIAL REPORT, 7th July, 1924; col. 1919, Vol. 175.] [HON. MEMBERS: "Hear, hear!"] The cheers of hon. Gentlemen opposite cannot disguise the fact that, whereas that was a distinct promise that this would be discussed line by line and word by word, before it was signed by the Government—[HON. MEMBERS: "No, no!"]

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I am sure the right hon. Gentleman will forgive me, but I never said "before it was signed by the Government." I am sure that the right hon. Gentleman in his experience has never come across an instance in which a treaty was presented to Parliament before it was signed. Between signature and ratification is the opportunity for Parliament to discuss it, and His Majesty's present Government have laid down that principle.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

I do not think that what I have already read needs any reinforcement, but this is what the hon. Gentleman said on an earlier occasion when he was asked by my right hon. Friend the Member for Chelsea (Sir S. Hoare): Will the Government undertake to enter into no Treaty until this House has had an opportunity of discussing it?Mr. PONSONBY: Certainly, Sir."—[OFFICIAL REPORT, 24th July, 1924; col. 1518, Vol. 176.]

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

- I must really emphasise the fact that you do not enter into a treaty of engagement until your treaty is ratified. My right hon. Friend, as an expert on these matters, surely knows that there is no precedent whatever for a treaty being discussed in this House before it has been signed.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

I am quite content to leave the matter there. If the hon. Gentleman really thinks that what he is now doing is a fulfilment of these pledges which I have quoted to the House, I can, of course, say nothing else than that I heartily disagree with him.

I do not intend to follow the hon. Gentleman in a good deal of what he said. I do not think we need concern ourselves very much with what he said about the prejudice against the Soviet Government which he said is very common; nor was it at all necessary for him to assure us that he himself was not in the Soviet pocket. I think he is much more likely to be in their heart than in their pocket. But the hon. Gentleman—and here I must insist upon correcting him—has done what is so constantly being done among hon. Gentlemen opposite when they are speaking of the views which we hold on this side of the House with regard to Russia. We hold certain very strong views with regard to the small oligarchy, whom we regard with utter detestation, and all their methods; but that does not mean that we have anything but the highest possible esteem and regard and sympathy for the Russian people; and we have that sympathy for this very plain reason, that we know very well that they are the people who suffer most.

When the hon. Gentleman said that he was guided by the principle, during these negotiations, that the laws and decrees of Russia are no concern of ours, as a general principle I entirely agree with him. They are no concern of ours, with this exception, that, if we are to enter into trade relations with Russia, and especially if Russia is to have financial advantages from us, then it does become a matter of prime importance to see whether the decrees and laws of Russia, and the institutions of Russia, are or are not such as give ordinary protection to life and property. I need hardly remind the hon. Gentleman, who gave such a very high testimonial to those with whom he was negotiating, that the Prime Minister himself anticipated the course of the negotiations by saying, and it was a very wise thing to say, that he was not going to be misled by any monkey tricks of the Russian negotiators—rather a strange phrase to use towards the diplomatic representatives of a friendly Power with whom he was about to enter into negotiations. At all events, he showed that the Prime Minister, whatever the Under-Secretary may feel, was under no delusion whatever about the people with whom he had to negotiate.

There was one special point with which the hon. Gentleman has dealt which appears to me to be really of central importance in the whole matter, and that is when he says this Government is going under certain conditions to guarantee a loan to the Soviet Government. Here again I am obliged to say that to do so appears to me to be a most complete violation of a Parliamentary pledge given over and over again. On 5th March the Prime Minister was asked: Whether the Government have given any guarantee under the Trade Facilities Act or the Overseas Credits Acts in connection with the promotion of trade with Russia; and, if so, of what nature?The PRIME MINISTER: The answer is in the negative."—[OFFICIAL REPORT, 5th March, 1924; col. 1426, Vol. 170.] That, of course, is not inconsistent with what has been done, but on 18th June the Prime Minister was asked whether the Government has considered or proposes to consider the guarantee of any Russian obligation?The PRIME MINISTER: The answer is in the negative. Of course, the Prime Minister and the Government are perfectly entitled, if they like, to change their minds from time to time, but having given such a very specific and explicit pledge no longer ago than 18th June, I am surprised that they should have so rapidly changed their mind and should not have thought it right to give any notice to the House that they did so. On 30th June another Member asked the Prime Minister: Whether any, and if so what, progress has been made in the negotiations between the British and Soviet delegates who have been in conference in London for nearly three months and whether the Government has rendered any assistance in the matter of raising a loan in this country for the Moscow Government, and, if so, what is the nature of that assistance? The Prime Minister replied: I have undertaken to make a full statement to the House when negotiations have reached a stage which justifies my reporting to Parliament upon them. As regards the question of a loan, there is nothing to add to the reply which was given to a question by the hon. Member for Epping on 18th June, and to the hon. Member for Kingston-upon-Hull on 25th June. That was the two explicit statements I have just read to the House that the idea of guaranteeing a loan was not contemplated. As there has been such a distinct departure from these assurances, it is important that we should know exactly what has been said. A Member of the party opposite on 23rd June asked: If steps will be taken to expedite the arrangement of such a loan with the utmost urgency. Again the Prime Minister replied by referring him to the previous answers already given. On 20th May an official communique was issued from the Foreign Office, from which I should like to read a few words. The British delegation said it would be necessary to examine the Soviet proposals more closely before pronouncing upon them, but that it should be understood at once that any assistance which the British Government could give towards the floating of a loan would of necessity be very much limited and that there could be no question of any Government guarantee. The delegation repeated that any guarantee by the Government was out of the question. They felt that too much importance might easily be attached to the necessity for a guarantee. They hoped the Soviet Government would find no difficulty in raising the money. So that throughout all this period, both by an official communique from the Foreign Office, not pressed by any Member in the House, and by questions put in the House over and over again, we had the most definite assurances that the idea of guaranteeing a loan for the Russian Government was not in contemplation and was out of the question. Now when the House is within an hour or two of separating for months, and at this very inconvenient hour of the day, the hon. Gentleman is sent down here by the Prime Minister to tell us that a Treaty will be signed to-morrow which absolutely violates all these assurances.

The hon. Gentleman has told us, truly, that the really important matter of his negotiation was the question of debts and claims. I wonder whether any Member of the House has really gathered any clear idea of what is proposed to be done, more than it has been at any time in the last two or three years, with regard to these matters. As far as I was able to follow the Under-Secretary, all that is arranged is that they have agreed to negotiate with the Government. [HON. MEMBERS: "Why not?"] There is no reason why they should not have done so at any time. I do not want to detract from the hon. Gentleman's achievement, but to sit for four months carrying out the most onerous negotiations, the whole country expectant as to what was to come out of them, and you have this great achievement that the Soviet Government and the bondholders have undertaken to negotiate. Take the question of the miscellaneous claims. What has been done about that? The hon. Gentleman said it had been arranged that a lump sum was to be paid. I thought his next sentence would be to tell us what the lump sum was in order that we might form some idea whether it was a fair settlement of the claims put forward, but not at all. He does not know what the sum is.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

No, nor the claims. The hon. Member has most kindly brought out my point that nothing has been done. It is exactly as it was before. No one knows what the Soviet Government are prepared to offer. Moreover we have not been told by whom the lump sum is to be decided. A Government that has been so busy in framing all sorts of schemes of arbitration for deciding every dispute between one country and another might have thought of some method by which, in the event of ultimate disagreement between the claimants and the Soviet Government, it might have been decided by arbitration or otherwise what this lump sum should be. There is only one thing which, as far as I can see, really shows that something has been done. I gathered from the Under-Secretary that in Article 6 there is an admission of liability by the Soviet Government, but an admission of liability in regard to what I was not able to gather. An admission of liability at all is worth something; but it would be worth a great deal more if it were not for the fact that everything about which liability is admitted is hung up for future negotiation and decision by the parties concerned.

Photo of Mr John Mills Mr John Mills , Dartford

Like the French business.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

I agree that there are many other things which are open to the same observation, but the Under-Secretary came here prepared to make a statement about the result of his negotiations. I must express my very great disappointment that the result is so insidious, and that it is so vague and uncertain in its manner and procedure. When we come to the actual contents of the Treaty which is, apparently, to be signed to-morrow, it is all hanging on future negotiations and on something which is to be subsequently put into a second Treaty.

Having regard to all the proceedings that have been going on, I can only draw one conclusion. Last night, the final communique issued from the Foreign Office stated— As the Soviet delegation was unable to accept the amendments and concessions offered in regard to Article No. 14 of the draft Treaty, no agreement was reached, negotiations broke down, and the Treaty will not be signed. I think that tells us a good deal. What really happened? The negotiations were at an end, and the Government felt that after four months of the fruits of their recognition of the Soviet Government they had nothing to show either to Parliament or the country. The Under-Secretary tells us that they only arrived at some agreement this afternoon. What happened after that communique was issued from the Foreign Office? I think it speaks of panic. The Prime Minister told us yesterday in regard to another matter that he was not the man who would sign a midnight treaty. What happened after the communique was issued from the Foreign Office? I wonder if this is what happened. The Under-Secretary running about all night, going to the telephone at two o'clock, is in a desperate panic for fear he should have to meet the House of Commons this afternoon and to say that nothing had been done. So he goes back to the Foreign Office and gets Mr. Rakowsky and brings back the Russian delegates, and after lunch he manages to get them to sign an agreement that at some future date they will negotiate it all over again and put the result in a second Treaty. "With that," he said, "at any rate, I can go down to the House of Commons and say that we have done something."

I consider the whole thing an utter farce. I would be perfectly willing to join with the rest of the House in laughing at what certainly is in many of its aspects an extreme comedy, if I did not think that in regard to one important aspect, provision for or even hinting at our guaranteeing of a loan, it is not a comedy but a scandal. The Under-Secretary told us that the Government had started by recognising the Soviet Government, and he explained to us his ethics of recognition and the different species of handshakes. There are two ways in which you can approach the question of recognition of such a Government as the Soviet Government. One is to say to them, "Show yourselves honest, and we will recognise you." That is the principle upon which we on this side of the House proceed. That does not in the least mean, "Form your institutions on the lines that we like." It simply means "Show yourselves an ordinary honest Government, a Government with whom we can do business, a Government we can believe, and then we will recognise you."

The present Government went on a totally different principle. They said, "We will recognise you, and we hope that you will prove honest afterwards." They were not honest then, as the opinion of the Prime Minister has clearly shown from the quotation that I have read from his warning. On another occasion he said that those who supped with the Russians must have a very long spoon. Our view in regard to this projected loan is that Russian credit is not good enough to make it possible for this country to guarantee the loan. We do not believe that such a loan will be raised, even with such a guarantee. We say that if a loan is to be raised for Russia, there is only one principle and one method by which it can be done.

If Russia require a loan to be guaranteed by a foreign Government, it can only be because her financial position does not admit of her stabilising herself and recovering her prosperity. There have been other cases where the same thing was true. It was done in the case of Austria and Hungary. The procedure adopted in those cases was to use the machinery of the League of Nations, and when that machinery was put in operation to exercise very close supervision, if not control, over the financial arrangements of the country enjoying that guarantee. If that method were pursued in this case, and if it were necessary for the sake of the economic position of Russia to do what was done in other countries in Central Europe, at all events it would be worth consideration whether we should not join in trying to stabilise an economic Russia upon those lines. But that is something very different from what the Government are doing.

I go so far as to say that it might be positively mischievous from our own point of view if this loan guaranteed by the Government were to materialise, because, as the Financial Secretary to the Treasury knows very well, the available funds for loan purposes, whether to foreign nations or for any other purpose, is a limited quantity. I am not a financial expert, and do not pretend to be, and I do not know what the surplus funds at the disposal of this country in the money market may be at any one time, but I believe they are not anything very enormous at the present time. There are very large requirements for capital to be advanced for our Dominions, and trade in our own country is always requiring a large quantity of investment. As we all know, a loan of £40,000,000 is to be raised for Germany under the Dawes scheme, in which, of course, we shall bear some share. Under the circumstances, I doubt very much whether, from the point of view of our own financial and economic situation, it might not be positively mischievous to us if the guarantee of the Government, as presumably it would, were to draw from the money market of this country a large sum—we have not been told what the sum is, but, presumably, it will be a large sum—and to draw it from the pool out of which capital investments must be drawn. Therefore, we on this side of the House strongly object. We are quite willing to consider, when the time comes, the other proposals, shadowy as they are, but I think I am justified in saying that we on this side will most strenuously oppose the guaranteeing of any loan to Soviet Russia, in spite of the assurances which have been given over and over again, and we shall denounce it whenever it is brought forward. The Government must not assume—they have now two months before the House will meet again—and they must not represent to the negotiators on behalf of Russia that it is a fait accompli or an honourable understanding which the House of Commons is bound to observe. We give the fullest notice which we can now that if this proposal is carried out we shall denounce it in this House whenever we get an opportunity, and we shall denounce it in every part of the country.

Mr. LLOYD GEORGE:

I rise to ask for information from the Under-Secretary for Foreign Affairs rather than to express any definite opinion, because I find it very difficult to express a definite opinion on something which certainly I do not quite understand from the statement made by the hon. Gentleman. I am not imputing any want of care on his part, but I quite realise that the circumstances in which he entered into this agreement were such that he has hardly had time to master it himself. Therefore it was not very easy for him to explain it to the House. The first question which I wish to ask is—why should he not follow the precedent set by the Prime Minister, in communicating to the Press to-night the agreement at which he has arrived although he has not signed it? On Monday there appeared in the newspapers of this country a very long document giving the provisional arrangement made between the Government and the Allies. The Prime Minister said here, "I have not signed it. It has to be revised by my legal experts, and I will not sign it unless I am satisfied on two or three very important matters." Why should not that course have been pursued here? Why should not we get at any rate one day when we can examine these proposals? The hon. Member will admit himself that the statement which he has made in not a very full one. It is a very vital thing to which he is inviting this House and the country to assent. It is very far reaching, and it ought to be explained in very great detail.

Mr. LLOYD GEORGE:

We will not get that White Paper in time to examine it for the discussion. It is no more important than the arrangement with Germany and the whole of our Allies. That was published in the Press. If we could get it the first thing in the morning we should have an opportunity of examining it, but it is impossible to comment upon the incomplete and inadequate statement which we have heard. I am not using the word "inadequate" as a criticism of the hon. Member's speech, but rather from the point of view of the inadequacy of the explanation to the House of one of the most important decisions ever taken by this Government. May I point out the risk of it? It is all very well for the hon. Gentleman to say "The Treaty has to lie on the Table of the House for 21 days and the House can reject it." It is a very serious thing for the House of Commons to take the step of rejecting a Treaty which has been signed by any Government, even Treaties which they do not quite like. Even in the case of Treaties like the Treaty of Versailles there was a full discussion, but here you are postponing the discussion until possibly the end of September or possibly November. It might easily go into December. What happens? This thing will be regarded, not so much here as in Russia, as an agreement entered into by which certain most important concessions—and I will point out how important they are—have been made to the Soviet Government.

The hon. Gentleman—I am not complaining of it; other people have done that in the past—was making an appeal to his friends behind and showing how he carried out their ideas, but the Soviet Government will do exactly the same thing in Russia. To-morrow in their newspapers there will be a declaration of what triumphant terms they have had from the British Government, and there will be the same sort of compliments paid to their representatives as those which have been paid here to the hon. Gentleman. They will say "Thanks to Mr. Rakovsky's great skill, thanks to Mr. So-and-So, we have got these things," and then three months afterwards the thing is torn up by the House of Commons. It will look to them like a repudiation of a bargain entered into by the British Government. I do not say that we will quarrel with the Soviet Government. Hon. Members on either side of the House have certainly no quarrel with the Russian people. No people suffered as much from the War as the Russian people. Their casualties were infinitely greater than those of any other of our Allies in that great struggle. So therefore we have no quarrel with them. But let us be quite frank. The hon. Gentleman has a great admiration for the Soviet Government, but one thing which the Soviet Government has never claimed is that it is a representative Government. Its claim is practically the same claim as that of the Tsars—that it has a sort of divine right. Mr. Lenin always frankly expressed his contempt for democracy. Therefore, so far as the Russian people are concerned, we do not want to make them feel that the people of this country have permitted their Government to enter into a bargain, and three months afterwards have torn it to pieces. It is difficult to explain to them, for their Press in this land of the free which the hon. Gentleman has been lauding—

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

May I correct my right hon. Friend. I never expressed any admiration for the Soviet Government, nor do I laud the Soviet system. I think that it is deplorably bad.

Mr. LLOYD GEORGE:

That is worth eliciting, but whenever we made any mild criticism we were always attacked on that ground. I am not at all sure that I could not cull from the speech of the hon. Gentleman phrases in which he denounced us for our criticism of the Soviet Government. Amongst the things that make it so bad is that there is no free expression of opinion allowed there. The news in the Socialist republic—[HON. MEMBERS: "It is not a Socialist republic"!]—I will say in this collectivist community, is only allowed to be the news which has passed through a very stern censorship. Such a report as is published in Russia to-morrow will be the report of the Soviet Republic, and the hon. Gentleman may depend upon it that it will not be said there that he has made only a short and perfunctory statement and that the real terms are to be disclosed to the House of Commons later on, that the whole thing is in suspense, that three months hence the question will be reconsidered by Great Britain. That is not how it will appear in Russia. It will appear in Russia to-morrow that the hon. Gentleman, in the British House of Commons, pledging the British House of Commons as well as his own Government, had said that the next day he was going to sign a treaty with the Soviet Government—in which he did what? Two things, as far as I can follow him. I do not know what the rest means. The first thing was that he was going to cancel the whole of our debt. That is a very serious thing.

Mr. LLOYD GEORGE:

I listened very carefully to the hon. Gentleman, but if he says that it is not so, I accept his statement at once.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I did not say "write off" the debt. I said "write down" the debt, and also the counter claims on the part of the Soviet Government.

Mr. LLOYD GEORGE:

Surely—as far as I can see—this is a fake. It is a contract in which the space for every essential figure is left blank. The hon. Gentleman says he has entered into a bargain to write down the debt. By how much? I forget what the figures of the debt are, but they run into hundreds of millions. I mean the debt that is due from Russia to us. [HON. MEMBERS "£600,000,000!"] I thought it was £500,000,000 to £600,000,000. There is a similar amount due from France, and there is an amount due from Belgium. There is an amount due from Italy. Is it to go forth that we are to write off or write down the debts hero without a consideration of the whole of the Inter-Allied debts? And by how much? Is it 25 per cent. or 50 per cent.? How much? How can the hon. Gentleman come here and announce a Treaty when he cannot tell us within £400,000,000 how much? After all, here is a subject of the first importance. We are to write off or to write down—

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

The right hon. Gentleman is having an orgy of misrepresentation. The two things, the debts and the international claims, are reserved by Article 9 for discussion at a later date.

Mr. LLOYD GEORGE:

There is a statement about something which is known as Article 9. Cannot we see Article 9? The hon. Gentleman, when he explained the Treaty only a minute ago, said he was "writing down" the debt. He is not. He has discovered that he was wrong in the explanation he gave a few seconds ago. It is to be discussed later on. What sort of Treaty is this? Every item of any consequence—[HON. MEMBERS "What about the Treaty of Versailles?"] No, the complaint about the Treaty of Versailles was about things which were decided in it. That was the complaint of hon. Members. I will refer to another of the provisions of this Treaty. What are the arrangements about the claims I do not know. The hon. Gentleman said that they were to be referred to a Commission. Who is to appoint the Commission? How is it to be constituted? What are the principles upon which it is to adjudicate? Is the lump sum a lump sum to the individuals, or is it a lump sum of £10,000,000, £15,000,000 or £100,000,000 to be distributed by the Commission? I think we ought to know. Does the hon. Gentleman know? He is going to sign to-morrow something of which he has not a ghost of an idea to-night. All he knows is that he is going to sign. Sign what? Well, he is going to trust to luck. Take this loan which is to be guaranteed. It will be known in Russia to-morrow that the British Government has said in the House of Commons that there is to be a guaranteed loan to Russia. [HON. MEMBERS: "Under certain conditions!"] The amount is not specified; the conditions are not specified. [HON. MEMBERs: "Yes!"] No; they are to be discussed. Recently we were discussing the question of our surplus. An hon. Friend said that the surplus for this country was £100,000,000. Out of that you deduct £33,000,000 for the American debt, which leaves £67,000,000. I do not know what the amount is to be from Germany. But there is very little left out of that. We are to guarantee a loan which we would not guarantee to any of our Allies. No guarantee has been invited for any of the other countries. No guarantee is asked for Germany as a condition of a great European settlement, and we, sitting on these benches, should not commit ourselves to supporting a proposal of that kind. I think it is right that should be known, and that the Russian delegation should also know that the House of Commons is not committing itself to vague propositions which will be interpreted in Russia in a form which the Soviet Government itself will communicate to the people. It is unfair to the Russian people. The hon. Gentleman said a very remarkable thing. He complained about criticisms of the Soviet Government as to the effects of their regime in Russia, and went on to say that there was very little information on the subject. Has he made inquiries as to developments taking place there? I am not talking of political developments, but commercial developments, industrial developments, the way that the works are becoming derelict there. He says he does not know; yet he is going to guarantee a loan upon a security of which he does not even know the conditions. I hope that the hon. Gentleman is going to follow the example set by his chief, and is going to let us have in the papers to-morrow morning such information as he has, and then we can come to some conclusion, at any rate, to-morrow upon this subject.

9.0 P.M.

Photo of Dr Leslie Haden-Guest Dr Leslie Haden-Guest , Southwark North

I am very glad to know that a settlement, although not a complete settlement, has been arrived at by His Majesty's Government and I deplore the extraordinary attitude of the right hon. Gentleman the Member for Canterbury (Mr. R. McNeill) whose point of view seemed to be influenced by prejudice and who does not appear to realise what a very large amount of harm has been done by the unfortunate folly of preceding Governments in not getting on with the recognition of Russia. I am exceedingly sorry that the Russian Government was not recognised at an earlier stage, and right hon. and hon. Gentlemen opposite ought to face the fact that if there are difficulties in the way at the present time, they themselves, to a large extent, brought those difficulties into being by their actions in the past. They have refused to face the facts of the situation. They have refused to recognise that the Soviet Government with which, as has been said from the Front Bench to-day, this party does not agree as regards its principles, and with which we have not pretended to agree as to all the actions carried out in Russia, but, nevertheless, the Soviet Government is a Government firmly established in Russia and known to be firmly established, at least, since the year 1921. I speak in this matter simply and only as a realist in politics and I appeal to right hon. and hon. Members opposite, including the right hon. Gentleman the Member for Canterbury, to take a realist view of the situation. The settlement of the Russian question is not only urgent for this country but is urgent for the whole of Europe. Unless the Russian question is settled we shall not get a peaceful solution in Europe. I quite agree that it is necessary to face the economic facts as well as the political facts of the situa- tion. It is necessary to recognise that we are not going to get a very large amount of trade out of Russia in the immediate future, but that is no reason for not having defined relationship with that country. Nobody expects to get a very large amount of trade out of Turkey. We have, nevertheless, negotiated a treaty with that country; we have a defined relationship with that country, and it is necessary we should have a defined relationship with all countries in the world, but especially is it necessary to have a definite relationship with Russia at the present time. I appeal to hon. Gentlemen opposite not to try to draw too close a parallel between what their experience leads them to expect in a country and what the conditions actually are in that country. Russia never was organised in the way in which this country is organised. Hon. Gentlemen opposite speak as though the regime of nationalisation was a new thing in Russia. Are they not aware that the larger part of the riches of Siberia were always Government or State property before the revolution—something over 90 per cent.—and that the Soviet regime in that respect has changed very little indeed. I suggest that before yielding to some of the prejudices which are aroused in this matter and which stand in the way of negotiating an arrangement with Russia, hon. Members should try to look at things as they are and not as they imagine them to be. I am no upholder of the Soviet regime. I have made it quite clear, both in speeches and in writings, that I am not an upholder of that regime, but I know from my experience of European conditions that unless we settle with Russia we cannot settle with the Balkans, with Poland or with Germany on any secure basis. Russia is essential to the security of Europe and I suggest that more essential than any economic arrangement with Russia, is a political settlement. Hon. Members, when considering this matter should look at the map and realise how Russia abuts on the Balkans, abuts on the East and abuts on India and realise the enormous importance to the British Empire of a political settlement with Russia.

As to the question of a loan, I hope hon. Members opposite, for their own sakes, will not commit themselves in advance to an attitude of complete hostility towards a loan. Suppose a loan were proposed to be spent in this country in the engineering industries, on ships and machinery, especially agricultural machinery, in precisely those trades which are most affected by unemployment, would hon. Member's opposite, as business men, suggest that it was an unbusiness like proceeding? As a, matter of fact, security and good security would have to be given, and Russia, an immensely wealthy country, is in a position to give that security, and I am convinced the Government would be obliged to demand that security for any loan given. Any real settlement of the European question is hound to be slow. Russia is too often regarded as an old country. Its old customs, its picturesque religion, its picturesque peasant costume are referred to, and people think of it as though it were some survival from mediævalism. As a matter of fact, although that is true of certain customs, certain costumes, and certain habits, Russia in effect is a new country. That Russia is not exploited. There are in Siberia enormous deposits of oil, coal, and iron which have never been touched.

Photo of Mr Fredric Wise Mr Fredric Wise , Ilford

Hear, hear! But it is 200 years behind the times.

Dr. GUEST:

The hon. Member is making my point. Russia is a country, I agree, some hundreds of years behind Europe and the United States of America in economic development, and when you are considering the Russian problem, you should consider the question of the exploitation of Russia from the point of view of a country 200 years behind in economic development, and not from the point of view of a country exactly parallel with England, France, or Germany. I ask hon. Members once again to look at the matter from a realist point of view. If this Parliament and its workings were described in a bare outline to persons living in another land, they might get a very curious impression of what went on in this country. I remember recently being told that when the Labour Government came into office a large whip was printed in an American journal, with the statement underneath: "The Labour Government uses the same Whip," evidently in reference to the fact that certain officers of Parliament are known as Whips. We have nearly an equally false idea about a good deal of what goes on in Russia. If the word "Soviet" were always translated "Council," which I understand is what it means, there would have been very much less misrepresentation and misunderstanding of the meaning of the Soviet, and while I myself consider that the Soviet régime is one which does not work very well, because it is very closely like the organisation of the Metropolitan Water Board instead of being a more effective form of organisation, I do not think it justifiable to attack it in the way in which it has been attacked, as though all its régime was meant to be subversive of all civilised procedure.

I have myself, unlike certain hon. Members, visited Russia on two occasions. There is not the slightest doubt in the world that Russia is arising again from the ashes of the War and of the revolution, and is building up a new prosperity on a new foundation. Hon. Members may not like that, but they must recognise it. They must recognise what the facts of the situation are, and they must deal with them without any prejudice. I suggest that if we have, in the settlement brought before us to-night by the Under-Secretary, a settlement which is one that helps us to get the people of this country and the people of Russia more closely together, it is a settlement that we should support, and I suggest that this Russian settlement is the mark of the beginning of an understanding of new settlements that have to be made in the world. Hon. Members opposite have to realise that they cannot settle all questions as they have been settled in the past. The common people of the world, the ordinary people of the world, have to be consulted, and you will not make settlements, as you have done in the past, above the heads of the people. You will have to make settlements which appeal to the ordinary people.

I suggest that sympathy and understanding should be shown in this Debate, and I deprecate very strongly some of the remarks which fell from the right hon. Member for Canterbury, which seemed to me directed by an animosity, not against a form of government, but against a people. It seemed to me very regrettable indeed that, even by inadvertence, any remark of that character should come out. I have myself criticised the Government in Russia very strongly indeed, but I have attempted never to say anything which would be in the least degree hostile to the people of Russia, for whom I have a very great admiration and, in some respects, even affection. I am sure that that opinion is shared by hon. Members opposite, but let me appeal to them, if that be their feeling, not to make it quite valueless by the forms of words to which they give expression. If they use words which can be construed in Russia as hostility to the Russian people, it will produce the very worst possible impression in Russia, and I suggest also that all of us in this House are to some extent in the position of leaders. Hon. Members opposite belong very largely to a class who have been leaders of men for a very long time. Let me remind them that, in the face of the new world, in the face of new conditions which require a very careful understanding, they should remember that leadership is not only ruling men, but also caring for men and providing for men, and that what we have to do in our relations with Russia is to realise not only the political and the economic situation, as we should have to do in the case of Germany or France, but that Russia is a backward country, a country suffering very serious disabilities, a country saddled with a Government of which many of us heartily disapprove, but a Government with which we have to negotiate if we are going to attempt to help the Russian people.

We have, in a word, to take bigger views and longer views than have been customary in foreign affairs. I appeal to hon. Members opposite and to hon. Members in every part of the House to take bigger views on this matter than have been given expression to from the benches opposite to-night, and to realise that all this nonsensical, prejudiced talk about what has been done in Russia and what has not been done in Russia is something which ought to be swept on one side, in order to leave the stage clear for a new understanding, in which it will be possible for the first time for the people of this country and the people of Russia to approach one another in friendship.

Photo of Mr Edward Grenfell Mr Edward Grenfell , City of London

I should like to pay a tribute to the hon. Member for North Southwark (Dr. Guest) at any rate for the earlier part of his speech, in which he displayed great knowledge and spoke with moderation. In the latter part, it seemed to me that he was beating himself up into a white heat, not about what has been said from these benches, but rather about what might have been said. I did not understand the right hon. Member for Canterbury (Mr. R. McNeill) to be provocative. There may have been times when he has been, but I listened very carefully to his words—

Dr. GUEST:

I think I was justified in saying that the whole attitude and the interruptions of the right hon. Member were most provocative.

Photo of Mr Edward Grenfell Mr Edward Grenfell , City of London

I do not take that view. In a very large meeting in the City which was held on this subject of Russian debts at which I was allowed to speak, I, personally, and all the other speakers took the line of expressing, as the hon. Member has done, very great regard for the people of Russia. I have had experience in works out there, and I have had experience, not personally but in trading companies, there in the last year, and I am of opinion that the poorer people—and most of them are very poor—are ready to work. They are not very intelligent, because, as the hon. Member has already said, they are backward, but they are not slackers, and they never have been shirkers. But the whole bearing of this discussion is whether we should make an agreement with the Soviet Government, and whether we should lend or guarantee them money. I understood, though there was some conversation going on, that the Under-Secretary stated he had no particular love for the present Soviet Government. I understood the last speaker to be of the same opinion, but it is proposed to make a Treaty and to guarantee a loan to these very people of whom the Under-Secretary does not speak with great respect, and whom, I think, the last speaker has repudiated.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I should like to he allowed to correct my hon. Friend. I did not criticise at all the personnel of the Soviet Government, but their system.

Photo of Mr Edward Grenfell Mr Edward Grenfell , City of London

Tsardom to-day is not practical politics. I accept the Under-Secretary's correction, but, at any rate, it is the Soviet and the present Soviet officials to whom we are lending this money, and with whom we are making a treaty, and I would like to ask the Under-Secretary whether the Agreement arrived at to-day is an entirely new one, or whether it is the result of the great labour he and his colleagues have had for the last four months? Is this some arrangement come to yesterday after luncheon, or is it really the result of four months' very arduous work to which these gentlemen have given attention? I do not get an answer to the question.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I have been asked so many questions that I was reserving myself to answer them together. But if the hon. Gentleman wants an answer now, I may say this is the result of three and a half months' discussion. A decision was delayed in the last two or three days on specific points.

Photo of Mr Edward Grenfell Mr Edward Grenfell , City of London

That is the point I wished to arrive at, and for this reason. On Monday I put down a question to ask the Secretary of State for Foreign Affairs if, in view of the short time remaining for discussion, he will issue a Paper giving particulars of the financial proposals to be submitted to the House as a result of the Anglo-Russian Conference, so that Members may have time to consider the same before the promised Debate takes place? The answer from the Prime Minister was: Yes, Sir. I propose to have Papers laid before the House prior to the Debate on the results of the Anglo-Soviet Conference."—[OFFICIAL REPORT, 4th August, 1924; col. 2500, Vol. 176.] It is quite clear we are not going to have a chance of discussing this to-morrow, and it was well known to the Government that to-night it would be discussed. The Under-Secretary told me yesterday that all negotiations were broken off, as was in fact the case, and that these papers, for which I had asked, and which had been promised to me, were ready, and were at my disposal, or, at any rate, I should have them this morning. I submit that the Under-Secretary has stated to-night a rough outline only of his scheme. When I ventured to ask him a question, he said that the details were not quite settled, but my question, and other questions, were general ones. I venture to ask if this is the old scheme, which was only rounded off yesterday afternoon, and whether the scheme was already printed and was to be shown to the House? Would he be good enough, if it is already printed, to let us have the whole of that to-morrow morning? In that case we shall be able to judge what is the result of four months' argument, and what were the final touches which allowed our Government to come to an agreement. I think that would be very important.

May I turn to the main points of the speech, as representing the City of London, which may not be very popular with hon. Gentlemen on the other side. We have given a good dead of study to this question, and before the Russian Delegation came over here, certain of us, including people of importance in the banking world, thought it right to give to the Chancellor of the Exchequer their opinion as to what were the chances of raising money and of trading generally with Russia. I understood that it was very badly viewed in Russia by the representatives of the Soviet Government. I still think we were right to give that opinion to the Government, and I am borne out in that by the statement of the Prime Minister with regard to the settlement as to Germany. In that case he sought the advice of two leading bankers before negotiations were started, and those bankers informed the Prime Minister and the Chancellor that they wished to give no advice, partly, no doubt, because they found when advice was given before it was not acceptable, but mainly because the agreement to be signed would be hedged round with so many conditions that they felt they could not give advice at that time as to the conditions on which any loan could be raised. When we gave this advice about Russia we had no desire to hamper Russia, but only the desire to help her. We gave that advice, and I understood from the Under-Secretary for Foreign Affairs, when last this matter was discussed in the House, that, having got this advice from the bankers, he said he did not know where else to go, and he went to certain people for advice for the first three months the delegation was here, and got no comfort at all. I think he and I met in other circles afterwards, and he received what I think, was good, and, at any rate, honest advice, which, I think, coincided with the advice given to His Majesty's Government before the delegation came over.

We would like to know why it is considered advisable to make this Agreement at all. I can see no reason for Englishmen wanting to trade with Russia at present, except upon the same basis with which you deal with an extremely wild country, where you may take goods to the sea-shore, and swap them for other goods, but there does not seem much temptation to go inside the country. There has been the case of the Anglo-Caucasian Company, which had the approval of the Russian Government, and has now been told to liquidate. On several occasions we have been informed in this House by the Under-Secretary, and, I believe, by the Prime Minister himself, that through their representative they understood arrangements had been made for the Company to start again, or to be allowed to remain, but, in effect, this company has not been allowed to do so. It is still told to liquidate, and can get no satisfaction from the officials there. From this, I think, we may gather that the officials in Moscow or Georgia, or whichever country the company is trading with, do not give the same answers as are given to the Under-Secretary for Foreign Affairs in London.

With regard to these guarantees for a loan, the hon. Member for Canterbury has referred to the other loans guaranteed or supported by this Government. I will take them in turn, because I happen to be very closely acquainted with the arrangements made. The first was to Austria, and in that case it was believed that Vienna was the centre of Central Europe as far as finance and trade were concerned; also that it was advisable, almost necessary, to support Vienna and the small State now called Austria in order to start Central Europe trading again. Before lending money to this highly civilised country—I mean a country with a very old civilisation unlike Russia—it was arranged that through the League of Nations, or with the advice of the League of Nations, certain very close restrictions were to be put on the finance of that country. At the same time foreign and independent advisers were to control their finances. With regard to Hungary, the outside countries did not guarantee that loan, but I think I am in order in saying that His Majesty's Government were extremely anxious that the loan should be made to Hungary, and they brought considerable pressure to bear on the London bankers and money market to take that loan. That is loan No. 2. The loan to Germany, which was discussed yesterday, is a much more important thing than the loan to Russia, yet we have the assurance of the Prime Minister that it is not proposed that England should guarantee that loan. But at the same time by whosoever that loan is made the strongest precautions are being taken by the other countries and by the lenders, to make that loan a safe one. We have in that country, not only a civilisation of the highest order but industrial and banking skill of the first order, and if Germany intends to be honest and to fulfil their agreement they will be able to make that loan good. There is no guarantee that that loan is good, but I think there is every inducement to Germany to fulfil the conditions.

With Russia, we have not for a good many years seen any desire on the part of the existing Government to fulfil the undertakings or respect promises. This loan, if it be made by the investor, will be private property and open to confiscation. If it is made under the guarantee of the British Government, I am not aware that they will pay much more attention to repaying the British Government this new loan than they would to the individual and ordinary investor. I would say now to the Government that if they propose to guarantee this loan—a loan to a country without credit and a country whose Government does not at present enjoy credit or respect—our Government had better do the straightforward thing and put their hands in their pocket and lend their, or indirectly our, money. Do not let them deceive themselves by guaranteeing a loan when they will probably have to pay it. To guarantee a loan and then issue that loan is a most expensive thing. You had better issue an English loan straightforwardly than go to the expense of saying Russia is the debtor and should pay an extra ¼ per cent. That is the ordinary advice which I think might be given by any banker. With regard to conditions in Russia which make a loan desirable, let me point out that on the 22nd May the Under-Secretary said: Intending travellers to the Soviet areas are informed that His Majesty's Government are unable to afford them the same protection as they do in other countries. I presume that means that it is not very safe to travel in Russia—less safe than in any other country. I am not aware that the Government have been able to give very much protection to British subjects and British soldiers and sailors in the South of Ireland. It is only about 24 or 36 hours ago that this House was thrilled with the news of the murder of Mrs. Evans. I am not aware that His Majesty's Government are able to take active steps in Mexico to make the Mexicans pay for that, but I understand from the Under-Secretary that Russia is less safe even than those countries. He has signalled to people not to go there. I do not think that is a country to which we wish to lend money. Our Prime Minister, I think, has been treated with more vilification from leading people in Russia than anyone. It might be said that the people who form the Soviet Government are not responsible for the Russian people. That is true. Again, it is to those people that we are lending this money.

I should hope that all sides in the House will agree with what I am going to say now, and I know the Government side will. It may be that on this side we would rather one of the Members now sitting on our Front Bench or the right hon. Gentleman the Member for Paisley (Mr. Asquith) or the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) was our Prime Minister. That may be our internal politics, but once this House has put its direction in the hands of the right hon. Gentleman the Member for Aberavon (Mr. Ramsay MacDonald), we wish to say for all parties here that, if the leaders of a foreign country treated him as the leaders of the Soviet have treated our present Prime Minister, it is our duty, on these benches and on those, to resent that treatment; to resent those accusations as much as any hon. Gentleman opposite would resent it if we talked in that way of their present leader. The Under-Secretary has said he is too much of a gentleman to resent this sort of thing. It may be the finest gesture you could make when you receive a blow, to offer the other cheek, but I really think in this case, when you have had this delegation of Russians sitting with you day after day, when you have been treating them as gentlemen, it is hardly the act of a civilised deputation, or the act of a civilised Government at home who have sent that delegation, to villify most of the Members sitting on the Government Front Bench because, as they believe, the more insults they hurl at you the better terms they would get. I wish to say on behalf of the city and on behalf of a good many financial people that we are generally prompted in business deals to look at the security, not to look at politics and not to consider too much the ordinary moral character of the borrower, but we do consider that if it is a business proposition, and if in the past he has not kept good faith, then we do not want to lend to him. As to-day the world is full of borrowers, we shall choose the people we lend to more carefully than we have in the past. I hope the Government will not deceive themselves by thinking they will get the slightest response to this loan merely as a loan. If they back the bill, no doubt it will be subscribed for in the city, but in that event the five, 10 or 20 millions that they may ask for—I do not know what the figure is—will be taken from much more desirable objects.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

I find myself in the position of being able to commiserate with the Under-Secretary of State for Foreign Affairs. He has been very patient and painstaking about these negotiations, and he is to be congratulated on getting at any rate some agreement with the Russians after the last three Governments have made no progress in that direction whatsoever. We had, it is true, a trade agreement, but that was always announced as unsatisfactory by the flower of the Conservative party, led especially by the hon. and gallant Member for Bournemouth (Sir H. Croft). It was unsatisfactory from the point of view of British nationals who had a legitimate claim against the Russian Government for goods supplied and services rendered, or for properties nationalised for which they wished some compensation.

Photo of Sir Robert Horne Sir Robert Horne , Glasgow Hillhead

The hon. and gallant Member cannot have read that trading agreement. It contains provisions with regard to that very matter. I shall be surprised if the agreement which is said now to have been made contains anything better.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

The right hon. Gentleman will perhaps tell us how much cash has been got for these claimants by that trade agreement. I cannot, however, congratulate the Under-Secretary of State for Foreign Affairs on his method of presenting the case. I make every allowance for the fact that he has had an extraordinarily difficult task, and has sat for many continuous hours in hard negotiation; but, nevertheless, he struck me as speaking at the Box with little enthusiasm, and with little recognition of the tremendous thing that he really has accomplished. Up till this agreement, the bondholders were not even recognised as existing, or as having any sort of claim at all. What offers have been made to them now? I am informed that the offers made are something on these lines. If I am proved to-morrow to be wrong, I am in the same position as the rest of the House in not knowing the details, but this is what I understand has been offered to the bond-holders. I got my information from no less a person than the head of the Russian Mission over here, and he has no reason to attempt to deceive. The Russian Government say, "Here are these bonds which were incurred on behalf of the great Russian Empire, from which large and important areas have seceded, or have been annexed by other countries. We lost Poland, one of our great manufacturing districts. We have lost our Baltic ports and our Baltic provinces, Finland and Bessarabia. Therefore, we say that our assets are very much reduced, and that these countries must shoulder part of the debt. Have our Polish friends and our Finnish friends started to pay interest on the Tsarst debts? How much have we got from them?"

The Russian offer was 50 per cent. They said, "We will take an arbitrary sum, and we will write off 50 per cent., which shall he shouldered, or ought to be shouldered, by these seceding States." It must be remembered that Poland has boundaries going far beyond her natural frontiers. Then they said they would pay the 50 per cent over 50 years, or half the sum in cash—25 per cent. in cash. That is an enormous advance on Genoa. The right hon. Gentleman the Member for Hillhead (Sir R. Horne), who interrupted me just now, did not ever get to that stage in his negotiations. He made very little progress when it came to dealing with the question of bonds either at Genoa or here in London when the first Trade Agreement was signed by M. Trotsky and himself and the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George). At any rate, 50 per cent. is offered over 50 years, or 25 per cent. cash. That is hard money offered to bondholders.

Photo of Mr Edward Hemmerde Mr Edward Hemmerde , Crewe

Does the 50 per cent. include arrears of interest as well?

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

The offer was made to the Committee of Bondholders, representing the holders of Russian bonds. It was made to important holders of Russian bonds, and my information is that, as regards the holders of Russian bonds, as opposed to the holders of Brazilian bonds or Mexican bonds or any other bonds, they were very glad to get such an offer. They saw a prospect of getting some cash down for a debt which in most cases they had completely written off.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

My hon. and gallant Friend will excuse me from interrupting again. It is only to get the facts. Am I to understand that this offer was made direct to the Council of Foreign Bondholders; was it with regard to rouble bonds or only to sterling bonds, and when was it made?

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

It was made to the representative holders—large holders—of Russian bonds. I have given the source of my information. It was made by the head of the Russian Mission himself. He so informed me.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

Were they sterling or rouble bonds?

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

The whole of the bonds—sterling and rouble. The hon. and gallant Member for Bournemouth may be interested to know that, curious as it may seem to him, my first interest always has been to get justice for our own nationals who have suffered as the result of the Revolution and Civil War in Russia. That is the way I have always approached this question. I have put British interests, as traders, as concession holders and even as bondholders, first. Naturally the Russian delegates have put Russian interests first, or they would be very poor representatives of their Government.

With regard to the question of property, here you have a number of British property owners who have been dispossessed, whose property has been nationalised, and who have no compensation at all. They are offered a settlement. We do not know the details of it yet. The Russian Government offer to set up a Commission of three of their nationals to sit with three British Commissioners in order to settle the claims made by these property owners. We do not guarantee this Loan and do not carry out the Treaty until the British Government is satisfied that these property owners have received something solid, and that the matter has been dealt with in equity and justice. The policy of the Conservative Government in this matter has been one of war against Russia, and this is the only concrete policy we have had from hon. Gentlemen opposite. That is all they have ever done in this matter. It is true that they had this trade agreement, but their policy in regard to Russia has added to our debt £100,000,000, and not one copper have we got towards that debt. They are now offered the services of a mixed commission—

Photo of Sir Robert Horne Sir Robert Horne , Glasgow Hillhead

I have had considerable experience in regard to this question, and if the hon. and gallant Member looks back to my speeches he will find in them a very different tone to that which he has expressed. I want to ask the hon. and gallant Member when did he ever say a single word in favour of redeeming British interests in Russia?

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

Invariably. I always said I was in favour of supporting our nationals.

Photo of Sir Robert Horne Sir Robert Horne , Glasgow Hillhead

I have never once heard the hon. and gallant Member say a word in favour of British interests in Russia.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

We can easily settle that matter by looking up the records. I have filled many columns of the OFFICIAL REPORT, and there is plenty of proof in this direction in the records of the House. The property owners are now offered the services of a mixed Commission, and until they are satisfied, this loan is not guaranteed and the items in favour of Russia do not come into force. Take the miscellaneous claims. An agreement has been reached on that point. That means, at any rate, that something is coming to the poor governesses and others who lost their property in Russia. There are other similar claims, and are all these things nothing? At any rate, they get a promise of something, and until they do get something Russia does not get anything under the guaranteed loan scheme.

I would like to hear the opinion of those who have claims against Russia in regard to property and the bond-holders on the question whether they would prefer the policy pursued by the Under-Secretary of State for Foreign Affairs as a means of getting something, or the policy of hon. Gentlemen opposite. We have tried the policy of hon. Gentlemen opposite, and it has been a disgraceful and blood-stained failure. [HON. MEMBERS: "Oh, oh!"] I could use even stronger language if I had not such a great respect for this House. At present we are only on the threshold of the policy of the Prime Minister. We have had some experience of the policy of the right hon. Gentleman the Member for Hillhead (Sir R. Horne). With regard to the policy of the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) I think he saved himself on this subject in his last sentence when he said that he would wait to see the whole agreement in print. We have heard the terms of the agreement and they will at least bring something substantial to British citizens.

Take the question of the fishermen. This may not interest the people of Bournemouth so much because they do not go to sea in trawlers. To the people of Hull, however, this is a matter of great importance, because the catches in the White Sea are extremely valuable. They are able there to get valuable fish at a time when they cannot be got anywhere else, and this means many trawlers employing the finest type of deep-sea fishermen you can find anywhere, and they will be employed during the months when otherwise they would be laid up. We nearly had a war about this question, and fishing in the White Sea was rendered extremely hazardous. Our fishermen were arrested and suffered damage to their boats, but recently £30,000 compensation has been paid for the losses sustained by our fishermen. Consequently this fishery agreement is of great importance to the fishermen of Hull, and I would like to ask will it come into force immediately?

I would also like to know if the three-mile limit is preserved along the Murmansk Coast. Certain other countries have been claiming a four-mile limit, but I hope that does not come into the agreement. We want to make our plans in Hull for the next winter's fishing. The right hon. Gentleman the Member for Canterbury (Mr. R. McNeill) compared the proposed guarantee of a loan to those loans which were made under the auspices of the League of Nations to Austria and Hungary, and he said that there we had some financial control. I would like to point out that Austria and Hungary were beaten enemies in the War. They were in extremis, and had to come for assistance and we were able to impose what terms we liked. Is it suggested by the Conservative party that, if we grant a loan to Russia, we can impose the same conditions as we did on Austria and Hungary? If that is insisted upon we shall never come to any agreement at all.

Photo of Sir Robert Horne Sir Robert Horne , Glasgow Hillhead

The hon. and gallant Member seems to be the only person who is able to speak with knowledge with regard to this Treaty. I would like to ask him have we agreed to give a loan?

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

The right hon. Gentleman must know that the payment of these claims is dependent upon a loan.

Photo of Sir Robert Horne Sir Robert Horne , Glasgow Hillhead

Surely the hon. and gallant Member knows the distinction between the British Government giving a loan and guaranteeingaloan. In one case they would have to provide the money, and in the other case it is provided by private citizens who would have to insist upon proper guarantees.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

Of course, there is no question of the British Government giving a loan—

Photo of Sir Robert Horne Sir Robert Horne , Glasgow Hillhead

Well, that is the impression I got from the hon. and gallant Member.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

If I used that word, I am much obliged to the right hon. Gentleman for correcting me. What is proposed is guarantee of the loan by the British Government. That is all we did with Hungary and Austria. The Hungarian loan was placed on the market and it went like hot cakes, because it had a British guarantee. It had the collective guarantee of the Powers behind it.

Lieut.-Colonel Sir F. HALL:

I think, under the circumstances, the hon. and gallant. Member is confusing the question of the Austrian loan with the Hungarian loan. The Austrian loan was guaranteed by this country to the extent of 26 per cent. The Hungarian loan was not guaranteed in any shape or form by this country.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

It was under the auspices of the League of Nations or under the States members of the League. [HON. MEMBERS: "No!"] At any rate it is quite irrelevant to the point I am making, that the right hon. Member for Canterbury compared the case of Austria with that of Russia. I say you cannot in any way compare them. A little, beaten, poverty-stricken country like Austria had to take what was offered, but Russia need not make this agreement with us at all. There is a strong party in Russia, it is quite well known, who are opposed to this agreement just as there is a strong party in this House which is opposed to any agreement with Russia—[HON. MEMBERS: "Hear, hear!"]—and the cheers below the Gangway bear me out in that statement. Under this agreement I claim that we have a very great advance from the days of the Trade Agreement and from the Genoa Conference, a very great advance indeed, and I think the Government are very much to be congratulated upon it. [An HON. MEMBER: "We have not seen the agreement yet!"] I have had it explained to me, and I have watched this matter rather closely for weeks or months.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

I really do not think I am called upon to answer questions to which the two speakers for the Government have not replied. The Conservative party, and the right hon. Gentleman the Member for Carnarvon Boroughs, have expressed themselves as shocked at the proposal to guarantee this loan. I am surprised at their attitude towards the Government guaranteeing this loan. I think it is a very courageous act.

Photo of Sir Robert Horne Sir Robert Horne , Glasgow Hillhead

I hope the hon. and gallant Gentleman will excuse me—

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

I have given way to several interruptions, and I might be allowed to bring my few remarks to a close. I think the Cabinet is to be congratulated on its courage in endorsing the principle of guaranteeing a reconstruction loan, which is what this means.

10.0 P.M.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

The matter is to be determined by further discussion and the amount of compensation for our nationals is necessarily left indeterminate. The claims are inflated as most claims for war or civil-war damage are. This loan will bring direct employment in those areas in this country which are the most hard hit. It will bring a great deal of the money into our industries. It will take an arbitrary sum of £40,000,000—assuming it is £40,000,000—I do not know whether that is the amount that is finally agreed upon, and nobody else knows it—but it will be the makers of agricultural machinery, manufacturers generally, and shipbuilding, engineering where the greatest relief will be felt. I am one of those who consider that all loans that we make largely go out in the form of goods, and this is particularly true in the case of Russia, which is a great market for manufactured goods. Hon. Gentlemen opposite have not made any great attack so far upon the Dawes proposals. The right hon. Gentleman the late Prime Minister has declared himself at one with the present Prime Minister in trying to get the proposals of the Dawes Committee accepted. You are there supporting and re-establishing a formidable trade rival, in Germany. We have not had anything like the attacks from those benches opposite that we have had on this proposal to do much the same thing in regard to Russia and yet Russia can never be a trade competitor in the same sense that Germany can be. Russia is a great agricultural, mining and lumber producing country and a great absorber of manufactured goods, and Germany is a great manufacturing country like ourselves that has to import greater and greater quantities of food every year to balance her economic Budget. Therefore I am driven to the conclusion that the reason why this attack is made on the proposal to guarantee a reconstruction loan to Russia—in spite of the undoubted benefit to our trade, and in spite of the other side of the bargain which will bring cash to British subjects who suffered great loss and injury as a result of the civil war—is that the real reason is hatred and prejudice for a Government that has carried through a social and economic revolution. That is the real reason, and hon. Gentlemen opposite have not the courage to proclaim it. The last time the right hon. Member for Canterbury spoke he remarked that he would be very glad if an agreement were made with Russia. That was a very hollow sentiment coming from that bench. I do not know if he agreed with me then, I think he agrees with me now. The moment that something is done to bring about a settlement at once appeals to the old prejudices and the old hatreds that were used to the loss and disgrace of this country during the Coalition Government. I ask the Government to stand firm, and if necessary to appeal to the masses of the people in the country. Go to Coventry, go to Birmingham, go to Hull, go to Glasgow, to where men are deteriorating in idleness and put it and—yes, and Barrow—and put it to them that, instead of paying out £1 a week or 30s. to keep these men in idleness, that you propose to use some of the Government's credit to bring work to them to supply even the wicked Russians, and that that is the policy that you oppose. Go down to the country—

Photo of Mr Hugh Ferguson Mr Hugh Ferguson , Motherwell

On a point of Order, Mr. Speaker. Is it right for the hon. Member to point across the House? He is shaking his hands across to this side.

Photo of Mr John Whitley Mr John Whitley , Halifax

I am obliged for the assistance of the hon. Member.

Photo of Mr Hugh Ferguson Mr Hugh Ferguson , Motherwell

Yes, and you need it. [HON. MEMBERS: "Withdraw!"] I am penalised for what is allowed to other Members.

Photo of Mr John Whitley Mr John Whitley , Halifax

I would ask the hon. and gallant Member for Central Hull to address me.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

If I waved my right hand, it was due to the state of my feelings on this question. I ask hon. Gentlemen to go to the hard-headed industrial and manufacturing centres and talk the sort of, may I use the word, "nonsense" that we have heard to-night from the opposite benches. Let them put the proposal fairly to men who have been out of work now for two, three and four years, and ask them whether they think the Government are right for once in guaranteeing a loan of reconstruction and peace, when they spent £100,000,000 on war with no result whatsoever—on civil war, which I think was a disgrace to this country—and when they willingly spent thousands of millions on destruction in the late War. Let them ask those men whether they approve of a moderate loan being guaranteed by the Government, which will bring work to those who are idle and suffering to-day, and I wish them well of the result.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

I think everyone in this House will agree that we have had a Debate that has been interesting and, indeed, almost amazing in its character. The Under-Secretary said rather pathetically on a previous occasion, about a month ago, that he was a Parliamentary target. He is. He is a pathetic figure—a sort of political St. Sebastian, who is full of arrows; but with this difference, that it is his friends and not his opponents who put him in that position. What we wished in this evening's Debate is a thing which we were perfectly entitled to expect, namely, that, before the House is asked to give its consent or approval in any shape or form to proposals of this kind, we should have the Prime Minister and Foreign Secretary here in order to explain the position to us. I realise the difficulties of the Under-Secretary, and I am sure he will not take it as anything derogatory on my part towards him that we should, naturally, criticise the situation in which the whole House has been placed by the perfectly amazing Debate that has developed this evening.

Here we are, as the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) has said, asked to deal with a question of absolutely first-rate importance on the Third Reading of the Appropriation Bill, right at the fag end of the Session, when we have already passed a Government Motion for rising to morrow. We are asked to debate this matter without having had any of the pertinent papers put before us whatsoever. That is amazing enough, and yet, if the House will reflect, it is only a part of what has been the consistent action of the Government—an action of consistent evasion with regard to the whole of this Russian Conference from the beginning. If ever there was an amazing contrast, it is between what has been happening with regard to the Russian Conference and what has been happening with regard to the Inter-Allied Conference, about which there was a Debate yesterday. In that case every item of interest has been published in the daily papers day by day, with absolute frankness and fullness. What difficulties there have been have been made known to the public; what doubts there have been have not been concealed. There have been conflicts of opinion, and they have been expressed. There have been endeavours to reach an arrangement, and arrangements have been reached, and all of them from day to day have been published without reserve in the Press. There has been the blaze of a searchlight on everything that has happened with regard to the Inter-Allied Conference, and all with good results.

Here, on the other hand, if there has been any light at all on the negotiations from start to finish it has been a sort of smoky light like that of a farthing dip, if such a thing still exists, which has only served to distort the little that could be seen. If I might say one thing, it is to congratulate the Government on having excelled any of their predecessors in one respect, and that is in the polite art of Parliamentary evasion with regard to this question. The whole House has been treated with a disingenuousness over this question of the Russian Con- ferenee which I do not think has been excelled or equalled in the case of any negotiations that have preceded it. We have had continued evasion with regard to any statement being made in this House, and when I make these allegations I am prepared to back them up by absolute proof in each case. In the first place, we were told that we could not have a statement in this House because the Prime Minister did not know what was coming up. That was at the beginning. As soon as anything came up, we were not allowed to have a statement then, because he would not make a statement until there were points of substance which justified his bringing the matter before the House. Then, when points of substance had arisen, we could not have a statement because he wanted to deal with them all together, and did not want to deal with any one of them separately. All this has been stated in reluctant answers to Parliamentary questions.

Then we had a definite promise on behalf of the Prime Minister that he would come and speak to the House himself on a question of this kind. I am sure the Under-Secretary will not think that I mean it in any ill-sense towards him when I say that he knows as well as I or anyone knows that it is only the Prime Minister, if he comes to this House, who can give the answer with absolute authority. Only the Prime Minister can say that this shall be done or that shall not be done, that he will adjourn this Debate, and that he will not make a treaty until the House has been able to give its decision. Time after time we have had a definite promise that he would come, but we have never had the Prime Minister here from the beginning of the Russian Conference up to the present day. I have no doubt that a month ago it was an awkward time, and that at present it is an awkward time. It always is an awkward time with the Russian Conference when we want the Prime Minister here. It is always jam yesterday and jam to-morrow, but never jam to-day. Lastly—and here again may I reiterate the quite definite statement of my right hon. Friend the Member for Canterbury (Mr. McNeill)—we really were promised that no treaty or treaty obligation should be entered into. Upon that the right hon. Gentleman the Member for Carnarvon Boroughs has already spoken, and I will say just another word or two upon it in a minute. That is the state of darkness in which we are.

I want to repeat once again quite clearly, as the attack has always been made—it was made by the junior Member for Dundee (Mr. Morel) before it was made by the hon. and gallant Member for Central Hull (Lieut. - Commander Kenworthy) this evening—that we want to sabotage any agreement with Russia—

Photo of Mr John Mills Mr John Mills , Dartford

On a point of Order. May I ask what is the difference between a "junior Member" and an hon. Member? That is a very offensive observation.

Photo of Mr John Whitley Mr John Whitley , Halifax

I did not hear any offensive remark.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

I am sure the Member for Dundee will realise—

Photo of Mr John Mills Mr John Mills , Dartford

I understood the right hon. Gentleman, in referring to two Members of the House, to say that one was the "junior Member for Dundee."

Photo of Mr John Whitley Mr John Whitley , Halifax

It is the usual practice when reference is made to the junior Member of a constituency which returns two Members—[Interruption.] Hon. Members will please keep order, and allow me to perform my duty, instead of doing it for me. In such a case it is always the practice of this House to refer to the Member who was returned at the head of the poll as the senior Member, and to the other as the junior Member.

Sir A. STEEL MAITLAND:

Thank you, Mr. Speaker. It is a rather illustrative instance, is it not, of the way in which criticisms are sometimes directed at us when we are endeavouring to put a case before the House. I am sure that the hon. Member for Dundee (Mr. Morel) will realise that I should be the last to say anything disrespectful to him in that regard. When we come to the actual case under discussion, we have had darkness during the whole of these negotiations, and, now that we have come to the end of them, the darkness, the perplexity, the confusion is greater than it has ever been before. Employment! Not a word have we had about it. Not a word have we had about guarantees for work-giving employment in this country of any sort or kind. We do not know the amount of the loan. We do not know the conditions of the loan. We do not know whether we are going to have any repayment of the loan. All we know—I am the last person to wish to say anything disrespectful of a foreign country—is that one of the most powerful, if not the most powerful of all the people in that country has openly given us a warning that if we make a loan of this kind we can look for no guarantee of repayment whatsoever. The statement is that of Mr. Zenovieff. He denies that the Communist party is opposed to the introduction of foreign capital into Russia— Let England offer us a loan of £500,000,000 and they will see how much we hate foreign capital. If capital wishes it, we will guarantee there will be no revolution in Russia, but we will not guarantee that revolution will not occur in other countries. MacDonald was once one of Lenin's disciples, like the rest of us. Therefore, he knows the Communist movement. We will not ask guarantees from us for the repayment of loans, and we will not give guarantees. That is with regard lo the loan. We are completely in the dark with regard to the other main parts of this business. How about the money under Article 10 of the Krassin Agreement? What is going to he done with regard to that? We have heard nothing with regard to it, Can the Under-Secretary tell us what is happening? Does he know what is happening?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

The hon. Baronet is asking so many questions that I do not know whether he wants me to interrupt every time. Article 10 of the Trade Agreement will remain in force until the Treaty is signed.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

I quite agree with the right hon. Gentleman the Member for Carnarvon. We get more information by eliciting little bits as we go along than we do in any other way. Now with regard to export credits. We are told the Russian Government is going to get the benefit of export credits. I should like to have another piece of information, and I am ready to give way to the Under-Secretary if he will give it to us. Is there going to be any interference at all with the functions of the Committee that rules the Export Credit Department in this, or are they going to be allowed to decide the issue as to giving export credits in the same way as hitherto to Russia as to other places?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

There will be no interference with the Committee performing its functions as it has done hitherto.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

Then all I can say is that you will never get any credits of any sort or kind whatsoever. This is as much a fake as the whole of the rest of it. The reason is that, under the export credit system, as the Secretary to the Department of Overseas Trade knows quite well, the amount of security that the people who want the exports can put up is assessed by the Committee at its proper worth, and therefore the amount the Government will contribute is reduced proportionately if they do not think much of it, and they also impose a premium that is higher according to the risk.

We have been told there is a most stringent condition about propaganda. We know nothing more about that. All we know is that we have had the Krassin Agreement broken with regard to propaganda time and time again. Lastly, may I ask about the creditors of Russia—the bondholders? Are they the sterling bondholders, the rouble bondholders, one or other, or both? The Under-Secretary could not tell us, at the time the Debate opened, whether this agreemnt will apply to the sterling bondholders or the rouble bondholders, one or other, or both. To whom will it apply? What happens with regard to the French bondholders and the Dutch bondholders? Is this going to apply to them? They stand on exactly the same footing as our own sterling bondholders.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

May I interrupt the hon. Member? I gave way to him. Are we to understand that he would hold up the agreement for the sake of the Dutch or the French bondholders?

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

I am not certain for whom the hon. and gallant Member is speaking. I am speaking for the Opposition. I have asked individual bondholders, and they have told me that when their claims are exactly of the same character as the French bondholders and the Dutch bondholders they do not want to be treated separately from other people whose claims in justice are precisely the same as their own. Those views were put to me by leading men in the City. Now as to the miscellaneous claims. By whom are they to be paid? Who is going to settle them? Is the matter to be left to the immediate future? When these amounts have been actually settled, are they really going to be paid? We have had no information given to us on this point.

The absurdity of the whole situation this afternoon has been made absolutely plain. My right hon. Friend the Member for Canterbury (Mr. McNeill) described it as a farce. I am riot quite certain whether it is going to be a farce or, from another point of view, whether it is going to be a tragedy. If you have promises of this kind made, in the end they will come home to roost. The Russians will say, "Here is the British Government which has made these promises and is not carrying them out." I agree absolutely with the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) with reference to what may happen between the signing of the Treaty and the ratification of the Treaty. What he said was true, that if we sign this Treaty and it is not ratified it will come back upon us from Russia. If we ratify the Treaty we do not get to the end even then. We have to go forward then. Nothing is settled as to the loan, and nothing is settled practically as to anything, even when the Treaty is ratified. Consequently, if there is no loan afterwards and no agreement afterwards with the bondholders, there will be an absolute certainty that Russia will believe that this country has played them false, however little that may be true in fact, and however grossly they may misapprehend what has happened.

The Under-Secretary spoke about the White Paper which he promised to issue. I realise the difficulties under which he has been labouring, but I would point out that it was promised on behalf of the Foreign Office that the White Paper, with the two draft Treaties, should be laid and should be published, and we have a right to ask why it was not published. There is only one real reason, and that is that between the time when the Conference was said to have broken down and the time when it was hurriedly patched up again to-day there have been alterations in the draft. I think this House is entitled to know precisely what the alterations were. The Under-Secretary quoted from a paper this afternoon and, subject to your ruling, Mr. Speaker, I submit that when anyone quotes from a paper in this House it has to be laid on the Table of this House. Therefore I ask that the papers from which he quoted should be laid on the Table of this House. I understand that the Under-Secretary says that he will lay on the Table the paper from which he quoted this afternoon.

Mr. LLOYD GEORGE:

When?

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

It is printed and we are entitled to have that paper now.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I think that I can satisfy hon. Members opposite, because I do not suppose that they are inclined to be unreasonable about this matter. The Treaty was set up in type, and if negotiations had broken off the Treaty as then presented would have been laid before this House. Negotiations were resumed and it would have been very misleading of me to have laid before this House something which was incorrect. I am obliged to have it corrected, and as anybody knows, when you have two or three pages to correct it takes a little time, but it will be circulated to-morrow morning.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

The point is that we want the uncorrected proof. We want to know whether we can have the document from which the hon. Member quoted. We want to have the Paper which the Under-Secretary undertook should be laid. I respectfully ask whether, as this has been promised by the Prime Minister, and as the Under-Secretary has quoted from it, we are not entitled to have it laid?

Photo of Mr John Whitley Mr John Whitley , Halifax

The hon. Member is raising a question which should be raised at the time when the quotation was made from the Paper. I do not think that there was any request made then to have the Paper laid. At any rate, it was not made in my presence.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

You may not have been present at the time, but it was asked for. I asked for it myself, and we are still in the course of the same Debate. Are we not entitled to have it laid before us to-night?

Photo of Mr John Whitley Mr John Whitley , Halifax

As I have said, that is a claim that must be made at the time. I am prevented from dealing with the matter if the claim is only made subsequently. I never heard the claim made. It should be made at the time, and then the Chair always deals with it.

Mr. LLOYD GEORGE:

The argument was raised in answer, I think, to an appeal which I made, and it was an interruption to my speech. I certainly asked that the whole of the documents should be published. I did not claim it in form under the Rule of the House, but I asked immediately that the whole of the documents should be published and before the House began its Debate on the Adjournment to-morrow.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

May I put it to you, Sir, that this is not a case within the meaning of the old-established Rule? Here you have a Treaty which was under discussion, in which negotiations were brokers off on one particular article. In the new Treaty, which is being made, that Article has been corrected. The Under-Secretary of State for Foreign Affairs quoted one Article which has not been altered in the new Treaty, and the fact that he quoted from this Article which has not been altered, is no reason for laying the old Treaty which has been altered.

Photo of Mr Worthington Evans Mr Worthington Evans , Colchester

On that point of Order. I was present. I quite agree that I did not get up and claim that the document should be laid on the Table, but I did say, "That document ought to be laid." One knows how one says it. I said it quite audibly to those who were sitting near me, although I did not formally make the claim. With reference to what the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) has said, may I say that there is a very real point here. Let me be quite candid about it. Here is a draft Treaty which was put into print, and from it the Under-Secretary read one of the Articles. Apparently, that Treaty was not concluded; it broke down, or, rather, the negotiations on it broke down. Then something happened and a new Treaty was negotiated. This House ought to see what are the differences between the old proposal and the new Treaty. We ought to see what points have been conceded by the Government, and what points in the original negotiations the Russian representatives refused to agree to.

Photo of Mr John Whitley Mr John Whitley , Halifax

It is quite clear that this is not a point which comes under the Rules of the House. What I stated originally is quite correct. The claim for production of a document must be made at the moment. There is no case of departure from that Rule. I understood from the statement just now that the Article which has been quoted is in a document which has been laid. [HON. MEMBERS: "It has not been laid!"] In any case, I must maintain the old practice of the House, namely, that the claim for production of a document must be made at the moment.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

With reluctance, I accept that decision absolutely. But what a position the House is in! [Interruption.]

Photo of Mr John Whitley Mr John Whitley , Halifax

It is not possible to conduct a debate on a matter of such very high importance if hon. Members are interrupting all the time.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

I do not mind the interruptions. Hon. Members remind me of the skylark, which Pourest its full heartIn profuse strains of unpremeditated art. The situation is this: Because we have not risen, and demanded the document at the moment, the Under-Secretary for Foreign Affairs does not consent to lay it on the Table. The next point which it is well for the House to remark is that the Prime Minister on Monday promised to lay the Paper and never published it. So that we have not yet had this Paper, and what we naturally ask ourselves is, "What is the reason for this further reticence?" This matter is of absolutely first-rate importance. We on this side and right hon. and hon. Members below the Gangway opposite are anxious to do this: The House, we know, is absolutely free when the time comes to ratify or not to ratify the Treaty. It is a matter of exceeding gravity to refuse to ratify if the Government insist on going into it. An hon. Member said that no Government has ever considered itself debarred from agreeing to a Treaty until it has laid its case before the House. I suggest that if ever a Government had need to be careful in a matter of this kind, it is the present Government. The present Government again and again have said that they stand in a peculiar position because they do not command a majority in this House. They do not accept the ordinary defeats on which another Government would resign as being defeats which call for their resignation because they say they do not command a majority in the House. Does not that mean that when there is this very striking unanimity of opinion both on the Liberal Benches and on these benches—with the exception of the hon. and gallant Member for Central Hull—that the Government should weigh matters once, twice and thrice before signing this Treaty to-morrow.

Here I come to my last question. I wonder if the Treaty has even yet been reduced to writing? I do not believe the Treaty is yet in writing; I do not believe the Under-Secretary has yet seen the completed draft. Would not the Government do well, in these circumstances, after the history of their attitude through the whole of this Session in these Debates, to think carefully before they sign a Treaty like this to-morrow? Let us make it quite plain, not only to the people of Russia if they can hear us, but to the delegates who are here to-day from Russia, that if this Treaty is not signed ultimately, it is not we who are responsible and not the Liberal party. The responsibility lies with the Government which goes into this matter knowing it is in a minority and knowing there is an extraordinary consensus of opinion regarding it and yet would insist on signing to-morrow a Treaty not in completed draft even at this moment. I appeal to the Under-Secretary for Foreign Affairs. I put it to him in all sincerity. Does he feel that he is entitled, in these circumstances, to press the House to come to a conclusion on this Treaty to-night; does he feel that he should sign that Treaty to-morrow? I respectfully submit to him, after what has happened to-day, that he should suggest to the Prime Minister that it would be well to adjourn this Debate until to-morrow, until we could all see the Treaty, until we could study it and until the Prime Minister, who is the final authority in this matter, is prepared to give us his mature decision, one way or the other. I am quite sure, from the point of view of the good name of this country, and the confidence of this delegation and of the country from which they come, that we will keep to our engagements, that would be a much wiser course than to treat this House with such want of respect as to try to get this Treaty signed to-morrow before anyone knows what is in it.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

By leave of the House I intervene now in order to answer questions which have been put to me in the course of the Debate. I quite realised that a Debate without papers being laid would be a very difficult thing, and I made the suggestion that the Debate should not take place till to-morrow in order that some papers might be before the House, but I understood that that was not wished, and I was anxious to meet the wishes of hon. Members. The paper will be laid to-morrow.

Mr. LLOYD GEORGE:

Will it be circulated with the Papers to-morrow?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I cannot actually say that. There is no mystery about this, and, as a matter of fact, we are not misleading the House by not giving a correct version of the Treaty. When you are in course of negotiations it is not a matter of one single draft, but of draft after draft being brought forward for discussion, and being altered, and changed, and re-written. I do not think it would afford the House the smallest enlightenment if I were to give them any of the many Clauses that have been under discussion, and it is much more satisfactory that they should arrive at a decision when they have had the full document before them. On the whole, I must say I thought I should be in for a very much rougher crossing than I have had. I thought that I should be drenched with criticism, that I should be entirely unable to answer. Instead of that, I feel greatly encouraged. With the exception of the hon. Member for the City of London (Mr. E. C. Grenfell), who made a very interesting and serious contribution to the Debate, there was really nothing in the very eloquent and violent language which was levelled at this proposal and the method by which I had informed the House of it. The right hon. Member for Canterbury (Mr. R. McNeill), with his knowledge of the Foreign Office, really made a most curious statement about the habitual practice in regard to treaties. Treaties are not discussed in the middle of negotiations.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

I was speaking entirely of the pledges given in this particular, and having regard to the statements of the hon. Member himself as to the line of policy which he would pursue.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

The promise made was that Papers would be laid, and the only Paper of any use would be the Treaty itself, which could only be laid after it had been signed, or at the moment of signature. This is being done. The right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) made a very telling and interesting speech, and he received the most uproarious cheers I have heard for a very long time from hon. Members opposite. He fortunately had no looking-glass in front of him to notice the features of the hon. Members behind him. He taunted me, but I do not think there is anything of great substance in what he said. He actually asked that the Papers that are to be laid before the House should be published previously in the newspapers to-morrow morning, as if that was a possible suggestion to make, as if we could send to the newspapers documents which it was the right of this House to have first. He then got into a turbulent state of indignation with regard to the statement I made on the subject of the Russian war debt, and he scoffed at the idea that the Russian war debt should ever be written down or reserved. It happens that at Genoa he made both propositions himself.

Mr. LLOYD GEORGE:

I asked for information as to what it was to be written down by. At Genoa there was agreement between all the Allies—France, Belgium, Italy, as well as this country. There the actual figure was agreed to between all the Allies, and the figure was a specific one in respect of certain compensations. But the figure is not given here, and I ask now, will the hon. Gentleman tell us what the figure is?

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I have no right to complain of the interruption of the right hon. Gentleman. The questions of the Russian War Debt arid of the Soviet counter claims have both been reserved. There were some specific questions asked me by the hon. Gentleman who has just sat down. He complained of the darkness which surrounded this subject. I own I have not had my full share of the limelight lately. There were other events of a more interesting and, perhaps, more important character going on, and the newspaper men mostly passed me by with their notebooks and with their cameras, in order to see the more important people and write about them. I really do not think I ought to be blamed for not forcing myself on the newspapers, and for not insisting on the Press visiting me daily at the Foreign Office. I have always been ready to give them any information I can, but there has been no sort of publicity about these negotiations. The negotiations have been very largely conducted by way of conversations, and when these conversations took place I have not invited a score of pressmen to come along and watch me. The important point is that the House of Commons should have the full facts before them. The important thing with regard to the loan is that the House of Commons will have full control over it. There is to be another Treaty arising out of this Treaty which is to be discussed, and there will be a Financial Resolution and a Bill, which means six stages for discussion before the loan materialises. Therefore, this House has got complete control, and will have ample opportunity for discussing it, whenever it wants to. The hon. Member for the City said he was very doubtful whether we should be fortunate enough to get the money raised, even with the Government guarantee, and anything on a subject of this sort coming from him one is naturally disposed to treat seriously.

Photo of Mr Edward Grenfell Mr Edward Grenfell , City of London

I am afraid I did not make myself clear. What I said was that if you do raise a loan here, it will reduce the amount for other purposes, and that if you place a loan in a country where there is very little probability of it being returned, you had better lend the money direct out of your own pocket rather than issue it as a guarantee.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I did not misunderstand the hon. Member. It was the last part of what he has just stated that I was referring to. He said: "Be under no illusions about your guarantees. It will mean your having to pay money yourselves." There are three settlements to be made before the loan can materialise, and if the Government are satisfied on those three points, that is to say, if the bondholders have been fairly met, that there is a lump sum to meet miscellaneous claims, and that the property owners have had a settlement which is satisfactory and which the Government can accept, that will make a great difference to Russian credit. It will be seen that the Soviet Government really mean to pay up. I think the whole attitude of the hon. Member himself, and the City, and the financiers, will undergo considerable change. I have been very much interested at the attitude of what is called "the City." People are apt to talk of the City as if it were an entity or an individual. It is composed of a lot of sections, and these sections are not by any means co-operating. They are very often acting in direct conflict.

There are three sets of people I have come across. There are the people who are interested in the debts because they want payment—immediate payment and immediate cash. There are the people who are interested in the bonds, but they do not want immediate payment; they do not believe the Soviet Government is going to last, and they are ready to wait a year or a generation in order eventually to realise, if they can, 100 per cent. Then there are people who have no debts, who are not interested in the bondholders or the property owners, but they believe in the future of Russia; they believe in the enormous potentialities of Russia and are very anxious to put new money into Russia. All those three sections are working in the City, and when I come across one man with a gloomy face, I go round the corner and see another man with a cheerful face. It has been very enlightening, but it has by no means discouraged me in the task which I have been trying to carry out. The hon. Member who has just sat down contrasted the procedure on this matter with the Inter-Allied Conference. I do not think there is any analogy between the two. When the Prime Minister decided to rest this matter on my shoulders, I felt it was a very great responsibility, and that it would be difficult for me to justify it in the House of Commons. I felt, also, that I could trust the generosity of the House of Commons not to regard my position as absolutely untenable.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

I would like to ask my hon. Friend, as he is speaking about his position, whether he is prepared to accede to the request of my right hon. Friend the Member for Erdington (Sir A. Steel-Maitland) regarding adjourning this Debate in order that the Prime Minister may consider—

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I do not think I am prepared to do that. Judging by the Debate I do not think there are any points raised which would justify the Prime Minister in leaving his present work to intervene here. Moreover, on the Adjournment it will be quite possible to continue this subject if need be. No doubt the business might be adjourned in order that the Prime Minister might answer any question which might be addressed to him.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

The point of the question does not lie in the continuation of this discussion. The point raised by my hon. Friend the Member for Erdington (Sir A. Steel-Maitland) was that, under all the circumstances of this Debate, if it were known to the Prime Minister, he would probably take the decision that it would be unwise to sign this Treaty to-morrow.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I feel quite confident that, when I give an account of this Debate to my right hon. Friend, he will offer me his hearty congratulations. I do not think there is any other point on which I need touch.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

There is the question of the territorial waters for the fishing fleet. Will our fishermen be allowed to fish up to three nautical miles of the Russian coast?

11.0 P.M.

Photo of Mr Arthur Ponsonby Mr Arthur Ponsonby , Sheffield, Brightside

I want to make it clear that the territorial waters question is not settled. [An HON. MEMBER: "What is settled?"] I do not suppose hon. Members opposite, or in any part of the House, thought that this was going to be an International Convention for the settlement of the territorial waters question. There are other hon. Members who want to continue this Debate. I feel I have been handicapped to a large extent by not having the draft of the Treaty laid before the House in its printed form. I feel that when this Treaty is examined, hon. Members will see that it is a very great advance on the lines towards a reconciliation between these two countries. Really, I think, there is a little bit too much scoffing at Russia, and a tendency to consider that the whole Russian people are represented by one or two Members of the Soviet Government. I have never pretended that the Soviet Government offers any kind of attraction for the British people, but it should be recognised that there is a great difference in temperament between us and the Russians, and we should not judge them according to our own standard. Their system of Government is very different from ours, which is gradually drifting away from being capitalistic. The adjustment of the differences in the systems, laws and political institutions of the two countries has been one of the great difficulties which I have had to encounter in coming to this agreement. I believe that what has been done will not only benefit Russia and increase her credit and trade, but it will do a great deal to lessen the heavy burden of unemployment in our country. Most of all it will bring about a reconciliation and a healing of wounds which will make all other problems a great deal more easy to deal with in the future.

Photo of Mr Worthington Evans Mr Worthington Evans , Colchester

We have just listened to another interesting speech from the Under-Secretary, and I congratulate him upon his imperturbable serenity. I hope, however, that the Government is not going to let this country down. The Government appear determined to sign this Treaty in face of the fact that there appears to be a majority of the House of Commons against it. That is how it appears to me. They are taking a course which, in my view, will be understood by the Russian people to mean that this is an agreement to guarantee a loan to Russia. I remember what happened in this matter in the days of the Genoa Conference when the only condition upon which the Russian representative would consider any admission of debts or responsibility for the past was that we should make a Government loan to Russia. They have always claimed that whatever they may do in the way of recognition of past indebtedness shall be a sum lower than that which they can borrow in this country. If we allow the Government to proceed to sign this Treaty it is going to mislead the Russian people. The Prime Minister not being present at these Debates, does not realise the responsibility that the hon. Gentleman is lightly taking on his behalf. The Prime Minister ought to be here in this House before he determines to proceed with these negotiations. I therefore ask you, Sir, to accept a Motion for the Adjournment of this Debate, so that it may continue to-morrow in the presence of the Prime Minister.

Photo of Mr John Clynes Mr John Clynes , Manchester Platting

Before any decision is given by you, Sir, on that request, may I submit, or recall, that about 4 o'clock to-day I drew attention to the inevitable absence of the up-to-date Paper on this question, and to the fact that there might be some question raised as to the desirability of not proceeding with the Debate. I submit that, having continued the Debate for this length of time, it is scarcely reasonable to argue the view that we should hear the opinion of the Prime Minister before the House rises to-night. I make the alternative suggestion that, if the opinion of the Prime Minister is desired on the subject of this Treaty before it is signed to-morrow, let a Private Notice question be put to the Prime Minister, which he can be here to answer to-morrow forenoon, and in that way all the desires of the House will be met.

Photo of Mr Ronald McNeill Mr Ronald McNeill , Canterbury

I suggest that the proposal which the right hon. Gentleman has made does not really meet the ease, because, as the right hon. Gentleman will see, a Private Notice question to the Prime Minister would not and could not put him in possession of the feeling of the majority of the House about this question. What we desire is that the Debate itself should continue in the presence of the Prime Minister to-morrow, assuming that he could possibly come to the House, in order that he might appreciate really the position before taking the responsibility for himself and the whole of his Government in signing this Treaty.

Mr. C LYNES:

Might I say further, that clearly it would be impossible for the Prime Minister to be here to-night for a period long enough to enable him personally to ascertain what is the feeling of the House. To-morrow morning is allotted for the Adjournment Motion—

Mr. LLOYD GEORGE:

On a point of Order. There is an important discussion going on in regard to a very important matter and a Motion for the Adjournment of the Debate has been moved. I submit that we ought to have your decision upon it, because there are a few of us who would like to put reasons to the Government why they should assent to this course before they take the very serious responsibility of signing a Treaty of the character outlined by the Under-Secretary.

Photo of Mr John Whitley Mr John Whitley , Halifax

In the first place, I may point out that the House may further pursue this question on the Motion for the Adjournment To-morrow. Secondly, I am debarred from accepting this Motion for the Adjournment of the Debate, because the House has already, earlier in the day, passed a Resolution instructing me what I am to do to-morrow.

Photo of Mr Leifchild Jones Mr Leifchild Jones , Rushcliffe

The right hon. Gentleman the Deputy Leader of the House and the Under-Secretary do not really seem to realise the point which is most pressing upon me, certainly, and I think upon most Members of the House, and that is that the Treaty should not be signed before the House has had an opportunity of seeing its terms. I understand that the offer of the Deputy Leader of the House is that the Prime Minister will come here before signing the Treaty, when we shall have had an opportunity of seeing the Treaty, which I understand will be published to-morrow morning before the House meets. That is really the point of most importance, and I want to press it upon the Government even at this last moment. I am not opposed to the Treaty. I have not seen it, but I have heard descriptions of it, and I have tried to follow what has appeared in the newspapers, and I believe I am in favour of and not against it. Certainly I am warmly in favour of reaching an understanding with Russia, if it can possibly be reached. But I do say that, with other Members on the Labour Benches, I have time and again complained of Governments signing treaties behind the back of Parliament, when Parliament had not seen them. Now what is the extraordinary position in which we find -ourselves? Here is a treaty, and the Government know what the treaty is, and what arrangements they have reached. It is not yet signed, and they are in a position to do what they have said again and again that they intended to do—to scrap the old procedure in regard to these treaties. It has been urged against hon. Members opposite by the Under-Secretary that they are following the old practice, but we have condemned the old practice continually.

Now they have the Treaty ready; it is in their hands; it is not signed. What possible argument can they give to us for withholding it from the House before they have signed it? I appeal to them, therefore, to let us have it to-morrow morning, and, when the House meets, let the Prime Minister be here, and let us have the opportunity to raise any points on the Treaty that may occur to us. It can easily be done, even after the Resolution that has been passed to-day. Then they will sign the Treaty, as I am convinced, with the support of a majority of the House, instead of signing it without knowing the opinion of the House in regard to it, and thereby taking away from it a great part of the sanctity which we attach to it. If we get the Treaty in time to enable us to express an opinion in regard to it before it is signed, I think the Government will have fulfilled their undertaking to the country; but if, when the House meets to-morrow, before the Treaty is signed, and if, having in their possession the Treaty which they can submit to the House, they still withhold it from the House and insist on signing it with the House in ignorance of what is in it, they are not fulfilling the promises which they made to the electors.

Photo of Mr George Bowyer Mr George Bowyer , Buckingham

On a point of Order. You have said, Sir, that you yourself were confined by the Order of the House as to what should take place to-morrow. Is not the Motion regarding to-morrow—which is headed, not "Adjournment of the House," but "Business of the House"— That this House do meet To-morrow, at Eleven of the Clock; that no Questions shall be taken after Twelve of the Clock; that Mr. Speaker shall not adjourn the House until he shall have reported the Royal Assent to the Acts which have been agreed upon by both Houses;"— I submit that that does not refer actually to what is the business of the House, except anyhow between the hours of Eleven and Twelve; and I would submit, further, that it does not lay down what the business is, except that the business of receiving the Royal Assent Acts of Parliament.

Captain BENN:

On that same point of Order. May I read the rest of the Resolution, which the hon. and gallant Member did not read? It goes on— but that, subject to this condition, Mr. Speaker, at Five of the Clock, shall adjourn the House without Question put. If that happen, all that we do is to meet the next day, in order to carry any further Adjournment Motion for the holidays. Therefore, I submit to you, with respect, that there is nothing in this Resolution which would prevent to-morrow being devoted to the continuance of the Debate on this matter.

Photo of Mr John Clynes Mr John Clynes , Manchester Platting

I quite agree with the view that there is nothing in the Motion to prevent a continuance of the Debate to-morrow. But I am assuming that there are many Members who are interested in other questions, and look forward to to-morrow as an opportunity to debate them. [HON. MEMBERS "Friday!"] I have no objection whatever to that. As to the Prime Minister, I shall represent to him the view of the House with regard especially to the point of the Government not signing the Treaty until hon. Members have had the opportunity that has been promised. That is only in keeping with the earlier announcement. I should hope, having given that assurance, and as, probably, the Prime Minister will be here to-morrow for at least some short period of time, we may secure the Third Reading of the Appropriation Bill.

Photo of Mr Arthur Steel-Maitland Mr Arthur Steel-Maitland , Birmingham Erdington

May I make a suggestion? The ratification cannot take place until the Treaty has lain 21 days on the Table and the right hon. Gentleman has given an undertaking that there shall be an absolutely free and full Debate on the ratification. As that will have to be 21 working days after the House has re-assembled, it will really make no difference if the Government do not sign the Treaty until the House reassembles if need be.

Mr. LLOYD GEORGE:

It has been pointed out that this Motion does not indicate the business to be taken tomorrow. It simply decides that we shall rise at five o'clock and meet at an earlier hour. The Government, in the ordinary course, would put down the business to be taken to-morrow. Their intention was to put clown the Motion for the Adjournment. I believe there is an alternative proposal which is to be submitted. That will be put down at the end of to-day's Sitting. Instead of doing that, if they assent to the adjournment of the Debate on the Appropriation Bill, that will be taken and the Motion for the Adjournment could be taken on Friday. It is very important that the House should have a full opportunity of discussing the matter.

Photo of Mr Worthington Evans Mr Worthington Evans , Colchester

May I submit to you, Sir, that you take the Motion for the Adjournment of the Debate so that we can get an opportunity of hearing the Prime Minister to-morrow, and then indicating what the view of the House is after hearing the Prime Minister, so that he may feel whether or not he is justified in signing this Treaty, or whether it would not be better to postpone it till nearer the ratification? I think, on the point of Order, it is competent to adjourn the Debate. The Appropriation Bill can be put down for to-morrow and the Adjournment Motion either taken after it if there is time or on Friday or some other suitable occasion.

Photo of Lieut-Colonel George Woodwark Lieut-Colonel George Woodwark , King's Lynn

The Prime Minister was in the House ten seconds ago and has now left.

Photo of Mr John Clynes Mr John Clynes , Manchester Platting

Our securing the Third Reading of the Appropriation Bill to-night will in no sense interfere with the continuance of the Debate to-morrow on the Adjournment Motion.

Photo of Mr John Whitley Mr John Whitley , Halifax

I think if the Debate be adjourned to-night, the adjourned Debate will clearly be substituted for the Adjournment Motion to-morrow. I have already been instructed to adjourn the House as soon as the Royal Assent has been given to Acts agreed upon by both Houses—not before five o'clock in any case; it may be later. I think that would be the effect of it. Since that is so, I think that would not conflict with the Motion already passed by the House this afternoon. For that reason, I shall propose to submit to the House the Motion suggested by the right hon. Member for Colchester (Sir L. Worthington-Evans).

Photo of Mr Worthington Evans Mr Worthington Evans , Colchester

I beg to move, "That the Debate be now adjourned."

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

I think the right hon. Member for Colchester (Sir L. Worthington-Evans) has truly interpreted the real wish of the Conservative party, and that is to prevent a settlement with Russia.

Photo of Mr John Whitley Mr John Whitley , Halifax

That is not in Order on this Motion.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

If we adjourn this Debate, there will be no opportunity for the House to show its opinion by a vote, because I do not think the House ever votes against the Appropriation Bill. It would stop every service of the Government. The only object, therefore, is to delay proceedings in regard to Russia. The Motion for the Adjournment of the House gives every opportunity to the House to raise these matters, and the right hon. Member for Colchester is seeking, not to get further time for discussion, but to stampede the Government—

Photo of Mr John Whitley Mr John Whitley , Halifax

The hon. and gallant Member must keep to the Motion before the House.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

Am I to understand that on the Motion for the Adjournment of the Debate I am out of Order in showing that this is an attempt to prevent this Russian business proceeding? I shall resist the Motion for the Adjournment. There is no practical advantage in adjourning this Debate on the Appropriation Bill, because there can be no division on the Bill. Therefore, I submit that the object to prevent the Government from signing the agreement is not constitutionally practicable. As long as a Government is in office, it appoints certain persons to carry out instruments in the name of His Majesty. The House can ratify afterwards. It cannot prevent a Government signing any sort of instrument it chooses. Therefore, the only effect of this Motion is to delay the Third Reading of the Appropriation Bill, and it cannot possibly affect the question of whether this Treaty is to be signed or not. The question of ratification is not affected in any way, and I hope the Government will not be intimidated by this attempt. They have more to fear from the rank and file of their own movement in the country, from the work-people, than they have from hon. Gentlemen opposite.

Photo of Mr John Remer Mr John Remer , Macclesfield

The hon. and gallant Member has given a very novel reason why the Debate should not be adjourned, and I am going to use the very argument which he has given, as a reason why the Debate should be adjourned. The Treaty is to be signed by a Government who have not a majority in this House, and who stand here, obviously, faced with a House to-night which is hostile to their proposals. [HON. MEMBERS: "No!"] There have been speakers from this side and from the other side, including the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George), opposed to the proposals. Therefore, this Motion of the right hon. Gentleman the Member for Colchester gives the House of Commons an opportunity of expressing their opinion as to whether this Treaty should be signed to-morrow or not.

Photo of Mr John Whitley Mr John Whitley , Halifax

The reason why I have taken the unusual course of accepting the Motion of the right hon. Member for Colchester was that the printed document was not in the hands of hon. Members.

Photo of Mr George Lansbury Mr George Lansbury , Poplar Bow and Bromley

I wish to oppose the Motion for the Adjournment of this Debate. For good or evil, the House has allowed the Labour party to nominate Ministers to accept the position of government in this country. Certain negotiations have been going on between the Russian Government and the British Government. Certain other negotiations have been going on between the British Government and the Allies in the late War, together with our late enemies. No one in this House has said that before the Prime Minister as Foreign Secretary signed the agreement with France, Italy, Belgium and other countries, it must first come here. Everybody knows that it will come here afterwards to be ratified. [HON. MEMBERS: "No!"] We have had Debates on that subject, but we have not given the Foreign Secretary instructions as to what he was to do when he meets these gentlemen whom he is meeting, and you have no guarantee as to what he will sign, or will not sign. Therefore, you have left the Government a free hand. But on this particular question you have allowed the Government to go to the point of agreement—

Photo of Mr George Lansbury Mr George Lansbury , Poplar Bow and Bromley

It is said that if this Treaty be signed and then thrown over, it will be looked upon as a breach of faith by the British Government. After four months of negotiation, a settlement has been reached. The ordinary proceedings have taken place, and the document is to be signed. Now the right hon. Gentleman says that it is necessary to break faith with the men with whom you have been negotiating. He may say that the House of Commons is going to disagree with what the Government have agreed about. I say that if the Liberal party and the party opposite have come to the conclusion that the Government are not fit to carry on these negotiations, the proper course to adopt is to do the constitutional thing, and throw out the Government.

Photo of Colonel Sir Joseph Nall Colonel Sir Joseph Nall , Manchester Hulme

On a point of Order. In view of the ruling which you, Sir, have given with regard to hon. Members pointing—[HON. MEMBERS: "Order!"]—will you call on the hon. Gentleman opposite not to point?

Photo of Mr John Whitley Mr John Whitley , Halifax

I did not observe him. It is always my request to hon. Members that they should address me, and not hon. Members opposite. That applies to all speakers, and is an ancient Rule, in this House.

Photo of Mr George Lansbury Mr George Lansbury , Poplar Bow and Bromley

I was not aware that I was offending against that rule. I did what is done by thousands of men and women who speak—using my hands to emphasise my remarks. I am perfectly serious in this, because I think an attempt is being made to-right to browbeat Ministers, and to force them to do, not what they wish to do, but what certain people in this House want them to do. If the Government are to retain a shred of self-respect, they must make a stand. No Government worthy of the name ought to allow themselves to be bullied in the way that has been attempted to-night. I hope that the Prime Minister and the rest of the Government will stand firm, and that to-morrow morning they will sign this Convention, unless the House decide otherwise now by its vote against the Appropriation Bill. Although it is unusual, that is the constitutional way of showing disapproval of the Government. Let the House, if it choose, throw out the Appropriation Bill, and then let Parliament pass the whole of the financial business over again, or go to the country. I am sick and tired of hearing hon. Members who dare not take the only and the proper course of challenging us before the country on these matters by allowing such a vote to be taken. I am certain that, whatever right hon. and hon. Members all around may think, this attempt to trade with Russia, to establish proper relations and peace with Russia, would sweep the country.

Photo of Mr Hugh Ferguson Mr Hugh Ferguson , Motherwell

That is an attempt to frighten the Liberals.

Photo of Mr John Clynes Mr John Clynes , Manchester Platting

The course suggested by my hon. Friend who has just spoken might truly be described as very heroic, but, really, it would not help Russia. Those who act for the Government in this matter must admit two things. One is that the White Paper which has been asked for and has been promised ought to he in the hands of Members before this Treaty is signed. I hope that none of my hon. Friends behind me would question that.

Photo of Mr John Clynes Mr John Clynes , Manchester Platting

The other is that there is no question whatever of signing this Treaty in the morning. I would not like to be a party to any policy of "rush" which would seek to sign the Treaty against the will of the majority. We shall not be able to test the real Russian issue by such a vote as that which is now suggested—the Adjournment of the Debate. I rose to say that I have been able, since I spoke last, to communicate with the Prime Minister, and in view of the two points which I have just enumerated, and the evident desire of the House that the Prime Minister should be heard on this question before the matter is concluded, the Prime Minister has intimated to me that he thinks the best course would be to accept the Motion for the Adjournment of the Debate, and to resume it to-morrow, in the hope, of course, that the House will be able to adjourn, in the terms of the Motion, at Five o'clock.

Photo of Mr Benjamin Smith Mr Benjamin Smith , Bermondsey Rotherhithe

On a point of Order. May I inquire if the Question to be put is, "That this House do now adjourn," or "That the Debate be now adjourned"?

Photo of Mr John Whitley Mr John Whitley , Halifax

"That the Debate be now adjourned."

Debate to be resumed To-morrow.