Government of India Act, 1935, and Government of Burma Act, 1935.

– in the House of Commons on 12th November 1936.

Alert me about debates like this

8.7 p.m.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I beg to move, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 309 of the Government of India Act, 1935, praying that the Government of India (Federal Court) Order, 1936, be made in the form of the draft laid before Parliament. It might be for the convenience of hon. Members, before we tackle this list of 12 Orders in Council, that I should say a word or two about them in general and make a suggestion about the manner in which they should be taken by the House. I suggest that we should take the first Order with what I hope will be a short discussion alone, and that we should then take, in another short discussion, prefaced by a few explanatory remarks by myself, the two Governors' Allowances Orders for India and Burma, which cover the same ground, that we should then take the two Audit and Accounts Orders for India and Burma, which cover the same ground, that we should then, if hon. Members opposite agree, take, with suitable introductory remarks, the other smaller Orders in a fourth block, leaving to the fifth block the single Order relating to Family Pension Funds. If hon. Members opposite accept that, I think it will be for the convenience of the House.

May I say just a word about the Orders in general before coming to describe the Federal Court Order? The Orders have been arranged in this order partly through an effort to meet the convenience of the House and partly through a wish expressed by some hon. Members that the last Order on the Paper should have an opportunity of being discussed without feeling that there was other business following it which might prejudice its discussion. I do not mean by that to say, however, that it is more important than the other Orders, because I believe hon. Members opposite are interested in some of the earlier Orders, and they will therefore have a full opportunity of discussing them. I shall endeavour to point out the meaning of each Order in the case of which there is a corresponding Order for Burma by explaining the Indian Order shortly.

The Government very much hope that we may be able to get all these Orders this evening. They are all being submitted to the House according to the terms of the Government of India Act. The Orders in fact contain what I may describe as no new principle, in that they are all governed by the terms of the Act, but they do implement in some detail important decisions taken in the Act, and I realise that hon. Members would therefore wish to interest themselves in the details. If I may say so, they are less formidable than they look. They are a long list, but in most of the cases they implement in detail decisions already taken by the House during the last Session. I realise that there are many hon. Members who may not have been in the last House, and to them these details may not be familiar, and if I can assist the House by making some preliminary observations, I shall be only too glad to do it. If I do not cover all the points in my opening remarks, hon. Members have only to put questions for me to attempt to do my best to answer them.

The first Order, the Federal Court Order, is necessitated by the fact that Provincial autonomy will, under the Commencement Order approved by Parliament, be started on 1st April next year. The Federal Court is charged under the Act with the duty of interpreting the Constitution and settling disputes between the Centre and the Provinces as to their respective jurisdiction. The necessity for a Court, therefore, will make itself little less felt under this Provincial autonomy than when the Federation itself is in being. It is impossible to foresee how soon after the commencement of Part III of the Act cases falling in the jurisdiction of the original or appellate court will be ripe for decision, but it is clear that a small bench of judges must be available within a few months after the establishment on 1st April next, and the purpose of this Order is, therefore, to bring into force the relevant provisions of the Act for that purpose.

Hon. Members, on studying the Order itself, will find that the conditions governing the salary of the Chief Justice are included in paragraph 4 and that the rest of the Order confines itself to describing the various other leave allowances and privileges of the Chief Justice. There are certain details connected with the other judges which are not included in this Order, but we wish to proceed with the Order in order to be able to proceed with certain preliminaries in the establishing of the Court, which is necessitated, as I have described, by the establishment of Provincial autonomy. Paragraph 3 has a certain importance. It brings into force the whole of Chapter 1, Part IX of the Act relating to the Federal Court, with the exception of two Sections, and it may perhaps assist hon. Members if I describe why these two Sections have been omitted.

The purpose of Section 206 was to enable the Federal Legislature to set up a Supreme Court. I remember that when I was a member of the Joint Select Committee we discussed this matter at some length, and the ultimate decision was to leave it to the future Federal Legislature. There is no value in bringing into force that particular provision before the future Federal Legislature is set up, because the Joint Select Committee, and Parliament itself, in the Act, decided that the question of the Supreme Court must rest with the future Federal Legislature, and if there is no Federal Legislature, it is clearly undesirable that the Central Legislature should be given an opportunity to begin to consider this question before Federation itself is established. That is the reason for excepting Section 206.

There are somewhat similar considerations applying to Section 215, which is also excepted from this Order. This Section enables the Federal Legislature to confer on a Court such supplemental powers, not inconsistent with any of the provisions of this Act, as may appear to be necessary or desirable for the purpose of enabling the Court more effectively to exercise the jurisdiction conferred upon it by or under this Act. Here also we feel that there is no necessity for invoking this Section so early in the course of its career, and it would be preferable that this power should be in abeyance until Federation is started and the Federal Legislature established. I have referred to the other Section which settled the conditions of service of the chief justice, and I think that with that explanation I have covered the salient points in the Federal Court Order. The Attorney-General is here in view of the importance of the question, and if there are any questions which hon. Members wish to put to him, he will be only too pleased to answer them.

8.17 p.m.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

In prefacing his remarks to the proposals which are being laid before the House, the Under-Secretary suggested a. certain procedure with regard to the discussion of the various Orders. Speaking for those who sit on these benches, I see no reason to quarrel with the proposal he makes in that respect. If we have a, discussion of these Orders in that way, and you, Sir, are pleased to accord your approval, I think that it will probably he for the convenience of the House.

Photo of Mr Robert Bourne Mr Robert Bourne , Oxford

If it is the general wish of the House, it would seem to me the most satisfactory way of conducting the business.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

With regard to these Orders as a whole, the position of those who sit on these benches is broadly this, that in the last Session of the previous Parliament the India Act was carried into law, and that, although there was a considerable divergence in the House on the provisions of that Act, and we on these benches by no means found ourselves in support of the Act as a whole, we recognise that the Act is now law and that these Orders are being made in conformity with it. As long as they fulfil that purpose, we, obviously, cannot raise over again the points on which we were at variance with the Government in the passing of the original Act. Therefore, so far as these Orders are concerned, it must be, in the main, a question of detail rather than of principle which we can discuss.

With regard to the first Order on the list, we recognise, of course, that the appointment and the conditions of appointment and service of these judges must necessarily be provided for. I would like to ask one or two questions with regard to these appointments. I do not think it is stated in the Order how many judges it is proposed to set up, and I should be glad if we may be informed on that point. I am not clear from what the Under-Secretary said whether these judges are entirely new appointments; whether judges who are at present in India carrying through the functions whch they have now to perform will be transferred to these appointments, or whether in fact the total personnel of the judges in India will be materially altered by this Order. This is an important point, because we shall then know how far the effect of the Act and of this Order will be seriously to enlarge the personnel of the courts of justice as they will be involved in India in future. The rest of the Order seems to me to follow fairly obvious form, and the only remaining question is whether the conditions of service applying to the judges in the Order are on all fours with the conditions of service of the judges in India at the present time.

8.21 p.m.

Photo of Mr Donald Somervell Mr Donald Somervell , Crewe

In answer to the first question which the hon. Gentleman put to me, the intention at the moment is to appoint a chief justice and two judges. It is thought that that will be sufficient for the work that will fall on the court at present in the somewhat early days. The actual provision in the Government of India Act is that a federal court should consist of a chief justice of India and such number of other judges as His Majesty may deem necessary. I am sure the House will appreciate that it would have been impossible to put in a definite limit in the Act. The duties which the Court will have to perform necessarily cannot be foretold accurately in advance. There are enabling provisions in the Act by which the Federal Legislature, if and when it is set up, can confer additional powers on the Court. Therefore, the provision has to be elastic enough to enable a sufficient personnel to be established from time to time in order that the Court may efficiently carry on its duties.

The second question which the hon. Gentleman put was whether the Indian judges would be transferred to this Court, and whether the setting up of the Court would enlarge the personnel of the courts in India as a whole. It is always difficult to prophesy, but I think that it would be agreed that the fact that this court has to be set up to deal with the new problems which the new Constitution involves does not necessarily mean that there will be less litigation in the ordinary Provincial courts. The amount of litigation and the need for judges goes up and down for reasons which I have often heard discussed but never satisfactorily formulated. Whether the introduction of this new Constitution will for some intangible reason decrease the litigious claims in India or increase them, is a thing on which it would be rash to prophesy. The bulk of the work of this Court will be new work caused by new precedents arising out of the fact that there will be a Federal Constitution and possible disputes between the Centre and the Provinces.

The hon. Gentleman's final question was whether the conditions here were, broadly speaking, similar to those which apply to judges in India. The salaries of these judges is somewhat higher than the salaries of the chief judges of Bengal, but I think the position of the Chief Justice of the Federal Court should necessarily carry a somewhat higher salary than in the case of Provincial High Courts. All the conditions are not verbatim the same, but, broadly speaking, the conditions as to allowances, equipment and so on are substantially the same.

Ordered, "That the Debate be now Adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

8.26 p.m.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I beg to move, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 309 of the Government of India Act, 1935, praying that the Government of India (Governors' Allowances and Privileges) Order, 1936, be made in the form of the draft laid before Parliament. In moving this Order it may be advisable for me to explain to the House the reason why I asked for the discussion on the previous Order to be adjourned. It is essential that an Address to His Majesty from both Houses of Parliament should be presented in the same terms, and as that Order has to be considered in another place we cannot to-night come to a final decision on it. That Order will come before the House again for final approval. The Motion now before us deals with India, and there is a similar Motion on the Order Paper dealing with Burma. The hon. Gentleman opposite agreed that it would be for the convenience of the House to consider the India Order and the Burma Order together. The object of these two Orders is to lay before the House the provisions for the allowances and privileges of Governors in His Majesty's Indian Empire. The provisions in the Burma Order differ from those in the Indian Order chiefly in that they include a revised provision for the Governor's salary. The Governor's salary is to be raised by an amount which, while it is not a very large amount, will make it equivalent to the salary given to the Governors of those old Presidencies of Madras, Bombay and Bengal. I think that proposal will commend itself to hon. Members when they realise that the Governor of Burma will, in future, be the Governor of a separated Burma with a Constitution of no less status than that afforded in general to India. Therefore, it is important that the Governor should receive a salary worthy of his position as Governor of a separated Burma.

The provisions of the Indian Order are somewhat interesting in that, for the first time in the history of British government in India, the whole of the allowances and privileges of the Governors are collected together on one sheet of paper. The history of the government of India, as hon. Members will not need telling, is an old one, and the history of the allowances and privileges given to our rulers or Governors in India is also an old one. I have read a statement of the East India Company referring to its own servants in which it referred to the noble appointments settled upon the Governor which are intended to take in all the expenses he may be put to on the company's account. That seems to have been the principle of the East India Company, and that is the principle of the Government at the present day, carrying on the ancient tradition of enabling a Governor to fulfil conveniently and with dignity the duties of his office. The whole object of this Order is to enable the Governor, and each Governor is specified in the Order, to fulfil conveniently and with dignity the duties of his office. The Order in detail deals first of all with the sums to be paid to each Governor for equipment and the voyage and for official motor cars on appointment. Those details are to be found in paragraph 4, and in the Second Schedule. The Order also specifies the residences to be used rent free by each Governor; all that is defined in paragraph 3 (Definition), paragraph 5 and in the First Schedule. In discussing these ancient houses I was tempted to look up again Lord Curzon's "British Government in India." He describes the romance of an old house, whether it be attached to a family or attached to a Governor, and says of the Government houses: The house has, so to speak, a new lease of life and a fresh opportunity for adventure with each recurrent wave every four or five years. As one fugitive occupant after another disappears it alone survives as a witness to their career or fortunes. They vanish in the generations of man almost as swiftly as a meteor in the sky. But their trail still lingers behind them in the places which they inhabited and the walls are left to tell with silent eloquence the tale. That is particularly true of our ancient Government houses in India, and I feel that it would have given great satisfaction to the Noble Marquess if he had realised that the Government house at Barrackpore which he loved so well is now to be included, after more than a century, as an official residence of the Governor. He reminds us that for more than a century Barrackpore, for the first time included in an Order-in-Council, was the rural resort of the Governor-General, and thither up the river or by the road has moved a long procession of all the best and bravest in India. He reminds us also of the many important and serious decisions taken there which made our Indian Empire what it is. I think it is a source of satisfaction to feel that it is scheduled as a residence of the Governor.

The third object of the Order is to enable provision to be made for the upkeep of these residences, to which I attach some importance. The furnishing of these residences is dealt with, in particular, in paragraph 6 of the Third Schedule and paragraph 7 (1 a) read with the Fourth Schedule. I am attempting to give hon. Members an opportunity of following the manner in which the Order is made up. In paragraph 7 (1 a) and the Fourth Schedule provision is made for certain forms of expenditure, first for the Governor's household staff, including the Presidency bodyguard, medical establishment, etc.; secondly, his entertaining expenses, referred to in the sumptuary allowances; thirdly, his miscellaneous expenses; and, fourthly, his touring expenses. One general observation is important at this stage, and that is to point out that the sums in all the Schedules are maxima, except those in the Second Schedule. It may be expected that the actual expenditure will not exceed these amounts and will probably fall below them, with the possible exception of the sumptuary allowances.

Hon. Members will be interested to know whether in this Order we are taking the opportunity to increase the amount. My answer in general to that would be that in fact this Order consolidates the existing position, and that in hardly any ease is there any increase. I have referred to a certain house scheduled as the Governor's residence, and there are two other small examples, the houses at Netarhat and Jubbulpore. Those are additions to the Order.

The chief figures which are additional and new are those which provide for the new Provinces of Sind and Orissa. Those figures have naturally not appeared before, since these are new Provinces. With the exception of these, the figures are almost identical with those that have been produced before. There have been one or two minor adjustments in the case of the staff of the Governor, but in no case has any substantial increase been made. As regards the other figures in the Fourth Schedule, they are the dearest and easiest to follow owing to the manner in which the figures have been worked out upon the average of the last five years. I hope that that explanation will give hon. Members an opportunity of appreciating the Order in Council for India. In regard to the Order for Burma, I have described the chief change. There is one other small change in regard to the State Fund, which I do not think is more than a technical point. I hope that hon. Members will now allow the Order to pass.

8.37 p.m.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

I have listened to the explanation given by the Under-Secretary and I appreciate, as in the case of the previous Order, that we are here entrusted with the implementing of the Clauses in the Act to which these Orders are attached. I further recognise that, if we are to have Governors in Burma and India, obviously they must have a certain state which they must keep up. What I am concerned about is whether it is necessary for them to have a considerable number of official residences which might add very considerably to the cost involved. I was rather distressed to hear from the Under-Secretary that we were actually adding to the existing residence. I could readily understand in Burma, where the situation is becoming different, that certain additions may be required, but I cannot quite understand why in Bengal it should be necessary to increase the residence provisions for the Governor and thereby necessarily add considerably to the expense.

I was glad to hear the hon. Gentleman say that these are maximum figures in the majority of cases. Throughout the world in these days the tendency is to reduce ceremonial expenditure of the courts of the world, and it would be a very unhappy thing if the granting of this measure of self-government in India were accompanied by the placing of additional burdens upon the backs of the people of that country. We have to remember that we are trustees for the people. Though there are a certain number of very rich houses, in the main these people are one of the very poorest in the world. In view of that, we ought not to impose upon them any burdens which could reasonably be avoided. We should have a little more explanation by whoever is to reply, as to why it has been found necessary to add even to this small extent to the palaces in which the Governors are to live. I should have thought that it might have been found possible somewhat to reduce the number of Governors' residences, and therefore to reduce the burden. I should like to be told how far it may be possible in later years for the people in India to reduce the cost of these institutions with which we deal in this Order.

8.41 p.m.

Captain CAZALET:

While appreciating the object of the hon. Member's remarks that no unnecessary extravagance should be encouraged, I think that if he recognises the conditions of the Governor of Bengal to-day, he will recognise that it is essential for the convenience of the Governor to have some other residence outside Calcutta itself. While that residence is convenient in some respects, it is, in other respects, somewhat inconveniently placed. I hope that the Under-Secretary will not alter his views on that matter. I am certain that the people of India like to see their Governors' and their Government houses properly conducted. Poor as they are, they are willing to make such contributions from the Provincial Funds as will see that those establishments are properly maintained. When the Schedules in the Act were being discussed, I raised this question, and I am very grateful to the Government for meeting my points so fully. I feel that under these allowances and regulations, Governors can conduct themselves and their offices conveniently and with dignity.

The only real grievance we had before —it is remedied now—is in regard to personal effects. As I understand it, by Clause 9, although the Under-Secretary did not refer to it, it is possible that Governors—I do not know whether Commanders-in-Chief are covered—might in future take out to India certain personal effects which are purely for convenience to himself, family or staff and the dignity of his office, without having to pay the excessive Customs duties which he would have to pay to-day. One other small point is that I do not quite know how the Governor-General comes into this matter at all, or whether a special Order will have to be issued in regard to him. At present, the Regulations apply to the Viceroy and to the Governor-General. I see that paragraph (d) of Clause 9 of this Order deals with motor cars provided for the use of the Governor. I do not know whether the same motor car is regarded as his only means of conveyance, but it is most probable that, in the very large States, aeroplanes will in future be used. For the sake of drafting the Order anew, I wonder whether it would be worth going through the elaborate process of making a new Order, but it seems to me that aeroplanes should be encouraged in a country as large as India. I do not know whether this is the opportunity to alter the words so as to cover them.

8.44 p.m.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I will do my best to answer the points which have been raised by hon. Members. The additions to the list of Governors' houses is not so formidable as was suggested. I was seized with the romance of these ancient houses, but in reality the places mentioned in the Schedule have been Governors' houses for many years. The only slight difference is that technically, in the case of Bengal, they will have an additional Governor's house. Otherwise no serious additional burden will be imposed upon the Indian taxpayer. The hon. Gentleman also asked for a little more explanation as to whether this Order could be adapted by the Legislatures if any eventual alteration were needed, and I think a similar question was raised by my hon. and gallant Friend the Member for Chippenham (Captain Cazalet). The method of changing the Order-in-Council is by amendment of the Order, and, therefore, the contents of the Order would have to be amended by a fresh Order-in-Council.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

It would have to come before this House?

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

It would have to come before this House. The House will naturally interest itself in these matters. The hon. Gentleman expressed a wish to reduce the cost of these institutions. I understand his point of view, but, in the stress of life which government involves in India, we believe that these institutions are the minimum which will enable the Governor to carry out his duties con-veniently and with dignity, and, therefore, we have been forced to include them; but, as the hon. Gentleman will see, there are no very substantial additions to the list.

My hon. and gallant Friend the Member for Chippenham drew attention, very rightly, to the Customs privileges which were inserted in the Order in response to an Amendment which he moved while the Bill was going through. It is a source of gratification to me to draw the attention of the House to these additional privileges, which correspond with the privileges enjoyed by those who serve His Majesty abroad in a diplomatic capacity. Governors have been asking for them for many years. My hon. and gallant Friend asked whether the Commander-in-Chief and the Governor-General were included. The Commander-in-Chief is not included in this Order. The Governor-General has these facilities, and an Order is not necessary to provide him with them.

Captain CAZALET:

Is that under the Government of India Act?

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

He had them before the present Act. As to the means of conveyance if my hon. and gallant Friend will turn to paragraph 7 (1) (b) of the Order, he will see that a provision is included for the renewal or replacement of the Governor's official aircraft. We inserted that provision in the Order because we believe that the use of aircraft saves a great deal of money to the Indian taxpayer. It is a cheaper form of conveyance than the large railway saloons which have been used in the past, and the late Viceroy set an admirable example himself by travelling so much by aeroplane, thus saving the taxpayer the cost of policing the route, accelerating progress, and being a great deal less expensive.

Captain CAZALET:

I understood my hon. Friend to say that the Governor-General is covered by the recent Government of India Act, but he certainly did not have these privileges a year or two ago. Do I understand that he has been covered in a special Schedule to the Act, so that it is not necessary to include him in these Orders?

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I understand that the position will have to be regularised, and I am glad that my bon. and gallant Friend has given me the opportunity of making this clear, by a separate Order at a later date, but he will not be included in this Order, which deals solely with the Governors. I hope that, with these explanations, the House will agree to adjourn the Debate on the Order.

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

Motion made, and Question proposed, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 157 of the Government of Burma Act, 1935, praying that the Government of Burma (Governor's Salary, Allowances and Privileges) Order, 1936, be made in the form of the draft laid before Parliament.

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

8.50 p.m.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I beg to move, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 309 of the Government of India Act, 1935, praying that the Government of India (Audit and Accounts) Order, 1936, be made in the form of the draft laid before Parliament. I think it will be for the convenience of hon. Members if, with this Order, we consider the similar Order relating to Burma. The Government of India Act, 1935, made provision for the appointment of an Auditor-General of India and an Auditor of Indian Home Accounts, but left the definition of their powers and functions, together with the conditions of service of the Auditor-General of India, to be prescribed by the Order-in-Council which is now before us. Paragraphs 3 to 10 lay down the conditions of service of the Auditor-General of India. Those conditions are closely modelled on the rules which govern the office of the Auditor-General in India in present circumstances. Following upon these paragraphs, the draft Order deals with the powers and duties of the Auditor-General in India. His functions are, first of all, that lie is the principal keeper of Government accounts, his duties under this head being laid down in paragraphs 11 and 12; and the second and perhaps more important aspect of his functions is provided for in paragraph 13. The whole of this part of the Order may be said to include provisions designed simply to continue the existing well-tried system of audit and accounts in India, and, so far as they are appropriate, the existing statutory rules governing audit and accounts in India are taken as the basis.

In paragraphs 20 and 21, provision is made for the conduct in the United Kingdom of audit by the Auditor of Indian Home Accounts. This is the auditor who resides at the India Office and audits the Indian Home Accounts. As regards the scope of his duties, the existing position is maintained, the only modification of importance arising from the fact that, while at present the Auditor of Indian Home Accounts is independent of the Auditor-General, he will in future be under the general superintendence of the latter. Hon. Members who are interested in, for instance, the Public Accounts Committee of this House, and in the keeping of accounts and the problem of audit, will see that it is provided in paragraph 13 that the Auditor-General shall report on the expenditure, transactions or accounts so audited by him. In India there is a, body similar to the Public Accounts Committee, and it is to that body that the Auditor-General of India will report.

The Auditor of Home Accounts, as the hon. Member for East Edinburgh (Mr. Pethick-Lawrence) will appreciate, will not be able to attend in person before the Indian Accounts Committee, and that is why it is provided that he shall be under the general superintendence of the Auditor-General in India, although he will in fact audit separately the Indian Home Accounts at home. It is important that there should be some link between him and the Auditor-General in India. This arrangement continues almost exactly the existing process, but it ties up the Auditor of Indian Home Accounts to the Auditor-General in India. Besides his duties in regard to auditing, which are not restricted in any important degree, the Auditor-General in Indian is asked, as I pointed out in my initial remarks, to produce a general financial statement, which is referred to in the paragraph previous to the one I have just quoted. That financial statement is based upon his accounting function, and in it he gives a general statement of the accounts, as well as reporting later as Auditor-General upon the accounts which have been audited. I think I have described the main provisions of the Order; if there are any more detailed points, I shall be glad to do my best to answer them.

8.54 p.m.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

I have been much interested in the description given by the Under-Secretary of the duties of the Auditor-General, because it has to some extent cleared up one of the difficulties that I had with regard to this matter. But, although the hon. Gentleman has cleared it up in his statement, I do not quite see where the Order deals with the point to which I am going to make special reference. Before coming to that, I should like to ask a preliminary question. In the first Order that we took, the Federal Court Order, we were arranging for the appointment of wholly new officials. In this case we are also dealing with the appointment of an officer whose functions are largely defined in the India Act. I understand from the Under-Secretary that there is an Auditor-General under the existing Constitution, and therefore I gather that what will in effect take place is that the existing Auditor-General will have somewhat wider powers. Perhaps I may be told whether that is a correct deduction from what the Under-Secretary said earlier on. Are we to have an additional officer or are we merely going to take the two officials, the Auditor-General and the home auditor here, and give them somewhat different powers from what they have at present?

The point in which I was specially interested was the question of how far the Auditor-General was going to report to the Legislative Assembly. Of course, the essential characteristic of the Auditor and Comptroller-General of this country is that he is not a Government official but a House of Commons official who makes his report to the House of Commons and justifies, of otherwise, the financial acts of the Government and relates them to the provision that the House of Commons has made. When I read this Order, before I heard the Under-Secretary's explanation, I was under the impression that the Auditor-General would not have any intimate relations with the Legislative Assembly, and that his report would be made to the Governor-General. If I understand the Under-Secretary aright the audit and the report are to be made to the body that he said corresponded with the Public Accounts Committee of this country. If that is, in fact, the intention of the Order, why is it not stated so? Because it makes a very great deal of difference to whom the report is rendered. All the other sections of the Order suggest that the person who is to receive the report is the Governor-General, and I was under the impression that he was the only person who was to receive it, except that Clause 15 says: It shall be the duty of the Auditor-General to give the Federal Government and the Government of every Province such information as they may from time to time require. Now I understand that, in addition to the duty of auditing and reporting to the Governor-General and assisting the Governors, the Auditor-General will have certain duties to the elected representatives, at any rate of the Federal Assembly. I shall be glad to know whether the interpretation that I am now putting on it is, in fact, correct.

8.58 p.m.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I quite understand the hon. Gentleman's interest in the matter. For a short time I was a member of the Public Accounts Committee. Had I been there longer, I suppose I should have learned more about accounts. It is one of the most important Committees of the House. The Order says: The Auditor-General shall in each case report on the expenditure, transactions or accounts so audited by him. I understand the hon. Gentleman's difficulty to be that in the Order it is not laid down specifically to whom the report shall be made. Section 169 of the Act says: The reports of the Auditor-General of India relating to the accounts of the Federation shall be submitted to the Governor-General, who shall cause them to be laid before the Federal Legislature, and the reports of the Auditor-General of India or of the Auditor-General of the Province, as the case may be, relating to the accounts of a Province shall be submitted to the Governor of the Province, who shall cause them to be laid before the Provincial Legislature. The difference between this country and India is that the Auditor-General in India is appointed, as Section 166 says, by His Majesty and that he shall report to the Governor-General in the case of the Federation and to the Governor in the case of a Province. In each case the Governor-General and the Governor shall lay the reports before the Federal and Provincial Legislatures. It is at that stage that the reports get laid before a committee equivalent to our Public Accounts Committee. Here at home the Auditor-General is the servant of this House and reports direct to the House, whereas in India the circumstances are governed by Sections 169 and 166 of the Act itself. I hope that clears up the point.

9.1 p.m.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

I understand the Under-Secretary to tell us that this is only continuing the procedure that exists at present and that the Auditor-General reports to what corresponds to the Public Accounts Committee in India. There is a good deal of difference, and not merely a technical difference, between the Governor laying it before the Committee of the House and reporting to the House.

Photo of Mr Robert Bourne Mr Robert Bourne , Oxford

I must remind the hon. Gentleman that we are not in Committee. I thought he wanted to ask a question.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

I am sorry if I was doing more than that. I was only endeavouring to ask a question to explain the grounds on which I was putting the point. It may be that the Auditor-General in India is too busy a man to sit with that body, but are we to understand that either he or some deputy will be there to be cross-examined or interrogated by the responsible committee? That would give the committee very much greater power. Can the Under-Secretary assure us that that is the intention?

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

That is, in fact, the intention that the committee shall have the privilege of seeing the Auditor-General in person, and he will collaborate with them in the fullest sense of the word.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

Can you not put that in the Order?

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I understand the Auditor-General has in the past been accustomed to attend the meetings of this committee, and I think the hon. Gentleman may take it that the position that he desires is fully secured, and that will continue in future.

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

Motion made, and Question proposed, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 157 of the Government of Burma Act, 1935, praying that the Government of Burma (Audit and Accounts) Order, 1936, be made in the form of the draft laid before Parliament, subject, however, to the following Amendment:In the third recital, page 1, line 26, leave out '1937,' and insert '1936.'"[Mr. Butler.]

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

9.5 p.m.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I beg to move, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 309 of the Government of India Act, 1935, praying that the Government of India (Commencement and Transitory Provisions) (No. 2) Order, 1936, be made in the form of the draft laid before Parliament. I suggest that this particular Order should be taken with the other five Orders following, which are of a minor character, and that I should endeavour to give a general explanation of all of them, which, I understand, will meet the convenience of hon. Gentlemen. This particular Order provides for a very small matter. Provision for the appointment by the Secretary of State of the Government director and his deputy is contained in the case of most Indian railway companies in the contracts. Under Section 199 of the Government of India Act, 1935, the powers of appointment pass in effect to the Central Government. But the appointments of Government director in one case, with his deputy in more than one case are governed not by the contracts but by Acts of Parliament. The most convenient way of adapting those Acts to the new constitutional position is to bring Section 199 of the Government of India Act into force on 1st April next. The reference in that section to the consultation with the Federal Railway Authority must, of course, be held in abeyance until the establishment of the Authority. That is the explanation of paragraph 3 of the Commencement and Transitory Provisions Order.

Paragraph 4 relates to the Budget statement of expenditure for the year 1937–38. This has to be placed before the Legislature in the usual way some time before 1st April next. As matters stand, the form of Budget and the question of votability would be governed by the old Government of India Act, 1919. This is obviously very inconvenient. The expenditure for which this Budget provides will have to be administered and accounted for under the transitional constitution when, for example, such new features as the Crown Department, which administers affairs for the States, and functions vested in the Governor-General in his discretion will have come into being. So the object of this is simply to adapt the terminology of the Budget statement to the new constitutional position in the interim period. Therefore, these two particular points in this small Order are in the nature of adaptations from the old system to the new.

With regard to the Defence Appointments Order, in the past the defence appointments have not been made in quite the uniform way that is suggested under this particular Order. Appointments to certain high military posts are at present reserved to be made by the Secretary of State for India, and in one or two cases by the Secretary of State for War. Under this particular Order—the Defence Appointments Order—it is simply stated that all these appointments shall be made by His Majesty. No doubt hon. Members will wish to know what sort of officers are to be appointed in this manner and how important they are. There is, first of all, the Royal Indian Navy—the Flag Officer Commanding. In the case of the Army, General Officers Commanding-in-Chief in the four Commands, North, South, East and West; Chief of the General Staff, Adjutant-General, Quartermaster-General, Master-General of the Ordnance, and the officers commanding the various districts. They number about a dozen. That is the extent of the Orders which are in future to be centralised and made by His Majesty under the provisions of the Government of India Act. In the case of Burma, the General Officer Commanding in Burma shall be appointed by His Majesty. I would remind the House that in future Burma, being separated, will have an independent command. Hitherto it has been a quasi-district, but in future it will be a command of its own, the Governor himself being in control of the defence forces of Burma.

In the case of the next Order—the Federal Legislature Amendment Order—we are faced with one of those rare occasions in the Government of India Act where a little matter was overlooked. In this case it was overlooked that the State of Khaniadhana, which was previously included in the Central Indian Agency, was on 1st January, 1935, included in the political charge of the Resident at Gwalior. This State was omitted, and it was regarded as important to take this opportunity of making a small amendment in the list of States sending representatives either themselves or by deputy to the Indian Legislature by correcting the list and including the State of Khaniadhana.

The next Order relates to the Provincial Legislatures and includes certain miscellaneous provisions. The first provision it includes is to enable the present Advisers in the Provinces of Sind and Orissa who have salaried posts to stand for election in the coming elections in certain Provinces in India, otherwise they would, owing to holding these posts, be unable to take part in the elections and the political life of the Provinces. This was not intended, and this correction is important in that it will enable distinguished persons assisting the Government in the transitory period to take part in provincial elections.

The fourth paragraph has to do with the Corrupt Practices Order. The Government of India have reported to us that it is becoming an increasingly common practice on the part of the Commissioners to pass an Order in terms which sometimes mean that the man who loses his case in an election petition is charged with the whole cost of the Government in making the inquiry. The result has been that there has been a tendency for people not to bring their cases before these commissioners and the object of the Corrupt Practices Order has not been fully carried out. Therefore, we are making this small Amendment in order to enable the proper spirit to prevail in these corrupt practice appeals. In the case of Burma there is a similar provision for amendment of the Corrupt Practices Order, which I moved in the last Session and for an amendment of another small detail in paragraph (3) of the Burma Order regarding the qualification of a senator contained in paragraph (6) of the Burma Elections Order. This is purely a technical Order and a small mistake which we want to correct before the new Constitution. I hope, therefore, that these small explanations of these particular Orders and their contents will enable hon. Members to realise that in the case of these particular Orders which we are taking en bloc the questions are mostly ones of detail and of technicalities. I hope that I have covered all the points in them, and that hon. Members will be able to come to a decision on these questions.

9.14 p.m.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

The first of these Orders seems to be a matter of machinery only, and I do not intend to ask for any further information. The next Order relating to Defence Appointments, as I understand the effect of the Order, is to reserve about 20 appointments in all to His Majesty to make. What I take to be the result of that course is that the appointments will be made by His Majesty acting on the advice of his Ministers in the Government of this country. Therefore, it would take the appointment of these officers out of the hands of anyone in India. I should like an explanation of the effect of the Section of the Act under which this Order is made. I refer to Section 233 (2) which says: Nothing in this Section derogates from any power vested in His Majesty by virtue of any Act or by virtue of his Royal prerogative. Here are some 20 appointments which are reserved to His Majesty. Am I to understand from the Sub-section which I have quoted that at any time the Government of this country can go to His Majesty and add to the list of official appointments which will be reserved to His Majesty acting on the advice of the Government of this country? If so, that seems to me to be a position which the people of India may very well resent. It is from their point of view already a serious thing that 20 leading appointments in the defence forces of their country are to be settled entirely over their heads, but if there is no finality in the matter and other appointments can be placed in the same category, it seems to me that that would create a position to which they might rightly take considerable exception.

I should like further to ask whether the number of these appointments can at any time be reduced, and if so, on whose instruction would that be the case? I imagine that the answer will be similar to the one I received on a similar Order, namely, that there would have to be a further Order modifying the existing Order and that it would have to be passed by both Houses of Parliament and receive the assent of the King. I do not think it is necessary to say anything about the Burma defence arrangements, because they follow on the same lines, but in that case there is only one appointment. Little need be said in regard to the Federal Legislature Amendment. In regard to Burma, I am at a loss to understand the position under the Government of Burma (Miscellaneous Provisions) Order. Section 3 is a paragraph which refers to Income Tax. I have tried to understand it without very much effect. Perhaps the hon. Member will give me an explanation on that point.

9.19 p.m.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I gather that the hon. Member's difficulty, if I may answer him by permission of the House, is chiefly in regard to the Defence Appointments Order. My answer in general is, that the whole of defence in India is a reserved subject. Therefore, there can be no particular disappointment that certain high defence appointments should in themselves be reserved, when the whole subject of defence is reserved. The hon Member asks whether the number can be reduced, and, if so, by whom. He also asks what powers have we to add to the number of appointments. The power of amendment of this particular Order lies with the House of Commons and Parliament and, therefore, lies in the hands of hon. Members themselves. The Order can only be amended by an amending Order. In reality, although this Order looks very important it only regularises, according to the Section in the Act to which the hon. Member referred, the present position. As I tried to make clear in my original remarks, instead of these Orders being made some by the Secretary of State for India and in other cases by the Secretary of State for War, the whole matter is centralised and these arrangements are said to be made by His Majesty. Therefore, the answer to the hon. Member is that defence is reserved, that there can be nothing very remarkable in these high appointments themselves being specified in the Order, and that the Order would have to be amended by the Imperial Parliament whether to the extent that the appointments be added to or that they be subtracted from.

Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Edinburgh East

Suppose there was no such Order, by whom would these appointments be made? I take it that they would be made by the Government of India or the Governor-General. The hon. Member says that no exception can be taken to these Orders, but there is a feeling in India which is expressed in the phrase that it is not government in Delhi but government in Whitehall.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

It was the object of the Government of India Act and was laid down clearly that there would be reserved to His Majesty certain high defence appointments. Those appointments can only be added to or subtracted from by another Order.

The hon. Member asks for the meaning of sub-paragraph 12 (1) (i) of the Third Schedule of the Burma Act. If he turns to the Burma Act he will see that that particular sub-paragraph reads: was, in the financial year preceding that in which the election is held, assessed to income-tax in Burma on an income of twelve thousand rupees a year or over. We find that there was a misstatement regard the income tax qualification required by a senator, contained in paragraph 6 of the Burma Senate Election Order, which I explained last Session, with all its complications. To-day, in order to regularise the position we have been obliged to move an Amendment to insert the words: having in that year a total income of not less than 12,000 rupees. Our object has been to correct the mistake in paragraph 6 of the Burma Senate Election Order and there is nothing deep or sinister in our doing that.

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

Motion made, and Question proposed, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 309 of the Government of India Act, 1935, praying that the Government of India (Defence Appointments) Order, 1936, be made in the form of the draft laid before Parliament."—[Mr. Butler.]

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

Motion made, and Question proposed, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 157 of the Government of Burma Act, 1935, praying that the Government of Burma (Defence Appointments) Order, 1936, be made in the form of the draft laid before Parliament."—[Mr. Butler.]

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

Motion made, and Question proposed, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 309 of the Government of India Act, 1935, praying that the Government of India (Federal Legislature Amendment) Order, 1936, be made in the form of the draft laid before Parliament."—[Mr. Butler.]

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

Motion made, and Question proposed, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 309 of the Government of India Act, 1935, praying that the Government of India (Provincial Legislatures) (Miscellaneous Provisions) Order, 1938, be made in the form of the draft laid before Parliament."—[Mr. Butler.]

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

Motion made, and Question proposed, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 157 of the Government of Burma Act, 1935, praying that the Government of Burma (Legislature) (Miscellaneous Provisions) Order, 1936, be made in the form of the draft laid before Parliament."—[Mr. Butler.]

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I beg to move, That an humble Address be presented to His Majesty, in pursuance of the provisions of Section 309 of the Government of India Act, 1935, praying that the Government of India (Family Pension Funds) Order, 1936, be made in the form of the draft laid before Parliament on 3rd November, 1936. This matter of Family Pension Funds is one of considerable importance, in that it deals with the dependants of certain Indian pensioners, subscribers to the funds, set out in paragraph 7 of the Order before us. It is one of some lengthy history, as it is natural that pensioners should be interested in the future of these funds on which their dependants will depend. It was considered in detail by the Joint Select Committee and, to put it shortly, there was an original scheme proposed, largely at the instance of subscribers and for which they had been pressing for some years, that the funds should be vested in commissioners at home, and that the balance in the name of subscribers in India should be transferred home as soon as possible. The idea is that these funds should gradually go back. In a note to the Joint Select Committee the then Secretary of State suggested a period of 12 years. This period was shortened at the instance of the subscribers to three years, and this was the figure finally included in the Government of India Act.

This Order was laid on 21st April, and we had intended to ask Parliament to approve it in July last, but at the request of subscribers, and in order that they should not be rushed in this important matter, we extended the period for three months. The Order has in this period undergone some not unimportant amendments, and subscribers have been given the opportunity to consider the issues before them. We have distributed much information from the India Office in the circulars to subscribers, and I should like to pay tribute to the manner in which the associations representing the subscribers have done their best to bring their views on this matter before the subscribers. I say this to show that every opportunity has been taken to enable subscribers to decide on a matter of importance to them. It is only when the Order is passed that the subscribers have to make their choice whether the funds are brought home or not. If they say nothing the funds are brought home, but the Order contains provision for objections to be made, in paragraph 18 and the following paragraphs.

If objections to transfer are made the funds belonging to subscribers who do not wish to transfer will be left as at present with the Government of India. The period of choice is up to 31st March, 1937, and by that time they will have had the information before them almost a year. The choice in this matter must be that of the subscribers. It is not a choice for the Government to make or which hon. Members can make. Hon. Members can assist the Government in criticising the terms of this Order, but the choice is one that must be made by the subscribers, and any steps taken by the Government have been conscientiously taken to enable subscribers to make up their minds and to achieve the results they desire. The Government have taken steps to inform them by circular, in May, 1933, when some preliminary figures were given of the amount likely to be drawn if the funds were transferred, and in April, 1936, when a further circular was issued giving some detailed figures of the likely reduction involved due to the different rates of interest here and in India. The total amount in question is about £12,000,000. Certain steps were also taken by the associations to which I have referred who also issued a statement on these funds, and I can only say that if this statement was somewhat more optimistic than that of the Government, so much the better for the pensioner if their optimism was justified.

The Order sets out in the first part the nature of the fund, that is paragraphs 2 and 3; paragraphs 4 to 9 set out the duties and constitution of the body of Commissioners; paragraphs 10 to 13 relate to the vesting of the funds in the Commissioners, and paragraph 12 sets out the stocks in which the Commissioners shall invest the funds when they are brought home; paragraphs 14 to 17 deal with the functions of the Secretary of State, who will continue to have a large part in the administration of the funds; and paragraphs 18 to 21 deal with the objections to transfer. I would refer in conclusion to the importance of the Order, in that there is a large body of dependants of men in the Army and Civil Service who have rendered great serive to India and whose interests it is the wish of the Government to preserve. We have included in the Government of India Act a provision that the fund should be brought home and it is now for Parliament to decide on the terms of this Order, which we believe to contain the best possible terms in the circumstances. If the Order is passed the subscribers must decide whether they object to the transfer or whether the fund in question shall be brought back and invested in the Commissioners in this country.

9.36 p.m.

Photo of Sir Reginald Craddock Sir Reginald Craddock , Combined English Universities

I beg to move, in line 5, at the end, to add the words: subject, however, to the following Amendment:In paragraph 17, on page 5, lines 28 to 30, leave out 'from time to time make such alterations in any pension payable out of the said funds as may in his opinion be reasonably necessary in consequence of the transfers,' and insert having obtained from an actuary a report on any of the funds, make such alterations in any pensions payable out of that fund as may appear to him after consideration of the report to be reasonably necesary in consequence of the transfer of that fund.' Before I come to the terms of my Amendment I should like to make a few general remarks about the Family Pension Funds. The Under-Secretary of State told us that a Draft Order was laid on the Table of the House some months ago but on the application of the pensioners themselves it was postponed. We now have this new Order before us. I should like to indicate that the Pensioners Associations, those with which I am connected are grateful to the India Office, and particularly to the Under-Secretary of State for the patience with which has has considered their requests and has embodied in the present Order several of the suggestions for improvement which were made by the associations. As the House has been informed there are several Funds concerned, and in some cases the funds do not exist except in the form of an obligation on the part of the Government of India the administration of the funds having always been maintained at the India Office. The question of their transfer from India was warmly advocated by witnesses who came before the Joint Select Committee on behalf of the association, and it was with great gratification that most of us at that time learnt that the then Secretary of State was able to promise to bring home these funds at a much earlier date than was at first thought possible. That was received at the time with great satisfaction because the attitude of the Pensioners' Associations has been that if tic British Government could not guarantee the payment of these pensions they might be brought home and invested in gilt-edged securities and other similar stock under the care of Commissioners, who would deal with the investments, while the administrative part of the work connected with these funds would continue to be performed by the Secretary of State.

I am aware that there has been a change of opinion on the part of some of the pensioners who have been alarmed by the fact that the actuarial report indicated a larger reduction in the pensions brought home than they had previously anticipated. Personally I do not share the opinion that a reduction in the pension should override the importance of getting these funds transferred into sterling and held under the charge of Commissioners. Whether the Government of India will be able to perform its obligations will depend on what will actually be the future of India so many years ahead that there is not one of us in England or in India who can prophesy with any certainty what is likely to happen at so distant a date as that at which the last claim on this fund will have to be met. When asked for advice by dependants on the fund I have always given the advice that unless the pensioner is of an advanced age and is so dependent on the pension that even a small reduction will cause penury, in those cases where it is not expected that the pensioner will survive for many years, it may be to their advantage to leave the money under the present conditions. The hon. and gallant Member for New Forest (Major Mills) will explain the case of pensioners and subscribers who wish to have the funds left in India for the present but with a second choice a few years hence to enable them to transfer if they so wish. I am glad that their views should be represented to this House.

Now I will turn to the Amendment which refers to the power of the Secretary of State to make such alterations in any pension as may in his opinion be necessary in consequence of the transfers effected under this Order. I am not one of those who imagines that the Secretary of State is going to act in an inconsiderate way but at the same time we must have in a document of this kind more precise language and I hope the Under-Secretary will be able to accept the Amendment and put in a condition that any reduction of the pension must be made in accordance with the report of an actuary and cannot be made by the Secretary of State for any such reason that it would be a good thing to reduce pensions. I hope also that the Under-Secretary will give an assurance that the practice which has been in force for the last 15 years will be continued. That practice is simply this. The then Secretary of State, Lord Peel, consented to a request by the Indian Civil Service Retired Association that an actuary suggested by themselves should co-operate with the Government actuaries at the time of the quinquennial revision and give his comments and opinion, which was a satisfaction to the pensioners that there were two opinions on the actuarial position. In that way they would be reassured as to the state of the Fund. I hope the Under-Secretary will be able to see his way to give a promise in this connection, even if it is not a thing which can be conveniently put in the Order.

9.46 p.m.

Major MILLS:

I beg to second the Amendment.

I do not propose to take up the time of the House by adding to the arguments which my hon. Friend adduced, though it will obviously be a relief to the Secretary of State to act on the Actuary's report, but I would like to take this opportunity of making a few remarks on another aspect of these family pensions and to raise a point and ask a question on Clause 18, which immediately follows the one to which this Amendment has been moved. The point I wish to raise on Clause 18 I will explain as briefly as I can. On 9th April, 1935, when the House was in Committee on the family pensions Clause, I suggested to the then Secretary of State that pensioners and beneficiaries who decided to leave their money in India should be given a second chance of bringing it home at a. later date if they so desired. The Secretary of State did not, in his answer, say that it was technically impossible to do that because of anything contained in the Bill itself, but he said: I am afraid that they must make the decision now. It would naturally be very difficult to carry through the proceedings if we did not know—I do not say in a few days or weeks—what is the sum to be left in India and what is the sum to be funded here. The option therefore must be once and for all."—[OFFICIAL REPORT, 9th April, 1935; col. 899, Vol. 300.] I would like to underline the word "therefore," which shows that obviously he had in mind the financial and actuarial difficulties. I had hoped to be able to move an Amendment to this Clause with the object of giving the people who left their money in India a second option of transferring it home in five years' time, but on consulting my hon. Friend he told me that for certain reasons it would not be in order to do so, and that the only thing that would be in order would be to substitute, in the first line of the Clause, the year 1942 for the year 1937. That, of course, would mean a simple delay and would not be in accordance with my views, nor, I imagine, with those of anybody else. I come now to the question I want to ask my hon. Friend. The Order will be passed—I hope with this Amendment embodied in it—money will be brought home and money will be left in India, and the transfer will be completed. Is there any reason why the Secretary of State should not, of his own accord, at some later date—say in five years' time—put forward another Order in Council giving another chance to the people who leave their money in India now to bring it back to Great Britain?

In the alternative, if that is not possible, could not the Secretary of State make a rule or regulation having the same object? Let me explain what I mean by the alternative. As I understand it, when the Fund has been set up it will be regulated by a rule made by the Secretary of State under the authority of Parliament. Could not the Secretary of State, when this original transfer has been completed, at some later date, make a rule allowing other similar subscribers to transfer their accumulations from India to the Fund in Great Britain, particularly if it were found that it would be to the advantage of both sides? Is there anything in the main Act which would prevent it? I do not believe that the financial and actuarial difficulties are as great as appeared to the Secretary of State in April, 1935, and I am sure they are not insurmountable. At that time they were his reasons for refusing the suggestion.

The reason I am so insistent in inquiring what, if anything, can be done in the matter is that it involves the fortunes of a very large number of people who deserve the best that their country can give them. There are at least 10,000 of these pensioners and beneficiaries. They are faced with a substantial loss of income if they bring their money home, and they find it extremely difficult to make up their minds what to do when the Government of India is in its present transitional state. I would like to know what the Secretary of State has decided to do about the subscriptions of new entrants, for it is his responsibility to look after them. Is he going to have those subscriptions invested in India or in Great Britain? That is a matter on which I would like enlightenment, which would also be of great interest to the pensioners.

At Question Time to-day I asked my hon. Friend whether any representations have been received from associations representing civil servants or military officers, either active or retired, asking to be allowed at a later date to have a second option to transfer their share in the Family Pensions Funds from India to England? I received the following written answer: The answer is in the affirmative, but my Noble Friend is advised that the provision for a second option would be ultra vires to the Government of India Act, 1935. That answer bears out my information that representations have been made by at least four important associations of pensioners and by other people through appropriate channels. I think that the India Office should give the most sympathetic attention to the widely-expressed wishes of so many of these good servants of our country. After all, it is out of their own savings that these pensions are being paid. What is more, it would be a great help in getting the right type of young man to continue to go out to India if he felt that he had the sympathetic and helpful India Office behind him. I am certain that nothing divides us in principle on this matter. We are all sympathetic in that we wish to do the best we can for these pensioners. I do not wish to ask my hon. Friend for any promise for a second option, because I know he cannot give it; but I ask him to consider whether, with all the skill, the knowledge and the sympathy that there is in the India Office, some way cannot be found—either such as I have suggested or otherwise—by which the Secretary of State could, if he chose, at some later date after the original transfer has been carried out, give the people who do not transfer now a second chance, particularly if at that time a widespread demand for it is brought to his attention.

9.55 p.m.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I am very glad to be able to say that I can accept this Amendment on behalf of the Government. We think it will be valuable for the Secretary of State to be aided by the continuance of the system as it will be under this Amendment. My hon. Friend the Member for the English Universities (Sir R. Craddock) asked whether the services could rely upon the continuance of the present system, which I shall describe, in the terms of a communication from a previous Secretary of State to the representatives of the service associations. The Secretary of State of that date—1923—said that he would offer to any properly qualified actuary nominated by the Indian Civil Service retired association an opportunity of conducting an independent investigation of the position of the Indian Civil Service Pension Scheme. His Lordship wished it to be understood that his compliance on that occasion with the wish expressed to him to obtain further actuarial information did not imply any intention to divest himself in any degree of the absolute control and management of the scheme then vested in him. I am authorised to say that that arrangement may, from the point of view of the Secretary of State, certainly continue. If that will give any assurance or satisfaction to the members of the service associations, I hope they will accept my remarks in the spirit in which I make them.

The only caveat I would enter is this. As far as I have been able to investigate, in the short time available, the legal position in regard to the cost of the actuary, there may be some change in the present position in that respect. Apart from that, it is certainly our intention that the spirit of the old agreement under which this particular actuary works shall continue. My hon. and gallant Friend the Member for the New Forest (Major Mills) asked whether it would be possible for those who may decide of their own free will to leave the money in India, to have an opportunity of joining the fund in the future. My difficulty in this respect was expressed in my answer to his question to-day. Such a proposal would be ultra vires the Government of India Act which says that subject to the provisions of subsection (3) of Section 273 these funds shall be transferred to the Commissioners before the expiration of three years from the said date, either all at one time or by instalments together with such interest as may be prescribed by or under the Order. Therefore, it would be impossible to achieve the result which my hon. and gallant Friend desires by Order in Council. He referred to the possibility of dealing with other matters by Order in Council, but in this case an amendment of the Act would be necessary and I am authorised to say that it is not the intention of the Government to amend the Act in this respect. The Government has, as it believes, responded to the request from hon. Members and from subscribers to frame a plan for the transference of these funds or otherwise at the choice of the subscribers. The Government in the Debates in the House of Commons while expressing their confidence in the future credit of India, produced this plan in the manner and for the reasons described and their intention is that the choice shall be made either for or against this plan. I sympathise with what my hon. and gallant Friend said as to there being many who, through anxiety or nervousness, would like to defer a decision on this matter but I can assure him also that a vast body of subscribers wish to make a decision here and now and feel that further uncertainty may make it impossible to create a fund. That is why the Government is not able to amend the Act in the way desired.

My hon. and gallant Friend asked a further question about new entrants. No public announcement has yet been made by us on this point. In fact we have not yet reached a decision. We shall leave that question until the condition of the fund, as between those who wish to leave the money in India and those who wish to transfer it has been made clear. When we have a clear idea about those who decide in the one way and those who decide in the other, we shall then make a decision about new entrants. I am sorry that I have not been able to go all the way towards meeting the views of the hon. Members who have spoken but I am glad to be able to accept the Amendment and I hope that the subscribers will find it possible, in the months remaining before the end of March to come to a conclusion upon this important matter. It has been throughout the wish of the Government to provide facilities, for those who are not desirous to leave their funds in India, to bring them home, if such be their desire.

Amendment agreed to.

Main Question, as amended, proposed.

Ordered, "That the Debate be now adjourned."—[Mr. Butler.]

Debate to be resumed upon Monday next.