Clause 2. — (Rate of oats subsidy payments).

Orders of the Day — Agricultural Development Bill. – in the House of Commons on 18th July 1939.

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Photo of Mr Thomas Williams Mr Thomas Williams , Don Valley

Do I understand, Mr. Speaker, that you are calling the Amendment on Clause 2, page 2, line 37?

Photo of Mr Thomas Williams Mr Thomas Williams , Don Valley

I take it from that that you are not calling the previous two Amendments on Clause I which refer to a committee to deal with the standard price?

Photo of Lieut-General Edward Fitzroy Lieut-General Edward Fitzroy , Daventry

No, I am not calling the previous two Amendments.

7.59 p.m.

Photo of Mr Thomas Williams Mr Thomas Williams , Don Valley

I am sorry. We regard those Amendments as fundamental.

I beg to move, in page 2, line 37, to leave out "fourteen," and to insert "twelve."

The fact that the other two Amendments arc not being called increases enormously the importance of this Amendment. Its purpose is, briefly, to reduce from 14 to 12 the number of times the difference which the higher rate shall be between the market price and the standard price for oats. The right hon. Gentleman can vary the standard price as often as he likes or when he thinks it necessary that there should be some limitation upon the number of times the price can be multiplied. In this Clause, when the average market price of oats falls below 8s. per cwt., the Minister may provide in terms of subsidy 14 times the difference between 8s. and the actual price. That is for the person who has not received during that cereal year a deficiency payment for wheat. It has been said on many occasions that the National Government never know where they stand for two minutes together, and that is absolutely true. We have seen over a period of years that Scottish Minister of Agriculture after Scottish Minister has been brought in and, when one has given as much as he can, he has departed and another Scottish Minister has taken his place and given as much as he can in subsidies, and away he has gone. Finally, we have settled on a Minister who is not a Scotsman. The Act of 1937 guarantees the grower of oats who did not receive a wheat deficiency payment six times the difference between the market price and the standard price, and the new Minister has fixed on the figure of 14 times instead of six times.

On the Second Reading, and in Committee, we sought from the Minister and from the Secretary of State for Scotland some facts and figures on which they have based their multiple of 14 times. After all, this is a guaranteed price. It is not insurance. No premiums are paid. It is a subsidy and, as far as I know, up to the moment no one outside the Ministry knows on what this multiple of 14 times is based. We know, however, that during the cereal year 1938 the price of oats and barley fell to a very small figure. Threats were made in certain by-elections that something would happen unless the Government took a step forward. This is one of the steps forward that the Government took. They have told us nothing about the cost of production of oats or the variations, county by county, and perhaps field by field. All we know is this. When the Minister had to go to the Treasury to justify this subsidy he certainly had to make some submissions to the Treasury to get the £ 2,000,000 per annum. We are entitled to know exactly what those calculations were. There are certain parts of the country where to grow a cwt. of oats may cost 4s. 5s. or 6s. while in other areas it may cost 10s. 12s. or 14s. We know that what pays the man whom it costs 10s. or 12s. leaves the fellow on land where it costs only 4s., 5s. or 6s. a very considerable profit indeed.

For the last nine years the average price for oats has been round about 6s. 10d. per cwt. Under the terms of this Clause if oats were to fall to the unprecedentedly low level of 4s. 8d. per cwt. this guarantee provides not only the average for the past nine years, but it provides, approximately, 14 per cent. more than the average price for the last nine years. It may be that the Minister or the Under-Secretary for Scotland can justify it. The hon. Member for Thirsk and Malton (Mr. Turton), when he wanted to justify it, went back to the dark ages and produced an argument based on the figures of the dim and distant past. If my Amendment were carried, and the unprecedentedly low level of 4s. 8d. were the average price, we should still be guaranteeing the oatsproducer something more than the average for the past nine years. I do not think that is ungenerous. Oats is one of those peculiar crops where, in England or Wales, only 15 per cent, is sold off the farm, the remainder being consumed on the farm. There is no average price for that; in fact, there is no price at all. It is a curious situation that we are guaranteeing a price for a commodity which is never sold.

It is true that in Scotland a very different story can be told. There some 45 per cent, of the oats grown is a cash crop. In England and Wales we may have 2,000,000 odd acres under oats. The Minister ascertains that in this or that market the 15 per cent, surplus to the farm's requirements fetches a certain price. No control is exercised over the farmer. He sells it just how he likes to whom he likes, and he does not worry. He certainly need not worry in future, because he will know full well that, whatever the price may be on the ordinary market, the Treasury is going to make it up. The merchant knowing that it does not matter to the farmer whether he pays him 6s or 7s. per cwt., and knowing also that when he resells it is going to be some other farmer or poultry keeper, all kinds of collusion are possible. I am not arguing against a subsidy as such. It may be that the Minister can justify the subsidy in England and Wales, and it may be that the Under-Secretary can justify it in Scotland, because there is a subsidy for wheat growers in England, but I am not sure that on the basis of pure economics it is possible to justify this particular subsidy for oat growers even in Scotland. In any case, we are convinced that this multiple of 14 times is too generous. Control is too weak, and Parliament is being asked to do something for which we have had no solid justification In terms of mathematical calculation, and for which no real justification has been offered at all. On the Second Reading I put a question to the. Secretary of State for Scotland and I repeated it in Committee, but we got no real information. This is what I said: The average price for the past nine years has been 6s. rod. per cwt. The guaranteed price under the terms of the Bill is approximately 7s. 9d. per cwt. even if the price fell to 4s. 8d. per cwt. That is in cases where no wheat subsidy is claimed by that grower. In the lower cases, where wheat subsidy is also paid, the guaranteed price is approximately 6s. Id. Would the right hon. and gallant Gentleman ask his colleague, when he replies to-night, to give the House some information as to the calculations of the guaranteed 7s. 9d. per cwt. for oats? "— OFFICIAL REPORT, 15th June, 1939; col. 1595, Vol. 348.] The Secretary of State replied, but not one word did he utter concerning those calculations. We, therefore, ask the right hon. Gentleman to-day to give us the A.B.C. of their calculations and the real basis of this multiple of 14 times as against the six in the 1937 Act. If they will do that, it may change our attitude even towards this Amendment, but as long as my Amendment guarantees the oats producer a price in excess of the average price for the past nine years, I am willing, and I hope my hon. Friends will vote with me, to reduce this 14 to 12. The thing that I am after most, however, is for the Minister to tell us exactly what they told the Treasury when they went to get this subsidy, this political bribe for farmers in Norfolk and Scotland, this movement which is making the rural part of the country safe for the Conservative party.

8.14 p.m.

Photo of Mr John Morgan Mr John Morgan , Doncaster

I regard these proposals as the most vulnerable section of the Bill, not merely from our point of view, but from the ultimate point of view of farming, because it is quite clear that, unless we are able to justify up to the hilt the amounts being paid out to oats growers, we may find the whole thing swept away, as the Bill puts it, by the consent of the Treasury, because it cannot stand justifiably on an economic basis. There is some sort of marketing scheme in the Bill with regard to barley, but oats in this Bill are tied up with the payment to wheat. Wheat is protected to some extent by the Standard Price Committee and that will be an enormous buttress presently in support of the wheat side of farming when the critical time comes, but with regard to oats we are being generous to a crop which as my hon. Friend indicates, to the extent of 85 per cent, in England and Wales is consumed at home.

Whatever the reasons for fixing 14 as denoting the average quantity of oats produced per acre, it is less than the average, and presumably it is less than the average in order to make some allowance for cost of administration and for seeding uses of certain classes of oats and so on, but there is no allowance in this quota for the fact that oats are mainly consumed at home as a substitute for feeding stuffs that might otherwise be bought. There should have been some allowance, in something like the proportion of 12 as to 14 as contained in the Amendment, in order to put the justification for this assistance to oats on as firm a footing as possible to face public opinion presently, and to face the Exchequer and Treasury pressure a little later on. We are not moving this Amendment in a frivolous spirit or because we want to see that agriculture receives less than that to which it is entitled, but in order that the assistance may be on a sounder basis for justification in any kind of circumstances. It is very difficult, even discounting 14 as to 12, to justify, even before farmers, the paying of Is. above the average price for the last nine years in respect of a crop that is facing a contracting market all the time.

Here is a crop of which the farmers themselves are relinquishing the use. They are preferring tractors to horses, and tractors do not consume oats. The farmers themselves are doing that, and not any outside interests. Again, the farmers themselves are buying feeding-stuffs, such as compound cakes and milling offals, to feed cows and bullocks, instead of using home-grown oats. They have economic justification for that, but here is a crop on the use of which the farmers themselves are putting alimit, and yet we are deliberately exaggerating the financial assistance to this industry. It would be wiser on the part of the Minister to put his assistance to oats in particular on a footing which can be justifiably argued at any time or in anycircumstances, and not in the flush of the moment, when he may be anticipating an electoral appeal to interested areas. Surely the Minister has not missed the significance of the fact that even on this side Members are susceptible to constituency influence on a question of this kind.

The House as a whole is considering this matter, and, while Members may be in a difficulty in expressing their real mind about oats as a crop which should be assisted to the extent that barley or beef or milk or any such product is assisted, yet it is the fact that Members are at this moment disposed not to be unduly critical of the assistance that is being offered to their constituents. But the time may come when they may have to explain how it was that the Treasury took it just as easily away, because they had not established an economic justification for this assistance but have been over-generous with respect to a crop that cannot even sustain its own support in a market that is not affected by imports. It is affected by the farmers' own use of the crop, and therefore the Minister would be advised to realise that he may have to come back at some future time and remind Members, when he is under the pressures that will come upon him, that he did his best to put it on a footing which would enable it to stand in good times and in bad against pressures from one quarter or the other. As it is now he will lose the whole lot because he goes too far. Farmers themselves, if the assistance is over generous, will not only not buy oats, but will extend the cropping of them. If you give them more than they can economically cope with, they will begin to extend their acreage, and you will embarrass the position further. It will be impossible for the Minister to come to this House again for any more assistance for oat growers. He has reached the limit in this Measure, and he will be wise to hold his hand.

8.22 p.m.

Photo of Mr Colin Thornton-Kemsley Mr Colin Thornton-Kemsley , Kincardine and Western

Before my right hon. Friend replies I would like to say a few words from the point of view of the Scottish oat grower, who has been referred to by both hon. Members opposite. The hon. Member for Doncaster (Mr. J. Morgan) has asked whether there is any economic justification for this basing of the oat subsidy on 14 cwts. per acre? He knows as well as I do that the average yield of oats in the United Kingdom has been found to be 16 cwts. per acre. From that total, 2 cwts. per acre have been deducted in respect of seed and waste, which is a figure which has been found in practice to be the amount which is used for seed and which is waste. That is how I imagine the 14 cwts. per acre has been arrived at. Therefore, where you have an oat grower who is not taking the benefit of the wheat quota payment, he is in fact getting help upon practically the whole of his yield. Both the hon. Member for Doncaster and the hon. Member for Don Valley (Mr. T. Williams) made again the case which they have made so often and so ably upstairs in Committee, that we are guaranteeing to the farmers a figure in excess of the average yield for the last nine years. But supposing we had only guaranteed these farmers the average of the last nine years, what would have happened? What has been happening during the past nine years in Scotland? They know as well as I do that land which had been under the plough has been going down to grass and to rough grazing, that men were going out of employment, and that agriculture was declining.

The whole point of this assistance, which is so much welcomed in parts of England and Wales, and definitely welcomed in Scotland, is that it makes, or seeks to make, mixed farming profitable. From these Benches the need for cereal parity has often been urged. It has been pointed out time and time again that the Englishman in respect of his wheat has been receiving adequate assistance, based on a price of 10s. a cwt. We are not getting that for our oats. We are getting assistance based on 8s. per cwt. Therefore, we are not to that extent getting the cereal parity for which we have asked. We are getting some help which will enable the farmers of certain parts of Scotland to bring back land under cultivation, to keep the plough going and to go on with those systems of mixed farming which have made our agricultural counties great in the days gone by.

8.26 p.m.

Photo of Mr Richard Acland Mr Richard Acland , Barnstaple

I support the Amendment. The Government at one election after another promised that they were going to bring prosperity to the farmers by one means or another, but really nothing was done to help agriculture until there came the revolt, to which reference has been made. That revolt brought with it the prospect of the loss of seats for the Government, with the result that it achieved what promises had failed to achieve, in that it made money available for agriculture. We on these Benches voted for the principle, which I suppose 99 farmers out of every 100 rightly expressed in their own language, that something ought to be done for agriculture. I voted for this Amendment in Committee and I propose to repeat my vote to-night, if the question is taken to a Division, in spite of the fact that if the Amendment were carried it would reduce the amount of money made available to agriculture. I have already received a complaint in writing from my constituency for having voted, as it is said in the complaint, against oats. Therefore, I think I shall be justified in repeating the reasons why I gave that vote on the Committee stage, because I propose to stand my ground, in spite of criticism.

I do not think the Minister of Agriculture realises what an extraordinarily lucky individual he is. I mean that, because other Ministers have not been able to persuade the Chancellor of the Exchequer to do so much for agriculture from the Chancellor of the Exchequer's point of view. Ministers of Agriculture in the future may have the greatest difficulty in persuading Chancellors of the Exchequer to do even what is being done now. That being so, I cannot help thinking over and over again, as we deal with the successive stages of this Bill, what a tragedy it is at this moment, when money is forthcoming for agriculture, that the money is being spent in this particular way. It reminds me of a passage from the Bible, which I am afraid I shall only be able to quote inaccurately. However, I think it is a very well-known passage and most hon. Members will recognise it and recall the real beauty of the words, no matter how stumbling may be my paraphrase: The dove that cleaveth the air with her swift pinions, but when she has passed, the air closeth up again and no trace of her passing can be found. The passage goes on to refer to an arrow shot at a mark when the air closes after it has passed through, and nothing of its passing can afterwards be found. The money that is being spent is, of course, very much welcomed by those who will receive it, and one cannot but express approval of the fact that they will be receiving it; but it is regrettable that this money, found by the taxpayer, through the hands of the Chancellor of the Exchequer is to be spent in such a way. What trace of its passing will be found upon the whole surface of British agriculture in ten, five or even two years from now? None. We may perhaps find some trace in rents being a little higher or, at any rate, a little higher than they would otherwise have been. In other ways that one could think of this money could have been used constructively for the benefit of agriculture; these millions of pounds that the Minister has succeeded in extracting from the Exchequer. There surely must have been in the Ministry of Agriculture among the permanent officials better plans than these for spending this money on agriculture.

In the Committee stage I put down an Amendment for the spending of the money in another way. I suggested that the money might be spent in disindebting the industry. We all know how grievously the industry as a whole is burdened by debts to all kinds of people; debts carrying very high rates of interest, debts carrying interest called Is. per ton per month, which may work out at 20 per cent, a year. These debts not only carry a high rate of interest but they restrict the farmers in the sources from which they can purchase raw materials, so that even when other sources are available, such as co-operative methods among fanners — one would have thought that such methods would have received some encouragement in a Bill entitled the Agricultural Development Bill— the farmers cannot avail themselves of those cheaper sources of supply, burdened with debt as they are, because if they do so, even for a small purchase, they are faced with a demand for the payment of the whole of their debt, which they cannot meet. Money spent on paying off debts bearing a high rate of interest and taking them over at a lower rate, thereby freeing the farmer and enabling him to make his purchases where he can best do so, would have a great effect on the bank balance of the farmers, even in 1939. Not only that, but had my suggestion been carried out it would have left a permanent mark on the structure of agriculture as a whole. I shall support the Amendment for the reasons I have given, because I think the money could have been spent in so many other ways that would have been more permanently useful to the industry.

8.35 p.m.

Mr. Wedderburn:

The Amendment proposes to reduce the number of cwts. in respect of which the guaranteed price is given, from 14 per acre to 12 per acre. The hon. Member for Don Valley (Mr. T. Williams) has introduced the question of why the figure of 8s. for each cwt. has been chosen. I will try to answer both these questions. There was one point in his remarks which I did not quite understand. He said that whatever price the farmer may get for his oats the Exchequer will make up the difference between it and the standard price so that he need not bother to get the best price himself for his oats in the market. That is not really the case. He is paid on an acreage basis, on the difference between the average price for the whole country and the standard price, and he still has a great inducement to get the best price for his oats, for if he sells above the average price he will, of course, gain both ways. The hon. Member quoted from his Second Reading speech and he said that the question he had put had not been answered. He pointed out that the guaranteed price under the terms of the Bill was approximately 7s. 9d. per cwt., and he asked whether the right hon. Gentleman would give the House some information as to the calculation of the guaranteed price of 7s. 9d. per cwt. on oats.

I think there is a slight misunderstanding about the figure of 7s. 9d.; the figure is 8s. The margin of 3d. does not mean that he will only get a guarantee up to 7s. 9d.; it means that no payment is made unless the price is below 7s. 9d. If the price is 7s. 8d., then he will get 4d. in order to make it up to the 8s. The reason for choosing the figure of 8s., which was fixed in the 1937 Act, is the relationship, which experience has generally shown to be more or less preserved over long numbers of years, between the price of wheat and the price of oats. Under the Corn Production Act, 1921, the price of wheat was guaranteed at something between us. and 12s., when the price of oats was 2s. lower. Since that Act has been repealed the actual price of oats over a number of years has generally been about 2s. per cwt. below the price of wheat, and in fixing the figure of 8s. we had principally in mind the relationship between these two cereal crops.

The hon. Member asked why we had put the figure so high above the average price for the last nine years. That, of course, is a point which is frequently made when we are discussing this subject, but the fact is that the last nine years in particular, with one exception, have been years of depression. It was in 1930 that the slump took place, and since 1930 there has been only one year, 1937, in which a slight temporary recovery took place. But if we go back to the years before 1930, in 1924, which was not a year of greatly inflated prices, the price of oats was 10s. per cwt. in 1925, 9s. 8d. in 1926, 8s. 5d.; in 1927, 9s. ad.; in 1928, 9s. 6d.; and in the following year, 1929, 8s. 2d. In all of those years, if this Bill had been in operation, no subsidy payment would have fallen to be made at all. There is one other consideration which arises from our experience of the 1937 Act. From 1930 the oat aoreage had been declining, but after 1937, when the price naturally rose to over 8s., the acreage increased by 100,000, which seems to indicate that the price of 8s. is the price which will achieve our object, to get a certain increase in the oat acreage.

The hon. Member for Doncaster (Mr. J. Morgan) expressed the fear that the increase in the oat acreage might be excessive, and that later on it might lead to the Treasury and public opinion demanding a cessation of these payments, and thus the tragedy of the Corn Production Act would be repeated. We have sought to provide against an excessive extension by the proposals in Clause 2 (2), where what is colloquially called the "ceiling" is put at 1,470,000 acres to qualify for the higher rate of subsidy which is earned by people who are registered oat growers, and 1,030,000 acres in the case of those who are registered wheat growers. If the acreage rises above that ceiling the subsidies payable are proportionately reduced.

The other question which the hon. Member asked, and to which he said he had not got an answer, was the reason for taking 14 as a multiple of wheat acreage. The hon. Member for Kincardine and West Aberdeen (Mr. Thornton-Kemsley) gave the hon. Member the answer in his speech. The average production per acre being about 16 cwts. an acre, 2 cwts. have been deducted to allow for seed and waste, thus producing the figure of 14. The hon. Member for Don Valley pointed out that we thought 6 cwts. were sufficient in 1937, and he also referred to the fact that there had been a long succession of Ministers of Agriculture each one of whom got more and more out of the Exchequer, but that none of them had got enough to remove the real grievances of the Scottish oat grower.

In 1937 the idea was, taking the country as a whole, that 6 cwts. an acre was a fair amount to be sold as a cash crop, and the subsidy, or the guaranteed price, was calculated, therefore, on that basis, but events since then have proved that this was unjust to the farmer who does depend mainly on oats for his cash crop, and puts him in an unfair position as compared with the grower of wheat. The proposals in the Bill will, I think, rectify that injustice, and I venture to affirm that we shall see in the next few years an increase in the quantity of land which is put under the plough, and I hope, also, a check on the decline in the agricultural population in these areas.

8.45 p.m.

Photo of Mr Morgan Price Mr Morgan Price , Forest of Dean

Three main points have been raised on this Amendment, and I think two of them have been satisfactorily answered by the Under-Secretary of State for Scotland. First of all, the point was made in connection with marketing, that there would be no incentive to get a better price owing to the absence of a marketing scheme. That was satisfactorily answered. The Under-Secretary of State said that would not be the case, and that, in fact, it would be open to any producer of oats to try to get the best price he could. I think the hon. Gentleman has also shown reasonably that a standard price of 8s. is not unjust. My own experience and figures which I have seen from various sources, with regard to the cost of the production of oats, suggest that on an average, taking different seasons and the soils in different areas, the cost of production of oats is, if anything, more than 8s. a cwt. Therefore, if there is to be a subsidy at all, I do not think it would be reasonable to have a lower figure.

The Minister did not answer the third objection as to why the figure of 14 was inserted, and I think my hon. Friends are right in pressing the Amendment on that ground alone. It is true that 2 cwts. are to be deducted for seed, wastage and so on. I think more than that should be deducted, because in England far and away the larger proportion of oats is consumed on the farm. It seems to have been argued that we might even go up to 6 cwts., which was the figure in the 1937 Act, but that I think would be unfair to Scotland. I think the figure 12 would be a very reasonable one to insert. After all, oats is mainly a crop for consumption on the farm. I am a great believer in oats. I do not believe it is desirable to feed cattle too much on imported cakes, and I believe that oats and beans is the very best feeding stuff for dairy cows. Therefore, in considering the problem, one ought to bear in mind that oats is a feeding crop consumed on the farm, and one ought to make allowances for that. Consequently, I think that 12 cwt., as suggested in the Amendment, is very reasonable.

8.48 p.m.

Photo of Major Frank Heilgers Major Frank Heilgers , Bury St Edmunds

There is one point that was made by the Under-Secretary of State for Scotland to which I wish to refer. He said that the oat growers of Scotland were in an unfair position in comparison with the growers of wheat, and that that would be rectified by the provisions in this Bill. He went on to say that, roughly, the figure of 8s. for oats was a reasonable one when compared with the figure of 10s. for wheat. I suggest to my hon. Friend that that is not a fair comparison. There are 12 stones in a sack of oats and 18 stones in a sack of wheat. If one takes the figure of 8s. for oats, it amounts to 8d. a stone, but to get 8d. a stone for wheat, one would have to raise the price of wheat not to 10s. cwt. but to 12s. cwt. I thank my hon. Friend very much for his argument. I am a wheat grower, principally interested in wheat, and the Wheat Committee is about to consider the whole situation, and on my hon. Friend's argument, they should put up the guaranteed price of wheat to 12s. a cwt.

Photo of Mr John Morgan Mr John Morgan , Doncaster

What about the output of wheat per acre as compared with oats?

Photo of Major Frank Heilgers Major Frank Heilgers , Bury St Edmunds

I admit that one is more likely to get ten sacks of oats and eight of wheat. There is one other point I would like to make, and it has reference to the speech of the hon. Member for the Forest of Dean (Mr. Price). He was arguing, quite rightly, that oats are a principal feeding stuff. Not a great quantity of oats is sold off the farm, but at the present time, every one in this country is alarmed at the possibility of a war, and it is very necessary for us to grow at home as many feeding stuffs as we can. As the hon. Member said, there is no better feeding stuff than oats for cows and other animals. Therefore, if there is a slightly higher subsidy for oats, as is proposed on a 14 cwt. basis, rather than on a 12 cwt. basis, we shall do a great deal to help to provide more feeding stuffs for animals, which is most essential at the present time, in view of a possible emergency.

8.57 p.m.

Mr. Alexander:

There is an old saying that "when thieves fall out, honest men come into their own." Although I do not want to label the Under-Secretary of State and the hon. and gallant Member for Bury St. Edmunds (Captain Heilgers) as thieves, I would suggest that the Treasury is handing out money with an open hand, which is perhaps not quite the same thing; but at any rate it is some encouragement to see these two hon. Members of the Conservative party in disagreement on this matter. I became a little apprehensive when the hon. and gallant Member for Bury St. Edmunds talked about using the argument which the Secretary of State made with regard to oats as a justification for a higher rate of subsidy for wheat. I have looked up the price of wheat on the world market and in most cases it does not reach 18s. a quarter. Already we give a guarantee to the British farmer of 45s., so that at the present time the subsidy must work out at one-and-a-half times the world price of wheat. If the hon. and gallant Member now wants 12s. a cwt. instead of 10s. a cwt., it will put on another 9s. or 10s. subsidy, and will make the subsidy more than twice as much again as the world price at the present time.

Photo of Major Frank Heilgers Major Frank Heilgers , Bury St Edmunds

May I interrupt the right hon. Gentleman? We have just been discussing the question of giving higher wages to agricultural workers. We are all in sympathy with that. If we are to do that—

Photo of Major Frank Heilgers Major Frank Heilgers , Bury St Edmunds

— the farmers must have the means of paying the increased wages. We very much hope that the result of this Bill will be that wages committees, in whose hands the matter will rest, will see fit to give an increase to the agricultural workers if more is put into the hands of the farmers so that they can pay the increased wages.

Photo of Mr John Morgan Mr John Morgan , Doncaster

The Minister did not say that. If he had said that, it might have helped matters.

Photo of Major Frank Heilgers Major Frank Heilgers , Bury St Edmunds

The Minister gave a very strong indication to that effect.

Mr. Alexander:

I appreciate the hon. and gallant Member's interruption, but I am much more interested in the remark that he made in his speech. He said that he is a wheat farmer and that he is interested in the possibility of getting an increase from 10s. to 12s. Over and over again, hon. Members opposite are perfectly frank and say whom they represent and what they want. There they are, standing at the door of the Treasury. I feel that, as we work under some difficulties on the Report stage because of the selection of Amendments, this is an appropriate place to say that there is in this Clause an example of how ridiculous is this method of paying a subsidy. In the 1937 Act, the payment was fixed at six times the difference, and now it is 14 times the difference. The Under-Secretary of State for Scotland has argued that this is really necessary in order to give justice to Scotland, not because Scotland cannot afford to produce oats on the basis of six times the difference, as in 1937, but because thereby they will not get as much monetary grant as the English producers under the wheat subsidy.

Photo of Mr William Snadden Mr William Snadden , Kinross and Western

That was because the wheat farmer was protected with his 45s. deficiency payment, and we were not. As long as you retain the deficiency payment on wheat, you must protect oats, or the oats farmer will go to the wall.

Mr. Alexander:

Is the argument then, that because wheat was cheaper on the world market, the users of cereal feeding-stuffs used more wheat than usual and less oats than usual?

Mr. Alexander:

I like hon. Members who want to teach me on these matters to be more explicit.

Photo of Mr William Snadden Mr William Snadden , Kinross and Western

My argument is that wheat was being protected by a deficiency payment of 45s., and naturally the wheat farmer coming to the market protected in that way, would take any price at all for his wheat. This, of course, brought down the price of oats. As we have no imports of oats, there is no reason for the collapse in oats prices, that I can think of, except that fact.

Mr. Alexander:

There is a passage in "The Lady of the Lake" in which Fitzjames says: I thank thee Roderick for the word. I must thank the hon. Member for having given us the words to describe what we have always claimed to be the case, namely, that the method of subsidising wheat in fact means that the wheat is carried to the market in sucha way that it helps to crash the world price. I suppose if that is true in respect of wheat, the fact that you are now going to apply such a high subsidy, based upon 14 times the difference, in the case of oats, means that you will have the same thing in respect of that 45 per cent, of the Scottish crop which is a cash crop, and that the price of oats will crash in exactly the same way. But the fact is that this subsidy is in no way related to the actual cost of the production of oats. My hon. Friend the Member for Don Valley (Mr. T. Williams) on the Second Reading and in Committee and again to-night has asked for figures to show what economic basis there is for this formula. We are still without an answer. My hon. Friend the Member for the Forest of Dean (Mr. Price) feels satisfied on two out of the three points that have been made in objection to this proposal. I am not as easily satisfied on agricultural formulas as my hon. Friend. He has more experience than I have of agriculture, but even he, with all his experience, is not fully satisfied. I listened to my hon. Friend in the Second Reading Debate giving an interesting discourse on the variety of production costs throughout the country in the case of oats. That statement came from him with all the authority of experience, and I think he said that it was possible to produce, in many parts of the country and with certain varieties of climate, as much as 1 cwt. for 4s.

Photo of Mr Morgan Price Mr Morgan Price , Forest of Dean

And in some cases for over 20s.

Mr. Alexander:

I imagine that my hon. Friend with his experience would agree that the people who grew oats at over 20s. ought to come under Clause 4 of the Bill, in regard to the growing of oats on unsuitable land.

Photo of Mr Morgan Price Mr Morgan Price , Forest of Dean

It might be avery bad season.

Mr. Alexander:

Then they might have special consideration. But do not let us make any mistake about it. This is part of the purchase price of the votes of the agricultural constituencies.

Photo of Sir Reginald Dorman-Smith Sir Reginald Dorman-Smith , Petersfield

What about your guaranteed price?

Mr. Alexander:

As to our guaranteed price, we should certainly have a basis of efficiency and justice in it, and that is what we have been unable to put into this Bill because of the opposition of the Minister. If the Minister proposes to take that line, let me bring him back again to the declaration of his own party in the past. It was mentioned in Committee, but I think it ought to be put on record in connection with the Report stage of the Bill. The White Paper on agriculture issued by the Conservative Government which was in office in 1926 — the Baldwin White Paper on agricultural policy— contained these words: Any general scheme of subsidies for agriculture is open to the gravest objection. They would have to be unlimited in duration and very large in amount to have any material effect in increasing the arable area or the number of workers employed, and in view of the extreme variation all over the country in the quality or productive capacity of land, it is impossible to devise any scheme of subsidies which will not result in the payment of bonus to farmers who do not need it and for which no return will be received by the nation.

Photo of Mr David Quibell Mr David Quibell , Brigg

Which we did not believe.

Mr. Alexander:

We believed it, but apparently the Government do not believe it, or else they feel that they cannot get all the votes they require in any other way. The variety of production conditions throughout the country makes it certain that the fixing of the high ratio of 14 times the difference will enable not only farmers, but landowners in many parts of the country to get away with public money which they ought not to receive. If, at the same time, the Government were to guarantee a minimum wage to the labourer, because public money is being paid out in this way, it might be some mitigation of the offence. But the Minister has not even had the good will to do that. He says he has every sympathy with the farm worker, but he goes on steadily voting money to the farmers and through the farmers to the landlords without making any provision for the workers. My hon. Friend the Member for Don Valley has now, for the third time, sought to extract from the Government a statement of the real economic basis of their formula for the oats subsidy. He has had no effective answer, and I hope, therefore, that my hon. Friends will go with me into the Lobby in favour of the Amendment.

Question put, "That the word 'fourteen' stand part of the Bill."

The House divided: Ayes, 190; Noes, 132.

Division No. 248.]AYES.[9.4 p.m.
Acland-Troyte, Lt.-Col. G. J.Colville, Rt. Hon. JohnFleming, E. L.
Agnew, Lieut.-Comdr. P. C.Conant, Captain R. J. E.Fox, Sir G. W. G.
Allen, Col. J. Sandeman (B'knhead)Cook, Sir T. R. A. M. (Norfolk, N.)Fremantle, Sir F. E.
Aske, Sir R. W.Cooke, J. D. (Hammarsmith, S.)Furness, S. N.
Balfour, G. (Hampstead)Cooper. Rt. Hn. T. M. (E'nburgh, W.)Fyfe, D. P. M.
Balfour, Capt. H. H. (Isle of Thanet)Craven-Ellis, W.Gilmour, Lt.-Col. Rt. Hun. Sir J.
Beamish, Rear-Admiral T. P. H.Croft, Brig.-Gen. Sir H. PageGlyn, Major Sir R. G. C.
Beaumont, Hon. R. E. B. (Portsm'h)Crooke, Sir J. SmedleyGoldie, N. B.
Beechman, N. A.Cross, R. H.Gower, Sir R. V.
Bernays, R. H.Crossley, A. C.Graham, Captain A. C. (Wirral)
Blair, Sir R.Crowder, J. F. E.Grant-Ferris, Flight-Lieutenant R.
Boothby, R, J. G.Davidson, ViscountessGranville, E. L.
Bossom, A. C.Da la Bère, R.Greene, W. P. C. (Worcester)
Bower, Comdr. R. T.Denman, Hon. R. D.Gridley, Sir A. B.
Boyce, H. LeslieDanville, AlfredGrimston, R. V.
Brass, Sir W.Doland, G. F.Gritten, W. G. Howard
Brooke, H. (Lewisham, W.)Donner, P. W.Guest, May. Hon. O. (C'mb'rw'll, N.W.)
Brown, Rt. Hon. E. (Leith)Dorman-Smith, Col. Rt. Hon. Sir R. H.Hambro, A. V.
Brown, Brig.-Gen. H. C, (Newbury)Dower, Lieut.-Col. A. V. G.Hannah, I. C.
Browne, A. C. (Belfast, W.)Drewe, C.Hannon. Sir P. J. H.
Burton, Col. H. W.Duckworth, Arthur (Shrewsbury)Harbord, Sir A.
Cayzer, Sir C. W. (City of Chester)Dugdale, Captain T. L.Haslam, Henry (Horncastle)
Cazalet, Thelma. (Islington, E.)Duncan, J. A. L.Heilgers, Captain F. F. A.
Chapman, A. (Rutherglen)Ellis, Sir G.Hely-Hutchinson, M. R.
Christie, J. A.Emery, J. F.Heneage, Lieut.-Colonel A. P.
Clarke, Colonel R. S. (E. Grinstead)Entwistle, Sir C. F.Hepworth, J.
Cobb, Captain E. C. (Preston)Erskine-Hill, A. G.Hogg, Hon. Q. McG.
Colfox, Major Sir W. P.Everard, Sir William LindsayHolmes, J. S.
Horsbrugh, FlorenceMorris-Jones, Sir HenryStorey, S.
Hudson, Rt. Hon. R, S. (Southport)Morrison, G. A. (Scottish Univ's.)Strauss, H. G. (Norwich)
Hume, Sir G. H.Morrison, Rt. Hon. W. S. (Cirencester)Strickland, Captain W. F.
Hunter, T.Munro, P.Stuart, Lord C. Crichton- (N'thw'h)
Hurd, Sir P. A.Neven-Spence, Major B. H H.Stuart, Hon. J. (Moray and Nairn)
Hutchinson, G. C.Peaks, O.Sueter, Rear-Admiral Sir M F.
Jarvis, Sir J. J.Perkins, W. R. D.Sutcliffe, H.
Jennings, R.Peters, Dr. S. J.Tasker, Sir R. I.
Jones, L. (Swansea W.)Petherick, M.Thomas, J. P. L.
Kellett, Major E. O.Pickthorn, K. W. MThomson, Sir J. D. W.
Kerr, Sir John Graham (Sco'sh Univs.)Radford, E. A.Thorneycroft, G. E. P.
Kimball, L.Raikes, H. V. A. M.Thornton-Kemsley, C. N.
Lamb, Sir J. Q.Rathbone, J. R. (Bodmin)Touche, G. C.
Leech, Sir J. W.Reed, A. C. (Exeter)Tufnell, Lieut.-Commander R. L.
Leighton, Major B. E. P.Read, Sir H. S. (Aylesbury)Turton, R. H.
Lennox-Boyd, A, T. L.Reid, J. S. C. (Hillhead)Wakefield, W. W.
Lewis, O.Remer, J. R.Walker-Smith, Sir J.
Liddall, W. S.Rickards, G. W. (Skipton)Ward, Lieut.-Col. Sir A. L. (Hull)
Lindsay, K. M.Ropner, Colonel L.Ward, Irene M. B. (Wallsend)
Little, Sir E. Graham-Rosbotham, Sir T.Wardlaw-Milne, Sir J. S.
Llewellin, Colonel J. J.Ross Taylor, W. (Woodbridge)Waterhouse, Captain C.
Locker-Lampson, Comdr. O. S.Rowlands, G.Wayland, Sir W. A
Loftus, P. C.Royds, Admiral Sir P. M. R.Webbe, Sir W. Harold
M'Connell, Sir J.Ruggles-Brise, Colonel Sir E. A.Wedderburn, H. J. S.
McCorquodale, M. S.Salmon, Sir I.Wells, Sir Sydney
MacDonald, Sir Murdoch (Inverness)Salt, E. W.Whiteley, Major J. P. (Buckingham)
Macdonald, Capt. P. (Isle of Wight)Samuel, M. R. A.Wickham, Lt.-Col. E. T. R.
McEwen, Capt. J. H. F.Sandeman, Sir N. S.Windsor-Clive, Lieut.-Colonel G.
Manningham-Buller, Sir M.Sanderson, Sir F. B.Womersley, Sir W. J.
Margesson, Capt. Rt. Hon. H. D. R.Schuster, Sir G. E.Wood, Hon. C. I. C.
Markham, S. F.Shakespeare, G. H.Wragg, H.
Marsden, Commandser A.Shepperson, Sir E. W.Wright, Wing-Commander J. A. C.
Maxwell, Hon. S. A.Smiles, Lieut.-Colonel Sir W. D.York, C.
Mellor, Sir J. S. P. (Tamworth)Snadden, W. McN.
Mills, Major J. D. (New Forest)Somervell, Rt. Hon. Sir DonaldTELLERS FOR THE AYES.—
Moreing, A. C.Southby, Commander Sir A. R. J.Major Sir James Edmondson and Mr. Buchan-Hepburn.
Morgan, R. H. (Worcester, Stourbridge)
Acland, Sir R. T. D.Griffith, F. Kingsley (M'ddl'sbro, W.)Oliver, G. H.
Adams, D. (Consett)Griffiths. G. A. (Hemsworth)Paling, W.
Adams, D. M. (Poplar, S.)Griffiths, J. (Llanelly)Parker, J.
Adamson, Jennie L. (Dartford)Groves, T. E.Parkinson, J. A.
Adamson, W. M.Hall, G. H. (Aberdare)Pearson, A.
Alexander, Rt. Hon. A. V. (H'lsbr.)Hall, J. H. (Whitechapel)Pethick-Lawrence, Rt. Hon. F. W.
Ammon, C. G.Hardie, AgnesPoole, C. C.
Anderson, F. (Whitehaven)Harris, Sir P. A.Price, M. P.
Banfield, J. W.Harvey, T, E. (Eng. Univ's.)Pritt, D. N.
Barnes, A. J.Hayday, A.Quibell, D. J. K.
Barr, J.Henderson, A. (Kingswinford)Richards, R. (Wrexham)
Batey, J.Henderson, J. (Ardwick)Ridley, G.
Beaumont, H. (Batley)Henderson, T. (Tradeston)Riley, B.
Benn, Rt. Hon. W. W.Hills, A. (Pontefract)Ritson, J.
Bevan, A.Isaacs, G. A.Seely, Sir H. M.
Broad, F. A.Jenkins, A. (Pontypool)Shinwell, E.
Brown, C. (Mansfield)Jenkins, Sir W. (Neath)Silkin, L.
Burke, W. A.John, W.Simpson, F. B.
Cape. T.Johnston, Rt. Hon. T.Sinclair, Rt. Hon. Sir A. (C'thn's)
Charleton, H. C.Jones, A. C. (Shipley)Sloan, A.
Chater, D.Jones, Sir H. Haydn (Merioneth)Smith, E. (Stoke)
Cluse, W. S.Kennedy, Rt. Hon. T.Smith, T. (Normanton)
Cocks, F. S.Kirby, B. V.Sorensen, R. W.
Collindridge, F.Kirkwood, D.Stephen, C.
Cove, W. G.Lansbury, Rt. Hon. G.Stewart, W. J. (H ght'n-le-Sp'ng)
Cripps, Hon. Sir StaffordLawson, J. J.Stokes, R. R.
Daggar, G.Leach, W.Summerskill, Dr. Edith
Dalton, H.Lee, F.Taylor, R. J. (Morpeth)
Davies, R. J. (Westhoughton)Logan, D. G.Thurtle, E.
Davies, S. O. (Merthyr)Lunn, W.Tinker, J. J.
Day, H.Macdonald, G. (Ince)Tomlinson, G.
Dobbie, W.McEntee, V. La T.Viant, S. P.
Dunn, E. (Rother Valley)McGhee, H. G.Watkins, F. C.
Ede, J. C.MacLaren, A.Watson, W. McL.
Edwards, Sir C. (Bedwellty)Maclean, N.Welsh, J. C.
Edwards, N. (Caerphilly)Marshall, F.Westwood, J.
Fletcher, Lt.-Comdr. R. T. H.Maxton, J.White, H. Graham
Frankel, D.Messer, F.Williams, E. J. (Ogmore)
Gallacher, W.Montague, F.Williams, T. (Don Valley)
Gardner, B. W.Morgan, J. (York, W.R., Doncaster)Windsor, W.(Hull, C.)
Gibson, R. (Greenock)Morrison, Rt. Hon. H. (Hackney, S.)Woods, G. S. (Finsbury)
Graham, D. M. (Hamilton)Morrison, R. C. (Tottenham, N.)Young, Sir R. (Newton)
Green, W. H. (Deptford)Nathan, Colonel H. L.
Greenwood, Rt. Hon. A.Naylor, T. E.TELLERS FOR THE NOES.—
Grenfell, D. R.Noel-Baker, P. J.Mr. Whiteley and Mr. Mathers.sss