Expenditure Arising Out of the War

Orders of the Day — Supplementary Vote of Credit, 1942 – in the House of Commons on 9th September 1942.

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Question proposed, That a Supplementary sum, not exceeding £1,000,000,000, be granted to His Majesty, towards defraying the expenses which may be incurred during the year ending on the 31st day of March, 1943, for general Navy, Army and Air Services and supplies in so far as specific provision is not made therefor by Parliament; for securing the public safety, the defence of the realm, the maintenance of public order and the efficient prosecution of the war; for maintaining supplies and services essential to the life of the community; and generally for all expenses, beyond those provided for in the ordinary Grants of Parliament, arising out of the existence of a state of war.

Photo of Sir Kingsley Wood Sir Kingsley Wood , Woolwich West

I hope that hon. Members will consider that it is well to turn now, for a short period at any rate, to a consideration of some of our financial affairs. The further Vote of Credit of £1,000,000, 000 for the prosecution of the war which the Committee is being asked to grant makes a total of £3,000,000,000 for Votes of Credit during the current financial year and a total of £11,050,000,000 since the beginning of the war. During recent weeks our war expenditure has averaged £12,250,000 a day, made up of £10,250,000 a day on the Fighting and Supply Services, and £2,000,000 on the other miscellaneous War Services. My hon. Friends will no doubt note the comparison I am about to make. In comparison with the figures which I gave in June, these figures show an increase of £500,000 a day on the Fighting and Supply Services, which continues the steady increase in this vital part of the cost of the war. There has been a decrease of about £250,000 on the Miscellaneous War Services, the cost of which, as my hon. Friends will be aware, is liable to appreciable fluctuations for a variety of reasons, including the irregular incidence of receipts from various trading operations.

It is apparent that as we approach nearer to the full use of our capacity to produce the munitions of war, the rate of expenditure on the war does not, of course, continue to increase as rapidly as it has done in the past. But the increase over the last two years has been eloquent both of the growing intensity of the physical effort of production and of the financial effort required to support that production. In those years we have seen the daily expenditure on the war mount from £8,000,000 to £9,000,000, £10,000,000, £11,000,000and £12,000,000. The total Budget expenditure we have to finance has grown from £3,884,000,000 in 1940–41 to an estimated figure of £5,286,000,000 for the current year.

The increase in the physical war effort is shown by the fact that whereas in 1940 Government expenditure on goods and services absorbed 44 per cent. of the national resources, the corresponding figure for 1942 will probably be about 54 per cent. What is, I think, still as striking is the fact that there has been no tiring or hesitation in the great sacrifices which our people have made and are making to meet as much as possible of this huge expenditure by current taxation. They have gone on shouldering with fortitude and courage increasing burdens. Whereas we financed by taxation 35 per cent. of our total Budget expenditure in 1940–41, we are this year finding in taxation 45 per cent., and that, moreover, of an expenditure which is itself more than a third greater than then. Looked at from another angle, whereas taxation took 33 per cent. of the national income in 1940, it will probably take something like 40 per cent. in 1942.

We have just completed three years of war. In those three years the war has cost us £10,000,000,000, and including the cost of the debt and our normal peacetime services, our total expenditure has been £12,100,000,000. Of that huge total we have met 40 per cent. out of taxation. The figures of total costs have reached dimensions which, as one of my hon. Friends indicated a month or so ago, it is very difficult to appreciate, but there is no mistaking the practical meaning of our taxation policy. That policy, much more drastic than was adopted in the last war, has certainly been of inestimable benefit in counteracting the inflationary tendencies inherent in the situation and in respect of which we have always to be on our guard.

I would like to say a word now on the position of the Savings Campaign, because the matter has been raised even since we returned. This is a very important matter. The Savings Movement has played a vital part in our war effort. I do not hesitate to say that that movement has been a great success. Some £4,200,000,000 has been raised since the beginning of the war. I observe that some of my hon. Friends have put Questions as to recent progress, using as a yard measure figures which were published week by week by the National Savings Committee. I do not object to that for a moment. Interest in those figures is all to the good, since they give us some guidance as to progress, but some of them, at certain periods of the year, are affected by matters like holidays, and we can obtain only a rough approximation of our rate of genuine savings in this way. There are also, of course, other considerations. There has, for instance, been a fall in the subscriptions for the 3 per cent. Defence Bonds, but it must be remembered that these were issued with the primary object of providing a means whereby the small investor who had already purchased his full quota of National Savings Certificates could continue to lend his savings to the State. In this way they are fulfilling their object very successfully. These bonds are not restricted to the small investor. Commercial and other business concerns have taken full advantage of the facilities to invest in the bonds up to £1,000, but the number of such investors is limited, and as more of them acquire the full quota, sales inevitably tend to decline on this account.

Let us look at some other aspects of this matter which are far more important. During the first seven months of this year, the sale of National Savings Certificates and deposits in the national savings banks were up by over 10 per cent., compared with the corresponding period last year. The question of the quality of savings has often been referred to by hon. Members in all parts of the House. I can tell them that all the evidence suggests that there has been a very substantial improvement during the current year, and I think our best guide to this quality is the figure for sale of National Savings Certificates of small denominations. In the eight months to the end of August we sold no less than 34 per cent. more of these than we sold in the first eight months of 1041. Having said all that, I would repeat what I said this morning to a National Savings assembly to which representatives of the workers came from all parts of the country. I had the privilege of speaking to them this morning, and I warned them, as I warn the Committee now, that there is no ground for complacency and self-satisfaction. August brought an improvement on the rather low savings figures of July, but there is still urgent necessity and scope for the further reduction of personal expenditure and for more savings. If we fail to do this, we are jeopardising the strong financial front that we have built, and we are also prejudicing our hopes and prospects for the post-war period.

I would speak again of saving, as I have often spoken before, and I do not apologise for it. I say that we must not only save, but each one of us must practise strict economy and avoidance of waste, both in our personal affairs and in our work and business activities, whatever they may happen to be. I have often stressed, and I stress again to-day, the vital importance of the avoidance of waste, not only by individuals but by Government Departments and Government servants. To-day I should particularly like, just for a minute or two, to deal with its positive counterpart, efficiency, and briefly refer to certain measures which we have been taking to secure further efficient organisation in the Government service.

Photo of Mr John Wardlaw-Milne Mr John Wardlaw-Milne , Kidderminster

I hope my right hon. Friend will forgive me for interrupting him. He has made a very interesting statement with regard to savings, with which statement we all agree. I would like him to give us the figure of the proportion of Government expenditure which is met from savings of all kinds. He gave us the total of 40 per cent. of Government expenditure raised from taxation; could he tell us how much of the remaining 60 per cent. is raised by savings? I do not know whether he has that figure conveniently at hand.

Photo of Sir Kingsley Wood Sir Kingsley Wood , Woolwich West

I will try to give my hon. Friend that information later in the Debate.

Mr. J. J. Davidson:

Can the right hon. Gentleman give us any indication of the number of interest-free loans during the past year?

Photo of Sir Kingsley Wood Sir Kingsley Wood , Woolwich West

I will ask my right hon. and gallant Friend the Financial Secretary to the Treasury to give that figure. As a matter of fact, I gave the figure two days ago when I spoke at Dundee.

Mr. Davidson:

I was asking for the trend.

Photo of Sir Kingsley Wood Sir Kingsley Wood , Woolwich West

I will ask my right hon. and gallant Friend to deal with the matter.

Photo of Mr Campbell Stephen Mr Campbell Stephen , Glasgow Camlachie

The right hon. Gentleman stated that the total amount of savings had been £4,200,000,000 since the beginning of the war. The National Debt has increased by £7,000,000,000, I think, in the same period. Can the right hon. Gentleman say where the difference of about £3,000,000,000 has gone?

Photo of Sir Kingsley Wood Sir Kingsley Wood , Woolwich West

I will get my right hon. and gallant Friend to deal with that also. As a matter of fact I gave an answer to-day as regards particulars of the National Debt. I do not know whether it will be given in the OFFICIAL REPORT. My hon. Friend must not assume that I accept the figures which he gave. I was just about to allude to the counterpart of savings and the avoidance of waste, the promotion of efficiency. I was going to tell the Committee what steps we have recently taken. My hon. Friends have put Questions from time to time as to what steps have been taken by the Government and the Treasury in that direction. I would like to refer to the important question of the adoption by Government Departments of modern methods. For some time past the Treasury have had, for instance, a small section dealing with the use of modern office appliances and acting as advisers to the Departments in this field. With the outbreak of the war, the Treasury began the process of further strengthening this section and expanding its functions, in order that guidance should be given to Departments in the application of new methods of administrative management, in instituting effective operating methods and in achieving economies in time, effort and man-power.

That section comprises some 50 officers most of whom are non-Civil servants and men who have had professional experience in business, efficiency and scientific management or have had useful organising experience in industry and commerce. As I am glad to tell the Committee, much useful work was done in 1940, enough to make it clear that modern techniques of organisation could continue to make an important contribution to the Civil Service. Progress was made, for instance, in the preparation of manuals of organisation; the elimination of overlapping by reallocation of duties; the simplification and standardisation of clerical and accounting procedures and other processes involving a large volume of routine work.

Two further developments took place in this connection in 1941. In July of that year a communication was" sent by the Treasury to some of the larger Departments suggesting that they should develop this "organisation and methods" work on permanent Unes, and should themselves set up sections staffed by persons with training and experience in this particular type of work. The Admiralty, the Air Ministry and the Ministry of Food how have Organisation and Methods Sections of their own. In the War Office and the Ministry of Supply comparable organisa- tions have been in existence for some time. Other Departments have taken on one or more outside experts to help them.

The second development was that the Treasury staff engaged on this work was itself put under the direction and control of a small Advisory Panel of men of standing and experience in the business world. The purpose of this step was to ensure that the work done in Departments should be co-ordinated and that the results obtained should be made generally known and available. At any rate, I would claim this, that much has been done in this way in securing further efficiency and modem methods in Departments, and no doubt, I agree, more can and will be done.

I wish now to turn to a larger aspect. These great and successive sums which Parliament votes for the prosecution of the war should properly be set in a wider context than our own internal war effort. They can well be regarded more properly as the contribution which we in this country are making to the common pool of the United Nations. The President of the United States led the way to this wider conception when, nearly two years ago, before the" United States had entered the war, he launched the great experiment of Lend-Lease, and in so doing assured to us, without regard to our own financial resources, that ever-growing stream of assistance to which I have so often referred in statements in this House.

Lend-Lease, as the President himself said, got rid of the dollar sign, and by that single stroke of policy the whole of war finance between the United Nations was placed on a new basis. We have not been backward in following this example. We have furnished military supplies to our Allies, Russia and China, without question of payment. And now Lend-Lease itself, to quote the President, "is no longer one-way." As the American Army becomes ever more ready on an ever-increasing scale for active participation, and American troops go on arriving in great numbers on Australian and British soil, there is much that we and the rest of the Commonwealth, acting in unqualified agreement with the basic principle laid down by the President, can supply through reciprocal aid to those who helped us in our hour of greatest need.

The principle is one of a common pool to which we give what we can and from which we receive what we can best use. I would assure my hon. Friends, if assurance is needed, that we are not trying to calculate what we give by any external yard-stick. Nor do we, any more than the Americans, measure it out by reference to what we receive; we are simply anxious to give to our Allies those supplies and services which we can best furnish. If they have what they need from us, we are doing our share. That is the principle of pooling, which applies as much in the sphere of finance as in other spheres.

The American Forces in this country ask us for accommodation, supplies, labour, transport, all the hundred and one things an Army needs from the biggest to the smallest, and we give them as reciprocal aid. Outside this country, they receive what they need in the Colonies, and our shipping is at their disposal. We do not, of course, ship many military supplies to the United States, since that is not the natural flow of weapons in these days; but where, in any part of the world, they need any such supplies from our resources, we give them as reciprocal aid, and we are aiming, so far as it lies with us, at a distribution of the financial costs of war, to use the words of Mr. Roosevelt, which will mean that no nation will grow rich from the war effort of its allies. The money costs of the war will fall according to the rule of equality in sacrifice, as in effort. That does not mean that this country will not have suffered great financial sacrifices when the final account comes to be made up. We shall have incurred large liabilities to be discharged in the future, not only internally but to those countries overseas in which the principle of reciprocal aid has not been or cannot be applied. We shall also have parted with much of the thrifty accumulations of the savings of past years in our overseas investments.

But when we turn to the problems of the post-war world we find in the principle of mutual aid the indispensable condition of an improved system of economic and monetary intercourse between countries, which is the key to the prosperity and peace of the comity of nations. It is the key to the future in the sense that it is the indispensable means of realising the considerable potential re- sources which the progress of science and knowledge has been making possible, but which we have not yet been able to exploit to the full. We are not ready to make public all that is in our minds, especially because we want to discuss our ideas frankly and fully with our friends and Allies without any prior commitment to hard and fast plans. But we have by no means been idle. We are giving our best thought and endeavour to the most fundamental of those matters which need decision, and we are making good progress, and while we cannot, and do not wish to, make these matters public, we are certainly determined that no one will be able to say that the difficult and dangerous problems of the postwar period will find us unprepared on the economic and financial side. The series of great speeches lately made by American statesmen give ground for high hopes, for it is evident that our objects and purposes are the same.

I must allude to another side, the domestic problems which we shall have to face——

Photo of Sir Joseph Lamb Sir Joseph Lamb , Stone

I do not wish to interrupt my right hon. Friend unnecessarily, but before he leaves this point would he say whether our contribution to Lease-Lend applies to raw materials as well as to the arms he mentioned?

Photo of Sir Kingsley Wood Sir Kingsley Wood , Woolwich West

I will give my hon. Friend a copy of the actual agreement which has been signed, which I think includes that information. I was referring to the domestic problems we shall have to face when victory has been won. These will, in the earlier post-war period, be very much like the problems which we have to face to-day. We are now producing goods on a vast and unprecedented scale, but we are devoting the greatest possible part of them to the purpose of winning the war, and we have therefore had to take measures to ensure that what is left over for our civilian needs is economically used and fairly distributed. Rationing and control are necessary because goods are in short supply, and shipping has to be economised. After the war shipping must for some time continue to be difficult, and certain goods at any rate must continue to be in short supply. We shall have to devote a considerable proportion of what we produce to repairing the damage which has been done, to replenishing our stocks, to employing our people and to restarting our economic life. We shall have a great task before us, and to make sure that we go about this task m the best possible way it will be necessary, as I have already stated, to maintain, for some time at any rate, a considerable measure of our war-time system of control In particular we shall have to concentrate on the problem of exporting enough from this country to pay for the imports which we shall need to maintain an adequate standard of living.

As time goes on we may hope that the shortage of commodities will have been remedied. But this should not mean that we relax our efforts towards a better economic life. The task before us is to maintain the greatest possible amount of employment, and the fullest use of our productive capacities, as successfully in time of peace as in time of war. What are our prospects in this task? They depend not only on the foresight and wisdom of statesmen, but upon each one of us in the conduct of our daily life. We shall not achieve our aims without hard work, personal initiative and a willingness to sacrifice our own immediate advantage, whenever necessary, to that of others, together with a spirit of patience and good understanding. Without these the wisest statesmanship would be of no avail to us.

I hope the specious argument has gone that because we are now spending some £12,000,000 a day on the war it should somehow or other be easy, now or after the war, to find more millions for one or other beneficent purpose. The resources of the State are not unlimited, and the fact that we have had to mobilise those resources in unprecedented fashion for the purpose of the war does not make it easier to find money for other purposes, but much more difficult. There is also another argument which has been recently advanced by the supporters of various schemes—that our national income has mounted by leaps and bounds and that the principal question before us is not whether we have the money but how this immense growth in wealth should be distributed. I would call attention to the answer I gave to my hon. Friend the Member for Aylesbury (Sir S. Reed) on this subject on 5th August. He asked me if I could give authoritative figures for the comparison between the national income before the last war and the national income before the outbreak of the present war, making allowance for the increase of prices and for any other factors which were relevant to the comparison between the two periods. I replied that figures of this character must necessarily contain a large element of estimation, but that for reasons set out in my reply, to which I refer my hon. Friends, the average increase in real income per head of the working population of 1938 over 1911 might be estimated to be of the order of 25 per cent., a very different rate of increase from the doubling or trebling which has sometimes been spoken of by enthusiastic advocates of particular projects.

On the other hand, with all of us in our individual conduct facing the problems of peace with the same energy and courage as our people have shown in facing the problems of war, and with the nations working together for a wiser and better ordering of the economic affairs of the world, we need not let our financial tasks dismay us. We have been able hitherto to finance the war on sound lines, and if we proceed with equal circumspection in the future, and continue to husband our financial strength, we can face the tasks before us with confidence. The immense productive capacity of the world, which at present is being used for purposes of destruction, will then be available to us, if we are wise enough to use it, for achieving a better and more secure life for all mankind.

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

The Committee have heard with interest, as they always do, the review which the Chancellor of the Exchequer has put before us of the financial position in connection with this Vote of Credit. The Committee is aware that to-day we are facing another milestone in our financial history with the bringing into effective immediate operation of the third £1,000,000,000 during the current financial year. The Chancellor has told us of the still growing rate of daily expenditure on the war and the whole financial services of the nation. With these serious and grave figures before us we naturally have to take stock of our position. I think the Chancellor said that the actual expenditure has gone up by something like £500,000 per day during a certain number of months. The receipts from taxation are not going up as fast. It is quite true that in the second half of the financial year we hope to get a larger revenue than we did in the first. That is common to every year. But in spite of the additional taxation which the Chancellor has imposed, the taxes are not bringing in as much additional revenue as the additional cost of the war is causing additional expenditure. Therefore, it is essential that we should succeed in getting savings to fill the gap. Although we have done very well in this war—far better than in. the last war—in making ends meet, and although to a large extent, if not entirely, we have excluded inflation—which we certainly did not in the last war—we are not yet entirely out of the wood. It might easily come about that, just as it was the last straw which broke the camel's back, it will be the last million a day which will drive us into inflation and bring all the evils which follow in the course of inflation.

Therefore, I support very strongly the Chancellor's request that the savings campaign should go on with redoubled vigour, and that we should raise additional savings. With regard to that, I confess I am not altogether happy. All this additional expenditure that we are incurring on behalf of the war comes in the first instance, in the shape of money, back to the individual citizens of this country and it should form the basis of an opportunity for further savings. I am afraid we cannot claim that there has been anything like the whole of that money available in additional savings. However sound are the lines on which we have been proceeding—and I think the Chancellor is right—it is of the utmost importance, if the grave danger of inflation is to continue to be avoided, that people who possibly can do so should save, and so prevent the nation from consuming its energies in the production of private commodities unless they are essential to the life and health of our people.

I was very glad to hear what the Chancellor had to say about Lease-Lend and our relations with the United States. It is a good thing that this should come on a reciprocal basis to-day, and no doubt, as the war proceeds, it will have to come with regard to all the United Nations. The curse of the last war, in the financial sense, was that we endeavoured to carry over in terms of peaceful trading, of imports and exports, the burdens that had been created by war relations. It is the genius of President Roosevelt that invented the Lease-Lend arrangement to avoid that catastrophe. The more we succeed in starting the world after the war free of impossible financial relations arising out of the war, the better are our chances of solving world problems in the future.

Having said that with regard to the Chancellor's remarks to-day, I propose to say a few words on the larger issues which the whole of this Debate, beginning yesterday, has raised. The Prime Minister, as we always expect from him, made a lucid and extended report on the war, as far as it is possible for such a report to be made; but the more he told us, the more I realised how little in fact we were actually being told. Not that I blame him for that; obviously, there are many things that we cannot be told. But I realise more than ever the meaning, in a sense different from that in which it is usually used, of the phrase, "the fog of war." Although the war is raging in six continents and over the seven seas, the knowledge we in this House have of what is actually taking place is exceedingly limited. I do not think it is the wish of this House, certainly not of that part of the House which is informed, and I do not think it is the wish of the disciplined part of the country, to interfere in the conduct of the war in those fields where interference would be harmful because it would be based upon inadequate knowledge. We cannot interfere with military tactics, nor can we, except for one or two exceptionally-informed individuals, attempt to interfere with or to influence the policy of the Government on the military strategy of the war. What we can do without expert military knowledge is to express opinions on the major lines of strategy, which affect not merely the military conduct of the war but the political relationships of peoples and the political relationships of individuals within the countries. It is that ultimate major strategy upon which this House, speaking on behalf of the country as a whole, hast a right to pronounce.

Of what does the country want to be sure? It wants to be sure that the war is being waged with the best opportunity of success and with the greatest hope of victory, of winning not only the war but also the peace that is to follow the war. That is all part of one objective upon which the country is more determined to- day than it has been in any previous months of this war. The first essential is that there should be maximum production. I yield to none in admiring the magnificent way that this country has been transformed from a peaceful country, producing for the ordinary joys of peace, to a country producing for the prosecution of war. I think the transformation has been wonderful, and on a scale almost unequalled in any other part of the world; but, having said that, I am very far from believing that it is at its maximum. I believe that those who have been to different parts of the country will agree that, splendid as has been the effort, and splendid as has been the achievement, there is still a considerable amount to be achieved. I spent part of the vacation in my constituency, at Edinburgh. I found considerable unrest there among the workers, because they considered that the working capacity of Edinburgh had not been utilised to anything like its full extent. They told me that there are large parts of factories not being used, that there are machines lying idle, that there are services capable of being rendered by large numbers of workers in Edinburgh that are not being employed. They believe that a very much greater amount of work could be done in the south-east of Scotland. One result of this failure—as they think—to use the potential productive capacity of that part of Scotland is that men, and more particularly girls, are being sent South, to the Midlands of England.

Therefore, as far as that part of the country is concerned, there is a sense of not producing to anything like the maximum scale. On my way South I stopped at a large manufacturing town in Lancashire and I went to see a works which had not, before the war, been used for munition purposes at all, but for entirely different objects, and a large part of it had at the Government request been set aside for storage and for manufacturing work. Again, I was greatly impressed by the splendid way the work was being carried out, but there, too, I learned from the management that they were really only working up to 50 or 60 per cent. of what they really could do. If they were not in a bottleneck, if they had the tools and if they had the orders from the Government and the raw material they could work a great deal more and turn out a much larger production. I am not stating this in order to put blame upon the Government. It is a question of trying to get the maximum production, which depends partly upon raw material, tools, where factories are placed and upon labour. On the impression I formed in both districts to which I refer, as far as factory sites and labour are concerned, they could do a great deal more if opportunity was brought their way.

The second question with which the country, as I see it, is concerned is that the maximum strategic use should be put of the production and of the man-power of the nation in carrying through this war. There is a great deal being said at the present time in regard to a second front, and I believe it is true that there is a determination on all sides in this House and in the Government to wage war against Germany in the most effective way and that nothing of a political character, to say the least of it, stands in the way of a second front. A second front, on the other hand, if and when it comes, as it ought to come, I think everybody agrees, is going to be a grim and bloody business, and certainly, as far as I am concerned, I shall not take on a responsibility which is not mine of attempting to judge the hour or the place or the means by which a second front should be put through. But what the country has wanted, and to a great extent I think it got from the Prime Minister yesterday, was an assurance that no cost however hard, however dangerous, however bitter should be shirked in order, at the earliest possible opportunity, to bring aid to our courageous, heroic and effective Russian Ally. I believe that the Prime Minister's statement yesterday, reinforced as I hope it will always be in the position put forward by the Government, will give the country that assurance. I hope, on the other hand, that no one—certainly I shall not attempt to take the responsibility—will urge that a second front should take place before the Government are ready that it should be so thereby possibly courting a failure which might have most disastrous consequences.

In the third place the country are concerned about our people during the war. They are concerned that there should be an equality between the soldier and the civilian, that this should apply during the war, and that when the war is over the soldier should at any rate start equal in the race with, the man who has had, it may be, a hard physical job, but who has not had the dangers and the perils which the soldier has had to face. I do not propose to dwell on that because that will obviously form the theme in the main of what is going to be said in the Debate on the next Sitting Day, and therefore I propose to pass that by.

There is another comparison which is also one that the country is making today, and that is, between the two sexes. I spoke of my visit to a factory in Lancashire where I saw munitions being made. We read about the work that Women are doing in the factories but I confess, even having read all that was said, I was amazed at the wonderful work that they were carrying through, often hard physical work, and at the satisfaction which I learned on every hand they were giving in their work. We know quite well from visitors from overseas, whether they have been Americans, from the United States or Canadians or New Zealanders, that the contributions which women have made here to this war have been the theme of their laudatory remarks. I do not think that anyone can possibly deny that the contribution that women have made in this war has been of a kind which the country could not have done without. Without the work they have done in every field we would have been in a very different position from what we are in to-day. I have had the experience in my life of a great deal of work alongside of women and it has been no surprise to me that women, given the opportunity, have responded so magnificently and so valuably to the country's effort.

Women have always asked two things. They have asked for opportunity and recognition, and as far as opportunity is concerned, it has largely come their way during the present war. When we come to recognition, I confess that I do not think that we have played quite fairly by them. We have had recognition in words. Recognition in words is a very useful and flattering thing but I do not think that we have altogether had recognition in deeds, deeds meaning mainly remuneration. We have a standard in the Services that has been expressed roughly as a two-thirds standard—that a woman is worth financially about two-thirds of a man. I do not think that that standard can be main- tained. I do not believe that that is in accordance with the views of the country and we have to do better than that. We have to put women, as human beings, on an equal footing with men in a great many ways in which we do not put them at the present time. I am not going into details, but the Committee will remember that there is a Motion before this House in the name of the hon. Lady the Member for Frome (Mrs. Tate) dealing with the question of compensation for injuries, and it would obviously be improper for me to go into that matter in any detail beyond just mentioning it.

Then there is a question which directly concerns the Chancellor, namely, the question of post-war credits. I understand that there is a great deal of feeling about the matter, not so much as to the amounts as to the fact that these post-war credits go in all cases to the husband, and where a husband is dealing with the Income Tax, a wife, if she is to get her money back, has to get it from her husband. That may be an erroneous impression, but it is an impression which a number of married couples have, and I understand there is great resentment about it. I do not want to go into further details on this question except to repeat that women have had a great opportunity during this war. They have risen to that opportunity magnificently, as everyone knows, but there is still lacking the recognition—certainly in the financial field—to which they are entitled in view of their splendid and efficient services.

Now I come to my next point, which relates not so much to the period during the war as to the period after the war. You can look at the period after the war from two points of view. You can look upon it as something which, when this war is over, we shall have to settle later, and that is in the main true, but not quite the whole truth, because the idea of what we are to do after the war is itself part of the war effort. People can be induced to fight, to go through the terrible hardships which fighting involves, and even to sacrifice their lives, on one condition only—the condition that the sacrifices they are making are being made for some worthy and adequate objective. To Europe and the countries both inside and outside the British Commonwealth beyond we have to make it quite clear that the world we are hoping to create will be something in which they can take an honourable part. That applies to our own Colonies, and to the great country of India. Again, I will not anticipate what is to be the subject of a later Debate, but perhaps I may be allowed to say this one thing. We have planned a new life for India. Large parts of that country have at present rejected it, but I hope very much that we shall close no door on any sensible proposal that may come from inside that country to deal with the impasse which is at present prevailing there.

I want now to come to what I might call the domestic objective of the war. It is part of the means of raising the morale of this country, of those who are working as civilians and those who are working at dangerous tasks on the sea, on land and in the air, that they should have a vision of the future of this country that appears to them worth while. If they have the idea that they are fighting to revert to the world that was before, then they will not have the heart they would like to have in order to prosecute this war. When this war comes to an end a different order of life from that which existed before the war must be established, not the kind of new order which Hitler wants, which is a descent into barbarism, but a new order in which men, women and peoples stand on a footing of equality and have opportunity presented to them such as they have never had in days gone by. I was glad that the Chancellor, in the course of his speech, made reference to the position after the war. He realised that although we talk of it in terms of finance—and it can be measured in terms of finance to some extent—it is the economic capacity of this country which really counts. I do ask that those who are guiding the destinies of this country at the present time may never lose sight of the fact that it is not merely an academic idea of moment, but is a real guiding principle in the successful prosecution of the war that they should not think of the war as simply a national war between one country and another, but should think of it as a war for a form of life as against the degrading form which is put forward by the Nazi regime.

As I have said, we have reached another stage in the war by our Vote to-day. It seems to me that up to now we have been climbing all the way to reach something like equality with the Nazi armed forces that extend throughout the world. It is as though we have been trying to cross a great continent. To march through the plains we have been ascending the lower foothills this last year or so. Now we are going up to the higher summits. The paths that seemed fairly clear in front of us have become obscured by the very fact that we are right in the passes through the mountains. The day is coming—I hope before very long—when we shall have reached the summit and begun the descent. I hope the passage across the mountains down to the valleys to the victory that lies on the other side will be not too lengthy and that it may lead us into a better and happier country than we have had before.

Photo of Mr Henry White Mr Henry White , Birkenhead East

I have often heard Members in the past say, before a powerful and polished speech, that they had no intention of intervening in the Debate, and I ask the Committee to believe that that is true of myself to-day. As the Debate proceeded, however, there were one or two points upon which I felt moved to address one or two observations if Members are disposed to listen to them. I would like to say at once that I am in general agreement with my right hon. Friend the Member for East Edinburgh (Mr. Pethick-Lawrence) in the general scheme of what he thinks is necessary for the morale of this country at the present time, namely, that we should proceed without any demobilisation or setting back to the transfer of the Forces now being devoted to the purposes of destruction in. the defence of our liberties to the purposes of peace. It may be a trifling thing to suggest, but I think it would not be a bad thing if the word "demobilisation" was struck out of British dictionaries and the word "remobilisation" inserted. There are very unpleasant and unhappy recollections associated with the word "demobilisation." It is essential that we should get into our minds that there should be, with the least possible delay, reorganisation and remobilisation for the purposes of peace of all the forces which are now being devoted to the defence of liberty and humanity throughout the world.

I entirely agree with my right hon. Friend the Chancellor when he said, with reference to post-war financial problems, that the processes of Control of our financial and economic life must remain for a considerable time; in fact, I believe that if after the war our financial burdens are to be tolerable and capable of reasonable solution, we shall have to have for some time the same rationing of expenditure as we have at the present time. If we approach the matter in that way I think our financial burdens will be considerably lightened. I believe implicitly that there is not anything which the people of this country cannot do if they are prepared to pay the price for it, but after the war financial stability will involve our calling upon the people to make sacrifices and to make changes in their practices of the past.

I wish to reinforce what the Chancellor said about the necessity for saving. In my opinion, the war has been run far too much on a cash basis. We have been told that we are a magnificent people, that we make the most wonderful sacrifices, and that we are doing admirably in every respect. I should be the last to depreciate in any way the sorrows and sacrifices which have fallen upon nearly every family in the land, but when it comes to financial sacrifices, I do not think there is much in it. The great majority of the people have made no financial sacrifice whatever. The other day I was talking to a life-long friend of mine, a trade union leader of some distinction and standing, and he said that most of his men were thinking not of the war but of their pay packets. In so far as we have any financial difficulties in this country at the present time, in so far as there is insufficient saving, I believe it is due to the fact that there is still in the minds of many people an insufficient realisation of what is at stake in the war, and for that reason, although I have no criticism to make of the speech that was made by my right hon. Friend the Prime Minister, a speech in which he gave us a sound, factual and objective account of the war, I am inclined to regret that neither he nor anybody else in the Government has made a speech on the lines of the admirable war speeches that have been made on the other side of the Atlantic. That is an aspect of affairs which needs reinforcement in this country. Like other hon. Members, I have been in my constituency and, if I may refer to some observations that were made in an earlier discussion, I may say that far from having a desire to get away from Westminster, I look forward with relief to the prospect of coming back here. To spend 12 hours a day in the constituency, on the telephone from morning till night, is a prospect which, if other hon. Members like to be in their constituencies, leads me to suppose that their constituencies are different from mine, or that their contacts with their constituents are of a very different character from those which the majority of hon. Members enjoy.

But the point which I want to put to my right hon. Friend the Chancellor of the Exchequer is that wherever I go in my constituency and in the country, I am very much impressed by the enormous effort which the country has made. One sees now on sites which not so long ago were open fields, factories which are buzzing with life and industry, very often with women almost entirely engaged in them; but I did not meet anybody in any part of the country or in any factory who felt that the utmost effort was being made. There are still people who do not seem to realise what civilisation, not only our-selves but the whole of humanity, is up against. I find people in my constituency who say, "Why should I do so much, because the management are not doing all they might do?"—or this or that section of the workers are not doing all they might do, or the bus does not run, or something of that sort. People do not seem to realise that what is at stake is that there is in the world a vast physical force capable of destroying the whole of humanity, and that our task is to take that force out of the hands of the wicked men who are now controlling it. If we fail in that task, there is nothing left. We know that there is now no physical impossibility in building a fleet of aeroplanes of unlimited numbers which could go found the world carrying heavy loads of bombs; we know that some future Goering, if he were so minded, with such a fleet behind him, could say, "We will bomb Cape Town in the morning" and do it, or Montreal in the afternoon, and do that. The people of this country have not yet realised that fact.

Let me say that I put some blame upon the wireless. I do not think the public conscience responds to the wireless as it responds to the human voice and human personality. I remember some of the demonstrations which there were in the last war and the way in which people left those meetings with the determination of missionaries. People listen to the wire- less in the seclusion of their homes and can switch it on or off at will. I sincerely hope that steps will be taken to bring to people who do not yet realise them a realisation of the grim and stark facts of the situation, the horrors of the "new order" in the enslavement of Poland and the starvation in Greece. There is talk about sacrifices in this country; I saw some photographs of the streets of Athens where the pavements were littered with the dying and the dead, and on the same day in this country there was a dispute about the sweets ration, whether it should be three ounces or four ounces. I do not believe the mass of the people in this country yet realise the prospects before humanity unless all men and women bestir themselves. When there is this realisation, my right hon. Friend's difficulties with regard to savings will disappear and there will be a very different story to tell. There will be no need to placard the walls with fancy placards urging people to buy War Savings Certificates. People will realise that every transaction in life must be regarded not merely from the point of view of saving cash but of saving tonnage, and that nothing should be used by them which can be put to some use for war purposes.

I am glad that my right hon. Friend referred to the prospective transformation of post-war finance which has been brought about by the extraordinarily generous and statesmanlike proposals which had their origin in the United States of America and which, I think, are going to embrace all the other Allied Nations. It is probably true that by the Lease-Lend arrangements in their recent developments, based upon the valuable extension, which has been insufficiently realised, that was made in the important statement by President Roosevelt in June last, we do make it certain that, if we behave with reasonable generosity towards each other's point of view, and if there is a reasonable level of statesmanship, the cancer which gnawed at the heart of society as a result of the finance of the last war need not exist this time. This calls for consideration, and it calls for statesmanship. There are certain questions that can be asked, and if I mention one or two of them, it is not because I have views on them, but simply to make sure that they are borne in mind.

The question is From what date does Lend-Lease really begin? I do not think that has ever been decided. Was it in 1933, in 1935, or in 1939 that the battle for freedom began? Is war damage to be included? Surely all sacrifices ought to be included. On any and every occasion we have been prepared to blow everyone else's trumpet, but there is no use disguising the fact that in relation to our resources we have made a much bigger contribution than any other nation, except perhaps Germany in the early days. There is no use disguising the fact that we have made a bigger contribution to the war, and, if that is so, when the balance-sheet of Lend-Lease is cast at the end of the war, there is no reason to suppose that this country should come out a hopeless debtor, although some people seem to think that the prospect of heavy debts is perhaps the best inducement to make people do their best. I do not think that 75 out of 100 people in this country, when asked, could say what Lend-Lease really means. I am rather sorry that the Minister of Information is not present, because, if he were here, I should be tempted to prolong my speech and ask him what he is doing in respect of these very vital matters.

There is great scope for Parliament, for members of the Cabinet, if they can find time, and for all of us to take part in this process of education, which is urgently needed at the present time. In the meantime the country is looking to the day when the war is over, and expects that a different state of affairs will obtain after the war. Those who advocate a change and those who merely put up a negative proposition know we shall not return to our pre-war state. I heard that at a large meeting not very far from here a number of people passed, with great enthusiasm, a resolution to the effect that this war was not being fought to maintain the existing economic situation. That resolution would have had far more meaning and common sense if anyone had asserted the contrary. I have met many people and discussed the war with them, but I have not yet found anyone who asserted that the war was being fought to maintain the pre-war economic system. I have already allowed myself too long for an unprepared speech, but I feel that it is very important that the process of political education should be rapidly completed on these matters. Speeches in the same stratosphere as those recently made in America should be made in this country. We should support them because they are matters of very great consequence.

Do not let us think we can accomplish post-war reconstruction very easily. Let us beware in our desire for change, and let us not be led away by slogans. It has been said that the slogans which are most effective in appealing to the emotions make the least contribution to the solution of any practical problems on hand. Let us beware of slogans and wishful thinking. It is only by hard work and hard thought that we shall bring about that post-war reconstruction. One hears of people going about the country speaking from the text of the profit motive. One would gather from their utterances that the population of this country was a collection of crooks and swindlers, and that from the moment people get up in the morning to the moment they go back to bed at night they concentrate their energies and motives on swindling and doing down their fellow citizens. All sorts of assumptions are being made by false prophets and are being voiced at this time. What we need throughout the land is that there shall be a sense of social dedication in which all realise it is their duty and their honour to put more in the common pool than they draw out.

Photo of Dr William Thomas Dr William Thomas , Southampton

It is not my intention to keep the Committee very long. I believe we have reached the time when we may be in grave danger and we are rather inclined to dismiss too easily a matter which has some bearing on this Vote of Credit. I refer to inflation. To-day we have limitation and regulation of supplies, control of prices, rationing of food, rationing of clothes and so on, but the question of wages has been overlooked. I have referred to this question before, and I have already stated that until we have a policy of wage control the danger of inflation will be ever present. I should like to read a quotation to the House which seems to me to sum up the matter very well. Mr. Johnston wrote in the "Daily Telegraph," a paper not very antagonistic towards the Government, on 23rd July last: Wages enjoy to-day the unique distinction of being the only factor in the national economy which remain exempt from any form of Government regulation or interference. They are more sacrosanct even than persons. A man can be compelled to join the Armed Forces, or stay in his present job or go to another job, or to fire watch someone else's roof-top, but in the domain of wages, unless he is in the Armed Forces, private bargaining reigns as supreme as in an oriental bazaar. I think he might have added other matters to that excellent paragraph. So far we have got over our difficulties in another way. The Chancellor of the Exchequer has subsidised food in order to stabilise food prices. A short time ago the subsidy reached the tune of £100,000,000, and at present it is, I believe, in the region of £127,000,000. Very shortly it will, no doubt, be further increased, and other articles will be brought in. Since the war began the Chancellor has, by subsidy, maintained prices at a more or less even value, but wages have increased by hundreds of millions of pounds. I do not make these remarks because I am against high wages. On the contrary, hon. Members well know that I believe in a high standard of living for everyone. I am drawing attention again to this matter because constant increase of wages may have an inflationary effect which may lead to disaster for all, especially for the workers and the small rentiers who have worked hard all their lives and saved for their old age, thereby sparing the country the expense of keeping them, and old age pensioners. These may be the first to suffer. So let us remember that continual increases of wages will mean a greater subsidy, and eventually the Chancellor will be forced to increase prices themselves, with the resulting claim for higher wages. The climb up the vicious spiral will begin with all its disastrous consequences. That is why I am speaking like this.

Hundreds of millions have been given since the war began. At first there was a case for these extra wages. It was essential that they should be given because of the automatic rise in the cost of living, but it has gone beyond that now. There is, as it were, a scramble for money. During the last year the quantity of goods available for us all has steadily decreased, and the supply of goods is getting more limited, but some people are able to get a far greater proportion than they should, while there are many among us who are not able to get quite enough. I believe, if you include overtime and so on, wages between July last year and July this year increased by about £150,000,000, while the cost of living in the second half of that year, owing to subsidies and other factors, did not fluctuate by more than about a point. The Chancellor of the Exchequer well realises the difficulty, and the President of the United States realises it to the full. He announced the other day, far more fearlessly than the Chancellor dare announce in this country, that not only would he control prices but he would also control wages and that, if Congress would not give him the power, he would take it, with all the risks involved. He did that because he know perfectly well that, should inflation set in, not only would there be poverty, suffering and misery but there would be disintegration of the whole war effort. In fact at last it must lead to national disunity. I repeat, the Chancellor knows that perfectly well. He is probably of the same opinion as I am, but he has certain factors to face which make him rather timid in that direction. In July last year the Government brought out a White Paper on inflation. In 1940 the Deputy Prime Minister brought in the Emergency Powers Act, which definitely gave the Minister of Labour power to regulate wages. The Act itself says, "prescribe the terms of remuneration." The present Minister of Labour has taken no. steps in that direction. I believe he is perfectly sincere according to his philosophy of life. It may be running through his mind that wages should be high if possible and that now is the time to secure them.

We are at present a controlled country to a great degree, and we have been told over and over again that when the war is over control will not be immediately taken away. Perhaps it would be dangerous to remove it, but bit by bit it will have to be removed. No country in peace-time can live continuously under economic regulation and control unless it is a very impoverished country. When these controls are removed, prices will rise, and there will be considerable depreciation in the currency. The worker who comes home, his pocket bulging with wages, will find they will not purchase as much as he was told they would. This factor, with tax repayments and realisation of National Savings will depreciate the currency. I am not against high wages. I am saying this in order that the horrors of inflation shall not sweep over the people of the country. The Chancellor of the Exchequer in his last Budget took far too optimistic a view of the matter. He felt that we were past the danger, but I hold that he was hardly justified in taking that rosy view.

On Sunday night, by accident, I was unfortunately forced to listen to the broadcast. I could not help hearing with mixed feelings the noble effort of the small schoolboys who made up packets of small things, sold them for 1d. each, and sent the proceeds on to the Treasury. I could not help feeling sad when I heard that an old lady, I believe an old age pensioner, over 80 years of age, put her mite into what she called her Spitfire box in order to swell the coffers of the Treasury. I could not help thinking that perhaps on the Monday the Chancellor, so to speak, might be handing away millions of pounds in such a way as eventually to make it more and more difficult for that poor old lady to live. He gives largesse on the one hand and asks Lord Kindersley to gather it in on the other. Whatever action he takes, Lord Kindersley can only bring in a fraction of what the Chancellor gives away, sometimes unnecessarily, in extra wages. Great an impresario as Lord Kindersley is, he, even if he constantly puts on new turns, cannot always hope to fill his ringside seats. He cannot expect complete loyalty even from his most devoted fans.

There may be another side to this question. I cannot go into Excess Profits Duty or Surtax or Income Tax to-day, but the Government should consider very carefully whether there should not be a line above which dividends should not rise. There again you have to bear in mind that many of the shareholders in these companies are impoverished people who only hold a small quantity of shares, hard-earned savings, and are dependent on their dividends, so we have to examine it from that point of view. If it is needful for us to look at these points in order to prevent an inflationary condition, let us indeed do so. We are engaged now in the battle of fuel. We shall shortly be engaged in a battle against a far more cruel and ruthless enemy: that is the battle against inflation. Let us see that we do not unnecessarily engage in any further internal struggle, but preserve and maintain our strength and energies, completely and solely for the battle against the foreign foe.

Photo of Sir George Benson Sir George Benson , Chesterfield

I have no doubt that an admirable and logical case could be made out for a wages policy which puts a ceiling upon wages. I think that every Member on this side of the Committee would support such a policy if we lived in an equalitarian State. How-ever logical the argument may be and however dangerous to our price structure increases in wages may be, the people of this country will not accept a freezing of wages when there is a section of the community, small though it may be in numbers, which enjoys an incomparably higher standard of living. It may be bad economically, but there is a fact which cannot be burked. There is a small section of the community which, despite enormously high taxation and-limitations of profit by Excess Profits Tax and the like, lives in quite a different world economically from the vast bulk of the population. The case for the freezing of wages is destroyed morally by the fact that these people are allowed to utilise an enormously higher percentage of purchasing power than their numbers warrant. Until the inequality that exists in our social structure is dealt with we shall not get the bulk of the workers to accept a ceiling placed upon wages. I am not going into the argument whether an increase may produce inflation. [Interruption.] There is all the difference in the world between the President of the United States saying he is going to do something and succeeding in doing it. We in this House took powers over persons and property, but we have not used it yet. The case for the putting of a ceiling upon wages is ruined morally by the fact of the vast inequalities in our social organisation. Get rid of the inequalities and I believe that we on this side will agree that the standard of consumption, which is the real factor, shall be put at what the country can afford, providing it applies to everybody. That is not what I rose primarily to talk about.

On an earlier Vote of Credit I raised the problem of the efficiency of the Savings organisation and gave a number of facts to show that Lord Kindersley's Committee was run in an extremely slip-, shod and inefficient manner. Lord Kindersley replied next day in the Press that he was quite prepared to be judged by results. I am not certain that results are always a very accurate gauge of efficiency, but as Lord Kindersley has chosen that ground upon which to be judged let Us look at what the results of the Savings organisation has been during the past six months. The Chancellor made some attempt to defend the Savings organisation. He praised it and made some comparisons which I could not follow. He also made some comparisons in a speech at a Savings meeting last night when he compared the savings now with the savings pre-war, as if there were any comparison between them. Our small savings, to which I am referring, are not increasing at the rate at which they ought to do. The figures show that conclusively. If we compare the first six months of this year with the first six months of last, we find that the savings have grown from £341,000,000 to £352,000,000—a bare increase of £11,000,000 in the six months. The whole of that increase was due almost entirely to the fact that the London Warships Week produced about £25,000,000 more than the London War Weapons week of the previous year. In the rest of the country there has actually been a decline in the first six months of this year as compared with the first six months of last year, in the receipts of small savings. In the last two months the decline is distinctly marked. In June, 1941 small savings amounted to £51,000,000. In June this year they amounted to £41,000,000. In July last year they were £44,000,000, and in July this year £43,000,000. I have not the August figures, but in the first seven months of this year we are not holding our own in small savings.

I do not need to stress the importance of savings. Taxation, whatever it may be theoretically, has practically got towards the limit of yield. The big savings are largely automatic and limited. The real corner stone of our financial solvency is the return of small savings. Despite the fact that we are now in the fourth year of war, there is no evidence that the Savings Movement has been put upon an efficient basis. The figures I have given for last year and this year are perhaps not quite comparable. I do not want to score any debating points, because this is a serious matter. Factors which have altered must be taken into consideration. The first is the big increase in the taxation on wages under last year's Budget. It is estimated that something like £120,000,000 will be taken from weekly wages in Income Tax. That is not a net increase. A certain amount was taken last year, and I am unable to give the actual figures, but about £60,000,000 has been collected in the first six months.

The other is that there has been a very considerable growth in the national income in the past twelve months. The Chancellor, referring to the growth in the national income, suggested that it was nothing like as large as many people thought. He was dealing with real income, but when we are dealing with savings and the sources from which savings can come we are dealing with the cash income and not with real income, and there has been a very considerable growth in the national cash income in the past twelve months. That growth has not shown itself in an increase in the amount of savings. The source from which the savings can come is far larger, but only approximately the same amount of savings are coming as came last year. That is definitely an indication that the efficiency of the savings machinery has not increased as it ought. I do not think there is any other Department of State organisation, productive or administrative, in which there has not been a steady, a phenomenal, increase in general efficiency. The one exception is the Savings Movement. Judged by results, it is lagging seriously behind. The Savings Movement controls the amount of savings we get, and, as I have said, savings are the linchpin of our financial position. The trouble is that the National Savings Movement is still run by the people who ran it before the war, with Lord Kindersley at their head, and they run it as if it were a kind of glorified thrift club. Their method of approach is very largely by appeals on the hoardings. We spend £1,250,000 each year in advertising. Roughly one-third of the whole expenditure of the Government upon advertising is spent by the National Savings Movement, but I do not know whether any hon. Member in this Committee could quote off hand the wording of any savings advertisement. Frankly, one has become so satiated with them, so accustomed to them, that they have now no appeal.

If we are to put the National Savings Movement on an efficient basis it must be done not by appealing from the hoardings but by a tightening up of the organisation in the country. Only last week I was told by a man who is employed full time in the National Savings Movement in the country—I will not name the town, it is a large industrial city—"We are only now beginning to collect data in our town which will give us some indication as to where are our weak spots and where are our strong spots." That after three years of war. If we are to make our savings keep pace with the growth of national income it is certain that we must introduce far more efficiency into the National Savings Movement. Last time I spoke on this subject I gave many details of incompetence and inefficiency on the part of the head office in London. I do not propose to go over that ground again, but in view of the importance of the subject I suggest that the Chancellor should not be satisfied with what is being done. He should not be satisfied to quote savings in 1938, a pre-war year, and say they are now four times as large as they were then. He should appoint a small committee of investigation, he should acquaint himself with the shortcomings of the machinery itself, and should realise that if our national income is growing steadily year by year there ought to be an equally steady increase in the returns from our National Savings Movement. Until that is done the danger of inflation which the hon. Member for Southampton (Dr. Thomas) referred is not very far round the corner.

Photo of Mr Frederick Cocks Mr Frederick Cocks , Broxtowe

As the Chancellor of the Exchequer is not here, I hope that he will forgive me if I do not follow him into the realms of finance, because, unfortified as I am by Treasury advice, I know almost as little about the subject as he does—very little more, at any rate. In fact, if I were ever offered that high post, I think I should be in the position of the late Lord Randolph Churchill who, when he was shown some decimal figures, wanted to know what those qualified dots meant. I will pass from the late Lord Randolph Churchill to his even more illustrious son, who spoke yesterday, and I am sure that I am voicing the feelings of the Committee when I say how pleased we were to see that he had returned from his adventurous journey to Russia and the Middle East in such good health and such high spirits. We quite agree with him that that journey was worth the expense, because it enabled him anyhow to partake in the Kremlin of an austerity meal of 24 courses without having to use any of his food coupons; and I am sure, too, that in that anything but Barmecide banquet he stoutly upheld the credit of the British race.

But I want to go on to a subject which has been discussed for the last two years, ever since Russia came into the war, and that is the idea which many people have had that it would be a great short-cut to victory and would shorten the period of the war if, while the Germans were engaged in Russia, we were to land a large army in Europe. The Prime Minister referred yesterday to large-scale operations for which preparations are being made. There I am content to leave the matter. It is obvious that before victory is achieved a large Continental invasion must take place. The time and place of that invasion must surely be left to those who control our strategy and have accurate knowledge of our military resources. I have never myself taken part in this agitation for a second front, and I was certainly strongly opposed last autumn to the idea that we should land then a large army upon the coast of France and risk, possibly, a second Dunkirk. I have taken the line from the very first day of this war that it was going to be a very long war indeed. When some hon. Members were suggesting that the war might be over by Christmas I wrote upon my Order Paper the following observation and passed it round: "Do you realise that the war against the French Republic and Napoleon lasted for 21 years and I should not be surprised if this one lasted a third of that time and that before the end the whole world will be engaged in it? "I have always taken the view that we should be prepared for a seven years' war, even if it actually lasts less than that time. Therefore, I feel that it is our duty to be patient until the full military resources of America and of ourselves are fully developed and employed, and I agree with General de Gaulle when he said: It is perhaps the action of 100,000 tanks combined with that of 100,000 planes, and provided with supplies by 50,000,000 tons of shipping, which will win once and for all the victory of liberty. My main criticism of the present Government is that they did not make up their minds early in this conflict whether the war would be a long one or a short one, and consequently did not draw up a strategic plan to conform to one or other of those ideas. From observations which the Prime Minister has let fall I believe he has always been of the opinion that it would be a long war, but as far as we can see he has not pursued a consistent military plan conforming to that theory, because it is obvious that the strategy and weapons for a long war must be different from those which have to be employed in a short war.

Let me take an example. If the war is to be a long one, it is obviously necessary, for the first few years, that we should fight defensive battles, in the main, until the material for victory arrives. That means that the armies and navies engaged should be provided with the special weapons they need in order to hold the defensive line. We all know and agree that the intensive bombing of Germany by heavy, long-range bombers is an indispensable preliminary to a successful invasion, but if that invasion is to be delayed until the fourth, fifth, or perhaps the sixth year of the war, it is not necessary that priority in construction should be given to those weapons in the first year or two of the war. The first essential, if it is to be a long war, is, in these first years, to build the weapons which are necessary for Army and Navy co-operation and to construct not only fighting planes for the defence of England, but the special types needed by the Army and Navy—torpedo-carrying aircraft, assault planes, dive-bombers, troop-carrying planes and what are sometimes called tank-busters, light and medium bombers which do not require so many man-hours to construct as the heavy Stirlings and Lancasters which, upon this theory, could be started a little later in the campaign. Had we, in the very beginning, made up our minds that it was to be a long war and had concentrated on those particular weapons, we might not have lost Malaya, Burma and Libya or the warships which have been sunk because they were provided with insufficient air defence.

I think the same mistake was made by the Government of not consistently conforming to the strategy of a long war—that is, if they have made up their minds that it is to be a long war—in relation to what was, in my view, that most disastrous expedition to Greece. I think that was the greatest single mistake of the war. It lost us the command of the Mediterranean. It also lost us Libya and Cyrenaica and imperilled Egypt. It prevented reinforcements being sent to the Far East which might have saved Burma, even if they could not have saved Singapore. Moreover, that expedition was undertaken in flat defiance of two of the chief maxims of military strategy laid down by Napoleon and other eminent military commanders. The first of those maxims is that when the enemy is on the run you must keep him on the run, even if, by so doing, you stretch your own force to the very limit of endurance. So it was that after the battle of Jena, when Napoleon ordered Murat's cavalry to pursue the defeated enemy right to the walls of Berlin and thus won the whole campaign instead of merely a single battle.

I do not know what the condition of our troops was when they reached Benghazi in that first onset, but I do know that the Italians thought we were going to push on to Tripoli and were negotiating with Vichy at that time to see whether Vichy would agree that their trooops might retreat through Tunis. I know also that Admiral Cunningham, commanding in the Mediterranean, said that at that moment the opening of the Mediterranean route was well-nigh an accomplished fact. It was obvious that, with shore-based aircraft all along the North African coast from Egypt to Tripoli, we should have commanded the Mediterranean, which would have been a British sea and General Rommel would have been an absolute impossibility.

The second maxim to which I refer, of Napoleon and other commanders, was that you should concentrate your forces upon a single objective and never divide them into two weak detachments in the face of the enemy. To take two Divisions from General Wavell's victorious Army and send them, with a very few aeroplanes, to a hopeless campaign in Greece was a fatal decision. We lost many men and all their equipment, and many ships, and we did not save Greece. We met with disaster in Libya from the consequences of which we have not yet recovered. What we should have done was to have sent our transports to Greece. We should have told the Greek Government at that time to remember that many of their great victories in ancient times were won not on the mainland of Greece but in Africa and Asia. Cyrenaica was a Spartan colony, and Alexandria was founded by Alexander the Great. Moreover the Greeks evacuated Athens after Thermopylae. We should have said that we were ready to evacuate from the mainland of Greece as many divisions as possible of the undefeated and gallant Greek Army, take them intact with all their arms and equipment to fight by our side in Asia and Africa. I believe that would have been a wise thing to do. It would have been a fine political and strategical conception. It would have been in accord with the long-war strategy. The consequences of not doing so we see in the Middle East to-day.

However, all that is in the past. We have now to concentrate on the present and the future. We have the big bombers here, and they are coming in increasing numbers. They are doing magnificent work in bombing Germany and, I understand, in protecting the Atlantic trade routes. The workshops of Britain and America are now pouring out munitions of war on an ever more immense scale. American troops are now flooding into this country in preparation for the great day when the command will be given to invade Europe. In the Pacific, the Japanese have recently suffered severe defeats on the sea at the hands of our American Allies. Great naval battles have been fought without the fleets ever being within 300 miles of each other. In Egypt, Rommel has suffered a severe rebuff. The Armies of General Alexander and General Montgomery appear, from what we hear, to be strongly equipped and in excellent spirits. I think we ought to congratulate the Prime Minister upon the decision to make those painful but necessary changes in the High Command which he did. Some of us think that he ought to make similar changes at home. We can say that the war prospects seem to be, to us anyhow, decidedly brighter than they were two months ago when the last Debate took place on Foreign Affairs.

Still, in spite of the brighter atmosphere of the present time, we are faced by great perils and great dangers, and we must be prepared to face them. In the first place, if Stalingrad falls—but it may not fall—Germany may press on to the Caspian Sea and into Persia and Iraq, and cut off Russia from Allied help altogether. They might even strike at India from the West at the same time as Japan is striking from the East. Secondly, unless we destroy General Rommel's army, and destroy it quickly, our Eighth Army, although better equipped than it ever has been, will be at a very great disadvantage, seeing that it draws its supplies over a very long route all round the Cape of Good Hope, whereas, if Germany managed to drive back the Russian armies across the Volga and hold them there with far fewer troops than are now engaged "in the attack, they would have many more troops to spare and could reinforce Rommel far more rapidly than our troops could be reinforced. Our position might then be almost hopeless. Not quite hopeless, because I feel that if that happened we should only have one thing to do, and that would be to shorten our supply line to Egypt by driving through the western end of the Mediterranean by methods which I will not indicate further in this House to-day.

Meanwhile, U-boats continue to levy their heavy toll. If it is true, as we have read in the papers—including a rather important article in "The Times" a few days ago—that there has been a complete change-over in German war production from heavy weapons like tanks and heavy guns to a lighter type of war material, it means that next year the numbers of U-boats will be greatly increased and that we in this Island will be subjected to formidable and varied attacks from the Continent. For those evils we must be prepared, and those evils in the end we shall surely overcome. In the meantime, I should like to ask my hon. Friends and others who are engaged in pressing for a second front to practice the hard but very necessary military virtue of patience. Endurance is the crowning quality, and patience all the passion of great hearts. When Hannibal invaded Italy, Quintus Fabius Maximus pursued a policy of patience, but the people of Rome became restless and demanded- instant action. They got their way, and the result was the carnage of Cannæ, the greatest defeat the Romans ever had. After that the Fabian policy was resumed. It was unspectacular, but it saved Rome. To-day, in this Island, we and our Allies are fighting for the whole future of mankind. We dare not risk that future by premature action. Let us patiently build up our strength and await the decisive hour and then, when the right moment comes, let us strike with all our strength and all our power and win the decisive victory.

Photo of Mr Aneurin Bevan Mr Aneurin Bevan , Ebbw Vale

It was regrettable that the Debate collapsed at so early an hour yesterday, but I and some of my hon. Friends accept no responsibility for that fact. Indeed, I shall take the unusual course of quoting from a Whip. Our Whip says: After the Motions of condolence on the death of the Duke of Kent, the Committee stage of a further Vote of Credit will be taken, and the Prime Minister will make a statement on the war situation. The remainder of Tuesday and Wednesday will then be devoted to a Debate on the war situation. It was felt that Front Bench speeches might monopolise the whole of Tuesday, therefore it has been decided to give another day. So, if the Debate yesterday came to so untimely an end, part of the responsibility must rest upon those who have the presumption to call themselves Front Benchers. The rest of the responsibility for the early collapse of the Debate must, of course, rest with the Prime Minister himself, because his speech was unable to compete in attractiveness with the House of Commons meals, and everybody here knows what that means. If the Prime Minister will insist, on these occasions, on indulging in these turgid, wordy, dull, prosaic and almost invariably empty new chapters in his book, then he must expect something like what happened yesterday. Most of what he said could have been said in 20 minutes, and would probably have been enormously improved had that been the case. We do not therefore apologise for the fact that the Debate collapsed at so early an hour. It is also very regrettable that so much of the time has been taken up in discussing financial matters, which it seems to me could have been discussed at some other time. Anyhow, I shall take advantage of the opportunity to say one or two forthright things about the Prime Minister I have already given him notice that I propose to say them, but, of course, I understand that it might not be possible for him to be present.

The Prime Minister, in the opening phases of his speech, enjoyed himself a great deal by referring to the Debate on the Vote of Censure, and the House of Commons enjoyed it too. The Prime Minister's sense of humour has recovered itself since then, because at the time he did not regard it as humorous at all. He was very angry, so angry that he was unable to make a reply. But the Prime Minister—and I am very sorry that he is not here, because I intend to say one or two things about him which might appear to hon. Members to be too direct—invited the representatives of the Press to meet him the day before we had our Secret Session on shipping. I understand from my informants, and I have checked this on several occasions from different people who were present, that the Prime Minister was dressed in some uniform of some sort or other. I wish he would recognise that he is the civilian head of a civilian Government, and not go parading around in ridiculous uniforms. It would be very much more dignified if he just went around in ordinary fustian. He addressed these 50 or 60 representatives of the Press and told them everything which we were told the following day in Secret Session. About that I do not make too much complaint, except that it is a very difficult situation for hon. Members of this House if the secrets which are reposed in us are shared by so very many people over whom we have no direct control. I should not be answered in this matter if it were suggested that the Prime Minister was following the example of President Roosevelt, because President Roosevelt does not sit in the Senate or in the House of Representatives. Therefore, when he has to speak to the world he must use a Press Conference through which to do it.

But the Prime Minister is a Member of the House of Commons, and if he has anything to say, he should say it here and not make use of secret meetings of that sort. But he did far more than that. That is why I refer to the fact that he has now recovered his sense of humour, because at this meeting, using the language of my informant, he railed at the representatives of the Press for giving his critics so much space in the newspapers. I want the House of Commons to realise the seriousness of this. Here is a Prime Minister who is the leader of a political party, the head of a National Government. That Prime Minister and that Government have enormous powers over the Press which they have used on several occasions. That Prime Minister, armed with those powers, meets the representatives of the Press and accuses them of giving his critics, who are Members in the House of Commons, too much space in the Press. I say that this amounts to political intimidation without any precedent in the history of this country and is evidence of the increasing paranoia of the Prime Minister's psychology for which the docility of the House of Commons is responsible. The time has come when we should make this man realise that the House of Commons is his master, and that he must not abuse the patience and tolerance and good will of the House in the way in which he has been doing it. I am very sorry, as I have already said, that he is not here, but I ask the House of Commons to agree with me when I say that it is irregular, to say the least of it, for a Prime Minister to try to use his authority in order to prevent his critics from having any public notice.

Having said that, I would like to make one or two general observations on the Prime Minister's speech. The Prime Minister took a great deal of justifiable pleasure in the fact that the military situation in Libya turned out to be less calamitous than we feared it might be. We are all very glad indeed that the Army was able to make its stand and prevent the onrush of Rommel against Alexandria and Cairo, but the Prime Minister must recognise that the absence of continued disaster is not itself a victory. We have been so accustomed in this country to a series of disasters that if we are not having any we become quite pleased with the situation, and there has descended upon the country an air of complacency because for the moment we are not suffering any serious reverses. I am bound to speak frankly in this matter. I do not understand the Prime Minister's references to the recent engagement in Egypt. He represented, because of course it made his case stronger, that Rommel had launched a full-scale offensive and had been beaten back. If that is true, all my military friends are now asking, "When the counter-offensive?" If Rommel attacked in a full-scale offensive and has been beaten back with remarkably small losses on our side, where is the counter-attack? The fact of the matter is—and the Prime Minister ought to use restrained language in this matter—Rommel made a reconnaissance in force. If he did not make a reconnaissance in force, if he made a full-scale attack, then there is still something wrong in Egypt. But I do not accept that. I accept that our military dispositions have been wisely handled, and Rommel in his feeling-out sortie found the position far too strong for an immediate attempt.

It is when we turn to the general aspects of the war that I am frightened. I hear my friends speaking here of the mounting production of America and of Great Britain, and how in a year or two this will reach a tornado and we shall be so overwhelmingly strong that the enemy can be easily defeated I wish hon. Members would take a more objective view of the situation than that. Germany is getting at her disposal an economic apparatus which, if she is left in undisturbed possession of it, will more than equal the production capacity of America and Great Britain combined. It is childish nonsense to think that America has unlimited production capacity. We know now, as a matter of fact, and our own Ministers have told us, that American war production is even now less than our own, and America is running into very considerable difficulties in increasing her production. This idea that we have this terrific reserve which will enable us to overwhelm the enemy is the reverse of the facts. If you take the whole of Germany with a population of 90,000,000 to 100,000,000, and take the economic and technical apparatus of Czechoslovakia, Poland, Belgium, France, and now European Russia, of Hungary and Rumania, of Italy, and add all these together, it is an economic potential at least equal to that of Britain and America combined going all out, and it is time that these facts were faced in this House. We are having far too much rhetoric from the Prime Minister and not sufficient cold reasoning about this matter.

I will give one or two other examples just now of this. It therefore seems to me that my hon. Friend the Member for Broxtowe (Mr. Cocks) has got it all wrong. This sitting back looking at a long war frightens me because I do not see that if the war gets longer and the territory under German control gets larger our position is necessarily made better. Cannot we have a short war if we want one? Are we bound to have a long war? It seems to me that this preoccupation with the idea of a long war was indulged in with almost sadistic satisfaction by the hon. Member. I would like to have a short war. It seems to me that we have had some of our best opportunities for bringing this war to an early conclusion, and the longer it goes on the more menacing the picture might become. I do hot believe in the efficacy of long-term bombing as even a principal weapon with which to win the war. I see no reason at all, I have found no reason at all, why the German population should be more ready to succumb to night bombing than the British public. Whatever may be said about the German people, they are a brave people, and the German people are not going to be any more terrorised than the British people, were, and if, when the long nights begin, we are to have reprisal bombing on both sides, we must always realise that the target area in Great Britain is more accessible and easier to get at and smaller than the similar target area in Germany. Furthermore, this idea of sending out thousands of bombers every night to bomb Germany just will not work. It is an impracticable proposition to send out so many bombers night after night from British aerodromes; and everyone who has looked into the problem carefully knows that to be true. That, too, belongs to the realm of rhetoric. Long-distance bombers are very useful, and now that we have them we should use them; but I wish we had employed our resources in producing a much more useful weapon than that.

I do not think that the prospects opened up by the Prime Minister's speech are as favourable as many people believe. Why are we in this position? Why is it that the strategy of the war as devised by the Prime Minister has brought us to this pass? At the end of three years of war, at the end of three years of mobilising the resources of the British Empire, the Prime Minister and his Government manage to preoccupy the attention of 150,000 Germans and Italians in Egypt. That is our contribution. We have so disposed our forces, so mobilised our resources, that all the enemy has to do is to set aside 150,000 troops to engage us. [An HON. MEMBER: "What about the Japanese?"] I am speaking for the moment about the European theatre of war; if you are going to bring in the Japanese, we have to consider the United States as well. The fact is that all that Germany has to do at this moment is to separate from her mass 150,000 troops. That is our contribution to beating Germany this year. I will reverse the picture. All that Germany has to do is to use 150,000 men in order to immobilise 1,000,000 British soldiers, who have been for over two years in the Middle East. The hon. and gallant Member for Preston (Captain R. Churchill) perhaps wants to interrupt.

Photo of Mr Randolph Churchill Mr Randolph Churchill , Preston

I would get up if I wanted to.

Photo of Mr Aneurin Bevan Mr Aneurin Bevan , Ebbw Vale

The fact is that our resources have been handled with such wisdom that Hitler and Mussolini between them use 150,000 troops in Egypt, and we have troops—with those in Syria and those in Persia—numbering according to the Prime Minister's own statement, 750,000 at that time, though the number is probably nearer 1,000,000 to-day. I know that some of them have been sent elsewhere, but there have been replenishments. This is the way we have been using our striking power in the third year of the war. So ineffective has our war organisation been that the Italians can afford to send more troops to Russia than they have in Egypt. There are practically two Italian Armies fighting on the Russian front. We have not even been able to prevent Italy from reinforcing her Russian armies. The Prime Minister talked yesterday about these nations being dragged reluctantly into the war machine by Hitler. The fact is that Hungary and Rumania are not fighting reluctantly: they are allies of Hitler; and Hitler is luckier in his allies than Stalin is in his. Hitler's allies are fighting, Stalin's are not. [An HON. MEMBER: "Are they not?"] No. I am using direct language; I do not like this business of using ambiguous words in the House of Commons.

We had in December of last year the longest possible notice that any nation could have of a major war event. The whole world knew that this spring and this summer the German army was going to be locked in conflict on the Russian front. War is full of unpredictable facts, but that was a predictable one. The Government had nine months' notice to make their preparations. The Prime Minister constantly tells the House of Commons, "I cannot give the facts; otherwise, the enemy would know." The Prime Minister has a Phillips Oppenheim complex. But Hitler told us in December last year that this year he was going to try to wipe out the Russians. I want to know from the Prime Minister and the Government what military preparations this Government took to deal with that fact. It is now the beginning of the autumn of 1942. What I say is not merely the opinion of a private back bench Member in this House; it has been the opinion of some Members of this Government, because the Leader of the House of Commons some months ago used language about a second front which led the country to believe that we were going to have it this year. [An HON. MEMBER: "The Prime Minister did so, too."] Yes, the Prime Minister did so, and the Foreign Secretary, Here we have Stalingrad beseiged, and almost fallen, with 45 German divisions in the West. I say that this year, fought with imagination and courage, the Germans could have been beaten. The reason why the Germans have not been beaten is that the Government have not the guts to do it.

The people of this country want to know, in what circumstances does the Prime Minister envisage the defeat of Germany if it is not possible for us at this time to deal with 45 German divisions in the West? The people are going on from week to week because they really believe that the Government are going to do it. If you go to any provincial town in this country you will find that the ordinary working-class people believe that it is the intention of this Government to launch a second front in Europe. If that is not done, and if Stalingrad falls and the Russians are driven behind the Urals the working-class people of this country will be asking why. It will be no use for the Prime Minister to tell them that military considerations make it impossible, because, unfortunately for the Prime Minister, British people have more confidence in the sagacity of Voroshilov and Timo-shenko than in that of Winston Churchill, and they know that the Russian Generals have declared that a second front is a practical military proposition, and has been for the last year. They will say, "What is the inhibiting factor?" The conclusion has been already reached by millions of working people in this country that one of the reasons why we have been unable to assist the Russian people militarily, after 15 months of war, is that the British Government feel what the former Minister of Aircraft Production said, that they would rather see the Germans and the Russians weakened by mutual conflict. I am not saying that that is in the British Government's mind, but that is what has been said in- many parts of this country, and all over the world, and it will be said more and more if autumn gives place to winter and no second front is launched by this country.

I do not know what military intentions the Government have, but the Prime Minister hinted yesterday that military plans of some magnitude were under discussion. I cannot consider them, and obviously no one here can. We have to await the unfolding of events to see what the Prime Minister had in his mind. But there is one thing that we must face frankly. We are entering the fourth winter of the war, and we are going to enter it, unless we are very careful, in a spiritually debilitated condition.

Photo of Mr Randolph Churchill Mr Randolph Churchill , Preston

Let the hon. Member speak for himself.

Photo of Mr Aneurin Bevan Mr Aneurin Bevan , Ebbw Vale

I would not venture to try to speak for the hon. and gallant Member, or I might have an unwarranted reputation for wisdom. The fact is that we are entering the fourth winter of war, and I am envisaging and making the assumption that the second European front will not have been opened, and I am asking the Committee to consider what will be the spiritual reaction in Great Britain to that situation. It is no use for hon. Members to say that everything will be all right. Everything will not be all right. It can be made all right, but we must recognise that a change in Government also is necessary if our people are to sustain the fourth winter of war with the same courage and buoyancy as they did the first, second and third winters.

What must be done? We must enter the fourth winter of war by a declaration of political purposes which puts our declarations on a level with those of American statesmen. There is deep disappointment in the United States of America that no British statesman has seen fit to respond to the remarkable series of speeches made by Mr. Sumner Welles, by Mr. Wallace, the Vice-President, and by the President himself. But there is a very great deal of disappointment in America and, of course, here too. I was disappointed yesterday that the Prime Minister did not take advantage of the occasion to respond in the way that he ought to have done. Why is that? Why is he unable to do so? Is it because he is not only Prime Minister but the leader of the Conservative party? Is it impos- sible for him to speak the nation's voice at this time and give moral leadership to the world because he is preoccupied as the Conservative leader? If he is to respond to what American statesmen have said and the way they have said it, he will have to overthrow a good many of his friends sitting behind him on the benches opposite. We have had no such declarations. Remember this, as the winter draws on and rationing is necessarily extended, higher earnings are no longer providing the incentive they did. If men cannot spend their money in the shops, there is not the same inducement to earn the wages in the workshops, and, therefore, if the incentive for earning fails some other incentive must take its place. We know, speaking from the mining areas.

I have warned the House for the last two and a half years. I have told the House that there will not be a single additional ounce of coal produced under the Government's coal scheme. Coal output is falling. We are going to be faced this winter with a very acute coal shortage indeed. Our war production might suffer grievously as a result of the shortage of coal. We are not responsible for this. We have been telling the Government this for two and a half years, but the Prime Minister has such a desire to push people into uniform, even when he has nothing for them to do. He pushed 80,000 miners into uniform and kept them there browning off. The unemployment of the British Army in the last two years in this country is one of the major scandals of the war. Hitler did not do it. Even with a war on the Russian front, he brought many of his men home and put them into the factories. The hon. Gentleman opposite shakes his head, but he does not know the facts. We found it impossible to bring men home from camps a few miles away and put them to work producing coal. Is this the sensible way in which to manage our resources? Now we are engaged in the battle for fuel, and in a vast economy campaign, and there will be great suffering as a result of the shortage of coal this winter, all because the Prime Minister is absolutely ignorant of the elementary facts of industrial life. Otherwise he would have put these men into the pits and built up his coal stocks at" the time when he could not use them as soldiers, and then, when he wanted them as soldiers, he could have taken them out of the pits, and the coal stocks would have been there to be used. At the present time, owing to the Prime Minister's unrealistic attitude to the war on its major strategical side and to the economic organisation of the country's life, it is no use the Prime Minister saying that he is not responsible for it, because he accepted direct responsibility to this House for the refusal to send miners back to the pits. If there is a shortage of coal this winter, the main responsibility will be that of the Prime Minister.

I do not want to delay the Committee any further on these matters, but I seriously suggest that if we are to refurnish the spirit of our people this autumn and winter, new leadership is required. I do not conceal from the Committee that the Prime Minister's continuation in office is a major national disaster. He is no longer able to summon the spirit of the British people, because he represents policies that they deeply distrust, and it is no use for men in the Trades Union Congress to make adulatory speeches about the Prime Minister, because these speeches do not represent the feelings of men in the workshops. Men in the workshops are waiting anxiously for Great Britain, on the field of battle, to come to the state of her responsibility and waiting, in the spiritual and intellectual fields for this country to give the leadership for which the world is waiting. It gets nothing from the Prime Minister. It neither gets courageous disposal of our material and physical forces, nor does it get intellectual and spiritual inspiration. It gets nothing but nostalgia over ancient battles and old ways that are dead.

Photo of Mr John Wardlaw-Milne Mr John Wardlaw-Milne , Kidderminster

I would like to deal with some of the matters which have been raised by the hon. Gentleman the Member for Ebbw Vale (Mr. Bevan), but first of all to say a few words regarding the speech of the right hon. Gentleman the Chancellor of the Exchequer and this Vote before the Committee. When the hon. Gentleman the Member for Broxtowe (Mr. Cocks) gave us these very interesting and historical references a few minutes ago, I was a little horrified at what he envisaged to be the length of the war. I expect that we all felt that if he was right and the war was going on for another three or four years, it was rather awful to contemplate that throughout that period we would have to vote at intervals further thousand millions of money for the purposes of carrying on the struggle. My right hon. Friend spoke to-day of the dangers of inflation, and I think that this House has on previous occasions dealt fairly fully with that subject. I do not agree with him that no inflation has taken place. I do not suggest that he made that definite statement to-day, but I believe that it is the view of the Government. There has been a certain measure of inflation already, but I have paid tribute before to the measures the Government have taken to limit it as much as possible. Let us be quite clear, however, how they are doing it. It is mainly by payments of £130,000,000 or thereabouts in the form of subsidies, which, of course, are a direct charge on the taxpayer. I do not know whether it is possible for my right hon. Friend to avoid further inflation unless he is prepared to contemplate a very much wider extension of subsidies than has taken place at the present time. I understand it is possible that I may get figures from the Financial Secretary at the end of the Debate showing how much money we are raising from savings, but even——

Photo of Mr Douglas Clifton Brown Mr Douglas Clifton Brown , Hexham

I must warn the hon. Member that the question of raising money is certainly out of Order on Supply.

Photo of Mr John Wardlaw-Milne Mr John Wardlaw-Milne , Kidderminster

I bow to your Ruling, Colonel Clifton Brown. I was merely referring to a statement made by the Chancellor, but as I understand these figures will be supplied before the Debate closes, I will not deal further with them at the present time. However, I want to raise this one matter on the question of expenditure. It is perfectly clear that our heaviest expenditure in this country, naturally and rightly, is on wages. They are the heaviest charge in this war effort, and it has to be remembered that the Government at the beginning of the war made it perfectly clear that nobody was to make money out of it. I am not prepared to say that, necessarily, people have made money out of the war, but it is quite clear to everybody that it is impossible for the Government to carry on on the basis they indicated without a definite wages and prices policy. If you are to restrict prices, you must restrict wages. Wages which are raised as a consequence of an increase in the cost of living are perfectly justified, and I further say nothing about wages being increased where, formerly, they were too low, but where there is no ceiling in wages and there is a definite ceiling in prices it is obvious that any Government will get into serious financial difficulties.

The Government realised this when they issued a White Paper some six months ago in which they stated the dangers which lay ahead of the country. But that White Paper contained nothing but a lot of copybook maxims. The Government did not indicate the measures which they themselves felt it necessary to enforce, and to-day we are faced with the fact of not merely greatly increased wages, but, what is far worse, the gross inequality of wages—the giving of high wages to people who have had no long training, whereas men and women who have spent many years in industry are getting smaller returns. That is doing more harm than anything else in this country at the present time, and it is something the Government must tackle. Otherwise they are heading for financial destruction. I would remind the Committee of what was stated by the Deputy Prime Minister in the early part of the war, when he said, in effect, that the whole of the services of the people of this country were to be put at the disposal of the Government. That has never been brought into operation at all. The one thing which has been allowed to be free of Government control is the regulation of wages and the negotiations between employers and employed with regard to them. I have no objection at all to high wages, what I do object to most strongly, is the idea that a man like a miner or an agricultural worker, who has spent many years in his industry, should be able to earn only £3 or £4 a week while somebody who knows nothing about industry and is beginning work for the first time should get far more money. That is a situation that cannot continue. It is high time that the Government came out with a wages and prices policy so that we know where we are.

What the Government are doing—and I warn them of it—is creating a vested interest in the minds of some people in the carrying-on of the war. That is an extremely dangerous situation. I am not speaking against the patriotism of the people; everybody in the country, with one or two exceptions perhaps, wants to win the war, and I do not suggest for a moment that people in our factories are not working splendidly, because they are. But that does not alter the fact that there is being created in the minds of some the sort of idea that "We are doing pretty well now. We know what we had before. We may have to go back to something like that." It is bad that that sort of interest should be created. This point was so well and eloquently stated by my hon. Friend the Member for Southampton (Dr. Russell Thomas) that I need not refer to it further. But there is a further matter. Not only is a wages and prices policy required, but it is necessary that the Government should give the people of this country some lead as to our plans for the future. A great many people are afraid of what may happen in a future after the war, and it is clear that the Government must give the country some lead as to their plans, how they intend to do away with unemployment—as they can—and raise the standard of life of the people of this country. I wish it were possible to go into these subjects in detail to-day, but it would not be in Order to do so. We must do away with fear of the future, and we must make it clear that we will not allow any financial interest, such as that which exercised power after the last war, to prevent our moving towards prosperity—because we can get prosperity—and we must make consumption in the future, not production, the basis of our own and world prosperity. The people of the country want to know how the Government plan these things and how they will deal with them and with other problems so that we may remove the fear of the future.

Now I wish to refer to the speech which the Prime Minister made yesterday. The hon. Gentleman the Member for Ebbw Vale said that the Prime Minister had on more than one occasion referred to the Debate and the decision of the House on 2nd July. I was a little surprised that my right hon. Friend' should have found it necessary to have referred to it no fewer than three times. Evidently he was extremely gratified and somewhat surprised at the result. I can only tell him that I do not think the result surprised any of those who signed the Motion for the Vote of No Confidence. The result was what we expected. I was struck by the fact that he was somewhat surprised at it, and as I began to wonder why, I was reminded of the speeches made in that two days' Debate. I wonder whether the Prime Minister, during his long and arduous journey to the Middle East and Moscow—which the House is grateful to him for undertaking—had time to read the speeches of the various back benchers of both sides of the House in that Debate? If he did so, he must have been struck by one thing, namely, that with the exception, perhaps of two speeches, every speaker, apart from members of the Government itself, began by saying he intended to resist the Motion "but"—. That word "but" was immediately followed by some complaint about the Government's policy. If my right hon. Friend had read the speeches carefully, he would have seen, I think, the justice of that rather witty remark which appeared in one newspaper at the time, namely, that the result of the Debate showed a great deal of vote but very little confidence.

Now let me come to what the Prime Minister said yesterday. When he was discussing the situation in Egypt, he told us— Before I left I had some reason to believe that the condition of the Desert Army and the troops in Egypt was not entirely satisfactory."—[OFFICIAL REPORT, 8th September, 1942; col. 87, Vol. 383.] Presumably that knowledge came to the Prime Minister between the time he spoke on 2nd July and the time he left on his journey, for certainly there was no indication of it in his speech in this House. On that occasion, I was certainly left with the idea, as I feel sure other Members were, that the Prime Minister was very satisfied with the situation in Egypt. It is true he agreed that we had not tanks of a calibre and strength to stand up against some of the German tanks, and we have not got them still, but it will be noticed that in his speech on 2nd July he said: We had a superiority in the numbers of tanks—I am coming to the question of quality later—of perhaps seven to five. We had a superiority in artillery of nearly eight to five. Later on, he said: I am only concerned to give the facts to the House, and it is for the House to decide whether these facts result from the faulty central direction of the war."—[OFFICIAL REPORT, 2nd July, 1942; cols. 592 and 594, Vol. 381.] Throughout that speech apart from the remark concerning tanks, the im- pression given was that our troops m Egypt were properly equipped and able to stand up against the Germans, and that the Prime Minister could not, as they could not, understand why they had been pressed back. What is the position as seen from the speech which the Prime Minister made yesterday? Apparently, out of 100,000 troops, we lost 80,000—an amazing disaster. When the Prime Minister went to Egypt he found that conditions were such as to make it necessary for him to make drastic changes. If ever there was necessity for a vindication for the putting down of the Motion of no confidence on 2nd July, it rests in the speech which the Prime Minister made yesterday. It is quite unnecessary to go further than that speech to find every reason for the Motion of no confidence which was put down on 2nd July, and I am only hopeful that the majority which the Prime Minister got on that occasion did strengthen him to go to Egypt and make very necessary changes in the High Command and in the supply of equipment. I have no desire to make a long speech now. Frankly, I think it is a pity for the Prime Minister to take umbrage, as undoubtedly he did, at the placing on the Order Paper of a Motion which drew to his attention, in a way in which it is perfectly clear it had not ever been brought to his attention before, a situation which was highly dangerous and which only the measures that he subsequently took has enabled us to overcome.

The Prime Minister gave us yesterday a statement not optimistic, but certainly of a more encouraging character than we had had before, but I noticed that when he spoke of what was going to happen in Egypt—I do not complain in the least about what he said, and I hope to goodness it is true—when he spoke of what he expected of our Army in Egypt, a sort of shudder went through the Committee, as much as to say, "Are we again going to begin saying too much?" Do let us stop boasting about what we are going to do and let us do something. The House and the country are tired of statements about what we are going to do. I firmly believe that Rommel's move against us has been for him, if not a disaster, at any rate a very serious setback. I hope that we are going to get steadily improving news, but I agree with the hon. Member opposite that when we look at what we have done—I am not complaining, because I know the difficulties of the position as well as anybody—as compared with what others have suffered and are trying to do, I do not think we are in any position to boast. We are in a position in which we should have very humble minds, but look forward, as we are entitled to do, to the much greater share we shall take in the future. The difficulties of production, of which the hon. Member spoke, are only too true. And it would be a great mistake if we were to depend too much upon what America can do, great as her effort will be. As I have said so often, it is here that we are going to win the war; it is in the production of this country. That is why I began my speech by making statements concerning the situation of those in the factories. It is on them that the outcome will largely depend. Is the House doing everything to bring to the people of this country a real realisation of their personal responsibility in the matter——

Photo of Mr John Wardlaw-Milne Mr John Wardlaw-Milne , Kidderminster

—and how much depends on each one of them?

Photo of Mr John Wardlaw-Milne Mr John Wardlaw-Milne , Kidderminster

The hon. Members may think they know all right, but take care, for if there is the slightest spirit of tranquillity and over-confidence in the minds of the people, we inevitably lose production. Let it be remembered that we are not asking people to make a normal effort; we are asking them to make an abnormal effort. It is difficult enough to do that for a few weeks or months, but when we go on asking for it year after year it becomes a tremendous strain. That is what we are asking people to undergo. Therefore, it is necessary to buoy them up with some fair and reasonable—not exaggerated—picture of the future, of what we are aiming at in the future, of what we believe is possible in the future; to give them some idea that they will not go back to the old conditions and that there will be a better future in the world, that they can make it, we can make it, all can make it; that it depends not only on Government action—whoever may form the Government—but upon the individual work and responsibility of every man and woman in the country. Do not let us think we will secure full co-operation merely as long as we deal with questions of wage-earning. After all, at the present time every wage-earner is paying Income Tax and is just as much interested as the rest of us in seeing that the money is not wasted. But we must get rid of the fear of the future by pointing out clearly that we will not allow vested interests of the past and not allow any of the old ideas to stand in the way of that better world which we can all secure if we work and build together.

Photo of Mr Richard Stokes Mr Richard Stokes , Ipswich

I want to take the Committee back to the opening remarks of the very able speech made by my hon. Friend the Member for Ebbw Vale (Mr. Bevan), a speech with which, except for some of my hon. Friend's strategical efforts, I am in complete agreement. My hon. Friend, when commenting on the deplorable fact that the Debate yesterday collapsed at a premature hour, said that the Prime Minister really had himself to blame on account of the nature of the speech he made. I entirely endorse that view. I thought it was the worst speech I had ever heard from the Prime Minister, and I thought it illustrative of what really is his inner feeling and his complete disregard of and contempt for this House of Commons. If I may make reference to the book which in these speeches he is writing for publication when the war is over, I can only say that it seems to me that that speech will be one of its more deplorable chapters.

After much Press boosting, which I suppose was inspired from official quarters, of a great Debate to which, apparently, all serving officers had been summoned to attend to hear great military revelations and the rest of it, I expected to hear some comprehensive review of what had been going on since we last met. I can only say, on examining the speech, that we were given what I may call only the leavings. What was served out to us? First of all, there was the Malta convoy, a terrific action for those taking part, but while we were told what the Naval losses were, no indication was given of the very serious merchant shipping losses which we incurred at the same time. The Prime Minister then went on to describe the Dieppe affair as a great crowning success. Having experienced something of the kind myself in the last war, I would not wish for a moment to belittle the gallantry of all those who took part in the raid, but I feel bound to say that those who went on the raid do not perhaps quite share the view of the Prime Minister.

Then we had a review of the progress made in overcoming the U-boats. I well recollect some 18 months ago making a speech in this House in which I referred to the possibility of the sinkings of merchant shipping amount to 6,000,000 tons a year. I was laughed at, but we all know now that the sinkings during the past few months have been considerably above that figure. What surprised me was that the Prime Minister first told us that practically every day a U-boat went down or was damaged, and in the next breath said that U-boat sinkings were not keeping pace with new construction. I am not as well informed as the Prime Minister or the First Lord of the Admiralty on these subjects, but I always understood that the rate of U-boat building was of the order of five or six a week. Therefore, if the first statement is correct the second is incorrect, and vice versa. Then we came to Libya. It does seem a pity that the Prime Minister, when telling us what our losses had been, did not give some indication of the comparatively small number of enemy troops engaged. When speaking of Libya the Prime Minister jeered at those of us who spoke in the Vote of Censure Debate, and said that we, or some of us, seemed to think that the fall of Cairo and Alexandria was only a matter of days. But I would refer the Committee to what the Prime Minister himself said in that Debate. He stated: Rommel has advanced nearly 400 miles through the desert, and is now approaching the fertile Delta of the Nile.…We are at this moment in the presence of a recession of our hopes and prospects in the Middle East and in the Mediterranean unequalled since the fall of France."—[OFFICIAL REPORT, 2nd July, 1942; cols. 584–5, Vol. 381.] I do not see what the House was to understand from that, except it was highly probable that the enemy might reach Alexandria and Cairo. Then he went on to tell us that we might now hope, as a result of reinforcements which had been sent, to continue to hold Egypt, at least for some few months. That sent a shiver down my spine, and I could but reflect that I wish my right hon. Friend—if I may speak of him so, and if he does not dislike my calling him so—would remember the advice which, I believe, was given to him by that great man "Jackie" Fisher—"For Heaven's sake, when you make speeches do not make prophecies, because they are always followed by disasters." I also expected that we should have some more information about the Moscow visit. What were we told? From the Prime Minister's remarks I gather that things did not go too well. Apparently he was away for nearly a month, spending only four days in Moscow, and the rest of the time, apparently, playing at soldiers in the desert. In fact, the only sign of hope I got out of the Prime Minister's speech was his sudden recognition that we are sea animals, that the Russians are land animals and that the Americans are ocean animals—at least I was grateful for that. At last I hope he has got his mind away from the Marlburian idea of mud and blood generalship. I have not much time to follow further a speech which seems to me to be entirely inadequate, but I should like to refer to one other remark. He stated yesterday: We are indeed entitled, nay, bound, to be thankful for the inestimable and measureless improvements in our position which have marked the last two years."—[OFFICIAL REPORT, 8th September, 1942; cols. 95–6, Vol. 383.] I record that in the course of that time we have lost an Empire and control of the sea. Why I should feel reassured by the results of his leadership in that period, I fail altogether to understand.

Now I want to say something on more general lines. This matter has been touched upon by the hon. Member for Ebbw Vale and also by the hon. Member for Kidderminster (Sir J. Wardlaw-Milne). I and some of my friends on this side of the Committee have been pressing for a very long time for an answer to the question, "What are we fighting for?" We all know perfectly well what we are fighting against, but there has been and there still is a sad lack of moral and spiritual leadership in the country, and the want of this is, to a very large extent, causing the feeling of frustration which exists among a great number of people. We all know perfectly well the effects in the workshops when Russia was dragged into the war. We all know that our comrades and friends in the shops felt that here was something they could really support. I cannot help reflecting, if something dreadful were to happen, and there was an unfortunate collapse in Russia, on what the Government have to offer the people of this country in place of that to make them continue, nay, intensify their efforts as they will need to do to bring the war to a successful conclusion. It is perfectly true that we have had the Atlantic Charter. I suppose that one day we shall hear how it was conceived and born. Someone told me the story and it did not impress me. It is not a very satisfactory document. It is particularly unsatisfactory when you realise that 350,000,000 members of the British Empire in India have been told that it does not apply to them. When one thinks of some of the provisions of Article 4, one asks whether that means that the Minister of Production, when the war is over, is to return to his control of the tin monopoly, and whether the Minister of Supply will once more engage in the power monopolies he controlled prior to the war. Then we have the old idiocy in Article 8—the idea of unilateral disarmament.

While the Atlantic Charter may have been a good thing with which to start, surely to goodness our Government are capable of following the lead, as my hon. Friend the Member for Ebbw Vale said, of our American friends across the water, and proclaiming to the peoples of the world something much more constructive and something worth fighting for. By and large, we are a Christian country. We have Christian ideals; but we hear little but paganism from the Government and from their propaganda. There is a revival going on now which, if taken in hand, hitched and properly led, could bring us all to the point we wish to reach, and that is a state of things where we can all live in peace with one another. But we can only achieve that end if we summon all those people in foreign territories as well as our own who hold the same Christian beliefs, give them cause to overthrow the tyrant which exists whether in this country or elsewere, and show them that we have something better to offer than anything they can ever get under a totalitarian regime.

Photo of Mr George Griffiths Mr George Griffiths , Hemsworth

In following the last three speakers I recall the proverb "Fools rush in where angels fear to tread." I feel I am a bit of a fool to rush in here at this time, but I have only a few moments, and I wish to give my impression of yesterday's proceedings I have heard the Prime Minister speak many times during the last nine years. I have heard him speaking in opposition to his own Government on the Indian question, and I heard him when he was warning the House about Germany, Hitler and war. I felt that yesterday the Prime Minister was somewhat uneasy. He seemed uncomfortable. He did not rise to the occasion as Members and the Press seemed to expect before the Debate took place. When I saw 30 or 40 of his own followers leave their seats before he had finished, to go for something to eat, I felt that that was a direct insult to him. I am not going to condemn the Prime Minister as he has been condemned by the three last speakers. When my hon. Friend the Member for Ebbw Vale (Mr. Bevan) with his intelligence, his force and his destructive speeches—and no one can be more destructive than he can—puts his point across the Floor he makes the House believe that practically everyone is against the right hon. Gentleman. No one fought the right hon. Gentleman more than I did before he became Prime Minister, but I feel that this is our Government. We belong to it as much as the Tories do, and we shall not help the Government along if we preach destruction all along the line.

Photo of Mr Aneurin Bevan Mr Aneurin Bevan , Ebbw Vale

What does my hon. Friend mean by destructive speeches? Is a critical speech necessarily a destructive speech? I have made very many suggestions, but the Government always regards suggestions as being destructive from the beginning.

Photo of Mr George Griffiths Mr George Griffiths , Hemsworth

My hon. Friend's speeches against the Prime Minister have always been vitriolic. He cannot get up without damning the right hon. Gentleman. That is how I regard it, and I have as much right to express my opinion as my hon. Friend has to express his. Now I want to leave that point and refer to the Tory Members who are all the time pinpricking the miners, though they know nothing about the job. Some of our men are not throwing their full weight into it, and it is necessary that the Leader of the House and the Prime Minister should know this. I was at my branch 10 days ago and the men had 64 wage grievances at that branch alone. Some of them had existed since 6th July, and it was 24th August before the management met the men, and not all the grievances were settled then, though they were bread and butter grievances. These men are not in the second front or the third front. They are in the first front. We cannot win the war without coal. I am asking the Government to say to these managements, "If you cannot manage the firm better than this we will clear you out of the way." It has got to be done. [Interruption.] It is not the Prime Minister alone. It is the Government. I feel that the Government should know these things. It is no good to bring out a White Paper and tell our people that it is the best thing that the miners have had up to now, if this is the result when the White Paper comes to be worked. Some of these men went home as much as £8 short—and it was a legitimate payment put in on piece rates for work in abnormal places. I will say no more. I am wound up and wanted to go further, but I will sit down and let the clock strike.

Photo of Captain Harry Crookshank Captain Harry Crookshank , Gainsborough

Everyone who has been listening to the Debate for the last two or three hours must have been very interested at what has been said, on wider issues of course than the purely financial, and must have recognised that once again hon. Members have expressed themselves most freely and vigorously upon subjects in which they are interested. Certainly the hon. Member for Ebbw Vale (Mr. Bevan) cannot complain at the very patient hearing that he received. His words were rather sadly heard by a good many Members who do not share his view about the Prime Minister and his advisers, but that is all part of the democratic way in which we carry on our business. It is not for anyone except myself to complain, in this sense, that there are in the present hierarchy three grades of Ministers—Cabinet Ministers, Ministers of Cabinet rank and the "also-rans." When one of the junior Ministers has to wind up a Debate of this character it is, unfortunately, not in accordance with custom for him to answer the point, as he would like, by spreading his wings and really taking on some of the last speeches which have been made. That is what I should dearly like to do, but instead I will answer one or two of the financial points which have been put to me.

The right hon. Gentleman who opened the Debate, when he enlarged his speech into dealing with some of the wider ques- tions, dealt with the position of women and said that, while they had already been given great opportunities in the war, they also required more recognition for their efforts, and he instanced what he thought was a grievance about the post-war credit as between husband and wife. I think there was a misunderstanding somewhere, but I should like to put it on record that in the OFFICIAL REPORT of 9th June, col. 921, my right hon. Friend gave an answer on this point to the hon. Member for West Fulham (Dr. Summerskill) and told her that in Section 7 (2) of the Finance Act, 1941, it is provided that, where a wife has an income of her own, the postwar credit, which in the first instance is lumped together, may be divided if either husband or wife applies for such a division.

I do not think anybody could say, therefore, that that was a source of grievance, as the right is given to the husband or wife to have the division made. There was a question by the hon. Member for Maryhill (Mr. Davidson), in an interruption when my right hon. Friend was speaking, as to what was the present trend of interest-free loans which were coming to the Treasury. These loans, which we have been so happy to receive during the war, tend to fluctuate very considerably. I do not know what the reason is. It may be due to the generous impulses of particular people at a particular moment, or it may be that some folk have accumulated a certain sum at a particular time and think that when it has reached a certain figure that is the moment to make such a loan. The receipts during August, if they are any help to my hon. Friend, are much the same as they were last year. The curve of these things shows that when we have special efforts such as Warship or War Weapons Weeks the tendency is for the amount to increase. That is largely, no doubt, due to the spirit of local patriotism that is engendered by these special efforts.

Mr. Davidson:

I do not suppose that the right hon. and gallant Gentleman can indicate the main sources of such loans?

Photo of Captain Harry Crookshank Captain Harry Crookshank , Gainsborough

I could not possibly, and I am not sure whether the information is available. The hon. Member for Camlachie (Mr. Stephen), referring to a figure given by my right hon. Friend of £4,200,000,000 coming in from small savings, asked where the difference between the figure of small savings and the figure of total borrowings came from. A written answer is being circulated in the OFFICIAL REPORT to-morrow on that point. The short answer is that the rest of the borrowings comes from a whole variety of sources, such as Treasury Bills, Treasury Deposit Receipts, surplus balances of Government Funds, Tax Reserve Certificates, which, incidentally, have been very largely taken up since they were introduced, and so on. The actual details have been asked for and are available in the answer.

Photo of Sir George Benson Sir George Benson , Chesterfield

The right hon. and gallant Gentleman referred to £4,200,000,000 as coming from small savings. He is surely referring to large investments and not small savings, which amount to between £1,500,000,000 and £2,000,000,000.

Photo of Captain Harry Crookshank Captain Harry Crookshank , Gainsborough

I put the figure down as the hon. Gentleman asked the Question, and very likely I have the wrong figure. Seeing, the hon. Member for Chesterfield (Mr. Benson) there, leads me to answer one of his points. He was once again critical of the Savings Movement and its organisation. I did not realise he was going to raise that issue to-day, so I have not the details which I might like to put to the Committee on that subject. It is not true to say that there have been no changes in the organisation or that certain up-to-date methods have not been added in the way of propaganda and publicity. As a matter of fact, they employ some able publicists and no doubt take the advice which is tendered to them by those who know best how to bring these matters to the public. I have no doubt that the posters and the various little things we see in the Press are all part of that campaign.

When the hon. Gentleman, in seeking to denigrate the Savings organisation, throws doubt, as I think he did, perhaps unintentionally upon the present effects of the Savings Campaign, I would remind him of a sentence in the speech which my right hon. Friend made to-day in which he said that all the evidence about the small savings was that they were improving in quality. I daresay some hon. Members may have thought, "What on earth can the Chancellor be referring to in using the word 'quality' in that sense?" The point is that the whole drive of the Savings Movement lately has been towards forming Savings Groups, and that there is an increase in the number of groups in factories and the like, and that the figures show that we are getting a very considerable increase week by week in the issue of Savings Certificates of small denominations, that is to say, certificates of from one to five units inclusive. Over the first eight months of this year, as compared with the first eight months of last year, there has been an increase of 34 per cent. in the Savings Certificates of from one to five units denomination, and that is what was meant when the word "quality" was used, because the whole object has been to try and get as much as possible of the savings of small people, apart from the savings of those who buy perhaps 50 or 100 certificates when they can afford it and still have some savings left. That is why there is considerable ground for satisfaction with the increase in that group of savings during the first eight months of this year.

Then the hon. Member for Kidderminster (Sir J. Wardlaw-Milne) asked me what percentage of war finance came out of small savings. The answer, as he will see if he analyses the various figures which my right hon. Friend gave in his speech, is that somewhere about 22 per cent. of our war borrowings have come from that source, and that would represent roughly, over the whole period, something like one-eighth of our total expenditure.

Photo of Mr John Wardlaw-Milne Mr John Wardlaw-Milne , Kidderminster

I did not say "small savings." I said savings of all kinds.

Photo of Captain Harry Crookshank Captain Harry Crookshank , Gainsborough

I certainly wrote down "small savings." I think the other figure was in my right hon. Friend's speech, where he said that of the £12,100,000,000 which is total expenditure during the war, some 40 per cent. has been raised by taxation.

Photo of Captain Harry Crookshank Captain Harry Crookshank , Gainsborough

The hon. Member may make such deductions as he can from that.

Photo of Mr John Wardlaw-Milne Mr John Wardlaw-Milne , Kidderminster

I am afraid one cannot deduce it from that.

Photo of Captain Harry Crookshank Captain Harry Crookshank , Gainsborough

If the hon. Gentleman wants the figures, perhaps he will put down a Question, because I do not like to make statements ex cathedra. I thought he referred to small savings, but I am sorry if I got it wrong. The only other question which I have time to answer was put by my hon. Friend the Member for Stone (Sir J. Lamb), who made an interjection asking whether Lend-Lease applies to raw materials. In reply to that, I would say that the Lend-Lease from the United State to us does cover a large volume of raw materials. The United States pay in dollars for their requirements of raw materials from the British Empire, though we in this country supply the United States Forces here with such raw materials, coal, for example, as they need as reciprocal aid. In the United States Press the statement has been made that this method did- enable Great Britain to continue to pay dollars for its purchases in the United States apart from Lend-Lease supplies. The total of British Empire cash purchases since September, 1939, amounts to about 7,000,000,000 dollars, a great deal more than the total United States Lend-Lease deliveries so far. I think I have answered within the short limits of time available the more important questions which were put, and I hope now that the Committee will be good enough to let us have this stage of this Vote of Credit, which is one more step towards winning the war.

Question put, and agreed to.

Resolved, That a Supplementary sum, not exceeding £1,000,000,000, be granted to His Majesty, towards defraying the expenses which may be incurred during the year ending on the 31st day of March 1943, for general Navy, Army and Air services and supplies in so far as specific provision is not made therefor by Parliament; for securing the public safety, the defence of the realm, the maintenance of public order and the efficient prosecution of the war; for maintaining supplies and services essential to the life of the community; and generally for all expenses, beyond those provided for in the ordinary Grants of Parliament, arising out of the existence of a state of war.

Resolution to be reported upon the next Sitting Day; Committee to sit again upon the next Sitting Day.