Amendment of Law

Part of Orders of the Day — Ways and Means – in the House of Commons at 12:00 am on 16th April 1947.

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Photo of Sir Waldron Smithers Sir Waldron Smithers , Orpington 12:00 am, 16th April 1947

Throughout this Debate the speeches have taken a course which would seem to imply that we are living in normal times instead of being face to face with the biggest crisis in history. All sorts of details have been discussed, but I do not propose to go into much detail tonight. I want to talk about some of the big principles under which our economic and financial life exist. If a home, or a Government, or a country applies sound principles, the results will, inevitably, be successful. The opposite is also true. I say that the principles which inspire the policy of this Government are evil principles and must ultimately bring disaster.

My main reaction to the Budget speech of the Chancellor can be summed up in two points, the first being internal and the second external. Internally, he has juggled with figures and he has got a so-called balanced Budget, but the external position, as he acknowledged in his speech, is still desperate. I would refer the Committee to Table 14 in the Financial Statement. I ask the Committee and the Financial Secretary whether any recognised firm of chartered accountants would be able to sign that statement as a true and correct statement of the Budget prospects for the country for this year. The last item under Estimated Revenue "Miscellaneous" is shown as £270 million. I think the Chancellor has got that by pawning the pram and the piano, and calling it revenue. On the other side, there is an estimated surplus of about the same amount. It seems to me that this is altogether fake bookkeeping and that we are taking as revenue what should have been used as capital or used to pay off debt. Taking the right-hand side, I want to call attention to the figures of the total of the Civil Estimates of £1,698 million. Last year the total of the Civil Estimates was £2,090 million, but in the Budget speech of the Chancellor he referred to the Ministry of Supply which has a civil element also.''— OFFICIAL REPORT, 15th April, 1947; Vol. 436, c. 41.] And the Ministry of Supply is down for £100,300,000 this year. Would the Financial Secretary tell us how much of the civil expenditure of this year is hidden in the civil element in the Supply Estimates to which the Chancellor referred? It would be interesting to know that. In view of the fact that he has announced larger expenditure on some of the social services, I want to see why the Civil Estimates have been reduced from £2,090 million last year, to £1,698 million this year.

I beg hon. Members on all sides of the Committee, in all their financial and economic thinking, to remember that England is different from nearly every other country in the world. To live, we have to import one-half to two-thirds of our food and raw material. We have lost, in the cause of freedom, the great bulk of our overseas investments—over half of them—and we have to export goods and services at world competitive prices or starve. In his speech the Chancellor referred to the necessity for an export drive. Other Ministers have referred to that, up and down the country, and I would beg of them to add to their plea "at world competitive prices." Britain must face the fact that she is different from every other country in the world. We have, as I say, to import from one-half to two-thirds of our food and raw materials. To import, we have to export at world competitive prices, instead of stifling the twin incentives to hard work—fear of loss and the hope of gain. That is a hard thing to say, but it is true and it is human nature.

We had a long Debate the other day on Command Paper 7046. I will not discuss that now but the Command Paper on the "Economic Survey for 1947" was 32 pages of wishful thinking. Britain was not built on a five-day 40-hour week, and she cannot continue to exist on a five-day 40-hour week. I give way to no one in my desire to help the whole community, the workers especially, but the workers of this country have to face the fact that unless we work just as hard as is necessary to export at world competitive prices, we are faced with starvation. The suppression of free enterprise has caused the worst failure in administration known in our history. The cost of production, including the expenditure on social services, the reduction in output per manhour, the shorter hours worked, the higher wages demanded and granted, must increase our cost of production and must, therefore, impede or destroy our ability to compete in the markets of the world.

In the economic life of a country there are three processes—production, manufacture and distribution. State interference and State control represent a mortal danger to all those three, but are most dangerous to distribution, because in distribution there is more detail, and you must leave it to the man on the spot to decide how this or that should be distributed or conveyed, and that interference with the economy of distribution is the main reason—I have this on the highest authority, from a Member of the Government; I will not give his name for it would not be fair—for the fuel crisis the month before last.

An interesting point about the Economic White Paper—I am told this by a big industrialist who is connected with a large range of industries, and I wish the Government would take note of this—that already Cmd. Paper 7046 is out of date. The three or four weeks' stoppage, the three or four weeks necessary to get back into production, the output per man hour being down by 30 per cent., have resulted in the fact that already the production programme for 1947 is down by 20 per cent. I hope the Government will look into those figures and warn the Departments and the people if, as I believe, they are correct. The President of the Board of Trade speaking at Bristol to the Trade Union Labour and Co-operative Guilds is reported in the "Sunday Times" of 30th March as saying: Britain may have to borrow £350,000,000 abroad this-year to meet our export deficit. That is a terrible thing to be said by one of the leading villains in the piece. Who is to lend us £350 million more with the already enormous debts around our neck? Then he is reported to have said: I have done my damnedest to get the Soviet Union to do a deal on industry of any kind, particularly in timber, but they are not able to. Consequently, we have to buy from across the Atlantic and spend dollars. The Soviet Government is fooling him as it is trying to fool other Ministers

I said I would try to talk about basic principles, which affect this country and the world and which affect the success or failure of this Budget. The root cause of the troubles of the world today is the poison of Communism. [Laughter.] It is no good the hon. Member for West Fife (Mr. Gallacher) laughing. I have some information to give the Committee which I think will surprise hon. Members. I would direct the attention of the Committee to the three articles in the "Daily Telegraph" of the last three days by the right hon. Gentleman the Leader of the Opposition. The war is not over. The war between good and evil is still raging, although the guns have stopped and bombs have ceased to fall.

In support of my remarks, may I draw the attention of hon. Members to some books which I beg them to read? There is one called "Nationalisation—Chaos or Cure" written by the hon. Member for Canterbury (Mr. Baker White). It is a remarkable thing that the United States Chamber of Commerce, a non-political body, has published two pamphlets lately called "Communist Infiltration into the United States" and "Communists Within the Government." There is another book, by Mr. Cronin, called "The Menace of Communism." Then there is "The Great Globe Itself," by Mr. Bullitt and "I Chose Freedom" by Kravchenko. If hon. Members will read those books, they will find that what I am about to say is completely justified. Communist power is increasing all over the world. One man in America can call out 400,000 miners—he is even stronger than the Government. One man can call out 300,000 telephone workers—