Orders of the Day — Re-Armament

– in the House of Commons at 12:00 am on 23rd July 1951.

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3.40 p.m.

Photo of Mr Robert Hudson Mr Robert Hudson , Southport

I beg to move, That this House takes note of the Third Report from the Select Committee on Estimates. The country is faced today with a rearmament problem. That problem is bound to make demands on our national resources of manpower, plant and raw materials. It is obviously of prime importance to our economy that those demands should be met with the greatest economy of our resources consistent with carrying out the policy implicit in the programme. Those were the considerations present in the minds of the members of the Estimates Committee and to that end, as they state, they made a sample survey and have, as I believe, made some extremely valuable suggestions.

The Estimates Committee are a nonparty body. I suggest, therefore, that broadly speaking the discussion of their Report today might well partake, subject to the limitations of human nature, of a non-party character. Let me make one other point clear also. The country has before it two re-armament programmes: one put forward by the Government, involving an expenditure of £4,700 million—of which I believe about half is to be spent on physical equipment—the other being that of the right hon. Gentleman the Member for Ebbw Vale (Mr. Bevan) and his friends involving an unknown figure, but one which, if we we are to believe them, is substantially less.

I leave the discussion of which is adequate to the party opposite. I only venture to suggest, in passing, that it is extremely fortunate that the right hon. Member for Ebbw Vale and his co-writers of that pamphlet did not have to submit themselves to the cross-examination of the members of the Estimates Committee; otherwise, I feel perfectly certain that the application of the word "twaddle," which I believe was used by the First Lord of the Admiralty in regard to one of their lucubrations, might have been shown to have been well founded.

The Conservative Party are responsible for neither of these programmes. As far as the programme of the Government is concerned, we were not consulted and we have no means of knowing whether it is adequate or not. The details which we believe to be necessary to form such a judgment have not been published. And statements such as that of Lord Alexander in another place last week, that contracts have already been placed for a sum of £900 million sterling, add little, if any, light to the subject.

Nevertheless, re-armament there must be. Even the right hon. Member for Ebbw Vale and his friends agree to that —with one exception. Re-armament is bound to have an effect on the structure of our economic life and we believe it is essential that, whatever the level of re-armament, steps must be taken to see that its impact shall be as small as possible on our economy consistent with carrying out the basic policy. I hope we shall have the agreement of all parts of the House on this. That is the angle from which we on this side of the House will approach the debate today. I hope, therefore, that hon. Members opposite will not waste the time of the House by producing the usual old red herring of Conservatives being warmongers.

I believe that carelessly handled rearmament may well result in an uncontrolled rise in the cost of living. Handled carefully—and I do not under-estimate the difficulties of the problem—I believe that its effect can definitely be kept under control. Let me repeat again, therefore, that I am dealing today with the means of carrying out the programme, whatever that programme may be, and not with its absolute size.

Turning to the report itself, the first thing that must strike any impartial reader of the report and, more especially, of the evidence, is the contrast between the apparent complacency of the civil servants who have to place the orders and the evident anxiety of the industrialists who will be responsible for putting those orders into effect and for providing the equipment. No doubt the Committee were impressed by this, as everyone else must be, for they stressed the need for the various contractors to be given a full picture of the demands that will be made upon them so that their plans may be soundly and economically prepared.

I should have thought that was obviously sound doctrine, but there are undoubtedly many industrialists in the country who doubt whether effect is being given to that recommendation. Indeed, on all sides there are fears that there is not sufficient sense of urgency on the part of the authorities concerned.

Armament production, like any other kind of production, depends on three factors: labour, plant and raw materials. The Report deals with all three and makes valuable recommendations in respect of them. However, as we had a debate only the other day on raw materials, on the setting up of the new Ministry, in order to save time I propose, Sir, with your permission, to confine my remarks to the other two factors, namely, labour and plant. The Committee suggest, and I agree, that the problem is how to get more of each factor, labour and plant; how to divert existing factors from present use to re-armament; and how to get more production out of each. I will deal with each of those in turn.

First labour. There seems to be a general belief that the demands which the re-armament programme set by the Government will make on the labour position of this country are very great. It is as well, I think, at the commencement of the debate, to try to get this into perspective. A short while ago, in a lecture, the Permanent Secretary to the Ministry of Labour stated that there were then no less than 850,000 fewer persons engaged in manufacturing equipment today than there were in 1939. The figure today is, I believe, 750,000.

At present there are approximately 600,000 men employed in munitions and by 1954 an additional 500,000 will be required, making a total of approximately just over one million. The Minister will correct me if I am wrong; but even in 1954, when just over a million will be employed, that figure will still be 250,000 less than were employed in munitions in 1939. That gives a measure of the size of the re-armament impact on our labour position.

It has also to be remembered that, although there will be 250,000 fewer on munitions than in 1939, the total of our population at work has in the interval increased by three million. Of that number, local and central government, apart from the industrial workers, employ an additional three-quarters of a million compared with 1939—enough, in fact, to man up the entire re-armament programme today. The Forces occupy another quarter of a million, building has 50,000 more producing somewhat less than they did, basic industries are up by 220,000 and agriculture by 180,000. There are also one million fewer unemployed. That makes up three million extra men at work.

The problem which faces the country is where to find the additional 500,000 persons who will be required between now and 1954. It could be done in one of several ways, or by a combination of them. It could be done by increasing the total of our working population—for example, by getting more women into munitions. It could be done by keeping more people in work over the age of 60 or 65. It could be done by an increase in the number of people in productive work—for example, cutting down the number of those who are engaged merely in form filling.

Lest there be any doubt about the size of that margin, it is well to remember that in the production census of 1946 the proportion of administrative, technical and clerical staffs employed in those industries which were the subject of the census had risen from 12· 9 per cent, to 15· 7 per cent. Obviously there is a considerable margin of slack which could be taken up.

Apart from any of these, or possibly as supplementary to them, the transfer of only 6 per cent. of the persons at present engaged in the whole of our manufacturing industries would suffice to provide the whole of the additional manpower required. I want hon. Members to bear that figure in mind, if they will be so kind, because the real size of our labour problem is shown in it—6 per cent. of the total manpower engaged today in the manufacturing industries.

Clearly the withdrawal of that amount, although not very large, would necessarily create a gap in our industrial production, especially in our production for export and for domestic consumption—unless the gap can be filled. About how it can be filled I hope to say a few words later, but clearly there are advantages in taking that 6 per cent. from manufacturing industries because the task of training them for their new jobs will obviously be much easier than if we are to take a corresponding number of raw recruits. In any event, from the point of view of mere size, I suggest that the problem is easily manageable.

I turn next to plant—machine tools. The Committee stated that machine tools form the key to the whole problem. They state—and I was surprised to learn it, and I am sure most hon. Members and the country will be surprised to learn it—that there are more machine tools in the United Kingdom today than ever before in our history; but in their Report the Committee state that these machine tools are not being used to the best advantage because of the absence of multi-shift working. They go on to say that shift work is exceptional at the moment. I do not intend to read many quotations but, if the House will forgive me, I propose to read one from the Committee's Report—and this is to be found on page xix,paragraph 46: Nevertheless it is in the highest degree desirable that efforts should be made to encourage its general adoption, that is, multi-shift working— in order to obtain the most economical use of the scarce machine tools, which are required in such large numbers and in every branch of defence production, and on which so large a sum of public money is to be spent. Modern machine tools and equipment are so expensive that single-shift working is becoming steadily more uneconomical. Two-shift working almost halves the capital equipment required for a given production, thereby reducing overhead costs. An extension of shift working would, therefore, benefit the rearmament programme by securing more production and lower prices. I venture to suggest that those two are of supreme importance to our national economy today—to get more production and at the same time to get lower prices.

Clearly, therefore, this is one of the vital recommendations of the Committee's Report and, if the House will allow me, I suggest that it is worth a few moments further consideration. Shift working is not popular with the bulk of workers concerned, although it is interesting to find that the Brierly Committee, which was set up by the present Government and which reported in 1947, and recently the Report of the Chief Inspector of Factories, state that once shift working has, been established it becomes popular with the persons concerned and, curiously enough—at least it struck me as curious —more popular with the women than with the men. Once it has been established, once we have overcome the problem of approaching double shift working, it is not as unpopular as the uninstructed might imagine. I suggest that at the present moment there are very definite advantages which would follow from the adoption of shift working.

Take the machine tool industry itself. The machine tool industry is a comparatively small industry and the provision of a second shift would involve a comparatively small number of men; but, far from working a double shift today, the machine tool industry is under-manned. We have what I suggest is the quite anomalous or ridiculous position, from the point of view of the national interest, that, as the Committee state, the workers in the machine tool industry are today being attracted out of that industry by the lure of higher wages into, for example, the automobile industry, only to find when they get there that, owing to bottlenecks in respect of various materials, the factories concerned are not working a double shift, or even a single shift, but are having to work short time for a week or more at a time. I suggest that that is a most uneconomical use of skilled labour today.

Furthermore, the machine tool industry, as a result of strenuous efforts which they made before the war and during the war and since, have been making a quite appreciable contribution to our export trade. If they continue to work only one shift and if they supply the machine tools required for our re-armament, that contribution is bound to be diminished; but if, on the other hand, it were possible to work a double shift, it is clear that the machine tool industry could not only provide for the domestic requirements of the re- armament industry but could also increase, or certainly maintain, their existing export market.

So much for the machine tool industry itself. If we look at the machine tools already installed in factories, as the Committee have pointed out, double shift working would have equal, if not greater, advantages. Quite apart from British tools, we are importing, or are hoping to import, a very large number of American tools. I have forgotten the exact figure, but the Minister of Supply told us the other day of the success he had had in 'placing orders to the tune of many tens of millions of pounds in the United States. He said he hoped to get delivery at periods ranging from 12 to 18 months.

I do not know what the latest information is, but certainly there have been disturbing reports in the Press recently that the pressure on the American machine tool industry is greater than it is here, and that the orders being placed are far larger than was originally anticipated. It is quite clear that if we were to get double working of the machine tool industry, the tools would be available at an earlier date and we could look with more equanimity on the possible late delivery of the remainder, or even non-delivery; and certainly we could save substantial quantities of dollars.

One of the Chancellor's headaches is the capital investment programme. What is to happen is that a large number of new factories are to be built in this country in order to house the new machine tools, all of which are going to work one shift. It is quite clear that if it were possible so to arrange matters as to work double shifts in a smaller number of factories, or on the existing machine tools, we could save a substantial set in capital investment in the building of new factories. Every factory saved obviously saves steel, saves cement, saves bricks, saves timber and labour. That is so obvious that I hardly dare repeat my argument.

Futhermore, all other things being equal, it would make it more likely that we shall reach our target—miserable target, as we think—of 200,000 houses. In that connection it is not without interest to observe the change in the emphasis between houses and factory building between the bad old days of Conservative rule between the wars and what is happening today. In 1935 the amount spent on houses was £166 million and on factories it was £26 million; that is about five to one. In 1950 the amount spent on houses was £237 million and on factories £102 million, which is just over twice as much, so it will be seen that relatively about twice as much was being spent last year on the building of factories as compared with houses than was the case in 1935. I should think hon. Members in all parts of the House would welcome the possibility that by building fewer factories we would be enabled to build more houses.

Then there is the question of power. I am glad to see the Minister of Fuel and Power in his place and I do not think he will disagree with my figures. I am informed that, with the best will in the world, assuming—it is a large assumption —that we get all the new generating stations planned within the period, it is unlikely that over the next six or possibly eight years it will be possible to do without substantial cuts in electric power very much of the size of those we are suffering from today, if the factories are run on an eight-hour day basis.

I am told that if it were possible to spread the load of the factories instead of over an eight-hour day over a 14-hour day by the institution of double shifts, even in such a restricted munitions area as the Midlands, that would automatically solve most of the problems of electricity generating in the next few years and might make it possible, in the absence of unforeseen breakdowns, to eliminate most of the cuts. Therefore, from a power point of view there is a great deal to be said for the institution of this system.

Such are some of the many advantages; I could illustrate more. Obviously, there are difficulties and it would be idle to ignore them— difficulties of transport, in the main, difficulties of hostel accommodation and a certain amount of difficulty of housing. I am not prepared, and I do not think anyone would be prepared, to argue that the housing difficulty is insuperable. It is not as though we had to build 500,000 new houses to accommodate the 500,000 men to be transferred to munitions from existing factories.

Obviously that is out of the question and the great bulk of the people to be transferred will have to live in their existing houses. The problem is mostly transport and hostel accommodation. But difficulties exist to be overcome, certainly in the times through which we are going, and I believe that in this case the reward of a substantial reduction in the cost of rearmament would be well worth the effort involved. I hope I carry the Minister of Defence with me in that.

There are other recommendations in the Report with which I will leave my hon. Friends to deal. I turn back to the figure of 6 per cent. reduction in the manpower of our manufacturing industries to which I referred, which is the corollary of the figures and recommendations of the Report. By itself it is clear that a cut of this nature is bound to cause a heavy drop in our export trade, a drop which will have to be made up by more than a proportionate cut in our domestic consumption.

The question arises, can the gap be made good by a corresponding overall increase in productivity? Quite clearly, to the extent that we can do so we shall reduce the impact of the re-armament programme on the whole of our economic life. Can the overall productivity of the manufacturing industries be increased to the extent necessary to close the gap caused by taking 6 per cent. of the men away?

Assessment of productivity is no easy matter and I do not think it is as easy as some of the glib statements by hon. and right hon. Members opposite might lead one to suppose. It is equally difficult, I think, to get an accurate picture of the difference between productivity in this country and in the United States. I think the general picture is clear, that before the war productivity per man in the United States was probably somewhere between two to three times as great as in this country. After the war productivity in this country was lower than it had been pre-war and in the United States it was higher.

Since the war there is no doubt at all that productivity per man in this country, quite apart from re- equipment of factories, has recovered each year, 4 per cent., 5 per cent., or 6 per cent., and is probably now at a level higher than it was pre-war. The graph of the United States increase in productivity is far less steep than ours, but nevertheless I think it true that the gap between our productivity and that of the United States is wider today than it was pre-war.

It is often suggested that the gap is due to the larger proportion of capital equipment at the disposal of the ordinary working man in the United States than in this country. Indeed, the Minister of Labour was reported as saying, at Porthcawl, that the American worker has 6 h.p. at his elbow as compared with the British worker with 2 h. p. He added that therein was the secret of his higher productivity. With all respect to the Minister of Labour, I do not think that is the whole truth. There is some element of truth in it obviously, but certainly it is not the whole truth. Otherwise, why in industries where equipment is approximately the same in both countries—for instance, in boots and shoes and in tobacco, and there are others —should we still find greater productivity per man in the United States than here?

Quite clearly there must be some factors other than the horse-power at the worker's disposal. I suggest, following very largely on the lines of the Committee's Report, that it is a matter of vital importance to the whole future of our country and certainly to getting through the crisis immediately before us, that we should try to identify what those factors are which result in greater productivity in the United States than here. They are undoubtedly partly organisational and also partly factors affecting the willingness and ability of the worker.

This is borne out in the reports of various teams of workers and employers which have been to America to investigate individual industries. I confess I have not read the two just published, but I have certainly read others. All these give more attention to the problems of organisation, of incentive and general productivity mindedness." One of the most interesting of all which emphasises this point is the Report of the T.U.C. itself, which has recently been published. I think it is one of the most interesting documents which has emerged recently. It pays more importance to these points than to the quality and quantity of the machinery installed in factories in the United States.

Whether we like it or not, we cannot today increase suddenly, by means of a magic wand, the whole of our physical equipment to the level of that of the United States. Yet the balance of evidence, on the part of the pundits, practical industrialists and trade union officials, is that considerably increased productivity could be obtained in other ways.

This task of increasing productivity still more is partly, I believe, the responsibility of management. I do not under-estimate the improvement that is necessary and is capable of being obtained by manage- ments, or their responsibility for making progress. That improvement is also partly dependent on the co- operation of workers but it is very largely the responsibility of the Government, by promoting conditions in which increased effort and increased efficiency are encouraged. I am certain that the Government have a large part to play.

Looking round, I think it can be said that it is a long time since optimum conditions for encouraging efficiency existed in this country. We had the depression from 1929 to 1931, followed by the slow, and in the event only partial, recovery. Throughout that time management were not sufficiently confident about the future to install new equipment on the scale required or, equally important, to take the considerable trouble involved in reorganisation, Labour on its side adopted —or if hon. Members opposite prefer it, was forced to adopt—restrictive practices in order to see that the jobs that were going were as far as possible shared out.

Conditions have changed fundamentally since those days. [Interruption.] It would be very tempting, in answer to that interruption, to go into the reasons, but I will refrain as I do not wish to detain the House too long; there is a good deal to be said on both sides. The fact remains that, for our purpose today, conditions have fundamentally changed. Yet, unfortunately, there is still a great deal of fear, too much of the old attitude of mind among employers and especially among workers. I believe it is true today to say that there are far too many workers who out of fear of working themselves out of a job fail to see the opportunity that a different outlook would afford them of securing a fuller life for themselves and their families.

Indeed, the Minister of Labour himself seemed to recognise this when he appealed, as I think he did in the speech at Porthcawl to which I have referred, or at all events in a recent speech, to industrial workers to free themselves from what he called prejudices created by bygone days, including the fear of redundancy, unemployment and wage cutting. [HON. MEMBERS "Hear, hear."] I began by saying that I hoped that this would be a non-party debate, and I am glad that I am so far carrying hon. Members with me. The Minister of Supply also, in a speech a little while ago, talked about the same thing. He said that one of the prerequisites for expansion—I believe that he was talking at one of the mills in Lancashire concerned in the new re-deployment—was greater confidence in the relations between employers and workers. That I would not deny

But this factor of increased productivity affects not only our re-armament programme, but our whole economy. I said earlier that an increase of productivity of 6 per cent. in our manufacturing industries would suffice to close the gap created by the withdrawal of the 500,000 men. That might have sufficed for rearmament purposes some weeks ago, but since then we have heard of the steadily deteriorating overall economic position.

We are to debate that on Thursday and I do not want to anticipate that debate in full: but I am told that at a dinner last week of persons concerned in the export trade a reliable speaker said that if we were to balance our overseas payments this year something of the order of an increase of 66⅔rds in our export trade would be essential. Even if the figure is not as high as that, conceive the cut in domestic consumption that will be involved. Yet if we do not balance our overseas payments, we are in effect asking the rest of the world to make sacrifices to enable us to maintain our standard of living, which in most cases is very appreciably higher than the standard of living of the people whom we shall be asking to make the sacrifices.

For make no mistake that by asking people to accumulate sterling balances from this country and not take payments in goods to which they would be entitled for the raw materials which they are sending us—that is, in effect, what we are doing we are asking the people of those countries to make sacrifices in order to enable us to maintain our standard of living. We lived for two years on the American loan. We lived for the following two years on Marshall Aid, because we were concerned with the dollar gap. Today it is not only a question of a dollar gap but of a sterling gap. We are asking the people of our Dominions and Colonies to come to our assistance as originally the Americans did, and the Canadians, with such generosity.

In face of that sort of condition, to talk about price control, dividend freezing and wage restraint is really begging the question. They are palliatives which may be necessary to tide us over the immediate crisis but they are not the cure for the condition.

Photo of Mr Robert Hudson Mr Robert Hudson , Southport

If the right hon. Gentleman will wait, I am coming to that point.

What we should be doing today is, not talking about increased productivity, but actually getting on with the job of enforcing and encouraging it. The Lord Privy Seal said in a speech last week that we wanted an increase in productivity of 20 per cent. from every worker and management in the land. In relation to the 6 per cent. about which we have been speaking, and the 4 per cent. of the Economic Survey, 20 per cent. seems a great deal, but it is not if one compares it with the 200 or 300 per cent. by which United States productivity exceeds our own. Unless we can get some increase of that order, the recommendations of the Select Committee on Estimates which we are discussing cannot be carried out.

So much for the Report. There are other recommendations which, as I have said, I shall leave to other hon. Members to discuss. I have tried to make a nonparty speech and to be as objective as I can. The situation in which we find ourselves is, I believe, far too dangerous for purely party matters.

In conclusion, I might perhaps be permitted to say a few words about our general situation, which of course, includes the situation envisaged by the Report of the Select Committee. We might just as well recognise that there are two opposing philosophies in this matter. The Socialist Party are in power. They form the Government. They are responsible for the safety of the realm, and for providing conditions which will ensure the economic well-being of the nation. I do not suppose that they deny that responsibility. Indeed, presumably the programme they have followed for the last five years was designed to ensure those two ends.

They point as proof of the rightness of their policy to the fact that productivity has increased over recent years by 4 per cent. or 5 per cent—the Economic Secretary to the Treasury said that it was 129 in 1949 and that today it is 146. In the debates on the Finance Bill, they used this increase in productivity as an argument to deny our thesis that the level of Government expenditure and the height of taxation were actual disincentives to increased productivity.

I think that the increased productivity achieved since the war was the result of, and a proof of, British resilience. What I cannot help believing is that it would have been very much greater indeed, and would have had much greater results, if it had been able to work in a much more congenial atmosphere. I am not surprised that the N.J.A.C.— the joint body of employers and workers—have not succeeded in obtaining spectacular increases in productivity. It is not because relations between employers and workers are bad. It is because, unlike America, neither employers nor workers have any adequate incentive to adopt measures for really increasing productivity.

It is a matter for regret that that aspect of the problem was not given greater weight in the Report of the Committee. Today, far too often, increases in productivity in this country do not receive adequate reward in wages. They are not reflected in increased earnings, and taxation sees to it that management and capital get equally little reward. The only person who gains is the Chancellor of the Exchequer.

What we believe the country needs is a healthy economic background, a balanced economy, instead of an economy based on continual inflation. We believe that if we got that balanced economy we could then introduce real incentives which would apply both to men and to employers. Today increased wages are swallowed up in the steadily increasing cost of living long before their advantages can be realised. My right hon. Friend the Member for Epsom (Mr. McCorquodale) told me of a case in his own industry where a recent increase in the pay packet of 10s. a week to his men to meet the increased cost of living was greeted at first with pleasure, but after the first pay packet they said, "Oi! This 10 bob to meet the increased cost of living is not 10 bob, because the Chancellor has taken three bob off it. There are only seven bob left and that is not enough." That is true, broadly speaking, of the whole of the employed people in the country.

I do not suppose for a second that hon. Gentlemen opposite will accept my diagnosis; but theirs is the responsibility. Right hon. Gentlemen opposite require great courage, because their job is to disabuse their followers of the doctrines taught to them for so many years. Not only do they require great courage but great leadership, because they have to induce their followers, once they have been disabused, to accept and to put into practice the new doctrine of the need for steadily increasing productivity. Unless they get that response from their followers, the standard of living of this country will fall catastrophically, and no amount of week-end speeches saying that they are all solidly behind the Government in the re-armament programme will prove of the slightest avail.

4.25 p.m.

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

I should like to congratulate the right hon. Gentleman the Member for Southport (Mr. R. S. Hudson) on succeeding in what must have been a very difficult task for him, that of making a nonpolitical speech.

Photo of Mr Robert Hudson Mr Robert Hudson , Southport

A non-party speech.

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

He succeeded admirably —probably for the first time in this House. I think we all appreciated his effort and that all were interested in what he had to say.

I am grateful to the right hon. Gentleman for raising the question of the Third Report of the Select Committee on Estimates. Often in this House we have debates on general re-armament problems —how far re-armament is possible, its impact on world affairs and the country's economy—but only rarely is interest displayed in the problems of the many processes connected with re-armament which closely concern my Department.

Indeed, it is remarkable, in view of the great re-armament activities of my Department and the Admiralty that we are so little worried by questions, criticisms or indeed observations inside this House or outside. I look upon that, I hope correctly, as evidence of my Department's success and its smooth carrying out of its task.

I should like to express appreciation, if I may without presumption, of the Select Committee, and particularly of the Chairman, the hon. Gentleman the Member for Abingdon (Sir R. Glyn), for their careful consideration of the problems which came before them and for their patient and thorough examination of a large number of witnesses. I should like to congratulate them on their Report, their conclusions, and the helpful manner in which they put forward their 16 recommendations.

Broadly speaking, we agree with their views and accept their recommendations. It may be that all the recommendations are not fully necessary but we find them most helpful. I should particularly like to express our appreciation—I am speaking not only for the Ministry of Supply but for all the Service Ministries to the hon. Member for Abingdon for the constant help and support he gives us in many matters unconnected with the Select Committee, and for the balanced and unbiased way in which he considers all problems bearing on the defence of the country. I am sure that the House as well as the Government are grateful to him for these services which he renders the country.

The right hon. Member for Southport dealt with one or two matters arising from the Select Committee's Report and used it—if I may say so without being in the slightest offensive—as a peg on which to hang a most interesting discourse on labour and productivity problems. But the Report we are asked to note today covers many other important subjects. I think it would be convenient to the House, certainly for the hon. Members who have studied the Report and especially the members of the Select Committee, if I gave my comments on the recommendations in the Report and said what we are doing about them.

Recommendation (1) is that the more readily available stores should be ordered this year. Broadly speaking, we agree with that, but there are limits to the extent to which it can be carried out. If we go too far we may find we are interfering unnecessarily and very severely with exports.

Recommendation (2) deals with scrap, and its price. I have touched on that matter in answering Questions in this House. The problem has been remitted to the Iron and Steel Corporation, but I should like to say that it is a very difficult subject, and that I greatly doubt whether we should get any more scrap if we raised its price—and this would have a serious effect on the trade.

Recommendation (3) suggests that my Department should quickly devise allocation schemes for all essential materials. Allocation schemes for steel and other materials are now being considered. We and the Ministry of Materials are in the closest contact with producers and consumers through a variety of organisations on all matters connected with the allocation and distribution of raw materials.

Recommendation (4) suggests that we should review the delivery schedules of mobilisation and training equipment and stores. We are in close contact with the Service Departments about this.

Recommendation (5) suggests that orders should be accelerated to take up the slack arising from the increased Purchase Tax on wireless and television sets. There has not yet been much slack, but we are watching the situation closely to take up any that does arise and to see that that industry is fully employed. I may add that we are not allowing sales of electronic equipment for private purposes to interfere with our defence orders. Recommendation (6) has already been dealt with by my right hon. Friend the Postmaster- General, and I do not think I need add anything to what he has said.

Recommendation (7) suggests that the arrangements for negotiations between my Department and the radio industry should be reviewed. I can tell the House that this difficult matter has been under consideration by my Department for some time. We have decided to set up a Radio Advisory Council, which will represent the radio industry rather more fully than previously. Its main purpose will be to enable my Department to discuss defence matters with the industry. Moreover, we shall appoint a Director-General of Radio Production to my Ministry; his responsibilities have not yet been quite finalised.

Recommendation (8) suggests that we should take steps to expedite the production of high-speed machinery for making special valves. We have done so, and some of that machinery is already being produced.

Recommendation (9) suggests that we should accelerate the design of new motor bodies and chassis and that we should phase the development of engines and chassis for vehicles required by the Services. We are pushing ahead as fast as we can with the design and development of new vehicles. I think there is some misunderstanding about the phasing of engine and chassis production, because we have standardised three types of engine, one of four cylinders, one of six cylinders and one of eight cylinders. One of these engines will go into all the wheeled fighting vehicles which the Services may require, according to their size, and we have nothing more to do on engine design in this respect. I am not, of course, talking about tanks. Transport vehicles will be equipped with the ordinary commercial engines produced by industry.

Recommendation (10) suggests that we should reduce administrative formalities for urgent defence building work. We are always trying to do this, but it is not easy, and I think the examples quoted in the evidence given to the Select Committee were misleading. One referred to an incident in 1947, when for economic reasons, a new building was virtually banned. The other was the much more typical case in which difficulties arise, and where there was real trouble.

Difficulty has arisen where a defence contract has been placed, or where new building was to have been erected for defence purposes, in an area where there was likely to be a shortage of labour. I admit, straight away, that that is a problem that confronts us from time to time, and which has to be very carefully considered. It is not a thing that can be done in two or three days— it may take two or three weeks or even longer.

It is far better that a problem of that kind should be given the most careful consideration by the Ministers concerned, and not merely by officials, rather than that a hasty decision be reached to erect building which might cost £1 million or more, only to find that the necessary labour cannot be found in the neighbourhood. We shall try to reduce the delay as much as possible.

Recommendation (11) deals with redundancy caused by shortages of materials, and suggests that the Ministry of Labour should encourage workers to transfer to work on defence contracts. That is happening now, and the Joint Advisory Council of the Ministry of Labour has issued recommendations along these lines to its constituent members.

Recommendation (12), again, has been put into effect. The Machine Tool Advisory Council has been asked to take steps to make everyone in the industry realise the importance of getting all the machine tools needed for the re-armament programme.

We have, after full consideration, rejected Recommendation (13) of the Select Committee, because we felt it would not help very much if all firms who had defence contracts were given a full list of the machine tools in the possession of the Ministry of Supply. When anybody who receives a defence contract finds it difficult to get machine tools, they speak to us about it. We have a full list, and we can tell them whether we can give them the particular machine tools they want. To circulate a full list would not be worthwhile.

Moreover the Recommendation of the Select Committee that there should be a census of machine tools in the country, so that they could be used for the rearmament programme, would not, in my view, be worth adopting. There are over one million machine tools in this country, nearly all of which can be used for defence work, and the time taken up by a census to find out the end use of any particular machine tool would be so great that I cannot think it would be worth while.

Our present arrangements for seeing that everybody with a defence contract receives the machine tools they require, as far as possible, either from home production or from abroad, are already effective, and I think it would be almost a waste of time to carry out Recommendation (13).

Recommendation (14) concerns the training of applied scientists and scientific workers. That matter is being taken up by the Advisory Council on Scientific Policy.

Recommendation (15) suggests the encouragement of schemes for training labour, up-grading semi-skilled workers and the dilution of skilled workers. This matter has been actively pursued by the Ministry of Labour, and the National Joint Advisory Council has already asked its constituents to implement a resolution to this effect.

The last Recommendation brings us straight to the matter about which the right hon. Gentleman the Member for Southport has been talking, and which occupied the main part of his speech. It is, admittedly, a very important point, and I would like to deal with it as well as I can. The right hon. Gentleman was anxious about the labour supply, and was concerned lest we would not be able to carry out our full re-armament programme without serious economic effects on the country, because, to achieve it by getting the extra people he quite rightly said would be required, there would either have to be, as he said, a serious cut in home consumption, or a marked rise in productivity. I do not disagree with him at all in that conclusion. Then he had something further to say on the machine tool problem, a matter with which I will deal in a moment.

It is most desirable that we should not cut our exports if we can possibly avoid it. Indeed, we want to increase them because of the serious balance of payments situation disclosed to the House the other day by my right hon. Friend the Chancellor of the Exchequer. We are doing everything possible to avoid the rearmament programme having the smallest adverse repercussion on our economic situation and on industry, but it is not always possible to prevent it affecting exports which, as I have said, we want to increase.

The problem of increasing productivity is, as the right hon. Gentleman said, a very difficult one, and the Government's powers in this matter are limited. We can produce the conditions in which productivity may increase. Indeed, we have succeeded in producing those conditions in the last few years during which productivity has increased at a phenomenal rate —far more rapidly than in any other period in the history of this country. But to increase it further, as we would like to do, requires not so much action by the Government as more action by industry itself.

Productivity is very largely a question of managerial ability. One often finds that productivity varies considerably between one works and another. The hîgher productivity in one works is usually the result of the ability of the management to organise the work, gain the confidence of the workers and to inspire their interest and so get the best out of them. In the works where there is high productivity there is usually a happy atmosphere.

Therefore, I say that, primarily, good productivity is a matter for management. Managers of British industry have appreciated that fact during the last few years and have made a major contribution in bringing about the remarkable increase in productivity— something like 8 per cent. a year—which we have seen during the last few years. That, of course, takes into account the increased number of people coming into industry.

I do not agree at all with the view put forward by some people—I am not quite sure whether it was put forward by the right hon. Gentleman—that there is something inherent in the British working man which makes him unable to produce as much or as successfully in the same period as his American confrère. It is sometimes suggested that the British worker is more apt to keep an eye on time, that he does not go all out, and that he is beaten by the American worker every time. I do not think that is true.

I believe—and all evidence goes to prove that this is so—that where conditions are equal, where there is the same type of good equipment, organisation and layout, the British working man and woman produce every bit as well and every bit as much as the American worker. Indeed, I remember that being pointed out to me by the manager of an American firm which has established in this country—as so many have done in recent years—a factory making the same product as the parent factory in the United States. The factory in this country was equipped with exactly the same machinery and had exactly the same organisational lay-out, and it was found that the workers produced almost exactly the same amount of goods as did the workers in the American factory.

On the other hand, I believe it is true that production techniques in many of our industries are below the standard of those in the United States. It is also true that we do not very often have the big production lines which make high productivity easier, and that the equipment of many sections of our industry is not so good or so modern as that in many American factories. Though that is true, British industry has re-equipped itself on a very large scale during the last few years. More capital has gone into new equipment in the last few years than ever before in our history.

I, as Minister of Supply, have taken many steps to increase productivity. We carried out a campaign for greater efficiency in the engineering industry to raise the productivity in firms where it was low. We received the fullest cooperation of the industry, and I think the campaign produced some good results. I also set up a committee to go into standardisation, and its recommendations are having some effect on productivity, though slowly.

The Government have taken all these steps and are anxious to take any further practical steps which the industry or hon. Members of the House can suggest because it is essential that in the next few years productivity should be as high as possible in order to avoid the impact of the re-armament programme on our economic life being too severe. It is also important, as the right hon. Member for Southport and as some of my hon. Friends have said, to eradicate from the minds of the people working in industry the idea that if they work too hard, they may work themselves out of a job, or that unemployment is just round the corner.

That sort of thinking has had a serious effect in the past, but I think that, today when full employment has come to say —at any rate, so long as this Government remain in office—that fear is receding and is not having the same restrictive effect as it had in the past. All the same, we are very anxious to have the co-operation of industry to try to increase productivity so that the re-armament programme shall have the minimum effect on our exports and on the production of goods for the home market.

I now wish to say a word on the other matter about which the right hon. Gentleman spoke at some length—the question of double shift work. The right hon. Gentleman spoke of this matter as if it were something new, as though the suggestion was new, rather foreign to present practice and which had to be explored. The fact is, of course, that there has been double shift work in the engineering industry for several years now. Indeed, a great part of our re- armament programme is based on double shift work, and in some of our Royal Ordnance factories today double shifts are being worked.

The Select Committee recommended that we should let industry know the result of double shift work in our Leeds factory. I can assure the House that there is no need to do that. We have no special knowledge or experience in this; our experience is no different from that of other industrialists whose factories work double shifts. I think that everybody in industry knows that, if it can be operated, double shift work is desirable for a number of reasons. It may be more expensive, because higher wages have to be paid for night work, although, of course, double shift work does not necessarily mean night work.

Photo of Mr Harold Watkinson Mr Harold Watkinson , Woking

The Select Committee referred to double day shift work, not to night shift work. Would the right hon. Gentleman deal with double day shift work as opposed to night shift work, which is a different problem?

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

I mean the night shift puts up the cost because of the higher wages; but one can double shift to the extent that labour and material is available and it is being done on a very considerable scale in industry today. It is no use my standing here, or the right hon. Gentleman the Member for Southport standing there, and saying that we must double shift throughout industry. It cannot be done without direction of labour. We are not prepared to do so at the moment and I am sure that the right hon. Gentleman was not advocating it. Unless one is prepared to impose direction of labour it is no use saying that we must impose double shift working in the engineering industry. There is only 0·9 per cent. unemployment in this country—at the moment. There are fewer than 200,000 out of work—and in present conditions one cannot get the labour to double shift.

Photo of Mr Robert Hudson Mr Robert Hudson , Southport

Surely that is not so. The Government presuppose in their re-armament programme that they will get 500,000 extra people and the question is whether they are to be employed on single shift or double shift working. The same thing applies to raw materials. The policy of the Government is based on the presumption that they will secure the requisite raw materials.

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

We are basing an important section of our aircraft defence production plan on double shift working and we hope that when we require that labour— which we do not want at the moment— we shall get it. We shall get it through other works closing down, may be through shortages of materials, and in the various ways already mentioned. But one cannot say that there must be general double shift working when the labour is not available. When it is said that double shift working is economic and uses machine tools to the best advantage of the country no one disputes it, nor that it should be adopted to the extent that it is possible and desirable. But, at the moment, it is only possible on a limited scale without direction of labour.

Photo of Mr Frank Tomney Mr Frank Tomney , Hammersmith North

It is by no means possible that we shall be able to secure the labour required in the electronic equipment industry. It is entirely specialised. I have a thorough knowledge of this and I can assure my right hon. Friend that very great difficulties will arise with regard to manpower and equipment.

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

I am well aware that the problems will be formidable in that industry and in many others, but the point I am making is that one cannot ask for double shift working everywhere and get it. It is limited largely by local conditions and the amount of labour and material available.

Photo of Mr Robert Hudson Mr Robert Hudson , Southport

The Government can stop their contractors from poaching. There was a case, quoted in the Select Committee's Report, of motor manufacturers poaching from the machine tool industry.

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

I do not know what steps the right hon. Gentleman suggests the Government should take to prevent contractors from recruiting people from another industry. I am very doubtful whether the very drastic step of control of labour and employment which that would involve would commend itself to British industry generally.

It is perfectly true that a great deal of poaching is undesirable. I am not suggesting that to get people away from one industry to another by offering them higher wages, and particularly to an industry not making an essential product, is desirable; but I should like to hear the right hon. Gentleman say how it should be stopped. It was never stopped during the war.

My hon. Friend the Parliamentary Secretary will deal in detail with any matter which may be raised in the course of this debate. There are also many problems brought up in the Select Committee's Report with which it is impossible for me to deal in my opening remarks. My hon. Friend will deal with them. However, there are two or three general points which I should like to put to the House, in conclusion. They arise from the Report.

First, I should like to tell the House that we are getting very good co-operation from the engineering and other industries with which we are placing our orders. We have innumerable contacts with them through associations and direct personal talks and we give them all the information we can. I do not think they can justifiably complain that they do not have the necessary information.

I can also say without any hesitation that, broadly speaking, the engineering industries realise the urgency of the rearmament programme and are doing everything they can to co-operate with us in producing the equipment. I say that as a result of a great many personal visits to firms in the engineering industries and their constant contacts with my Department.

I should also like to tell hon. Members, although they may be aware of it, that we in the Ministry have very much strengthened our Department and will continue to strengthen it to cope with the big burden re- armament has imposed upon us. We have appointed leading people from industry as deputy controllers. We have appointed from industry a Director-General of Machine Tools and an Advisor on the Substitution of Scarce Raw Materials. These people have already helped me and my Department in placing orders and in our contacts with British industry.

The House will be aware that many difficulties are bound to arise in starting a big programme of this sort. They are difficulties of where to place contracts, difficulties of shortage of materials, which are serious for steel and non-ferrous metals, and difficulties about machine tools. We are trying to face those difficulties and I think we are overcoming them steadily. But I should like to say this to the House on a matter on which there has been some dispute. It is that we believe that, with the steps we are taking, we will not fall behind in our production programme provided for in this year's Estimates.

When the Estimates came before the House and later, when we had debates on the re-armament programme, it was suggested by some hon. Members on the other side of the House that we would not fulfil this year's re-armament programme; and some of my hon. Friends suggested we could not. There will be some short-falls, of course, as inevitably there are in a production programme. On the other hand, we shall be getting in advance of ourselves in providing other equipment. We are also buying a considerable amount of material abroad, and some of the materials we require and which are contained in our programme have gone up in price.

But by and large it appears at the moment—although I cannot be certain about this—that the amount provided in the Estimates for re-armament this year will be about spent. It may be a little short, it may be a little more.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

Can my right hon. Friend give us any preliminary estimate whether he thinks the same position that he has just described will apply in 1952 as in 1951? I see that he is being adequately prompted by the Minister of Defence. Surely he discriminates between spending the amount of money that was forecast and getting the amount of equipment that was forecast. I have no doubt at all—I have never had any doubt that he could spend the money. That is easy, but will he get the stuff?

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

The answer to the first point is that I am dealing only with the Budget estimate for the year 1951–52 and saying that, as far as I can see at the moment, the money will, broadly, be spent on defence equipment. I cannot prophesy for 1952–53 at the moment because I do not know how much will be in the Budget. If my hon. Friend asks whether, out of that expenditure we shall be getting the exact goods put down in our programme at the beginning of the year, the answer is "No." Some of the goods will fall short; that is inevitable.

On the other hand, we shall get some goods required equally urgently which were not in the list. By and large, we shall carry out the defence production programme, with some variation between items, to the extent that it was included in the defence estimates and forms part of the Budget. As far as I can see, there will not be very much one side or the other, but it is early days yet—we have had only a few months. As far as I can estimate at the moment, we shall not be far out one way or the other. I thought the House might be interested to know this, in view of the questions which have been asked.

Photo of Colonel Cyril Banks Colonel Cyril Banks , Pudsey

The right hon. Gentleman said that he did not think we could spend the amount of money on armaments during this year. If I am right, I believe that the amount of money that has been contracted for is around £900 million. Surely that is far below the figure indented. Is that true or not?

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

Roughly £900 million of contracts are outstanding. The amount originally contained in this year's Budget was £340 million for my Department and £120 million for the Admiralty; an additional £160 million was put in, which was the difference between the equipment needed this year under the £4,700 programme and the £3,600 programme. The point I am making is that, as far as we can see at the moment, it will be fully spent on defence equipment. I think that that answers the hon. and gallant Gentleman.

Photo of Colonel Cyril Banks Colonel Cyril Banks , Pudsey

That is not purchased abroad? That is here?

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

Partly purchased abroad. It includes a substantial amount of equipment, machine tools and things, which we are buying from Europe.

Photo of Colonel Cyril Banks Colonel Cyril Banks , Pudsey

Can the right hon. Gentleman say what proportion of that is purchased abroad?

Photo of Mr George Strauss Mr George Strauss , Lambeth Vauxhall

I do not think that that is relevant to the point I am making. Something like over £50 million worth of goods have been purchased in Europe. Some have been purchased in the United States. But I really do not think that is relevant to my point, which is purely budgetary, and the fact that we are this year providing urgently required defence equipment to the extent estimated in the Budget.

In conclusion, I should like to give some indication of the great activity of my Department in providing the goods needed by the Services. It may interest the House to know that the defence contracts we have made with industry between 1st September last year and 31st May this year number no fewer than 51,000. That is only one indication—I could give many more—of the energy and intense activity which characterises my Department at the moment in carrying out the defence programme. We are in the early stages, and production is increasing slowly but steadily. New lines are being laid down for much greater production later, and preparations are being made for the full impact of defence production on industry in this country.

Whatever view may be held about the size of our defence programme, and although we all deplore its need, there is general agreement that we must build up our defences and strengthen the forces of collective security as quickly as possible. The House can rest assured that we in the Ministry of Supply—and the same is true of the Admiralty—are building up our defences as quickly as possible with, I think it is true to say, marked success, and a spirit of determination and real urgency.

5.5 p.m.

Photo of Mr Harold Watkinson Mr Harold Watkinson , Woking

In listening to the Minister of Supply, one cannot have been but impressed—and I do not mean this in any party political way at all—with a feeling that there is no desperate urgency in his approach to this problem, and I should like to address my remarks to that general question, because the underlying foundation of the Third Report from the Select Committee on Estimates is undoubtedly whether we can get the necessary extra production to do the job that we wish to do in the time that we have in which to do it.

It is from that point of view that there does not seem to me—and I think perhaps I can speak for a good many people in industry in the country—to be enough urgency here to meet the full weight of the programme. That is supported to a certain extent by replies given recently by some of the right hon. Gentleman's colleagues. For example, the Economic Secretary to the Treasury in the House, only last week, when I asked him what steps were being taken to secure a more rapid increase in productivity, gave a fairly general reply, and added at the end, I am satisfied that it is better to allow the present methods to develop…rather than to add, at the moment, to their number."—[OFFICIAL REPORT, 17th July, 1951; Vol. 490, c. 1061.] A somewhat similar reply was given to me by the Chancellor when I asked him some little time ago whether he would consider calling a national conference which would embrace the N.J.A.C. and all the other committees of employers and trade unions involved, to try to get a feeling of urgency in the whole country on this question of building up productivity with the re-armament programme in view.

I wish the right hon. Gentleman's speech had taken that factor a little more into account, and that we had all felt that this was a desperate and urgent job, because, to put it no higher, it is surely one of the most important campaigns in the cold war that we are now faced with, and I would say that it would represent a major victory for this country if we could sucessfully win it. I therefore think that my right hon. Friend, in raising this matter today, has performed a public service in bringing the question before the House, and I hope that we shall so consider it in our proceedings today as to give the country some idea of the urgency—and I believe desperate urgency—of this task, if it is to succeed.

Let me return to the question of productivity, which I think underlies the whole Report. I agree that all statistics are somewhat misleading, but if we take as a guide the fact that a 1 per cent. increase in productivity adds £80 million to the total production of our country, we get some impression of what an increase in productivity could mean to us at this time. If we could have got even a 10 per cent. increase this year—which is only half the figure asked for by the Lord Privy Seal the other day—it would have done most of the job of carrying the effort of rearmament this year. In fact, it would have resulted in an increase in national production just about equal to the amount of contracts which the right hon. Gentleman has said have been placed in other words, about £800 million.

I make no apology for labouring this point, because I do not believe that there is in the country as a whole at the moment, amongst employers and employed, enough feeling of the real sense of urgency of this task of securing the end which the Select Committee on Estimates dealt with so ably in their Report, of covering our re-armament commitments in these three years while yet doing the almost incredibly difficult thing of maintaining our general trading position in the world. The Chancellor did not disagree when in our debates on the Finance Bill I suggested that we want £500 million more of exports this year merely to account for a depreciation in terms of trade.

We cannot possibly carry out our re-armament programme unless we can secure our raw materials, and obviously we cannot secure our raw materials unless our trading position is maintained so that we can buy freely in the markets of the world. Add £ 4,700 million on rearmament in three years to an extra £500 million in this year in increased production for exports, and we have some measure of the terrific task that faces British industry. I should like to feel that we are generating in this House today some sense of national urgency—

Photo of Mr Harold Watkinson Mr Harold Watkinson , Woking

—of this job which we have got to do, and which, of course, can only be done by a full and free association between the three partners in the job, organised labour, the employers and the State itself. I want for a moment to deal with that point. If we could achieve a 10 per cent. increase in productivity this year, a 15 per cent. increase in 1952 and a 20 per cent. increase in 1953, most of our troubles in re-armament would be lifted from our shoulders.

It would be unwise to dismiss that as a thoroughly impracticable idea, especially when we consider—and I am referring to cases from a publication called "Target" issued by the Treasury, which is a very good publication, and which does a great deal in industry in letting one factory know what another factory is doing—that the Bolsover Colliery has achieved a 50 per cent. increase in productivity by a new method of shift working; and when one reads that other firms can achieve a 20 per cent. or 30 per cent. increase in productivity, it shows what can be done.

Photo of Mr Ellis Smith Mr Ellis Smith , Stoke-on-Trent South

It is always the same people who do it. They have been doing it for 16 years, but there is no similar effort made outside industry to that made by those engaged in industry.

Photo of Mr Harold Watkinson Mr Harold Watkinson , Woking

I take it that the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) is saying that on industry there is too much of a burden of outside people.

Photo of Mr Harold Watkinson Mr Harold Watkinson , Woking

I would not disagree, and that follows rather closely the line taken by my right hon. Friend the Member for Southport (Mr. R. S. Hudson), when he argued that there is not enough incentive given to us in industry to stop pulling our punches and get on with the real job, which is an increased productivity not before known in this country. It has been proved in individual cases which I have quoted that it can be achieved, and we also all know of similar cases in our own constituencies. We all know of some factory which is doing a splendid job and producing unheard-of levels of productivity, not necessarily by installing new plant, because in many cases the job is not done with new plant, but because management and workers are productivity conscious.

By quoting individual examples one can prove that a target of 10 per cent. increase this year, 15 per cent. increase next year, and 20 per cent. increase the year after would be quite possible, provided, of course, there is an adequate flow of raw materials. We do not want to return to that subject now, but, in passing, may I say that from my own point of view in the engineering industry I am not sure that a lot of the scare talk that we cannot increase productivity because of the shortage of raw materials has not been overdone. I am inclined to the view that the factory which is prepared to go out and find the raw materials or make the best use of substitutes will reach its target, as has always been the case.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

Is the hon. Gentleman suggesting that a car factory which is compelled, by the shortage of raw materials, to shut down from five days to four days a week, can seriously think about increasing its productivity?

Photo of Mr Harold Watkinson Mr Harold Watkinson , Woking

The hon. Gentleman is not quoting all the facts, because the position in the car industry is that the shortage is due to one specific shortage of sheet of which there will be more available when the Margam works come into full production. The present shortage is due to the fact that the American supply of that particular type of sheet fell short of what it was hoped would be the case. I am not going into the merits or demerits of the matter, but that is a special case. Over the field of industry as a whole I am not prepared to accept that we are going to sit down and do nothing about increasing productivity because the raw materials are not available. That, in my opinion, is a policy of despair.

I want to come now to my main point, and I want to bring to this discussion helpful, and I hope not in any way political, ideas. I want to see the Government, who, after all, are responsible for doing this job, trying to create on behalf of employers and workpeople a greater sense of urgency. I do not think it good enough at the moment that both sides of industry are paying only lip-service to this idea of greater productivity, because I am not sure that that is the way to achieve results.

My right hon. Friend the Member for Southport quoted from this very interesting report, "Trade Unions in Productivity," issued by the T.U.C., and I hope that every hon. Member has read it. It is a most valuable and excellent report, and I personally agree with practically everything that is said within its pages. I should like to see it being carried out a little more by all those concerned, and that includes the Government, who should give a lead in this matter. The report says on its first page that the main duty of the British trade union movement should be to seek a reasonable standard of living for all, and that it should be achieved through an increasing industrial production per man-hour. That seems to me to be a very good motto for our proceedings today, and I wish that we had had a little more along those lines from the Minister of Supply in his speech. That is the kind of message which we should sent out to the country from this House today.

I should like to deal with my side of industry, the employers. I do not think we are doing enough, and I do not think we are being given the lead to do it. For example, I do not think that enough employers are following the example of the best ones, and fully disclosing to their employees how their manufacturing costs are made up and the enormous slice which is taken by wages, raw materials and so on. For example, in my own case one-third goes in wages, one-third in raw materials and by the time the Government have taken their slice in taxation, we are left with 7½ per cent. for net profit, which is not, in my view, an unduly generous return for the risk and the labour involved.

It would be to the advantage of all of us if that sort of thing were done more widely. It would be to the advantage of all of us in industry if all employers followed the good example of those enlightened employers who publish their balance sheets in simplified form for their employees and break down the costs, revealing all the facts of running a business. If employers were to do that and would use joint consultation, take the people who work with them into the picture, make it quite plain to them that we are working together as a team on this job, then we should be playing our part.

It is up to the Government to try to give a lead in this matter and there is a very simple way for them to do it. They are the employers in the nationalised industries, and I should like to see more pioneering work done in those industries on the question of breaking down the costs of production, using joint consultation to the greatest possible extent, and, above all, approaching this matter in a genuine spirit that this is the major battle that this country has to fight in the next three years, and that if we win we shall do more to secure peace in the world and a better future for our children than any other single thing that we can do.

The Government should go into this as a member of a closely-knit partnership between State, employers and organised labour. Because the State is responsible for our security and should give a lead, I believe that the Chancellor of the Exchequer—the person primarily responsible for initiating these things—should call a conference of the N.J.A.C. on the labour side, and his own consultative committee, the National Production Advisory Committee on Industry, and try to generate a feeling that this is a real battle which we have to fight—a battle in which no restrictive practices, either by the employers or the employees, should be allowed to stand in the way of increased productivity.

If that is done, I believe that the goals I have outlined are not impossible of achievement, and if they can be achieved then we would be over the hump of the most difficult job we have to do in the next two or three years. I believe that can be done, and I only hope that when the Government spokesman winds up we shall have a greater sense of urgency and a greater sense of leadership than we have had, and some spark to start off the new drive for productivity to win this battle that we know we have to win.

5.20 p.m.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

The hon. Member for Woking (Mr. Watkinson) clearly spoke with feeling and with deep sincerity, and one hesitates, therefore, to be critical of anything he said, but I think, if I may be allowed to say so, that he was wrong on two grounds. I join with him in believing—indeed, I have spent most of my time these last few years advocating this, as, I expect, he has done —that we can benefit by a wider extension throughout industry of proper practices of joint consultation.

I differ from the hon. Member when he says, "Get the nationalised industries to do it, and then, perhaps, others will follow." In fact, a good deal of the pioneer work for which he is asking is being done with a considerable measure of success in the nationalised industries; but in the private sector, notwithstanding all the urging that the hon. Gentleman and I and others have done, I am bound to say—and I say it with regret—of the 70.000 firms in this country, the number I know that actually do carry out this practice properly can be counted on the fingers of my two hands. I do not know how much more exhortation the hon. Gentleman and I and other people have got to do before we get any considerable increase in that number.

Photo of Mr Harold Watkinson Mr Harold Watkinson , Woking

The hon. Member is quite wrong in saying that there are no more than 10 firms in this country who are carrying out the requirements which I laid down for the employing side of industry. That is manifestly absurd, and I can give the hon. Gentleman at least 50 examples of firms carrying out this requirement.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

I did not say that there were not more than 10 carrying out this properly. I said I did not know of more than 10 who were carrying it out properly—

Photo of Mr Harold Watkinson Mr Harold Watkinson , Woking

That is quite different.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

—and I do not. In any case, it depends upon what we mean by "carrying it out properly." If the hon. Gentleman thinks that the requirement of joint consultation is met by breaking down a balance sheet into a simplified chart and sending it to the employees, then his interpretation differs from mine. I also disagree with one or two of the things that the hon. Gentleman said about productivity, but I should like to touch on those later on.

In the terms of the Motion that we are considering, and in the terms of the way in which it was moved by the right hon. Member for Southport (Mr. R. S. Hudson) in a speech which I for one, if I may say so, enjoyed very much, we are not here today discussing the great political question of whether the present level of re-armament is the right way in which to deal with our situation vis-à-visthe other nations of the world. Perhaps that is the sort of subject to which we may turn on Wednesday. We are here dealing with this problem on the technical level. It seems to me that on that level there are three questions to which the House ought to address itself.

The first is, is the present programme at its present height really necessary? I make no apology for introducing that question because, of course, the size of the programme affects the method of carrying it out and the efficiency with which it is carried out. For instance, both the right hon. Gentleman the Member for Southport and the hon. Member for Woking mentioned the question of the impact of this programme on our industry as a whole, and it raises the question also of how much labour we need to turn from one sector to another. Such questions are questions about the size of the programme and not questions about the nature of the programme.

The second question—and I think that this is related to the first—that we need to consider, since we are doing this as part of the joint Western re-armament programme and of the North Atlantic Treaty Organisation programme, is, are we carrying our fair share of that joint programme or less than our fair share or more than our fair share? The third question to which I think we should turn is, are we physically capable of executing this three-year programme at all?

On the first of these questions, as to the size of this programme, its present height, it is clear that the major consideration which influenced the Government in deciding that this level of rearmament should be injected into our industry at the present time—the major consideration which was in their minds—was their estimate of the military strength of the only potential enemy we in this House ever talk about, namely, the Soviet Union and its satellite countries. It is, of course, always wrong to underestimate any potential enemy. It is equally wrong to over-estimate any potential enemy.

The history of the last 12 years would have been very different and, I venture' to say, very much happier if we had not made the mistake as a nation of overestimating the strength of Mussolini in 1936 and of Hitler in 1938. It seems to me, too, that we are in danger now of over-estimating Russian strength, and proposing, on that over-estimate, a level of re-armament which is going to strain our economy to breaking point—which is amongst the difficulties to which the Select Committee referred—however carefully it is managed.

In considering the extent to which my suggestion is true, that we tend to overestimate Russian strength, let us consider the relative industrial potential of the East and the West, on which subject there is a most illuminating leading article in the current issue of the "Economist" that goes to show that in any war that lasted for any length of time, and which, therefore, would be settled, not by the initial relative deployment of soldiers, sailors and airmen, but by the ultimate relative deployment of industrial potential, there could be absolutely no question about the West's being greatly superior.

The countries embraced within the North Atlantic Treaty Organisation have three times as much coal between them as the whole of Eastern Europe and the other Russian satellites can bring to bear, and five times as much pig iron, and six times as much steel, and eight times as much oil, and an average level of industrial productivity much greater than the average level of industrial productivity in the Communist countries. Therefore, if one takes this all-important factor of industrial potential into account, there can be no doubt about the fact that we are greatly over-estimating the strength of the potential enemy.

But aside from that let us consider the immediate military position. What are we told about the present immediate military balance as between East and West? What are we told about the immediate strength of Russia? The Minister of Defence recently, in one of his charming week-end speeches as a propagandist—which, I must say, with respect, are sometimes a little difficult to reconcile with his actions as Minister of Defence—said that Russia had 175 divisions. A few weeks afterwards the new Under-Secretary of State for War outbid him, and said that the Russians had 215 divisions. They had gone up 40 divisions in a few weeks. That is productivity, that is. We could do with a piece like that ourselves, could we not?

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

I gathered from the hon. Gentleman's earlier remarks that he had been reading a leading article in last week's "Economist." I hope that, as he referred to one part, he will quote also the latter part.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

I did not quote it because I do not happen to believe it is true. I said that there was an important article in the "Economist." I do not agree with all its conclusions. It contains some interesting facts, which saved the hon. Gentleman and myself digging into the sources ourselves, and those facts are useful: but, of course, the "Economist" always concludes with the final conclusion that all we have got to do—politicians like the hon. Gentleman and me—is to get out of the way and leave Mr. Geoffrey Crowther to run the job and' all will be well. I do not agree with the conclusion. The Russians have got this extra 40 divisions in two or three months which, as I said, is a nice piece of productivity. We are told they have 19,000 first line aircraft, including a great many jets which are better than any that the West has got.

Since we are trying to figure out how we should run our re-armament programme, I think we ought to ask how the Russians managed to get away with this terriffic re-armament programme of theirs. In order to do this, I turned to the Economic Survey of Europe, in 1950, as "The Economist" did, which is pre-prepared by the Research and Planning Division of the Economic Commission for Europe, published by the Department for Economic Affairs of the United Nations. Here we can get some comparisons between re- armament efforts of different nations—between nations in the East and nations in the West—and we can see if we can find some way ourselves of increasing our Armed Forces by 40 divisions every two or three months.

On table 66, pages 136 and 137, in this Report it is shown that the military expenditure of the Government of the Soviet Union represents 21·2 per cent. of all the expenditure of the Government of the Soviet Union. In 1951–52 the military expenditure of the Government of Great Britain is 34 per cent. of the total expenditure of the Government of Great Britain —a rate of expenditure one and a half times as great as the rate of expenditure of the Soviet Union.

Photo of Sir Austen Albu Sir Austen Albu , Edmonton

Is my hon. Friend suggesting that the items included in the Soviet budget are the same items as those included in the British Budget?

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

If the hon. Gentleman will allow me, I shall try to answer his point. I turn to page 138—I think this will satisfy my hon. Friend—and I quote from the United Nations Report: In the absence of estimates of national income for eastern European countries fully comparable to those of western Europe"— That will please my hon. Friend— an attempt has been made to establish a common measure of the economic burden of defence expenditure by expressing each country's expenditure in terms of the man-years of industrial labour which it would buy in that country. I see that my hon. Friend nods his agreement that that is a fair and valid comparison.

What does this show? It shows that in 1951–52 the Soviet Union is spending on defence 10·2 million man years as compared with our expenditure on defence of 4·2 million man years. Thus, as the House will see, the Soviet expenditure in that fair unit of measurement is about two and a half times as great as ours. But, of course, the output of a man year in the Soviet Union is not the same as the output of a man year in Great Britain, it is substantially lower we do not know by how much lower because we cannot get accurate figures, but we know that it is substantially lower.

Therefore, this apparent expenditure in the Soviet Union of two and a half times as much as we spend is actually substantially less. It is somewhere between the same as ours and double ours, and I think it is probable, taking into account the difference between productivity here and productivity in the Soviet Union, that their expenditure in these real terms is about one and a half times our expenditure. They spend one and a half times as much. But look what they get for it!—215 divisions and 19,000 first line aircraft—and we, spending two-thirds of what they spend well, it takes us years to build up to 10 divisions. I am wondering how they do it.

It seems to me that we send our productivity teams to the wrong country. We ought to send a delegation, led by the Minister of Defence, to Moscow to find out how, by spending 50 per cent. more than we do, they manage to get 20 times as many divisions as we do.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

Would my hon. Friend allow me?

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

I fear my hon. Friend's help.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

I only want to help my hon. Friend in this respect. I have here a quotation from the Minister of Defence who estimated the Russian divisions in March at 175. The number of divisions estimated by the Under-Secretary of State for War a few months later was 215. If the Russians can produce 40 divisions in a few months, is there not something odd?

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

I have just been saying, that. I am sure my hon. Friend has many weighty points to make in this debate, but I would beg him, using factory terms, to be good enough to make them in his time and not in mine.

The conclusion I draw—this is a serious subject and I think we are treating it a little lightly—from a serious attempt at an analysis of military expenditure is that a great deal of what we are told about Russian military expenditure is bogy-bogy talk. On the United Nations' estimate of their defence expenditure they could not possibly get anything like what we are told they get.

I turn to the second of the three questions which I have posed, namely, are we doing our fair share by comparison with the rest of the countries in the North Atlantic Treaty Organisation? I have" already pointed out, quoting from this Report, that the percentage of our total expenditure devoted to military matters this year in this country is 34 per cent. That is a much higher figure than the percentage of any other one of the European N.A.T.O. Powers.

Once again, if we turn to this real criterion of defence expenditure in man years, as I say, we are spending this year 4.2 million man years on defence. That is much the highest figure in Western Europe. It is nearly double France's expenditure. France comes next with 2.2 million. That country, with a population nearly as great as ours, is spending only about half the number of man years on defence that we are spending.

A still more significant criterion, which evens out the differences in population between countries, is to take defence expenditure in man years per thousand of the population, because that is the real measure of the burden of defence upon the people of the country. We in this country this year are spending 82 man years on, defence per thousand inhabitants. That is by far the highest figure of any country in the world. The United States, even with its accelerated armament programme, is spending, by comparison with our 82. 74 man years on defence per thousand inhabitants. France comes next with 51, the Soviet Union 49—not much more than half our figure—and all the other N.A.T.O. Powers other than France have a figure well below that of the Soviet Union. The fact is—it is a hard thing to say, but truth will out—that some of our allies are stealing a march on us, and they are cashing in on the industrial dislocation caused in this country by our higher level of re- armament, to their own benefit.

Many hon. Members, I should think, will yesterday have seen what seems to me to be a very important report in the "Observer" on the question of car sales. It says: While British motor car makers and traders are losing custom because of the rearmament programme, manufacturers in other West European countries equally concerned in North Atlantic defence are showing gains. The production of German, French and Italian cars has gone up by at least 10 per cent. since January, The production of British cars in the same period has gone down by 7 per cent. As a result, British prices have risen and other European makers have been able to reduce theirs. Sales, particularly of the German Volkswagen, have gone up in Belgium, Switzerland and Sweden, and to some extent in Denmark, and in the same countries people are now buying fewer British cars. The report goes on to say: British car makers are still disturbed by what seems to be an inequality in the rearmament burden between member-countries of the North Atlantic Treaty Organisation. British car makers are not the only British people disturbed by this inequality in the re-armament burden between the member-countries of the North Atlantic Treaty Organisation.

This illustrates a point which many hon. Members opposite have been making ever since January, and one which was made notably by the right hon. Member for Huyton (Mr. H. Wilson) in his resignation speech, that we cannot get this present level of re-armament and at the same time close the export gap.

The Minister of Supply has told us of the plans that we are making in respect of this year's allocation on re- armament. If we reach this level of re-armament, we only do so by ruining our export drive. We can carry on the export drive but only at a lower level of re-armament. What I have read out about the British car sales being cut into to the benefit of Continental competitors by the present level of re-armament goes to prove abundantly that we cannot at the same time maintain the export drive and the present level of re- armament.

Photo of Sir Spencer Summers Sir Spencer Summers , Aylesbury

The hon. Gentleman is showing the impact of rearmament on the motor trade as resulting in fewer sales while other countries have increased theirs. Is he aware that in the Report which we are discussing these words appear on page 117? …the motor industry as a whole has not sufficient contracts or information to allow them to plan their production for the requirements of the re-armament programme. In other words, they have not yet had sufficient orders to produce the effect which the hon. Gentleman is now trying to describe to the House.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

Quite so. I agree with the hon. Gentleman precisely. I am not arguing that what is happening in the motor car trade is that the Government have come along and said, "You must stop making motor cars and start making tanks." If that had happened, it would not have been half as bad as it is. They have said, "Stop making motor cars," but they have nothing to put in its place. I say that the position is, if anything, even worse than what has been described in the report in the "Observer" and of the Select Committee.

The right hon. Member for Huyton argued, in his resignation speech, that we cannot fulfil our re-armament programme and have a large export drive. The Chancellor of the Exchequer hotly denied that at the time. But what is happening at present with regard to our exports and the widening trade gap, which is becoming very serious, is in fact proving that the Chancellor of the Exchequer was wrong and the right hon. Member for Huyton was right.

My third and last point is this. Can we physically carry out this re-armament programme? That was a subject which I imagine was very much in the minds of the Select Committee when considering this matter. Over the week-end, the Prime Minister made a statement, and repeated something which he and his hon. Friends have said before, to the effect that this £4,700 million was a carefully calculated amount based on a proper estimate of all the physical factors. Without in the least wishing to impugn in any way the good faith of the Prime Minister, I am bound to say, for reasons which I propose to adduce in a moment, that I find it very hard to accept his statement without any reservations at all.

I find it hard to do that because I have some little conception—if I may say so with modesty, having done some of this work—as to what is involved in the purely physical planning job of working out a programme of this sort. There was very little time to do it in. It was in September that the Government were talking about £3,600 million, and it was only 20 weeks later that they changed the amount. It could only be for the last two, three or four of those 20 weeks that they were getting down to the physical job of preparing the programme. I hope that I shall not bore the House if I try to describe what is involved by this programme. It is a colossal job.

If we try to work out how much steel it takes to make 5,000 of a certain type of tank, we cannot just add up all the steel that goes into a tank and multiply it by 5,000. There is the steel in the tank, the steel for rejects in making the tank, the steel for spares supplied with the tank and the spares which will be indented for after the tank has been put into operation, the steel that goes into the tools with which to make the tank, the steel which goes into the lorry in which to transfer the tools that make the tank, and the steel that goes into the tools that make the lorry which transfers the tools which makes the tank. We have here an almost infinite multiplier in descending geometrical progression.

It is the same with regard to coal. Was there ever a calculation made of the amount of coal which would be required to run this re-armament programme? I do not believe that there was. I should have thought that if that calculation had been made, the result would have deterred the Government. How does one work out how much coal it takes to make a jet bomber? We have to calculate the coal necessary to heat and power an aircraft factory, the coal necessary to heat and power the sub-contractors' factories, the coal necessary to drive the trains to bring the components from the subcontractors to the contractors, the coal necessary to heat and power the sheds where the locomotives of these trains are made, and the coal necessary to heat and power the factories making the tools to make the locomotives which draw the trains.

This vast problem would be impossible except for the wisdom of providence which has insured that even an infinitely long descending geometrical progression has a finite sum. If we took our time and had the staff and the statistical technique and the accounting machinery, we could arrive at an answer. In the United States men like Professor Lermentor, with the use of electronic calculators have brought this down to a fine art. The American Government have done this. The American Government, in fact, before putting out an order for 10,000 of a certain type of aircraft, calculate by the method which I have described how much coal it is going to take.

We had something of the same sort of thing during the war, not with electronic calculators but with slightly less advanced techniques, and with a great deal of very up-to-date accounting machinery. What has happened to all that programming staff? They have disappeared. I am reliably informed that as recently as a month ago all that was left of this programming staff which we had during the war was one man—literally one human being, one brain, one slide-rule. I refuse to believe that one man, one brain and one slide-rule can tell us what we really ought to know when we are embarking on this programme and what will be required with all the background of factors and multipliers in coal, steel and materials and labour of various sorts.

I am most worried about the coal situation. Coal is the one material where, if we go wrong in our calculations, we cannot pass the buck to anyone else. It is not a subject of international allocation. It is the one raw material under our own control which. normally speaking, we produce enough of for our needs.

I am bound to say—and I have an idea that the Government are beginning to give some hint of this—that we are going to have this winter a danger of a first-class coal crisis because we have not calculated in advance the demands in types of coal of the re-armament programme. Certainly, the Government could not have known in January how much they would want of every imported critical material and whether they could get the necessary quantity.

Now, about labour and productivity, on which I will permit myself one or two brief observations. In past years, each year's Economic Survey has been pessimistic about our increasing productivity. They have always under-estimated the increase. Year after year, they said that 2½ per cent. was to be expected, but we got 5 per cent. or more; and year after year they still budgeted for 2½ per cent. for the following year. That was in the days when increased productivity could have been expected to go into increased consumption.

But the 1951 Survey has been unduly over-optimistic about production. Far from getting the very large figures used just now by the hon. Member for Woking (Mr. Watkinson)—I, as much as he, of course, would like to see them achieved; so would we all—we shall not get this year even the budgeted increase in productivity which the 1951 Economic Survey anticipates.

The right hon. Member for Southport (Mr. R. S. Hudson) and the hon. Member for Woking said some extremely pertinent things on the general question of what are the factors affecting productivity. Certainly, in the ordinary way the sort of homilies which they delivered would have my full support. But we really must face the facts of life, one of which is that that dislocation caused by the re-armament programme has created a totally wrong climate for increasing productivity on any large scale in the factories.

There has been a lot of talk about double-shift working. I agree that that is desirable in the interests of the best utilisation of machinery, but let us face the fact that the double-shift working output per working man shift is always quite substantially lower.

Photo of Mr Malcolm McCorquodale Mr Malcolm McCorquodale , Epsom

I should not like the hon. Member to say that it is always lower, because I could quote any number of cases when that is not true.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

I am grateful to the right hon. Member, and I accept the correction. Of course, nothing is always true in industry and there are always exceptions, but by and large we lose a considerable amount.

Most important of all—and here I advert to the point made by the hon. Member for Woking about the way people are inhibited by the old fears of unemployment and all the rest—the reason above all others—and there are many—why in the last three years we have been getting very sharp increases in productivity, is that the workers have at last begun to believe that full employment has come to stay. One could see the change in atmosphere in the factories from some time in 1949 onwards, when the workers said, "Boys, we can really take the brakes off."

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

But my right hon. Friend the Member for Dunbartonshire, East (Mr. Kirkwood), who has great experience in this matter, will agree that they are not saying that today. They are getting a bit worried because they see factories going on to short time. They see materials running down. They see the stocks in the factories being depleted. They read a lot of speeches about raw material shortages. They will read the speeches we are making here today, and they say, "Maybe we had better be a bit careful not to work ourselves, not necessarily out of a job, but out of full week's work in the week after next." Unless they have worked in these conditions, hon. Members really cannot conceive of the impact within a factory of going on short time.

Photo of Mr Ellis Smith Mr Ellis Smith , Stoke-on-Trent South

It applies on more than one side.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

Even if it happens for only one week in six months, the hangover is colossal. In cities like Coventry or Luton, as soon as one factory goes on short time, this chilliness in the factory climate spreads over the whole system and people begin to say, "We had better not go all out in case we create short time."

What are the facts? I am not being theoretical. Look at the actual figures of productivity, which I have had corrected for seasonal factors as best I can. The right hon. Gentleman said, quite rightly, that the measurements are very difficult matters. I agree, especially if they are taken for short periods, when seasonal factors are involved. As nearly as I can correct the figures for seasonal factors, this is how the index of productivity goes since the beginning of last year. In 1950, the figure for the first quarter was 136. In the second quarter, it was 139; in the third quarter, 141; and in the fourth quarter, 145. In 1951, the figure for the first four months, from January to April, is 143. That is the first drop. The curve is now going down. In 1950, quarter by quarter, the trend was up, up and up. In 1951, it is going down. We may not like that, but we have to deal with the facts as they are.

Then there are problems in machine tools. The Minister said, quite rightly, that his chaps had got in pretty sharp on the United States and put their orders down very quickly. They did awfully well and he has congratulated them, and I join with him. But that does not mean to say that we are going to get the tools. What happened was that the Minister's extremely clever officers stole a march on the American engineering industry. They nipped over there and ordered the machine tools from the American machine tool industry before the American armaments manufacturers had figured out what would be their requirements for machine tools, and so we got our orders put in.

But deliveries have not yet started, and before they have started the American armaments manufacturers have gone screaming to the American Secretary of Defence saying. "We cannot make arms for the American arms programme because you stupidly let these wily British get away with all the machine tools." My right hon. Friend knows very well that although his men have placed the orders, he will have an awful job getting deliveries of those 40 million dollars' worth of machine tools.

What is happening now is this. My right hon. Friend is relying to a substantial extent on the Continental countries for more machine tools to fill up the American gap. But now that the American arms manufacturers have the wind up about their ability to get the machine tools locally, their agents are all over Europe competing very hard with us in the purchase of Continental machine tools and offering all sorts of inducements. including lovely green dollars—green on both sides; "folding money" as they call it—to get German, Italian and French manufacturers to supply America instead of supplying us.

It seems to me that the time has come when we should re-examine the implications of what the Prime Minister said in his speech on 29th January, in which he announced the re-armament programme. Very sensibly, he hedged that programme round with all sorts of reservations. Indeed, his reserve is a measure of the fact—and I take it as support for my argument—that he could not possibly have done all the programming that was necessary. He could not have done it, because there was not time to do it. He gave himself an escape clause, very prudently and very sensibly. What did he say? He said: The completion of the programme in full and in time is dependent upon an adequate supply of materials, components and machine tools. In particular, our plans for expanding capacity depend entirely upon the early provision of machine tools, many of which can only be obtained from abroad.The effort we are making is an integral part of North Atlantic defence, the success of which will depend upon our defence preparations, which in their turn will depend on the mutual availability of machine tools and raw materials. I do not think anyone will dispute, although we would all say it with deep regret, that in practice, so far this year, there has been virtually no "mutual availability of machine tools and raw materials." It is quite clear now, as the Prime Minister, in a later passage of this speech, suggested might be the case, that it might be— impossible to spend this sum within that period."—[OFFICIAL REPORT, 29th January, 1951 Vol. 483, c. 582, 584.] However much one could have based oneself, as an optimistic guess, on the £4,700 million estimate in January of this year, in July, with the experience of the last six months, we ought to realise that the Prime Minister's fears have come about and that it is— impossible to spend this sum within that period. If I may suggest it, with all the respect in the world, now that that is clear, the Prime Minister ought to say so. There ought to be no face saving, and he ought to say that that is now the case. If he had the courage to do that, he would earn the gratitude of millions of people in this country who are plagued by the fear of short-time working in the future and of the rising costs of their purchases in the shops at the present time.

6.1 p.m.

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

I am very much obliged to you, Mr. Deputy-Speaker, for having called me immediately following the very interesting speech to which we have just heard from the hon. Member for Reading, South (Mr. Mikardo). Interesting and able as it was, the hon. Member's speech has left me an absolutely clean wicket to talk about the Select Committee's Report. The case which the hon. Member put was addressed to the hon. Member's Government, and had nothing to do with me.

When I came into the Chamber this afternoon, I was a bit disappointed to see that the right hon. Member for Ebbw Vale (Mr. Bevan) was not in his place and that we might not be able to hear his case. We have now heard it from the hon. Member for Reading, South. No doubt the responsible Minister on the Front Bench will know how to deal with that case at the right time. There are one or two points about it that I should like to mention. One was the very interesting and definite prediction by the hon. Gentleman of a coal crisis next winter. Can we hope that when the crisis happens he and his hon. Friends will remember those words and will not try to blame a lot of other people for what has happened?

The case was based entirely upon a pamphlet which the right hon. Gentleman and his Friends have recently produced. The hon. Gentleman did not mention the Plan for Mutual Aid, which was about the only thing he did not mention. I do not think there is a case for anyone to answer because the great majority of hon. Members of all parties, and the great majority of newspapers, have done nothing for the last three weeks but answer the case which the hon. Gentleman has made.

I know that the hon. Gentleman just does not bother about that. When I pointed out to him a slight twist in one of his quotations and in the conclusions he drew from it, he blandly said "I do not believe it." That is a very nice way out of a difficulty. It is precisely what the rest of the country has said to him and his friends. It has been taken up not only by his own Front Bench but by every independent newspaper throughout the country.

Photo of Mr Ian Mikardo Mr Ian Mikardo , Reading South

I should be very grateful to the hon. Gentleman if he would mention an independent newspaper.

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

We can start with "The Times" and the "Manchester Guardian." The hon. Gentleman must not get me on the wrong tack. I am talking about the purely reputable journals. [An HON. MEMBER: "The 'Daily Express'?"] I have never said that the "Daily Express" was a reputable journal. I would rather not be drawn into this direction, and I should like to get back to the point of this debate, which is the Report of the Select Committee. We have had a delightful digression by the hon. Gentleman, which we all appreciated, but it would be more helpful and for the good of the country that we should discuss this very important Report.

I want to confine myself to one aspect of that Report, the shortage of labour. I am very sorry that there is no representative of the Ministry of Labour on the Front Bench, in view of these recommendations, I am sorry that the Government seem to feel that this is purely a matter for the Ministry of Supply. Time and time again throughout this Report reference is made of the shortage of labour. The Select Committee say that this is one of the most important factors. They characterise the position in regard to machine tools as the most vital factor of all.

The shortage of labour is the most difficult problem which we have to solve. The fallacy in the case which was put by the hon. Member for Reading, South, is that of saying that nothing else will suffer and that there will be no sacrifice anywhere else; everything will go on precisely as before; and no more raw materials are going to be taken from any other place to be allocated to the re-armament programme.

That is not my understanding of the Government's case. That case, as I understand it, is that re-armament is paramount, and that if sacrifices have to be made elsewhere, that must be done. I entirely support my hon. Friend the Member for Woking (Mr. Watkinson) who said he believed that this problem was the most important thing to which the Government have to set themselves for the next three months, or three years, or however long they happen to be in office.

The shortage of labour is much more definite. I believe that machine tools and raw materials can be made available but that in burking or putting off tackling this difficulty of labour shortage, the Government are sowing the seeds of failure for their own programme. I desperately want their programme to succeed, because it is important that it should. If it slows down and comes to a stop, no one in this country, except the right hon. Member for Ebbw Vale and his friends, will be pleased. Certainly, the workers in the country will not be pleased.

If the programme slows down because of shortage of labour, it will bring many unpleasant things. The programme will take much longer, and austerity will be spread over much more time than would otherwise be necessary. The public will not get value for the money they are spending, more people will be working short time, and there will be more redundancy.

I believe that that will eventually mean that the Government will be forced to a most undemocratic and unpleasant way of solving this problem, which is the direction of labour. By refusing to take definite, energetic and difficult steps which must be taken to solve the labour shortage, the Government are, I believe, putting themselves into the position where sooner or later they will have to come to this House and ask for powers to direct labour.

Photo of Mr Ernest Fernyhough Mr Ernest Fernyhough , Jarrow

What are the definite steps which that hon. Gentleman would take to solve the manpower problem in the mining industry?

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

I will answer with great pleasure if the hon. Gentleman will give me a little time. It is what I propose to do—although I am not dealing with the mining industry. The Report is not concerned with the mining industry but with the engineering industry. It would be better if I stuck to that. I deplore the fact that there is no Minister here from the Ministry of Labour. The hon. Gentleman who is on the Front Bench may feel that he is not competent to answer the point that I am making. It is very important that the Government should give this point consideration otherwise they may put themselves sooner or later into the position of being forced to direct labour. If the Minister refuses to ponder upon that unpleasant fact certainly the Trades Union Congress will do so.

This is a difficult and intractable problem, which can be dealt with under two heads. One is the re- distribution of labour and the second is productivity. Both of them have been mentioned by my right hon. Friend the Member for Southport (Mr. R. S. Hudson) and by my hon. Friend the Member for Woking. Perhaps I might deal, first, with the point about re-distribution, which is an unpleasant matter which we must face.

If we are to carry out this re-armament programme and are to get a shift of employment, there will be redundancy in some places and somebody will be out of a job for some little time while he is shifted into another job. When people like myself talk in that way, hon. Members opposite shout that we want unemployment. It is, therefore, very important at this time to point out that if the kind of remark which I have made is to be a pretext for people like the hon. Member for Devonport (Mr. Foot) to launch into one of his charming essays in political veracity in the "Daily Herald" about some Tory having said that he wanted unemployment, then by the same token both the Government and the T.U.C. have said that they want unemployment because they have both said clearly that redundancy must be faced.

The writers of the excellent T.U.C. pamphlet on the trade unions and productivity were, on page 59, quite clearly of the opinion that redundancy was inevitable. They went on to add that it is important to bear in mind that redundancy was not unemployment where full employment existed. That is a very important consideration, because unless we are prepared to face up to redundancy and unless we are prepared to say, "We are sorry, but somebody has to leave the job he is doing and go elsewhere," we shall not fulfil the re- armament programme and we shall be forced to direction of labour.

Surely of the two alternatives a certain amount of redundancy and mobility of labour is infinitely more pleasant and easier to deal with. The engineering industry, and particularly the machine tool industry, is very dangerously undermanned in many places and non-essential industries are greatly over-manned, the most notable of them being the Government, which becomes more and more non-essential every day of the week.

The conclusion is inescapable. If we are to fulfil the re-armament programme and if the Government are really serious, we have to shift 500,000 people somehow and in some way from their present jobs into other jobs, but we have had no indication whatever how the Government propose to go about it. I believe that if they will tackle the problem and trust to the good sense and patriotism of the British working man, they will find that many of the difficulties will be surmounted before they start.

I believe that the T.U.C. can go a long way towards helping solve the problem. The Minister mentioned, very quickly in passing, that somebody had had some discussions with somebody in the trade union movement. I wish someone could be a little more specific. Has this matter been discussed at length with the T.U.C.? Have the T.U.C. been asked to set up an emergency committee to deal with it and to explain the problem to the workers? That ought to be done. It will be a great pity if it is not done.

To quote again from paragraph 38 (iv) of the Report: Short of the introduction of war-time conditions of labour, it is important that steps should be taken to investigate what can be done to remedy the existing serious situation. The evidence is available and it is quite clear. I do not want to labour the point too much, but the Report contains eight specific suggestions each one of which in one small way or another would help to solve the problem. I want to know, the country ought to know and almost certainly the trade union movement ought to know, whether the Goverment propose to do anything about any of these steps. For the record, I should like to itemise them.

First, it is suggested that voluntary machinery should be set up, by all three parties presumably—management, labour and the Government—to guide workers from non- essential jobs to essential ones. The right hon. Gentleman made some reference which led me to believe that that had been done, but it certainly was not clear. If it has been done, I welcome it, but if it has not been done I hope that it will be done. Secondly, it is suggested that the Government should take more steps to ensure a widespread sub-contracting of orders so as to spread the work to the workers instead of having to bring the workers in to new work.

Thirdly, it is suggested that clear directives should be given to the employment exchanges so that they shall be exactly aware of the problem and the part they can play—voluntarily, of course, but a definite part—in solving it. Fourthly, there is the very vexed question of the call-up of apprentices. We should like to know what the Government propose to do about it. I confess that I can see two arguments about it and I should not come down on either side without a great deal more knowledge and expert advice than I have at the moment.

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

I do not think the Committee did. I may be wrong but I did not read that the Committee had made a firm recommendation. They certainly said that it was a subject that the Government ought to investigate and give a view on, and I am saying the same thing.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

Did not the Committee say that the witnesses were unanimous in attacking the system of calling up apprentices?

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

That is probably true but with the best will in the world one must confess that most of the witnesses concerned had a certain selfish interest in the evidence they gave. That is fair. I am not being disrespectful to the people concerned, but there is obviously another side to the matter. If the Government have a plan, what do they propose to do?

Fifth, there was the suggestion that there should be a considerable extension of training schemes. One recalls that in the later years of the war training schemes were set up with considerable success in many industries by the Coalition Government led by my right hon. Friend the Member for Woodford (Mr. Churchill). They were very successful and they were on a wide scale at the end of the war, and it might not be remiss if some of them were set up again.

Sixth, there was the very tricky and difficult problem of upgrading and dilution of skilled grades. If it is absolutely necessary, I cannot believe that the T.U.C. will sit still and say," We will not even discuss the subject," but I do not think anybody should expect the T.U.C. to raise the subject or start doing something about it until the Government urge them to do so. These are difficult matters for the trade union movement, as the hon. Member for Reading, South, knows, probably better than I do. While I cannot believe that the trade union movement will refuse to discuss it or to do anything at all, I can believe that the trade union movement is entitled to sit back and say, "It is up to the Government to say what they want us to do." If the Government have done that, it is certainly a deep dark secret to me, and I should like to be enlightened.

Photo of Mr Frederick Lee Mr Frederick Lee , Newton

The hon. Member should know that this question has been discussed by the Ministry with the N.J.C. and that, as regards engineering, there still exists the relaxation agreement which has never been revoked since the war.

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

I know that we still have the A.E.U. and the E.T.U. agreements—we have had a certain amount of trouble with them—but I do not think that they are in any way comprehensive or sufficiently up to date to deal with our present difficulties. If the Parliamentary Secretary tells me that the Ministry are discussing these matters or have discussed them recently, I am delighted to hear it, but that is not clear from the Report. All I can find from the Report is that the Select Committee think that these things ought to be gone into. Upgrading and dilution are obviously matters which ought to be studied, and I believe that if the T.U.C. were asked by the Government to give a helping hand with the problem great strides could be made.

Seventh, there is the question of tackling shift working, about which there has been a great deal of discussion on both sides of the House. It has been mentioned on both sides generally with approval, and the difficulties have been pointed out. I was amazed to hear the Minister of Supply state that two-shift working is done all over the country on a wide scale and that what is being done in Leeds is common knowledge. According to the Report, it certainly is not common knowledge. If it is common knowledge, it could not have been made very clear to the conscientious and expert members who comprised the Select Committee on Estimates.

One of the questions put in the Report is: How is the system working out at the Royal Ordnance Factory at Leeds? I should very much like to know the answer. I believe the Minister was a little misleading in suggesting that this was all ancient history, that it was all easy and that there was no catch in it. It is very difficult, and I repeat that if the Government expect the trade union movement to co-operate and really knuckle down and take some unpopular steps—for they will be unpopular—it is up to the Government to give a lead and to guide the trade union movement. They cannot expect to sit back and let the trade unions tackle these unpleasant problems.

Eighth—and probably the most unpleasant suggestion of all—was the question of the possible extension of hours. The Report contains eight specific suggestions how the gap in our manpower can be closed. Each of them is a major topic in itself and each is a serious topic which ought to be tackled. I suppose that by the simple law of averages the Government are bound to have done something on some of them, and I should like to know which and what.

The question of the number of people employed in the Government's own offices and the number of people employed on non-essential administrative staffs was dealt with earlier in the debate. I suggest to the Government that if they are to tackle the problem of redundancy, mobility of labour and the shifting of people from one job to, another, there could be no better place to look than among the swollen administrative staffs throughout the country. If they went about the job carefully, I am certain that they could transfer about a quarter of a million civil servants without the rest of the country even knowing they had done it. It would be one way of solving a painful problem.

But again, I say that the problem is not as difficult as it appears at first sight, because I believe that the good sense and patriotism of the British worker is sufficient to make him swallow most of the unpleasantness that a change in his job might bring to him. The remarkable thing is that if these people were shifted from clerical and administrative grades, trained, and put into the engineering industry, the majority of them would be earning better wages than before. That is a real incentive which ought to be pointed out to the workers before asking them to do something which at first sight appears a rather unpleasant upheaval.

Turning to productivity, I want to refer briefly to the reports. The Government set up the Anglo-American Council of Productivity. We had a vast amount of official ballyhoo and publicity; we had a vast amount of work by a lot of excellent, hard-working people on both sides of industry; but I confess quite frankly —it may be my ignorance—that the results are a deep, dark secret for me. I have read many interesting reports but I have yet to hear that anybody has done anything about any of them—

Photo of Mr Ian Orr-Ewing Mr Ian Orr-Ewing , Weston-Super-Mare

Mr. Ian L. Orr-Ewing (Weston-super- Mare) indicated dissent.

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

My hon. Friend disagrees. I am delighted to note that, but I repeat that I have seen few signs that much has been done, and so far as the excellent document about labour restrictive practices is concerned, I do not believe that anything has been done.

I am in a strong position today because it is only a few days since I said some rather rude things from this same position about the restrictive practices of management. In the context of this debate I believe that he restrictive practices of labour are one of the gravest problems we have to tackle. It was estimated a short time ago that labour restrictive practices are accounting at the moment for the loss of about £1,000 million of goods per annum, or about 10 per cent. of our total production. I know that the engineering industries are at the best end of the scale as regards restrictive practices, but it is an unhappy fact that the industries at the worst end are, by and large, those whose restrictive practices and costs influence all the others.

I do not want to go into detail, because it is outside the scope of this debate, but restrictive practices at the docks, on the railways and in the building industry are three typical examples. Their costs and wastage are passed on to the cost of every other commodity concerned in the rearmament programme in the cost of living. or anything else one might mention. I feel strongly that it is time the Government paid something more than lip-service to the reports of the Productivity Council. At public dinners the Government are really red-hot when it somes to productivity. Ply Ministers with capitalistic cigars and they will talk about productivity half the night, but unfortunately the results are discouraging.

Photo of Mr Frederick Lee Mr Frederick Lee , Newton

Perhaps the hon. Gentleman will tell us what productivity increases we have had in this country since the war in contrast with other countries?

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

There is no need to do that, because while the hon. Gentleman was out, if he will forgive me, figures were given adequately by previous speakers. I know perfectly well that we have had great increases in productivity. The remarkable thing is that just as the Anglo-American Council of Productivity gets under way, the increases in productivity seem to have come to a full stop. I should not think there is any connection between the two facts but it is most odd.

Photo of Mr Joseph Slater Mr Joseph Slater , Sedgefield

Is the hon. Member inferring that the reason for the drop in productivity is because men in industry are restricting their labour? If so, then the speech he is now making, as well as that made by my hon. Friend the Member for Reading, South (Mr. Mikardo), on this matter, will not go down well with the workers in industry?

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

I have no doubt that I shall be criticised by some people who will resent what I am saying, but I believe it to be true. I do not exonerate management because it has many things to answer for, but in the context of this debate I say that the restrictive practices of labour are far and away the most important and difficult problem. As I said about the redistribution of labour, if the Government expect the T.U.C. to go to their constituent unions and say, "Look boys, something has to be done about this," then the Government must give a lead. They cannot simply sit back and say it is up to the trade union movement.

I should have thought that the pamphlet to which I have referred had sounded the death knell of restrictive practices throughout the industry. On page after page we find trade union leaders—all of them respected, experienced men—making statements that any trade union member could accept at their face value as being sound. On page 5 they state that the real problem confronting the unions is to increase productivity. On page 11 they point out that one of the reasons for the higher standard of living in the United States is that there is no serious opposition to new machinery and new methods. On page 30 they point out that another reason is that American unions have no limits or restrictions about the number of machines which any one man can tend. Finally, they state at the end of the report on page 52 that the lack of union restrictive practices is a major contribution to American productivity and, further, that employment is increased by not imposing restraint. I should have thought that was the last nail in the coffin of restrictive practices.

Those are all statements made, signed, sealed and delivered in a T.U.C. pamphlet. These men have given an excellent lead. Surely it is clear that increased productivity alone could go a long way towards solving the problem of the Government. If they will tackle this problem of restrictive practices; if they will sit down wtih the trade unions, take off their coats, and say that something must be done, that would be one way of making up much of the shortage of labour.

If they will tackle that, and the delicate question of redundancy and the re-distribution of labour, then they can make up the gap of half a million men. If they do that, they can succeed in carrying out this programme. If they do not tackle either of these things energetically, then the programme will come to a full stop as sure as fate, and according to the evidence of the Committee. If the programme comes to a full stop, it means grave and disastrous consequences. If those occur, the responsibility will lie squarely on the shoulders of the Government and on no one else.

6.29 p.m.

Photo of Sir Austen Albu Sir Austen Albu , Edmonton

I have a feeling that the hon. Baronet the Member for Abingdon (Sir R. Glyn), who plays such a distinguished part in the proceedings of the Estimates Committee, must be disappointed with our progress in this debate so far on the Report on our rearmament programme. Perhaps the hon. Member for Somerset, North (Mr. Leather), has kept closer to the subject matter of the debate than anybody else, although he spoiled his speech at the end by adopting the view that the workers alone were responsible for what he considered the insufficient rise in the level of production.

Photo of Mr Edwin Leather Mr Edwin Leather , Somerset North

The major responsibility, I said.

Photo of Sir Austen Albu Sir Austen Albu , Edmonton

I think it is impossible to separate the attitude of workers from the outlook of management. Some of the speeches we have heard from the other side are extraordinary if we examine what has in fact taken place in industry and what the Government have done to increase productivity, as well as the dropping of many restrictive practices by the trade unions during and since the war.

I want to deal with quite another aspect of the Report and of the re-armament programme. I do not intend to follow or attempt to reply to my hon. Friend the Member for Reading, South (Mr. Mikardo), who filled the House for his speech. It was an attack on the policy of His Majesty's Government, and when such an attack is made it is always easy to fill the House, particularly if the speaker happens to be on the Government side. He supported his speech with a mass of statistics and with his usual wit.

I am going to assume for the purposes of my speech that the size of the rearmament programme is the correct one, and that the criticisms and suggestions made by the Estimates Committee are on the details of that programme. I believe it is possible to achieve the present level of re-armament if the raw materials are available, which I believe they will be, and if we can increase our output from the existing labour and plant. In these discussions we normally take into account labour, materials, plant and machinery. But there is also another factor which I do not think has been sufficiently discussed or considered, and that is the development of what might be termed manufacturing "know how." I hate some of these American expressions, but in this case manufacturing "know how" explains best what I mean, and what I am going to talk about.

The Report of the Estimates Committee draws attention to one major problem, the supply of machine tools of the right type and in the right quantity. There are some types of heavy machine tool, such as those used in ship building and tank manufacture, which are very difficult to obtain, or for which delivery is long, which means, of course, that special arrangements must be made for them. This is a problem about which the Government are most seriously concerned, but if our engineering exports are to be maintained, as they must be if we are to maintain our balance of payments, there will be a growing need for machine tools of every type. On the subject of machine tools, the Committee's Report on page 16 says: It is, however, the view of the industry itself that methods other than the physical expansion of capacity should be found in order to effect a general increase in production. The two chief methods would be first, the more economical use of existing machine tools and tools produced by existing capacity, and, secondly, the use of sub-contracting on the part of the major producers of machine tools. I would add a third, and that is that machine tools that are bought for Government Departments, on behalf of Government Departments or by contractors should be ordered with only such equipment as is needed. Sir Alfred Herbert recently has—and this is not a new line for him, because he has said it many times before—drawn attention to the fact that insufficient thought was often given to the limited range of work which machine tools are called upon to perform, I myself think that the machine tool industry is to a certain extent to blame for this.

In the past, there has been a far too great salesmanship of gadgets and developments of machine tools which manufacturers have bought but have not required. The result, of course, has been that machine tools take longer to make and are more expensive to buy. Large numbers of lathes are sold with screw-cutting lead screws, which are never used. Many universal milling machines are sold where plain milling machines would do just as well. Frequently, I believe, all-geared machines are used where they are not required. A good deal could be saved by simplifying the types of machine tools which are produced in industry.

Photo of Mr Peter Roberts Mr Peter Roberts , Sheffield, Heeley

Is the hon. Gentleman criticising the Government or the ordnance factories, in that in the ordering of these machines no thought is given to their efficiency or to expansive work, or is he suggesting that the contractors, who are trying to do a job and earn a profit, are going to buy expensive machine tools for which they have no use? I should like to know whether he is directing his argument to the Government and the Ministry of Supply, or to the industry generally.

Photo of Sir Austen Albu Sir Austen Albu , Edmonton

All those concerned with the manufacture of armaments, equally the Ministry of Supply, the Admiralty, the contractors and also the British tool manufacturers, sometimes over-complicate their machines so that it is not possible to buy the simple machines which are needed. I am prepared to rely on the argument of Sir Alfred Herbert, who probably knows more about this subject than anybody else in the country.

The Report draws attention to the need for shift working, overtime and dilution, subjects which have already been touched on in this debate. The trade unions will co-operate in all these matters, as they are already doing. The right hon. Member for Southport (Mr. R. S. Hudson), however, seemed to think that in some way by the use of these methods it should not be necessary to build so many factories. But one of the objects of the armament programme is the establishment of plant and machinery which would be available in case of war and not necessarily for immediate use. I should have thought that the creation of a reserve capacity for armament production was as important as the creation of arms themselves, particularly if one takes into account the rapidly changing developments in modern weapons. But the right hon. Gentleman's arguments assume that labour is available.

It is necessary to do everything that is possible to improve methods of production which will save labour and machine time. Hon. Members have referred to better planning and production management. I believe that one of the main causes of the very rapid increase in production in this country, particularly in the engineering industry, of the last few years has been the great attention that has been paid—and I think that hon. Members opposite should give credit to the Government for this, because they have made great efforts in connection with it—to production and management methods generally.

I should have thought that the attitude of labour was determined by better organisation of work in the workshops, and by better management methods. Where that sort of thing exists it is generally found that restrictive practices fall to the ground, since there follows co-operation between management and labour and the proper planning of work which insures a continual flow. These are major factors in productivity increase.

Another matter to which far too little attention is given today is research into manufacturing methods, particularly in the metal forming and other material forming processes which are so important in armament production. It is necessary to do this sort of research not only in order to produce the equipment that we want now, but to insure that as new designs come forward—especially if there should be a war, for there is rapid development of weapon design during a war—factories can be quickly switched over to full-scale production of the new weapons. This often has to take place in firms without experience of that class of work.

A rather interesting article recently appeared in "The Engineer" by Dr. Galloway, the Director of the Production Engineering Research Association, in which he said: Only by developing basic production techniques in advance of the needs of the armaments factories is it possible to avoid the costly process of developing techniques by protracted trial and error on the production side, a process which not only gives rise to considerable waste of time, labour and materials, but which frequently fails to develop the best techniques. An example of the failure to develop a manufacturing technique parallel with the development of design is the problem of that machining of nimonic alloys used in jet engine manufacture. I do not know whether it has yet been fully solved in this country or not, but the expense and importance of it can be seen by the fact that if there were a war we would probably need something like 5 million turbine and compressor blades every month, and the problem of machining these blades is a very serious one.

An example of how time can be saved is in the machining of dies used in the manufacture of bullets. These dies are made of a very special hard material and, by research into their methods of manufacture, their machining time was reduced from 24 to 7½ minutes—the cost was halved, with an immediate saving of £5,000. Instead of two lathes being used, they are now made on one capstan and, with further research, the entire requirements of this vital item in wartime could be turned out on one standard automatic machine. That was at the cost of about £200 in special research into the method of manufacture.

In the United States far more work is going on on these lines than in this country. There experiments are going on to substitute a cold extrusion process for the usual forging and machining in the manufacture of shells. I do not know if similar experiments are going on in Royal Ordnance Factories. I am told that such a process would have saved us 960,000 tons of steel in the last war, in addition to a great saving of labour and machine time. In fact a very small sum now spent on this sort of work would make a great saving in the future.

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

The hon. Member has praised the Americans for research. Would he not give British industry some credit? Surely he recognises that industry will not broadcast details of research carried out within each organisation and association. I think that if he brought himself up to date he would find we also have been imaginative.

Photo of Sir Austen Albu Sir Austen Albu , Edmonton

I think that a most extraordinary statement by the hon. and gallant Member. He has said that British firms develop new methods of manufacture of armaments and will not share them among their competitors.

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

I did not. I did not say anything of the kind. I do not think the hon. Member wished to misrepresent me. What I meant was that they would not broadcast or make them known to foreign powers, but certainly they make them known in their own industries.

Photo of Sir Austen Albu Sir Austen Albu , Edmonton

I should think it extremely difficult to avoid foreigners knowing of them. I am not referring to new developments in design of jet engines and so forth, but to manufacturing methods on new materials. There is far more research of that kind going on in America than in this country.

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

The hon. Member did refer to turbine blades for jets, and I doubt whether he or anyone in this House is fully conversant with modern practice. I think he must leave that point open.

Photo of Sir Austen Albu Sir Austen Albu , Edmonton

If the hon. and gallant Member had heard me, he would have known that I said that I did not know what the present position was. What I said was that there had been a loss of time because we did not develop, parallel with the design and with the new materials, methods of machining, and that if we had done research on methods of machining while doing the work on design and new materials we would have saved a lot of time. I followed it up by saying that I was not certain and did not know what the position was today in regard to jet turbine blades, and I am prepared to accept from the hon. and gallant Member that the present position is satisfactory.

I was referring to what took place at the time of the developments of these items, and I was saying that with all these new weapons and materials we need far more research on machining than has taken place in the past. We do not want to have to work out the correct cutting tools, angles and lubricants and so on parallel with getting the thing on to the factory floor, when a lot of this work could be done by means of research beforehand. Only in the last four or five years in this country have we set up a production engineering research organisation. It is doing exceedingly valuable work, but only a few firms themselves carry on any research of this nature here, although it is carried on by a large number of firms in the United States.

Photo of Mr Ian Orr-Ewing Mr Ian Orr-Ewing , Weston-Super-Mare

When the hon. Member speaks of little research of that kind going on, he is not trying to tell the country that nothing is being done by firms merely because there is not a great deal of publicity? I am sure we would not wish to mislead the House into thinking that because that is being done by small firms and not by large organisations in this country it is not being done at all. I can assure him that he is very out of date if he thinks no trials are being carried out in regard to alloys and metals and so on.

Photo of Sir Austen Albu Sir Austen Albu , Edmonton

I am sorry, but I still believe that to no large extent is research carried on in machining and manufacturing methods. I am prepared to admit, of course, that every manufacturer in his day-to-day manufacture and production carries out on the shop floor experiments and changes his technique and so on which lead to better manufacturing methods. I think the hon. Member has misunderstood my case. My case is that what we need to develop is research not on the factory floor and mixed up with manufacturing but removed from the factory floor. The hon. Member's information and my own do not agree. I shall be pleased to see him afterwards and to hear of any firms which are carrying out experimental work on machining of new metals in their own organisations.

Photo of Mr Ian Orr-Ewing Mr Ian Orr-Ewing , Weston-Super-Mare

I could not understand the hon. Members argument. Will he explain why it is better to set up a separate type of establishment to try out new materials and new methods quite apart from the field of industry itself? We have always found in the engineering industry that the chaps who know how to do the job are those best able to carry it out, and I still believe that is the best way to do it. It may be that the Government have within their knowledge certain specialised alloys and metals not yet released to industry, but industry does the job very well with materials about which it knows.

Photo of Sir Austen Albu Sir Austen Albu , Edmonton

The hon. Member should not be so suspicious of my intentions. I am not arguing that the Government have special knowledge or should set up a special body. This is an association set up and supported by industry and, in fact, industry are paying more money to it than the Government. I am suggesting that it is a body which needs to be encouraged. I agree that many firms and the Royal Ordnance Factories and the new mechanical engineering research establishment in Scotland are all bodies which might participate in this type of research, but I am saying that there is a difference in the results between doing research under controlled conditions and with statistical analysis and the sort ofad hocresults of work done on the shop floor. I cannot agree with the hon. Gentleman that the best results are always attained by the man on the shop floor, who must inevitably be limited in the plant and equipment that is available to him and in the knowledge he has, which is restricted to his own trade.

There is a very good case to be made for doing serious manufacturing research in special establishments or special departments of firms, if they are willing to set them up. I certainly do not mind where it is done, but the Production Engineering Research Association is the only organisation of its kind in the country, and I suggest to the Government that they might well consider whether it would be advisable to give further encouragement to that body, perhaps even a contract to do a certain amount of research which would prepare the ground for the future. A vast number of new materials and new problems always emerge when there is a rearmament programme of this size.

I believe that if that were done it would build up what I might call a "stockpile" of manufacturing know- how that would be very necessary if we got into a position of having to make an even more rapid expansion of weapon development and armament manufacture by firms without previous experience. I believe that by quite a small expenditure we could provide an extraordinarily useful reserve of knowledge which could be called upon if ever we needed to use it.

6.51 p.m.

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

I am glad to follow the hon. Member for Edmonton (Mr. Albu). I know that he has considerable experience in the matters which he has been discussing, but I think that he is out of touch with the practical side of industry. I wish to declare my interest in the aircraft industry. I think it is known to the House, but I make a point of declaring my interest in making any speech on the subject.

Perhaps I have not the hon. Member's theoretical knowledge but in the aircraft industry, with which I am connected, great experiments are being conducted. They are made known to other companies in this country but they are not published in the technical journals, where they could get over to the Iron Curtain countries; but I assure the hon. Member that progress is being made, that we are not lacking in the design or manufacture of jets or even of aircraft. I wish there were more of them, and that orders were being placed more quickly, but that is another point.

I was impressed by the speech of the hon. Member for Reading, South (Mr. Mikardo). I thought he really damned the Government. I hope that many of the things that he said will be said in the autumn when the political talks will perhaps become more intense. I shall certainly quote much of what the hon. Member said today. We listened to him with great interest. We know that he spoke more often in the earlier days of the last Parliament on the great achievements of the Labour Government and the Labour Party. He has been speaking in an entirely different way this evening.

The hon. Member referred to coal, and said that his great concern was whether there would be sufficient coal to carry out the re-armament programme. Only this afternoon some of us on this side of the House put Questions to the Minister of Fuel and Power on whether he intended to purchase coal from the United States in the coming winter. We received a most vague reply—that it was under active consideration or that the Minister was thinking about it, or something of that kind. Here we are, towards the end of July, and the Government are not at all clear in their minds whether they will buy coal from America or not. If there is to be a fuel crisis, the question of purchasing coal from the United States should have been considered weeks ago, and not left until the late summer or early autumn before the Government make up their minds.

We have to decide whether this rearmament programme is really necessary. Most of us—there are perhaps one or two exceptions—think that it is necessary if only as an insurance policy. Even if we never have a war, which none of us wants, it would be cheap at the price to manufacture these armaments, aircraft and tanks. If they are never used, it will be a very cheap insurance policy for this or any other country in the free world.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

if that is the argument of the hon. and gallant Member, does he object to Russia piling up armaments as an insurance for peace on her side?

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

We are now hearing the voice of Moscow. Russia has been piling up armaments during and since the war. The Foreign Secretary said during the weekend—it was the only sensible thing he did say—that we had disarmed too quickly. He was right. This country had practically no armaments four years ago. The hon. Member may sigh, but that is a fact. He knows how demobilisation was carried out, how factories were run down, how little was being made and how much of our surpluses of materials were sold to foreign Powers and broken up for scrap instead of being put into safe custody and keeping in case we needed them. Aircraft and other equipment were melted down—

Photo of Mr Archibald Manuel Mr Archibald Manuel , Central Ayrshire

The hon. and gallant Member has referred to demobilisation. I remember quite vividly the Leader of the Opposition criticising the Government because they were not demobilising quickly enough.

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

I have often heard that argument but my right hon. Friend made perfectly clear and laid down figures which he thought ought to be achieved in demobilisation. I do not carry the figures in my head but they are in the OFFICIAL REPORT.

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

We are supposed to be discussing the Third Report from the Select Committee on Estimates.

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

I beg your pardon, Mr. Speaker. I was diverted by the hon. Member for Ayrshire, Central (Mr. Manuel). It was not my intention to discuss demobilisation.

In dealing with the Select Committee's Report, we must decide whether rearmament is necessary. Most of us think that it is. The Prime Minister thinks it is, and so do most of his right hon. and hon. Friends. But I believe that just at this period they are hoping, and have been hoping for the past six months, that some sort of peace will come about before the autumn, an agreement which would perhaps enable them to refrain from going right into full production on this programme, so that at a convenient time they might be able to reduce it or scale it down.

Either we have a re-armament programme or not. If it is necessary it is vital to proceed with it with the utmost haste to ensure that we are adequately armed. We cannot have half measures once we have decided on the programme. That is the weakness of the Government. My view is that in the aircraft industry the difficulties of manpower are, taken by and large, greater than raw materials difficulties. The main difficulty is that of housing. I am sure that the hon. Member for Ayrshire, South (Mr. Emrys Hughes), will appreciate that point. Unless men can be moved about the country from non-essential industry into the industries where they are required, we shall not get the workers who are needed.

A difficulty is that many small firms who are sub-contractors are paying, and are able to pay, higher rates for the job than the main contractor who is supplying the Government. That is also the case with some American firms which have recently been established in this country and which are paying much higher rates than the agreed rates in industry here. The Government should do something to try to regularise this position. If a firm is given a contract and has to sub-contract, say, 25 per cent. or 30 per cent., it should be laid down that an agreed rate should be adhered to through the trade associations or some other bodies to avoid bidding up to entice labour from the parent firm. Otherwise the whole job will break down.

I should like an assurance from the right hon. Gentleman whether or not he will have sufficient jet engines for the airframes in 18 months' or two years' time. because I have grave doubts on that score. I think we shall have many more airframes than jet engines. It is up to the Government at this stage to make a decision—it may be a wrong one—either to cut down the number of airframes or make more jets. Something must be done, otherwise the programme will be out of balance.

There is a lack of co-ordination in the Government Departments. It is found that if the Navy require equipment they place orders far quicker than, for example, the Royal Air Force through the Ministry of Supply. They seem to know what they want and they get the orders placed. I do not want to go into too much detail, but I should like to refer to the question of Transport aircraft. Aircraft firms have jigs and tools to manufacture this type of equipment, but in a matter of a few weeks, or a month or two, not a single transport aircraft will be manufactured in the country. To me it seems deplorable that when we move one brigade of airborne troops from Britain to Cyprus they have to go by sea. With shortage of manpower the essence is movement and speed. We must get the most out of our men by transporting them rapidly instead of letting them spend weeks in ships going from A to B.

There is the question of the Brabazon aircraft. The right hon. Gentleman has very kindly invited me to fly in it with him the day after tomorrow, and I have accepted. I am much looking forward to the experience. But is this a project which should be continued? He said at Question Time the other day that something like 75 draughtsmen were employed on that project. Seventy-five draughtsmen could find far more useful work than working on the Brabazon.

I am not belittling what is a great engineering feat. It is a great achievement on the part of the designers, and all those who constructed it, but the necessity for re-armament means that draughtsmen and others concerned should be working on something more urgent than on what, after all, may be a luxury air-liner. Although the right hon. Gentleman is always saying that other firms get great benefit from this type of construction, I have yet to know of one firm which has had any benefit from the aeronautical design or the research.

I want to refer to the electronic side of our re-armament programme. The whole success of re-armament depends on whether or not we succeed in making sufficient of the right type of electronics. I think that is generally agreed. Unless these matters are dovetailed, the whole programme can fall down quite easily. The Minister of Supply has given various assurances to industry. I am sorry I missed part of his speech today, but I heard him at an industry luncheon a few months ago. It was not a very happy luncheon. I was rather sorry that a certain incident took place.

On that ocasion, he gave an assurance that there was no question of allowing the electronics industry to lag behind or suffer for want of work. Reference was made to redundant workers, and the Minister said that he would see that they were fully employed. Today he said he would take up the slack in the radio industry caused by the increase in Purchase Tax. I do not think that this will be achieved at all. The industry has got development contracts, but development contracts take a long while to carry out. They always take longer than the estimated period. We say a year, it is probably two years. If one estimates one year, they probably take two. They have got contracts for a small number of complicated equipments.

The designs are complete, and the equipment is being manufactured, but there are no contracts, as far as I know, for mass production units. That is the type of equipment that can be manufactured by the labour—particularly female labour—which is already working in the radio industry. That is because the contracts are slow in being placed. Very slow indeed.

On the valve side, I think that is vital to the whole of the re-armament industry. I will not, for obvious reasons, go into any detail at all, but the Report refers to the special type of valves. I beg the right hon. Gentleman to give this matter his full personal attention, and to see that these valves are made in this country in sufficient numbers for our own requirements so that we shall not be dependent in any way, unless he can come to a very equitable arrangement with our American friends. I beg of him to see we are entirely self-supporting in this one item of re-armament.

On the question of raw materials, here again the Government do not seem to have a clue about what is going on today. Most firms, particularly smaller ones, have a buyer in a motor car touring the North Midlands. They are now up in Scotland looking for steel. They are buying steel from scrap merchants at very high prices. If they did not do that, it would mean standing off their workers. Surely, they ought to be given more assistance and guidance. Priorities ought to be brought into effect.

I ask the right hon. Gentleman whether firms who have large contracts for re-armament are being given every assistance where they want to enlarge their factories. I was told by one aircraft contractor recently that he had to go through 17 different Departments to get permission to enlarge his factory. It was quite a small addition to this factory. Surely, there must be some organisation that could be set up to deal with the matter promptly to enable them to get on with the job. I will give him the name of the firm after the debate so that he can look into the matter.

If this re-armament programme is to be achieved, sacrifices must be made by everybody in the country. It is quite impossible to offer a welfare State in its true form and, at the same time, have a fully armed country ready to take on any adversary. I do not think it can be done. I believe the re-armament programme can be achieved without great suffering provided that there is leadership and guidance from the Government of the day and that we cut out waste of time and do not have firms working three or four days a week. Arrangements should be made for supplies to be available to enable firms to work a full working week. We must make the best use of our labour force.

What about countries such as Holland and Belgium? I note that you are wondering whether I am in order, Mr. Speaker, but it is part of the re-armament programme because we are supplying Holland and Belgium with military equipment that has to be made here. We believe that those countries could make a contribution themselves if they were allowed to do so. I ask the Minister to go into all these points and to put more vigour into the programme, to cut out waste and to see that the firms concerned get the materials. Then I believe that the programme will be achieved.

7.8 p.m.

Photo of Mr Edgar Granville Mr Edgar Granville , Eye

The hon. and gallant Gentleman the Member for Macclesfield (Air Commodore Harvey) has raised a number of extremely interesting and important points, all of them related to the subject under discussion and to this Third Report. I am sure that he will forgive me if I do not follow his argument in regard to the Brabazon and for more transport aircraft. I was glad that he emphasised the problem of housing.

In this extremely difficult problem of re-arming this country and dovetailing the work into so-called peace- time industry, one of the most important factors that any planner has to take into consideration is the availability of satisfactory houses somewhere in which the workers can live in comfort. In the old days the Government sent the orders to where the factory was, and now perhaps the orders may have to be taken where the houses are. It is no good thinking in terms of prefabricated houses and makeshift accommodation. They must be housed properly today.

I was glad that the hon. and gallant Gentleman referred to jet engines. There is pertinent reference to that subject in the Report of the Select Committee. I hope that we shall be given an assurance that production of jet engines will not fall behind the programme, and that it will be possible to improve this vital engine production capacity so that we do not have airframes waiting for engines.

The hon. Member for Edmonton (Mr. Albu) appeared to be very worried and anxious about technical research and development in relation to the re-armament programme. Reference has been made to it in many places in the Committee's very interesting Report, but I am sure that the Minister of Supply could tell the hon. Gentleman that a great deal of research and technical development has been going on ever since 1945. Much of it went on in certain Government institutions very much under the control of the right hon. Gentleman, and then, no doubt when the programme had to be accelerated, it was telescoped and spread over into industry itself. In fact, the Ministry delegated a great deal of this research on machine tools and metallurgical research to the actual aircraft and engineering industries, with the result that the Government today are able to utilise this very important work in implementing the large scale rearmament programme today.

The hon. Member for Reading, South (Mr. Mikardo) introduced the "One Way Only" argument into the debate. Up to then we had had a very quiet and subdued debate, opened with what was a nonparty speech by the right hon. Member for Southport (Mr. R. S. Hudson), which was followed by a very informative, quiet and uncontroversial speech by the Minister. It looked as though the rest of the debate, following the speech of the hon. Member for Reading, South, would be on "One Way Only," and I have no doubt that if certain hon. Members catch your eye, Mr. Speaker, we shall return to that subject.

So now we have had the "One Way Only" case put to us by the hon. Member for Reading, South, at last. He asks whether this programme is necessary and whether we can in fact carry it out. On the question whether it is necessary or not, I should have thought that that was a question for Cabinet to decide. It is a question of foreign policy, of our commitments under the United Nations, and of our arrangement under the North Atlantic Pact. If it is the considered opinion of His Majesty's Government, in full possession of all the facts—and that is important—of which this House cannot be in possession, that this re- armament programme is necessary six years after the war, then I think that they have no other resort, having submitted their arguments to this House, than to initiate and carry out this programme.

The question whether it can be carried out or not depends upon a number of things. It depends, as is stated in this Report, on the labour and materials available, on whether we can, in fact, dovetail a re- armament programme of this size without war time controls into a fully occupied normal industry. I think the right hon. Gentleman the Member for Woodford (Mr. Churchill), in one of his books, once said that this country never prepared for war until it was engaged in one, and I remember that, during the war, he said that in the first year we should get nothing, in the second a mere trickle, in the third quite a good flow, and in the fourth more than we could use.

The right hon. Gentleman the Member for Southport has said that we have 250,000 fewer people at work on rearmament today than in 1939, but in 1939 we were at the culmination of our re-armament programme of that time, in which a great number of workers had been encouraged to go into these industries. I think it is rather unfair to compare that period with the commencement of the re-armament programme which was announced some time ago.

Of course, the whole question whether, maintaining the welfare State and our export trade, we can at the same time, carry out this enormous programme of re-armament, has yet to be determined, and we shall not know the answer for some time to come. But let me emphasise that this programme must be elastic. If by any chance there were a genuine improvement in the international situation, the Government must be left with the responsibility, and there must be that discretion in the hands of the Government, of saying whether or not we should slow down certain things or whether others should be accelerated.

There was originally something which I think was called the ten years' rule, but I think it was abolished in 1933. Today the Government, rightly or wrongly, have commenced this policy of re-armament and have assumed that these armaments are required. So re-armament plans must be elastic; the Government must have, over the whole range of industry, the right to say where the materials shall be allocated—to tanks, aircraft or to export orders. Only the Government can determine day-to-day policy, and, in fact, the hon. Member for Reading, South, himself quoted this afternoon the very fair statement made by the Prime Minister that the programme will of course depend upon the raw materials being available.

On this question of raw materials, I should like to ask the right hon. Gentleman a question. I think he has done a good job of work on machine tools, contrary to the opinion expressed on his own side by his hon. Friend the Member for Edmonton (Mr. Albu). Can he give us some assurance that he is reasonably satisfied that materials will be available at each stage of this programme at the time when they are required? A conference sitting in Washington dealing with this matter, on which Lord Knollys is the representative of this country is discussing vital raw materials now in short supply.

The consumer goods industry of the United States has got to make its contribution to this problem. If we are to ask the home domestic industries in this country to cut down their production and if they are to be denied raw materials to a certain extent not only for export but in order to carry out our re-armament programme it is only fair that members of the United Nations, and particularly the United States, should make some cuts in their use of raw materials, as consumers of domestic industry in this country will have to do. I hope the right hon. Gentleman, when he replies, will be able to tell us that he is reasonably satisfied that, as this programme develops, the vital raw materials which have been in short supply will be made available on an equal basis of fair shares between members of the United Nations.

I was a little disappointed that the Minister was unable to tell us anything about the standardisation of engineering measurements. I should have thought that, in the long run, if we are to have a United Nations policy of a permanent international police force, the Government sooner or later will have to take the cold plunge and take a bold step forward in regard to this standardisation of equipment. I believe that in the last war 5,000 man-hours were required for the conversion of American projects to British use, thereby costing time, money and great inconvenience. Those of us who advocate world government would regard it as a great advance if the Minister will put into operation the plan that can be carried out regarding the standardisation of equipment and engineering measurements.

Finally, the hon. Member for Woking (Mr. Watkinson) referred to the problem of productivity and co- operation between management and workers. I think this is entirely a question of management. I agree with the Minister of Supply about this. The initiative must come from enlightened management it cannot come from the shop foremen or shop stewards, no matter how well organised they may be. The hon. Gentleman also said there ought to be a sense of greater urgency about the re-armament programme. I think a great deal of preliminary work has already been carried out with regard to this, and merely to say that we must have a sense of greater urgency, without at the same time saying how that is to be brought about, does not get us much farther.

I do not believe that we can get desired results any more merely by going to the microphone and appealing to the people, as the Americans say, to pull themselves that the emotional call to the people by up by their shoestrings. I do not believe a powerful national figure really affects production one iota. The re-armament programme can only be kept going according to plan by precision planning at industrial level, by getting the people on all sides of industry to co-operate, to increase productivity and by making the materials available, whilst maintaining a healthy population.

7.22 p.m.

Photo of Mr Alexander Anderson Mr Alexander Anderson , Motherwell

I do not propose to follow what has been said by the last two speakers because I have neither the close connection with industry of the hon. and gallant Member for Macclesfield (Air Commodore Harvey) or the Liberal outlook of the hon. Member for Eye (Mr. Granville). However, I am very glad to have this opportunity to say something about the Report of the Estimates Committee. Those of us who work on that Committee —I have the honour to be its Chairman—often think that the House seldom notes our reports. Therefore, it has been a great pleasure today to hear the Minister of Supply pay a tribute to the Chairman of the Sub-Committee responsible for producing this Report, the hon. Member for Abingdon (Sir R. Glyn), whose energy and clear thinking are only equalled by his public spirit which rises above self and party when it comes to the work of the Estimates Committee.

This Report is a non-party Report. The one thing which we on the Estimates Committee try to avoid is anything in the nature of a party spirit. We try to approach any task given to us by the House of Commons in a judicial manner. I am very glad indeed that this debate has taken such a course and the Government have not adopted this Report as a bolster, as something on which they can lie back instead of getting on with the job, and that the Opposition have not used it as something with which to belabour the Government.

Another point worth making is that it is not for us on the Estimates Committee to decide whether re- armament is wise or not. We are not allowed to interfere with policy. One of the things we have to decide is simply whether the Government's spending of money in a certain direction is wisely done. The object involved is a matter of policy, and that is the responsibility of the Government. Sometimes we have very great difficulty indeed in steering between the Scylla of policy and the Charybdis of security.

I wish to say how very indebted we are to those who gave evidence before us. The Departments themselves were exceedingly helpful. They did not stonewall; they readily gave us their help. In the same way we did not find from industry the carping spirit of criticism, but a realisation that this was a task which required the best energies of everybody in the country if it was to be accomplished without a disastrous dislocation of our whole economy which might have repercussions on our people in the future.

There are three things on which I wish to say a word or two. The first is that the policy of re-armament must stand or fall first and foremost on the supply of materials. One of the consequences of even a whisper about re-armament is an immediate rise in world prices and the stockpiling of vital materials by the wealthier countries. This country is no longer one of the very wealthy countries.

From the evidence put before us there did not seem to be a great deal of alarm regarding the securing of the necessary raw materials, though it was recognised that there might be considerable difficulty. I feel that there was, perhaps, not a sufficient realisation of the fact that while scarce materials for re-armament might be secured in adequate quantities, there was the possibility of repercussions upon other industries which might have a considerable social effect.

Let me give the House one example in my own constituency, which is a coal and steel area. It had a completely lopsided economy. It wallowed between boom in war-time and slump in peacetime. During the last 10 years, a number of new industries have been injected into the area. They are completely different from the old industries. Many of them use scarce materials, and materials vitally important to the re- armament drive. These industries have been painfully built up. They have given new life to my area. They have employed a secondary type of labour which was no longer fitted for the heavy industries. But I can mention two which have been seriously threatened by the re-armament drive.

One concern has brought into my area and into that of my hon. Friend the Member for Lanarkshire, North (Miss Herbison) a factory for the making of concrete sleepers. After long experiment they have proved that the concrete sleeper is equal to the wooden sleeper. But in its manufacture the use of high tensile steel is necessary, and that steel is an important factor in making such things as torpedoes. I think it would be a tragedy if the Ministry of Supply and the Ministry of Defence could not ensure that an industry which has so painfully established itself should have the opportunity to continue at least on a ticking over basis until such time as it can take up the slack. It cannot turn over to work for the re-armament programme because its employees are not adaptable. We must take the greatest care to see that unnecessary alarm over what one might call war preparations is not allowed to do permanent harm to the fabric of reconstruction which has been built up in these development areas.

My second point is this. I was rather disappointed with the Minister's reply to the right hon. Member for Southport (Mr. R. S. Hudson) on the question of machine tools. The British machine tool industry has done noble work, especially in the field of exports. When we consider the enormous number of machine tools required for the re-armament programme, it is obvious that we must import large quantities of them.

We can produce the re-armament, but we cannot do it economically if those machine tools are going to lie idle for 16 hours out of 24. If our production falls and we try to add to it by building more factories, we are simply diverting labour and materials from other purposes to build additional factories in which we are going to install tools which again will work only eight hours out of 24. The Minister realises the importance of that difficulty, but I feel its importance is so great—and this is one of the chief things emphasised in this Report—that we should make the fullest possible utilisation of these expensive machines when we get them from Europe, America or from the efforts of our own people.

All our re-armament depends finally upon the labour and productivity of our people. But, when I hear people talking of 6 per cent. of our labour force being moved and 500,000 people being moved, I say to myself, "These are not 500,000 units that we can move about like chequers on a board. These are human beings who have their roots somewhere. They are men and women who have grown up in a locality, who are attached to that locality and wish to continue to live in it."

It will not be easy to move them about unless two things are granted. The first is that we must impress upon our people that the purpose for which they are being moved is a worthy purpose. We must convince them that in yielding to these demands they are doing something which is for the benefit of themselves, of their children and of their country. I have no doubt whatever that if we put the, case up to them properly we shall get the proper response.

The second point is that it is no use talking about our people not producing enough. We have behind us in the working-class a tradition of exploitation—I can put it at no less and I am not an extremist—because time and time again men consented to do piecework and when they began to receive a decent week's wages their piecework was cut. Unless we can get that confidence again restored between employer and employee, it is no use asking men to work harder to complete a job sooner. But that can be done if we adopt the proper attitude.

Another point is that the time has passed when we can say that production is a matter for manager, for machines or for workers. All are partners in this great production scheme and, if we are to make productivity in this country what we need and wish it to be, it can only be done if we bring into our counsels in the factories the people who work in those factories. We must make our consultative committees places where employer, employee and manager can meet and work out their problems and find what is best for the production in their factory.

We shall have a job to find the incentives. I am loath to enter into a new field, but we are asking our people to produce more, and if they are to produce more we shall have to pay them more. They can only be paid in consumer goods. If we do not plan our rearmament together with civilian production for consumption, we shall fail to provide the incentive to enable our people to produce. I believe that the Government and both sides of this House face grave and serious problems, and it has been a great pleasure to me to find that today both sides of the House have treated the problem in a sane, non-party and completely British fashion.

7.35 p.m.

Photo of Colonel Ralph Glyn Colonel Ralph Glyn , Abingdon

I want to intrude on the time of the House for a few moments because there are one or two matters about which I want to speak from a personal point of view. First, I want to express my thanks to the Minister of Supply for the kind remarks he made, but I hasten to say that this is a Committee and not an individual. Every member of the Select Committee worked extremely hard, to say nothing of the clerks in the Committee Office, to whom we Members of Parliament owe a very great debt which is very often forgotten.

I believe that we have not concentrated sufficiently today on one of the most serious aspects of this problem of rearmament—the great lack of technical and scientific workers. I believe that to he one of the most urgent matters that concern this country. The work done by Sir Henry Tizard on the Development and Research Policy Committee has been first-class. He told us with great clarity that it is really the business of the scientist not to be thinking of the immediate armament programme but to be thinking in terms of what we shall want a few years ahead. If there is a shortage of technical and scientific staff and these very scarce skilled people are put on immediate problems, there will be a serious vacuum which will mean possibly failure to keep up to date here in comparison with other countries.

Those of us who served on the Committee dealing with expenditure in the last war will remember that when peace came certain resolutions were passed. I think they still hold good. The war was fresh in our minds and so were the problems we had overcome with superhuman effort, and it was easy to look back at that time and see what things had tripped us up. It was obvious that one of the things which had tripped us up and made our problems so difficult at the beginning of the war was that each Service Department had nothing resembling a section responsible for working out what specialised equipment that Service required.

There is nothing so important in the work of re-armament as to divide things into specialised equipment and general equipment common to the three Services.

I think it was General Sir Bernard Paget who said that every Service has its wants, but one must distinguish between its wants and its needs. That is a very true remark. We all know what we should like to have, but the question is what it is possible to get—and that must be the very best we can secure.

I cannot help recalling the history of the Valentine tank. We had great discussions in this House about tanks and we had special inquiries and special reports for the War Cabinet. The Valentine tank was so called because it was produced on St. Valentine's Day, 1938. The war began in 1939 and on St. Valentine's Day, 1938, this tank was turned down. When we started to inquire into the matter in 1940, everybody said, "For heaven's sake, what has happened to those months the locusts have eaten?" If we had had the Valentine off the drawing board on St. Valentine's Day, 1938, and in production, the history of the war might have been rather different. It takes a very long time and an intense amount of effort to produce these things.

Standardisation has been mentioned in this debate. We have not yet achieved the standardisation necessary. It is very hard to get it. It makes the most tremendous difference if we can achieve that, because I believe that the spare parts problem caused the greatest headache of all the small problems during the last war. I remember going to Chilworth, where there were a million and a half different items, and the difficulty there was in storing them, finding out their history, transporting and shipping them, working out how many the troops dropped in the mud and how many were actually used, and whether they were really what was wanted by the units.

All these problems are bound up with standardisation. It is probably well within the recollection of every hon. Member why the attack upon the Continent was held up for many months by the sudden discovery that there were not sufficient landing craft. Landing craft cannot be built in a few days. The other thing that mattered so much were the escort vessels for convoys, without which we could not move anywhere. I only mention these things to show that the picture is so big. The work the Estimates Committee have tried to do and what the Report has tried to present are aimed at giving a picture of the really big problem.

It certainly was a question of materials when we began to study this problem, but it has now switched from materials to labour, and especially skilled labour. I agree with everything that has been said today about the need for getting better understanding in the firms who carry out the work, and a closer conception of the great plan between those in the Government and those in all the branches of industry.

I hope I shall be forgiven if I use an expression which I have in my head, which is not a very complimentary one, but there is inevitably in every Government organisation what I always call the lunatic fringe of authority, which is somebody down below who will not see that somebody wants something, and who has not the power or the ability to say, "For heaven's sake get on with it. Of course it will be all right." It is that sort of frustration which upsets everybody, not only the man who wants to extend his factory, but also the woman who wants to buy something in the shop. It applies to everything, and I think it is due to the fact that we do not explain sufficiently the order of priorities.

One of the biggest problems the Government will have to consider in the immediate future is that of the bottlenecks of employment, and the danger spots of those bottlenecks which are always concentrated on by the mischief makers. This is not an easy thing to say, and I have to choose my words very carefully, but this re-armament programme will inevitably depress our standard of living for some years. If it does that, surely it is the business of all of us to see that our plans are not frustrated by people of evil intent.

The leaders of the trade unions have a tremendous task. They have tackled it with great courage, but they will be unable to tackle it properly unless they have the real co-operation of all the workers, the sympathy of all the employers, and the determination of the Government to see that these people who, I believe, go very near what we used to know as traitors are properly dealt with. That was why I was so glad to hear the statement of the Attorney-General in the House today. It is not fair to allow these mischief makers so much rein and so much rope; it is unfair to the workers. These people take advantage of the loyalty of the workers to their organisation; they hit on any small difficulty, make much of it. exaggerate it. and then produce a running sore, out of which we get these stoppages and delays.

I am certain that it would not be right to discuss re-armament in this House without mentioning that, just because our effort is so great and our object is so immensely important, all those people against whom we hope to plan in such a way as to prevent war will do their level best to delay these plans, and make them more expensive, and possibly more hazardous. I therefore think great courage will be needed. One thing that must be changed is the security arrangements, which I do not believe are adequate at the present. In the United States there is executive power to deal with this. Here there is no executive power; it is purely advisory.

The work that is being done by many people in trying to eliminate cells of disturbance and discontent is admirable. By the very nature of things, that work cannot be disclosed. But do not let us forget the work that is being done by trade union leaders and their deputies throughout the country, and how they are struggling to maintain the high position of British organised labour, in spite of these very sudden attacks that are continually being made.

Finally, I should like to say that I believe that there is a very grave danger that the more we succeed in these plans the greater will become the determination of the agents of those people who do not love us to wreck as much of our work as they possibly can; and there is a danger that a large percentage of the effort we shall make may be frustrated unless we deal with this matter while there is time.

7.46 p.m.

Photo of Mr Frank Tomney Mr Frank Tomney , Hammersmith North

The hon. Member for Abingdon (Sir R. Glyn) has, like other hon. Members, ranged rather widely over the whole subject of this debate. After his remarks, I wish to come back strictly to the text of the Report and to relate it to electronic equipment.

I am sorry that the hon. and gallant Member for Macclesfield (Air Commodore Harvey) is not in his place. He has very genuine feelings about the efficiency of the Royal Air Force, and he speaks on matters concerning aeronautics with a genuine desire to be helpful. He commenced his speech by referring to my hon. Friend the Member for Reading, South (Mr. Mikardo), who this afternoon devoted his speech, not to the subject under discussion, namely, this Report, but more or less to the pamphlet he and some of his hon. Friends have produced, "One Way Only."

The hon. and gallant Member for Macclesfield referred with some glee to the fact that he would quote the hon. Member for Reading, South, on platforms throughout the country in the autumn. Before he does that, I think that he had better wait the outcome of decisions to be taken, perhaps within the next few weeks, which will determine once and for all which way this Labour movement is going and whose policy it is backing, because I am prepared to say here and now that the united Labour movement of this country will be backing the official policy of the Government.

The hon. Member for Reading, South, delivered his speech with, I will not say skill, but with a certain amount of slickness. He was also naive about certain points. One of the most naive things he said was that the outbreak of the 1939–45 war was due to the fact that we overestimated the power of Hitler. I think that the present re-armament programme is cast in such a manner that at any future date we shall not over-estimate the power of any other nation vis-à-visour own potentialities.

The hon. and gallant Member for Macclesfield referred also to the electronics side of the armaments industry. I think it will be admitted that, along with the coal industry, which is a prime producing industry supplying all the armaments industries, the electronics side is the brains of the fighting forces, and any deficiency in production in this respect would be reflected throughout the whole of our Fighting Forces, and in their total fighting ability. Therefore, I want to address my remarks to the Minister in regard to this industry, its potentialities, its difficulties and the programme that is envisaged.

According to the Report, it is stated in page xi that the total expenditure for three years is in the region of £80 million. It also states that over a three-year period the output of the industry for 1950–51 has been running at a figure of £75 million, comprising home sales of radio and television sets, £42 million; exports of similar goods, including capital equipment, £18 million; defence production, £6 million; British Broadcasting Corporation requirements, £1 million.

The report is, I think, over optimistic in the sense that the global figure of £80 million can be catered for by the industry. I seriously doubt whether the industry is such as to enable the skilled personnel to give full effect to the programme which is envisaged. I have in mind one paragraph which states that the production of valves of a type similar to those required for civilian purposes could be readily increased by 50 per cent. and at the moment is just keeping pace with demand. This is a very contentious statement for these reasons. The radio valves used in civilian demand are generally not the type used in large numbers by the Forces.

The specialised electronic machinery which is operated by very few firms in this industry is of such a nature that it has to be built on the premises by engineers who have the know-all concerning glass and metal equipment, who know the various coefficient melting points of glass and copper and who, through a long period of progress and experimentation, are able to determine exactly what machine is required and what it can do.

I think that I can say without fear of contradiction that in regard to electrical equipment this country has nothing to fear from the United States from the point of view of technical excellence. It is true that the United States may be ahead on general production lines. The industry since 1945 has been turning over in regard to prototypes of television receiving valves and transmitting valves to a process known as pressed glass. Experiments have only gone so far as to permit the manufacture of this type of equipment in the smaller range of receiving valves. It is not these receiving valves which will be in most demand in a war emergency. It is in the higher range of transmitting valves that the demand will be. The needs of industry in this particular field differ perhaps from any other.

My hon. Friend the Member for Somerset, North (Mr. Leather), has referred to the upscale of wages in the mushroom industries connected with war, the dispersal of labour resulting in higher wages, and the necessity of men being tied down in the key industries in which they have spent the greater part of their life. I would remind the Parliamentary Secretary that this is a real problem. In these electrical industries we have a specialised field of labour which, I think, is not to be found in any other industry. The men engaged in the industry have mostly grown up in it.

One of the great problems with which we were faced during the last war was to prevent the outflow of labour from these essential key industries to the mushroom factories, paying bonuses, which did not guarantee the men a future at the end of hostilities. The men in the key industries had a guaranteed future, but at wage rates not commensurate with that paid in the mushroom industries which sprang up. Large bonuses were being paid in other industries which attracted labour, and unless we do something through the T.U.C. and the employers or through the direct intervention of the Ministry to balance that kind of thing in the event of hostilities, we shall have great difficulties, because these men are specialists in every sense of the term.

I think that it is true to say that no ordinary electrician can go into a radio valve factory and wire-up the specialised cabinet and electronic equipment there unless he serves at least 12 months with electricians in that factory. If these men are necessary, I think that we should be prepared to pay the price as an industry to retain their skill.

I can assure the Parliamentary Secretary that there was grave disturbance during the last war, and it was only due to the good sense of the trade unions and shop stewards that the personnel of these factories was held together. That is something which we have to look at. Speaking as a trade unionist, I do not think that it is right that these men should be held in key jobs where their skill is absolutely essential for defence purposes, when labour is being recruited into mushroom factories where the rates of pay are higher.

The production of radio and electronic equipment is not confined to production belts as this Report would have us believe. At some stage of manufacture, it must be manhandled. This work is done chiefly by women labour. Women have a peculiar dexterity for this type of work. I am speaking of the handling of filaments which must be mounted single-handed on the benches. Even in this field, the labour rates paid do not compare with the wages paid in war-time in other industries.

I think that I can say that in the radio industry at the present time the rate of wages is perhaps slightly greater than in other industries because of the special type of labour required, but in time of hostilities and in the time when we are developing a re-armament programme that leeway would be wiped out. I should like the Minister to look at that problem to see if something can be done to retain specialised women labour in these very essential factories.

I also want to make a plea in regard to the materials of this particular industry. This will be one of the keystones of the whole problem. I cannot see it mentioned anywhere in the Report. They consist almost chiefly of high grade tungsten, platinum, high grade nickel and other scarce metals, all of which are in short supply. I know that talks are going on in Washington with the Raw Materials Commission which have been very fruitful to this country, but I would ask the Minister to make sure that we get our fair share of these raw materials for this particular industry. I make that plea chiefly on account of the needs of the country and, secondly, because the excellence of the products is far in excess of anything that the United States can achieve.

Without impinging unduly upon the time of the House, it is right to say that this Report, while it deals with some of the difficulties of the electronics industry, is rather optimistic in its general conclusions. Unless the ground is prepared by the employers and trade unions, we may find ourselves in grave difficulties in a few years' time. New techniques may come along which may perhaps reduce the need for bench or workshop labour. There are only two large scale research laboratories in operation in England, and whether they are prepared to give their "know all" to the rest of the industry is a matter for agreement between the Ministry and the industry.

Experiments in electronics do not mean that the industry can leap ahead. It is very slow. The period of trial and error has to be gone through before an article can be said to be ready for the production lines. Any leeway in technical knowledge that can be made up between the various firms engaged in the industry should be made up, and I suggest that a separate conference should be convened so that there can be common agreement among the manufacturers themselves.

Whilst in other industries the rate of production can be greatly increased, in electronics it is not easy to do so. All engaged in it are specialists to a man. That is why I think the Report is optimistic about the possibility of fulfilling the programme. I urge the Minister to get together the technical Service chiefs to see what requirements are needed, what are the stocks, what are the possibilities of raw materials, and, above all, what are the plans for redundancy in this industry of specialised key workers.

8.2 p.m.

Mr. Ben:

The hon. Member for Hammersmith, North (Mr. Tomney) will not take it amiss if I do not follow him into such a technical subject, for I have not the specialist skill to comment upon his views. I was, however, interested in two things that he said when discussing the labour problems of the industry, and I hope to refer to them again in a few minutes.

I do not intend to repeat many of the arguments which have been used on both sides of the House during this extremely full debate. However, I found myself in complete agreement with the hon. Member for Motherwell (Mr. Alex. Anderson), the Chairman of the Select Committee on Estimates, and my hon. Friend the Member for Abingdon (Sir R. Glyn), who is primarily responsible for the writing of this Report.

I was especially glad that the hon. Member for Motherwell made the reference which he did to the problem of machine tools and to the urgency of using as many hours per day as possible, because the salient impression which emerges from this Report and the debate is that at the root of this problem are the questions of machine tools and of time in the sense of the amount of urgency.

The Minister of Supply rather misunderstood my right hon. Friend the Member for Southport (Mr. R. S. Hudson) when he referred to double-shift working, because, as the hon. Member for Motherwell pointed out, it is primarily a question of using the existing machine tools to the best advantage. It emerges clearly from this Report that it is also a question of making the best use of the machine tools available in the time which we have for the completion of this re-armament programme. The question of timing the programme depends very much upon the availability of machine tools. The first half of the programme is mainly devoted to the tooling up of industry, and the greatest production of actual armaments comes in the latter half of the programme.

It is, therefore, extremely desirable to have the maximum amount of double-shift working in the re- armament programme. It falls into two parts. As the Report points out and as my right hon. Friend pointed out, first there is that part of the engineering industry which makes armaments. It may be. that some appreciable degree of double-shift working already exists there, but the question arises of making the best use of the machine tools already available. Then, on the other hand, there is that part of the engineering industry which actually makes the machine tools, so that it is a question of getting the machine tools as quickly as possible in order to assist in the final processes of re-armament.

In the manufacture of machine tools double-shift working is almost nonexistent. I would refer the Minister to Question No. 1845 on page 155 of the Third Report from the Select Committee on Estimates, where a witness is asked: We are right, are we not, in understanding that there is practically no night shift work going on in the machine tool industry at the present time. He replies: It is difficult to say how much. I should think that no one in the industry has a full shift working. The answer relates not merely to night shifts but to double shifts. The witness goes on: Some are carrying on with something very sketchy, probably about 10 or 15 per cent. of the day shift. The evidence about the machine tool producing industry was that there was nobody with a full second shift going. Presumably some had no second shift at all, and many are carrying on with a mere sketch of the full day shift. That seems to be a matter which calls for some initiative from the Government as well as very urgent action, because we know that the machine tools are at the root of the problem. Until we have purchased them abroad or manufactured them at home, we cannot start upon the making of the products.

I may be asked where the labour is to come from, and I fully agree that it is an extremely difficult problem. I do not intend to repeat all that has been said, but I should like to draw attention to one or two matters which have been mentioned and not elaborated and which also are within the power of the Government, because they offer some scope in initiative and lead from the Government.

The first is, of course, the question of housing. It has already been referred to. I merely want to say that there are two aspects of it. There is the absolute shortage of houses throughout the country which no doubt commands the attention of the Government, but it ought also to be considered in relation to the mobility of labour. Housing is at present conducted on a local authority basis, and when a man crosses a local authority boundary he loses all his priority. He either goes to the bottom of the list in the. new area or he is not allowed on the list at all.

That is a very serious matter. It is all very well to ask a man to shift from where he is working to another place where it is desired that he should work, but if he is to lose the house which he already occupies, go to a new area and be billeted perhaps, and go to the bottom of the new local authority's housing list, we are not making a reasonable request, and we can hardly be surprised that the man does not want to go.

Photo of Mr Charles Pannell Mr Charles Pannell , Leeds West

The hon. Member is asking where the labour is to come from. In the machine tool industry there is a very high content of skilled labour. Presumably, if a man is a tool maker, or a turner, or a fitter in one town and he is brought to another town, he is brought to an engineering town where there are already engineering workers without houses. I cannot fol- low the hon. Gentleman's reasoning. We have had special pleading, for example, by the Home Secretary for policemen, to be put at the top of the housing list, over people who live in the local authority area. In this case they would be engineers.

Photo of Sir Ronald Bell Sir Ronald Bell , Buckinghamshire South

It was very kind of the hon. Gentleman to make that interruption. It leads me to my next point. I was not asking for priority for anybody. When he interrupted me I was pointing out that this splitting up of housing responsibility upon a local authority basis meant that a man forfeited the ordinary claim to a house which he would have built up in his home area according to his own needs. One knows how points schemes are operated. A man will have his name upon the regular list. He is asked to move into another area which will not even accept people on the housing list unless they were resident there in 1945, or something of that kind. We know that the difficulties exist. I am not asking for priority for any class of worker.

The hon. Gentleman's interruption indicates that moving people physically from one place to another is not the whole matter. In relation to the engineering industry, the hon. Gentleman's facts were not quite right. It is not true that machine tool engineering is situated only in engineering centres where it is subject to competition from other engineering activities. If the hon. Gentleman will look at page 156 of the Report, Questions 1846 to 1849, he will find the matter particularly dealt with by question and answer: 1847. The industry is spread about the place fairly well, is it not?—In the country—very well spread. The older machine tool manufacturing area was always the North of England, and it still is probably the most intensively occupied with machine tool manufacture; hut it spreads out to the North Midlands, and even in London there is quite a little hit being done now. I would say it is well spread.1848. So that you are not in the position of being located only in centres like the centre of the motor car industry?—Oh dear, no.1849. Where you have very severe competition 7—No. If I may summarise the effect of the replies, it is that the witnesses certainly say that the machine tool industry is spread well about the country and is not only located in centres where it is subject to severe competition from other classes of labour.

If it is the case that the machine tool industry is well distributed round the country, it may well be that the solution of physical movement of the workers, always undesirable in itself because people have their ties and friendships and do not want to move if they can avoid it, will not meet the case. The alternative is transfer from one industry to another. The recommendation in the Report urges: Where shortages of raw materials cause redundancy of labour in an industry, the Ministry of Labour should investigate the possibility of encouraging the workers concerned to transfer to industries providing full time employment on defence contracts. If there is a geographical difficulty one has to consider the housing point. If there is no geographical problem it is a question of transfer from one industry to another, and there are many problems. I invite attention to one to which the hon. Member for Hammersmith, North, rather led up to in his speech. It is not as easy as it ought to be for a man to transfer from one industry to another at the present time. It is all right if it happens to be the same union in both jobs, but unfortunately, a good many unions have a rule against adult entry. I think this point should be looked into. It is a very thorny, controversial, and difficult problem. It is one which the unions ought to be invited to consider in a spirit appropriate to the conditions of the time.

I am a little unhappy about the references in this Report to dilution and upgrading. Upgrading is all right, provided it is not done with any avoidable lowering of standards, to which the hon. Member for Hammersmith, North, rightly referred. He said that somebody introduced into specialist industry would need an apprenticeship of something like 12 months. Therefore, one wants to avoid dilution in the sense of lowering standards. What 1 am concerned about is that we should not give rise once again to the problems. that we have not yet got out of, of the dilution that happened during the war.

It was dilution with two statuses: the status of the man who was in the union, as an established, skilled worker, and the status of the man who was a dilutee, as he is called. He ought to be called a "dilutor." Such a man was not estab- lished and has never since been able to establish himself. He is the deferred man of the industry. During the war there was a relaxation agreement and the agreement having been made, it must be honoured. I ask the Minister to think very carefully before he sets all that machinery going again.

If we take people into industry, let let us give them training and apprenticeship, and send them to Government training schools, if you like. When we have trained them, let them become full members of the industry, entitled to the grade, and not make them a permanently deferred class. A man who now goes through Government training centres and serves an apprenticeship, perhaps for five years—it does not matter for how long—in this industry, still cannot become established in a skilled grade because the union has a rule against adult entry into that craft. That is another matter which is bound to affect mobility of labour. We cannot expect a man who is an established member of a trade union in one skilled industry to leave that industry to go to another one even in the same place where there is a different union and to have to work there as a dilutee with all that is involved.

I feel sure that in present circumstances the maintenance of that rule in its full rigour will seem to the trade unions themselves to be not justified, and if the Minister would make a sympathetic approach to them and invite them to reach a general agreement upon this which would not be in the nature of a temporary relaxation agreement, although there might have to be something of that kind as well for those who do not obtain the requisite standard of skill, a substantial contribution would be made towards the solution of one of the problems of labour in the re-armament programme.

8.21 p.m.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

The last time I had the privilege of following the hon. Member for Bucks, South (Mr. Bell) was in a debate before the students of the Imperial College of Science, South Kensington. To my great surprise I won the debate. The hon. Member was more successful when he went to Buckinghamshire, or, rather, the electors of Buckinghamshire were not as enlightened as the students of South Kensington, and so we are now privileged to continue our debates here.

Photo of Sir Ronald Bell Sir Ronald Bell , Buckinghamshire South

The hon. Member will remember that on that occasion, apart from the students, the majority of those present were stuffed mammals.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

That only proves that I also converted the stuffed mammals. I join hon. Members who have thanked the hon. Member for Abingdon (Sir R. Glyn) for his labours in connection with this excellent Report. I have read every word of it, and I found it a fascinating document. With the Report in the form of question and answer the evidence is more easily assimilated and we can see exactly what the position is. I am very much indebted to all the hon. Members who have laboriously sifted out the evidence in the Report.

I congratulate them especially on managing to get behind the "iron curtain" of that most reticent of Ministries, the Ministry of Supply. Last Monday I put three Questions to the Minister of Supply, which I have perhaps put more than once in this House. I want to know the cost of things. My Scottish environment has naturally made me anxious to find out what things cost. I asked the Minister first of all, the cost of the new rifle. Surely it is relevant, before we decide on a new rifle, to know the cost. But the Question was treated as rather an indecent one, and I received the reply: It would not be in the public interest to give this information. I then asked another Question about the cost of the new station in Australia the Ministry of Supply has organised to investigate the uses of guided missiles, and I received the same answer— It would not be in the public interest to give this information. I then asked another Question, also an indecent one, but I thought it was relevant even if it was indecent. I asked what was the cost of the Centurion tank, and I received this very informative answer: It would not be in the public interest to disclose this information."—[OFFICIAL REPORT, 16th July, 1951; Vol. 490, c. 76–7.] So I gather that we are called upon to vote these big sums for re-armament with very little information. The "iron curtain" is not very often penetrated, but in the Report I came to a part where the members of the Committee were asking very much the same questions as I had asked and, to my very great astonish- ment, I found very much the information for which I had asked in my Questions and was denied to the House. It had been supplied to the Committee in a memorandum.

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

If he had referred to the Report before putting down his Questions he need not have asked his Questions.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

I am aware of that, but it does not alter the fact that the Minister denied this information to the House. If the Minister had referred me to the memorandum I should have obtained the information, but it is an example of the secretive atmosphere which surrounds the Ministry of Supply.

I found this very interesting comment in the Report: A striking characteristic of the programme is the rise in the cost per unit of equipment. For example, your Committee obtained figures from the Ministry of Supply which showed that the current prices of typical Army and R.A.F. equipment are from two to three times those comparable issues in 1945.… The Report added: …though it must be noted…that more elaborate designs are now required. Let us look at some of this information which shows us the appalling increase in the cost of re-armament after rearmament has been going on for only a very short time. We are very much indebted to the Committee for some of the figures showing how the cost of things has steadily risen since 1945. For example, we are told on page 196, Annex 14, that rifle No. 4 cost £7 11s. 3d. in 1945 but that at the beginning of this year it had risen to £11 17s. 6d. The Cromwell tank which cost £10,500 in 1945 has now apparently yielded place to the Centurion tank, which costs £35,000.

Photo of Mr David Kirkwood Mr David Kirkwood , Dunbartonshire East

That is private enterprise.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

Of course it is, but it is not only private enterprise. The hon. Member for Bucks, South, was arguing about housing in relation to the rearmament programme. The general reconnaissance aircraft, which in 1945 was £44,845, has in 1951 gone up to £105,000. A fighter has gone up from £9,680 to £16,160. One of the cheaper types of bombers has gone up from £15,950 to £77,600. This figure is not that of the newest type of bomber, unless the Under-Secretary of State was wrong in an article which he wrote some time ago.

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

The hon. Gentleman is not quoting type for type. He has been quoting the cost of a fighter at the end of the war, probably a Spitfire, against a Meteor or Vampire jet fighter. He must make it clear, otherwise he is misleading the House.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

I am indebted to the hon. and gallant Gentleman for the opportunity of clarifying my case. Even if the types have changed, the cost of the aircraft have increased and the hon. and gallant Gentleman will not deny that as aircraft become more and more complicated up goes the cost. He knows as well as I do that in the recent air debate he gave an estimate of an American bomber which was far in excess of this.

So my general conclusion cannot be challenged that we have been faced since the re-armament programme began with an appalling increase in the cost of war material. This has gone up steadily, and as the re- armament programme proceeds this expenditure will increase at an appalling rate. This must mean that a very heavy additional sum will have to be paid by the British taxpayer.

I submit that the right hon. Member for Ebbw Vale (Mr. A. Bevan), is only the first of the prominent Ministers of this country to see the danger of re-armament. Although he does not go nearly as far as I do in my general argument against rearmament, yet he has pointed out the extreme danger unless the programme is cut; that it is imposing a heavy burden on the economy of this country, and that the Government must inevitably face the fact that it will have to be revised. I believe that argument is substantially true, and that it cannot, and has not been seriously challenged by all the newspapers that have attempted to reply to it.

A further point has emerged in this report about the apprenticeship system. The introduction to the Report, on page xix, says that: Men who have completed apprenticeship in the industries doing re-armament work now leave their employment just at the time when their industrial value becomes substantial, and go into the Forces, which are short of the equipment which these apprentices would otherwise be helping to produce. The conclusion drawn by the hon. Member for Abingdon (Sir R. Glyn), was that there was overwhelming evidence from the employers that the calling up of the apprentices into the Army was creating a difficult situation as regards skilled labour.

I hope that when the Parliamentary Secretary to the Ministry of Supply replies to this debate he will give us definite answers to some of the pertinent questions put by the hon. Member for Reading, South (Mr. Mikardo). The first was about how re-armament would affect the coal industry and how the programme would be affected by the possible shortage of coal. I agree with what he said, namely, that we have to look at the statement of the Prime Minister with a certain amount of reservation. That statement was to the effect that ample thought was being given to the re-armament programme in so far as it affected the coalmining industry and its relation to re-armament.

What were some of the fundamental arguments used in defence of the rearmament programme when it was placed before this House? We are now getting them repeated almost every week with a different set of figures. For example, I remember the Secretary of State for War making a very interesting statement at Dundee in which he said that the rearmament programme was necessary because the Russians had 175 divisions. Hardly a year afterwards the Minister for Defence said that there had been a mistake about these figures and that the Russians had, not 175 divisions, but 200 divisions, so that in the course of 12 months the number of Russian divisions against which we had to re-arm had gone up by 25 divisions. But now comes the Under-Secretary of State for War, and he gives the figure—[Interruption.]—This has not been dealt with and—

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

I do not supply the answers. When I supply the answers to the questions it will be much better.

The Under-Secretary of State for War gave the figure as 210 divisions, so that in the course of a few months we have had the estimate of the number of divisions against which we are to re-arm increased by 35. Apparently, the Russians are prolific. The Minister for Defence also said that the Russians were producing aircraft at a terrific rate, and that is probably true.

I should like to have some idea of the figures we are to quote when we are asked questions in the country. To what extent are we to be asked to re-quote figures which are so often altered as the intensity of the propaganda campaign develops? I was very interested in what the hon. Member for Abingdon said about bottlenecks and mischievous people. I do not think we can discard the possibility that there are, or are likely to be, mischievous people in industry. [An HON. MEMBER: "We are listening to one now."] I am not one of them. Any mischief that I perpetrate is done in the open, under your eye, Mr. Deputy-Speaker.

I would not agree with the hon. Member for Abingdon when he rather recommended us to use American methods. I have been reading some of the articles in the "New York Herald" in which these methods of counteracting sabotage were scrutinised, and I certainly am not in favour of the American F.B.I. method, which actually sent a secret service agent to become the Treasurer of the Communist Party in Washington. That is the danger.

The danger, as the hon. Member for Abingdon pointed out, is that the stress and bottlenecks must grow, causing discontent in our industry. I believe that he is right in that assumption, but I believe that the great mass of discontent that will come as a result of the re-armament programme, the driving down of the standards of living, and the inevitable effect on the export trade, causing grave economic difficulties, would come inevitably, whether there was a Communist Party in this country or not.

Inevitably when we get unemployment, a lowering of the standard of life and of trade union standards, we get industrial unrest which expresses itself in strikes. So I am not enthusiastic about increasing the expenditure of money on the Secret Service.

Mr. Deputy-Speaker:

Mr. Deputy-Speaker rose

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

I am only referring to it in relation to the re-armament programme. I would not mention such a holy institution if it had not been referred to by the hon. Member for Abingdon. I read that this year we are spending £4 million on the Service as compared with £3 million last year, and the more we spend on the Secret Service the more people disappear to Moscow. Even the Foreign Office are suffering from the rot now. I do not think we shall get anything in the way of improved production in this country by adopting American methods.

I believe the re-armament programme is founded on one great delusion, that we can negotiate from what is called strength. If this re-armament programme goes on another two years, all that will have happened will be that Russia and the satellite countries will have increased their tempo of re-armament and, if they have increased it as in the last 12 months according to the evidence of the Minister, we shall have the tremendous effect that at the end of two years they will say, "We will have to go in for a re-armament programme for another two years." That is the fundamental delusion around all this re-armament programme.

I find expressed in this Report the beginning of economic problems, the beginning of questionings of intelligent people who do not see it from my point of view, or from the international point of view, but from the point of view of economic difficulties that are arising and steadily accumulating, and I believe it time the Government read the Report and realised the abyss into which the nation is falling as a result of this re- armament programme.

8.42 p.m.

Photo of Mr Peter Roberts Mr Peter Roberts , Sheffield, Heeley

I was interested in the speech of the hon. Member for Ayrshire, South (Mr. Emrys Hughes). I followed him almost to the end but failed to follow his conclusion. Apparently he thinks that the re-armament programme in this country, which will be expensive and possibly ruinous, will not be expensive and possibly ruinous to another country.

Photo of Mr Emrys Hughes Mr Emrys Hughes , South Ayrshire

No. I believe it will be ruinous for both.

Photo of Mr Peter Roberts Mr Peter Roberts , Sheffield, Heeley

I did not follow that in the argument of the hon. Member. In the middle I certainly failed to follow the hon. Member when he talked of private enterprise and the building of the Centurion tank. The greater part of this tank is built in Royal Ordnance Factories under the auspices of the Minister, the steel is supplied by a nationalised industry and the coal by the nationalised coal industry, all of which have tended to put up prices, and it is a little unfair to say that the price of the Centurion tank is the price of private enterprise.

It seems to me that from both sides of the House the Minister has listened this afternoon and this evening to a series of hon. Members and right hon. Members warning him that one particular phase or another, if not properly handled, will lead to difficulties in the re-armament programme. We have heard about machine tools and about labour. I want to add the question of steel because, without proper supplies of steel, all this re-armament programme must fail. I wish to refer to the statement in the Report, on page 9, where the shortage of strip steel and other kinds of steel is pointed out. We know that over the last year or so the stocks of ingots and iron have gone down by something like 700,000 tons.

I suggest that the answer is in the next paragraph, which deals with scrap, and to this I should like the Minister to give his mind. At present conversations are going on in Germany, at Bonn, with regard to the release of scrap from Germany. In September of last year the Government agreed that the limit on the amount of scrap from Germany should be 600,000 tons. That was a mistake, and I think that the resulting reduction in scrap imports into this country is one of the direct results which has led to short time in some of the biggest steel mills, particularly in Sheffield. Four of the biggest mills in Sheffield are on short time, one of the reasons being lack of scrap.

Yet the hon. Member for Reading, South (Mr. Mikardo) said earlier that the export of cars, for example, from Germany was increasing.. Of course it is, as a result of the increased scrap which is going to the German mills. I say frankly that if there is to be short time I would rather it be in Dusseldorf than in Sheffield. The Minister, in the negotiations now going on with the German Government in Bonn and with our allies. should see to it that, if necessary, that limit of 600,000 tons of scrap should be removed so that we can get more scrap into this country to help our steel drive.

The other question I should like to ask the Minister concerns the fact that in the Report it is suggested that one of the reasons the collection of scrap—the scrap drive which the Ministry is pushing forward as fast as it can—is not going as well as it should do is that the initial price paid for scrap to the small person who goes round his works to see what he can collect is not sufficient.

Evidence is given about the differential in the price of scrap and pig iron. I should like to hear the Minister's views, and to learn how he would answer the question whether it would not be better to allow the price to rise in order to encourage people to bring out their scrap. There have been movements in that direction recently, but the matter has not been given enough publicity. The whole drive has not been given sufficient push. We have to get to the farmer, the small man. to go round and collect his scrap and produce it for the scrap drive.

My next point concerns the fact that if scrap is a difficulty, so is iron ore. The Americans, in their search for iron ore, have gone to Africa. There are vast reserves of iron ore of the richest kind, for instance, in Sierra Leone. That is near a seaboard, and ore could easily be transhipped to this country if necessary. I understand that the Americans have made great strides in developing certain iron ore fields in the area. What have we done? Very little indeed.

The Minister may say that it is not his responsibility, that it is the responsibility of the Colonial Office or the Colonial Development Corporation. Nevertheless it is his responsibility, as Minister of Supply, to see that iron ore is available to industry. He and the Government have taken over the general direction of the steel industry, and it is their responsibility to see that the ore is supplied.

Finally, I come to the question of tank production. I feel that the remarks on page 13 of the Report are really most distressing. It is said that the War Office did not decide how many tanks to order until the end of 1950, and therefore that the orders for machine tools and supplies for the tanks were delayed. Surely the number of tanks, if not the design, could at least have been estimated in general terms and the more simple tools could have been planned ahead.

I have certain knowledge of the engineering industry. I believe it is true to say that the industry was watching month by month for signs of the placing of orders and a re-organisation of tank production. Questions were asked over and over again as to why nothing was being done. We now begin to see some of the reasons. Apparently, the War Office were unable to make up their minds until the end of 1951. That is most deplorable. Further down on page 13, it states: These new resources are, however, unlikely to produce tanks under about two years. That is even more distressing. It appears that only two ordnance factories, and I think one outside firm, are dealing with this matter. My recollection is that during the war, a great organisation—I think that it was the Vauxhall organisation—was used for the production and organisation of tanks on a big scale.

I should like the Minister to state whether he is satisfied at the moment, in view of the commitments to which the re-armament programme gives rise, that there should not be an increase in the organisation not only for tank production but also for tank assembly. Time does not allow me to go into that matter in greater detail, but it is one of vital importance.

Then there is the question of railway equipment. It is impossible for this rearmament drive, for steel production and for the whole organisation of our industry, to run properly if we have not got the necessary rail equipment and rolling stock. I am most distressed that the Ministry of Transport and the Transport Commission are not getting the steel which is necessary to keep the railways in a proper state of repair. Not only that, but even if we want to get outside help —for instance, from South Africa—the people in the Colonies and Dominions also need railway equipment.

Yet the Government have an order to supply Persia with something over 35,000 ton's of steel for railway equipment. I do not want to say anything which might upset the arrangements under The Hague Court decision. But, in view of the appalling shortage of railway equipment in this country, and the crying need that there is in South Africa and Rhodesia for railway equipment and other materials, of which they have been kept in very short supply in this country for the last five years, and irrespective of what may be the outcome one way or the other in Persia, is it really right for the Board of Trade to allow this vital amount of steel to go to that country rather than to our Dominions or even to ourselves?

This debate has served a particularly useful purpose. It has shown from all sides of the House that many different facets of production, from radio valves to aeroplane manufacture, turbine screws, coal and steel, play a vital part in our rearmament programme. I doubt from what I have seen and heard so far—and I listened with great interest to what the Minister said tonight—whether the present Government and the present administration are capable of carrying out this programme successfully or have the organisation to enable them to do so.

8.54 p.m.

Photo of Mr Charles Pannell Mr Charles Pannell , Leeds West

I will not attempt to follow the hon. Member for Heeley (Mr. P. Roberts). I want to address myself to the remarks of the hon. Member for Bucks, South (Mr. Bell). If he has relied for his information, as evidently he has, on the Report, I am not surprised that he has been woefully misled. I refer to his observations upon such matters as dilution and the question of the workers in the machine tool industry. The 15th Recommendation in the Report says: Measures for securing the most vigorous development of schemes for training and a bold policy of up-grading semi-skilled workers, together with the dilution of skilled labour in every practical way, should receive every encouragement. The next Recommendation says: The experience which the Ministry of Supply may gain in building up a night shift at the Royal Ordnance Factory at Leeds should he used as a basis for advising and exhorting industrialists to accomplish the same result. Conversely, the Ministry should collate the experience of manufacturers in dealing with this problem. so that others may benefit If the labour side is so important—and, usually, I find that the recommendations that come at the very end of a long list are the most important—I suggest that skilled labour for re-armament is the most important single factor in the problem. If the labour side is so important, involving, questions of double shifts, movements of workers, union practices and rehousing, why, may I ask, were not the trade union organisations invited to give evidence to the Select Committee, and why is the worker in this field which is so important not heard at all?

I have gone through a long list of people in the Report who use labour, and who use it and look at it completely as if it were a commodity, just as one might consider so many lengths of railway lines or so many ingots of steel. I am not surprised that the hon. Member for Bucks, South, should be led astray to deal with such things as dilution. If dilution is to be introduced, it is necessary that we should say something about its history. In World War I—and my right hon. Friend the Member for Dunbartonshire, East (Mr. Kirkwood) will remember this—the workers in the engineering industry accepted at their face value the promises of the Government of that time regarding dilution.

They were promised that, immediately the war was over, there would be a restoration of trade union practices, and the engineers bartered their trade practices, which they had built up since the days of the combination laws, but, after the war, the Government broke almost every promise they had made to the organised workers of this country. There was no belief in the good faith of that Government.

We had on the benches opposite people like Sir Allan Smith, who represented Croydon, South—who had a worthy successor—and we had the late Mr. Gould of Cardiff, the shipowner. Anybody who reads the debate in 1922 on the engineers lockout, which lasted four months, will know that these people in the Conservative Party went into the lobbies against the engineers and refused them even an inquiry, with the result that there has been a constant history of mistrust and suspicion on the part of the workers in regard to the restoration of their trade practices.

I do not think it is unfair to say that, because hon. Members here who took part will know that that dispute was merely concerned with what were known as managerial functions. The employers said that they had an inalienable right to do what they liked with labour as a commodity. and, as a matter of fact, they broke the backs of the engineers after four months, and unemployment started. It was true to say that engineering workers were driven to do all sorts of things in the long depression of those days, and in any corporation department one could have filled a fair-sized tool room with skilled operatives who were employed on such jobs as lavatory attendants and park keepers.

During the debate on the machine tool industry not so long ago, I expressed certain reservations on whether it was right or not to prohibit the export of machine tools to Eastern Europe. When I was a young journeyman, I knew that in this industry large orders were received from Eastern Europe, and a market was built up which we did not like to lose. When we came to the Second World War and there were negotiations on the question of the relaxation of the agreements with the engineering unions, it was not surprising if the operatives' representatives were a trifle "cagey" about this sort of thing in view of all that had happened before. They believed in 1939 that we might very well face heavy unemployment after the Second World War. Consequently, most elaborate machinery was drawn up for dilution.

Generally speaking, dilution is the intake of men from industries outside engineering or the upgrading of semiskilled or unskilled types to do temporary skilled work. I beg people who are not engineers not to imagine that any dilutee can acquire the status of an engineer who has had a full-scale apprenticeship. It is true that some men who went into the Army and the Royal Air Force and passed certain tests were highly skilled in a limited sphere of operations. But the man capable of going through the whole gamut of the trade, of going from one skilled operation to another, can only be trained after a long apprenticeship. It is shere poppycock when hon. Members opposite, with no knowledge of engineering at all, talk in this way. I agree that there are plenty on this side of the House who are just as foolish and imagine that this business of dilution is as simple as all that. It is not, and, consequently—

Photo of Sir Arthur Harvey Sir Arthur Harvey , Macclesfield

I am sure the hon. Gentleman would not want to belittle the skill of those in the Services. He referred to the Royal Air Force. Surely, he will admit that the apprentices trained at the Apprentice School at Halton for three years, followed by a further course, are well qualified in engineering?

Photo of Mr Charles Pannell Mr Charles Pannell , Leeds West

They are not dilutees. The hon. and gallant Gentleman is conceding my point. But those who went into the Royal Air Force at 19 or 20 years of age and were taught limited operations are not in the same category as the apprentices of which the hon. and gallant Gentleman is speaking. I can see his point. He is talking of a good apprenticeship taken during the formative years of a man's life.

The hon. Member for Bucks, South, asked where the labour for the machine tool industry was to come from. Surely, the labour must come from the skilled engineering industry itself. One cannot train those sort of people overnight. We are talking about millwrights, toolmakers, fitters and turners, and these were the people who were allowed to rot away during the inter-war years.

Anybody who had to deal with the dilution of labour during the last war knows that on many of the highly skilled operations in many industries highly selected workers had to be engaged on the most highly skilled operations and that dilutees had to be brought, as it were, into the second line. With regard to the mushroom organisations which sprang up in the aircraft industry, many hon. Members on both sides of the House think that we in the Amalgamated Engineering Union are doing the people engaged in those organisations an injustice when we refuse to admit them to the full status of the engineering trade. In thinking like that, they do a disservice both to the engineers and to the industry generally.

When dealing with machine tools, we are dealing with a very highly skilled labour force. Somebody said that the machine tool industry is spread pretty well over the country. That is not necessarily to its advantage when we consider the question of housing the people engaged in it. But if I were to express the general view throughout the country, I would say that in Lancashire and the West Riding of Yorkshire, which were the cradle of the Industrial Revolution—I see the eyebrows of the Midlands are being raised—

Photo of Mr Peter Bennett Mr Peter Bennett , Birmingham, Edgbaston

The hon. Member has forgotten Boulton, Watt and Murdock in Birmingham.

An Hon. Member:

Hear, hear.

Photo of Mr Charles Pannell Mr Charles Pannell , Leeds West

The cheers came from someone who was not an engineer. Most of the industrial slums I have seen have been in Lancashire and the West Riding of Yorkshire, where considerable retooling is necessary. In Birmingham and Coventry, where the new motor car industry has sprung up, factories are pretty well highly tooled, and there are not the industrial slums there to the same extent as they are to be found in the North. But in this country 25 per cent. of the whole engineering industry is centred in London and in the Greater London area, and it is there that we have this problem of the supply of machine tools.

Somehow we must create confidence that trade union agreements will be observed if a recession in trade comes about and unemployment returns. The established men in the engineering industry, and particularly the skilled workers. must know that they will be protected if a recession takes place, because the re- armament programme does not depend primarily on dilutees, the semi-skilled or the unskilled, but on the willing cooperation of skilled workers in industry.

I hope that without too much political rancour or memory of years gone by I have said enough to make people with no experience of times of unemployment and times of broken pledges extremely careful how they use terms which are outside their own experience. I hope also that the next time the Select Committee meet they will discuss our problems in industry with the people employed in industry.

9.7 p.m.

Photo of Mr Malcolm McCorquodale Mr Malcolm McCorquodale , Epsom

I will not follow the hon. Member for Leeds, West (Mr. Pannell) in his argument, except to say that I think we on this side of the House, and I hope the whole country, recognise the supreme importance of skill. I am one of those who regard the skill of our people and our skilled trades as being the most priceless assets of our industrial set-up. Indeed, they are practically the one asset we have over the rest of the world. But, in this rearmament drive, do not let us minimise the importance of other people as well. Everybody, skilled and unskilled, is in this show to make it work.

My right hon. Friend the Member for Southport (Mr. R. S. Hudson) started this debate in a non-political manner. He took as his text the fact that the Select Committee on Estimates is a non-party or all-party set- up and that this debate should follow that set-up. I am glad to say that he has been followed throughout the debate in that same way. As the House knows, he is a trenchant controversialist when occasion demands, but we on all sides enjoyed his informative speech this afternoon. The Minister of Supply replied to it in a speech of the same tone and gave us a considerable amount of information.

I should like to join with the Minister in his expression of appreciation of the work of the Select Committee on Estimates and of the Sub-Committee, and especially of the work of my hon. Friend the Member for Abingdon (Sir R. Glyn). The Minister said—and I thought the House was pleased to hear it—that he agreed in the main with the conclusions of that Committee. There were one or two points he particularly mentioned to which I should like to refer. He talked about scrap. He did not hear—no doubt he will read it tomorrow—the excellent speech of my hon. Friend the Member for Heeley (Mr. P. Roberts) on that subject.

He touched on building contracts, Item (10) in the Summary of Recommendations. In my experience, and from what I have been told, the really annoying hold-ups that occur are usually in small things, such as the extra licence which comes before the provincial organisation who may have used up the number of licences they are allowed by the central Government, so that whatever is wanted is held up in a most annoying way.

After referring to productivity, the Minister laid emphasis upon managerial responsibility, and I do not think we wish to quarrel with him about that. He said that management had made a major contribution to increase productivity, and I am sure that that will be appreciated by managements throughout the country. Indeed, increased productivity in this country since the war has been remarkable; but we must not rest on our laurels; we must go ahead, because there is still plenty of leeway to make up.

The working party reports which have followed the visits to America, and which are so valuable, have emphasised the difference in efficiency between different firms in the same industry in this country. One report especially emphasises, as they put it, the necessity for the levelling up of efficiency towards that achieved by the best firms. This, of course, is the responsibility of management, but it also depends upon the cooperation of the workers; and it also, I suggest, depends very much upon the responsibility of Government to provide the conditions in which increased effort and efficiency can be obtained.

Let us not blink at the fact that there are occasions upon which old time practices—what are now known as restrictive practices—interfere with increased efficiency. My hon. Friend the Member for Somerset, North (Mr. Leather), emphasised this in a most interesting speech. Some two years ago the National Joint Advisory Committee was to be asked to inquire into this, but that seems to have been buried; we have never heard much of it since. I wonder what happened to it.

The one criticism of the Minister's speech—and I do not say this in any offensive spirit—was that it semed to be slightly complacent; he seemed to be satisfied with everything that is going on. The whole object of this debate seems to me to spur on the Government, the Minister and everybody connected with this re-armament drive to increased effort and to a more vigorous attitude towards the problems that arise. I should not like to go away with the feeling that the Minister is quite satisfied with what is going on at the present time, because I am sure he is not.

Photo of Mr Malcolm McCorquodale Mr Malcolm McCorquodale , Epsom

I am glad to hear the Minister say that he is never satisfied. That should be his outlook towards all these problems.

I think the House will agree that we have had speeches which have been informative, constructive and non- party from both sides of the House, in particular an excellent speech on productivity by my hon. Friend the Member for Woking (Mr. Watkinson). We also had an interesting speech, although there was not much of it with which I agreed, from the hon. Member for Reading, South (Mr. Mikardo), who said that in the first quarter of this year productivity had fallen back; that it had gone up steadily last year but had fallen back from the first quarter of this year.

I suggest that one of the reasons, other than the seasonal causes, why productivity has fallen back may well be the shortage of meat for heavy workers during those months of the year. In January, February and March the men toiling in the heavy industries want a bit of red meat. Apart from that, the thing that interested me most was the hon. Member's reference to the probability of a serious coal shortage this winter. It was only five or six years ago that the country was told that once we had a nationalised coal industry there would be no more shortages of coal; but this is a non-controversial debate, and I must not go into that. What strikes me about the hon. Member is that he put his points, many of them of an arguable nature, in such a persuasive way that he gets really more attention than his arguments deserve.

Then we had the speech of the hon. Member for Edmonton (Mr. Albu). which was a technical speech of great interest, emphasising the need for central research. Some of my hon. Friends are inclined to think that central research should go hand in hand with research in the individual firms, and that there is a danger of divorcing research from practice. Apart from that criticism, if it is one, I was in very large agreement with the points which he made.

We had a speech from my hon. and gallant Friend the Member for Macclesfield (Air Commodore Harvey) raising the question of the Brabazon and transport planes, about which I hope that we shall hear something from the Minister; and we had two speeches which, I think, alone justified this debate, one from the Chairman of the Select Committee, the hon. Member for Motherwell (Mr. Alex. Anderson) and the other from the Chairman of the Sub-committee whose Report this actually is. I think that those who heard those speeches will agree that they were on the very highest level. I recommend those who were not in the Chamber at the time to read them.

Then we had an interesting speech from my hon. Friend the Member for Bucks, South (Mr. Bell), who emphasised a point which had not come out before, namely, the woeful shortage of housing in this country which is restricting the mobility of labour. I think it may be generally agreed that we have had a most interesting day.

I would like to mention for a moment, because it has not been touched on before, the reason for re- armament. We have had, in these last few days almost a spate of speeches by Government spokesmen all over the country, giving us the reasons for the re-armament programme. I think they ought to be mentioned here. The Under-Secretary of State for Air, speaking to two of the great Auxiliary squadrons, I think they were Nos. 603 and 601, talked about the 19,000 aeroplanes at the disposal of the Russian Air Force which could stage a heavier bombing attack on this country than any experienced in the war. Another speech was by the Under-Secretary of State for War, who followed up some of the figures given by the Minister of Defence in this House some months ago.

He said that in addition to the 175 line divisions which the right hon. Gentleman had mentioned there were 40 supplementary divisions in the Russian armies, making 215 in all. In addition, the satellite countries had another 60 or 70 divisions, and probably the number of people under arms in Russia and the satellite countries was nearly 5 million. If these figures are correct, I am surprised at the sentiments expressed by the hon. Member for Ayrshire, South (Mr. Emrys Hughes).

The First Lord of the Admiralty summed it all up by saying that it would be contrary to our expert information and would certainly be for those in responsibility the height of folly to conclude that our programme was larger than we needed. At the same time spokesmen of the Government were reinforced by remarks made by the Secretary of State in America and by General Eisenhower himself. General Eisenhower used these striking words: We must develop primary material forces to ensure the safety of our front upon the Continent and the security of the world. This is the challenge of our time, and until satisfactorily met, shall be priority in all our thoughts, our work, our sacrifices. If these statements are correct—I have no reason to think they are not correct, although the size of the re-armament drive must be one for the Government to assess—I cannot see how any one should not be prepared to help them to the utmost to do what is necessary for the safety of our realm.

I have indicated the reasons for this re-armament. We have been told in another place and here how the giving out of the orders is getting on. Nearly half the orders have been placed, and the North Atlantic Treaty Organisation have fixed the size of the defence forces in each country. We are playing our proper part in that. What we want to know is how the programme is working out. The right hon. Gentleman told us that we were spending the money. Are we getting value for it?

In the few moments that remain I should like to make a few remarks on the subject which is the kernel of this problem, machine tools and manpower. We are told that 350 special machine tools are needed for this programme, but some time we expect from the Government a statement as to the position of our own industry. I believe we are manufacturing at present about 100,000 machine tools, of which we export nearly 40,000. Are we going to continue that?

I am glad to hear that we are purchasing machine tools from Germany, which will be a very good investment. I am glad to hear also that we have ordered machine tools from America, but, as many hon. Members have said, with the tremendous armaments drive in America, are we sure of getting them within a reasonabe time? That is one of the reasons why my right hon. Friend laid such emphasis—and I should like to reinforce what he said—on the possibility of industry using machine tools in double shifts. A machine tool working a double shift in a short-term programme is worth more than two working one shift. It saves the labour of manufacturing another machine tool, and the labour of building a house for a machine tool operator, while there are certain economies in overheads.

The position of machine tools in this country wants clearing up. It was stated in March, 1947, that there were substantial reserves of machine tools for aeroplane manufacture. In the Select Committee's Report we find that Mr. Wilks said that most of the machine tools had been sold and we had been hunting round to try and find them. I was glad to hear that the right hon. Gentleman has set up a machine tool controller, but will the right hon. Gentleman look again at the suggestion of the Select Committee that a machine tool census or, at least, a partial census should be undertaken? I am advised that there are a great number of machine tools of the greatest use which at the present time are not being properly used. That is a point worth pursuing.

There is one other point I want to emphasise. A strong case can be made out, as the Report says, for giving the machine tool trade a priority over other trades using their products until the programme gets well in hand. Machine tools should have priority over those trades.

Now I would say a word about the other side of the question, how to provide the extra 500,000 men and women in the armaments industry. I would reinforce what other speakers have said: it is no use considering those people as units. They are men and women each with different problems and different degrees of skill and responsibility. It is the task of the Ministry of Labour, not at the top but in the thousands of employment agencies in the country, to assess their individual problems. I would like it to go out from this debate that we look with confidence to the thousands of officials in Ministry of Labour offices who will cope with the tremendous problem of steering labour in the direction in which it is required to go.

I was very glad to read in the Report that it was not expected by any of the employers or Ministry representatives that there would be difficulties with the trade unions about dilution and up-grading. I am confident that this is so. In these days we have a completely responsible set of trade unions who will face up to these problems. When we last came to man up rapidly the munitions industry, exports were not so vital as they are today. We imagine that the Chancellor of the Exchequer will give us more exhortations on Thursday to increase our efforts.

The chief exports, except whisky which does not need a great deal of manpower, are textiles and motor cars. We are going to have more supplies of cotton in the coming year. The American crop is estimated at somewhere near 18 million bales. The cotton industry will be requiring not fewer but more people. We shall not be able to look there. From where is the extra labour coming?

One way to get more operatives is by persuading people to stay longer in industry. We had a debate recently on that subject, and the Minister said he was going to do something about it, but apparently nothing has been done. We understood that the Civil Service were the worst offenders by retiring people at the ages of 60 or 65. I came into contact with a fairly senior man recently who was very grieved because he was being made to retire, although he was quite active and young in mind and body. He said that he would not be able to live on his pension even at the increased rate, and he would gladly stay another five or 10 years in order to give increased service to the country. I would urge the Minister to go ahead in this matter. The Civil Service must give a lead to the country in persuading people to stay at work.

Another way is by working longer hours, which means systematic overtime. I was very glad to hear the statement by the President of the National Union of Railwaymen the other day when he said that his executive were prepared to agree to the working of longer hours in order to get us out of our difficulty. This measure may become more necessary in the re-armament industries. Portions of industry with which I am closely connected has already been working systematic overtime for a considerable time, as the Minister of Pensions knows.

I am not going into other improved methods of production because I consider that they have been thrashed out by different speakers from either side of the House, but I would mention a categoric statement which we had from the Parliamentary Secretary the other day, to the effect that he would not interfere with the call-up with regard to special categories. Unfortunately, shortly after that the Minister of Transport made an extremely odd statement, which was difficult to understand, about the proposed deferment of young railway workers. We want to know where we stand in this matter, and I am sure that the munition industry wants to know where it stands and would also like to know as soon as possible—I know we cannot fix it yet—what is to happen to the Class Z reservists and whether they are to be called up next year. It is time the Government made up their minds.

I have been analysing some of the figures that the Ministry of Labour publish in vast profusion in the Ministry of Labour Gazette. They are extremely interesting and give us some considerable measure of hope that we shall be able by vigorous methods to man up the re-armament programme voluntarily. I dislike quoting figures, but these are of interest and I want to give one or two. In the four months from the end of December to the end of April, the Forces have increased by 66,000, the total in civil employment has increased by 108,000 and the number of unemployed has decreased by 113,000. Those are very satisfactory figures.

Of the 108,000 who have increased the volume of civil employment, 15,000 have gone into the mining industry and 21,000 into the engineering industry, which is the main munition industry; and of the. 21,000, 2,500 have entered the machine tool industry and nearly 5,000 the wireless industry. Eleven thousand have gone into the vehicles industry in the last four months, and that includes the aircraft industry, into which 8,500 have gone. The textile and clothing industry has had an increase of 18,000 workers. That takes up the bulk of the increase of 108,000 in employment.

The direction which the Ministry of Labour is applying—"steering" would be a better word—to those who become available for labour is obviously bearing fruit, and it should be continued, but these rates are not sufficient. They are an indication that things are going in the right direction but they are not nearly large enough to enable us to complete the job.

Summing up the whole thing, I would say that a start has been made. We may well be on the right lines, but we must not sit back. We must apply not complacency but more and more vigour. We must urge the Government on until this great re-armament drive is well under way and we can really begin to consider that the safety of the country is assured.

I want to end by using the words that General Eisenhower used in the great speech he delivered a fortnight ago— The project faces the deadly dangers of procrastination, timid measures, slow steps and cautious stages. Let the Government keep away from all those vicious things; let them keep away from procrastination, timidity, slowness and too much caution, and I believe that they will yet be able to provide us with the armaments.

9.34 p.m.

Photo of Mr Michael Maitland Stewart Mr Michael Maitland Stewart , Fulham East

Our debate has been in form a mere discussion of a Motion to take note of certain recommendations of, if I may say so without being misunderstood and without any disrespect to the sub-Committee, a limited character, but in practice it has, as might have been expected, ranged over very nearly the whole field of the re-armament programme and, consequently, over very nearly the whole field of our economic and political problems.

The difficulty in discussing this topic is that of keeping it within manageable proportions even for the purposes of discussion. That is why I am sure that the sub-Committee were right to decide that they should focus attention on examples of some parts of the problem. I shall not find it possible in the time available to reply to all of the many varied points raised in this debate, but I assure hon. and right hon. Gentlemen who have taken part in it that the Government will pay the most careful attention to all that has been said.

Of all the many matters touched upon, the ones which received most frequent attention were problems affecting labour. I want to make that the centre of the reply which I now have to give to the House. It stands in a different category from all the other problems because, as my hon. Friend the Member for Leeds, West (Mr. Pannell), and, indeed, certain other hon. Members pointed out, we ought not to speak of the supply of labour in the same terms as we speak of the supply of steel or any other raw material.

I am here referring not only to the employee but to the efforts of the managerial side of industry. Our object is to see that labour in that broadest sense is placed in the conditions in which it can give the best results. We measure the size of this problem by describing it as one which will involve an addition of 500,000 persons to the defence industries. That means that we are requiring labour to be both more mobile and more productive than it has been so far. If we are to do that, we must see that its efforts are not frustrated. It is no good our telling workpeople to work harder if they are afraid that there will be no materials for them to work on. It is no good our telling managers to manage their industries more efficiently if they feel that their attempts to do so will be frustrated by the details of Government administration.

So before coming to the points specifically affecting the recruitment and employment of labour, I want to look at those technical points affecting administration and materials which help to create the atmosphere in which labour and management both have to work. As the right hon. Member for Epsom (Mr. McCorquodale) said, it is the business of the Government to provide the conditions in which the management and the employee can do what the nation is asking them to do.

First among those conditions I would mention a problem to which the right hon. Gentleman gave considerable emphasis, that of the provision of machine tools. He picked up a point made by my hon. Friend the Member for Reading, South (Mr. Mikardo): despite the success we had attained in placing orders for machine tools in the United States, would those orders be delivered? I think the House will appreciate that the extent to which I can say "yes" to that question must depend on the rate at which the American machine tool industry expands. Subject to that limitation, it is important to mention that we have a definite assurance that we shall retain the place in the queue which we have secured by our prompt action in this matter. The only qualification, therefore, to the answer "Yes." is that qualification, which springs from the fact that we cannot precisely prophesy the rate of expansion of the American machine tool industry.

With regard to the proper use of machine tools at home, the right hon. Gentleman took up the point to which another hon. Member had previously referred, and which is mentioned in the recommendations of the Sub-Committee: the question whether we ought to have a census of machine tools in this country. We very carefully considered that recommendation but we considered that the regional panels of experts whose business it is to deal with requests for new machine tools must necessarily, in the course of their duties, acquaint themselves with the utilisation of existing tools.

We considered also whether we ought to circulate the list of the Ministry's own store of tools to industry, but we reflected that if industry is ever in need of machine tools it can make its demands known and we can see whether we can supply them. We decided therefore, that both these recommendations required an amount of paper work that would not be justified by any practical result, and so we took the advice given to us by the the right hon. Member for Southport, who opened the debate, and we decided that there must not be too much form filling.

After machine tools, let me mention materials, a matter which was referred to by the hon. Member for Eye (Mr. Granville) and by my hon. Friend the Member for Hammersmith. North (Mr. Tomney).

Photo of Mr Robert Hudson Mr Robert Hudson , Southport

Before the Parliamentary Secretary leaves the subject of machine tools, I hope he will say something about the point, which both my right hon. Friend and I made, about what steps he is taking to ensure that new machine tools are used to their full capacity and are not left idle for 16 hours a day.

Photo of Mr Michael Maitland Stewart Mr Michael Maitland Stewart , Fulham East

That is a problem affecting the employment of labour, and I wanted to deal with it, together with other labour problems, later in my speech.

Photo of Mr Anthony Head Mr Anthony Head , Carshalton

Before the hon. Gentleman passes from the question of machine tools, may I ask him about a matter about which many hon. Members are disturbed? We have heard that a large number of machine tools, notably machine tools for tank engines. which are now urgently required, were sold during the past two or three years to other countries. Will the Parliamentary Secretary deny that or confirm it?

Photo of Mr Michael Maitland Stewart Mr Michael Maitland Stewart , Fulham East

Those industrial machine tools which were useful to industry were-made available to industry. It is true that the store which the Ministry now have available are specialised machine tools for defence purposes. I am sure—

Photo of Mr Anthony Head Mr Anthony Head , Carshalton

The hon. Gentleman has not answered my question.

Photo of Mr Michael Maitland Stewart Mr Michael Maitland Stewart , Fulham East

The hon. and gallant Member did not take part in the debate. I have a great many points to which to reply from hon. Members who did take part in the debate, and there is only a limited time at my disposal.

Photo of Mr Anthony Head Mr Anthony Head , Carshalton

The Parliamentary Secretary might answer that question which I put to him.

Photo of Mr Michael Maitland Stewart Mr Michael Maitland Stewart , Fulham East

If I understood the hon. and gallant Member's question aright, I have answered it. If not, I am sorry, but it cannot be helped.

Photo of Mr Anthony Head Mr Anthony Head , Carshalton

Brigadier Head rose

Photo of Mr Michael Maitland Stewart Mr Michael Maitland Stewart , Fulham East

No, I cannot give way. The hon. and gallant Member had an opportunity to take part in the debate had he wished to do so.

With regard to the allocation of materials, the House is aware that we have, with regard to certain materials, already proceeded along that road. We have the D.O. system, which was recently announced to the House by my right hon. Friend the Chancellor of the Exchequer, and which is the prelude to a fuller and more orderly allocation system, both for iron and steel and for other materials. It will indeed be essential for us to reach the position, urged on us by the hon. Member for Eye, where we can see without doubt that when a defence order is given the materials will be made available for it.

Another matter that may help to create the atmosphere in which labour and management can do their work was raised by the hon. and gallant Member for Macclesfield (Air Commodore Harvey), who complained that when firms engaged on defence orders sometimes had to make extensions of buildings, they were brought up against a tangle of regulations and licences. Some little while ago there were inter-Departmental consultations as a result of which we considerably simplified the process of getting building licences for works in connection with defence. More recently, we have held further consultations and we shall, I think, be able to improve that still further. I should, of course, be very glad at any time if the hon. and gallant Member or any other hon. Member would bring to my attention any difficulties that might be created by what the hon. Member for Abingdon (Sir R. Glyn) referred to in a happy phrase as the "lunatic fringe of authority."

The hon. and gallant Member for Macclesfield also urged on us the necessity—which we had already realised—of,observing a certain balance between the production of airframes and aircraft engines. That problem, of course, we have constantly before us. It is perfectly true that if we look at the programme at any particular moment we might observe a lack of balance because, as anyone who has studied the problem knows, in a re-armament programme over a considerable period of years there are bound to be a number of unforeseen and unforeseeable difficulties which will crop up. It may be that in one month one part of the programme is held up. Looking at the picture again a month or two later, we may have an entirely different picture: but over a period of time we shall be able to secure that synchronisation with which the hon. and gallant Member was concerned.

The hon. and gallant Member also asked about the Brabazon. Our view is that the information that can be gained from completing that project, will, on the whole, be worth the expenditure of human and other resources involved in it.

The hon. Member for Heeley (Mr. P. Roberts) made a number of technical points. He asked about scrap from Germany. He will appreciate that it is not only this country and Germany which were concerned in that decision, but that finally we had to reach a decision agreeable to other nations as well. I ask him to believe that the final conclusion reached, taking into account all the factors —political as well as economic—involved in that question, was the best decision that we were able to reach at that time.

Photo of Mr Peter Roberts Mr Peter Roberts , Sheffield, Heeley

I understand that negotiations are going on again and that this matter has been re-opened at Bonn at the moment. My question was whether the hon. Gentleman would use his best endeavours to see that our Allies dealing with this matter should realise our need.

Photo of Mr Michael Maitland Stewart Mr Michael Maitland Stewart , Fulham East

Oh yes, certainly.

The hon. Member asked about the price of scrap in this country. We have considered more than once whether an increase in the price of scrap would bring about the result of a marked increase in the amount made available and all the evidence we have seems to point to the opposite conclusion. The success we have had in the scrap drive so far suggests that if we were to raise the price, all we would be doing would be to pay a higher price for a quantity of scrap the enormous bulk of which would in any case have been made available to us. If mention is made of a possibility of raising the price of scrap, it may have the dangerous result of hoarding by those who would benefit by the increased price of scrap later on.

The hon. Member also mentioned tank production. He will realise that today, if we are to get more tanks, we have either to build new factories, or re-equip old empty plants. It is a different proposition from that which faced us during the war, and in those circumstances I do not think the period of two years is unreasonable.

Photo of Mr Peter Roberts Mr Peter Roberts , Sheffield, Heeley

Surely, rather than build extra plants and all that that means, it is possible to absorb into present industry a great deal of the accessories and spare parts which go to the assembly of a tank.

Photo of Mr Michael Maitland Stewart Mr Michael Maitland Stewart , Fulham East

That can probably be done to some extent, but it would not deal with anything like the major part of the problem.

In reply to the hon. Member's other question, when the War Office made up its mind on the number of tanks wanted, that is a rather complicated and detailed matter—[Laughter]—I hope the hon. Member who is laughing at this has himself studied the evidence and recommendation of the Committee. If the hon. Member who raised the question will look at pages 13 and 14 of the evidence, he will find, in some measure, an answer to the criticism he made.

I wish to turn from technical and material questions to questions affecting the actual employment of labour and the efficiency of labour itself. It is clear that the process of re-armament will create in certain places and in certain industries redundancies of labour. Indeed, in a sense it must do so if labour is to become available for defence purposes. One of the answers to the question where the labour for defence is to come from is that it is in a sense squeezed out of other civilian occupations, partly by the mere diversion of materials from civilian to military uses. Our task is to see that, although we may use the term "squeezed out" as a metaphor, it does not mean a harsh and inhuman process for the workers involved.

The Ministry of Labour have already considered this difficulty and have taken steps whereby employers who are expecting to find themselves in a position in which they have to declare redundancies will inform the employment exchanges in advance, and similarly that workers who expect before long to be declared redundant will at the earliest possible moment inform the employment exchanges so that we can carry through, where possible, the shift from civilian to defence work without an intervening period of unemployment.

Another matter concerning the supply of labour is that of the call-up of apprentices. I repeat what the Parliamentary Secretary to the Ministry of Labour said, that there is no present intention of altering the call- up. The hon. Member who raised the point realised that there are many grave arguments against deferring apprentices, and the fact that all potential employers of apprentices say that it would be a good thing cannot be taken as conclusive evidence of the desirability of that course.

Photo of Mr Malcolm McCorquodale Mr Malcolm McCorquodale , Epsom

Then will the hon. Gentleman be able to persuade the Minister of Transport to keep his mouth shut on the subject?

Photo of Mr Michael Maitland Stewart Mr Michael Maitland Stewart , Fulham East

If the debate is to proceed on those lines, I would say that if we are to get the best response from workers in industry there are quite a number of hon. Members opposite whose best contribution to the matter would be silence.

But, of course, this question of who should be called up and who should not is not a matter on which one ought to take one decision which is for all time. It is a question which has to be periodically re- examined—and which may differ whenever it is looked at—and we must try to make the best judgment in the circumstances.

A number of hon. Members referred to the problems that are described by the phrases "upgrading" and "dilution." The Ministry of Labour have, through the National Joint Advisory Council, been in very close touch with industry on these problems. My hon. Friend the Member for Leeds, West (Mr. Pannell), made clear to us all how extremely ticklish these problems can be, and that we do not help to resolve them by talking about them as if it were mere obstinacy that stood in the way of upgrading or dilution.

I doubt very much whether this is a topic which can be dealt with by a general and flamboyant appeal. It has to be dealt with by careful study of the detailed problems of each industry concerned. I am not merely using a form of words when I say that the Ministry have that under active consideration—indeed more than consideration—all the time.

Further, if we are to make available the labour for defence, we have to consider not only its movement from one occupation to another but in some cases its movement from one area on the map to another. Sometimes we can avoid that by moving the work to the men rather than the men to the work. We are in continuous consultation with the industries involved to see how far that can be done. It is part of the value of the process of sub-contracting that it sometimes enables us to shift the work to the place where the men are rather than to engage on the much more difficult and sometimes painful process of persuading human beings to move.

We have been by no means entirely idle on the question of the housing which is sometimes necessary when we nave to get human beings to move in order to get work done. There is a large number of defence projects in which the Ministry of Supply is concerned where we have, by consultation either with the appropriate Department of the central Government or with the local authority, been able to overcome the difficulties about housing which were mentioned by one hon. Member.

It was also suggested that labour difficulties could be dealt with if more use were made of double-shift working. It was said that that not only gave an increase, in one sense, in the manpower available for defence, but that it was a way of preventing the waste of machine tools. There again, I trust the House will appreciate that we cannot lay down any one single formula appropriate to all industries. We have to approach each group of workers with an appreciation of the effect which working double shifts is likely to have on the problems in their industry and on their way of life.

There again, the Ministry of Labour and the National Joint Advisory Council have made the strongest representations to both sides of industry. It is reasonable to expect that the consideration now being given to this topic by both sides of industry will produce results. I do not think that it will be possible to prophesy at what rate we can expect an extension of the double-shift system in industry. It is true to say that industry as a whole, employers and employees, are seized of its necessity.

On the question of productivity generally, I am sure that the hon. Member for Eye was right in deprecating too many general appeals. People do not want to be told in general to produce more, although perhaps there are occasions when such general appeals to the whole nation are desirable. If appeals are constantly repeated, they lose their effect. What is more important, but less spectacular, is the job of getting down to the problems of sub-contracting, the provision of houses and advance notification of redundancy. That is why I trust that I have not wearied the House by keeping on the rather pedestrian level of special detailed problems.

I should like to emphasise how much the Ministries concerned and the nation are indebted both to managers and to workers in industry for the progress so far achieved in the work of re-armament. My hon. Friend the Member for Reading, South (Mr. Mikardo), tended to question the necessity of the re-armament programme by questioning the figures of Russian divisions, ignoring the obvious and well-known fact that one calculation includes certain divisions and others do not.

He endeavoured to suggest that, before we embark on a re-armament programme, we should engage in calculations so elaborate in their nature that if we pursued them in any part of the ordinary business of life we should never get any practical work done. Those are the facts which he has ignored. I suggest that the Ministry and the Departments concerned are giving careful and steady attention to all the many detailed human problems involved.

It being Ten o'Clock, the debate stood adjourned.

Debate to be resumed Tomorrow